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UBS ETRACS Launches 2X Leveraged Version Of Non-Energy MLP ETN Offering Significant Monthly Income Potential

Stocks in this article: LMLP UBS

UBS Investment Bank announced that today is the first day of trading on the NYSE Arca ® for the ETRACS Monthly Pay 2xLeveraged Wells Fargo ® MLP Ex-Energy ETN (NYSE Arca®:LMLP). LMLP is linked to the monthly compounded 2x leveraged performance of the Wells Fargo ® Master Limited Partnership Ex-Energy Index (the “Index”).

LMLP Profile

Underlying Index: Wells Fargo ® Master Limited Partnership Ex-Energy Index
2x Index Yield:* 15.24%
Income Potential: Variable monthly coupon linked to 2 times the cash distributions, if any, of the Index constituents

*This figure is equal to two times the Index Yield calculated as of June 20, 2014 by the sponsor of the Index, Wells Fargo Securities, LLC. Investors are not guaranteed any coupon or distribution amount under the ETN.

LMLP Offers Investors:

  • Significant income potential in the form of a variable monthly coupon linked to 2x the cash distributions, if any, on the Index constituents.
  • Monthly compounded 2x leveraged exposure to the Wells Fargo® MLP Ex-Energy Index, less investor fees.
  • 2x exposure to an index comprised of publicly traded companies organized as either a Limited Liability Company or Limited Partnership that derive a majority of their income from non-energy related activities.

"We are pleased to offer investors the opportunity to obtain 2x leveraged exposure to the Wells Fargo ® Master Limited Partnership Ex-Energy Index," said Christopher Yeagley, Head of ETRACS. "We expect LMLP to provide significant income potential."

About the Wells Fargo ® Master Limited Partnership Ex-Energy Index

The Wells Fargo® Master Limited Partnership Ex Energy Index is intended to measure the performance of all non-energy master limited partnerships (“MLPs”) listed on the New York Stock Exchange (“NYSE”), NYSE MKT or NASDAQ that satisfy market capitalization and other eligibility requirements. The Index is a modified market capitalization-weighted index of master limited partnerships (MLPs) that do not have an energy focus and that have a market capitalization of at least $100 million at the time of inclusion. The capitalization weighting methodology is referred to as modified because it includes a 10% weighting limit under which the MLP classes of a particular issuer may not exceed 10% of the total capitalization of the Index. The Index was created on April 1, 2014 and, therefore, has no performance history prior to that date.

Top 10 Index Constituents

Name     Ticker     % Weight
KKR & Co LP     KKR     10.86%
Blackstone Group LP     BX     10.48%
Lazard Ltd     LAZ     10.43%
Carlyle Group LP     CG     10.33%
Icahn Enterprises LP     IEP     10.31%
Och-Ziff Capital Management Group LLC     OZM     9.48%
Apollo Global Management LLC     APO     9.29%
Oaktree Capital Group LLC     OAK     9.12%
Fortress Investment Group LLC     FIG     4.92%
Cedar Fair LP     FUN     4.35%

Source: Wells Fargo Securities, LLC, as of 06/20/14

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