Definition

A payment made by a company to its shareholders in cash, typically drawn from profits.

What to consider

  • Review the company’s dividend history for consistency.
  • Consider reinvesting dividends to enhance growth.
  • Be aware of any tax implications from cash dividends.

Real world scenarios

  • When the company announced a cash dividend, Emma was delighted to receive a portion of its profits directly deposited into her account.

Related terms

Investments & Retirement