Canadian Large Cap Leaders Split Corp. Declares Distribution: A Steady Stream of Income

As investors, we're always on the lookout for reliable sources of income. In a world where interest rates are low and market volatility is high, finding investments that provide steady, predictable returns can be a challenge. That's why the recent declaration of a distribution by the Canadian Large Cap Leaders Split Corp. (NPS) is worth taking note of.



NPS has announced a monthly non-cumulative cash distribution of $0.125 per Class A Share, representing a yield on the issue price of the Class A Shares of 10% per annum on the issue price of $15.00 per Class A Share. This distribution is targeted to be paid on December 13, 2024, to Class A Shareholders of record at the close of business on November 29, 2024.

But what makes NPS an attractive option for income-seeking investors? Let's dive into the details.

1. Dividend Yield: The declared distribution of $0.125 per Class A Share represents a yield of 10% per annum on the issue price of $15.00 per Class A Share. This is significantly higher than the average dividend yield of other dividend-paying stocks in the Canadian market, which typically ranges from 2% to 5%.
2. Consistency: NPS has a track record of consistent distributions, with the fund's investment objectives targeting a regular monthly non-cumulative cash distribution of $0.125 per Class A Share. This consistency provides investors with a reliable source of income.
3. Tax Efficiency: Preferred Share Investors may enjoy the benefit of higher after-tax returns vs. investors earning non-qualified income from investments that generate interest income from savings accounts or fixed income instruments. This tax efficiency can help maximize the returns for investors.
4. Built-In Leverage: Growth Investors can use Class A Shares to enhance their return potential through the built-in leverage created by the Split Corp's structure. This produces leverage without the typical costs associated with borrowing capital at prevailing interest rates.
5. Portfolio Composition: NPS invests in an approximately equally-weighted portfolio of Equity Securities of Canadian Dividend Growth Companies with market caps of at least $10 billion. This diversified portfolio helps to mitigate risk and provides exposure to some of Canada's most stable and profitable companies.

In conclusion, the Canadian Large Cap Leaders Split Corp. (NPS) offers investors a steady stream of income, with a high dividend yield, consistent distributions, tax efficiency, built-in leverage, and a diversified portfolio composition. As we approach the end of the year and the holiday season, investors should consider adding NPS to their portfolio to take advantage of these attractive features.

Until next month,
John, Jeff & Colin
Ninepoint Partners