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Gold/Mining/Energy : Canadian REITS, Trusts & Dividend Stocks

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To: David Culver who started this subject	10/1/2001 4:35:26 AM
From: Peter W. Panchyshyn	Read Replies (1) of 11633

One should always be wary of the lure of high apparent yields since capital erosion can more than offset them. ------- Only in the short term and at commodity price cycle bottoms. Now if someone had done a proper look to how these trusts behave during the pricing cycle. Then they would know that. Knowing that then they would not be in for the short term. If they are then that is just their own mistakes. And something they will have to live with. However longer term which these trusts are best suited for. Capital erosion is not a concern. At price cycle bottoms one can aquire more units at a lower price thus lowering the cost base. Now when the price cycle starts to move upwards and to price cycle tops. Then those units purchased at the low end show very nice capital appreciation And then add to that the high income and returning higher income. And your laughing all the way to the bank. Thats what the real long term data has shown and will continue to show. Check it out !!!!!!!!!!!!!!!!!!!! Right now the market is telling you the payout rates on trusts in general won't hold up much longer. ------------ What the market is really telling you is that the unit pricing of the trusts will and do fall in accordance with the payouts. Thus maintaining double digit yields for those units purchased at the lower prices. Therefore accumulating at these levels ensures ones receive current high yield. Those other units purchased at higher levels still retain yields above current savings or term rates. Provided you employed a disciplined accumulation strategy. And limited your unit purchases to more historical average and below average areas within the pricing cycles. Then as discussed above when the cycle takes a turn higher you get the double whammy of higher income and capital appreciation. Again all supported by the long term data. Check it out !!!!!!!!!!!!!!!!!!!!!!

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