To some extent, the fund dividend represents the good operation of this fund. If it is just a normal dividend, it is understandable and of little practical significance to investors. If fund companies use this feature to achieve other purposes, they must be cautious. Understanding these things behind dividends will help us make better judgments.
The domestic fund market is an immature market, and most investors are afraid of high net worth funds. In order to adapt to the market and let these investors continue to buy funds, many fund companies will find ways to reduce the net value of funds, and dividends are one of the commonly used means. This is an abnormal dividend.
If a fund pays a huge dividend for the normalization of its net worth, it actually harms the interests of investors. Normalization of net value is to adjust the original rising fund net value to 1 yuan, and dividends need to be paid in cash. In order to achieve the purpose of dividends, it is necessary to lower the stock position first, so it takes a long time to adjust the stock position. If it is in a bull market, lowering the stock position will inevitably affect the income. Of course, if it is in a bear market, it will definitely affect the income.
Because the net value of the fund has been unified, just like the new fund, the stock position will remain at a low level for a period of time, so after the dividend, the fund will experience a period of stagnation of the net value of the fund and then return to normal.
The decline of fund net value after fund dividends will bring in the influx of new funds. Facing the sudden increase of fund scale, it is also a test for fund managers.
It is not impossible for the fund to reduce its net value through dividends to achieve the purpose of sustainable operation, provided that the payment of dividends is in the interests of the original fund holders.
The dividend of the fund will also affect the redemption fee. As we all know, in the fund market, people are always encouraged to make long-term investments. Therefore, in terms of redemption fee, the longer the holding time, the lower the redemption fee. Even if it is held for more than a certain period of time, it can be exempted from redemption fee, or you can enjoy free fund conversion, and some funds you hold can be exchanged for other funds of the company for free. However, if you chose dividend reinvestment when you bought the fund (most people will choose this method), you should pay attention to the fact that the share holding time of this part of the fund invested with dividend is calculated according to the dividend time. If you hold a fund, you can redeem it for free, but you just paid dividends not long ago. If you redeem some funds in your hand at this time, you will be charged a redemption fee. Many people have not noticed this.