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Let's say you have 1000 shares of YourFund, and the current NAV is $15, so your current value is $15,000. On the day YourFund distributes its dividends/gains/etc, that equal say, $3.00 per share, the NAV will go from $15 to $12.

Assuming you take your distributions in cash, you now have 1,000 shares valued at $12 per share for $12,000, plus a distribution of $3 per share x 1,000 shares for $3,000.

So you still have $15,000.

If you know you need the whole $15,000, and there's an tax advantage to selling this year vs. next, I'd suggest selling at the current price. December and January are a volatile time of year in mutual funds and the market in general*, with people and institutions selling to lock in gains or tax-deductible losses in both funds and the stocks they hold.

*I'm not trying to start a January effect debate here, just noting an observation that flakey stuff happens this time of year, and it aint necessarily logical.

FunDad
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