What is a “Dividend”

I figure this is a fair place to start on here. So let’s start with the question…. What is a “Dividend”. The answer to that question is….

A dividend is a distribution of a portion of a company’s earnings, decided by the board of directors, to a class of its shareholders. The dividend is most often quoted in terms of the dollar amount each share receives (dividends per share). It can also be quoted in terms of a percent of the current market price, referred to as dividend yield.