26. Swabeng Discussion: Earning through The Stock Market by Dividends

That Price Appreciation for the previous post was quite exciting right? Anyway, here is the other way to earn in the Stock Market


2. Dividends

As a part owner of the company, aside from the gains that you have earned (or losses incurred), you will be rewarded with dividends. These dividends can be in a form of cash (called cash dividends) or extra stocks (stock dividend).

1. Lets say at April of 2012, you bought 10,000 shares of Jollibee (Code: JFC) and you didn't add more share up to the present day. Aside from the price appreciation that you've gained, you will earn cash dividend per stock (refer to the table below)

Jollibee Dividends

Starting from the bottom part, a 0.58/share, cash dividend for that period would yield 5800 (excluding 10% witholding tax). The for the 0.65/share, cash dividend for that period would yield 6500 (excluding 10% witholding tax) and so on. When you add up all of the cash dividends on the table, it would give you 64,890 pesos (net of taxes). Not bad right?

Can you imagine if you bought more than 10,000 shares (lets say between 50,000 to 100,000 shares), I'm sure you'd be very delighted with your earnings through cash dividends.

That's for Cash Dividends.

Stock Dividends would be a different matter since you'll be rewarded with an additional number shares as the company has earned for a certain period (quarter or semi-annual or annual). I'll try to look for a better explanation for Stock Dividends.

That's all for now.