Publicly traded master limited partnerships (MLP) have had a rough run since last July despite generally strong fundamental performances. If history is any guide, this marks an outstanding buying opportunity for the group.

For those unfamiliar with these securities, MLPs aren’t corporations but partnerships that trade on the major exchanges just like any other stock. You can purchase MLPs through your broker and will pay normal commissions just as if you were buying IBM or GE; more than three-quarters, in fact, trade on the New York Stock Exchange (nyse).

However, there are some key differences between MLPs and corporations. Chief among those are that MLPs pay no corporate-level taxation. Instead, these companies pass through the majority of their income to unitholders--MLP parlance for shareholders--as regular quarterly distributions.

These distributions aren't taxed as dividends but are extremely tax-advantaged. In most cases, MLP holders won’t have to pay tax on 70 to 90 percent of the distributions received until they sell their units. This allows significant tax deferral advantages.

Most US-traded MLPs focus on the energy business. The vast majority are involved in what are called midstream operations. This generally means owning energy infrastructure assets such as pipelines, oil and gas storage facilities and natural gas processing plants. Some MLPs have branched out into other energy-related businesses, such as owning tankers, leasing capacity on production platforms and even actually producing oil and natural gas.

The common thread linking most of these infrastructure businesses is that they’re extraordinarily steady and cash generative. For example, companies that own pipelines aren’t paid based on the value of oil or gas traveling through their pipes; instead, pipeline operators receive a fee linked to the volume of gas transported. In many cases, fees are partly or fully guaranteed under long-term contracts. In other words, once a pipeline is built, the owner can expect to receive regular, reliable cash fees with limited need for ongoing maintenance spending.

Because partnerships pay no corporate level tax, most of that cash finds its way into unitholders’ pockets. The average partnership in the industry benchmark Alerian MLP Index pays a yield of more than 7 percent; some pay yields of 13 percent or more. Even better, MLPs have a long history of increasing their distributions over time. In short, MLPs offer high, growing income.