Comments on: Accumulation vs. Redistribution http://www.enoughenough.org/2008/02/accumulation-vs-redistribution/ The Personal Politics of Resisting Capitalism Tue, 07 Feb 2012 05:03:25 -0800 http://wordpress.org/?v=2.8.6 hourly 1 By: Alice http://www.enoughenough.org/2008/02/accumulation-vs-redistribution/comment-page-1/#comment-8 Alice Sun, 17 Aug 2008 00:38:41 +0000 http://www.enoughenough.org/?p=9#comment-8 Your understanding of dividends is off. They are not payed anything like savings account interest, nor are they even necessarily connected with the profitability of the company. The company's executive management sets an amount to be paid <i>per-share</i>. The company can't distribute more in dividends than it made in profit, but any amount between that and 0 is legal. So if you own 5000 shares of some company that then pays a dividend of $0.10 this year, you receive $500 at whatever time the company has decided to pay dividends each year. Sometimes, special dividends are issued. In any case, the amount paid is independent of the stock's value, though of course higher dividends tend to raise a stock's price. Your understanding of dividends is off. They are not payed anything like savings account interest, nor are they even necessarily connected with the profitability of the company. The company’s executive management sets an amount to be paid per-share. The company can’t distribute more in dividends than it made in profit, but any amount between that and 0 is legal.

So if you own 5000 shares of some company that then pays a dividend of $0.10 this year, you receive $500 at whatever time the company has decided to pay dividends each year. Sometimes, special dividends are issued. In any case, the amount paid is independent of the stock’s value, though of course higher dividends tend to raise a stock’s price.

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