Sent: Monday, August 09, 2010 4:11 PM Subject: Risk/Reward Vol. 13 Since I began my search for yield, I have been intrigued by oil and gas royalty trusts. If you believe like I do that oil will be at $75+/barrel for the foreseeable future, I suggest you investigate these trusts. As the name suggests, they are nonoperating entities which serve as vehicles to pass income through to the unit holders. Due to tax issues, I am purchasing these in the 401k. There are several from which to choose. I bought BPT, SBR and PBT each of which pays a 7+ % annual distribution. Note, each of these are US trusts. Canadian trusts are also attractive but they are undergoing tax conversions, a topic which is beyond the scope of this post. Late last week, I uncharacteristically purchased GRU on a dip. It is an agriculture ETF weighted 45% in wheat. If wheat goes to $12/ bushel like in 2008, this could be a double. All it has done in my hands is stay even or go down. I also added to some positions today. I continue to add NGG which is up 10% from my June purchase and 14% from my early July purchase. This is a British utility that also owns assets in the US and throughout the world. I bought it for its outsized dividend (which is unpredictable because it is a British payor) , but also as a pound/dollar hedge which I believe is the real reason for its recent healthy gain.