Muni Dividend Calcuation

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Muni Dividend Calcuation

Post by boogiehead » Thu May 30, 2019 11:54 am

Can someone explain to me how muni dividends are calculated. My dividends are paid out to me at the end of every month, but let's say I make a large transaction (i.e. double my shares) a couple days before the dividends are paid out.... I'm assuming it would prorate the dividends, are the dividends calculated daily based on the number of shares you have at the end of that day and then gets paid out at the end of the month?

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Re: Muni Dividend Calcuation

Post by lstone19 » Thu May 30, 2019 2:46 pm

Most bond funds (not just muni funds) declare dividends daily but pay them monthly. A very few let it accumulate in NAV and the pay it monthly with the corresponding drop in NAV when the fund goes ex-div.

If you close a bond fund position, you generally don't receive the accrued dividends for the month until the end of the month although I have seen some (particularly MM funds) pay them immediately.

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