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Boston Pizza Income Fund A Tasty Investment

04/14/11 08:36:36 AM
by Koos van der Merwe

When times are tough, traders turns to interest and dividends.

Security:   BPF.UN-T
Position:   Buy

Boston Pizza Income Fund (BPF.UN) is a limited-purpose, open-ended trust established under the laws of British Columbia, Canada, to acquire indirectly certain trademarks and trade names used by Boston Pizza International ("BPI") in its Boston Pizza restaurants in Canada. The trademarks are licensed to BPI for 99 years, for which BPI pays the fund 4% of franchise revenues of all Boston Pizza restaurants in the royalty pool. On April 8, the fund announced a cash distribution to unitholders of 8.4 cents per unit for March 2011. The price of each unit is currently $14.09, which is 7.15% yield.

FIGURE 1: BOSTON PIZZA, DAILY
Graphic provided by: AdvancedGET.
 
Figure 1 is a daily chart and shows the following:

1. A JM internal band. The share price is currently trading within the band, not giving a buy or a sell signal. The JM internal band is a 15-period moving average offset by 2% positive and 2% negative. A break above the upper band is a buy signal, while a move below the lower band is a short signal. The red line is the 15-period simple moving average, which closes the position if broken.
2. The relative strength index (RSI) line is moving up, suggesting a bull trend.
3. The chart shows that a triangle formation is developing, suggesting a target of $18.15 ($15.11 - 11.00 = 4.11 + 14.04 = 18.15).

With a yield of 7.15% and a target price of $18.15, the share is a good investment.




Koos van der Merwe

Has been a technical analyst since 1969, and has worked as a futures and options trader with First Financial Futures in Johannesburg, South Africa.

Address: 3256 West 24th Ave
Vancouver, BC
Phone # for sales: 6042634214
E-mail address: petroosp@gmail.com

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