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/biz/ - Business & Finance

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1032875 No.1032875 [Reply] [Original]

How do index funds and ETFs deal with dividends? Do I get a cheque in the mail from every company that the index fund holds during their payout periods?

>> No.1032894

You get a single distribution, usually quarterly, aggregating all the dividends for that period. That distribution will be paid in cash or reinvested depending on the options you established when you created your account.

>> No.1032897

>>1032894

Cool, so the fund owner gets the cheques from the various companies and split them up to us retail plebs.

Do all companies payout dividends at the same time or is this standardized across the financial world?

>> No.1032904

>>1032897
>Do all companies payout dividends at the same time or is this standardized across the financial world?
Not every company pays a dividend, and there is no fixed standard for those that do. Usually, but not always, distributions are done quarterly, to coincide with the release of the company's financial statements.