Course Content
Introduction
The stock market is a marketplace where shares of publicly listed companies are bought and sold. It plays a central role in the modern economy, acting as a bridge between businesses that need capital and investors who have money to invest. The origins of the stock market trace back to the early 1600s, when the Dutch East India Company issued the first shares on the Amsterdam Stock Exchange. This allowed the company to raise money from the public to fund its trade ventures, in return for a share of the profits. Over time, this concept evolved, and today, stock markets exist all over the world, with major exchanges like the New York Stock Exchange (NYSE), NASDAQ, and London Stock Exchange facilitating trillions of dollars in trade. At its core, the stock market enables businesses to grow. By offering shares to the public through a process called an Initial Public Offering (IPO), companies can raise large amounts of money to expand operations, invest in research, or develop new products—without having to rely solely on banks or private lenders. In return, investors get the opportunity to share in the company’s success through rising share prices and dividends. Investing in the stock market can be a powerful way to build wealth over time. Wise investments in strong companies can generate solid returns, especially when held for the long term. Many individuals have grown their savings substantially by investing in companies that have thrived. However, it’s important to remember that the stock market carries risks. Prices can go up, but they can also go down—sometimes sharply. Economic downturns, company mismanagement, or shifts in the global market can all lead to losses. For beginners, it's essential to approach investing with caution, avoid chasing “get rich quick” schemes, and take the time to understand what you're investing in. In short, the stock market is a powerful tool for economic growth and personal financial development—but like all tools, it must be used wisely.
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Introduction
Stock Markets Around The World
Listing On A Stock Market
How Stocks are Bought and Sold
Trade Date vs Settlement Date, What is T + 2?
What Is A Stock Market Index?
ETF’s and Index Funds
Fundamental Analysis
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Fundamental Analysis Introduction
Understanding Revenue and Profit
Earnings Per Share and PE Ratio
Understanding the Balance Sheet
Understanding Cashflow
Dividends – How Investors Earn Income From Their Shares
What Causes Stock Prices To Rise And Fall
Understanding Market Capitalization
Technical Analysis
Along with Fundamental Analysis, Investors increasingly rely on Technical Analysis to decide whether to buy or sell a stock. Here we will explore the main techniques.
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Introduction to Technical Analysis
How To Read A Price Chart – The Basics
Understanding Support and Resistance Levels
Identifying Trends and Drawing Trendlines
Understanding Moving Averages
Introduction to Momentum Indicators
Chart Patterns – Spotting Setups in the Market
Volume – The Power Behind a Price Movement
Investing Safely and Profitably
How do professionals invest safely and profitably? Some key concepts such as position sizing and stop losses.
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How To Place Trades And Manage Risk
Using A Trailing Stop To Protect Profits and Limit Loss
Diversification and Portfolio Management
Taking Profits
Common Investor Mistakes And How To Avoid Them
A Quick Word On Taxes
Summary and Beginner’s Checklist
10 Must Read Books for Investors and Traders
Beginners guide to investing in the Stock Market

Dividends – How Investors Earn Income From Their Shares

 

While some investors make money by buying low and selling high, others earn steady income by holding shares of companies that pay dividends.

 

A dividend is a portion of a company’s profits that is paid out to shareholders, usually in cash. It’s one of the most reliable ways investors earn income — especially in well-established, mature companies.

 

 

What Are Dividends?

 

  • Dividends are typically paid every quarter (every 3 months), but some companies pay them monthly or annually.

  • Not all companies pay dividends — especially younger, fast-growing ones that prefer to reinvest profits back into the business.

 

Example:
If a company pays a $1 dividend per share per year, and you own 100 shares, you would receive $100 per year in dividend income.

 

 

Key Dividend Terms Explained

 

1. Dividend Per Share (DPS)

  • This tells you how much the company pays out per share each year.

  • It can be reported annually or per quarter.

 

Example:
A DPS of $2 annually means you’ll get $0.50 every 3 months if paid quarterly.

 

 

2. Dividend Yield

 

  • Shows how much you earn as a % of the stock price.

 

Formula:
Dividend Yield = (DPS ÷ Share Price) × 100

 

Example:
If a stock pays $2 per year and is priced at $40,
Dividend Yield = 5%

 

This is helpful for comparing income potential across different stocks.

 

 

3. Payout Ratio

 

  • This shows what % of the company’s earnings is being paid out as dividends.

 

Formula:
Payout Ratio = (Dividends ÷ Earnings) × 100

 

Example:
If a company earns $4 per share and pays $2 in dividends, Payout Ratio = 50%

 

A low ratio (under 50%) means the company is retaining plenty of earnings to grow.


A high ratio (above 70–80%) might be unsustainable unless the company is very stable (like a utility or a bank).

 

 

4. Ex-Dividend Date

 

  • This is the cut-off date to be eligible for the next dividend.

  • If you buy shares on or after the ex-dividend date, you won’t receive the upcoming payment.

 

To get the dividend, you must own the shares before the ex-dividend date.

 

 

5. Record Date

 

  • The day the company checks its shareholder records to see who qualifies for the dividend.

  • Usually 1 business day after the ex-dividend date.

 

 

Dividend Timeline Example

 

Date What Happens
Declaration Date Company announces the dividend amount
Ex-Dividend Date You must own shares before this to get paid
Record Date The company checks who’s eligible
Payment Date Dividend is deposited into your account
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Stock Market Course