{"id":25525680,"date":"2022-05-27T10:00:43","date_gmt":"2022-05-27T04:30:43","guid":{"rendered":"https:\/\/entri.app\/blog\/?p=25525680"},"modified":"2022-05-27T01:58:42","modified_gmt":"2022-05-26T20:28:42","slug":"what-is-a-dividend-and-why-is-it-so-important","status":"publish","type":"post","link":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/","title":{"rendered":"What Is a Dividend? And Why Is It So Important?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_79_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69deec5b13a74\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69deec5b13a74\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#What_Is_a_Dividend\" >What Is a Dividend?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#How_a_Dividend_Works\" >How a Dividend Works<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#Types_of_Dividends\" >Types of Dividends<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#Important_Dividend_Dates\" >Important Dividend Dates<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#Why_Dividend_Is_So_Important\" >Why Dividend Is So Important?<\/a><\/li><\/ul><\/nav><\/div>\n<h2 id=\"mntl-sc-block_1-0\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><span class=\"ez-toc-section\" id=\"What_Is_a_Dividend\"><\/span><strong><span class=\"mntl-sc-block-heading__text\">What Is a Dividend?<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p id=\"mntl-sc-block_1-0-1\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">A dividend is the distribution of some of a company&#8217;s earnings to a class of its shareholders, as determined by the company&#8217;s\u00a0board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date.<\/p>\n<p><a href=\"https:\/\/entri.sng.link\/Bcofz\/yv45\/8wer\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25525622 size-full\" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1.png\" alt=\"\" width=\"345\" height=\"345\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1.png 345w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-300x300.png 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-150x150.png 150w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-24x24.png 24w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-48x48.png 48w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-96x96.png 96w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner1-1-1-75x75.png 75w\" sizes=\"auto, (max-width: 345px) 100vw, 345px\" \/><\/a><\/p>\n<h2><span class=\"ez-toc-section\" id=\"How_a_Dividend_Works\"><\/span><strong>How a Dividend Works<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>A dividend\u2019s value is determined on a per-share basis and is to be paid equally to all shareholders of the same class (common, preferred, etc.). The payment must be approved by the Board of Directors.<\/p>\n<p>When a dividend is declared, it will then be paid on a certain date, known as the payable date.<\/p>\n<p><strong>Steps of how it works:<\/strong><\/p>\n<ol>\n<li>The company generates\u00a0profits\u00a0and retained\u00a0earnings<\/li>\n<li>The management team decides some excess profits should be paid out to shareholders (instead of being reinvested)<\/li>\n<li>The board approves the planned dividend<\/li>\n<li>The company announces the dividend (the value per share, the date when it will be paid, the record date, etc.)<\/li>\n<li>The dividend is paid to shareholders<\/li>\n<\/ol>\n<h2><span class=\"ez-toc-section\" id=\"Types_of_Dividends\"><\/span><strong>Types of Dividends<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>There are various types of dividends a company can pay to its shareholders.\u00a0 Below is a list and a brief description of the most common types that shareholders receive.<\/p>\n<p><strong>Types include:<\/strong><\/p>\n<ul>\n<li><strong>Cash<\/strong>\u00a0\u2013 this is the payment of actual cash from the company directly to the shareholders and is the most common type of payment. The payment is usually made electronically (wire transfer), but may also be paid by check or cash.<\/li>\n<li><strong>Stock<\/strong>\u00a0\u2013 stock dividends are paid out to shareholders by issuing new shares in the company. These are paid out\u00a0pro-rata,\u00a0based on the number of shares the investor already owns.<\/li>\n<li><strong>Assets<\/strong>\u00a0\u2013 a company is not limited to paying distributions to its shareholders in the form of cash or shares.\u00a0 A company may also pay out other assets such as investment securities, physical assets, and real estate, although this is not a common practice.