There are two main ways to make money with stocks. The first is from the capital growth, that is selling it higher than you bought it for and making a profit.
The second way is through taking a share of the company’s profit. As an investor you are a part owner of the company, so when they make a profit, some companies decide to share that profit among all their investors, and this is paid in what is known as a dividend.
Who doesn’t like free money?! Dividends are a great form of income for investors and something you should consider next time you’re looking to invest.
In this episode you will learn:
- What a dividend is
- How you can make money from dividends
- What a dividend yield is
- Which companies pay dividends and which don’t
- Which companies are paying the highest dividend in Australia
- What franking credits are and how they impact your tax return