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9
votes
5answers
2k views

Why do people buy stocks that pay no dividend?

Before recently, Apple Inc. did not give dividend to shareholders. This makes me curious why people buy Apple Inc. stocks; while it might be due to the expectation of selling stocks at a higher ...
8
votes
3answers
195 views

If stock price drops by the amount of dividend paid, what is the use of a dividend

I have heard that some people buy stocks based on how much dividend they pay, because dividend is considered 'income'. But if I buy a stock for 100$ and it pays a $1 dividend, the stock would also ...
-1
votes
1answer
41 views

How to calculate forward price for asset with dividend?

I have this exercise question: A particular forward contract costs nothing to enter into at time t and obliges the holder to buy the asset for an amount F at expiry T. The asset pays a dividend DS at ...
3
votes
1answer
78 views

Being tax efficient with dividend stocks

I've been considering selling off more of my (growth) stocks and placing the capital in dividend stocks. However, I realize Uncle Sam will tax me on any dividends I earn throughout the year. Is ...
0
votes
1answer
53 views

Is it possible that for shares to be reinvested in a stock you already sold?

I just recently set my taxable investment account from reinvest dividends to deposit in cash. However, there seems to be a delay (I assume related to one of the various dates associated with ...
2
votes
2answers
46 views

Wash sale rule with dividend reinvestment

Let's say I buy some stock. Two weeks later it pays a dividend which is reinvested in fractional shares of the stock. The next day I sell all shares at a loss. Would this be considered a wash sale? ...
3
votes
1answer
154 views

For TurboTax online's “Enter Dividend Income”, what goes in the “Broker or Payer” field?

I am confused by this field. Should I enter the company that actually issued the dividend or my broker's name?
3
votes
1answer
108 views

Why does Yahoo miss some mutual fund dividends/capital gains?

I was looking at a mutual fund data on Yahoo Finance and I found some problems. I'll bring Fidelity's FBMPX as the first example to show what I found [Link to Fidelity site]. On Fidelity's site, it ...
2
votes
1answer
76 views

Why do many British companies offer a scrip dividend option in lieu of cash?

Some stocks like GlaxoSmithKline, HSBC, Tesco, Unilever all offer dividends every quarterly/yearly, with the option of scrip dividend (opting to use the dividend to purchase shares). Why would ...
5
votes
3answers
561 views

How do I factor dividends and yield into the performance of a security?

The basic stock chart tracks the price of the stock. As discussed here the price of the stock drops by the amount of the dividend. So when a dividend pays out the stock chart makes it look like ...
6
votes
2answers
1k views

If I short-sell a dividend-paying stock, do I have to pay the dividend?

If I hold shares of a stock on the ex div date, I get a dividend. But if instead I were to short-sell the stock and not buy it back before that date, would I then be responsible for paying the ...
3
votes
5answers
1k views

Investing in dividend-yielding stocks with money borrowed from margin account?

I am getting ready to invest some of my savings in a stock brokerage account. The well-known brokerages, e.g. ETrade, Ameritrade, etc, have relatively high margin interest rates for the level I am ...
3
votes
3answers
69 views

Source of income: from dividends vs sale of principal or security

Source: P172, P214, ETF for Dummies, 2nd Ed (2011) by Russell Wild: P172: First, if you need a steady stream of income, nothing is stopping you from creating artificial dividends by selling off ...
2
votes
1answer
54 views

Why would preferred shares have less potential for capital gain compared to common stock?

From the investopedia article on preferred vs. common shares: Preferred shareholders have priority over common stockholders on earnings and assets in the event of liquidation and they have a ...
37
votes
8answers
4k views

Why does a company pay dividends at all?

If a company can lower the dividends and even stop paying them at all during hard times, why would they re-install them at all? If I understand correctly a company pays dividends so that investors ...
2
votes
3answers
158 views

How an ETF pays dividend to shareholders if a holding company issues dividend

If I hold 100 shares of SPY ETF, and one of the participating companies (A) pays out a dividend of 1$ per share. Will I get any dividend? If yes, I guess I will not get 1$ per share of SPY. It seems ...
2
votes
2answers
108 views

Does a stock really dip in price on the ex-dividend date? And why would it do this?

