These are official events that affect a company’s shares. They also send important signals about what management is thinking.

• Dividend: When a company shares its profits with you. A history of consistent, growing dividends is a strong sign of a healthy, confident business.
• Bonus Issue / Stock Split: The company gives you extra shares for free. This lowers the price per share, making it more affordable for smaller investors. It doesn’t change the value of your holding, but it’s often a sign of confidence from management.
• Rights Issue: The company offers existing shareholders the chance to buy new shares at a discount. They do this to raise money for big projects or to pay down debt. This can be good, but it also means the company’s profits will be spread across more shares (dilution).

NGNSTX Tip:

When a dividend is announced, pay attention to the “ex-dividend date.” You must own the stock before this date to receive the payment. The stock price will usually drop by about the dividend amount on this day, which is perfectly normal.