Sentry Select, much to my surprise, has released no news release regarding the results of their annual redemption option – I would have thought that such an announcement would be a regulatory requirement, but I’ll admit I’m not as familiar with the reporting requirements of public companies as I’d like to be.<\/p>\n
Anyway, thanks to Financial Webring Forum<\/a> and an Assiduous Reader, I can now say that they were forced to redeem about one-sixth of their units; according to their June 30 Semi-annual report<\/a>, they used to have 13,071,383 units outstanding; now, according to the TSX<\/a>, they have only 10,896,968.<\/p>\n That’s a difference of nearly 2.2-million units; at $21 each, that means that there was selling pressure in excess of $40-million hitting the market in the last half of October … readers may know that the PerpetualDiscount index fell about 2.5% in the latter half of October … and the fund<\/a> made an unfortunately early shift into this sector<\/a> at that time.<\/p>\n The fund’s raison d’etre<\/em> is to sell liquidity! There was just too much on offer!<\/p>\n According to Sentry Select<\/a>, the NAVPU of DPS.UN was 21.07 on November 28, while the market price was $20.20<\/a>. This is a discount of about 4.1% … below the 5% required to trigger Mandatory Purchases for Cancellation<\/a> … but not by much!<\/p>\n DPS.UN is still paying out an unsustainable dividend – according to the June financials, almost 28% of the 1H07 payout was return of capital, compared to 35.2% in 2006<\/a>. Redemptions of higher coupon issues may be expected<\/a> to exacerbate the unsustainability as time passes.\n<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" Sentry Select, much to my surprise, has released no news release regarding the results of their annual redemption option – I would have thought that such an announcement would be a regulatory requirement, but I’ll …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[13],"tags":[],"class_list":["post-1559","post","type-post","status-publish","format-standard","hentry","category-issue-comments"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/1559","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=1559"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/1559\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=1559"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=1559"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=1559"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}