VanEck Introduces High Income MLP ETFs – Key Features
- High Income Potential
- Underlying indices target high income MLPs with attractive yield and distribution characteristics
- Potential for Tax-Deferred Distributions
- Taxed as corporations, the funds allow for potentially tax-deferred distributions, but may underperform their indices during rising markets
- Simplified Tax Reporting
- Shareholders receive Form 1099 instead of the complicated K-1s associated with direct MLP investments
IMPORTANT DISCLOSURES
The Market Vectors High Income MLP ETF and Market Vectors High Income Infrastructure MLP ETF (the “Funds”) are the successors to the Yorkville High Income MLP ETF and Yorkville High Income Infrastructure MLP ETF, respectively, pursuant to reorganizations that took place on February 22, 2016. Prior to that date, the Funds had no investment operations. Accordingly, for periods prior to that date, any Fund performance information is that of the Yorkville High Income MLP ETF and Yorkville High Income Infrastructure MLP ETF.
The Funds are treated as regular corporations for federal income tax, which differs from most investment companies. Unlike traditional ETFs, the Funds are subject to U.S. federal income tax as well as state and local income taxes. Further, the amount of taxes currently paid by the Funds will vary depending on the amount of income, and gains derived from investments and/or sales of MLP interests and such taxes will reduce your return. A portion of the Funds’ distributions is expected to be treated as a return of capital for tax purposes. To the extent distributions represent a return of capital; an investor’s cost basis will be reduced at the time of sale potentially increasing taxes owed.
An investment in the Funds may be subject to risks which include, among others, risks specific to MLPs such as tax risks, limited control of management, limited rights to vote on matters affecting the MLPs, and conflict of interests between the general partner or managing member and limited partners, all of which may adversely affect the Funds. MLP investments can be affected by macro-economic and other factors affecting the stock market in general, expectations of interest rates, and factors affecting the energy sector and infrastructure MLP industry. The complex tax nature of MLPs may adversely affect the Funds. The Funds may defer income taxes for many years on gains attributable to their underlying MLP holdings and the deferred tax liability used to calculate the Funds’ NAV could vary dramatically from the Funds’ actual tax liability. Upon sale of an MLP security, the Funds may be liable for previously deferred taxes and, as a result, the determination of the Funds’ actual tax liability may substantially increase expenses and lower the Funds’ NAV.
Tax information presented is for informational purposes only, and should not be considered tax advice. Tax information has been prepared based upon sources believed to be reliable, but VanEck makes no representation or guarantees as to the accuracy or the completeness of the information contained herein. Please consult your tax advisor for further assistance.
Solactive Indices have been licensed by Solactive AG for use by Van Eck Associates Corporation. Market Vectors ETFs are not sponsored, endorsed, issued, sold, or promoted by Solactive AG nor does this company make any representations regarding the advisability of investing in Market Vectors ETFs.
Index returns are not Fund returns and do not reflect any management fees or brokerage expenses. Investors can not invest directly in the Index. Returns for actual Fund investors may differ from what is shown because of differences in timing, the amount invested and fees and expenses. Index returns assume that dividends have been reinvested.
Fund shares are not individually redeemable and will be issued and redeemed at their ”Net Asset Value” (NAV) only through certain authorized broker-dealers in large, specified blocks of shares called creation units and otherwise can be bought and sold only through exchange trading. Creation units are issued and redeemed principally in kind. Shares may trade at a premium or discount to their NAV in the secondary market.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of the Fund carefully before investing. To obtain a prospectus and summary prospectus, which contains this and other information call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
Van Eck Securities Corporation, Distributor
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800.826.2333
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