Apologies if this a naive question, but, with reference to Bruce's original post, can anyone offer an opinion on whether a company like Brookfield Asset Management (specifically the cash flow from their preferred shares) would be considered a PFIC under the IRS rules? Thanx
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- 29 Oct 2011 10:19
- Forum: Taxing Situations
- Topic: The IRS and US citizens/green card holders living in Canada
- Replies: 124
- Views: 34611
- 05 Sep 2011 19:04
- Forum: Taxing Situations
- Topic: The IRS and US citizens/green card holders living in Canada
- Replies: 124
- Views: 34611
- 09 Aug 2011 11:45
- Forum: Taxing Situations
- Topic: The IRS and US citizens/green card holders living in Canada
- Replies: 124
- Views: 34611
- 18 Dec 2008 15:29
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred shares 2008 and earlier
- Replies: 636
- Views: 133618
I share your pain on the bam pref investments ltr! Below find a somewhat dated, but relevant analysis I plucked off the Web last spring. Although I can't take responsibility for its validity, I thought you and others might find it interesting. Also, a comparison with a subsequent DBRS credit analysis on BAM posted by Hymas on Prefblog July 11, 2008 is perhaps a useful starting point for additional research. A Review on Brookfield Asset Management By: Davy Bui Thursday, May 22, 2008 3:15 PM Symbols: BAM Brookfield Asset Management is an international investment and management firm with core operations in commercial property, power generation & transmission, timberlands, property development, private equity and financial services. The bul...
- 19 Jun 2008 11:35
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Stock/Bond/Index/Fundamental/Asset Class/Quotes - Sources
- Replies: 544
- Views: 114434
- 08 May 2008 14:33
- Forum: Taxing Situations
- Topic: Capital Gains and Losses - Questions
- Replies: 541
- Views: 69932
- 07 May 2008 18:54
- Forum: Taxing Situations
- Topic: Capital Gains and Losses - Questions
- Replies: 541
- Views: 69932
cap gains and losses on inherited cash
Can someone describe the capital gain/loss tax consequences in the following example of currency exchange:
A dual citizen resident in Canada inherits 1000 U.S. dollars in June, 2007. At that time, the C$ was above parity at ~1.07. Subsequently, in April, 2008, the C$ had dropped to ~1.01. When filing a Canadian tax return, what will the 2008 cap gain/loss consequences of exchanging the $1000 inherited US$ into C$ in April? And, when this same individual files a U.S. tax return, what will be the cap gain/loss consequences of this same currency exchange in the US return?
A dual citizen resident in Canada inherits 1000 U.S. dollars in June, 2007. At that time, the C$ was above parity at ~1.07. Subsequently, in April, 2008, the C$ had dropped to ~1.01. When filing a Canadian tax return, what will the 2008 cap gain/loss consequences of exchanging the $1000 inherited US$ into C$ in April? And, when this same individual files a U.S. tax return, what will be the cap gain/loss consequences of this same currency exchange in the US return?
- 02 Apr 2008 15:54
- Forum: Financial Planning and Building Portfolios
- Topic: Return of Capital
- Replies: 122
- Views: 11373
- 07 Feb 2008 13:17
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: US Banks (2008)
- Replies: 348
- Views: 82481
- 07 Feb 2008 13:10
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: US Banks (2008)
- Replies: 348
- Views: 82481
I thought perhaps those interested in the financial status of US banks might find the site below a useful resource:
http://www2.fdic.gov/qbp/qbpSelect.asp?menuItem=QBP
http://www2.fdic.gov/qbp/qbpSelect.asp?menuItem=QBP
- 30 Oct 2007 14:24
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Petro-Canada (Symbol-PCA)
- Replies: 96
- Views: 28175
Altared wrote:OPEC developing a basket of currencies
http://in.reuters.com/article/businessN ... 2220071027
- 01 Aug 2007 09:45
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Dream Office REIT (Symbol-D.UN) was Dundee REIT
- Replies: 25
- Views: 7938
I have decided to sell my units on the open market prior to the deadline and take my profits elsewhere. I think this is an extremely convoluted deal, and most of the twists and turns seem designed to take leverage constraints off the managers, make them more money, increase risk, and leave unit holders with scraps. I would not want to hold units in the new REIT under this management team. YMMV!
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- 23 Apr 2007 19:56
- Forum: Financial Planning and Building Portfolios
- Topic: Income Trusts, Part Deux.
- Replies: 152
- Views: 20757
Arnyk... thanks for the informative post upthread. I have been doing similar analyses on business trusts over the past few years and found very few that meet my conservative criteria as reasonable investments. However, I do have a question about your analysis. I have never been able to decide whether to include (i.e. monitize) the depreciation and amortization figures from the cash flow statement as contributions to distributable cash. It seems to me that d&a amounts are not really available as cash from the company pocketbook each year. At best, I see d&a as reflecting the capex costs most of these companies will inevitably encounter in the future. However, almost every calculation of distributable cash that I have seen described i...
- 27 Nov 2006 07:45
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
- 26 Nov 2006 19:30
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
Good analysis ltr! If I understand it, your argument essentially illustrates that an investor who is currently holding a discount perpetual may already have one foot in the interest rate trap that I described in the previous post (and that he or she is also enjoying a relatively nice yield as the trap closes in a rising rate environment). Alternatively, the holder of a premium perpetual can expect a somewhat longer time window (at a relatively lower yield) before the rising rates eventually manage to place him or her in the same trap. Makes sense to me, and consequently, from a risk perspective investors should perhaps feel more comfortable holding a ladder of premium perpetuals when compared to discounts. Your point is a good one, and I su...
