Cumulative Dividends

Cumulative Dividends (Equity) – An investment term requiring that unmet dividend/distribution obligations accumulate from one period of time to the next. For example, if preferred dividends/distributions were to accrue for two years without being paid, the cumulative Issuerobligations would be for all of the unpaid dividends/distributions which had accrued over the previous two years. Cumulative dividends may or may not compound, depending of the security’s terms.

Back to Glossary of Terms