S&P 500   4,695.01 (+0.18%)
DOW   35,681.10 (-0.11%)
QQQ   398.37 (+0.14%)
AAPL   174.21 (+1.77%)
MSFT   332.11 (-0.84%)
FB   330.71 (+2.45%)
GOOGL   2,943.67 (-0.06%)
AMZN   3,520.87 (-0.07%)
TSLA   1,066.33 (+1.39%)
NVDA   318.29 (-1.84%)
BABA   126.71 (+0.93%)
NIO   35.09 (+5.95%)
CGC   11.18 (+5.08%)
AMD   145.08 (+0.16%)
GE   98.75 (+1.23%)
MU   85.73 (-0.12%)
T   23.16 (+0.35%)
F   19.91 (-0.25%)
DIS   153.50 (+1.78%)
PFE   51.35 (-0.72%)
AMC   32.96 (+6.19%)
ACB   6.72 (+5.33%)
BA   211.83 (+1.44%)
S&P 500   4,695.01 (+0.18%)
DOW   35,681.10 (-0.11%)
QQQ   398.37 (+0.14%)
AAPL   174.21 (+1.77%)
MSFT   332.11 (-0.84%)
FB   330.71 (+2.45%)
GOOGL   2,943.67 (-0.06%)
AMZN   3,520.87 (-0.07%)
TSLA   1,066.33 (+1.39%)
NVDA   318.29 (-1.84%)
BABA   126.71 (+0.93%)
NIO   35.09 (+5.95%)
CGC   11.18 (+5.08%)
AMD   145.08 (+0.16%)
GE   98.75 (+1.23%)
MU   85.73 (-0.12%)
T   23.16 (+0.35%)
F   19.91 (-0.25%)
DIS   153.50 (+1.78%)
PFE   51.35 (-0.72%)
AMC   32.96 (+6.19%)
ACB   6.72 (+5.33%)
BA   211.83 (+1.44%)
S&P 500   4,695.01 (+0.18%)
DOW   35,681.10 (-0.11%)
QQQ   398.37 (+0.14%)
AAPL   174.21 (+1.77%)
MSFT   332.11 (-0.84%)
FB   330.71 (+2.45%)
GOOGL   2,943.67 (-0.06%)
AMZN   3,520.87 (-0.07%)
TSLA   1,066.33 (+1.39%)
NVDA   318.29 (-1.84%)
BABA   126.71 (+0.93%)
NIO   35.09 (+5.95%)
CGC   11.18 (+5.08%)
AMD   145.08 (+0.16%)
GE   98.75 (+1.23%)
MU   85.73 (-0.12%)
T   23.16 (+0.35%)
F   19.91 (-0.25%)
DIS   153.50 (+1.78%)
PFE   51.35 (-0.72%)
AMC   32.96 (+6.19%)
ACB   6.72 (+5.33%)
BA   211.83 (+1.44%)
S&P 500   4,695.01 (+0.18%)
DOW   35,681.10 (-0.11%)
QQQ   398.37 (+0.14%)
AAPL   174.21 (+1.77%)
MSFT   332.11 (-0.84%)
FB   330.71 (+2.45%)
GOOGL   2,943.67 (-0.06%)
AMZN   3,520.87 (-0.07%)
TSLA   1,066.33 (+1.39%)
NVDA   318.29 (-1.84%)
BABA   126.71 (+0.93%)
NIO   35.09 (+5.95%)
CGC   11.18 (+5.08%)
AMD   145.08 (+0.16%)
GE   98.75 (+1.23%)
MU   85.73 (-0.12%)
T   23.16 (+0.35%)
F   19.91 (-0.25%)
DIS   153.50 (+1.78%)
PFE   51.35 (-0.72%)
AMC   32.96 (+6.19%)
ACB   6.72 (+5.33%)
BA   211.83 (+1.44%)

Ex-Dividend Calendar for the Week of 12/6/2021

A list of stocks going ex-dividend during the week of 12/6/2021 is listed below. In order to receive a dividend, shares of a stock must be purchased no later than the last trading day before the ex-dividend date. Common questions about ex-dividend dates.

