There are four basic dates associated with the dividend declaration and payment 1. Dividend Declaration date: This is the date on which the board of directors announces to shareholders the quantum of dividend that will be paid by the company.
2. Ex-dividend date - On (or after) this date the security trades without its dividend. If an investor buys a dividend paying stock one day before the ex-dividend he/she will still get the dividend but if the stock is bought on the ex-dividend date, the investor will not get the dividend.
3. Record date - This is the date on which the company looks at its records to see who the shareholders of the company are. An investor must be listed as a shareholder to ensure the right of a dividend payout.
4. Dividend payable date - This is the date when the company mails the cheques for the dividend amount due to the shareholders who appear on the register of shareholders.
High dividend yield stocks offer a safe investment option to investors where safety has greater priority compared to high returns. If the market remains directionless and stock price goes no where then also an investor can get decent returns by investing in higher dividend yield stocks. The dividends are paid no matter what direction the stocks move and can provide a higher yield on investment in a weak market. What is Dividend A distribution of a portion of a company's earnings, decided by the board of directors, to its shareholders is called as Dividend
Basically dividend are distributed by stable and profitable company. What is Dividend Yield? Dividend yield is nothing but dividend percentage and it is calculated by taking the amount of dividends paid per share over the period of a year and divided by current stock's price.
For example, if a stock pays out Rs 4 in dividends over the period of a year and currently the stock price is at Rs 80, then it has a dividend yield of 20%.
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