DIVIDEND PAYOUT RATIO & RETENTION RATIO
The dividend payout ratio (DPR) is the ratio of total amt of dividends paid out to shareholders relative to the net income (earnings after tax & interest) of the company.
It is % of earnings paid to shareholders via dividends.
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Total earnings of a company comprise of 2 parts ~
🔹Dividend payout ratio (the dividend it pays) &
🔹Retention Ratio (the amount it retains for re-investing in the business).
Eg.
✅To attract investors & increase the value of their stock.
✅To reassure investors about the companies financial health.
✅To increase the investors’ confidence in the companies ability to generate earnings.
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✅To increase the demand for the stock as many investors seek regular income in the form of dividends & they would buy more of such dividend distributing cos.
Story of an Indian-origin British trader who made fortunes by trading from his childhood bedroom until he was accused of helping to trigger the flash crash of 6th May 2010 in US Markets.
--- NAVINDER SINGH SARAO ---
A Thread ( Spoiler alert ~ large 🧵)
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Story of Navinder is a real-life Financial Thriller, who was held responsible for FLASH CRASH, the fastest drop in the US market history on 6th May 2010 when the Dow Jones Index crashed up to 9% within mnts only to rebound quickly. He was arrested & punished later.
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WHO IS NAVINDER SINGH SARAO ?
Navinder Sarao, also called the "Hound of Hounslow" by the news & media persons was a self-taught stock market trader who helped cause panic in US markets in 2010 from his childhood bedroom in his parents' home in Hounslow, West London.