Do you earn dividends from ETF's?

Question

do they work the same way as a stock? i know that you can buy them at any point during the day when the market is open. do you earn any dividends? are there any fees like with a mutual fund?

Answer 1

An ETF is an exchange traded mutual fund. In other words, it's value is determined by the market just like a stock. So it goes up and down throughout the day.

And yes, many EFTs hold dividend stocks and pass it along to investors. Now it's possible to have an EFT that holds non-dividend stocks, but that would be very rare.

Lastly, just other mutual funds, there are fees associated with EFTs for the management of the fund. And that's because there's usually a portfolio manager who determines what stocks to have within that fund.

Answer 2

Yes, they do pay dividends.  You can go to this site to see what the dividends have been in the past for the various ETFs and when they are paid

http://www.etfconnect.com/

Answer 3

Yes. If the underlying instrument pays dividends then so will the ETF or at least the dividends will be accounted for in the price. You would have to look at the terms of the individual ETF.

They  are just like any other share (exchange traded) so can be traded any time the market is open.

There are fees, called Total Expense Ratio (TER), these are included in the quoted price. The fee is usually quite low compared to other Funds. \see http://www.shareworld.co.uk

There are lots of ETFs that do not pay dividends. One that springs to mind is Lyxor Gold Bullion that tracks physical gold.