Dividend question

[Bflotomny]

I'm some what of a novice regarding mutual fund investing and have a question regarding dividends.

If I invest in a mutual fund that pays quarterly dividends and I hold the fund through the quarter up to a few days before the end of the quarter and sell the fund do I get the dividend payment or some portion of the quarterly dividend?

Example: I purchase Wellesley on 1/2/2016 and sell it on 3/29/2016 do I get any of the dividend that's paid. Also if I exchange to Equity Income on 3/29/2016 will I receive any dividend from Equity Income for the days I own it?

[meierlde]

Quote:

Originally Posted by Bflotomny I'm some what of a novice regarding mutual fund investing and have a question regarding dividends. If I invest in a mutual fund that pays quarterly dividends and I hold the fund through the quarter up to a few days before the end of the quarter and sell the fund do I get the dividend payment or some portion of the quarterly dividend? Example: I purchase Wellesley on 1/2/2016 and sell it on 3/29/2016 do I get any of the dividend that's paid. Also if I exchange to Equity Income on 3/29/2016 will I receive any dividend from Equity Income for the days I own it?

There is typically a record date and a payable date (later) for dividends. If you look at the release announcing the dividend you will see a record date when the books are closed on the dividend and the value of the mutual fund is reduced by the amount of the dividend a reinvest date when dividends from holders that reinvest the dividends in the mutual fund see the dividend, and a payable date when the dividend is paid out in checks.
The record date is when a holder gets the dividend. So if you hold the mutual fund thru the record date you get the full dividend. This is also how things work for stocks, except there is typically no reinvest date involved and the interval between record and payable may be up to a month in the case of corporate stock.