[vsmith112298]

Where does money for dividend come from

[smearcase]

Wik has a pretty good write-up on it. The following is an excerpt from that Wik article which I find interesting. Dates are established to determine when you have to be in to qualify for the dividend and they have some moves they make to make certain late comers don't get it etc. At or near that time, the company reduces its stock value by about the same amount as the dividend! I am not a financial person but sounds to me like the stockholders finance their own dividend! I could be wrong. Read and interpret for yourself. This comes from the Wik article on dividends:
Ex-dividend date
Main article: Ex-dividend date
The ex-dividend date (typically 2 trading days before the record date for U.S. securities) is the day on which all shares bought and sold no longer come attached with the right to be paid the most recently declared dividend. This is an important date for any company that has many stockholders, including those that trade on exchanges, as it makes reconciliation of who is to be paid the dividend easier. Existing holders of the stock will receive the dividend even if they now sell the stock, whereas anyone who now buys the stock will not receive the dividend.

It is relatively common for a stock's price to decrease on the ex-dividend date by an amount roughly equal to the dividend paid. This reflects the decrease in the company's assets resulting from the declaration of the dividend. The company does not take any explicit action to adjust its stock price; in an efficient market, buyers and sellers will automatically price this in.

[pready]

Divedends are paid from Retained Earnings.