High Return Investments

Dividend

A dividend is the distribution of profits to a company's shareholders.

Earnings that are not retained by a company may be distributed. The
distribution may be in the form of a cash or stock dividend. A company by
paying a cash dividend reduces the financial resources available to it by
the amount of the distribution.

Alternatively, in the case of a stock dividend, there would be more shares
in circulation for the same amount of shareholder equity.

The amount of the dividend is determined every year at the company's annual
general meeting, and declared as either a cash amount or a percentage of the
company's profit. The dividend is the same for all shares of a given class
(e.g. preferred shares). Once declared, a dividend becomes a liability of
the firm.

When a share is sold shortly before the dividend is to be paid, the seller
rather than the buyer is entitled to the dividend. At the point at which it
is the buyer is no longer entitled to the dividend if the share is sold, the
share is said to go ex-dividend. This is usually a few days before the
dividend is to be paid, depending on the rules of the stock exchange. When a
share goes ex-dividend, its price will generally fall by the amount of the
dividend.

The dividend is calculated mainly on the basis of the company's
unappropriated profit and its business prospects for the coming year. It is
then proposed by the Executive Board and the Supervisory Board to the annual
general meeting. At most companies, however, the amount of the dividend
remains constant. This helps to reassure investors, especially during phases
when earnings are low, and sends the message that the company is optimistic
with respect to its future performance.

Some companies have dividend-reinvestment plans. These plans allow
shareholders to use dividends to systematically buy small amounts of stock
often at no commission. Dividends are not yet paid in gold certificates
although this idea has been discussed by mining companies such as Goldcorp.

An alternative to dividends is a stock buyback. In a buyback the company
buys back stock, thereby increasing the value of the stock left outstanding.
In recent years this alternative has become more popular in the United
States because investors generally have to pay more in income tax on
dividends than they would in capital gains tax on an increase in the value
of their stock.

Investment FreshNews:

Gallatin finance director resigns after sending nude photos on city computer (The Tennessean)
Thu, 24 Jul 2008 19:28:07 GMT
An investigation by Sumner County Sheriff's department uncovered explicit pictures and messages sent from former Gallatin Finance Director Matt Stewart's city-issued computer. Stewart resigned July 14 after being confronted by City Attorney Joe Thompson and Police Chief John Tisdale with the evidence, said Gallatin Mayor Jo Ann Graves. Evidence included explicit instant messages and nude photos ...

Stifel Nicolaus' Public Finance Group Opens New Office in East Lansing, Michigan (Centre Daily Times)
Thu, 24 Jul 2008 17:41:09 GMT
Stifel, Nicolaus & Company, Incorporated is pleased to announce that it has expanded its resources in Public Finance with the opening of a new office in East Lansing, Michigan. The new office will be staffed by four professionals formerly associated with Wachovia Securities. This team was the number one underwriter for negotiated bonds in Michigan for the calendar year 2007 and the number one ...

Fitch: U.S. Public Finance Rating Actions In Second Quarter 2008 (Centre Daily Times)
Thu, 24 Jul 2008 16:26:51 GMT
In the second quarter of 2008, the Fitch Ratings U.S. Public Finance group upgraded 35 credits totaling $17.4 billion in par value while downgrading 25 credits totaling $10.7 billion. This resulted in an upgrade-to-downgrade ratio of 1.4:1 in terms of rating changes and a ratio of 1.6:1 on a par value basis. The ratio of the number of upgrades to the number of downgrades declined, for the ...

PSS Finance is without air conditioning (Saipan Tribune)
Thu, 24 Jul 2008 14:12:15 GMT
Some Public School System employees are feeling the heat. Since July 17, the eight staff members and three students in the PSS Finance Department have been working without an air conditioner, acting PSS Commissioner Craig Garrison said.

Benguela: Finance Minister Addresses Talk On Economic Progress (AngolaPress)
Thu, 24 Jul 2008 16:51:05 GMT
Benguela, 07/24 - The recent evolution and perspective of Angolan economy is the theme of a talk that will be lectured on Saturday in Benguela province, by the Finance Minister, José Pedro Morais, in a promotion of the Committee of Bankers of MPLA.

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