The finance ministry is very concerned about real or imagined leakages involving taxes in the income trust sector. It should, however, be really concerned about who (if any) leaked and who (if any) benefited from the information about the impending favourable decisions regarding trusts last week.
The decision to cut dividends and income trusts was announced to the public on November 23, 2005 at about 6 p.m. EST, after the markets closed in Toronto. Check out the action in some of the popular income trusts and high-yield dividend stocks that are a play on a potential income-trust conversion:
YLO.UN:
Nov. 22 - Closed at $14.09 on a volume of 456,600 shares.
Nov. 23 - Closed at $15.02 on a volume of 1.51 million shares.
Price up 6.6%. Volume up 3.3x.
CIX:
Nov. 22 - Closed at $22.45 on a volume of 665,800 shares.
Nov. 23 - Closed at $23.38 on a volume of 4.3 million shares.
Price up 4.1%. Volume up 6.4x.
BCE:
Nov. 22 - Closed at $26.60 on a volume of 1.7 million shares.
Nov. 23 - Closed at $27.90 on a volume of 4.8 million shares.
Price up 4.8%. Volume up 2.8x.
AGF.NV:
Nov. 22 - Closed at $20.79 on a volume of 92,900 shares.
Nov. 23 - Closed at $21.60 on a volume of 323,500 shares.
Price up 3.8%. Volume up 3.5x.
Suspicious? You bet. But, I for one, am not holding my breath for any investigation by securities regulators.
Note: Don’t forget your entry into the One Year Giveaway. Hurry! Only 3 days left!
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4 responses so far ↓
1 Ray // Nov 29, 2005 at 6:01 pm
It seems as though a few people noticed this. I was just watching ROBTV this evening and they had a securities lawyer on discussing this issue. I suspect that we will be hearing more about this over the next few weeks/months (although the OSC likes to take their time with their investigations so it may be longer than that).
2 Ray // Nov 30, 2005 at 1:32 pm
Now Steven Harper is talking about it. This may end up being an election issue.
3 Canadian Capitalist // Dec 1, 2005 at 8:26 am
Ray: There may not have been an intentional leak. It just needs to be investigated by the securities commission.
4 Canadian Capitalist // Dec 28, 2005 at 6:46 pm
Looks like the RCMP is launching a criminal investigation into the matter.
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