2

If a mutual fund or the etf gives distributions on a monthly basis, Will I get the distributions from the first month I invest in?

huab
  • 947
  • 6
  • 14

2 Answers2

6

If you own an ETF, mutual fund or stock when the stock goes ex-dividend, you'll receive the dividend/distribution on the Pay Date.

Bob Baerker
  • 77,328
  • 15
  • 101
  • 175
1

Yes, but note that it's not "free money". All else being equal, the value of the ETF will drop by the amount of the dividend since it's a reduction in the fund's net assets. So If you pay $100 per unit for one unit of a fund and it pays a $5 dividend the next day, you'll then have $5 in cash and a $95 unit of the ETF.

Dividends do not increase wealth; they are just a way to get cash to the owners of the ETF without forcing them to sell their shares.

D Stanley
  • 145,656
  • 20
  • 333
  • 404