Buy stock ex dividend

Jump to main navigation Jump to main content. Last updated Friday, Jun. I recently lost a substantial dividend and I am trying to avoid the same mistake again. However, I did not receive it. What did I do wrong?

To understand why, you need to familiarize yourself with four key dividend dates. The first date you need to know is an easy one: This is the date when the company announces the dividend. This is the date on which the company actually sends out the cash, either to shareholders directly or to their brokerage firms. In between the declaration and payment dates, there are two other key dates to know: This is the date that you have to officially own the shares in order to receive the dividend.

So, to be entitled to the next dividend, you would have to buy your shares at least three business days before the record date and the record date itself would also have to be a business day.

Dividend Stock Basics

What happens if you buy the stock two business days before the record date, you ask? Well, you would not be entitled to the next dividend. In effect, you get to buy the shares at a discount as compensation for not receiving the next dividend. In fact, the stock could even rise, because prices are subject to all sorts of forces on any given day.

At first glance, it seems as if you should have. After all, you placed your order on May 28, three days before the record date of May You would have had to purchase the stock on May 27 to get the dividend; you placed your order on May 28, which was the ex-dividend date.

If that were the case, everyone would buy stocks just in time to pocket the dividend, then quickly sell them and move on to the next opportunity. Unfortunately, no such free lunch exists. Follow John Heinzl on Twitter: INVESTOR CLINIC How many stocks do I need for a diversified portfolio?

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Commerce Bancshares Series B Non-Cumulative Perpetual Preferred Stock Ex-Dividend Reminder - qyzofolawory.web.fc2.com

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Ex-dividend date - Wikipedia

INVESTOR CLINIC Four dividend dates every investor needs to know Add to Comments Share via email Share on facebook Share on twitter Share on LinkedIn Print License article. More Related to this Story INVESTOR CLINIC How many stocks do I need for a diversified portfolio?

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