19. Dividends

Companies can pay out a part of their earnings in the form of dividends which shareholders receive as one element of their potential return (the other being capital appreciation).

This video provides more information on this and how this looks both from the company's and the investor's perspective.

Category:

Education

Tags:

• stock
• saving
• investing
• savings
• investment
• companies
• dividend
• yield
• business
• finance
• economy

[LeeLeeSaliba]

what happens when you have bonds and the company goes bust

[savingandinvesting]

@LeeLeeSaliba Companies go bust/bankrupt by definition by filing for bankruptcy when no longer able to pay obligations on bonds (coupon/principal). Although often then enter a process of restructuring/renegotiation, typically equity (which is junior to debt) is wiped out (because if debt can not be honoured then def. equity gone typ.) and the senior bondholders take control of company/process and assets. Dividends gone of course typ. as well. Hope that helps and thanks for interest, Michael.

[mystuff414]

@savingandinvesting What are you investing in now? Gold,Silver? How long will wall street rally? Also how do you bet against the U.S. Dollar.

[savingandinvesting]

@mystuff414 The channel is about concepts we can be sure about - that apply in all markets - like diversification, tax savings, dollar cost averaging etc., commodities are a part of that - we'll leave specific recommendations out (a lot of people will argue they don't add value anyway in efficient market). To bet against the US dollar, a hedge fund might convert US dollars to another currency that they think will do better and buy USD back when lower for profit. Hope that helps (a bit), Michael.

[furbaniak]

Great commentary. Check out the iDRiP (finance) app for dividend investors

[RyanStanberry]

thanks for all the info! I'd suggest getting a better microphone though! LOADS of static

[Gmoneyluv4u]

Hi I'm particularly in close encounter with a class action suit where the senior shareholders were given their dividends after a M&A but the smaller shareholders have not received their settlement or share of dividends as a result of the M&A so thanks for the information this is like a testament to my already alluring belief!

[froget86]

Hello,

Is it a fisrt time I'm using this strategy and it worked and I would like to know if it ususally works. I bought 2000 shares of BP goes before going exdividend (.84) pero share. and then at the end of the day I bought puts (25) to protect for the possible fall next day...

The result I collected $1680 in dividends and like $50 from the offset between the stock and puts

is this a good strategy?

[BigCarpFoxRiver]

Great video as always!