Collecting Mutual Fund Dividends Post Rebalance

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Hey guys, in the midst of the election season and all the financial uncertainty, I decided to rebalance my Fidelity 401k portfolio and convert all my stock heavy mutual funds into Money Market to weather out this election season. After doing so, I realized that I typically get dividend distributions for these mutual funds atoujd December of each year. Since I've executed the rebalance a few days ago, will Fidelity still distribute the dividend gains I was entitled to for these funds that I maintained for a significant part of the year? Or have I now missed out on and dividend distributions in December?

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You lost the distributions. And to be honest, this should serve as a learning experience, it was not very smart to move from equities to money market over something like an election. The volatility during an election is no more or less than any other time.

Buy and hold.

UncaMikey said:   You lost the distributions. And to be honest, this should serve as a learning experience, it was not very smart to move from equities to money market over something like an election. The volatility during an election is no more or less than any other time.

Buy and hold.


Most stocks pay out dividends each quarter or semi-annually, does that not mean that Fidelity who administers these mutual funds would pay out the annual distribution or dividends relative to the quarters for which I held the mutual fund?

Also, I did not just sell due to the elections. I consider this the perfect storm, based on the candidates currently tied to the election, the Brexit underway, over-valuation of stocks, and high chances of Fed's raising interest rates before Christmas.

You will not get the distributions that are done in December, sorry. Look up "ex-dividend date" and "record date."

Don't get defensive, you may get much harsher comments on FWF, but trying to time the market because you foresee downturns and upturns never works out. You are trying to beat the market -- you may get little successes here and there but you will lose out in the long term.

UncaMikey said:   You will not get the distributions that are done in December, sorry. Look up "ex-dividend date" and "record date."

Don't get defensive, you may get much harsher comments on FWF, but trying to time the market because you foresee downturns and upturns never works out. You are trying to beat the market -- you may get little successes here and there but you will lose out in the long term.


I am aware of the fact that each stock within the mutual funds I had invested in would have its own respective "ex-dividend date" and "record date". My ask is, for a given stock, IF the "record date" happens to be prior to my rebalance date of last Wednesday, would Fidelity still be obligated to make the dividend distribution to my account come December?

Dividends are priced into the fund. Most funds will drop in value by exactly the distribution -- so you didn't lose anything.

romnet said:   I am aware of the fact that each stock within the mutual funds I had invested in would have its own respective "ex-dividend date" and "record date". My ask is, for a given stock, IF the "record date" happens to be prior to my rebalance date of last Wednesday, would Fidelity still be obligated to make the dividend distribution to my account come December?
  Your fund will receive the dividends for the stocks it holds on the respective dates based on their holding on the corresponding record date. Based on that, obviously the NAV of the fund will adjust. So, in effect, you have already "received" those dividends (not directly as a cash payout but as part of the NAV that was used when you sold the funds).

The fund will distribute dividends on a particular date based on your holding of the fund's shares on a corresponding record date. Presumably these dates for your Fidelity fund are in December. No, you will not receive any distribution from the funds in December since you will presumably not be holding shares of the fund on the record date.

stanolshefski said:   Dividends are priced into the fund. Most funds will drop in value by exactly the distribution -- so you didn't lose anything.
  Exactly.


Fidelity 401k
Disclaimer
The benefit of the dividends received are priced into the daily mutual price. You did not loose anything. When you sold or moved out of a given mutual fund, you gave up any claim to anything the mutual fund gains, looses or distributes after the date of transfer. However any dividends the mutual fund received are now priced into your capital gain which is of no real concern on a 401k.

That said, I hope you are still contributing enough to get any employer company match.

romnet said:   I decided to rebalance my Fidelity 401k portfolio and convert all my stock heavy mutual funds into Money Market to weather out this election season.
  What you did (or are trying to do) is market timing. It is hard to characterize it as a (portfolio) rebalance.



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