JPMorgan Chase Financial Company has declared the quarterly coupon amount for the Alerian MLP Index ETN (AMJB), providing updated data on this energy infrastructure strategy.
Announced yesterday, November 24, the coupon underscores the continued role of midstream Master Limited Partnerships (MLPs) in income portfolios. The declared coupon amount is $0.5006 per note. This corresponds to an annualized current yield of 6.6% based on the closing price of the notes on November 20.
The ex-dividend date and the record date are both set for Monday, December 1, with the payment date scheduled for December 9.
AMJB, which matures on January 28, 2044, tracks the Alerian MLP Index (AMZ), a cap-weighted composite of energy infrastructure MLPs. The note provides exposure to the midstream energy sector. That sector includes companies that earn the majority of their cash flow from moving, processing, and storing energy commodities.
AMJB serves as a successor to the JPMorgan Alerian MLP Index ETN (AMJ), which matured in May 2024, allowing investors to maintain long-term exposure to the asset class through a similar vehicle.
Under the Hood of AMJB
The structure of AMJB as an exchange-traded note (ETN) rather than an ETF is a critical distinction for portfolio construction. As unsecured debt securities issued by JPMorgan, ETNs do not own the underlying assets they track. Instead, ETNs promise to pay a return linked to the index. This structure eliminates the tracking error often associated with ETFs, which can be dragged down by fund-level taxation. However, it does introduce credit risk, as the payout is backed by the creditworthiness of the issuer rather than a pool of segregated assets. ETNs also tend to be more suitable for tax-advantaged accounts. This is because their coupons are treated as ordinary income for tax purposes.
For advisors, AMJB represents a tool for accessing the yield potential of energy infrastructure without the administrative burden of K-1 tax forms. The ETN structure issues a Form 1099 similar to MLP ETFs. While the variable coupon fluctuates with the cash distributions of the underlying MLPs, the 6.6% yield highlights the segment’s income-generating capabilities in the current market environment. ETNs also tend to be more suitable for tax-advantaged accounts, as their coupons are treated as ordinary income for tax purposes (read more).
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