What's the difference between stock dividends and fund dividends?
Dividends are divided into two ways: dividend reinvestment and cash dividends. The difference between these two methods is that one is simple interest appreciation, while dividend reinvestment is compound interest appreciation. Therefore, most customers prefer to choose the way of dividend reinvestment. 958264 Fund dividend: Fund dividend means that the fund distributes part of the income to fund investors in cash, which was originally a part of the net value of the fund unit. Therefore, investors actually get the assets on their books, which is why the net value of fund shares fell on the day of dividends (ex-dividend date). Dividends are not as much as possible. Investors should choose a dividend distribution method that suits their own needs. Fund dividend is not the biggest standard to measure fund performance. The biggest criterion to measure the fund's performance is the growth of the fund's net value, and dividends are just the cash for the growth of the fund's net value. For open-end funds, if investors want to realize income, they can also redeem part of the fund shares to achieve the effect of cash dividends; Therefore, whether the fund pays dividends and the number of dividends will not have a significant impact on investors' investment income. For closed-end funds, because the unit price of the fund is often different from the net value of the fund, it is sometimes not feasible to realize the fund income by selling the fund unit. In this case, fund dividends become the only reliable way to realize fund income. Investors should pay more attention to dividends when choosing closed-end funds. Cash dividends: Cash dividends are direct cash dividends, and there is no need to pay redemption fees. The skirt is 958264 and tax-free, that is, you can leave immediately. Dividend reinvestment means reinvesting cash dividends in funds, commonly known as "accumulated interest". This can not only avoid the subscription fee for reinvestment, but also enjoy the next dividend of the fund share obtained by reinvestment. Skirt 958264