In fact, fund dividends will not increase our income, but only reduce the net value and return some assets to us in cash. Equal to the money in the left pocket, put it in the right pocket, and our assets have not increased.

Although dividends can't increase our total assets, they play a very important role.

First, if you accumulate a certain share, you can get a relatively stable cash flow. If you want to achieve financial freedom, you must have a steady cash inflow every year. Dividend income is a huge passive income.

Second, dividends include dividend reinvestment and cash dividends. If you choose cash dividend, you can redeem some fund assets without paying redemption fees. If you choose to reinvest in dividends, you can convert the money into corresponding fund shares without paying subscription fees.

Should investors choose dividend reinvestment or cash dividend? You need to decide according to your own situation.

If you are still optimistic about dividend-paying funds, you can set up dividend reinvestment at this time to avoid buying or buying in cash after cash dividends, and pay an extra handling fee for nothing.

If you already want to stop profit or get some cash flow, you can take advantage of this opportunity, without paying the redemption fee.

Dividend during the bull market, especially in the middle and late period of the bull market. There are few investment opportunities in the market and too much money in hand. Some fund managers will help investors lock in the current income through dividends, and fund managers can also lighten their positions in this way.

Reduce the net value, make the fund look "very cheap", thus increasing sales. This move is very attractive to small white players. Because it is easy for people to have a psychological feeling, things with low unit price look very cost-effective, and in the investment field, this psychological feeling will still be accompanied.

Make your fund sell better, thus increasing the size of the fund. People always think that funds that can give dividends to everyone stably are generally not very bad. Fund companies will take this as a big selling point, vigorously promote and expand sales.

Matters needing attention in fund dividends

1. Generally, before dividends are distributed, the on-site fund will suspend trading for one hour on a certain day, and the time is 9:30- 10:30.

2. Investors can only make cash dividends on the fund shares managed by the securities registration and settlement system (i.e. on-site). The fund share dividend distribution method of the entrustment registration system (that is, off-site) can be cash dividend distribution or dividend reinvestment. For investors who have not chosen a specific dividend method, the default dividend method of the Fund is cash. (To put it bluntly, if you want to reinvest in the on-site fund, you must transfer the on-site fund off-site and set it as dividend reinvestment)

3. Fund share holders can choose or change the dividend distribution method at the fund sales outlets during the trading hours of each fund open day (limited to fund shares managed under the registration system (i.e. off-site). The dividend distribution method of investors who purchase the Fund over-the-counter shall be subject to the dividend distribution method confirmed by investors through the last relevant selection (or modification) of the Fund before date of record (excluding date of record).