10 Things Every Dividend Investor Should Know

4. Preferred and Special Dividends:

A preferred dividend is a regular dividend that is paid to preferred stockholders before common stockholders. Preferred stock is a type of stock that typically pays a fixed dividend, and the dividend amount is usually specified in the company’s articles of incorporation. Preferred dividends are generally paid quarterly, and the amount is usually based on a percentage of the stock’s par value.

On the other hand, a special dividend is a one-time, non-recurring dividend that is paid by a company to its shareholders. Special dividends are typically paid when a company has excess cash and wants to distribute it to shareholders. Special dividends can be paid in addition to regular dividends, and the amount of the special dividend is usually determined by the company’s board of directors.