What is a dividend yield?

[MoneyWeekVideos]

sterlingpower - thanks. And yes if you want the CASH dividend in your hand you have to buy before the ex-div date. However if you miss this, the share price will simply correct downwards as you cross from cum-div to ex-div (a specific day, published for all companies). Net result - you pay less for the share because you are not entitled to the next dividend. So it's just a cash flow effect - you don't lose out as such for missing the ex-date.

[sterlingpower]

Tim i do love these videos you are doing.

How long do you have to hold dividends for to get the dividend pay out? I read up about how you must buy before the ex-dividend dates and your name will be recorded by the record date and you are then entitled to the full 5%(e.g) dividend payout. This seems ludicrous, surely people would simply buy the stock, dump it several days later or so and get the full 5% on their investment. Hope you can help, Charlie

[rodctenis]

@robnfc1 Yes in theory, but in practice in many cases dividends are paid quarterly.

[rodctenis]

@robnfc1 I don't know the jurisdiction you are talking about. In many jurisdictions, the dividends go to shareholders holding such conditions couple of days before the dividend is declared (normally 5).

[aaronmoravek]

In the US u can take of 3-5% for inflation(also devalue your stalk) and 15% for cap gains tax then you have nothing

[rodctenis]

@aaronmoravek But capital gains is applicable when you sell the shares, while you keep them there is no capital gain. What you can have is a tax over the dividends.

[aaronmoravek]

@rodctenis either you dont understand what I wrote or you don't understand it at all. if you have a net increase you will eventually get taxed for it for cap gains, and you will get taxed for it with inflation. that is what I meant

[rodctenis]

@aaronmoravek In some jurisdictions the cap gains are calculated with prices adjusted by inflation (cap gains = selling price - buying price adjusted by inflation) as a way to compare apples with apples. I don't know the particular case of USA.

[roundfaceproductionz]

your awesome

[MoneyWeekVideos]

theIGNentertainment2 - you are missing the fact that every dividend you receive can be reinvested back into shares to work for you. So over say a 20 year holding period the dividend in year one can grow for 20 years reinvested, the dividend in year two 19 years and so on. Obviously if you just spend, instead of saving, every dividend you receive this effect is negated! Tim.

[rodctenis]

@MoneyWeekVideos Yes, but investors in stock market don't expect to recover money 100% out of dividends. At least is not the general rule.

[theIGNentertainment2]

ok so if you make 5% of your original investment every year wont it take like 20 years for you to break even on your investment? am i missing something?

[rollingcube]

excellent

[Leon112006]

very good video good explanation. :-)

[fredeberlein]

Sorry for the "dislike" but it is very hard to hear the speaker. I suggest doing a test of the mic next time before filming.

[HersheyVolts]

This was a great, explicit explanation of the dividend yield ratio- just what I needed! And useful additional comments included! Thank you :)

[HETTIARACHCHIGE123]

How do I find sector or FTSE 100 average? Thank you very much

[05lightscameraaction]

This was very helpful. Thank you.

[VyperVPN]

Excuse me professor, how long do I have to hold the share so that the company will pay out the dividend to me? Thanks!

[sourplum]

@VyperVPN : me too, want to know the answer

[shadowsofdream]

thank you sir

[jjjooorrrjjjooorrr]

thanks!



[TULIP5POINT]

Simple as! Thanks