- Investment trusts are the most closely related to mutual funds as they are operated in the United States. These trusts hold ownership in collections of stocks, bonds and the various kinds of futures traded on public stock exchanges. Profits from these properties in the form of dividends are paid out to investors through the trust. Under Canadian law these forms of investment are exempted from any personal income tax that has to be paid.
- Real estate trusts own various forms of real estate and mortgage securities. The money made from either the rent or sale of these properties is paid back to investors in the trust. Real estate trusts allow for investors who are interested in real estate to become involved with less risk, as their money will be spread into a diversity of different investments. As with mutual funds, real estate trusts often market their expertise at investment.
- Energy trusts hold investments primarily in oil wells and other areas with natural resources. The potential gains from such investments are great, and so a well-managed trust has the potential to substantially reward its investors. As time has gone on, the oil and coal industries have become a larger part of the Canadian economy. Many new oil deposits have been discovered. This has made energy trusts an even more appealing investment for some.
- Business trusts are a collection of stock shares in a single business. These are primarily created by businesses themselves in order to escape certain taxes for themselves and investors. An investment in a business trust carries the same kind of risk as a more traditional investment in stock would. Changes to the Canadian tax code have made business trusts less appealing than in the past and so they are less common today.
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