ETF Seems More Utilities Than Infrastructure

Macquarie Bank is back at the table with another infrastructure-based investment product that has been listed in the U.S.: the SPDR/FTSE Macquarie Global Infrastructure 100 ETF(GII Quote). But after analyzing its holdings and the performance of another of Macquarie's infrastructure fund, I don't believe it will serve as the proxy its name implies.

Macquarie is one of the five largest Australian banks and has created a niche with infrastructure funds. Generally speaking, the funds own pipelines, airplane hangars and plenty of other seemingly slow-growth, high-cash-flow businesses. Macquarie also has a suite of funds that, in a similar vein, own public electric utilities, telephone companies and gas companies.

Macquarie already has three U.S.-listed funds. The most actively traded is the Macquarie Infrastructure Trust(MIC Quote), which I wrote about almost a year and a half ago. The other two are closed-end funds: Macquarie/First Trust Global Infrastructure/Utilities Dividend and Income Fund(MFD Quote) and the Macquarie Global Infrastructure Total Return Fund(MGU Quote). Both CEFs trade at small discounts to net asset value and yield about 5%. ...