What is the difference between distributing and accumulating ETFs?

A distributing ETF pays out dividends or interest to shareholders as cash distributions (unless you set up reinvestment with your broker). An accumulating ETF reinvests that income back into the fund, so the value is reflected in the ETF price instead of cash payouts.

Accumulating share classes are common outside the U.S., especially in Europe. Investors often choose them for simplicity and potential tax/reporting preferences depending on local rules.

When choosing between distributing and accumulating, think about your goal: cash flow vs reinvestment. Also consider how your country taxes distributions versus capital gains, because the best choice can depend heavily on the tax regime.