<\/li>\n<li><strong>Special<\/strong>\u00a0\u2013 a special dividend is one that\u2019s paid outside of a company\u2019s regular policy (i.e., quarterly, annual, etc.). It is usually the result of having excess cash on hand for one reason or another.<\/li>\n<li><strong>Common<\/strong>\u00a0\u2013 this refers to the class of shareholders (i.e., common shareholders), not what\u2019s actually being received as payment.<\/li>\n<li><strong>Preferred<\/strong>\u00a0\u2013 this also refers to the class of shareholders receiving the payment.<\/li>\n<li><strong>Other<\/strong>\u00a0\u2013 other, less common, types of financial assets can be paid out as dividends, such as options, warrants, shares in a new spin-out company, etc.<\/li>\n<\/ul>\n<h2 id=\"mntl-sc-block_1-0-29\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><span class=\"ez-toc-section\" id=\"Important_Dividend_Dates\"><\/span><strong><span class=\"mntl-sc-block-heading__text\">Important Dividend Dates<\/span><\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p id=\"mntl-sc-block_1-0-30\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Dividend payments follow a chronological order of events, and the associated dates are important to determining which shareholders qualify to receive the dividend payment.<\/p>\n<ul id=\"mntl-sc-block_1-0-32\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">\n<li><strong>Announcement date<\/strong>: Dividends are announced by company management on the\u00a0announcement date\u00a0(or declaration date) and must be approved by the shareholders before they can be paid.<\/li>\n<li><strong>Ex-dividend date<\/strong>: The date on which the dividend eligibility expires is called the ex-dividend date or simply the\u00a0ex-date. For instance, if a stock has an ex-date of Monday, May 5, then shareholders who buy the stock on or after that day will NOT qualify to get the dividend because they are buying it on or after the dividend expiry date. Shareholders who own the stock one business day prior to the ex-date\u2014that is on Friday, May 2, or earlier\u2014will receive the dividend.<\/li>\n<li><strong>Record date<\/strong>: The\u00a0record date\u00a0is the cutoff date, established by the company in order to determine which shareholders are eligible to receive a dividend or distribution.<\/li>\n<li><strong>Payment date<\/strong>: The company issues the payment of the dividend on the\u00a0payment date, which is when the money gets credited to investors&#8217; accounts.<\/li>\n<\/ul>\n<h2 class=\"comp article-heading mntl-text-block\"><span class=\"ez-toc-section\" id=\"Why_Dividend_Is_So_Important\"><\/span><strong>Why <span class=\"mntl-sc-block-heading__text\">Dividend <\/span>Is So Important?<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Five of the primary reasons why\u00a0dividends\u00a0matter for investors include the fact they substantially increase stock investing profits, provide an extra metric for fundamental analysis, reduce overall portfolio risk, offer tax advantages, and help to preserve the purchasing power of capital.<\/p>\n<h3 id=\"mntl-sc-block_1-0-4\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><strong><span class=\"mntl-sc-block-heading__text\">1. Growth and Expansion of Profits<\/span><\/strong><\/h3>\n<p id=\"mntl-sc-block_1-0-5\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">One of the primary benefits of investing in dividend-paying companies is dividends tend to steadily grow over time. Well-established companies that pay dividends typically increase their dividend payouts from year to year. There are a number of &#8220;dividend aristocrats,\u201d or companies that have continuously increased their dividend payouts for more than 25 years consecutively. Over the last 10 years (as of Jan. 28, 2022), the\u00a0compounded annual growth rate\u00a0(CAGR) of the\u00a0total return\u00a0for S&amp;P Global Dividend Aristocrats was 2.72%.<span class=\"mntl-inline-citation mntl-dynamic-tooltip--trigger\" data-id=\"#citation-6\">2<\/span><\/p>\n<p id=\"mntl-sc-block_1-0-7\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">One of the basics of stock market investing is\u00a0market risk, or the inherent risk associated with any equity investment. Stocks may go up or down, and there is no guarantee they increase in value. while investing in dividend-paying companies is not guaranteed to be profitable, dividend stocks offer at least a partial return on investment that is virtually guaranteed. It is very rare for dividend-paying companies to ever stop paying dividends, in fact, most of these companies increase the amount of their dividends over time.