Why should bond dividends be deducted?
The reason why bonds need to deduct dividends is because the dividends of fund bonds are basically the same, so the default is cash dividends, but a large proportion of cash dividends will affect the fund's net value. If the net value of the fund declines, the principal will naturally start to decrease, but in this case, the funds that investors can buy will not decrease, but will increase, so there is no difference in general.
What are the benefits of bond dividends?
1, hedging: when the bond market is running at a high level, it is mandatory to realize part of the cash in the fund, which can avoid excessive losses when it falls and help investors settle down;
2. Control the scale: when the fund scale is too large, it will affect the investment decision of the fund manager and the liquidity of the market. Personally managed bond funds can actively reduce the scale through dividends;
3. Improve the income: When it is relatively difficult to invest in the bond market, you can increase the user's income rate and cash flow through dividends.