Frequently Asked Questions – UK OEICs
Income Payments
What is the difference between income (inc) shares and accumulation (acc) shares?
In the case of income shares the income received from the underlying investments is removed from the fund on the ex-dividend date. It is then paid to the investors on the payment date. Depending on the fund income is generally paid to the investors monthly, quarterly or bi-annually.
In the case of accumulation shares, the income received from the underlying investments is not paid to the investors. It remains in the funds but is transferred to capital, causing the value of the shares to increase.
How is the level of income (yield) on each fund calculated?
We calculate the running yield by taking into account income from all the investments within the fund's portfolio and deducting certain charges. Yields change on a daily basis due to the Fund Manager buying and selling different stocks.
The running yield is the amount of income we expect for the next 12 months. As it is estimated, it may differ from the amount you actually receive and is not guaranteed.
Will each payment be the same amount?
As the underlying investments of the fund pay dividends at varying times of the year each income payment you receive may be different. The running yield estimates the total income for the next 12 months. In order to determine the actual yield you have received you should consider a full 12 months of income payments.