<\/p>\n<p id=\"mntl-sc-block_1-0-9\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Many investors fail to appreciate the huge impact dividends have on stock market profits. From 1980 to 2019, 75% of the returns of the S&amp;P 500 came from dividends. This means the inclusion of dividend payments made up the majority of what stock investors have realized in returns on investment as compared to what their returns would have been without dividend payments.<\/p>\n<h3 id=\"mntl-sc-block_1-0-15\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><strong><span class=\"mntl-sc-block-heading__text\">2. Dividends Are Helpful in Equity Evaluation<\/span><\/strong><\/h3>\n<p id=\"mntl-sc-block_1-0-16\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Just as the impact of dividends on total return on investment, or ROI, is often overlooked by investors, so too is the fact that dividends provide a helpful point of analysis in equity evaluation and stock selection. Evaluation of stocks using dividends is often a more reliable equity evaluation measure than many other more commonly used metrics such as\u00a0price-to-earnings, or P\/E ratio.<\/p>\n<p id=\"mntl-sc-block_1-0-18\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Most financial metrics used by analysts and investors in stock analysis are dependent on figures obtained from companies&#8217; financial statements. The potential problem with evaluating stocks solely based on a company&#8217;s financial statements is companies can, and unfortunately sometimes do, manipulate their financial statements through misleading accounting practices to improve their appearance to investors. Dividends, however, offer a solid indication of whether a company is performing well. In short, a company has to have real cash flow to make a dividend payment.<\/p>\n<p id=\"mntl-sc-block_1-0-20\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Examining a company&#8217;s current and historical dividend payout gives investors a firm reference point in basic fundamental analysis of the strength of a company. Dividends provide continuous, year-to-year indications of a company&#8217;s growth and profitability, outside of whatever up-and-down movements may occur in the company&#8217;s stock price over the course of a year. A company consistently increasing its dividend payments over time is a clear indication of a company that is steadily generating profits and is less likely to have its basic financial health threatened by the temporary market or economic downturns.<\/p>\n<p id=\"mntl-sc-block_1-0-22\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">An additional benefit of using dividends in evaluating a company is that since dividends only change once a year, they provide a much more stable point of analysis than metrics that are subject to the day-to-day fluctuations in stock price.<\/p>\n<h3 id=\"mntl-sc-block_1-0-24\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><strong><span class=\"mntl-sc-block-heading__text\">3. Reducing Risk and Volatility<\/span><\/strong><\/h3>\n<p id=\"mntl-sc-block_1-0-25\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Dividends are a major factor in reducing overall portfolio risk and volatility. In terms of reducing risk, dividend payments mitigate any losses that occur from a decline in stock price. But the risk reduction benefit of dividends goes beyond that basic fact. Studies have historically shown that dividend-paying stocks outperform non-dividend-paying stocks during bear market periods. While an overall downmarket generally drags down stocks across the board, dividend-paying stocks usually suffer significantly less decline in value than non-dividend-paying stocks.<\/p>\n<p class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">However, that trend did change of late. There have been three bear markets over the last 20 years, with dividend stocks outperforming during the first two, but during the most recent\u2014amid the coronavirus pandemic\u2014dividend-paying stocks underperformed.<span class=\"mntl-inline-citation mntl-dynamic-tooltip--trigger\" data-id=\"#citation-5\" data-tooltip-position-x=\"center\" data-tooltip-position-y=\"top\">5<\/span><\/p>\n<div id=\"mntl-dynamic-tooltip\" class=\"mntl-dynamic-tooltip\" data-tracking-container=\"true\">\n<div class=\"mntl-dynamic-tooltip--content\">\n<p>Meanwhile, dividend-paying stocks did outperform during the other two bear markets\u2014the tech bubble burst of the early 2000s and during the financial crisis. As well, dividend stocks have proved to be less volatile. Per a Merrill Lynch study, stocks with a history of steadily increasing dividends outperformed non-dividend paying stocks from 1990 to 2018 with less volatility.