Dividends on ETFs
Many exchange-traded funds (ETFs) distribute dividends to their shareholders on a regular basis, just like individual stocks. Dividends are typically paid in cash, but may also be paid as additional shares of the ETF.
The amount and frequency of dividends paid by an ETF will depend on the underlying holdings of the ETF and the policies of the ETF. Some ETFs may pay dividends, others may not.
Accumulating ETFs (reinvest dividends) and distributing ETFs (pay out dividends) are two types of ETFs that differ in how they handle dividends and other income generated by the underlying securities held within the fund.
For more information on dividend payments, please review the relevant ETF’s documents, such as the prospectus or KID.