What are dividends?

I mentioned in an earlier post today about it possibly being the right time to invest in shares and that increased cash flow within a company may prompt them to pay a bigger dividend to their shareholders – but what are dividends?

I have to say that until recently I’ve never really taken much notice of them (possibly never quite inderstood why they were paid out), but I’m beginning to see their worth, and in particular how they can be used to help value a company through dividend yields.

There’s a good article at the Motley Fool which explains a lot more about dividends. Go and give it a read.

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