Five Canadian Royalty Trusts Offer High Yields

Canadian Royalty Trusts pay out a high portion of their profits to shareholders as dividends. Out of the many royalty trusts that trade in the US markets, five are listed below with their current dividend yields:

S.No. Fund Name Ticker Current Yield
1 Pengrowth Energy Trust PGH 8.23%
2 Penn West Energy Trust PWE 9.64%
3 Provident Energy Trust PVX 10.24%
4 Enerplus Resources Fund ERF 8.93%
5 Baytex Energy Trust BTE 5.34%

Though the Baytex Energy Trust currently offers a lower yield than others the yield is set to increase. From a news release yesterday: “Baytex is also pleased to announce that our Board of Directors has approved a distribution level of $0.18 per unit per month, an increase of 50% from the current level of $0.12 per unit per month. The $0.18 per unit distribution will commence with the distribution in respect of December 2009 operations, which will be payable on January 14, 2010 to unitholders of record on December 31, 2009.”

Unlike American royalty trusts Canadian trusts can acquire additional properties when the inital ones run out of oil or gas or other natural resources they extract. Canadian trusts also do not pay corporate taxes as long as they pay out a high proportion of profits as dividends to trust unit holders. It must be noted however that this special tax treatment of trusts is set to end in 2011. The Canadian government will then start taxing them as regular corporations and remove the special tax advantages they enjoy now. As a result of this tax treatment change these trusts will not be able to offer such high yields in the future.

Hi-Yield Portfolio(HYP)- Canadian Royalty Trusts

The following portfolio contains some of the Canadian Royalty Trusts that are traded as ADRs in the US markets. The average yield of this portfolio is a cool 9.56%.

S.No. Fund Name Ticker Yield
1 Fording Canadian Coal Trust FDG 3.77%
2 Harvest Energy Trust HTE 15.93%
3 Pengrowth Energy Trust PGH 13.84%
4 Penn West Energy Trust PWE 14.33%
5 Provident Energy Trust PVX 13.24%
6 Enerplus Resources Fund ERF 11.57%
7 Baytex Energy Trust BTE 10.49%
8 Advantage Energy Income AAV 12.41%
    Portfolio Average : 9.56%

Note:
1. The Dividend (Yield) info. is acquired from various sources and is thought to be
accurate when posted.
2. The Dividend (Yield) info. is as of 3/28/08