As per this Investopedia article: Because the stock price is expected to drop by the amount of the dividend on the ex-dividend date, Why is a stock expected to fall on the dividend date? Does ...
5
votes
3answers
214 views

Why is a stock dividend considered a dividend? What makes it different from a stock split?

I've been reading Principles of Corporate Finance by Brealey, Myers and Allen, but unfortunately they did not cover stock dividends. From what I understand, by paying a dividend, a company can ...
3
votes
3answers
199 views

Identifying “Dividend Stocks”

Can anyone point me towards some information on investing in dividend stocks, and how to identify good companies? Are there any metrics? I am fairly illiterate when it comes to finance and stocks, but ...
0
votes
2answers
121 views

Is dividend taxation priced in derivatives?

Suppose I have 200$ and I want to track Microsoft's stock (MSFT). For the sake of simplicity suppose I don't pay any commissions and there is no bid/ask spread and no counterparty risk. I have two ...
7
votes
1answer
1k views

Which US market indexes (Dow/DJIA, S&P500, NASDAQ) include reinvested dividends?

Which major US market indexes (Dow/DJIA, S&P 500, NASDAQ) include returns from reinvested dividends, and which don't? Where can "total return" information be found for each index that doesn't ...
2
votes
2answers
575 views

Does dividend on 401K have any effect on gains

While I was studing my 401K I found something strange on my Dividend Mutual Funds. I ask the provider of my 401 for information and this is what they told me. To clarify, when I invest on thier ...
0
votes
2answers
1k views

How to determine duration of a common stock whose dividends grow in perpetuity?

What is the duration of a common stock whose dividends are expected to grow at a constant rate in perpetuity? Specifically, how can I compute this, since the dividends will grow forever? Update: ...
4
votes
1answer
160 views

Are there any ETFs that follow the “Dogs of the Dow” allocation?

Essentially what it says on the tin. The "Dogs of the Dow" strategy seems to be a fairly popular basic strategy to follow for stock portfolio allocation - are there any ETFs that do this for you?
2
votes
2answers
478 views

What's the best online tool that can track my entire portfolio including gains/losses?

My broker does a great job of keeping my positions current but has really bad views/reports while other sites do a great job of tracking gains/loss and other reports but they don't keep track of ...
3
votes
2answers
102 views

Do dividend quotes for U.S. stocks include witheld taxes?

Consider, for example, the following dividend distribution table for SPY: http://finance.yahoo.com/q/hp?s=SPY&a=00&b=29&c=1993&d=08&e=19&f=2013&g=v When an entry in the ...
5
votes
2answers
139 views

Shelter personal corporation dividends in a TFSA?

As I understand it, it is possible for people who own their own corporation/small business to pay themselves through dividends. Since they own 100% share in the business they receive 100% dividends. ...
5
votes
1answer
139 views

Why do most U.S. companies pay their dividends quarterly, as opposed to annually?

U.S. companies usually pay quarterly dividends. Why do they pay them quarterly, and not once per year after the end of their fiscal year (as is usual, for example, for Swiss and German companies)?
3
votes
2answers
613 views

What is the tax treatment of scrip dividends in the UK?

What is the tax treatment of a scrip dividend in the UK? Do I declare the value of shares as income or the actual value of the dividend?
2
votes
2answers
124 views

How are dividends for shareholders of banks paid?

Banks are different from other firms, so I am not sure how shareholders (those with equity) of banks get paid their dividends. Asset minus liabilities figure do make sense in ordinary firm cases, but ...
6
votes
1answer
74 views

Collecting Dividends while insulating volatility through options?

Is it possible to use options to collect dividends on stocks while insulating yourself from the volatility? If so, how? e.g., If I bought 100 shares of a REIT but didn't want to expose myself to ...
1
vote
2answers
1k views

Concerning ETF that do dividend reinvestment for you. Is that taxable?

My understanding that when you purchase an ETF, you technically own your portion of the underlying holdings. (This is the reason commodity ETFs are taxed like commodities.) Per the below an ETF may ...
4
votes
2answers
520 views

How does the Dow Jones Industrial Average (DJIA) divisor change to account for dividends?

The DJIA is a price-weighted index tracking of 30 companies chosen by the Dow Jones Company. It takes the current share price of these 30 stocks and divides by a specific number called the divisor. ...
4
votes
1answer
206 views

Determining the minimum dividend that should be paid from my S corporation

I am the sole shareholder and only employee of an S corporation. I understand that all profits of the corporation are passed through and taxed as income to me. I also understand that all dividends ...
3
votes
1answer
366 views

Why do mutual funds and ETFs in the U.S. not capitalize dividends?

