Income Investing

Understanding Dividends

Dividends, one of the ways stocks can actually pay you. A dividend is a portion of a company's profits paid out to shareholders. Not all companies pay dividends. Growth companies like Tesla or Amazon often reinvest profits instead. But established companies like Coca-Cola, Johnson and Johnson, and Procter and Gamble have paid dividends for decades. The dividend yield tells you how much income you get relative to the stock price. If a stock costs 100 dollars and pays 3 dollars per year in dividen