Added 5,000 shares this morning I don't really want or need any more ENS shares but sometimes the math just says "go"
At $11.06 per share, the yield was 14.1% (or 15.3% on a 367 day basis). Of course the share price will adjust downwards by $0.13 on Friday but that is irrelevent.
A real 15.3% yield on ENB is ridiculous imo in terms of risk reward. Middlefield allocates 30% of the return as capital gains which postpones the tax payment until you sell. Therefore owning ENS carries two tax advantages (delayed tax and capital gains treatment on 30% of the divi when you do sell, and the dividend tax credit on the other 70% of the divi). ENS is a core investment for me.
I'm always keeping an eye on the math in order to try and prempt any Raises by Middlefield. Currently, the Premium to the ENS NAV is only 2% and the more important calculation of Market Value of the Unit vs the NAV of the Unit is in good shape.
I have to commend ENS shareholders for what appears to be more disciplined investing in the last couple of months. The 14% yield is great, but not at the expense of getting poked in the eye by Middlefield. I will continue to monitor the Premiums and let you know when it starts looking risky. What you do with the info is up to you.
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