Paramount Energy Trust (NASDAQOTH:PMGYF.PK)

Speculative buy - this might be close to the price bottom.

Oil prices will rise due to the added pressure on middle east reserves. Until the U.S. decides to drill in the Northwest (the largest oil reserves in the world), Oil prices will continue to rise.

This is my top holding. I love their focus on shareholder value. I am also very bullish on Natural Gas, 3.90 looks like a major floor and PMT is a natgas story. I believe management will value their shareholders going forward as they convert to a corporation.

NG play

Note that the Fool has not figured out how to calculate the dividend on this symbol. So, you may be rating this one because of the fat divi but in reality you should only pick this one on price (it has its moments).

Pure Natural Gas play. They have the lowest payout ratio of all the trusts, which keeps the distribution stable and allows them to spend money on building the reserve life. They manage their hedges well which also helps keep dividend stable. They have currently been paying $0.10 CDN per month giving a 15% ARR at an $8 unit price. If NG falls back to $7- $8 this year they will still be paying $0.10 CDN per month because of the hedges. If NG stays above $10 they would lock in higher prices with their hedging allowing them to raise the distribution or develop their reserves to increase production. Most of their reserves are at shallow depths keeping their drilling costs low to increase production. This also gives them a high success ratio on drilling new wells. The Trust has a wealth of free information on their website. www.paramountenergy.com

I was wrong in the short term. Back to try it again.