Understanding Dividends

What is the most common form of dividend payment?

• Stock options

• Cash

• Bonds

• Real estate

What must you be aware of to ensure you receive a dividend?

• Owning the stock on the ex-dividend date

• Owning the stock on the payment date

• Owning the stock on the record date

• Owning the stock on the announcement date

What is a DRIP in the context of dividends?

• A plan to sell shares before the ex-dividend date

• A plan to receive dividends in cash

• A plan to receive dividends in the form of bonds

• A plan to reinvest dividends into more shares

How is dividend yield calculated?

• Sum of the last two quarterly dividends divided by the stock price, multiplied by 100

• Total dividends paid divided by the stock price

• Sum of the last four quarterly dividends divided by the stock price, multiplied by 100

• Total dividends paid divided by the number of shares

What is a potential risk of investing in dividend stocks?

• They always increase in value

• They may be vulnerable to interest rate changes

• They guarantee a fixed return

• They are not affected by interest rate changes