What is Dividend Yield?

This is just a simple way to compare how large of a Dividend one company is paying compared to another. An example of a Dividend Yield is if the Bitesized Money Inc share price was £100 and they paid a yearly £3 dividend, then the Dividend Yield would be 3% (£3 is 3% of £100). The higher this percentage, the higher the Dividend return you will get on your investment (a 4% Yield would pay £4 per £100 for example).

You don’t have to do this maths yourself though as any decent trading platform will do this for you. As an example, looking a Barclays Bank stock on Google Finance (Barclays), you can see at the time of writing it states “Dividend Yield – 3.77%”. So in simple terms, for every £100 of Barclays stock you own, they will give you £3.77 in cash this year.

Why do Share prices go up and down?

Shares are bought and sold on a Stock Market, and just like any market, prices can move around quite a lot. Imagine you are shopping for some of your favourite apples at the local Fruit Market. But sadly lots of other people like these apples too. The savvy Fruit Trader knows how delicious they are and realises he will have lots of buyers today, so he sets a high price. The first 5 sell out very quickly so he increases the price for the rest, pushing the price higher. This is the same for Shares. Through research or ‘gut feeling’ people will decide if they want to buy a particular apple Share. If they feel someone is selling them cheaply then they will buy them, pushing the price higher. If they think the particular Share looks expensive they will choose to buy something else, leaving the Trader to lower the price of his Shares so he can sell them. It is very difficult to work out what a Share is worth as there are many different things that can impact a price. This is why Shar

What are Dividends in Stocks and Shares?

A Dividend is simply a profit share. If you own Shares in a company, and the company is profitable, typically once a year they will transfer some money into your account, this is called a Dividend. This Dividend is your share of the company’s profits, and you can withdraw and spend it however you wish. Let’s imagine your neighbour Suzy wants to open a Lemonade Stand. She needs some investment to buy lemons, so being a shrewd investor, you offer to give her £100 in exchange for half her company (the Shares) and half of any profit she makes (the Dividend). Suzy has a busy week and sells lots of Lemonade, after buying enough Lemons for next week she is left with £20 of profit. She gives you £10 (the Dividend) and she keeps the other £10. You still own half her company, and you will keep receiving half of the profits every week. In large companies the Directors may decide not to pay all their profits in Dividends, instead choosing to reinvest to buy new machinery, or grow the business. B

What is a Bull Market in Stock and Shares?

A Bull market is when Stock Markets increase in value over a sustained period. You often hear people talk about a Bull Market or a Bear Market, and these are similar but opposite terms. A Bull Market is when Stock Market prices increase by around 20% or more over a sustained period. This can happen when the economy is growing strongly. A recent Bull Market occurred after the Global Financial Crisis in the late 2000s. Low interest rates and other government stimulus caused stocks to grow continuously for an extended period. But why is it called a Bull Market? When Bulls attack with there horns they swipe upwards. This compares to the Stock Market moving upwards in a Bull Market. You can see a Bull statues famously on Wall Street in New York, but other financial institutions also use them. They are typically seen as a symbol of good economic performance.