<span class=\"mntl-inline-citation mntl-dynamic-tooltip--trigger\" data-id=\"#citation-8\">6<\/span><\/p>\n<\/div>\n<\/div>\n<h3 id=\"mntl-sc-block_1-0-31\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><strong><span class=\"mntl-sc-block-heading__text\">4. Dividends Offer Tax Advantages<\/span><\/strong><\/h3>\n<p id=\"mntl-sc-block_1-0-32\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">The way dividends are treated in regard to taxes makes dividends a very tax-efficient means of obtaining income.\u00a0Qualified dividends\u00a0are taxed at substantially lower rates than ordinary income. Per the IRS, for individuals whose ordinary income tax rate is in the highest brackets (35% or 37%), qualified dividends are taxed at only a 20% rate. And for individuals whose ordinary income tax rate is below 12% to 35%, qualified dividends are taxed at 15%, and for those in the 10% or 12% tax brackets, they pay no tax on qualified dividends.<\/p>\n<h3 id=\"mntl-sc-block_1-0-34\" class=\"comp mntl-sc-block finance-sc-block-heading mntl-sc-block-heading\"><strong><span class=\"mntl-sc-block-heading__text\">5. Dividends Preserve Purchasing Power of Capital<\/span><\/strong><\/h3>\n<p id=\"mntl-sc-block_1-0-35\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">Dividends also help out in another area that investors sometimes fail to consider: the effect of inflation on investment returns. For an investor to realize any genuine net gain from an investment, the investment must first provide enough of a return to overcome the loss of purchasing power that results from inflation.<\/p>\n<p id=\"mntl-sc-block_1-0-37\" class=\"comp mntl-sc-block finance-sc-block-html mntl-sc-block-html\">If an investor owns a stock that increases in price 3% over the course of a year, but inflation is at 4%, then in terms of the purchasing power of their capital, the investor has actually suffered a 1% loss. However, if that same stock that increased 3% in price also offers a 3% dividend yield, the investment has successfully returned a profit that outpaces inflation and represents an actual gain in purchasing power for the investor. The good news for investors in dividend-paying companies is that many dividend yields outpace inflation.<\/p>\n<p>&nbsp;<\/p>\n<p><a href=\"https:\/\/entri.sng.link\/Bcofz\/yv45\/8wer\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-25525623 size-full\" src=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner-1-1.png\" alt=\"\" width=\"970\" height=\"250\" srcset=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner-1-1.png 970w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner-1-1-300x77.png 300w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner-1-1-768x198.png 768w, https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/blog-banner-1-1-750x193.png 750w\" sizes=\"auto, (max-width: 970px) 100vw, 970px\" \/><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>What Is a Dividend? A dividend is the distribution of some of a company&#8217;s earnings to a class of its shareholders, as determined by the company&#8217;s\u00a0board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date. How a Dividend Works A dividend\u2019s value is [&hellip;]<\/p>\n","protected":false},"author":92,"featured_media":25525682,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[802,558,1867],"tags":[],"class_list":["post-25525680","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles","category-general-knowledge","category-stock-marketing"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What Is a Dividend? And Why Is It So Important? - Entri Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Is a Dividend? And Why Is It So Important? - Entri Blog\" \/>\n<meta property=\"og:description\" content=\"What Is a Dividend? A dividend is the distribution of some of a company&#8217;s earnings to a class of its shareholders, as determined by the company&#8217;s\u00a0board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date. How a Dividend Works A dividend\u2019s value is [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\" \/>\n<meta property=\"og:site_name\" content=\"Entri Blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/entri.me\/\" \/>\n<meta property=\"article:published_time\" content=\"2022-05-27T04:30:43+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png\" \/>\n\t<meta property=\"og:image:width\" content=\"820\" \/>\n\t<meta property=\"og:image:height\" content=\"615\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/png\" \/>\n<meta name=\"author\" content=\"Aleena V Noushad\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@entri_app\" \/>\n<meta name=\"twitter:site\" content=\"@entri_app\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Aleena V Noushad\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"8 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\"},\"author\":{\"name\":\"Aleena V Noushad\",\"@id\":\"https:\/\/entri.app\/blog\/#\/schema\/person\/282abb73bf1e2468d08cf486d1f075e2\"},\"headline\":\"What Is a Dividend? And Why Is It So Important?