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Dividends are payments made by a corporation to its shareholder members. When a corporation earns a profit or surplus, that money can be put to two uses it can either be re-invested in the business (called retained earnings), or it can be paid to the shareholders as a dividend. Many corporations retain a portion of their earnings and pay the remainder as a dividend.

For a joint stock company, a dividend is allocated as a fixed amount per share. Therefore, a shareholder receives a dividend in proportion to their shareholding. For the joint stock company, paying dividends is not an expense; rather, it is the division of an asset among shareholders. Public companies usually pay dividends on a fixed schedule, but may declare a dividend at any time, sometimes called a special dividend to distinguish it from a regular one.

Dividends are usually settled on a cash basis, as a payment from the company to the shareholder. They can take other forms, such as store credits (common among retail consumers' cooperatives) and shares in the company (either newly-created shares or existing shares bought in the market.) Further, many public companies offer dividend reinvestment plans, which automatically use the cash dividend to purchase additional shares for the shareholder.

Cash dividends (most common) are those paid out in the form of a cheque. Such dividends are a form of investment income and are usually taxable to the recipient in the year they are paid. This is the most common method of sharing corporate profits with the shareholders of the company.

Dividend Subcategories Dividend Articles Are Investments With Dividends Better Than Non Dividend Paying Investments by Mika Hamilton Jan 29, 2008 support@global-investment-institute.com. Best regards Mika Hamilton http://www.stockmarketaustralia.com.au Are Investments With Dividends Better Than Non Dividend Paying Investments When you have some kind of investment that pays d... Value Stock Crash Reaches 50 Per Cent by Steve Selengut Dec 18, 2007 Perhaps this (totally ignored by the media) snippet will pique your attention: on December 18, 2007, nearly 50% of all Investment Grade Value Stocks were down an average of over 30% from their 52-week highs... the Dow and the S & P 500 had fallen jus... Objective of dividend real estate investing by Narayanan vk Sep 05, 2007 Dividend Real estate investing is a grand way to uphold your portfolio with the skill to run the company when directly buying shares from the company. The chief objective for dividend investing is as follows: Objectives of triumphant dividend... Yesterday's dog, tomorrow's darling by Melanie C Jul 11, 2007 The market's expectations about a stock swing around much more wildly than its underlying value. In the first instalment of this value investing series back in issue 197/Apr 06, we noted that 'for some, [value investing is] all about buying s... The ins and outs of PERs by Melanie C Jun 25, 2007 It's time to discuss an often over-used and much misunderstood yardstick. There are two types of people who read The Intelligent Investor; those who know what the letters 'PER' stand for and those who skip over them and hope they're not too i... Dividend Dates by Melanie C May 30, 2007 Dividend dates create a fair bit of confusion. Hopefully, the following will help. Firstly, from the company's perspective, there are two important dates – the 'record date' which, as we'll explain, isn't important for investors and the 'paya... Ducking dodgy dividends by Melanie C May 29, 2007 The juicy-looking yields you see in the newspaper aren't always what they seem. Last issue we discussed some important questions to ask yourself before buying a stock on the basis of its dividend yield. This time we're going to focus on apply... Dividend basics explained by Melanie C May 09, 2007 Don't know your ex-date from your record date? Read on. Ex-date, record date, books closing date, payable date - there are enough dates associated with a dividend to fill up a calendar. So this issue, for those new to the world of investing, ... Citi Credit Cards: A Look At The Top 4 by Edward Vegliante Apr 10, 2006 Copyright 2006 Edward Vegliante With all of the credit card offers available to the public, consumers often have a difficult time choosing the one that?s right for them. Citibank, one of the leading credit card companies in the United States, h... Currency Trading or Dogs-of-the-Dow. by Mike Pauli Mar 06, 2006 Have you ever heard of the Dogs-of-the-Dow system. It’s a well known system in the stock and trading business. There are several stock brokers who have earned a lot of money by working with this system. They have been using it for sev...