I am from Europe/Belgium and in Europe it is common to have funds and ETFs which capitalize/re-invest instead of distribute the dividends. I have been looking to the Vanguard ETFs and funds lately, ...
2
votes
2answers
600 views

How to calculate dividend yield for the Dow Jones Industrial Average (DJIA) index?

This should be fairly straightforward. How do I calculate the dividend yield myself for the Dow 30 / Dow Jones Industrial Average (DJIA)? I'm thinking I just add the last dividend for all the ...
5
votes
1answer
2k views

Why would a company issue a scrip dividend and how will this issue affect me?

Barclays in the UK have sent out a leaflet recently (online version) saying they are moving to a Scrip Dividend programme. The FAQ does its best to answer questions but still uses a lot of jargon and ...
5
votes
4answers
3k views

Difference between dividend and interest

A representative at my federal credit union used dividend and interest exchangeably in our communication, claiming the two were the same concept in their financial institution, which doesn't sell ...
3
votes
1answer
46 views

How is the dividend payment calculated when an asset is disposed on the ex date? [duplicate]

Example: XYZ Corp pays a $0.25/share dividend - Ex date=1/15/13, Pay date 1/31/2013 I own 100 total shares of XYZ on 1/1/2013 I buy 50 shares of XYZ on 1/15/2013 at 12 PM (increasing shares to 150) I ...
2
votes
2answers
825 views

What is the dividend tax rate for UK stock

I had purchased some UK stocks from London Stock Exchange. May I know, what is the dividend tax rate by UK government for UK stocks, on foreign investor (I am from Malaysia)?
3
votes
1answer
114 views

Ex-dividend date and time zones

Is the ex-dividend date linked to the time zone of the market it is bought at? Let's imagine an American firms stock traded at NASDAQ and a German market, the ex-Dividend day being the 1st February. ...
11
votes
5answers
7k views

Please explain the relationship between dividend amount, stock price, and option value?

I consider myself a reasonably knowledgeable investor, but today was blown away by the fact that I didn't know that a stock's price is decreased by the amount of its dividend. To use a concrete ...
7
votes
2answers
268 views

What ways are there to invest in stocks, options, indexes, etc, and where should one start (what funds)?

I have been poking around with investing for a few years now. I have diversified my assets a decent amount, between a home, several IRA's and 401k's, savings and checking accounts, and a little bit of ...
-1
votes
1answer
196 views

How do I calculate the dividend yield for Disney Co?

I'm trying to "estimate" the dividend yield for Disney (NYSE:DIS). Let's pretend stock price will stay at $57 and the tax rate is 1%. Is it really the case that after 3 years with this stock the ...
2
votes
3answers
222 views

Capital gains on no-dividend stocks - a theoretical question

Suppose company X has a policy of never giving out dividends and this policy will never change. Now suppose company X doubles its earnings every year. Will its stock prices go up? Sure, the company ...
6
votes
4answers
1k views

In India, what is the difference between Dividend and Growth mutual fund types?

I've always seen a mutual fund with two types (specifically pointing to Indian mutual funds) that are XYZ - Dividend/XYZ - Growth mutual fund? What exactly they mean here? Which is the best to buy?
5
votes
1answer
116 views

Question about ex-dividend date timing

For example, if the ex-dividend date is next Monday, and I buy the stock on next Monday, would I get the dividend? Or would the person who sold the stock to me get the dividend?
11
votes
3answers
2k views

Are there capital gains taxes or dividend taxes if I invest in the U.S. stock market from outside of the country?

Recently, I invested in some stock in the U.S. stock market. I was wondering: Whether there are capital gains taxes if I sell stock? Do they take account into my foreign exchange loss? Are there any ...
2
votes
1answer
132 views

Where is dividend information published?

When a company decides to pay a dividend, where does that information go first? Lots of site re-publish the dividend but where do they go to find this information quickly?
8
votes
3answers
407 views

High dividend stocks

Is it a good investment strategy to go long on "boring" companies (AT&T for example) and keep them around just because of their dividends or would it be better to trade more frequently companies ...