I know that a lot of investors are probably disappointed with the latest dividend announcement but if you take a longer view towards this investment you might find a little solice. Ask yourself, "Do I think the price for iron ore will rise or fall over the next 5 years ?" With China, India, Brazil, etc., all growing at astounding rates, infrastructure buildout will drive increasing demand for iron ore. Don't confuse a slowdown in China's growth with a slowdown in China. China's economy is still growing at 9%, down from 15%. Iron Ore prices will slowly grow over the next 5 years and an investment in MSB will grow likewise. While you wait for stock price appreciation, you get paid a @ 7% dividend. What's not to like here ?
Yes, 7% return is on the high side. The disappointment is kind like been cheated. The cards are stacked on CLF side. The royalty calculations are impossible to verified. The IO price used is not published. James Duarde wrote an article about the left over value of BPT, another trust. From this article I believe James to be an excellent analyst, at list in analyzing the value of a trust. The BPT royalty is based on a formula publish in the bylaws, the price of oil, the inflation rate is shown, the expenses are shown. By the way BPT has become a crapshoot. With MSB it is mentioned but not quantified. On the Minnesota revenue web site, I was not able to view the state mining tax revenue. This is possible with the Alaska tax revenue web site, 2 month behind, but it is available. I do not think CLF is up and up with MSB. Yes the dividend is 7%, above average but the trust bylaws are written in favor of CLF not MSB. I will keep my position in the short term. Then day by day.