What is the difference from an accumulating fund?

A distributing fund pays out a portion in cash, while an accumulating fund reinvests everything automatically. The portfolio and management are identical. The difference lies only in how payouts are handled.

Which Amos Value share class is distributing?

Amos Value E (Dist) is the distributing share class. Amos Value A (Acc) is the accumulating one. Both own the same portfolio and are managed identically.

Do I get a lower return with a distributing fund?

Not from the payout itself. The difference lies in what you do with the dividend. Spend it and the total return is lower than in an accumulating fund. Reinvest it and you get essentially the same effect, though rarely exactly the same: in an accumulating fund the reinvestment happens automatically, whereas with a distributing fund you have to put the money back in yourself. In the meantime it sits out of the market, and depending on when you reinvest, the result can be slightly lower. Within an ISK, however, the choice does not affect the tax.

How is the dividend taxed in an ISK?

Dividends received within an ISK are included in the flat-rate tax and are not taxed separately. You pay no withholding tax or capital gains tax on individual payouts.

Glossary

Distributing fund

A fund that pays out a portion in cash to unitholders instead of reinvesting everything. Suits investors who want an ongoing cash flow from their savings.

What it is

Returns that are paid out

A distributing fund pays out a portion in cash to unitholders, usually once a year. The money lands in your account instead of being reinvested in the fund. The investment strategy is exactly the same as in an accumulating fund. The only difference is how payouts are handled. Investors who live off their capital, or simply want to see a concrete cash flow, often choose the distributing share class for that reason.

Amos Value E (Dist): Amos Value E (Dist) is our distributing share class. The same portfolio, the same management, and the same margin of safety as Amos Value A (Acc), but with a cash dividend.
Ongoing cash flow: The dividend provides a regular top-up without you having to sell units. Practical for anyone who wants to supplement their income.
You decide what the money does: A paid-out dividend can be spent, saved, or reinvested manually. If it is reinvested manually, the compounding effect is essentially the same as in an accumulating fund, where it happens automatically.

In practice

How the distributing share class works

The choice between distributing and accumulating is rarely about returns and more often about what the money is for. In the accumulating share class everything is reinvested automatically. In the distributing share class a portion is paid out in cash, for example as a complement to a pension. Within an investment savings account (ISK) the choice does not affect the tax, since an ISK is taxed at a flat rate whether the dividend is paid out or reinvested.

“The same companies, the same earnings. Just a different way to take part in them.”

Amos Fonder

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Common questions about distributing funds

Two share classes, one fund

Accumulating

Amos Value A (Acc)

Dividends are reinvested automatically. Compounding takes care of itself, with nothing for you to do.

Distributing

Amos Value E (Dist)

A portion is paid out in cash. Suits investors who want an ongoing cash flow from their savings.

Related concepts

Glossary

Accumulating fund

A fund that automatically reinvests dividends instead of paying them out. Compounding takes care of itself, with nothing for you to do.

Glossary

FIRE (Financial Independence, Retire Early)

A savings goal centred on building a capital base large enough for its returns to cover living costs, providing financial independence and the option to stop working early.

Glossary

Margin of safety

The difference between a company's intrinsic value and its market price. The foundation of thinking about risk and asymmetric return.

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