{"id":3620,"date":"2021-10-14T11:56:24","date_gmt":"2021-10-14T11:56:24","guid":{"rendered":"https:\/\/investwithanedge.com\/?page_id=3620"},"modified":"2021-10-14T11:56:24","modified_gmt":"2021-10-14T11:56:24","slug":"yorkville-etf-expense-ratios-at-6-34-and-6-86","status":"publish","type":"page","link":"https:\/\/investwithanedge.com\/yorkville-etf-expense-ratios-at-6-34-and-6-86\/","title":{"rendered":"Yorkville ETF Expense Ratios at 6.34% and 6.86%"},"content":{"rendered":"

\"\"Yorkville ETF Advisors manages two MLP ETFs. The Yorkville High Income MLP ETF (YMLP) became the second C-corporation ETF with its March 2012 launch, and the Yorkville High Income Infrastructure MLP ETF (YMLI) joined the menu in February 2013. At the time of their launches, I warned investors about the horrendous undisclosed expenses of C-corporation ETFs and the severe performance degradation of an entity with a 37% effective tax rate. Yorkville recently released its semi-annual report showing expense ratios of 6.34% and 6.86%.<\/p>\n

The summary pages for both YMLP and YMLI clearly indicate an Annual Operating Expense of 0.82% without any asterisks. The mangers boldly claim, \u201cOur YETF product line tracks MLP indexes.\u201d Again, no asterisk or disclaimer about the actual total expenses and their effect on performance.<\/p>\n

Clicking through to the YMLP fact sheet (pdf) produces more of the same: a stated expense ratio of 0.82% without further explanation. However, looking closely at the performance data starts to reveal a clue. From inception through 6\/30\/13, YMLP had a total annual return of +3.64% while the underlying Solactive High Income MLP Index returned +9.69%.<\/p>\n

Contrary to Yorkville\u2019s claim that its products track MLP indexes, YMLP has lagged its index by 6.05% annually. It has delivered less than 38% of the index\u2019s return. The YMLI fact sheet (pdf) reveals a similar story, lagging its index by 4.53% after less than five months on the market.<\/p>\n

Even the March 2013 prospectus (pdf) claims an expense ratio of 0.82% and \u201cother expenses\u201d of 0.0%. The footnotes state other expenses are assumed to be zero because as of November 30, 2012 the fund had not yet paid any income taxes.<\/p>\n

The real story is buried in the Yorkville May 31, 2013 Semi-Annual Report (pdf). There on page 7 (page 9 of the pdf), aligned sideways in small print, the truth finally comes out. The Yorkville High Income MLP ETF (YMLP) has Total Expenses of 6.34%, and Yorkville High Income Infrastructure MLP ETF (MYLI) has Total Expenses of 6.86%.<\/p>\n

I continue to be amazed the SEC allows this apparently blatant misrepresentation of the expenses incurred by C-corporations masquerading as ETFs. Regulators are allowing products to advertise expense ratios of just 0.82% and claim they track an index when the reality is quite different. Burying the real expenses in the semi-annual report falls far short of adequate disclosure to the investing public.<\/p>\n

\"\"<\/p>\n","protected":false},"excerpt":{"rendered":"

Yorkville ETF Advisors manages two MLP ETFs. The Yorkville High Income MLP ETF (YMLP) became the second C-corporation ETF with its March 2012 launch, and the Yorkville High Income Infrastructure MLP ETF (YMLI) joined the menu in February 2013. At the time of their launches, I warned investors about the horrendous undisclosed expenses of C-corporation …<\/p>\n","protected":false},"author":4,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"acf":[],"_links":{"self":[{"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/pages\/3620"}],"collection":[{"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/comments?post=3620"}],"version-history":[{"count":0,"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/pages\/3620\/revisions"}],"wp:attachment":[{"href":"https:\/\/investwithanedge.com\/wp-json\/wp\/v2\/media?parent=3620"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}