Monetary fund is also a kind of fund. Compared with other types of funds, money funds have the least risk. The main investment object of the money fund is low-risk money market instruments. Money funds have the characteristics of high security, high liquidity and stable income, and are the first choice for many investors to invest in funds. General funds will also have dividends, so does the money fund have dividends? Let's get to know each other.

Does the money fund pay dividends?

Money funds also have dividends, but for money funds, dividends can only be reinvested, not cash dividends. Strictly speaking, dividend reinvestment means that when the money fund pays dividends, it directly converts dividends into fund shares and distributes them to investors according to the net value of the money fund, which increases the holding share of investors.

There is usually no fixed time for fund dividends, and fund dividends can only be paid when the fund has distributable profits. In addition to dividend reinvestment, there is also a cash dividend method, that is, the distributable profits of the fund are directly distributed to investors in cash.

In fact, fund dividends are essentially a part of the fund's net assets allocated to investors. Often after the fund pays dividends, the unit net value of the fund will also decline. Of course, the total assets of the fund held by investors themselves have not changed, which will not have any adverse impact on investors holding the fund.