This study examined the relationship between dividend policy and performance of selected quoted firms in Nigeria. Dividend policy is challenging for the directors and financial Managers of any company because different investors have different views on present cash dividends and future capital gains. Another confusion that pops up is regarding the extent of effect of dividends on the share price. Firms equally believe that when dividends are not paid as at when due then it will affect company’s share price. The objective of the study is to examine the relationship between dividend policy and return on assets. Data were sourced through secondary sources. The data collected were tested using E-View. Ordinary least square technique was used for estimation. The study found out that there is no significant positive relationship between dividend policy and return on assets. The study recommends among others that organizations should ensure that they have a good and robust dividend policy in place. This will enhance their profitability and attract investments.
Dividend, Ratio analysis, Derivatives, Hedging
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