In this episode, The Finance Ghost joins us to talk about dividends. Dividends are paid when a company returns profits to its shareholders in the form of cash.
Any investment should experience capital growth over time, but could also earn the shareholder dividends. They can then be used as income, or you can reinvest them to accelerate the snowball effect of compound growth.
In this episode, The Finance Ghost answers these questions:
The Finance Ghost suggests you should look at a company’s dividend history and dividend history when making a decision. Paying good dividends signals to the market that the company is doing well.
Companies may choose to hold cash back if they are planning a big acquisition. However, during the global health pandemic, many companies chose to cut their dividends due to uncertainty over the future.
Disclaimer: Old Mutual Life Assurance Company (South Africa) Limited is a Licensed Financial Service Provider. This material is not intended as and does not constitute financial advice or any other advice and is neither exhaustive nor prescriptive. It does not take into account your personal financial circumstances. Your financial adviser will assess your financial situation and needs and assist you to draw up a plan to help you achieve your financial goals. The views expressed by the contributor are his or her own (as an independently registered financial services provider, financial adviser or other independent capacity), and not necessarily endorsed by Old Mutual (as a separate financial services provider).
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