so, if i own a stock, GE for example... Google finance says it paid $.35 or however much. my question is how do they send out these payments. If for example, I have 100 shares, I would receive $35. I'm assuming this would be in the form of a check? If this is so, it would make reinvesting the retained earnings back into the company with such a small holding of the stock extremely difficult. If i were to receive this $35 and i wanted to just buy more GE with it, I would lose $10 on the miniscule transaction

 

It goes to your broker and credited to your account as cash. If you wanted to reinvest the dividend you would need to do that with your broker under a program they might offer for doing it. It's not an industry thing. The mechanics are the same as buying stock. You would simply authorize your broker to purchase more stock on your behalf or as much as the dividend would buy and the change would go to your account as cash.

It would be no different that doing it yourself but it all depends on your broker, they may offer something of a commission discount.

 

My dividends are directly routed to one of my checking accounts. From there it just acts as a normal checking account...debit card and all, with monthly statements.

 

It's pretty hard to describe the joy in getting those quarterly dividends. That's about the only time I feel like I've got this whole investing thing figured out. I am returning almost 7% annually in just dividend payments on my portfolio and my 2nd biggest position is AAPL. Go KMP, LINE, and BP!