The ETF thread

Hi

I was thinking of having a thread discussing ETFs. I started out in investing by going For mostly ETFs.

My top positions in my FT ISA are all ETFs.

Fun fact. I think all the top ones I have l, have the same divi schedule.

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What I’ve never gotten my head around is this. Why are they paying you a dividend to hold an ETF they put the work into keeping balanced? I mean one can copy the ETF holdings and maintain balance oneself but this is time consuming and onerous. Or costly with software. So one would expect to pay for this service, not be paid for it. Or does one only receive a portion of the allocated dividends?

Some ETF’s pay dividends and others reinvest them.
The dividend isn’t from the fund itself but from the shares owned by the fund.

ETF’s make their money from fees which are deducted from the funds assets each month.

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Cheers buddy!

If you are not into dividends from ETFs an accumulation ETF is the way to go. The dividends get reinvested into the fund. Look for (acc) in the funds name.

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Thank you, that’s actually a really useful distinction.

For reasons I’ve mentioned elsewhere, I do go for funds paying dividends as I want the reinvestment decision to be mine and not made for me.

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I hold three ETFs: VWRP in my Lisa and VEVE+VFEM in my Sipp: which make up the passive core of my portfolio. I tend to use trusts for everything else: debt, property, small caps, private equity etc.