\",\"datePublished\":\"2022-05-27T04:30:43+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\"},\"wordCount\":1583,\"commentCount\":0,\"publisher\":{\"@id\":\"https:\/\/entri.app\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png\",\"articleSection\":[\"Articles\",\"General Knowledge\",\"Stock Marketing\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\",\"url\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\",\"name\":\"What Is a Dividend? And Why Is It So Important? - Entri Blog\",\"isPartOf\":{\"@id\":\"https:\/\/entri.app\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage\"},\"image\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage\"},\"thumbnailUrl\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png\",\"datePublished\":\"2022-05-27T04:30:43+00:00\",\"breadcrumb\":{\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/\"]}]},{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage\",\"url\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png\",\"contentUrl\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png\",\"width\":820,\"height\":615},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/entri.app\/blog\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Entri Skilling\",\"item\":\"https:\/\/entri.app\/blog\/category\/entri-skilling\/\"},{\"@type\":\"ListItem\",\"position\":3,\"name\":\"Stock Marketing\",\"item\":\"https:\/\/entri.app\/blog\/category\/entri-skilling\/stock-marketing\/\"},{\"@type\":\"ListItem\",\"position\":4,\"name\":\"What Is a Dividend? And Why Is It So Important?\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/entri.app\/blog\/#website\",\"url\":\"https:\/\/entri.app\/blog\/\",\"name\":\"Entri Blog\",\"description\":\"\",\"publisher\":{\"@id\":\"https:\/\/entri.app\/blog\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/entri.app\/blog\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/entri.app\/blog\/#organization\",\"name\":\"Entri App\",\"url\":\"https:\/\/entri.app\/blog\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/entri.app\/blog\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2019\/10\/Entri-Logo-1.png\",\"contentUrl\":\"https:\/\/entri.app\/blog\/wp-content\/uploads\/2019\/10\/Entri-Logo-1.png\",\"width\":989,\"height\":446,\"caption\":\"Entri App\"},\"image\":{\"@id\":\"https:\/\/entri.app\/blog\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/www.facebook.com\/entri.me\/\",\"https:\/\/x.com\/entri_app\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/entri.app\/blog\/#\/schema\/person\/282abb73bf1e2468d08cf486d1f075e2\",\"name\":\"Aleena V Noushad\",\"description\":\"Aleena is a passionate Blog writer and a Postgraduate in Master of Computer Application. She also holds a diploma in Aviation and Hospitality. She has been writing for Entri over the past three years, specialising in exam preparation and skill and career development\",\"sameAs\":[\"https:\/\/www.linkedin.com\/in\/aleena-v-noushad-a81632126\/\"],\"url\":\"https:\/\/entri.app\/blog\/author\/aleena\/\"}]}<\/script>\n<!-- \/ Yoast SEO plugin. -->","yoast_head_json":{"title":"What Is a Dividend? And Why Is It So Important? - Entri Blog","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/","og_locale":"en_US","og_type":"article","og_title":"What Is a Dividend? And Why Is It So Important? - Entri Blog","og_description":"What Is a Dividend? A dividend is the distribution of some of a company&#8217;s earnings to a class of its shareholders, as determined by the company&#8217;s\u00a0board of directors. Common shareholders of dividend-paying companies are typically eligible as long as they own the stock before the ex-dividend date. How a Dividend Works A dividend\u2019s value is [&hellip;]","og_url":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/","og_site_name":"Entri Blog","article_publisher":"https:\/\/www.facebook.com\/entri.me\/","article_published_time":"2022-05-27T04:30:43+00:00","og_image":[{"width":820,"height":615,"url":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png","type":"image\/png"}],"author":"Aleena V Noushad","twitter_card":"summary_large_image","twitter_creator":"@entri_app","twitter_site":"@entri_app","twitter_misc":{"Written