“The harder we look at dividend picture, the more it looks as a puzzle, with pieces that just don’t fit together” Black (1976). Brealey and Myers (2002) have stated, “dividend policy is one of the top ten puzzles in finance.” The questions of "Why the corporations pay dividends?" and "Why the investors pay attention to dividends?" have perplexed both financial economists and several researchers from academia from years. However, the answers to these questions are understandable. “Dividends represent the performance to the investor who puts his money in the company at risk. Companies pay dividends to prevailing shareholders to inspire others to purchase new ordinary shares at higher prices. Investors take dividends into account because only through these dividends or the vision of dividends do investors receive a return on their investment or the opportunity to sell their shares at a higher price in the future”.

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Keywords: Dividend Policy, Financial Economists, Shareholders, Investor, Risk.