💰 What is a Dividend?

A dividend is a portion of a company’s profit that is distributed to its shareholders as a reward for investing in the company.

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🔍 Simple Definition

A dividend is the income you earn from your shares, paid by the company.

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🧠 Example

If you own shares of Infosys and the company declares a dividend of ₹20 per share:
👉 If you hold 100 shares → You receive ₹2,000 as dividend

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📊 Types of Dividends

1. Cash Dividend
   • Paid directly in money to your bank account
2. Stock Dividend (Bonus Shares)
   • Paid in the form of extra shares
3. Interim Dividend
   • Paid during the financial year
4. Final Dividend
   • Paid at the end of the financial year

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🏢 Why Do Companies Give Dividends?

• Share profits with investors
• Build investor trust
• Attract more investors

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⚠️ Important Points

• Not all companies pay dividends (especially growth companies)
• Dividend amount depends on company performance
• You must hold shares before the record date to receive dividends

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💡 Dividend Yield (Bonus Concept)

Dividend yield shows how much return you get from dividends compared to share price:$$\text{Dividend Yield} = \frac{\text{Dividend per Share}}{\text{Share Price}} \times 100$$Dividend Yield=Share PriceDividend per Share​×100

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A dividend is a passive income source for investors and an important factor while choosing stocks for long-term investment.