eMaxis Slim All Country: reinvest dividends question

[cocacola]

I'm a a bit confused with the "reinvest dividends" part of the eMaxis Slim All Country on Monex...

From what I understand (and please correct me if I am mistaken), the specification of the eMaxis Slim All Country fund (eMSAC) is such that any dividend-paying company within the eMSAC fund will be automatically re-invested back into those particular companies.

However, when purchasing shares of eMSAC, there is an option to "reinvest dividends" or "pay dividends" (on Monex, at least).

This has me confused as I had thought that the eMSAC fund itself does not pay-out dividends... am I wrong here? Does the fund actually pay dividends?

If it actually does not pay dividends, then is the option of re-investing dividends (or not) just another example of Japanese website design-excellence?

[Tsumitate Wrestler]

The setting is there for all funds, for reinvesting funds like Emaxis it does not change anything.

HOWEVER, it may annoyingly cause the funds do be grouped differently. So, best leave it be and select reinvesting.

I accidentally clicked reinvested for the old Tsumitate with Rakuten, and now it considers it a separate investment, it is grouped differently, despite no material change. Very annoying

[cocacola]

The setting is there for all funds, for reinvesting funds like Emaxis it does not change anything.

HOWEVER, it may annoyingly cause the funds do be grouped differently. So, best leave it be and select reinvesting.

I accidentally clicked reinvested for the old Tsumitate with Rakuten, and now it considers it a separate investment, it is grouped differently, despite no material change. Very annoying

Thank-you very much for the confirmation, Tsumitate Wrestler. I will continue to select "reinvest dividends" to keep my investments grouped together.

[adamu]

You're right that the fund reinvests internally so does not pay out a dividend, meaning the setting is mostly irrelevant.

They don't promise to never pay out a dividend, however. So in the event that they *did*, the setting would be taken into account.

[ChapInTokyo]

Actually, according to the prospectus, eMaxis Slim All Country mutual fund apparently decides whether to pay a distribution or not every April 25th.

It just happens to be the case that every year since inception they've decided not to do so. This makes perfect sense since the eMaxis Slim All Country fund aims to track the performance (with dividends reinvested) of the MSCI Kokusai, EM and Japan indexes.

I suppose the wording is there just in case they have to start paying distributions due to some changes in the future in the legal framework around mutual funds so that they must pay out dividends like ETFs and REITS.

Anyway that's why it probably makes sense to click on the 'reinvest dividends' button at your broker...

■分配方針
● 年１回の決算時（４月25日（休業日の場合は翌営業日））に分配金額を決定します。
● 分配金額は委託会社が基準価額水準、市況動向等を勘案して決定します。ただし、分配
対象収益が少額の場合には、分配を行わないことがあります。
分配金額の決定にあたっては、信託財産の成長を優先し、原則として分配を抑制する方針とし
ます。（基準価額水準や市況動向等により変更する場合があります。）
将来の分配金の支払いおよびその金額について保証するものではありません。
https://www.am.mufg.jp/pdf/koumokuromi/ ... 240119.pdf
Distribution Policy
The distribution amount will be determined once a year at the time of settlement of accounts (April 25 (or the following business day if the date is a holiday)).
The amount of distribution will be determined by the fund management company, taking into consideration the level of NAV, market trends, and other factors. However, if the amount of income subject to distribution is small, the amount of distribution will be determined by the asset management company.
However, if the amount of income subject to distribution is small, distribution may not be made.
In determining the amount of distribution, the Investment Corporation will give priority to the growth of trust assets and, as a general rule, will limit the amount of distribution.
(The amount of distribution will be determined based on the level of NAV, market trends, and other factors. (The amount is subject to change depending on the level of NAV, market trends, etc.)
The Fund does not guarantee future distribution payments or the amount of such payments.

Translated with DeepL.com (free version)

[ChapInTokyo]

The bit about distributions in the prospectus might be there just so the fund doesn't run foul of the law.

投資信託及び投資法人に関する法律(Act on Investment Trusts and Investment Corporations)
https://elaws.e-gov.go.jp/document?lawi ... 0000000068

（目的）
第一条　この法律は、投資信託又は投資法人を用いて投資者以外の者が投資者の資金を主として有価証券等に対する投資として集合して運用し、その成果を投資者に分配する制度を確立し、これらを用いた資金の運用が適正に行われることを確保するとともに、この制度に基づいて発行される各種の証券の購入者等の保護を図ることにより、投資者による有価証券等に対する投資を容易にし、もつて国民経済の健全な発展に資することを目的とする。

(Purpose)
Article 1 This Act establishes a system for persons other than investors to collect and manage investor funds mainly as investments in securities, etc., using investment trusts or investment corporations, and to distribute the results to investors and to ensure that funds using these funds are managed appropriately, and to protect purchasers of various securities issued under this system. The purpose of this policy is to facilitate investors to invest in securities and thereby contribute to the sound development of the national economy.