Posted 24 October 2006 - 05:18 PM
I still favor oil-heavy trusts over natural gas for the next couple years, and will continue to rebalance things with that in mind. For bargain-hunting - I'd love to see Enerplus and ARC (ERF on NYSE or ERF.UN for Toronto, and AETUF on the US OTC market and AET.UN Toronto) decline enough to make their dividends 10% or so.
I have to laugh -- at the recent lows Enerplus yielded 9.943% and for ARC it was 9.996%. Fairly close to 10%.
I didn't get any ERF and didn't get as much ARC as I now wish for. These are two of the biggest and very best trusts, conservative management and dividend payout, good reserve life, and good at controlling costs. The natural gas price decline and oil going from almost $80 to below $60 hasn't endangered the dividends. Now they've rallied back like they mean it. Oil has done little but ease off on the rate of decline and natural gas hasn't been that impressive yet. Maybe the trust pricing is telling us that it's still a bull deal for energy.
You can see from the charts that the nature of these beasts is to make panicky moves down, spike lows, "V" bottoms, etc. Barring a major bear market in energy, those are the times to buy. Natural gas went from a high over $15 in December to under $5 in September, so it could be said that the major bear market has already occurred there.
Perhaps we will have a warm winter and the large NG stocks now on hand will give us another move down in price. Combined with further price decline in crude oil, that would likely bring another great buying point for trusts. I would buy Enerplus and ARC upon a 60-70% retracement of the recent rallies, and more back near their recent lows.
For now, the move up of the last 2-3 weeks is mirrored by most trusts, and I'm going to use it to get out of weaker issues. The big bull market in trusts for six years prior to this spring allowed me to get complacent and take too much risk in chasing the highest yields.
Posted 24 October 2006 - 07:15 PM
Posted 24 October 2006 - 07:59 PM
A DOG ALWAYS OFFERS UNCONDITIONAL LOVE. CATS HAVE TO THINK ABOUT IT!!
Posted 24 October 2006 - 08:42 PM
Hey Scott -- a big triple zig-zag correction from the January high to the September low, now broken out above the downtrend line. It's already gone a long way in the last month, though.
Lots of oil & gas stocks acting relatively strong versus the products.
Posted 24 October 2006 - 11:50 PM
I'm going to stop with this chart. 4 of the original trusts have merged or been bought out, and those deals include formed exploration companies, stock shares and warrants that aren't included or reflected in the chart.
I don't own Pengrowth, Shiningbank or Thunder.
Posted 05 November 2006 - 07:48 PM
Posted 05 November 2006 - 08:12 PM
Posted 06 November 2006 - 12:05 AM
Posted 06 November 2006 - 05:15 AM
Cirrus wisely mentioned the possibility of conservative money managers, seniors, etc., thinking about the volatility and risk now in the trusts, thinking and worrying all weekend, so maybe we'll get another plunge tomorrow. I think the bad news is priced in for most trusts and going back to last week's lows would be good buys most everywhere IMO, even if just for shorter term trading.
I'm expecting a retest of lows or lower lows to buy into. We'll see.
BTW, I am surprised to see PEY.TO get such a poor ranking.