Dividends & Interest

Your investments can generate returns in the form of asset growth, dividends and interest. Dividends are payments from a company's profits, while interest comes from the growth of your invested funds.

Dividends are a portion of a company's profits paid to its shareholders. They let you earn regular income from your investments, in addition to any growth in the value of your investment. Dividends can be paid in cash or as additional shares, giving a return without selling your investment.

Dividends are typically paid on a regular schedule: quarterly, semi-annually, or annually. Payments can be credited directly to your account or reinvested to buy more shares, depending on the company's policy and your preferences.

In South Africa, dividends are subject to Dividend Withholding Tax (DWT), which is usually deducted before payment.

When you receive dividends through Franc, these dividends are reinvested into shares where possible. If a dividend amount is too small to purchase additional units, it's allocated to your Excess Cash account until it can be used to buy more units in future.

Simply put, interest is the income you receive for 'lending' your money. The fund uses your investment to lend to governments and large institutions, and in return, they pay you interest.

Unlike other investments, your return doesn't depend on the fund's price going up or down; it comes from the borrowers paying to use your money. Money market funds earn interest, and as such offer stable, low-risk returns, making them ideal for short-term goals.

Interest is accrued daily but paid out monthly. For the Savings Account and cash fund, interest is paid during the first week of each month.