Should the fund pay dividends after all?
Explain it to you in common language.
First of all, you should understand what is fund dividend, and give a simple example:
For example, you have a fund with a share of 1 000. At present, the net value of the fund is 1.56 yuan, and the market value is 1.56 yuan. Now each fund has to pay dividends to 0.2 yuan;
1. If you choose cash dividend, then your net fund value is only 1.36 yuan, and its market value is 1360 yuan, that is, after dividend, you will be given your original fund value 1560 yuan cash 200 yuan, and the remaining fund market value 1360 yuan will be the same as before dividend. So after the cash dividend, your funds have not increased. The only advantage is that dividends are free. If you need money and want to redeem some funds, you can save the redemption fee, which is generally 0.5%.
2. If you choose to reinvest in dividends, your 200 yuan will be converted into fund shares again, so that the market value of your fund will remain unchanged. Also remind you that there is no subscription fee for converting dividends into fund shares.
According to the above description, whether the fund is divided into dividends or more points and less points does not explain the quality of a fund, or it depends on the performance of the fund or the current net value of the fund, mainly depending on the combination of the time when the fund was established and the accumulated net value.