by":"Aleena V Noushad","Est. reading time":"8 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#article","isPartOf":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/"},"author":{"name":"Aleena V Noushad","@id":"https:\/\/entri.app\/blog\/#\/schema\/person\/282abb73bf1e2468d08cf486d1f075e2"},"headline":"What Is a Dividend? And Why Is It So Important?","datePublished":"2022-05-27T04:30:43+00:00","mainEntityOfPage":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/"},"wordCount":1583,"commentCount":0,"publisher":{"@id":"https:\/\/entri.app\/blog\/#organization"},"image":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage"},"thumbnailUrl":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png","articleSection":["Articles","General Knowledge","Stock Marketing"],"inLanguage":"en-US","potentialAction":[{"@type":"CommentAction","name":"Comment","target":["https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#respond"]}]},{"@type":"WebPage","@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/","url":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/","name":"What Is a Dividend? And Why Is It So Important? - Entri Blog","isPartOf":{"@id":"https:\/\/entri.app\/blog\/#website"},"primaryImageOfPage":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage"},"image":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage"},"thumbnailUrl":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png","datePublished":"2022-05-27T04:30:43+00:00","breadcrumb":{"@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#primaryimage","url":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png","contentUrl":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2022\/05\/Untitled-2022-05-27T010134.080-1.png","width":820,"height":615},{"@type":"BreadcrumbList","@id":"https:\/\/entri.app\/blog\/what-is-a-dividend-and-why-is-it-so-important\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/entri.app\/blog\/"},{"@type":"ListItem","position":2,"name":"Entri Skilling","item":"https:\/\/entri.app\/blog\/category\/entri-skilling\/"},{"@type":"ListItem","position":3,"name":"Stock Marketing","item":"https:\/\/entri.app\/blog\/category\/entri-skilling\/stock-marketing\/"},{"@type":"ListItem","position":4,"name":"What Is a Dividend? And Why Is It So Important?"}]},{"@type":"WebSite","@id":"https:\/\/entri.app\/blog\/#website","url":"https:\/\/entri.app\/blog\/","name":"Entri Blog","description":"","publisher":{"@id":"https:\/\/entri.app\/blog\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/entri.app\/blog\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/entri.app\/blog\/#organization","name":"Entri App","url":"https:\/\/entri.app\/blog\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/entri.app\/blog\/#\/schema\/logo\/image\/","url":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2019\/10\/Entri-Logo-1.png","contentUrl":"https:\/\/entri.app\/blog\/wp-content\/uploads\/2019\/10\/Entri-Logo-1.png","width":989,"height":446,"caption":"Entri App"},"image":{"@id":"https:\/\/entri.app\/blog\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.facebook.com\/entri.me\/","https:\/\/x.com\/entri_app"]},{"@type":"Person","@id":"https:\/\/entri.app\/blog\/#\/schema\/person\/282abb73bf1e2468d08cf486d1f075e2","name":"Aleena V Noushad","description":"Aleena is a passionate Blog writer and a Postgraduate in Master of Computer Application. She also holds a diploma in Aviation and Hospitality. She has been writing for Entri over the past three years, specialising in exam preparation and skill and career development","sameAs":["https:\/\/www.linkedin.com\/in\/aleena-v-noushad-a81632126\/"],"url":"https:\/\/entri.app\/blog\/author\/aleena\/"}]}},"_links":{"self":[{"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/posts\/25525680","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/users\/92"}],"replies":[{"embeddable":true,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/comments?post=25525680"}],"version-history":[{"count":5,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/posts\/25525680\/revisions"}],"predecessor-version":[{"id":25525689,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/posts\/25525680\/revisions\/25525689"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/media\/25525682"}],"wp:attachment":[{"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/media?parent=25525680"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/categories?post=25525680"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/entri.app\/blog\/wp-json\/wp\/v2\/tags?post=25525680"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}