One is cash dividend and the other is dividend reinvestment.

The default is cash dividend.

The difference between the two:

Cash dividend: cash dividend is a direct cash dividend, which does not need to pay redemption fee and is tax-free, that is, it is safe to leave the bag;

Dividend reinvestment: reinvesting cash dividends in the fund, commonly known as "accumulated interest", can not only avoid the subscription cost of reinvestment, but also enjoy the next dividend of the fund share obtained by reinvestment.

Investors choose to pay dividends in cash, and the dividends will be transferred from the fund custody account to the bank deposit account designated by the investors on the dividend payment date;

Dividend reinvestment is a kind of service provided by fund management companies to investors. The dividend obtained is directly reinvested in the fund, which is equivalent to the income distribution of listed companies in the form of share delivery. If investors don't need cash for the time being, they can choose dividend reinvestment. In this case, the dividend funds will be converted into corresponding fund shares and credited to the investor's account, and the reinvestment fee is generally exempted.

For closed-end funds, because the fund share is fixed, the income distribution can only be in the form of cash, and so is ETF.