| Canadian energy trusts own oil and gas properties
with known reserves. As the oil and gas reserves become depleted,
the trusts buy more reserves so they can maintain a continuous flow
of income for investors. Investors like these trusts because of
their high dividend yields, which are often above 10 percent, and
their favorable tax treatment.
But the price of a trust varies directly with oil and natural gas
prices. So when oil and gas prices rise, the share price of a trusts
rises. Similarly, when oil and gas prices fall, the price of a trusts
falls.
Currently the following Canadian energy trusts are on the price
downside: Canetic Resources Trust (CNE),
Enerplus Resources Fund (ERF),
Harvest Energy Trust (HTE),
Pengrowth Energy Trust (PGH),
Penn West Energy Trust (PWE),
PrimeWest Energy Trust (PWI)
and Provident Energy Trust (PVX).
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