What is a dividend?

Dividend is the money paid directly to the investor in the shares of the company. Some companies publicly owned one with their shares, while others don't. The choice of purchasing and ownership of shares that pays dividend is on an individual investor because there are both positive and negative aspects to be considered. The company that offers one with its shares is often larger and more stable in small growth or slow and stable growth potential.

When the company offers dividend to its holders of shares, it takes money that could be re -invested in the company and distribute them to shareholders as an advantage for investing in the company. Acceptance of one is good for investors because they receive a guaranteed return on their investment in the form of money. Shares that return dividend is good as an investment in income or long -term investment in growth. This is because these shares tend to remain stable and offer investors tangible cash exitDu.

Some investors avoid actions that for this reason offer dividend. The company that provides one investors does not use this money to expand their business. The stock may therefore be less likely to grow value or grow more slowly compared to a company that does not offer it, but instead uses its profits to expand or find new business opportunities. Investors looking for a shorter investment term or rapid growth tend to look for stocks that do not offer dividend.

The dividend offered by the company to its shareholders is usually paid every quarter. The amount is set for a certain value of the dollar for each share of shares. If you own 100 shares of shares that pay $ 1 (USD) per share each year, you will receive $ 25 every three months. These quarterly payments are an annual amount of $ 100. Most companies that pay the dividendprogram Stanment.

with the dividend reinvestment program instead of being mo moHL to take as a payment, the investor may decide to reinvest every dividend and take the value in stock instead of cash. In this case, the value of the investor's shares in the first quarter would increase by $ 25. Since the value of the shares is now higher than before, the dividend in the next quarter would actually be higher than $ 25, based on the number of additional shares that the first amount could buy. By reinvesting, the investor can easily increase his shares.

with any investment, research, planning, eye on the market and a little luck goes a long way. Depending on your investment needs, there may be a stock that offers a dividend, a long -term investment.