On what quantity the Dividend is given in India?
So My question is if I purchased the shares on 03-08-15 then will I get the dividend? Yes if you purchase on 3-Aug, the shares will actually get credited to your account on 5-Aug and hence you will hold the shares on 6-Aug, the record date. In India, the amount of dividend you get is based on the face value of the stock. If the stock's face value is Rs. 10 and the company announced a dividend of 20%, you will receive Rs.2 per share.To see whether you qualify to receive a dividend, see the ex-dividend date of the company. If you purchased shares before that date, you will receive the dividend, else you will not
One big difference:  Interest is contracted.  They can change the rate in the future but for any given time period you know what you're going to get. Dividends are based on how the company did, there is no agreed-upon amount. As a thought experiment I suppose we can ask where dividends came from and what would be different if they never existed. The VOC or Dutch East India Companywas the first to IPO, sell shares and also have a dividend.   There had been trade entrepot before the VOC, the bulk cog (type of sea-going ship) trade in the Hanseatic League, but the VOC innovation was to pool capital to build giant spice freighters - more expensive than a merchant partnership could likely finance (and stand to lose at sea) on their own but more efficient than the cogs and focused on a trade good with more value.  The Dutch Republic became rich by this capital formed to pursue high value trade. Without dividends this wouldn't have been an innovation in seventeenth century Europe and enterprises would be only as large as say the contemporary merchant family networks of Venice could finance.  So there could be large partnerships, family businesses and debt financed ventures but no corporations as such. "If I invest in index funds or other long term stocks that pay dividend which I reinvest, they don't need to be worth more per share for me to make a profit, right? That is, if I sell part of the stocks, it's GOOD if they're worth more than I bought them at, but the real money comes from the QUANTITY of stocks that you get by reinvesting your dividends, right? I would say it is more the other way around.  It is nice to get dividends and reinvest them, but overall the main gain comes from the stocks going up in value. The idea with index funds, however, is that you don't rely on any particular stock going up in value; instead you just rely on the aggregate of all the funds in the index going up.  By buying lots of stocks bundled in an index fund, you avoid being too reliant on any one company's performance. Can I invest ""small amounts"" (part of paycheck) into index funds on a monthly basis, like €500, without taking major ""transaction fees""? (Likely to be index fund specific... general answers or specific answers using popular stocks welcomed). Yes, you can.  At least in the US, whether you can do this automatically from your paycheck depends on whether you employer has that set up.  I don't know that work in the Netherlands.  However, at the least, you can almost certainly set up an auto-invest program that takes $X out of your bank account every month and buys shares of some index fund(s). Is this plan market-crash proof? My parents keep saying that ""Look at 2008 and think about what such a thing would do to your plan"", and I just see that it will be a setback, but ultimately irrelevant, unless it happens when I need the money. And even then I'm wondering whether I'll really need ALL of my money in one go. Doesn't the index fund go back up eventually? Does a crash even matter if you plan on holding stocks for 10 or more years? Crashes always matter, because as you say, there's always the possibility that the crash will occur at a time you need the money.  In general, it is historically true that the market recovers after crashes, so yes, if you have the financial and psychological fortitude to not pull your money out during the crash, and to ride it out, your net worth will probably go back up after a rough interlude.  No one can predict the future, so it's possible for some unprecedented crisis to cause an unprecedented crash.  However, the interconnectedness of stock markets and financial systems around the world is now so great that, were such a no-return crash to occur, it would probably be accompanied by the total collapse of the whole economic system.  In other words, if the stock market dies suddenly once and for all, the entire way of life of ""developed countries"" will probably die with it.  As long as you live in such a society, you can't really avoid ""gambling"" that it will continue to exist, so gambling on there not being a cataclysmic market crash isn't much more of a gamble. Does what I'm planning have similarities with some financial concept or product (to allow me to research better by looking at the risks of that concept/product)? Maybe like a mortgage investment plan without the bank eating your money in between? I'm not sure what you mean by ""what you're planning"".  The main financial products relevant to what you're describing are index funds (which you already mentioned) and index ETFs (which are basically similar with regard to the questions you're asking here).  As far as concepts, the philosophy of buying low-fee index funds, holding them for a long time, and not selling during crashes, is essentially that espoused by Jack Bogle (not quite the inventor of the index fund, but more or less its spiritual father) and the community of ""Bogleheads"" that has formed around his ideas.  There is a Bogleheads wiki with lots of information about the details of this approach to investing.  