wat does dividends mean?

Answer 1

When a company makes a profit, it does not distribute all the profit to its shareholder. Out of total profit the company retain some portion and rest they pay to its shareholder. The portion paid in such a way is called dividend.

However, some company pays the dividend in between the fiscal year also. It is called interim Dividend

Dividend normally paid in in cash. Such is called Cash Dividend and normally in terms of additional share in porportion to your holdings also. It is called Stock Dividend.

So, in short cut, dividend is that portion of profit which is paid to its shareholder.

Answer 2

a dividend is a cash payment to shareholders. It's one reason why you would want to own stock in a company. The other reason would be through pure price appreciation of the stock. These two forms of compensation are the incentives for people to own stock in a company. The dividend can be thought of as the shareholders claim to the profits of the company. High growth companies will usually not issue a dividend because it chooses instead to take its profits and reinvest it in business opportunities with the hope of generating even more profits. When there are no new worthy investment opportunities, businesses can either strengthen their balance sheets (decrease debt, keep more cash on hand for emergencies...) or they can turn the profits they make over to shareholders. Just because a company issues a dividend does not mean that it does not have growth opportuinities. A good dividend can indicate a very strong company to invest in over the long runl (altria, ge...)

Answer 3

If your money is in a bank, you earn interest on allowing them to use your money. It is usually a set rate like 5%. A dividend is allowing a business to use your money, a divident can flunctate as 1 month, the business might make more money and pay a higher dividend and the next month not make as much and pay a lower dividend. (If you are trying to decide whether you want long-term money in a bank or a dividend paying account, go for the dividend account.)

Answer 4

A dividend is a payment made to a shareholder of a corporation by that corporation, and is intended to be a distribution of that corporation's profits. That's a real, real basic definition, though. Generally, cash dividends are taxable. A dividend could also be in the form of that corporation's stock, and that form of dividend is generally not taxable to the recipient.

Answer 5

dividends are profit distrubuted by company to their shareholder for eg if a co earn 1 dollar per share and declare 20% divident i.e 20cents on the face value of the share