- 25 Nov 2006 21:12
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
Well, HIMIpref can't predict the direction of interest rates, and isn't that what it's all about. I don't need to be too clairvoyant to predict how probable it will be that a call will be made if the interest rates move by a few percent points either way. I agree on both counts, but I suspect I failed to explain my concerns about a ladder including perpetual preferreds very well. Let me try to make my point again from another angle. Agreed that none of us can predict the direction of interest rates, and that we should be able to predict the likelihood of a call for any given interest rate scenario (some of James’ favorite anomalies notwithstanding). However, suppose next Monday I purchase a ladder of five perpetual preferreds and each of t...
- 25 Nov 2006 14:04
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
Ltr, I am still thinking and reading …. call it mental constipation! As you note, my general thought was a ladder of splits would mitigate risks associated with interest rate changes, particularly if those splits (like non-callable bonds) had only one terminal call date (and consequently only one YTW). This basic strategy, although obviously higher risk than a govt. bond ladder, still seems to make some sense to me. However, given the input from this thread, and some additional reading, I am having some doubts. Everytime I chase yield I seem to regret it. Below are the main reasons for my doubts in this case: 1. So far it has been hard to find high quality split issues that have just one predictable termination date. Many of them have poten...
- 24 Nov 2006 11:09
- Forum: Taxing Situations
- Topic: Tories consider Income-splitting
- Replies: 80
- Views: 7836
Steves,
If you set the initial numbers up for Scenario #4 so that retirement income splitting rescued Joe' from a current complete clawback on his indexed OAS income, but did not increase his wife's salary to the clawback level, I suspect you would see an even higher lifestyle outcome with the 95 yr termination date?
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If you set the initial numbers up for Scenario #4 so that retirement income splitting rescued Joe' from a current complete clawback on his indexed OAS income, but did not increase his wife's salary to the clawback level, I suspect you would see an even higher lifestyle outcome with the 95 yr termination date?
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- 24 Nov 2006 09:37
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
- 24 Nov 2006 07:29
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
To summarize various replies to my earlier queries, in these split share issues, I think one can conclude that the investor’s capital share retraction option in combination with the manager’s redemption option can potentially generate a problem for pref shareholders who have purchased their shares at a premium. Any substantial retraction of capital shares can trigger redemption of a matching number pref shares by the manager at par value. This redemption will create a capital loss for the premium pref shareholder proportionate to the size of the redemption, not to mention the loss of additional dividends the investor had hoped to earn on the redeemed shares. Although the total assets of the company will be reduced by this sequence of events...
- 23 Nov 2006 18:32
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
Thanx again for the input gentlemen... FYI, some informative and enjoyable commentary on split share forward payment agreements recently appeared at http://www.prefblog.com
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- 23 Nov 2006 03:16
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
You're correct that retractions will result in shrinkage of the underlying assets of the portfolio, but it also results in a reduction in the number of capital and preferred shares, because the retracted shares are cancelled. Since there are fewer shares after retraction, a smaller amount of distributions is required to service the smaller amount of outstanding shares. So typically it should not be any more difficult to service the distribution requirements after a retraction. There may be a concern if a very large percentage of the shares are retracted, because the fixed expenses of administering the portfolio are then spread over a smaller number of shares. If the number of outstanding shares becomes too small, then the portfolio expense...
- 22 Nov 2006 18:42
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
I don't believe this would place any downward pressure on NAV, since the shares are retracted for an amount below NAV. Thanx for the input Arby. I think perhaps I did not state this primary concern clearly. I will try again. Basically, I believe that any large capital shares retraction (at any price per share) that forces the manager to sell assets from the underlying portfolio and/or to buy preference shares for cancellation will by definition reduce the total assets in the underlying portfolio. As the total assets on the balance sheet shrink, it then becomes more and more difficult to generate distributions for the shareholders (i.e a large number of capital share retractions can potentially start an unfortunate downward spiral in the to...
- 22 Nov 2006 05:11
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
split share retractions
After doing some additional reading, I have a couple of more questions about split shares structures. Perhaps some of you folks who are more familiar with these investments can again provide some input. First, in the typical prospectus, I find there is usually an option for investors to retract either capital shares or pref shares once a month. There is also usually a small penalty payed for the retracting the shares (e.g. 96% of NAV on the settlement date). I presume the tendency for investors to use this option to retract capital shares increases with poor portfolio performance, a declining NAV, and a consequent drop in market price. It seems to me that any large capital share retractions could potentially exacerbate the investment’s poor...
- 12 Nov 2006 18:35
- Forum: Stocks, Bonds, ETFs, Funds, REITS and More
- Topic: Preferred share FAQ
- Replies: 69
- Views: 21390
Thanx for the comments James. Your warning about potential early calls is noted. Also, I should note that split shares with underlying income trust portfolios hold no attraction for me… beneficial early calls or not!!! Although the three yield curves that you linked are still based on a relatively small number of issues, I was surprised by the amount of scatter (compared, for example, to data I suspect one would see in a similar plot of government bonds). It is also curious, that the scatter in all three plots seems most pronounced in the shorter duration issues that are of most interest to me. Given your feedback, I think I will continue to consider this ladder strategy in the context of split share issues with no early calls. I will searc...