2007-03-28 09:45:53 · 3 answers · asked by sherrill59@sbcglobal.net 2 in Business & Finance ➔ Investing
No. Dividends are paid by the company in whom you have invested. It is paid based on the net income the company made in that quarter divided by the number of shares outstanding.
2007-03-28 09:54:04 · answer #1 · answered by AuntLala 3 · 1⤊ 0⤋
No. Not at all, really.
Dividends are cash payments to shareholders, as some form of percentage of the profits, based on the amount of shares you actually own. There is no ongoing requirement for these payments to be made.
Interest you are paid is based on a debt you own. Debt is very different from equity (shares of stock).
Owning a company's debt does not give you an ownership in the company itself.
They are treated differently for tax purposes as well.
Two distinct animals.
2007-03-28 10:02:38 · answer #2 · answered by Yanswersmonitorsarenazis 5 · 1⤊ 0⤋
Dividends are analogous to interest payments, in that this is how a company directly compensates you for investing in the stock.
That said there are significant differences-- not all companies pay dividends (corporations can reinvest earnings in their operations or buy back stock rather than paying out cash to owners directly) and dividends can change over time (a company can cut its dividend, for example.)
2007-03-28 10:10:02 · answer #3 · answered by Adam J 6 · 1⤊ 0⤋