Income vs accumulation funds

RL11

How can I actually tell what my gain is from holding accumulation shares in terms of growth and reinvested "dividends"? If I choose an Income fund, I can clearly see if the price of the fund has increased and I know what dividend I have been paid, so I know exactly what I've gained (or lost!). With Accumulation units, how do I know whether the fund is really growing in value? i.e. couldn't it be losing value, actually only being propped up by reinvestment of good dividends which may not continue. Each fund manager, is presumably deciding each day to increase (or decrease - does that ever happen), the value of the units? Or am I looking for too much detail!

Lokolo

richlidd wrote: »

How can I actually tell what my gain is from holding accumulation shares in terms of growth and reinvested "dividends"? If I choose an Income fund, I can clearly see if the price of the fund has increased and I know what dividend I have been paid, so I know exactly what I've gained (or lost!). With Accumulation units, how do I know whether the fund is really growing in value? i.e. couldn't it be losing value, actually only being propped up by reinvestment of good dividends which may not continue. Each fund manager, is presumably deciding each day to increase (or decrease - does that ever happen), the value of the units? Or am I looking for too much detail!

I think you are getting confused.

The Acc is exactly the same as Inc, it shows the days value. However, there won't be a dividend.

http://www.h-l.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/f/fidelity-special-situations-accumulation

The value today is 1770p. Tomorrow it could be 1800p or whatever.

If you compare and Inc with Acc you will see the graphs are identical apart from the Acc rises (assuming we have a fund which is rising) faster than the Inc.

RL11

Probably just me that's confused!
If the unit price of an Inc is 1700 and it goes to 1750 AND I get a 50p dividend, I can clearly see that the fund has grown 50p and the dividend is 50p.
If the unit price of an ACC is 2500 and it goes to 2600 what proportion is growth and what is reinvested dividend? e.g. the fund could have dropped in value by 20p but had 120p re-invested?
Or maybe it's grown by a 100p and the fund manager isn't reinvesting anything! How do I know??? Or doesn't it matter???!!!

dunstonh

If the unit price of an ACC is 2500 and it goes to 2600 what proportion is growth and what is reinvested dividend? e.g. the fund could have dropped in value by 20p but had 120p re-invested?

You still get supplied with the amount of distributions on ACC units. Usually thats for tax purposes but in your case you can use that information to see how much the income was in that period.

RL11

OK. So I'm going to have to wait for an annual statement before I can really see what "income" was reinvested? I'm new to investments, so although I appreciate these things are long term, I'm keen to understand how it all works, so I better understand what I'm doing!!!