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

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To: russet who wrote (1597)	10/2/2001 11:11:13 PM
From: Lorne Larson	Read Replies (1) of 11633

ERF is holding up well because it has some nice hedges in place. However Yahoo board on ERF has a post from a person who contacted ERF and was advised that they have NO hedges in place for 2002. ERF pays out conservatively and than adjusts their payments (usually upwards) every 3 months. The next adjustment will be the November payment, which will support the trading price until then. After that its a race between the hedges expiring, and a hoped for increase in NG prices. If NG prices stay down, and ERF's hedges have expired, ERF will be in for a hammering. I'm not short ERF because I don't want to cover the monthly distributions. However if we get into December and energy prices are still down, I'll do it. NCF is simply too hard for me to figure out so I'm going to avoid it short or long. It trades on the U.S. market and as a result seems to be prone to extreme price swings, for reasons which aren't apparent to me. I don't believe for a moment however that they can maintain their .25 distribution. The trust that continues to amaze me is SHN. Have no idea what is holding this trust at $12.50. At present NG prices, next distribution will be less than half their last .70 quarterly distribution. I've shorted it down from $15.00, and if I had any guts I'd double my short position. However the price action right now makes no sense, which makes me very jittery. One I'm looking at to go long on is VKR. Can't see how it can go much lower. Reasonable oil/gas weighting. Anyone have any thoughts?

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