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Yield & Redemption

How a tokenized fund pays you, and how you get out

Funds · Lesson 10.3

The yield on a tokenized fund comes from the assets the fund holds, not from the token. Redemption is the other half: returning your shares to the fund for cash. Selling to another buyer can happen whenever a buyer is available. Redemption happens on the fund's schedule.

WHERE THE YIELD COMES FROM

Treasury bills and loans pay interest, and property earns rent. The token is a claim on that income, not its source.

HOW THE YIELD REACHES YOU

Some funds pay income as additional tokens and keep the price steady. Others keep the income in the fund, so each token's price rises. The income is the same; the mechanics differ.

HOW YOU GET YOUR CASH BACK

You submit a redemption request. The fund uses cash or sells assets, cancels your tokens and pays you. Some funds do this daily, others monthly or quarterly.

Wally’s note: sell: now. redeem: when the fund says so.

Selling a token can be quick. Redeeming it for cash follows the fund's schedule.

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