What is the difference between fund cash dividends and dividend reinvestment? Please, thank you

Cash dividends refer to a dividend method in which the company distributes a part of its earnings to investors in cash.

Dividend reinvestment means that when a cash dividend is paid, the holder uses the cash obtained from the dividend directly to purchase the dividend and converts the dividend into holding units. For ** managers, there is no cash outflow from dividend reinvestment, so dividend reinvestment is usually free of subscription fees.

**If dividends are reinvested, the increase in shares is calculated based on the net value on the day of dividends. Dividends Equity = Shares Increased.

Dividend method refers to a way of return on investment in which the company distributes a part of the income to investors. The cash dividend method is a dividend method in which the company distributes a part of the company's income to investors in cash; The dividend reinvestment method is a way for investors to reinvest the cash dividends obtained from dividends to obtain a share.

1. The return on dividend reinvestment is higher

Dividend reinvestment will be distributed cash dividends reinvested in the **or purchased**, so as to increase the original holding of ** or ** share, commonly known as "rolling interest", which can not only waive the reinvestment subscription fee, but also reinvest the ** share can also enjoy or increase the amount of the next dividend, so that the ** share can increase with the number of dividends.

2. The safety of the profit funds reinvested in the dividend is higher

**The Manager encourages investors to make additional investments and therefore generally stipulates that there is no fee for reinvesting dividends. If an investor wants to make additional investments after receiving the cash dividend, it will be regarded as a new subscription and a subscription fee will be paid. Therefore, choosing dividend reinvestment is conducive to reducing the cost of investors, and dividend reinvestment can also be the same in the case of buying **.

3. The capital turnover rate of dividend reinvestment is high

Choosing to reinvest dividends is beneficial to reduce costs for investors. At the same time, if you choose the dividend reinvestment method, you can enjoy the compound interest growth effect of ** investment appreciation.

Cash dividends are the ones that give you cash when you pay dividends and return them to the card you bought. If it is a dividend reinvestment, it will give you a share of **. It can also be understood as converting the cash of dividends into ** shares. Choose according to your needs before the dividend.

These are two different things, the former is the dividends from the funds you have invested, the latter is whether the living money should be invested again, and the dividends shared by the former are the living money.

Personally, I would recommend you to choose dividend reinvestment.

We can understand it this way, we choose to invest ** is to achieve compound interest value through investment**, if you choose cash dividends on the ** dividends, this time will not produce a snowball effect, your wealth is difficult to grow. If you don't need the money in a short period of time, you can choose to reinvest the dividends.

First, let me first talk about the basic situation of the first dividend.

There will be a lot of information about dividends on the Internet, and there will also be a lot of self-leading articles, but these articles basically don't get to the point. You can understand the concept of dividends in this wayWhen the manager feels that the current asset value is too high, on the one hand, in order to maintain his investment performance, but also to ensure the return on investment of the previous investors, he will choose to reduce the way of dividends。It is precisely for this reason that the concept of dividends is actually taking the investor's money to the investors themselves, and the concept of dividends that many people understand is not the same as the essence of dividends.

Second, it would be better to reinvest dividends.

As I mentioned above, we invest** in order to earn a compound interest value. If our ** product is divided, at this time our corresponding position will be reduced, although we seem to make money, but in fact the money itself is part of our cost. If we choose to reinvest dividends at this time, our investment behavior will generate compound interest value.

3. There is only one benefit to cash dividends.

If you want to talk about the benefits of cash dividends, the only benefit of cash dividends may be that you don't have to pay taxes. For most small partners, many people will default to cash dividends when subscribing to ** products, and you need to take the initiative to adjust at this time, and it is best to set the cash dividend as a dividend reinvestment. If you're not in a particularly urgent need for money, cash dividends won't have any effect on your finances at all.

**Select the bonus and then invest well. Because if you choose to reinvest in dividends, it can have a snowball effect.

If it is a low-risk **, the use of dividend reinvestment can naturally create more interest, but for the high-risk **, the use of dividend reinvestment is likely to increase the risk, for example, if I hold ** today ** is 10,000 yuan, the next day up 10%, **value will**11,000 yuan, but if it falls by 10% on the third day, then **** will become 11,000 * 90% = 9,900. The rise and fall are the same, but in fact, the value of ** has decreased.

Cash dividends are better. This approach will be more reliable, and there will be no bad situations in this way. And they will also get the corresponding money.

Of course, it would be better to choose cash dividends. Because this allows you to get your earnings as quickly as possible, and you can witness your earnings immediately.

If you are more optimistic about this**, you can choose dividends and then invest, if you feel that the risk is relatively large, if you want to protect the capital, or choose cash dividends. Because it's safer.

In terms of **, there are two professional terms called cash dividends and dividend reinvestment, and there is a certain difference between the two. There is a big difference between cash dividends and dividend reinvestment, first of all, the two are different by definition, cash dividends are distributed in cash to the best investors, and dividend reinvestment is to directly reinvest profits into ** in order to obtain higher income. After understanding this concept, I believe you have a simple understanding of the difference between cash dividends and dividend reinvestment.

