S&P 500 Dividend Aristocrat Index: Top Companies and Definition

S&P 500 Dividend Aristocrat Index: Top Companies The S&P 500 Dividend Aristocrat Index is a list of companies that have consistently increased their dividends for at least 25 consecutive years. These companies are considered to be some of the most reliable and stable dividend payers in the market. Here are …

Residual Dividend: Definition, Purposes, Example

Residual Dividend: Definition, Purposes, Example Definition: Residual dividend is a financial concept that refers to the amount of dividend that is paid to shareholders after all necessary capital expenditures and retained earnings have been taken care of. It is the portion of the company’s earnings that is distributed to shareholders …

Preferred Dividends Definition in Stocks and Use in Investing

What are Preferred Dividends? Preferred dividends are a form of payment that certain shareholders receive from a company’s profits before common shareholders. Unlike common dividends, which are paid to all shareholders on a per-share basis, preferred dividends are paid to a specific class of shareholders who hold preferred stock. Preferred …

Participating Preferred Stock How it Works Examples

What is Participating Preferred Stock? Participating preferred stock is a type of stock that gives its holders certain rights and privileges over common stockholders. It is called “participating” because it allows the holders to participate in the company’s profits and assets in a different way compared to common stockholders. Participating …

Non-Taxable Distribution: Definition and Examples

Non-Taxable Distribution: Definition and Examples A non-taxable distribution refers to a distribution of funds or assets by a company to its shareholders that is not subject to taxation. This means that the recipients of the distribution do not have to pay taxes on the amount received. There are several types …

How to File Form 1099-DIV for Dividends and Distributions

How to File Form 1099-DIV for Dividends and Distributions Filing Form 1099-DIV is an important step in reporting dividends and distributions for tax purposes. This form is used by businesses and individuals who receive dividends, capital gain distributions, or other distributions from investments. Once you have collected all the required …

Gross Dividends: Their Meaning, Mechanics, And Real-Life Example

What are Gross Dividends? Gross dividends refer to the total amount of money that a company pays out to its shareholders in the form of dividends before any deductions or taxes are taken into account. It represents the entire distribution of profits to shareholders. Gross dividends are calculated by multiplying …

Franked Dividend: Definition, Types, Example

Franked Dividend: Definition, Types, Example A franked dividend is a type of dividend that is paid out by a company to its shareholders. Unlike regular dividends, which are paid out of the company’s after-tax profits, franked dividends are paid out of the company’s pre-tax profits. This means that the company …

Forward Dividend Yield Definition Formula vs Trailing Yield

Forward Dividend Yield Definition Formula Forward Dividend Yield is a financial ratio that indicates the annual dividend payment as a percentage of the stock’s current market price. It is calculated by dividing the expected annual dividend per share by the current market price per share and multiplying the result by …

Exempt-Interest Dividend Examples and FAQ

Exempt-Interest Dividend Examples and FAQ An exempt-interest dividend is a type of dividend that is not subject to federal income tax. This means that investors who receive exempt-interest dividends do not have to include them in their taxable income when filing their tax returns. These dividends are typically paid by …

Ex Dividend Date Definition Key Dates and Example

What is an Ex Dividend Date? An ex-dividend date is a crucial date for investors in dividend stocks. It is the date on which a stock begins trading without the right to receive the next dividend payment. In other words, if an investor buys a stock on or after the …

Dividend Reinvestment Plans (DRIPs) for Compound Earnings

What are Dividend Reinvestment Plans (DRIPs)? Dividend Reinvestment Plans (DRIPs) are investment programs offered by companies that allow shareholders to automatically reinvest their cash dividends into additional shares of the company’s stock. Instead of receiving the dividends in cash, investors can choose to have them reinvested in the same company, …

Dividend Per Share (DPS) – Definition and Formula

Calculating Dividend Per Share (DPS) Calculating the Dividend Per Share (DPS) is a straightforward process that allows investors to determine the amount of dividend income they can expect to receive for each share of stock they own. The DPS is an important metric for investors as it helps them assess …

Dividend Growth Rate – Definition, Calculation, and Example

Dividend Growth Rate: Definition and Importance Definition: The dividend growth rate is a financial metric that measures the annual rate of increase in dividends paid out by a company to its shareholders. It is an important indicator of a company’s financial health and its ability to generate consistent and growing …

Dividend Aristocrat: Definition, Criteria, Example, Pros and Cons

Dividend Aristocrat: Definition, Criteria, Example, Pros and Cons A Dividend Aristocrat is a term used to describe a company that has consistently increased its dividend payments to shareholders for a certain number of consecutive years. These companies are typically well-established and have a history of stable earnings and cash flow. …

Cum Dividend: Definition, Meaning, How It Works, and Example

Cum Dividend: Definition, Meaning, How It Works, and Example Definition: Cum dividend is a Latin term that translates to “with dividend.” It is used to indicate that a stock is trading with the right to receive the next dividend payment. In other words, if you purchase a cum dividend stock …

Convertible Preferred Stock Definition Common Terms and Example

Convertible Preferred Stock: Definition, Common Terms, and Example Common terms associated with convertible preferred stock include conversion ratio, conversion price, and conversion premium. The conversion ratio determines the number of common shares that can be obtained by converting each share of convertible preferred stock. The conversion price is the price …

Continuous Compounding Definition and Formula

What is Continuous Compounding? Continuous compounding is a concept in finance that refers to the process of calculating interest or returns on an investment continuously, rather than at discrete intervals. It is a mathematical model that assumes that interest is compounded infinitely often over a given period of time. In …

Cash Dividend Definition Example Vs Stock Dividend

Cash Dividend Definition Example A cash dividend is a payment made by a company to its shareholders, usually in the form of cash. It is a distribution of a portion of the company’s profits to the shareholders as a reward for their investment in the company. Example of Cash Dividend …

Bird In Hand: Definition and Example of Investing Strategy

Bird In Hand: Definition and Example of Investing Strategy The bird in hand strategy is an investment approach that focuses on receiving immediate benefits rather than waiting for potential future gains. This strategy is based on the proverb “A bird in the hand is worth two in the bush,” which …

Beginner’s Guide to Bitcoin: Mining, Buying, and Using

What is Bitcoin? How does Bitcoin work? Bitcoin transactions are conducted using cryptographic keys, which are unique strings of numbers and letters that are used to sign transactions. These keys are stored in a digital wallet, which can be a software program or a physical device. When a user wants …

What are Dividend Stocks? Dividend stocks are a type of stock that pays regular dividends to its shareholders. Dividends are a portion of a company’s profits that are distributed to shareholders as a way to reward them for their investment in the company. These dividends are typically paid out on …