Nov 30 2008
Make Extra Money with Stock Dividends
Investing your money in stocks that pay dividends is another way to earn extra money. Dividends are payments that a corporation makes to its shareholders. For example, if you bought 1 share of a $100 stock with a yield of 5% you would receive $5 in dividend payments in a year. Most U.S. companies pay dividends quarterly but other arrangements are possible, such as annually or monthly.
When you invest in a stock that pays dividends you are taking a risk that value of the shares you buy could go down. There is also a chance that the value of the stock could go up. Even if the stock price remains stable you will still be making money from the dividends.
This is a very basic explanation of dividends. The subject is too broad to be completely covered in one blog post. I will post further information about dividends at a later date.
