Financial Terms Glossary

Dividend

Formal

A term used to describe the distribution of company profits to the ordinary stockholders of the business. Dividends are paid per share - and therefore reflect the share of total distributed profits based upon numbers of shares held.

Informal

'I want my share of the cake' - you no doubt screamed as a child. Getting your share of the action or profit is a core human emotion. When companies make profits, it sends them out to grateful investors pro rata to the shares they hold. This is a dividend.

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