Fund dividends are divided into two ways: cash dividends and dividend reinvestment, in which cash dividends refer to fund companies distributing part of fund income to fund investors in cash; Dividend reinvestment means that when the fund pays dividends, the fund holders convert the cash from dividends into fund shares according to the net value of the fund on that day and then distribute them to investors.

First, if the market is not good, or the fund is in a downward trend, investors can choose cash dividends, so that investors can get some cash, reduce their own losses and save redemption fees; If the market situation is good, or the fund is on the rise, investors can choose to reinvest with dividends, which can increase the share held by investors, improve the income and produce the effect of compound interest. At the same time, choosing dividends and reinvesting dividends can also save fund subscription fees.

Second, dividend reinvestment and cash dividend cannot be simply compared, but should be based on the real-time trend of funds and the broader market, such as:

1. When the market is bad or the fund is in a downward trend, the fund has dividends. At this time, it is better to choose cash dividends, because it can be safe at this time and keep part of the income;

2. When the market bottoms out or the market improves, it is best to choose dividend reinvestment, because reinvestment will buy a certain share of dividend money. If the market outlook rises, the more profit you will get from the stock. Moreover, at this time, the fund that chooses to reinvest dividends does not need to pay the subscription fee.

In addition, many fund investors can't judge whether the current market is good or bad. In this case, if they don't want to continue investing in the short term, they will choose cash dividends. If they want to continue to invest for a long time, they will choose to reinvest in dividends. At the same time, I suggest you learn more theoretical knowledge and have a general judgment on the market before you can make the right choice.

Third, the performance of the fund in a short period of time can not truly reflect the quality of the fund, and the high dividend ratio of the fund during this period can not prove its long-term sustainable dividend-paying ability. So the more dividends, the better the fund. The historical dividend situation can only give us a reference, and we must refer to whether this fund has been paying dividends steadily for many years. Generally speaking, whether a fund is excellent or not can not be simply judged by the number of dividends or the proportion of dividends, but also depends on its long-term performance.