Two Closed-end Buys

Article Excerpt

CANADIAN GENERAL INVESTMENT TRUST $21 (Toronto symbol: CGI) mainly invests in shares of Canadian companies. Its discount to its net asset value now stands at 18%. THIRD CANADIAN GENERAL INVESTMENT TRUST $42.75 (Toronto symbol: THD) holds around 55.8% of its assets in units of Canadian General Investments. The rest of its holdings are mostly high-quality income trusts and stocks. The trust’s discount to its net asset value is 14%. Since Third Canadian trades at a discount to its asset value, as does its main holding, Canadian General, you might say Third Canadian in effect trades at a “double discount” of approximately 18%. The total MER for Third Canadian, including the MER paid on the units of Canadian General it holds, is 1.9%, a bit above the 1.7% MER on Canadian General. Third Canadian holds 12.1% of its assets in foreign stocks, while Canadian General holds only Canadian stocks. Third Canadian has somewhat more potential than Canadian General Investments due to the double discount. But…

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