Our goal1
To provide a high level of total return with an emphasis on cash distributions.
What we invest in
The Fund seeks to achieve its objective by investing primarily in master limited partnerships (MLPs) in the energy sector. The Fund considers an entity to be within the energy sector if it derives at least 50% of its revenues from the business of exploring, developing, producing, gathering, transporting, processing, storing, refining, distributing, mining or marketing natural gas, natural gas liquids (including propane), crude oil, refined petroleum products or coal.
Currently and as the Fund makes its initial investments, the Fund intends to focus its investments in MLPs with operations in crude oil, natural gas liquids and refined products infrastructure. This reflects the subadviser's current belief that the combination of structurally higher global oil prices and the increased supply of domestic oil and natural gas liquids — due primarily to recent shale gas discoveries — makes MLPs focused on these liquid products well positioned for long-term growth. While the subadviser currently anticipates that liquid product-related infrastructure MLPs will be the Fund's primary focus, the dynamic nature of the energy markets may create new and potentially more attractive opportunities over time. Should macro energy, political, regulatory or tax considerations evolve, and other types of MLPs become more attractive, the subadviser may look to invest in these new opportunities.
Our approach
The Fund's managers will focus primarily on energy-related MLPs with long-lived assets and predictable cash flows, using a bottom-up process to find MLPs that they believe offer sustainable and predictable distributions, as well as relatively low direct commodity exposure. The Fund will also seek out companies with the potential to grow their businesses, and thereby their distributions, over time, evaluating companies based on their geographic footprints, the markets and types of assets they invest in, their balance sheet strength and their ability to make accretive acquisitions.
What should I know before investing?
All investments are subject to risks, including the possible loss of principal. The Fund's concentration of investments in energy related MLPs subject it to the risks of MLPs and the energy sector, including the risks of declines in energy and commodity prices, decreases in energy demand, adverse weather conditions, natural or other disasters, changes in government regulation, and changes in tax laws. Leverage may result in greater volatility of NAV and the market price of common shares and increases a shareholder's risk of loss. The Fund may make significant investments in derivative instruments. Derivative instruments can be illiquid, may disproportionately increase losses, and have a potentially large impact on Fund performance. The Fund may invest in small capitalization or illiquid securities which can increase the risk and volatility of the Fund. Please see the Fund's prospectus or contact your financial advisor for more information on the risks of MLPs.
Meet your ClearBridge managers
Richie Freeman (industry since 1976), Michael Clarfeld, CFA (industry since 2000), Chris Eades (industry since 1992) and Peter Vanderlee, CFA (industry since 1999) co-manage your Fund.
ClearBridge offers institutional and individual investors a variety of traditional and alternative equity strategies. With an investment heritage dating back over 45 years, ClearBridge offers distinctive manager insights and proprietary fundamental research.
Legg Mason's unique structure provides you with access to this specialized expertise. We offer a powerful portfolio of solutions through our independent investment management firms.