What is a dividend?

A company declares a quarterly dividend of $0.40 a share. You own 200 shares, so you are paid 200 × $0.40 = $80. Four quarters at the same rate come to $320 a year.

On the ex-dividend date the share price usually drops by about $0.40, so the dividend does not make you $80 richer overnight: value moves from the share price into your cash.

JagSim pays cash dividends into your account on the shares you held before the ex-dividend date, normally the morning after the ex-date; a real broker pays on the company's payment date, usually some weeks later. Portfolio's Upcoming dividends card lists the dividends ahead for what you hold, as estimates from past payments unless a row is marked Announced, and Pro's Dividends received figure totals what you have been paid. Coins pay no dividends. How trading works on JagSim.

How often are dividends paid?

Most US companies that pay one do so every quarter. Some pay monthly, twice a year or once a year, and some pay a one-off special dividend.

Do all companies pay dividends?

No. Many companies, especially fast-growing ones, keep their profits to reinvest in the business.

What is dividend reinvestment?

Using the dividend to buy more shares of the same stock, often automatically through a dividend reinvestment plan (DRIP). The extra shares then earn dividends of their own.

Can a company cut its dividend?

Yes. The board decides each dividend, and none is guaranteed. A company under pressure may cut or stop it.