iShares Core Canadian Short Term Bond Index ETF T.XSB

Distributions and Value

[YYZGUY]

Every time there is a distribution, the value of our units drops by the same amount. Doesn't this mean that we are essentially earning income (from the distribution) that is fully taxable in return for a capital loss (from the decrease in value resulting from the distribution) which is only 1/2 taxable? Notwithstanding related commissions, wouldn't it make sense to sell the day before the distribution (high value) and re-buy the day after the distribution at a lower value effectively then making the value of the distribution a capital gain (1/2 taxable) instead of getting the distribution. Am I missing something here? Thoughts and comments?

[MLEMC]

It's a bond fund... so I think your analysis is pretty well on. The issue becomes trading in and out at the appropriate times... I think you'll find that easier said than done, but good luck if that's what you are up to. I only hold this in a tax-sheltered account for the very reason you speak of. Easier than building ladders and at the MER gives you a nice distribution across