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Contemplating leveraged investment

6500 Views 13 Replies 11 Participants Last post by  DrStan
Hi There,

I have the opportunity to borrow $50k at prime divided by 2 with payments as low as interest only. My plan is to leverage these funds to invest in income genrating stocks/trust units and use the monthly income to payback borrowed money.

We are comfortable with the risks associated with leverage (we use the Smith Manoeuvre to invest in income properties)

We also currently invest in stocks, REITS, Income Trusts and several ETFs (all within RRSPs). We also have a lot of exposure to banks (both Canadian and US).

Any suggestions for high-income-yielding investments?

I have been contemplating: day.un, cgx.un, erf.un, ba.un, liq.un, ala.un, bnp.un

The income from these units more than covers the interest due on the borrowed money.

Any other suggestions and insight is greatly appreciated.

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EIF-T is one that would fit your criteria. It has an impressive board of directors. I am heavily invested in it and enjoy the 13% return (based on my book value). Also it has already converted from an income trust to a corporation and the dividend/distribution is now taxed less.
1 - 1 of 14 Posts
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