We were all noobs once :-)
There is a date that a company declares its stock as "ex dividend"--you must own that stock BEFORE that date to collect the dividend. Otherwise the dividend is paid to the previous owner.
The Wikipedia definition is pretty straightforward:
http://en.wikipedia.org/wiki/Ex-dividend_date.
If you purchase a dividend paying stock, the money will be paid into your brokerage account. It will show up as CASH. It can then be transferred to your bank account, or reinvested.
OR, you can DRIP (wiki that as well). Then the dividends are reinvested into the company in the form of new stock purchase(s). All but a few of my holdings are DRIP—compounding interest is the best interest ;-)
Believe it or not, wiki and Investopedia are very helpful for decoding investment “lingo.”
http://www.investopedia.com/terms/e/ex-dividend.asp
Ronn
There is a date that a company declares its stock as "ex dividend"--you must own that stock BEFORE that date to collect the dividend. Otherwise the dividend is paid to the previous owner.
The Wikipedia definition is pretty straightforward:
http://en.wikipedia.org/wiki/Ex-dividend_date.
If you purchase a dividend paying stock, the money will be paid into your brokerage account. It will show up as CASH. It can then be transferred to your bank account, or reinvested.
OR, you can DRIP (wiki that as well). Then the dividends are reinvested into the company in the form of new stock purchase(s). All but a few of my holdings are DRIP—compounding interest is the best interest ;-)
Believe it or not, wiki and Investopedia are very helpful for decoding investment “lingo.”
http://www.investopedia.com/terms/e/ex-dividend.asp
Ronn