Dividend-paying stocks are shares in companies that return a portion of their profits to shareholders in the form of dividends. These payments can provide a steady income stream, making them attractive to investors seeking regular cash flow. Companies that pay dividends are often well-established and financially stable.
Investors typically receive dividends on a quarterly basis, although some companies may pay them annually or semi-annually. The amount of the dividend can vary based on the company's performance and board decisions. Many investors reinvest these dividends to purchase more shares, potentially increasing their overall returns over time.