SCHEDULE: Sit Investment Associates Discloses 5.2% Stake in NXG Cushing Midstream Energy Fund

Sit Investment Associates, Inc. and its subsidiary, Sit Fixed Income Advisors II, LLC, reported a 5.2% beneficial ownership stake in NXG Cushing Midstream Energy Fund as of December 31, 2025.

Summary

• Sit Investment Associates, Inc. and Sit Fixed Income Advisors II, LLC, both registered investment advisers, jointly reported beneficial ownership of 323,176 shares of Common Stock in NXG Cushing Midstream Energy Fund.
• This ownership represents 5.2% of the total class of securities outstanding.
• The reporting persons hold shared voting power and shared dispositive power over all 323,176 shares.
• The shares are held on behalf of client accounts managed by the investment advisers, and they disclaim beneficial ownership of these securities under Rule 13d-4.
• The acquisition of these securities was made in the ordinary course of business and not for the purpose of changing or influencing the control of the issuer.
• The ownership percentage is calculated based on 6,223,470 shares of common stock outstanding as of May 31, 2025, adjusted for the Issuer's rights offering on December 11, 2025, and its offering program.

Sentiment

Score: 6

Explanation: The filing indicates a significant institutional investment in the fund, suggesting a positive view from the reporting entities. However, it's a passive disclosure and doesn't provide operational or financial performance details of the issuer.

Positives

• Two established investment advisers, Sit Investment Associates, Inc. and Sit Fixed Income Advisors II, LLC, have taken a significant 5.2% stake in the fund, indicating institutional interest.
• The investment is stated to be in the ordinary course of business, suggesting a passive, long-term investment strategy rather than an activist intent.

Future Outlook

This filing is a disclosure of historical ownership and does not contain forward-looking statements or guidance regarding the issuer's future performance or strategic direction.

Management Comments

• The securities referred to above were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of the securities and were not acquired and are not held in connection with or as a participant in any transaction having that purpose or effect, other than activities solely in connection with a nomination under §§ 240.14a-11.
• Pursuant to Rule 13d-4 of the Securities Exchange Act of 1934, as amended (the 'Exchange Act'), SIA and SFI disclaim beneficial ownership of such securities.

Industry Context

This filing indicates that institutional investors are taking positions in midstream energy funds, which could reflect a positive sentiment towards the energy sector, particularly infrastructure assets, or a specific investment strategy related to such funds. It suggests continued institutional interest in the sector.

Comparison to Industry Standards

• A 5.2% stake is a significant passive investment for an institutional investor, typically triggering disclosure requirements like Schedule 13G.
• The reporting persons are registered investment advisers, which is standard for entities managing client accounts and making such disclosures.
• The disclaimer of beneficial ownership under Rule 13d-4 is a common practice for investment advisers who hold shares on behalf of clients but do not have direct economic interest.

Stakeholder Impact

• Shareholders: Increased institutional ownership could be seen as a positive signal, potentially increasing liquidity or stability.
• Management: Awareness of a significant institutional holder.

Next Steps

• NXG Cushing Midstream Energy Fund will continue its operations.
• Sit Investment Associates, Inc. and Sit Fixed Income Advisors II, LLC will continue to manage these shares on behalf of their client accounts.
• Future Schedule 13G/D filings would be required if ownership significantly changes (e.g., crosses 10% or changes purpose).

Key Dates

Recommendation

This Schedule 13G filing merely discloses a passive 5.2% ownership stake by Sit Investment Associates and its subsidiary in NXG Cushing Midstream Energy Fund. It indicates institutional interest but provides no new operational or financial data about the fund itself to warrant a change in investment thesis. The reporting persons explicitly state the acquisition was in the ordinary course of business and not for influencing control. Therefore, a 'hold' recommendation is appropriate as this filing does not present new information that would fundamentally alter the investment outlook for the fund.

Keywords

NXG Cushing Midstream Energy Fund, Sit Investment Associates, Sit Fixed Income Advisors, Schedule 13G, beneficial ownership, investment adviser, common stock, energy fund, midstream energy