Cumulative Dividend

Cumulative dividend - A cumulative dividend is when a limitation is placed upon a corporation's ensured payment of preferred dividends, before they are distributed to the common shareholders. When a company fails to distribute its dividends to preferred shareholders with a cumulative dividend, they have to catch up payments, before any distributions can be sent to any of the common shareholders. Unfortunately, a company's common shares do not offer the income or security that a company's preferred shares offer to its shareholders. Preferred stocks generally have a fixed dividend, which is based on the company stock's par value.

Cumulative preferred - A cumulative preferred stock refers to the fact that certain dividends cumulated on the stock in question. There is a provision that comes with the cumulative stock, which states that any dividends, which have not been payout out must be payout to the preferred stock holders first before they are paid out to the common stockholders. Normally a company will have a fixed amount (yield), which it calculates from the par value on the stock each year and normally it is distributed among the preferred stockholders at specific intervals, usually quarterly. However, a situation might occur where the company is having an unusual amount of expenses to deal with and so they suspend giving out the dividends until they can clear up the financial issues. When they resume sending out the dividends they will have to payout all the dividends that were owed to the preferred stockholders first.

Cumulative voting - Cumulative voting is a system whereby minor stockholders will have a bigger voice in the election of a board of directors by being given the power to cast all of their votes to the very same candidate. The opposite procedure is called regular or statutory voting where the shareholder must vote for a different director for each seat available. In block, voting again the shareholder can only award one vote to one candidate per seat available. There are different voting ballads for cumulative voting; a simple one is called the equal and even cumulative voting method. Here the voters vote in blocs but cannot give a single preferred candidate more votes than another one of their favorites. There is also the point's method whereby the voter can allot any number of points to their candidates of choice.

Current yield - The current yield is also known as a bond yield, dividend yield, or simply a yield. The current yield is the annual income on dividends or bonds and it is calculated by dividing the annual cash inflows by the current market price. This formula is not all that accurate because it does not take into consideration that prices fluctuate throughout the year. The reason to make this calculation is to give an investor an idea of what kind of return to expect the year after the bond was purchased. This calculation also does not take into consideration the face value of the bond, only the price it is selling for.

Cushion theory - Cushion theory is also known as short interest theory, and it is a theory which supports when a security has experienced several short interests, there would have to be a rise in price because sooner or later the investors must repurchase the stocks which they have sold short speculating that the price of the stock would fall. Shorting often occurs in weaker companies and investors get their brokers to sell the stock they don't own to bring the price down. However, as they say everything that goes down must eventually come up again and that is what short interest theory purports.