First, the rate of return of the two is different. First of all, from the perspective of the rate of return, the rate of return on cash dividends and dividend reinvestment is different. Generally speaking, the rate of return on dividend reinvestment is relatively high, because the cash obtained from the investment is invested in the ** again, or the ** purchased, which increases the original ** share, which forms a kind of interest rolling effect, which can not only reduce the subscription fee for reinvestment, but also participate in the amount of the next dividend.

Second, security is different. In addition to the difference in the rate of return, the security of cash dividends and dividend reinvestment is also different. In general, they are advised to reinvest dividends, as there is no fee for reinvesting dividends.

However, if we are paying cash dividends and want to make additional investments, it is a new subscription, and we need to pay a subscription fee. Therefore, for investors, dividend reinvestment is more secure.

Third, the capital turnover rate is different. From the perspective of capital turnover, it is also different. Dividend reinvestment can effectively reduce the cost of investors, in addition, if it is open-ended, if you want to hold the investment for a long time, you can choose the way of dividend reinvestment, you can enjoy the compound interest growth effect of investment appreciation.

It is precisely because of these differences that I recommend investors to choose the way of dividend reinvestment.

Cash dividends refer to a part of the company's earnings, and dividend reinvestment, commonly known as profit rollover, refers to the share held by ** when cash dividends are made, and the subscription fee for reinvestment can be waived. Cash dividends, to a certain extent, can reduce investors' losses

Dividend reinvestment is the conversion of dividends into shares, while cash dividends are transferred directly to the investor's bank account in cash. If there is no special choice when buying**, cash dividends will generally be defaulted, which is something that investors need to pay attention to. And it has to be said that if the dividend method chosen by investors is dividend reinvestment, then the ** share held after the dividend will increase.

Funds dividends are generally in a period of time, the manager will give you the income in this, the balance of the treasure, which is equivalent to the reinvestment of dividends is equivalent to continuing to invest your income, and it is more cost-effective to choose dividends to reinvest, after cash dividends, your share will become less, and after the dividend reinvestment, your share will become more, no matter what, these funds are yours, when you reach a certain income, you must be in the pocket in time.

Cash dividends and dividend reinvestment, these are the two modes of dividends. Cash dividends, that is, when he divides the dividends, they are paid to you in cash. If it is a dividend reinvestment, he will convert this part of the dividend into a share and continue to **this**.

Like cash dividends, it is to give you the money in cash, and if it is a dividend reinvestment, it is that you put some of the benefits you get into the ** for a circular investment. In addition, their nature is also different, such as dividend reinvestment, its return is particularly high, and the security is also very high.

Cash dividends refer to the fact that the profits are directly handed over to investors, and dividends in investment refer to the investor's income will be reinvested in the project and used as the principal to obtain more profits. The selection conditions of these two investments are not the same, and the returns are also different.

Dividends are just the return of the assets in the form of cash or shares to us. Dividend reinvestment is to adjust the unit net value of ** and the share of **, the total assets of ** have not changed at all, and our assets in ** are still in **.

Cash dividends are directly transferred to your account, while dividends are converted into corresponding shares.

Cash dividends are credited directly to the account and are subject to tax. Dividend reinvestment does not need to be credited, it is directly **theral**, and there is no need to pay taxes.

Cash dividends are dividends, and the cash is directly transferred to your rolling account, and the share dividend is your dividends and subscription, which has been **, free of subscription fees.

The difference between the two is that those who choose cash dividends can only enjoy the return of the first share of the original investment, but they can use cash and avoid too much loss when the share dividend is in the first place.

So which one is good, the key lies in your judgment of the market outlook, if you feel that the market outlook has a new high, then choose the share dividend, if you are worried, then choose the cash dividend.

Extended information: 1. Dividends.

1. **Dividends refer to the distribution of net investment income to **holders after they are realized. Net income refers to the balance of income after deducting expenses that can be deducted from income in accordance with relevant regulations, including dividends, dividends, bond interest, price differences, bank deposit interest and other income.

2. Dividends refer to the distribution of a part of the income to investors in cash, which is the net value of the unit.

part. Therefore, investors actually get the assets on their books, which is the reason for the **net unit value** on the day of the dividend (ex-rights date).

2. Dividends and income:

1. Dividends are not as good as possible, investors should choose a dividend method that suits their needs. Dividends are not the biggest criterion for measuring performance, the biggest criterion for measuring performance is net worth.

growth, and dividends are nothing more than the realization of the growth of the net worth.

2. For open**.

If investors want to realize income, they can also achieve the effect of cash dividends by redeeming a part of the ** units; Therefore, whether or not to pay dividends and the number of times dividends are discussed will not affect the investment income of investors.

Make a visible impact. As for the closed **.

Since **units** and **net value are often not the same, it is sometimes not feasible to achieve **profit by selling **units. In this case, dividends become the only reliable way to achieve returns. Investors should give more consideration to the factor of dividends when choosing closed-ended**.

3. Cash dividends: cash dividends are directly obtained from cash dividends, without paying redemption fees, and are tax-free, that is, they are safe in the pocket;

4. Dividend reinvestment: reinvest the cash dividends that are shared, which is commonly known as **"Profit rolling"In doing so, the subscription fee for reinvestment can be waived, and the ** share obtained from reinvestment can also enjoy the next dividend.