Royalty Income Trust

(redirected from Royalty Income Trusts)

Royalty Income Trust

A unit investment trust in which the trustee buys the rights to income from a natural resource, such as oil or real estate, and distributes the profit to beneficiaries. A company, such as an oil company, may sell the right to income from an oil well to a royalty income trust because it usually pays more than other ways of raising capital. Likewise, an investor may be interested in buying into such a trust because yields are often higher than stocks or bonds. For example, an oil company may sell oil wells to a royalty income trust instead of issuing stock or a bond in order to raise capital to increase its capacity for pumping oil out of the ground.
References in periodicals archive ?
As an asset class in Canada, the Royalty Income Trusts have become increasingly important.
We are delighted to have this opportunity to bring Standard & Poor's global indexing expertise to Royalty Income Trusts," said Glenn Doody, Director, Canadian Index Operations, Standard & Poor's.
In addition to an overall index for Royalty Income Trusts, Standard & Poor's will calculate sub-indices for REITs and the energy sector.
Royalty Income Trusts were removed from the Canadian indices in 1995 for failure to meet TSE 300 Criteria for Inclusion guidelines.