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Finance Glossary

Just call us Bond. Amortized bond.

Over 700 finance terms, Shmooped to perfection.

Stock Dividend

Definition:

The company might decide that it can put its extra cash to better use than paying it as a dividend, so it might instead decide to give the shareholders a stock bonus. Stock dividends don't have any effect on the shareholders' overall wealth. Yes, they own more stock, but the pie hasn't gotten larger; all that happened with the stock dividend is that there are more (and thinner) slices in the pie.

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