It certainly is the ore price that is having most of the impact on the royalty distribution and I believe there is some backup in inventories. Going on the current situation the historic share prices in the 30's will not be seen again for awhile but will be exceeded sometime in the future. I did a time series scatter diagram yesterday of the distributions from MSB going back to the early 1990's. It is not a linear trend - in fact it is a geometric acceleration to the upside with recent years showing larger and larger increases. The mountain in Minnesota is not running out of ore and demand for steel is going to increase pushing prices to record highs. I believe we could see annual share distributions in excess of $10 within 5-8 years if historic trends should continue.
Swing traders and dividend harvesters got burnt yesterday.
If you want to be a trader/risk taker, and only love MSB
once every 90 days playing x-date roulette? That is the risk
you take. On the other hand. That mountain of iron has
existed for millions of years, and won't be consumed in my
lifetime. Where else do you get a reliable yield of over 8%?
"Where else do you get a reliable yield of over 8%?"
If you want a reliable yield of 8%, I can point you to dozens of MLPs.
But I would not consider MSB's yield 'reliable'. You only need to look at the last 5 years to see that.
" It is not a linear trend - in fact it is a geometric acceleration to the upside with recent years showing larger and larger increases."
The trouble is that exponential functions like that in practice cannot be sustained, no more than can the exponential growth in population, debt, resource extraction and a thousand other things. At some point it all collapses on itself.
"if historic trends should continue."
Ay, there's the rub.