Friday, November 2, 2007

SDT.UN Lost 3.3% of Net Asset Value for Existing Unit Holders

SDT.UN reported their Net Asset Value (NAV) as of November 1, 2007 as $5.06 per unit. The NAV on October 25, 2007 was $5.23 per Unit. This represents a dilution of $0.17 or 3.3% to the existing unit holders as result of the share exchange offer they recently completed.

This is unfair and shows that management cares more about itself then unit holders.

As I said in my last post, all the benefits of professional management are accruing to the manager and not the investor.

SDT.UN is now trading at a 10% discount to Net Asset Value which is the normal range since the October 31, 2006 Income Trust melt down caused by the new Government of Canada 31.5% tax on Trusts. This explains their recent weakness.

I plan on slowly unloading my units in SDT.UN and develop my own diversified holdings. I may not do as well as Sandy McIntyre but I will probably beat him on a total return basis due to Sentry Select's disregard for its unit holders.

SDT.UN is no longer one of my top picks. Keep watching the BLOG as I will update my Top Picks selection shortly.

No comments: