DEFINITION of 'Distribution'

1. When trading volume is higher than that of the previous day without any price appreciation.

2. The removal of assets from a retirement account. The assets are then paid to the retirement account owner or beneficiary.

3. A company's payment of cash, stock or physical products to its shareholders.

4. Distributions of income and capital gains that mutual funds make to their investors periodically during a calendar year.

BREAKING DOWN 'Distribution'

1. A market that is in distribution has already hit its apex and is expected to decline.

2. The retirement account owner (or beneficiary) may be required to pay income tax on distributions received during the year. Early-distribution penalties may also apply if the distribution occurs while the retirement account owner is under the age of 59.5. While distributions from IRAs can occur at any time, certain requirements must be met before distributions can occur from qualified plans, 457 plans and 403(b) accounts. Participants must check with their employers regarding the rules of the plan.

3. The income that is generated from an investment trust is given to investors through monthly or quarterly distributions. In this manner, distributions are similar to stock dividends; however, they usually offer much higher yields of up to 10% a year. The distributions received reduce a trust's taxable income and, therefore, little or no income tax is paid.

4. Mutual funds pay out interest and dividend income received from their portfolio holdings as dividends (income distribution) to fund shareholders. In addition, capital gains from the portfolio's trading activities are generally paid out (capital gains distribution) at the end of the year.

  1. Distribution Yield

    The amount of cash flow received or paid out by an annuity, REIT ...
  2. Cash Liquidation Distribution

    The amount of capital that is returned to the investor or business ...
  3. Bear

    An investor who believes that a particular security or market ...
  4. Consolidation

    In technical analysis, the movement of an asset's price within ...
  5. Individual Retirement Account - ...

    An investing tool used by individuals to earn and earmark funds ...
  6. XDIS

    A symbol used specifically upon the consolidated tape to indicate ...
Related Articles
  1. Stock Analysis

    What is Google Express?

    Understand what Google Express is and how it operates. Learn about the benefits and drawbacks to shopping with Google Express and if it's a good service.
  2. Taxes

    Preparing For Retirement Plan RMD Season

    Paying taxes is inevitable - that's why you need to learn about the rules for required minimum distributions.
  3. Retirement

    IRA Assets And Alternative Investments

    Interested in non-traditional investing? Make sure you follow the rules to avoid prohibited transactions.
  4. Taxes

    9 Penalty-Free IRA Withdrawals

    If you need to take early distributions, find out which exemptions allow you to avoid expensive consequences.
  5. Taxes

    6 Important Retirement Plan RMD Rules

    Paying taxes is inevitable - that's why you need to learn about the rules for required minimum distributions.
  6. Options & Futures

    Strategic Ways To Distribute Your RMD

    We give you some tips on preserving your nest egg in the face of unavoidable withdrawals.
  7. Retirement

    Wealth-Building IRA Rollovers

    Rollovers allow your tax-deferred retirement assets to grow, even when the world around you is changing.
  8. Investing

    Time to Bring Active Back into a Portfolio?

    While stocks have rallied since the economic recovery in 2009, many active portfolio managers have struggled to deliver investor returns in excess.
  9. Mutual Funds & ETFs

    The Democratization of the Hedge Fund Industry

    The coveted compensations of hedge fund managers are protected by barriers of entry to the industry, but one recent startup is working to break those barriers.
  10. Retirement

    Two Heads Are Better Than One With Your Finances

    We discuss the advantages of seeking professional help when it comes to managing our retirement account.
  1. How does the Fair Accounting Standards Board (FASB) regulate deferred tax liabilities?

    The Financial Accounting Standards Board (FASB) requires that deferred tax liabilities be recognized whenever there is a ... Read Full Answer >>
  2. Can I withdraw money from my Roth IRA?

    You can withdraw money from your Roth IRA; whether the withdrawal is penalized and at what rate it is taxed depends on a ... Read Full Answer >>
  3. Is an IRA a qualified plan?

    A qualified plan refers to whether or not an investment plan offered by an employer qualifies for tax breaks under internal ... Read Full Answer >>
  4. Health problems caused me to take my RMD after the deadline. Can I appeal my case ...

    When you missed your required minimum distribution (RMD), you should have sent in a letter of explanation and filed IRS ... Read Full Answer >>
  5. Do I still have to pay penalties and taxes on money that I don't roll over from a ...

    It depends. Let's address the two penalties that will apply - the 10% early-withdrawal penalty and the 20% federal withholding ... Read Full Answer >>
  6. Can my spouse and I use our IRAs to purchase our first home?

    IRA owners can make penalty-free distributions to buy a first home for themselves, their spouses, children, grandchildren ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Take A Bath

    A slang term referring to the situation of an investor who has experienced a large loss from an investment or speculative ...
  2. Black Friday

    1. A day of stock market catastrophe. Originally, September 24, 1869, was deemed Black Friday. The crash was sparked by gold ...
  3. Turkey

    Slang for an investment that yields disappointing results or turns out worse than expected. Failed business deals, securities ...
  4. Barefoot Pilgrim

    A slang term for an unsophisticated investor who loses all of his or her wealth by trading equities in the stock market. ...
  5. Quick Ratio

    The quick ratio is an indicator of a company’s short-term liquidity. The quick ratio measures a company’s ability to meet ...
  6. Black Tuesday

    October 29, 1929, when the DJIA fell 12% - one of the largest one-day drops in stock market history. More than 16 million ...
Trading Center