Business, Legal & Accounting Glossary
The first day of the ex-dividend period. The ex-dividend date was created to allow all pending transactions to be completed before the record date. If an investor does not own the stock before the ex-dividend date, he or she will be ineligible for the dividend payout.
Further, for all pending transactions that have not been completed by the ex-dividend date, the exchanges automatically reduce the price of the stock by the amount of the dividend. This is done because a dividend payout automatically reduces the value of the company (it comes from the company’s cash reserves), and the investor would have to absorb that reduction in value (because neither the buyer nor the seller are eligible for the dividend).
The ex-dividend date is the date on which sellers rather than buyers of a stock have a right to a declared dividend. When a company declares a dividend, it sets a date of record that determines which shareholders receive the dividend. After the record date is set, the stock exchanges or the National Association of Security Dealers set the ex-dividend date. In most cases, the ex-dividend date is two business days before the record date: If the record date is on Thursday, the ex-dividend date is on Tuesday. A buyer of the shares on Monday will have rights to the dividend; a buyer on the ex-dividend date of Tuesday will not. Similarly, a seller of the shares on Monday won’t receive the dividend; a seller on the ex-dividend date of Tuesday will. The stock price before the ex-dividend date will reflect the dividend payment; the stock price on or after the ex-dividend date is reduced to reflect its absence. On and after the ex-dividend date the stock is marked with an “x” in stock tables to show its trading “ex-dividend.”
The ex-dividend date was coming up hard and we all had to get ready because it was very important to us.
You may want to try and close the deal on the ex-dividend date so that it will go over well with the other party.
The ex-dividend date had not yet been reached so we finally proceeded with scheduling the meeting for after this date.
DNR
dividend rollover plan
date of record
dividend notification
reinvestment date
ex-stock dividends
ex-date
Do Not Reduce
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This glossary post was last updated: 30th October, 2021 | 0 Views.