ECN Capital Corp ECNCF

Ecn capital gains implication question.

[Blueswin]

I  am sure most people on the board would think ECN's price @ $10-$11 is dicounted because of the value of both the remaining compainies Kessler & Tirad. But does it make sense if one is new to investing into ECN  (even at this discounted price) because they would need to claim the $7.50 in capital gains implications? Does it make more sense to wait until the dust clears & the $7.50 is paid & then buy in? Am I missing something? Of course if you are buying in TFSA oe RRSP it wouldn't have the same tax implications. Any thoughts?

[Blueswin]

And then there was silence! Does anyone have any thoughts about the capital gains implications?

[pierrelebel]

Blueswin wrote "...because they would need to claim the $7.50 in capital gains implications?" ??? There is no such thing as a claim for $7.50 "capital gain". After the distribution of the dividend, the shares should drop by $7.50 (give or take a bit). Except for trust accounts (RRSP, TFSA, etc...) the dividend will need to be reported in the year it is received.  The

[Blueswin]

Thank you that was very helpful. My bottom line question was why would a person take a new position in ECN today, why not wait until the dividend is paid & the share price drops the $7.50? One of the good reasons you gave is that if bought today $10.70 - $7.50 drop after the dividend is paid leaves with getting shares at $3.20 for example instead of paying @ the possible $4-$5 range. But

[pierrelebel]

Blueswin asked "why not wait until the dividend is paid & the share price drops the $7.50?" Look at the following possibility: Dividend is payable January 2022 and goes ex-dividend mid December 2021 Someone buying 1,000 shares today would receive a dividend of $7,500 in 2022. If such buyer is a senior living in Ontario (for example) no tax is actually payable on "eligible

[Blueswin]

Thank you for this! Very well thought out!