What are Dividends?

What are Dividends?

A dividend is a payment made by a corporation to its shareholders.
It is a distribution of the companies profits.
Not all companies pay dividends to shareholders.

Why do some companies not pay Dividends to share holders?

• Sometimes they use all profits to grow and expand the company.
• Start-ups and high-growth companies do not turn a profit in the first few years
• These are mainly companies that focus on science and technology

Which companies pay the highest dividends on average?

Large established companies with predictable profits often pay the highest dividends.
These companies are usually in the following sectors:

• Oil & Gas
• Utilities
• Healthcare & Pharmaceuticals
• Finance

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