Ben ChengCustom Direct Income FundCDI.UN.TOTRADEFeb 25, 2006

An unusual income trust in that 100% of its business is in the US, so won't be taxed under the new legislation. Produces cheques for individuals and companies. Average household writes 20 cheques a month versus 2 in Canada. Payout ratio is pushing 100%.

Currency conversion directly affects their free cash flow from US to Canadian dollars. Payout ratio is over 100%. Have done a good job of mitigating a very difficult change in currency.

They have a long-term hedge in place for currency. Payout ratio is a little higher than he likes. Has been beaten down, but not sure why. This is reasonable value.

Likes their strategy of putting logos on cheques. A lot of exposure to the US$ has created a broad sell off. Pays a pretty good yeild.

Could have potential risk if legislation is changed regarding taxability of US domiciled businesses. Has a lot of competition. Prefers others.