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What is Dividend?

Updated October 22, 2026

A dividend is a share of company profits paid out to shareholders.

Some companies pay dividends every quarter to people who own their stock.

Dividend investing is a classic passive income approach.

Dividends can be cut in bad times, so they're not promised.

Example

You own 100 shares and get a $0.50 dividend per share, so you're paid $50.

Questions people ask

Do all stocks pay dividends?

No, many growth companies don't.

Should I reinvest dividends?

Reinvesting helps compounding over time.

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