A Comprehensive Review of Theories Dividend Policy

Dividend policy is one of the most importantfinancial management issues and in fact is the basis of firm's assessment. The value of acompany is equal to the net present valueof its future cash flows. Investorsreceive two types of cash yieldsin reciprocation of their risk taking: Dividend and capital gain (resulted from stock vacillation).Dividendis the most important means of paying cash to investors and therefore is of magnificent significance.So far, scholars have proposed multitudes of models and theories to explain and predict effective factors in corporate decision making in terms of dividends. Any new scientific research should investigate and use the results of previous studies andboosttheir outcomes, this article presents a comprehensive review of theories related to dividend policy to ease this process.