Chapter 1 of 6

What is a dividend?

A dividend is your slice of a company's profits, paid out in cash for each share you own.

When a company earns a profit it can reinvest it, or hand some back to shareholders as a dividend. If you own 100 shares and the company pays €0.50 per share, €50 lands in your account — just for holding the stock. Most established companies pay quarterly; some pay monthly or once a year.

Profits split between reinvestment and cash paid to shareholders.

Dividend investing is the patient strategy of building a collection of these payers, so a growing stream of cash arrives whether the market is up or down. Your total return is this income plus any change in the share price.

Dividends are never guaranteed — a company can cut or stop them. That's why the later chapters look at how safe a payout is.

Key terms

Dividend per share: The cash a company pays out per share over a year. On a card, "Div" is this annual dividend per share.
Gross vs. net: Gross is the dividend before tax; net is what actually lands after withholding tax. Quantic tracks both.
Total return: Everything a holding earns you — dividends received plus the change in share price — not just the income.

Try it in Quantic

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