Investing in dividend-paying companies rather than dividend-paying stocks has both advantages and disadvantages. A corporation uses them to distribute a percentage of its revenue to its stockholders. Dividends benefit investors by increasing their return on assets. Bond interest is often contrasted with dividends. A stockholder's total return on investment includes dividend payments.

The vast majority of companies that regularly distribute dividends do so four times per year (once every three months). There is a dividend for every share of stock. A person who holds 30 shares of stock in a company that pays $5 in dividends every year will receive $150 in dividend payments every year (30 shares x $5 per share = $150).

Although it sounds like investing, dividends are actually payments made by companies to their shareholders. Dividends are paid out of the company's earnings and profits, which can be more or less than its actual assets. Shareholders may either reinvest the dividend or sell the shares and use the money for other purposes. The dividends received can be more than an income-generating investment like stocks because they come with the additional benefit of stake in a company's profitability.

The dividend is the payment that a company makes to its shareholders. These are paid out to them, and it is up to them whether to reinvest it, sell shares etc.