I understand that a share of stock represents a share of ownership in a company. But if dividends are not paid, what is the actual value of that stock? Why does it have value? The company making more money does not flow to me because I own the stock. So is it basically just like owning a baseball card in that if the player (company) does well more people want to collect (own) their cards (stock) and this the price goes up?
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Let’s say you have a baseball card. That card does not pay you anything but you know that once you decide to sell, you’ll get some cash and that amount is determined how valuable the player on your card is.
Dividends are mostly issued for companies that want to encourage people to buy their stock, it’s also a great way to reward execs/big investors who usually own a lot of stock.
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