Dividends with Acc Funds?

Lokolo

Ok I have invested some money into Rathbone Global Opps. Now, its an accumlution fund, however, the fund factsheet (http://www.rutm.com/downloads/fund-factsheets/rathbone-global-opportunities--8-2008_1005.pdf) has 2 distribution dates.

One being at the end of this month, I am wondering what will actually happen?

Will the fund value rise on the 30th September because of dividends or what?

oldfella

yes - acc funds have dividends built into the price

Aegis

Lokolo wrote: »

Ok I have invested some money into Rathbone Global Opps. Now, its an accumlution fund, however, the fund factsheet (http://www.rutm.com/downloads/fund-factsheets/rathbone-global-opportunities--8-2008_1005.pdf) has 2 distribution dates.

One being at the end of this month, I am wondering what will actually happen?

Will the fund value rise on the 30th September because of dividends or what?

Essentially what it means is that the dividends that would be distributed will instead automatically be reinvested. This should have the effect of leaving the unit price alone rather than causing it to go up, as the usual case is that share prices tend to drop by about the dividend value when they go ex-div. From what I've seen anyway.

Lokolo

So basically I don't see the difference but the fund manager will (on 30th September) have loads of money to then spend on more shares in companies etc.?

RayWolfe

No.
The dividends from the underlying investments come in all the time. They will be added to any cash in the fund and used to buy new holdings or to fund people cashing out of the fund. The fund dividend is paid to inc unit holders and reduces the value of the inc units. Meanwhile acc holders have the value of their units increased by the amount of the dividend but not as a sudden increase because, as I said the underlying dividend come in all the time but when they are paid to the fund the value of the underlying share will reduce by the amount of the divi.
Clear as mud? Great! ;-)

Lokolo

RayWolfe wrote: »

No.
The dividends from the underlying investments come in all the time. They will be added to any cash in the fund and used to buy new holdings or to fund people cashing out of the fund. The fund dividend is paid to inc unit holders and reduces the value of the inc units. Meanwhile acc holders have the value of their units increased by the amount of the dividend but not as a sudden increase because, as I said the underlying dividend come in all the time but when they are paid to the fund the value of the underlying share will reduce by the amount of the divi.
Clear as mud? Great! ;-)

Ok understand most of it.... it'll do