If you want to enjoy the benefits of diversification and balance, you can’t overload on any one stock or master limited partnership (MLP).

But starting this issue we’ll feature two Portfolio Holdings that stand out for new buyers, one more aggressive and the other more conservative.

This month’s representative in the latter camp is El Paso Pipeline Partners LP (NYSE: EPB). Our higher-stakes bet is Vanguard Natural Resources LLC (NYSE: VNR). Again, those with positions in these MLPs already should take care that any new purchases don’t overload them.

El Paso Pipeline Partners derives virtually all of its income from fee-based operations with limited sensitivity to commodity-price swings. That likely makes it the better choice for the most conservative investors.

The unit price has fully recovered from a swoon in mid-November. Yet with a yield of over 6 percent, it still trades at a discount to midstream favorites such as Enterprise Products Partners LP (NYSE: EPD).

The primary reason is the MLP’s general partner Kinder Morgan Inc (NYSE: KMI) collects incentive distribution rights (IDR) from El Paso. Enterprise Products has bought out its general partner and therefore doesn’t pay IDRs.

From an MLP unitholder’s perspective, it’s always best to pay little or no IDRs. The difference in valuations between those that pay and those that don’t, however, is well out of proportion to economics.

For one thing, El Paso yields a percentage point more than Enterprise Products, which is itself in a buying range. And its targeted annual distribution growth rate of 9 percent is three percentage points higher than Enterprise Products’.

El Paso actually grew its payout by more than 18 percent over the last year, a rate three times Enterprise Products’. And that growth the next few years will be fueled by the very highest-percentage of sources, asset drop-downs from parent Kinder Morgan, which still directly holds a huge chunk of what it acquired in the El Paso Corp merger.

El Paso will fund these drop-downs with low-cost capital. An upsized USD475 million, 30-year bond offering this month, for example, will pay just 4.7 percent to maturity. That’s virtually identical to the 4.5 percent yield to maturity Enterprise Products pays on its 30-year debt.

A deal inked in mid-November to build a Mexican gas pipeline under a 25-year transportation contract demonstrates how increased scale under Kinder Morgan has enhanced El Paso’s ability to participate in distribution-boosting deals.

El Paso Pipeline Partners is a buy for those who don’t already own it anytime it trades under USD38.

Vanguard Natural Resources’ monthly dividend is one attraction that currently stands out from other US MLPs.

Another is management’s continuing ability to use its strong financial position to buy quality reserves and production at low cost, taking advantage of the current weakness of other oil and gas producers.

At the same time it reported solid third-quarter results (see the November Portfolio Update), Vanguard announced the immediately accretive acquisition of natural gas and liquids assets in Colorado and Wyoming for USD335 million from Bill Barrett Corp.

Two weeks later it bought USD131 million of producing assets in the Bakken Shale in Montana and still earned an upgrade of its credit rating by Standard & Poor’s less than a week after that.

Third-quarter production was up 82 percent from year-ago levels, largely thanks to acquisitions.

Last month’s purchases ensure that momentum will continue, even as the company continues to make progress reducing decline rates at its wells.

As for hedging, management has found a way to factor out the vast majority of commodity-price exposure in natural gas liquids that hampered results earlier this year.

And it’s relentlessly reduced operating costs as its scale has increased.

No energy producer is wholly immune from energy price ups and downs. But Vanguard does have 100 percent of average expected 2013 gas production hedged as well as 86 percent in 2014, 78 percent in 2015 and 75 percent-plus for 2016-17. It’s also 91 percent hedged for oil in 2013, 72 percent in 2014.

That leaves some room to profit from upside in oil above the average floor price of USD91.50 a barrel. During the MLP’s third-quarter conference call CFO Richard Robert stated that “despite the more challenging commodity price environment we now operate in, we will be able to resume our measured approach for rolling our distribution.”