Income Fund Vs Accumulation Fund

Accumulation funds are designed to offer growth in the fund so any dividends will be reinvested into the fund to increase the unit price.

Income fund vs accumulation fund. Usually income funds buy fixed return assets such and securities and bonds. The accumulation acc share class reinvests the income generated by the fund manager back into the fund while the income inc share class pays the income to you in cash. As a result you may receive an income from your investment at regular intervals. An income unit will distribute any interest or dividend income from the fund directly to you.

Or it can reinvest the dividends directly into the fund hence increasing its value. An income fund is a fund whose goal is to provide an income from investments. On the other hand accumulation funds automatically reinvest your profits to acquire more shares in the fund. Your profits are automatically reinvested to buy more shares in the fund.

Buying the accumulation share class would mean that your net income from fantastic fund would. This means that you can withdraw the money as an alternative income. You can choose between the accumulation or income share classes otherwise known as acc or inc. In order to identify these income funds will have inc in the fund name and accumulation funds are will have acc in the fund name.

An income fund is a type of asset allocation fund. Pay any profits to your nominated bank account. This means your stake in the fund increased and your profit should rise exponentially over time as long as the fund performs well. Such a fund is a distributing fund or etf also called an income fund.

In summary accumulation funds reinvest all income generated by the fund s assets while income funds pay out the income to investors on a regular basis. Are designed to generate growth rather than income. Such a fund is an accumulating fund or etf or a growth fund. However you could select a fund that invests purely in equity and still use it as an income fund by choosing to withdraw your profits.

Your stake in the fund grows as should your profits if the fund performs well. Whether you talk about funds or exchange traded funds etfs is the same in this context.