Dividend
A dividend is a share of a company's profits paid out to shareholders, usually every quarter. It's one of two ways stocks make money — the other is price appreciation — and reinvesting dividends instead of spending them is a major driver of long-run compounding.
Dividend yield is the annual dividend divided by the share price. Qualified dividends are taxed at lower long-term capital-gains rates, while dividends inside a retirement account grow tax-deferred or tax-free.
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