If this strategy appeals to you, you may find it useful to read through some of the pages on that site." Check out the NASDAQ and NYSE websites(the exchange in which the stock is listed) for detailed information. Most of the websites which collate dividend payments generally have cash payments history only e.g. Dividata. And because a company has given stock dividends in the past doesn't guarantee such in the future, I believe you already know that. Another answer to this question occurred to me as I started learning more about historical uses for gold etc.  Perhaps it's a crackpot idea, but I'm going to float it anyway to see what you folks think. Investing in Gold is an indirect investment in the Economy and GDP of the nation of India.  To that extent is it only a hedge against inflation, so long as the indian economy grows at a more rapid rate than your local inflation rate.  Fact, India currently consumes more than 1/3 of gold production, predominantly in the form of Jewelry. And their demand has been growing rapidly, up 69% just between 2009 and 2010 alone. I can't find too many historial consumption numbers for India, but when you look at past articles on this subject, you see phrases like 'one forth' and '20%' being used only a few years go to describe India's consumption levels. Fact, India has virtually no domestic sources of gold.  India’s handful of gold mines produce about 2.5 tonnes of the metal each year, a fraction of the country’s annual consumption of about 800 tonnes. Fact. Indian Culture places high value on gold as a visible demonstration of wealth.  Particularly in situations such In Indian weddings where the bride brings in gold to show her family's status and wealth and it forms part of the dowry given to bride. It is believed that a bride wearing 24k gold on their wedding to bring luck and happiness throughout the married life. Fact, the recent trends in outsourcing, Indian citizens working abroad sending money home, etc have all lead to a influx of foreign cash to the Indian economy and explosive GDP growth. See the following chart and compare the period of 2000-current with a chart showing the price of gold in other answer here.  Notice how the curves parallel each other to a large degree  Potentially unfounded conclusion drawn from above numbers.  The rapid growth of the Indian economy, coupled with a rich cultural tradition that values gold as a symbol of wealth, along with a sudden rise in 'wealthy' people due to the economy and influx of foreign cash, has resulted in skyrocketing demand for gold from India, and this large 'consumption' demand is the most likely explanation for the sudden rise in the price of gold over the last several years.  Investors then jump on the 'rising price bandwagon' as especially does anyone that can make a profit from selling gold to those seeking to get on said bandwagon. As such, as long as indian cultural tradition remains unchanged, and their economy remains strong, the resulting increasing demand for gold will sustain current and perhaps increased prices.  Should there be any sudden collapse in the Indian GDP, gold will likely tumble in parallel. disclaimer: not an expert, just observations based off the data I've seen, there may be other parts to the picture of 'gold demand' that I've not considered. "Yahoo's ""Adj Close"" data is adjusted for splits, but not for dividends. Despite Yahoo's webpage's footnote saying  *Close price adjusted for dividends and splits. we can see empirically that the ""Adj Close"" is only adjusted for splits. For example, consider Siemens from Jan 27, 2017 to Mar 15, 2017: The Adj Close adjusts for splits: On any particular day, the ""Adj Close"" is equal to the ""Close"" price divided by the cumulative product of all splits that occurred after that day. If there have been no splits after that day, then the ""Adj Close"" equals the ""Close"" price. Since there is a 2-for-1 split on Mar 14, 2017, the Adj Close is half the Close price for all dates from Jan 27, 2017 to Mar 13, 2017. Note that if Siemens were to split again at some time in the future, the Adj Close prices will be readjusted for this future split. For example, if Siemens were to split 3-for-1 tomorrow, then all the Adj Close prices seen above will be divided by 3. The Adj Close is thus showing the price that a share would have traded on that day if the shares had already been split in accordance with all splits up to today. The Adj Close does not adjust for dividends: Notice that Siemens distributed a $1.87 dividend on Feb 02, 2017 and ~$3.74 dividend on Jan 30, 2017. If the Adj Close value were adjusted for these dividends then we should expect the Adj Close should no longer be exactly half of the Close amount. But we can see that there is no such adjustment -- the Adj Close remains (up to rounding) exactly half the Close amount: Note that in theory, the market reacts to the distribution of dividends by reducing the trading price of shares post-dividend. This in turn is reflected in the raw closing price. So in that sense the Adj Close is also automatically adjusted for dividends. But there is no formula for this. The effect is already baked in through the market's closing prices." The year over year compounding in India has the potential to make up for interest rate parity. But 3% isn't really going to create convenient amounts of earnings either until you get to larger amounts. i will not calculate it for you but just calculate the discounted cash flow (by dividing with 1.1 / 1.1^2 / 1.1^3   ...)of each single exercise as stated and deduct the 12.000 of the above sum.  in the end compare which has the highest npv