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Friday, November 9, 2007

To Income Trust or not to Income Trust: Looking for Capital Gains from Income Trusts and a Steady Income Stream.

If you have been invested in the market recently then you have experience the major shock waves of highs and lows. Everyone is looking for the next big growth story, but what about a nice Capital Gain coupled with a steady flow of income?

Income Trusts have seen better days. Everyone has had their hate on this instrument and it is reflected in market prices. The first blow was the Conservative Governments change to the tax consequences of owning Income Trusts and the pain did not stop there. There has been a negative sentiment about these assets every since and again we are seeing 56 week lows. I also experienced this pain, but these are growing pains and you can’t make the next milestone without stretching.

This sound’s like opportunity knocking at the door: who doesn’t want to buy a nice steady income stream on the cheap? All those disgruntled investors that lost as a result of the new tax implications that is who.

But how long can this negative sentiment last?

It will last until you see a small group enjoy the great returns that Income Trust produce when purchased at the right time and it is too late to enjoy the full benefits of being an early wagon hopper. The right time may be now or it may be in the future; however, I’m betting on a near term appreciation and love the fact that I can by a high yielding trust for cheap.

If your interested in Income Trusts you need to do the proper research to find one or a few that are right for your portfolio. The best thing to do is to consult with a professional investment advisor who can help you make the right decisions.

Here is a list of Income Trusts that I am currently following and discussing with my investment advisor: