Mutual Funds' distribution Q:

[14tokihorn]

This is in B&W - direct from their Web presence: (the statement stands on its' own - not taken out of context, just from a basic page listing their various funds' dividends paid from last year.)

In reply to:

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[JohnnyM]

it's like a dividend. so if your $25.00 share has a $5.00 dividend built into it, the share price will be reduced to $20.00 once they pay you the $5.00.

 

[EuroHorn]

In reply to:

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[14tokihorn]

OK, so...

My fund happened to pay a dividend (part and parcel to "distrbutions") - payed June 15 `10.

I go to my favorite Market watching site. I should see a drop in the Funds' price on or shortly after June 15 `10?

But funds are quoted in NAV, or Net Asset Value, and I know what that is.

Shouldn't the quote above have been more appropriately worded to say "NAV", instead of "price", or is this just assumed, and the savvy reader should infer the meaning?

 

[EuroHorn]

For mutual funds they tend to use price and NAV interchangeably. For example, do a google for a specific fund by its fund letters and the google page will show the current NAV. If you click on the link and go to the specific page, then it will reference prices.

On the record date, you will see the NAV (or price per share) drop by the distribution amount.