How long does it take to receive dividends after buying stocks? is a common question of many investors. If you are also interested in this issue, let's find out with HVA.
I/ What is stock dividend?
Buying stocks helps a person optimize portfolio By diversifying their assets, buying stocks contributes to increasing the value of their investments and helps investors receive regular profits from companies with growth potential.
Stock dividends are the portion of profits that a company pays to its shareholders from its after-tax profits. Owning a company's stock means that you become a shareholder of that company, with the right to receive dividends if the company decides to distribute profits. Receiving dividends from stocks not only brings profits to investors but also reflects the financial situation of a business.
II/ How long does it take to receive dividends after buying stocks?
>>> See more articles: Which stocks should new stock investors buy?
When investors buy shares of a company, one of the most common questions is “How long does it take to receive dividends after buying stocks?”. Câu trả lời phụ thuộc vào lịch chi trả cổ tức của công ty thường bao gồm các mốc thời gian như ngày giao dịch không hưởng quyền (ngày nhà đầu tư mua cổ phiếu sẽ không còn quyền nhận cổ tức) và ngày chốt danh sách cổ đông (ngày xác nhận cổ đông đủ điều kiện nhận cổ tức).
III/ How long do I have to hold stocks to receive dividends?
To receive dividends, investors must hold their shares for a certain period of time, namely before the record date. Companies typically publish a dividend schedule, which identifies the ex-dividend date and the record date. If an investor holds shares before this date, they will receive the dividend in the next payment period, regardless of whether they continue to hold the shares after that date. This means that investors only need to hold shares before the record date to be eligible for dividends.
IV/ Cách nhận cổ tức chứng khoán
Once the dividend eligibility conditions have been met, investors will be paid in two common forms: cash or stock.
- Receive cash dividends: Money will be transferred directly to the investor's securities account or through other methods according to the company's regulations.
- Receive stock dividends: Instead of paying in cash, the company will issue additional shares to distribute to shareholders. The number of shares received depends on the distribution ratio announced by the company. The choice of form of dividend payment depends on the policy of each company and investors can choose the method that suits their needs.
The dividend receiving process will follow the following specific order:
- Step 1: Determine the form of dividend payment:
Companies usually pay dividends in two forms as mentioned above:
Cash dividends are the most common form, the amount received will depend on the number of shares the investor owns and the dividend rate announced by the company. For example, if the investor owns 1,000 shares and the company pays a dividend of VND 1,000/share, the investor will receive a dividend of VND 1,000,000.
Instead of being paid in cash, investors will receive additional shares from the issuing company, the number of shares received will be based on the stock dividend ratio. For example, if the company announces a dividend ratio of 10%, investors will receive 10 additional shares for every 100 shares they own.
- Step 2: Satisfy the conditions for receiving dividends
To know whether to receive dividends or not, two important conditions must be met:
Owning shares before the ex-dividend date: If an investor buys shares after this date, they will no longer be entitled to receive dividends in the upcoming payment.
Record Date: This is the date on which the company determines the list of shareholders who are entitled to receive dividends. If they are on this list, they are eligible to receive dividends regardless of whether the investor sells their shares later.
- Step 3: The company pays dividends
The company announces dividend payment information (including ex-dividend date, shareholder record date, and payout ratio)
After confirming the shareholder list, the company will pay dividends to the investor's securities account if it is a cash dividend or the company will allocate additional shares to the account if it is a stock dividend.
- Step 4: Time to receive dividends
The timing of receiving dividends will depend on the company's payment schedule. Cash dividends can usually be transferred within a few weeks to a few months from the shareholder record date. If the dividend is in the form of shares, the time to receive it may be longer due to the need to carry out the procedure of issuing new shares.
Note when receiving dividends:
For cash dividends, investors may have to pay personal income tax. Currently, this tax is usually 5% on the total amount of dividends received.
After a dividend is paid, the market price of the stock may adjust downward in proportion to the value of the dividend paid, especially when a stock dividend is distributed.
Mastering the dividend payment process will help investors manage dividend receipt more easily, thereby optimizing investment profits smoothly and conveniently.
V/ Factors affecting how long it takes to pay dividends after buying stocks:
Để nhận được cổ tức từ việc stock investment, nhà đầu tư cần lưu ý về các mốc thời gian quan trọng như ngày giao dịch không hưởng quyền và ngày chốt danh sách cổ đông. Bên cạnh đó không phải lúc nào nhà đầu tư cũng sẽ nhận được cổ tức ngay lập tức sau khi mua cổ phiếu. How long does it take to receive dividends after buying stocks? depends on the following three important factors:
- Company dividend payment policy: Each company has a different dividend payment schedule, depending on business performance and management decisions.
- Company financial situation: If a company is not profitable or experiences financial difficulties, dividend payments may be delayed or reduced.
- Legal procedures: The issuance and payment of dividends must comply with legal regulations, so the timing of receiving dividends may also be affected by this process.
In short, for those who are considering investing in stocks to receive dividends, it is important to understand the terms and conditions. How long does it take to receive dividends after buying stocks? is very important, closely related to investors optimizing profits from their investments. If you still have questions about how long it takes to receive dividends after buying stocks or investment-related issues, do not hesitate to contact us. HVA Group – We are proud to be a reputable business specializing in providing consulting services and supporting securities investment, helping you make the right and effective investment decisions for yourself.
