Dividend capture is a stock market strategy that requires less risk. It is a great way for companies to make a profit. However, if you know absolutely nothing about it, now is the time to take advantage of it by learning more about the concept through this article.

What is a dividend?

In reality, a dividend is that part of the profits that a company makes that is allocated to the shareholders. Thus, the dividend capture strategy allows each shareholder with a share to receive an amount of the dividend that is commonly called coupon. Therefore, you need to understand that companies make profits for each of their shareholders for the capital they have invested. Similar to a rent that a landlord must receive from his tenant, coupons are paid annually in some countries like France. However, this is not done automatically, the company holding the dividend may decide to reinvest it simply because they do not have enough. In addition, it should be noted that the dividend is paid in cash and only in rare cases is it paid in shares.

Why do we pay dividends?

Unlike the French, Americans pay dividends to their shareholders on a monthly basis. Indeed, this is a way of doing things that is all to their credit. The policy used by investors depends on the stock market and to rely on its payments. In addition, it should be noted that dividends are a calculation and a gamble that some companies make to keep their shareholders in their assets. If your company has made a habit of paying dividends to its shareholders, for example, it must continue to do so in order to motivate them to keep their share. To do otherwise would produce the opposite reaction. Today, this strategy is widespread throughout the world. It is necessary to learn it to stay in the race.