Can I participate in dividends by buying a fund the day before dividends?
You can't. According to relevant regulations, investors can enjoy dividends if they still hold fund shares at the close of the registration date of dividend rights stipulated by the fund company. On the other hand, if they don't hold the fund at the close of the fund registration day, they can't enjoy dividends. Therefore, investors can participate in dividends as long as they buy and hold them before the close of the registration day.
What are the ways of fund dividends?
There are two ways to pay dividends: cash dividend and dividend reinvestment. Among them, cash dividend means that the fund company distributes part of the 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.
Which method is better for fund dividends?
The choice of cash dividend or dividend reinvestment depends on the investor's financial situation, fund performance, investment objectives, investment risks and other factors. If the investment risk of investors is too high and there is a shortage of funds, they can choose cash dividends to recover part of the funds, and the income from fund dividends is not subject to income tax.
If the investor has sufficient funds, fails to reach the expected target, and the invested fund performs well, he can choose to reinvest the dividend to increase his holding share, and there is no subscription fee for the reinvested part of the fund dividend.