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

    A distribution of a portion of a company's earnings, decided ...
  2. Income

    Money that an individual or business receives in exchange for ...
  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 ...
  6. Rule Of 72

    A shortcut to estimate the number of years required to double ...
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  3. What are the dividend reinvestment options for a mutual fund?

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  5. Should I sell my shares if a company suspends its dividend?

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