What is choice dividend delivery?

The paying out of a dividend to the shareholders of a company, delivered in the form of either cash or additional stock if a choice is offered. The cash dividend delivery day can be different to the stock delivery day.

Where have you heard about choice dividend delivery?

Dividend delivery is a key date for investors. Cash dividends provide a regular stream of income, while stock dividends give you extra shares to build the value of your investment over time.

What you need to know about choice dividend delivery.

It’s not compulsory for companies to pay out dividends every year. A firm may prefer to reinvest the profits to fund a new product or expand the business if the board deems it more appropriate.

A cash dividend is straightforward. For each share you own, you'll receive a certain amount of money.

A stock dividend is slightly more complex. A 5% stock dividend, for example, would give you an extra share for every 20 shares you already own. But because the amount of shares in the company increases proportionally, the market value of your shares hasn’t changed.