I don’t understand why dividends are distributed, and I don’t know the relevant steps for dividend distribution. Please give me some advice.

Also, when the net worth is low, you need to cover your position. Please give me some guidance on how to do it. Thank you.

RE: Buying a fund can be regarded as investment.

Then investment is to pursue returns, and dividends are a type of return.

There are two types of dividends: cash dividends and dividend reinvestment.

As the name suggests, cash dividends are to distribute cash to you. Of course, the fund's position will generally not exceed 95% because 5% will be reserved to deal with redemptions. When dividends are distributed, the stocks in hand will be sold to cash out.

There are two purposes for doing this. One is to attract investors. Because the net worth is at the bottom, ordinary investors think it is relatively cheap. Fund companies can use this method to attract investors' money and then cover their positions to earn more attention.

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The difference between dividend reinvestment and cash dividends is that if you distribute cash and then buy stocks, there is a subscription fee, but there is no such fee for dividend reinvestment. Generally, it is recommended to choose dividend reinvestment for long-term investment.

The concept of covering a position is actually very simple, which is to spread the cost, which is somewhat similar to the concept of fixed investment.

Because if you use the same funds to buy funds in different periods, the corresponding net values ??will also be different. Judging from the current market situation, the cost will definitely be much lower than the cost 6 months ago. If you make up some money now, it will of course be lower.

A lot lower cost.

There is a little trick for subscribing. You can check the fund trend on the day at around 14:45 on the trading day. You can use "Kuniu Real-time Market Viewer 2.0" to see the valuation of the fund on the day and whether there is a more reliable way to cover the position.

basis.

Take open-end funds as an example. When do dividends generally be distributed? If the net value is low after dividends are distributed, then positions must be covered, right?

Supplement: The concept of covering a position is not after dividends or splits, but also when the net value of the fund shrinks significantly due to the adjustment of the stock market, the position must be covered, otherwise other forms of covering up the position have no practical significance.

Because after all, only such replenishment can truly spread the cost.