Dividends
Dividends are the distribution of a Company's profits to its shareholders. Most dividends are issued as interim, after the half-yearly results of the company, and final, after the full year's results. You may also have a Scrip dividend, which is the distribution of Company's profits as shares rather than cash. Please note that dividends are not guaranteed.
There are four important dates you should know about in relation to dividends:
- Declaration Date
This is the date on which the board of directors announces the dividend to shareholders and when the dividend will be paid.
- Record Date
On the record date, the company inspects its list of shareholders to see who will be paid a dividend. If your name is not on the list, you do not receive a dividend.
- Ex-dividend date
The ex-dividend date is typically three business days prior to the record date. If you purchase the stock after this date, you will not be entitled to a dividend.
- Payment Date
Dividend is paid out to the shareholders on this date.