How do dividends work for mutual funds?

Posted by admin on April 3rd, 2010

Recently Fidelity Low Price Stock paid dividends. The price dropped dramatically per share effectively giving me the same total $ amount as I had before the dividends. Why do they pay dividends and have the price drop at the same time?

Related Blogs

• 4 Dividend Stocks Acting Like a Money Machine | Dividends Value
• “Chloe” raises questions about sexual fidelity | Boulder Reporter
• Bank of America Declares Preferred Dividends | Press Releases …
• Treece Blog: Defending dividends | Toledo Newspaper
• Stock Market Holidays 2010 – oSeat

Posted in Dividends Tags: Dividends, fidelity, price drop, stock

« How much bonus does an investment banking analyst make ?

Does anyone have some good advice for trading stocks online? »

Both comments and pings are currently closed.

One Response to “How do dividends work for mutual funds?”

1. Yada Yada Yada says:

   April 3, 2010 at 2:44 am

   The fund (or company) only has so much money. So if they pay out money in the form of a dividend, then the remaining value of the fund or stock is less, thus the adjustment (and hence the term exdividend).

   Hope that helps!