Dividend Yield Funds vs Dividend Option in Mutual Funds: What’s the difference?

Dividend Yield Funds vs Dividend Option in Mutual Funds: What’s the difference?

Have you noticed that when you invest in mutual funds, there are generally two options? One is the growth option and the other is the dividend option now called IDCW, which stands for Income Distribution cum Capital Withdrawal. Dividend Yield Funds are a type of equity mutual funds that invest in stocks of companies that pay regular dividends. These funds focus on stocks that provide higher dividend yields compared to the average market level.

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