What is the Dividend Fund?
The Dividend Fund is a mutual fund with a basic investment strategy for the purchase of shares in companies that pay dividends. The Fund provides investors with a regular revenue because dividends are regularly paid to holders of the shares of the mutual fund. Investing in companies that pay dividend is the opposite strategy for investment in companies trying to maximize the price of their shares by investing profits back in the company. The average mutual fund focuses on the evaluation of capital or on the estimate that the price of the company's shares will increase, which increases the value of the shares held by the fund. However, this is not the only investment strategy. The Dividend Fund aggregates companies that distribute profits in the form of dividends to shareholders rather than reinvesting profits in society to increase its value.
Investor who chooses the Dividend Fund over the Capital Fund is probably trying to holdet with your investment for a longer period of time. The aim would be to use the distribution of investments as a source of annual income rather than an investment that could be sold to gain the advantage of award -winning stock price at any time. That is why the Dividend Fund is considered to be the type of income fund.
Revenue funds are particularly popular in Canada. The Canadian government has established a number of types of entities such as licensing trust and confidence in income that has special features to distribute profits back to investors. Canadian companies are often well represented in revenue funds based on stunning for this reason.
As with any mutual fund, the Dividend Fund is professionally managed by financial companies that specialize in determining which companies should be included in the fund. Investors are charged a fee for this service, which may undermine the value of dividends. It is important to compare the percentage return on investment with the percentage of paid fees.Generating income can be a goal in itself, but can only add an analysis of whether the same investment would ultimately earn more money if it invest in another way.