Q: What is your opinion of Royalty Trusts? We are retired.
A: We use royalty trusts as an income investment in our client portfolios as a diversified source of cash flow. It is important to remember that we spend 10-15 hours per week on research on these assets because they are extraordinarily volatile due to their sensitivity to commodity prices. We believe that they can be a good source of income that can counter balance other sources of income such as dividends from stocks and interest from bonds.