{"id":3107,"date":"2015-11-08T05:20:43","date_gmt":"2015-11-08T05:20:43","guid":{"rendered":"https:\/\/raizinvest.com.au\/investors\/what-is-a-dividend\/"},"modified":"2020-10-28T02:25:49","modified_gmt":"2020-10-28T02:25:49","slug":"what-is-a-dividend","status":"publish","type":"post","link":"https:\/\/raizinvest.com.au\/investors\/blog\/what-is-a-dividend\/","title":{"rendered":"What is a dividend?"},"content":{"rendered":"

When you invest, that decision
\nand the patience to stick with it will begin to pay dividends \u2013 and not just
\nfiguratively! You will literally be paid something called \u201cdividends\u201d or
\n\u201cdistributions\u201d (we will use dividends for both) from the ETFs in your
\nportfolio; so what are dividends? And how do they fit in with Raiz.<\/span><\/p>\n

A dividend is a portion of a company\u2019s earnings that is returned to
\nshareholders. Companies use dividends to pass on their profits directly to
\ntheir shareholders.<\/span><\/p>\n

A company will pay a small percentage of its profits to the owner of each share
\nof stock.<\/span><\/p>\n


\nExample:<\/b>
\nYou own\u00a01000<\/b>\u00a0shares of fictional company Mighty Oaks. Mighty
\nOaks pay a dividend of\u00a05c<\/b>\u00a0per Share.<\/span><\/p>\n

\\You will receive $50<\/b>\u00a0(Number of Shares Owned X Dividend per
\nShare) in dividend income.<\/span><\/p>\n


\nDividends and ETFs<\/b>
\nAs an Raiz investor, you\u2019ll have a portfolio of ETFs, so that raises a few more
\nquestions\u2026<\/span><\/p>\n


\nDo ETFs pay dividends?<\/b>
\nYes! In short \u2013 and in fact, for the most part, dividends in ETFs are
\nrelatively straightforward. As discussed in our \u201cWhat is an ETF\u201d blog, ETFs are
\nessentially a combination of shares or bonds bundled together. To put it
\nsimply, ETFs basically just take all the dividends from the bundle of shares,
\nand pay all those dividends out to ETF unitholders.\u00a0<\/span><\/p>\n

So, as an ETF shareholder, you benefit from the dividends of all the companies
\nwhich are contained in your ETF.<\/span><\/p>\n


\nWhat will Raiz do with my dividends?<\/b>
\nWith Raiz, your dividends and distributions will be automatically reinvested in
\nyour portfolio. You can view your dividends and distribution history through
\nthe platform, and we will aim to provide information on when the ETFs in your
\nportfolio will pay their dividends.<\/span><\/p>\n


\nWhy reinvest?<\/b>
\nTo answer this it might be useful to understand why some companies don\u2019t pay
\ndividends. One reason for this, is growth. Whilst it may make shareholders
\nhappy to receive a dividend, it may make them even happier if the company keeps
\ntheir profits and invests them to grow the business \u2013 which will in turn, can
\nincrease the value of the stock.<\/span><\/p>\n

We hope that by reinvesting your dividends back into your Raiz portfolio we are
\ninvesting in the growth potential of your portfolio. \u00a0Another step in the
\nright direction, helping your spare change grow.<\/span><\/p>\n

Now you know about dividends, let\u2019s hope that you can start benefiting from
\nthem soon, with Raiz. Sign up today at\u00a0<\/span><\/b>https:\/\/www.Raizinvest.com.au<\/a><\/b><\/p>\n

 <\/p>\n

\n

 <\/p>\n

Don\u2019t have the Raiz App?<\/h3>\n

Download it for free in the App store or the Webapp below:<\/p>\n

\n
\"download-raiz-app\"<\/a>
Click to download the Raiz app<\/a><\/figcaption><\/figure>\n

 <\/figure>\n

Important Information<\/strong><\/span><\/em><\/p>\n

The information on this website is general advice only. This means it does not take into account any person\u2019s particular investment objectives, financial situation or investment needs. If you are an investor, you should consult your licensed adviser before acting on any information contained in this article to fully understand the benefits and risk associated with the product.<\/em><\/p>\n

A Product Disclosure Statement for Raiz Invest and\/or Raiz Invest Super are available on the Raiz Invest website and App. A person must read and consider the Product Disclosure Statement in deciding whether, or not, to acquire and continue to hold interests in the product. The risks of investing in this product are fully set out in the Product Disclosure Statement and include the risks that would ordinarily apply to investing.<\/em><\/p>\n

The information may be based on assumptions or market conditions which change without notice. This could impact the accuracy of the information.<\/em><\/p>\n

Under no circumstances is the information to be used by, or presented to, a person for the purposes of deciding about investing in Raiz Invest or Raiz Invest Super.<\/em><\/p>\n

Past return performance of the Raiz products should not be relied on for making a decision to invest in a Raiz product and is not a good predictor of future performance.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

When you invest, that decision and the patience to stick with it will begin to pay dividends \u2013 and not just figuratively! You will literally be paid something called \u201cdividends\u201d or \u201cdistributions\u201d (we will use dividends for both) from the ETFs in your portfolio; so what are dividends? And how do they fit in with […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false},"categories":[1],"tags":[],"yst_prominent_words":[]}