17.1 Cash Dividends
Dividends or more appropriately cash dividends are payments of cash to the owners of a company. As such, they are taxable as income. At one time, nearly 85% of all firms listed on the NYSE paid cash dividends on a regular basis. With the downturn in the economy in the early 2000s, that number fell to around 65%, and it has continued to fall since the financial meltdown of 2008. Yet a majority of the largest U.S. firms still pay regular quarterly cash dividends. There is a formal process for the paying and timing of dividends in a typical firm, and we now turn to those mechanics.
Buying and Selling Stock
Before turning to an examination of dividends per se, we need to look at the process of buying stocks to understand when ...
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