Homemade Dividends


DEFINITION of 'Homemade Dividends'

A form of investment income that comes from the sale of a portion of shares held by a shareholder. This differs from dividends that shareholders receive from a company according to the number of shares the shareholder has.

BREAKING DOWN 'Homemade Dividends'

The existence of homemade dividends is the reason some financial analysts believe that looking at a companies dividend policy is not important. If investors desires an income stream they will either sell their shares when they want the income or they will invest in other income-generating assets.

  1. Dividend

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  3. Portfolio Income

    Income from investments, dividends, interest, royalties and capital ...
  4. Dividend Policy

    The policy a company uses to decide how much it will pay out ...
  5. Synthetic Dividend

    A type of incoming cash flow that an investor creates with certain ...
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  1. What is the incentive to buy a stock without dividends?

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  3. Do dividends affect working capital?

    Regardless of whether cash dividends are paid or accrued, a company's working capital is reduced. When cash dividends are ... Read Full Answer >>
  4. Do mutual funds pay dividends?

    Depending on the specific assets in its portfolio, a mutual fund may generate income for shareholders in the form of capital ... Read Full Answer >>
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