Dividends

Dividends are payments made by a corporation to its shareholders, typically as a distribution of a portion of the company’s profits. These payments can take the form of cash or additional shares of stock and are usually issued on a regular basis, such as quarterly. The decision to pay dividends, as well as the amount, is determined by the company’s board of directors and reflects the firm’s profitability, cash flow, and financial policy. Dividends are often seen as a way for companies to reward their investors and can be an important factor for investors when choosing stocks, as they provide a source of income in addition to potential capital gains from the appreciation of the stock’s price.