Dividend Stocks Dividend Yield
If we are going to talk about dividend stocks we need a way to compare dividends. A dividend is an amount paid to shareholders of a company stock as a return of shareholder capital. Dividends are a sign of a healthy company since the only way for a company to pay out cash is to actually have cash. There is no way to hide a cash payment in a company’s account. This cash payment is part of an individual investor’s overall return. What Is Yield? The yield is simply the return provided by an investment. An investment of $1,000 that returns $100 to you provided a yield of $100. Simple right? But, there are some important variables that need to be understood in order to compare yields. Check out this Zelle review. For example, compare two $1,000 investments. One investment returns $100 in one month. The second investment returns $100 in ten years. Obviously, the first investment is far superior to the second investment. Over the same period of time, the first investment would return $12,000 versus just $100, assuming no reinvestment. Any real comparison of dividends requires that we take time into consideration. What Is Dividend Yield? The dividend …
