stock and fund knowledge  

With the stock market continues to improve, the Fund’s net worth is gone up, the fund dividend fund investments become a beautiful landscape, especially the large proportion of the dividend is even more eye-catching. The face of fund dividends, many investors in understanding and behavior of the following aspects of the error. Only out of these beliefs will better investment funds.

Look at the expense of long-term investments Short-term dividends. Fund as a professional financial tools, the operation of a time and can not reflect the Fund’s overall trend. Fund dividends in a high proportion of time not to demonstrate that their long-term sustainable dividend capacity. Fund managers are accustomed to a year or two as a measure of fund performance benchmark, suffices to illustrate the operation of investment funds, should follow the cycle of the importance of the Fund. To ensure that investment income, the Fund’s allocation of varieties, the fund manager will select some varieties have a cyclical investment, which is to ensure steady income fund an important guarantee. Therefore, the Fund’s short-term dividends should be treated with caution.

That the higher net worth, the greater the profit-sharing ratio. Fund net assets of varieties of premium allocation and shrinking, not that the Fund has a dividend capacity and capability are not the only indicator of a dividend. In a particular phase or a point in time, the Fund has been substantially enhance the net to prove the market value of the Fund’s assets had increased, but in terms of income of the Fund, but remain in the book, the Fund does not form a substantial net growth. Therefore, the higher net worth does not explain the higher ability of the Fund’s dividend.

Investment funds must be dividends. Unsatisfactory performance due to operation of the face value of the fund below Ershi net, quite a few. Fund net dividend, although not fund the necessary and sufficient conditions, but is also an important basis for dividends. Fund net worth below their face value, will directly affect the Fund’s normal dividend. Therefore, investment funds, there are also faced with poor performance due to fund a result of the risk of not participating.

Dividend as possible. In fact, dividends are not necessarily the best strategy for the Fund. For long-term investment value of the Fund is concerned, investors will get more dividend yield more realistic, but also enable investors to lose their proper long-term investment opportunities. Dividends from the general situation, often accompanied by dividend fund redemptions. Fund investors will receive dividends choice can be secured, Er Shi is growing in the fund asset allocation funds have to be varieties of the passive adjustment of the stock to sell better varieties respond to redemption.

Of the indiscriminate way of dividend. Fund dividends are cash dividends and dividend re-investment in two ways. Among them, the cash dividend will reduce the Fund’s assets, the net reduction is beneficial to new investors to enter; choose dividend re-investment, it will give investors a lower purchase cost, continuous sharing of the Fund’s income, and can act as a “compound interest “investment results.