Regardless Peter, would you care to parse and examine the key sentence of my post Re NCE Petrofund (NCF.UN)
---------- From your referenced post """" Three old shares would have been worth $21.15 One consolidated unit was worth $13.35 at close yesterday. The difference is $7.80 """""""
--------- First point. Take a look to the charts of say NCF , AY, and ERF. I use telenium. What do all these charts show since the beginning of sept to oct. NCF dropped from $15 to $10.50 then recovered to $14.50. AY dropped from $11 down to $9 then recovered to near $11. ERF dropped from $27 down to $22.50 then recovered to near $27. They all behaved the same NCF dropped 30% then recovered. AY dropped 18% then recovered. ERF dropped 17% then recovered. What you say may take years to recover can do so as documented above in much less time like weeks or months. If you want to single out point A and B time sequences as you seem to like to do. Now if you want to look at other time sequences lets. Lets look at the yearly past high lows for NCF.
year ----- high ---- low ----- split adjusted
2000 ----- 18.15 ----- 10.68 ------
1999 ----- 13.65 ----- 5.46 -----
1998 ----- 13.80 ---- 4.62 -----
1997 ----- 19.20 ----- 11.25 ----
1996 ----- 20.85 ----- 14.70 -----
1995 ----- 18.75 ----- 1.35 ----
1994----- 22.20 ------ 13.50 ----
1993 ----- 12.90 ----- 8.10 ----
1992 ----- 16.50 ----- 10.50 ----
1991 ----- 25.50 ----- 15.00 ----
--------- Now if you want I can look up the rest of the years going another 10 years back. But this should be enough. They show the same. Now tell me again how, with the demonstrated ranges could take NCF years to get back to. The documented evidence clearly show that firstly it can and did happen in a matter of weeks, in the further above, or as just in right above in a years time. Not the many many years that you THINK. Now for me everyday the sun comes up , I will bet that the sun will come up tommorrow too. I will be right. Now the trusts because of what they are, what they do, and how they operate, will cycle as they always have. And I will be right. ------------------------------
-------- Second point. With the telenium charts (sept, oct) all show the same movement downward and then upward the only difference is the degree and AY and ERF did not have reverse splits at the time. So the reverse split was not the cause of the decline it only made it a little worse. The recovery afterward still happened-------
------- Third point. In post # 1998 I posted a similar yearly high low unit price chart for ERF. In 1998 ERF did a 6 for 1 reverse split. Go over that chart and see if unitholders are better off or worse off because of it. That shows at the very least it is a non-issue , at most a benefit. Do some number crunching if you like. ------------------
Please note ncf presently trading at $12.00 with 52 week low of $10.50 ...that is a long way from $21.15 before the reverse split and would require a lot of capital on the "average down" and many sardine payments(eight so far) before a possible break even happens...years I would say depending on the amount and levels on the ""average downs""
----------------- With all the facts I presented above we can clearly see that recoveries in unit value can and do happen with these trusts IT IS DOCUMENTED. They can and have happened in a matter of weeks , in a matter of months, but most importantly well below the many many years that you think. Actually 1 year. SO YOU SEE DOCUMENTED FACT AND DATA CLEARLY OUTWAY WHAT A PERSON JUST THINKS. -------------------------
also not to be negative but ...there is always, ALWAYS, the ever present danger of an "ENRON, NORTEL, LOEWEN" event, even with the trusts..(eggs in one basket eh)just because it has not happened , does not mean it will not.
------------------ And to this you have to look at the possibilities of that event happening. If it is always in the back of your mind. Gnawing away at you then the best possible solution is not to invest in anything and leave your money in a savings account. Of the many thousands of securities traded that one or two or a few at a time the above can happen to a stock puts the possibility of the event occuring at such a low level 5% possibly even 1% or less. If those odds are too high for you then leave your money in a savings account and be glad for what you earn from it.
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