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That's not how dividends work. Dividends are related to how much profit/cash the company has, and how many shares are outstanding. The price of an individual sh
by Godel_unicode 7y ago
That's not how dividends work. Dividends are related to how much profit/cash the company has, and how many shares are outstanding. The price of an individual share doesn't effect that, only issuance of new shares and changes in cash flow.
- ericd 7y agoShares frequently crash in conjunction with economic pullbacks, which mean lower revenue/earnings for companies, which means less spending by those companies, which means lower revenue/earnings for other companies, and layoffs, which means lower earnings for workers, which means less spending, etc etc.
- Godel_unicode 7y agoShares of individual companies also frequently crash for reasons totally unrelated to economic pullbacks, and thus none of those things are guaranteed to happen simply because a share now costs less.
- ericd 7y agoSure, but I assume we're generally talking about index/portfolio investing here when we talk about stocks in general?