Saturday, December 25, 2010

Accumulation Units

Accumulation units are a specific type of fund unit which automatically reinvest an interest earned or dividends paid. This is essentially an automatic reinvestment plan, however the units are contractually structured to remove the option of receiving income distributions. As a consequence the value of these units increases over time, and holders may benefit from compounding returns.

Synonyms: Reinvestment, SIP, Automatic reinvestment, Dividend reinvestment plan
 
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