Money paid out to
shareholders of a
company as a way of sharing
profits. Some
blue-chip companies pay regular dividends, while many new and growth sector companies (dot-coms, for instance) invest all their profits in the company's growth.
Mutual funds may also pay dividends to distribute dividends their holdings have received, or, with
money market funds who have a constant unit value, to represent growth of capital. Many companies who pay regular dividends, and almost all
mutual funds have a
dividend re-investment program whereby investors can receive their dividend in the form of additional shares or units.
A dividend can also mean an additional receipt of something, usually food, eg, "John topped up his soup bowl with a dividend from the tureen."
go back to my big ol' finance metanode.