Under the professional management of Energy Income Partners, this ETF invests in high-quality companies across the energy market. It adds option premiums to the steady cash flows of infrastructure assets, seeking to pay distributions that stand apart from those of the broader market index.

It suits income-oriented investors who want exposure to the growth of the energy sector while preferring higher cash flow than typical equity investing provides.

First Trust launched this actively managed ETF in 2023.

The fund selects and holds high-quality companies across the energy value chain using a bottom-up approach. Based on those holdings, it sells covered call options or runs option strategies on energy-related indexes alongside them, strengthening downside protection and generating additional cash income.

• Active stock selection by a manager specializing in energy infrastructure
• Option strategies that maximize income and dampen volatility

Assets under management (AUM) stand at $1.1B, and the expense ratio is 1.11% per year.

Because the structure layers option premiums on top of the dividend income of the energy sector, its fees are higher than those of simple index-tracking products, but its ability to generate regular cash flow is strong.

Supported by rising energy demand and investment in infrastructure modernization, the earnings of related companies remain solid, and the appeal of the fund as an income asset stands out even in a high-interest-rate environment.

As global supply chains are reshaped and energy security grows in importance, capital continues to flow into the infrastructure sector, and retirement money seeking high income is showing strong interest.

Investors can expect stable infrastructure income and additional option income at the same time, but should note that upside may be capped if energy prices surge.

The XLE and VDE shown in the table are representative passive products that track the entire energy sector, while FXN selects stocks using a quantitative approach. Unlike these, EIPI pursues an active strategy focused on enhancing income. Similar infrastructure-focused products include AMLP and ENFR, and if you want broader dividend growth, FENY is also worth considering.

EIPI is a specialized product that combines energy infrastructure investing with a sophisticated option strategy, so before deciding to invest, use the key checklist below to confirm that it fits your investment goals.

Investors should fully recognize the sector's inherent volatility as well as the possibility of capped returns due to the option strategy. They should also pay close attention to how interest rate changes affect the valuation of infrastructure assets.

It suits investors who want to center their portfolio on stable dividend income while also sharing in the long-term growth of the energy infrastructure industry. It works well as a strategic asset for strengthening portfolio cash flow.