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Lorem Ipsum is simply dummy text of the printing and typesetting industry. Lorem Ipsum has been the industry’s standard dummy text ever since the 1500s, when an unknown printer took a galley of type and scrambled it to make a type specimen book. It has survived not only five centuries, but also the leap into electronic typesetting, remaining essentially unchanged.
It was popularised in the 1960s with the release of Letraset sheets containing Lorem Ipsum passages, and more recently with desktop publishing software like Aldus PageMaker including versions of Lorem Ipsum.
The first year’s income is paid from the 5% of your initial investment that is placed into your income account at the outset of your plan. This is so we can set you up with your portfolio and collect the dividend income over the first year. The amount you receive in year one is based on the actual amount of dividends paid by the selected share portfolio over the previous year.
In year 2, your income is based on the exact amount of dividend income received into your plan over the entirety of year 1. After deducting fees, we distribute the remaining income to you in equal monthly amounts. This will be the exact same process for each of the following years you hold your plan.
The income is fixed at the start of a plan year and will be recalculated in the last month before your plan anniversary. We will contact you before the Plan anniversary to confirm your income for the following year.
Historically the income has increased over time, but this is not guaranteed. Your income may fluctuate from year to year.
This is why we use 5% of your initial investment to fund your income in the first year. That allows us to purchase your share portfolio for you and collect the dividend income over the first year. Once this process is established we simply smooth the payments to you in equal monthly instalments from year 2 onwards.
We are simply paying you the dividend income collected by your shares in the previous year.
It is important to note that at Investore we do not provide advice on the suitability of our products. Our aim is to explain the plan and make the risks as clear as possible so that you can make your own informed decision about the plans suitability for your circumstances and risk appetite.
If you are unsure about the suitability of Dividend Income please seek professional advice.
Investopedia defines a corporate action as, “any event that brings material change to a company and affects its stakeholders, including shareholders and bondholders”
For example a merger, whereby two (or more) separate companies (e.g. Company A and Company B) combine into one larger company (Company AB), is a common form of corporate action (A + B = AB). Other common corporate actions include but are not limited to:
- Demerger: Opposite of merger. AB splits into Company A and Company B.
- Acquisition: Where one company purchases another company. Company A purchases Company B, Company A is larger while company B ceases to exist.
- Return of Capital: Situation where a company returns some of the capital invested by shareholders into the firm. The action results in a decrease in the value of the company by the amount returned and differs from a dividend in that the cash is not paid from profits for a particular period but rather the equity value on the firm’s balance sheet. An example may be when a company sells some of its long term assets (e.g. property) and returns the cash received to shareholders rather than keeping the cash on its balance sheet.
