MLP investment is a totally new concept to me. I definitely will use these links that you gave me. When I have a little more knowledge of it after some reading, I will decide whether it is for my next investment. Thank you for your info. I will be back to this msg board to get your advise to clarify my doubts. Thanks again.
MLPs are an intriguing investment concept, and have been wonderful for a lot of people, but they are not the simplist things in the world to understand. Nor are they right for everyone. In the online community we see a lot of people saying "gee, I didn't know that before I bought it".
There are a number of good things to read online about MLPs. Certainly the PTP Coalition is one of the best. Here are some other links:
a Raymond James "MLP 101 Primer" at
a Smith Barney Dec 2003 MLP summary at http://www.technologyinvestor.com/images/masterlimitedpartnerships.pdf
A Wachovia securities MLP primer at the PTP Coalition http://www.ptpcoalition.org/MLP%20Primer%2011-10-03.pdf
An article by Ronald Londe of AG Edwards, which appeared in the Oil and Gas Investors e-zine at http://www.oilandgasinvestor.com/reports/pipeline/yields.htm
A Forbes article at http://www.forbes.com/forbes/2002/0318/188_print.html
and an article at MSN Money (from 2/4/04) at
If you do business with AG Edwards, or have a friend that does, their periodic (almost monthly) MLP survey article is great reading. While they "do the numbers" and the news each month, and include a "MLP Primer", they also include a new section or two each month on good topics like MLPs in the pending energy bill in Congress, the relationship between i-rates and MLP prices, the General Partner split controversy, etc. Always worthwhile reading.
I come to know you from GLW msg board. I respect your informative posting and always read them. I like your investing style, buying promising stocks for the long haul.
I am a novice in the realm of stock investing. I have bought my first stock of my whole life, which is GLW. I like to build my own stock profolio steady and slowly. I am going to hold GLW for a long time to let it grow. I have confident in GLW.
One thing I do learn is that diversification is importment in stock investing. I like to expose myself to the second stock. Your GLW msg board posting led me to KMP msg board. Because of your posting, got me intested in MKP. Currently, I am reading KMP related news publishing to get to know this company. Could you please give me some high level introduction of MLP, and KMP? What is your strategy that you are trying to own all four(KMP, TPP, BPL, PAA)? Thank you for your time.
Let's change the subect.
KMP is not a company, and does not pay dividends. OK
It is a LP (limited partnership) and pays distributions. Big differnence. Calling them dividends confuses many.
OK, off my soap box now.
If the intent here is to educate, well, hope this helps, and if I am in error, someone will tell us.
Have a nice day.
"I fully understand why you are thinking about stopping reinvesting the distributions. This year (heck...the past 30 days!) has been painful."
OK: if you put $10,000 in KMP exactly 10 years ago, and reinvested distributions, you would have $113,929 as of yesterday. Think about that. Reinvesting now offsets the reinvesting back end of last year when you were buying high. Now buying low. Hummmm.
Past performance is the best predictor of future performance in human adventure. That is accepted fact.
Short term thinking muddies the waters. IMHO
I was looking to buy yesterday, but was gone most of the day, then when I saw 5%+, just ruined my investing day.
Have a nice day.
Market totally overreacted the other day. Gotta think there were alot of "dumb" folks that probably sold on the panic. Bet they are regreting it now......
It was like a step function downward, and then as the day went on, people realized, so rates are going to increase to 2%,big deal, now they have to take their money from selling MLP's and find a place to invest it and beat the 7% distributions that grow around 10% a year.....I don't argue that MLPs aren't as attractive now that rates are rising but the plunge was Mr Market acting irrational....a good opportunity to get into quite a few MLP's. Some of the riskier ones like MMLP and EEP(risky because of low coverage ratio) briefly crossed into 9% area if I did the numbers right. Some of the REITs look nice as well. Obviously that is another can of worms due to mortgages and what not but still, some well managed ones were hit pretty hard. If you are looking for income the MLP's are a pretty good sector to be in.
Another good reason to continue reinvesting dividends is that they are actually return of invested capital and not dividends in the true sense of the word. If you reinvest your dividends, you'll never have a zero basis in your MLP units and won't have to pay capital gains on future distributions. You eventually will have to pay the capital gains if you sell the units or if you begin taking dividends in cash and eventually get all your original invested capital back. Of course you can always just purchase additional units will outside capital but since I don't need the income right now, I just reinvest it and build my nest egg.
Quite a bounce back today. Based on valuation, reasonable systemic and other growth potential and the yield, KMP should be in the 40-45 range yielding around 6-7%.
"I think $25". what meaningless babble. what an arbitrary number with no basis. who cares what your intuition is. You think it will drop 50% from its recent high? why? make a logical argument.