In the UK there are "accumulating ETFs" which don't distribute the dividends. US regulations don't allow mutual funds and ETFs to do this.
Keep in mind that as with BOXX, this seems to be a tax-avoidance maneuver. It results in not paying taxes you would normally would have paid. And there's no investment reason to do what it's doing except to avoid taxes. Maybe it's 100% OK with the IRS and is a brilliant bit of financial innovation, or maybe it is not quite and there might be some kind of nuisance or glitch in the future.
According to the prospectus, one of the stated risks is:
Keep in mind that as with BOXX, this seems to be a tax-avoidance maneuver. It results in not paying taxes you would normally would have paid. And there's no investment reason to do what it's doing except to avoid taxes. Maybe it's 100% OK with the IRS and is a brilliant bit of financial innovation, or maybe it is not quite and there might be some kind of nuisance or glitch in the future.
According to the prospectus, one of the stated risks is:
INVESTMENT STRATEGY RISK. There is no guarantee that the Fund will be able to successfully avoid paying dividends and distributions. Additionally, there can be no guarantee that the Fund will be successful in its strategy to provide shareholders with a total return that matches that of the S&P 500 Index. In order to effectuate the Fund’s strategy, the Adviser is relying upon the ability to conduct in kind redemptions of the Fund’s S&P 500 ETF holdings. In the event that the Adviser is unable to do so due to factors such as broker-dealer balance sheet availability constraints, market volatility, regulatory changes, contrary IRS positions relating to an ETF’s use of in-kind creations or redemptions, or operational issues, the ability of the Adviser to avoid the taxable income generated by an investment in Fund Shares may be impaired and may force the Fund to make a dividend or distribution payment.
Statistics: Posted by nisiprius — Wed Feb 18, 2026 4:20 pm — Replies 28 — Views 7676