Remember
Companies that pay dividends are more mature companies with less growth opportunities to put their earnings into. Investors who invest in dividend paying stocks are looking for stability and income. There's a "Clientele" effect with dividend paying stocks. Dividend policy is a sensitive thing. If the dividend is cut those income investors may dump the stock, and play havoc with the price.
Best of Luck
Christ. You don't know how dividends work and you are even remotely considering doing it for a living? Dream on. You get paid on dividends for as long as you own the stock. The Board of Directors for the company decides each dividend period how much the dividend will be. It is possible that the company will stop paying dividends, if they go through an extended period with no profits, but most companies will always try to maintain their dividends through thick and thin.
The company determines whether they will pay dividends and how much per share each and every time. They can increase, decrease or stop the dividend or all of the above as they see fit.
No, stock trading is NOT self-employment if you are using your own money. It is only self-employment income if you are receiving fees to trade with someone else's money. Each of these has completely different tax treatments. Self-employment income is EARNED income. Things like capital gains and collecting rent on a piece of property are NOT earned income.
As others said, low profit may result in dividend cuts. But that usually occurs after extended poor performance, not as the result of a bad year. If you keep up with the dividend stocks you own, you should see the potential for a dividend cut coming.
More concerning for the dividend investor is the sudden and drastic cuts. Such as Pfizer's 50% cut in 2009 to pay for an acquisition. Or more recently BNP Paribas slashing their dividend to pay a fine.
Dividend investors need to have a broad portfolio of dividend paying stocks. Then if (or when) one of them cuts the dividend the loss of income won't be as pronounced.
As long as the company is making enough profits, you will get the dividends until you sell the shares.
If trading stocks is your sole source of income, then you are self-employed. If you are working in another job that pays a wage or salary, even though you trade stocks, you are not self-employed.
Assuming the business is making enough profit to pay dividends they keep paying until you sell the shares.
Self employment ? I don't think so, you are really gambling, but you would be liable for income tax if your income exceded your allowance and also tax when you sell the shares if you make a profit over your allowance.
There is no definitive answer to this.
A company pays dividends out of profit (earnings) or in a bad year, out of reserves. If there is profit or earnings, or reserves, it will continue to pay dividends.
If not, it will either reduce dividends, temporarilly stop paying them or never pay them again.
This is one important point of investing to figure out the earnings growth of a company.
Depending on the net profit and funds flow. If they want to have any modernization, they may divert the funds
stopping payment of dividend
As long as the co is making protfits thats what i found out in my book.
If i hold shares of a stock that pays dividends, is there a point where the stock stops paying, or does it pay until i sell the shares?
( P:S - is trading stocks for a living considered self employment?)
