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Surge Energy Inc (Alberta) T.SGY

Alternate Symbol(s):  ZPTAF | T.SGY.DB.B

Surge Energy Inc. is a Canada-based oil focused exploration and production (E&P) company. The Company's business consists of the exploration, development and production of oil and gas from properties in Western Canada. It holds focused and operated light and medium gravity crude oil properties in Alberta, Saskatchewan and Manitoba, characterized by large oil in place crude oil reservoirs with low recovery factors. It offers exposure to two of the five conventional oil growth plays in Canada: the Sparky and SE Saskatchewan. It holds a dominant land position and is drilling a mix of horizontal multi-frac and horizontal multi-lateral wells in the Sparky area. Sparky is a large, well established oil producing fairway in Western Canada. SE Saskatchewan is a focused operated asset base with light oil operating netbacks. SE Saskatchewan operates low-cost wells with short payouts and offers potential for continued area consolidation.


TSX:SGY - Post by User

Bullboard Posts
Comment by PUNJABIon Jul 23, 2015 10:17am
266 Views
Post# 23952316

RE:RE:RE:SGY short position continues to increase

RE:RE:RE:SGY short position continues to increase
CanadianBuck wrote:
I was told that a large number of shorts on Legacy reflected a complex financial construct that allows some institutions to convert interest income into tax-advantaged dividends. Possibly the large growing short position in SGY could be explained partially by this type of transaction?




So you are mad at me about my comments about your post regarding increase in SGY short position ?

Shorting SGY for interest income does not make sense.   Further to my comment on the subject. The risk involved does not justify the exposure for little to no interest income  return. Brokers have different rules for short selling. Some charge a fee for borrowing a stock & do not pay any interest on the proceeds of a short sale. These day when Bank of Canada's over night rate is only 1/2 % brokers pay no to not much interest on credit balances. Some brokers are only offering .25% interest on special deposit account where funds are separated from margin account.

When you can get no to little interest & may have to pay for borrowing shares plus pay $.025 per share monthly dividend it is not cost effective with lot of risk to short SGY just for interest income.

SGY dividend yield is now 11.54 % per annum. Which is close to about 1 % monthly cost for the short seller. No broker pays 1 % interest on deposits / free funds these days.



Bullboard Posts