tag:blogger.com,1999:blog-5433839636644874439.post784336550517532772..comments2024-03-04T13:37:11.022+00:00Comments on Canadian Financial DIY: Budget Shoots Down Tax Advantaged Swap and Forward-based ETFsCanadianInvestorhttp://www.blogger.com/profile/05645767559302303541noreply@blogger.comBlogger4125tag:blogger.com,1999:blog-5433839636644874439.post-794291032469153322013-03-26T19:03:07.483+00:002013-03-26T19:03:07.483+00:00CC, The thing that gets me is that the budget also...CC, The thing that gets me is that the budget also says the funds it is after could already be pursued under existing law and the new action merely makes it easier. Perahps the biggest protection for HXT is that it merely transforms what is mainly dividend income into capital gains, which in some tax brackets is taxed less and in others more. So maybe the CRA would not think there is enough tax to gain to be worth roping in HXT, though the indefinite deferral of paying tax is another tax leakage. HXT's implicit automatic costless reinvestment is certainly worthwhile as evidenced by its outperformance in 2012 of its physical iShares counterpart XIU by 8.1% vs 7.8%CanadianInvestorhttps://www.blogger.com/profile/05645767559302303541noreply@blogger.comtag:blogger.com,1999:blog-5433839636644874439.post-61409437135678018872013-03-26T17:14:16.435+00:002013-03-26T17:14:16.435+00:00I looked up your post after reading the press rele...I looked up your post after reading the press releases from iShares and Horizons. It appears that Horizons expects HXT not be affected by the Budget measure because (a) its derivative contracts are of the swap variety and (b) it does not distribute income.<br /><br />Still, I think that tax changes should be considered a risk in holding HXT.Canadian Capitalisthttp://www.canadiancapitalist.comnoreply@blogger.comtag:blogger.com,1999:blog-5433839636644874439.post-86191352410107687082013-03-24T22:20:18.341+00:002013-03-24T22:20:18.341+00:00TE, I'm not sure anyone can be certain of the ...TE, I'm not sure anyone can be certain of the outcome. The budget speech is not the law/regulation so maybe the feds will be sure to include HXT, maybe they will let it escape. When you make the rules, you can make the results come out as you wish.CanadianInvestorhttps://www.blogger.com/profile/05645767559302303541noreply@blogger.comtag:blogger.com,1999:blog-5433839636644874439.post-4990899976879875622013-03-24T20:56:35.605+00:002013-03-24T20:56:35.605+00:00The press release suggests HXT will not be affecte...The press release suggests HXT will not be affected because it has never made a distribution and doesn't expect to. Should it make a distribution, however, then perhaps it will be as income/dividends?Tracking Errorhttps://www.blogger.com/profile/14968429880997516641noreply@blogger.com