Volatility continues to dominate the midstream energy sector in these first few trading days of 2019.  In this occasion, volatility is to the upside offsetting the gloomy last few days of 2018.  Never have MLPs had a better start of the year, which based on the Alerian Index, has registered a heart-warming positive 13% in the first 6 trading days. 

January is usually a strong season for the sector and the doom and gloom of December 2018 has made the rebound even stronger.  Such a strong start bodes well for the rest of the year, especially when put into the context of attractive valuations and a good fundamental background.  Having acknowledged that however, we are mindful of the failed rallies of the past and the recurrent and historically atypical strong correlation with crude oil prices.

Table courtesy of Howard Hinds