New answers tagged dividends
2
0QYI is a CREST Depotitory Interest (CDI). CDIs are conceptually similar to ADRs in the US.
Do their prices change in the same way, or it is not necessary (and just true in general)?
Due to the exploitation of arbitrage opportunities by other market participants, you can expect the value of a CDI to accurately track the value of the underlying.
If ...
1
I don't know of the American tax system, but I could imagine that on stock dividends, income tax would be due as well (not necessarily immediately, but at a later time).
The argument
The shareholder always has to do work during dividend season to reinvest the dividends.
can be weighed against
Whenever the investor needs cash, he/she can create a cash ...
1
According to https://revenusetdividendes.com/liste-actions-toucher-dividendes-bourse/, no french stock gives a monthly dividend:
Malheureusement, il n’existe pas d’actions à dividendes mensuels en France.
Google Translate:
Unfortunately, there are no monthly dividend shares in France.
0
Taking the question more broadly: If you have taxable investments and want to make donations, consider directly donating securities (rather than income or proceeds from them) if you have unrealized capital gains. This allows you to deduct the current market value of the donation (if you itemize) and avoid paying capital gains tax.
2
These are really two different things. You can't "combine" them.
You have income from stock cash dividends or bond interests. You need to pay income tax on these and then the money is "free & clear" yours and you can do with it whatever you want.
You can donate any of your money to charity. It makes no difference where it comes from. The donation is ...
0
Are there specific dates for companies to declare ordinary dividends?
There is no requirement that they have to be always X days after the end of their quarter, or on the third Wednesday after the end of the quarter. Though if the company is paying a dividend every quarter they might specify the dates of the next dividend votes far in advance, thus giving ...
0
Like an earnings announcement date, the declaration of a dividend is tied to the company's financials. It happens when the company has completed the task and it isn't necessarily finished by the same date each quarter (or other time period).
There are numerous web sites that provide ex-dividend dates along with record date, pay date and dividend amount. ...
1
If your plan is to reinvest dividends, wouldn't you rather the company not pay dividends altogether?
Expanding a bit on J. Mini's answer, which I think is the biggest point here: the answer is because some investors want dividends, not further investment by the company.
Profitable companies could be thought of as being in one of three phases: rapid expansion; steady growth; or established companies with little room for growth (or even contracting).
...
1
If your plan is to reinvest dividends, wouldn't you rather the company not pay dividends altogether?
Case 2 misses out a vital point: Other people don't plan to reinvest the dividends, so to them a share that pays dividends is worth more than one that does not, which will no doubt up the price of shares that do pay out. This makes the dividend-paying share worth more to an investor who wishes to reinvest than a non-paying share, because the share's value ...
4
If your plan is to reinvest dividends, wouldn't you rather the company not pay dividends altogether?
Consider that qualified dividends are taxed same as long term capital gains. A family grossing as much as $100K will see a 0% rate on their dividends. This raises their basis over time, and reduces their total capital gains at the time the stock is sold. For the typical investor, this makes reinvested dividends potentially a better deal.
answered May 21 at 14:58
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If your plan is to reinvest dividends, wouldn't you rather the company not pay dividends altogether?
One factor that you didn't mention is that qualified dividends are taxed at a lower rate which is good but they're still taxed so overall, it's detrimental.
For a dividend paying stock,.share price must appreciate by the amount of the dividend plus another proportional amount for the tax bite less a proportional amount for the compounding of reinvested ...
19
If your plan is to reinvest dividends, wouldn't you rather the company not pay dividends altogether?
Not necessarily. Your reinvestment has no direct effect on the company. But if there were no dividend, all that cash (that would otherwise go to dividends for all shareholders) would be retained by the company and would have to be invested somehow.
XYZ could potentially make a better ROI for you as a shareholder by retaining dividends
Those are the ...
0
Suppose I have a stock ABC of 1000 shares whose ex-dividend date is May 20 (Wednesday) and I sell 500 shares after the market closes on May 19 (Tuesday) during the extended hours of trading, say at 4:14pm EST. Do I still get the dividend for 1000 shares? Or just for 500 shares?
You must own the shares on the ex-dividend date to get the dividend. The date ...
1
You will receive the dividend for shares you bought after-hours the day before ex-dividend, and won't for shares you sold then. So the answers in your case are 500 and 1800.
You can confirm this by observing that a stock price does not suddenly drop at 4pm the day before ex-dividend. The drop occurs overnight between the end of after-hours and the start of ...
0
Selling $100 worth of shares is equivalent to a $100 dividend, but selling when? It can't be a single sale, as the exposure to volatility is different. My single sale of $100 could occur on a day the market happens to temporarily plummet 90% for just a day, and I lose my whole shareholding. This is not a risk with a $100 dividend.
The penny dropped this ...
2
The relevant date is the ex-dividend date. You are only eligible to receive the dividend if you hold the share on that date, thus the value of the share is decreased by the dividend amount immediately afterwards. The risk exposure regarding the exact dividend amount is very concentrated on the ex-dividend date and not spread out. Indeed, it was or is common ...
1
Assuming that you don't buy or sell any more shares before the ex-dividend date then you will get a dividend of $0.025 per share or 10000*0.025 or $250.00 on the 20th or October 2020.
The key is what do you own at the start of that key date, not how many days you owned it. Many companies do quarterly dividends, which work the same way.
3
Not for arbitrary corporations (meaning that companies cannot be "forced" to distribute their profits), but Master Limited Partnerships have a structure similar to what you're describing. They distribute most of their profits to unitholders in a way that's analogous to a dividend but with different tax treatment.
MLPs are limited to certain industries, and ...
5
Remember the back-half of that financial rule - in financial theory, tax consequences aside, you can simply use dividends received to purchase back more stock. Therefore in either case, you have the ability to decide - do you want cash, or do you want to hold more equity?
Receiving the dividend means the value of your shares goes down [because the ...
14
I would argue that there's no difference even in transient low times. The dividend drops the value of the stock equivalently, so there's no difference from a wealth standpoint.
Say you own 100 shares a stock that has a "natural" value of $100 for a total value of $10,000.
Then a pandemic occurs, and it drops in half to $50 for a total value of $5,000. ...
0
Unless you want to give the IRS an interest-free loan, hold on to everything, and file accordingly.
If your situation doesn't change significantly later in the year, you will not owe taxes, so you are fine.
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Foreign tax credit
Line 40500. You may be able to claim this credit for foreign income or
profit taxes you paid on income you received from outside Canada and
reported on your Canadian tax return. Tax treaties with other
countries may affect whether you are eligible for this credit.
See 1 but also look at your T slips for "foreign tax paid"
The tax ...
0
Don't get caught up in dividend yield. Instead, focus on the earnings yield. Dividend yield hasn't been shown to be helpful after controlling for other factors like earnings yield, value and lower volatility. Check out Table 1 here: https://www.onefpa.org/journal/Pages/Dividend%20Investing%20A%20Value%20Tilt%20in%20Disguise.aspx
We're getting into factor ...
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So does the price of the stock depend on the traders/investors or how
much profit that the company makes?
No, the price of a stock depends on the value the market places on it. You have people and companies who buy and sell stocks, the supply and demand of those stocks is what determines the price. Generally, companies that are performing well or have ...
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