MarketRank evaluates a company based on community opinion, dividend strength, institutional and insider ownership, earnings and valuation, and analysts forecasts.
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CompanyPeriodAmountYieldEx-Dividend DateRecord DatePayable DateIndicator(s)
AGI
Alamos Gold
quarterly$0.02501.26%12/6/202112/7/202112/21/2021Analyst Upgrade
AMKR
Amkor Technology
quarterly$0.050.82%12/6/202112/7/202112/28/2021
BLK
BlackRock
quarterly$4.131.77%12/6/202112/7/202112/23/2021
DHF
BNY Mellon High Yield Strategies Fund
monthly$0.01907.38%12/6/202112/7/202112/21/2021
CI
Cigna
quarterly$1.001.87%12/6/202112/7/202112/22/2021
CTXS
Citrix Systems
quarterly$0.371.66%12/6/202112/7/202112/21/2021
DCI
Donaldson
quarterly$0.221.44%12/6/202112/7/202112/22/2021Earnings Report
Analyst Upgrade
Insider Selling
Analyst Revision
GBCI
Glacier Bancorp
quarterly$0.322.15%12/6/202112/7/202112/16/2021Positive News
GAIN
Gladstone Investment
$0.0912/6/202112/7/202112/15/2021
HTLD
Heartland Express
quarterly$0.020.45%12/6/202112/7/202112/17/2021
MNRO
Monro
quarterly$0.261.70%12/6/202112/7/202112/21/2021
NFE
New Fortress Energy
quarterly$0.101.33%12/6/202112/7/202112/17/2021Positive News
NAT
Nordic American Tankers
quarterly$0.013.20%12/6/202112/7/202112/21/2021
PWOD
Penns Woods Bancorp
quarterly$0.325.30%12/6/202112/7/202112/21/2021
BPOP
Popular
quarterly$0.452.14%12/6/202112/7/20211/3/2022
PBIP
Prudential Bancorp
quarterly$0.071.92%12/6/202112/7/202112/21/2021
ROST
Ross Stores
quarterly$0.28500.98%12/6/202112/7/202112/31/2021Analyst Downgrade
TSLX
Sixth Street Specialty Lending
quarterly$0.416.90%12/6/202112/7/202112/20/2021
SOI
Solaris Oilfield Infrastructure
quarterly$0.10506.34%12/6/202112/7/202112/17/2021
TLYS
Tilly's
$1.0012/6/202112/7/202112/15/2021Earnings Report
Analyst Upgrade
Analyst Revision
UNF
UniFirst
quarterly$0.300.59%12/6/202112/7/20211/4/2022
VSH
Vishay Intertechnology
quarterly$0.101.91%12/6/202112/7/202112/17/2021
WRB
W. R. Berkley
special$1.000.60%12/6/202112/7/202112/22/2021
WEBR
Weber
--$0.0412/6/202112/7/202112/17/2021Analyst Downgrade
Gap Up
AEE
Ameren
quarterly$0.552.68%12/7/202112/8/202112/31/2021
AME
AMETEK
quarterly$0.200.57%12/7/202112/8/202112/24/2021Analyst Upgrade
CXP
Columbia Property Trust
$0.844.39%12/7/202112/8/202112/8/2021Dividend Announcement
High Trading Volume
EA
Electronic Arts
quarterly$0.170.49%12/7/202112/8/202112/22/2021Analyst Upgrade
FANH
Fanhua
quarterly$0.155.20%12/7/202112/8/202112/22/2021
FAF
First American Financial
quarterly$0.512.78%12/7/202112/8/202112/15/2021Positive News
GES
Guess?
quarterly$0.22504.00%12/7/202112/8/202112/24/2021Options Volume
HOG
Harley-Davidson
quarterly$0.151.50%12/7/202112/8/202112/23/2021
HPQ
HP
quarterly$0.253.20%12/7/202112/8/20211/5/2022Insider Selling
KSS
Kohl's
quarterly$0.251.72%12/7/202112/8/202112/22/2021
PJT
PJT Partners
quarterly$0.050.30%12/7/202112/8/202112/22/2021Analyst Downgrade
TPL
Texas Pacific Land
quarterly$2.750.80%12/7/202112/8/202112/15/2021
TXRH
Texas Roadhouse
quarterly$0.401.80%12/7/202112/8/202112/23/2021
PINE
Alpine Income Property Trust
quarterly$0.275.95%12/8/202112/9/202112/30/2021Analyst Upgrade
Positive News
AAT
American Assets Trust
quarterly$0.303.14%12/8/202112/9/202112/23/2021Positive News
BSY
Bentley Systems
quarterly$0.030.23%12/8/202112/9/202112/16/2021
CNI
Canadian National Railway
quarterly$0.49771.50%12/8/202112/9/202112/30/2021
FNV
Franco-Nevada
quarterly$0.24200.68%12/8/202112/9/202112/23/2021
GLPI
Gaming and Leisure Properties
quarterly$0.675.94%12/8/202112/9/202112/23/2021Analyst Report
News Coverage
GOGL
Golden Ocean Group
quarterly$0.8524.10%12/8/202112/9/202112/16/2021Gap Down
HAL
Halliburton
quarterly$0.04500.78%12/8/202112/9/202112/22/2021
HIBB
Hibbett Sports
quarterly$0.251.39%12/8/202112/9/202112/21/2021Earnings Report
Dividend Announcement
Analyst Upgrade
INSW
International Seaways
quarterly$0.061.29%12/8/202112/9/202112/23/2021
JACK
Jack in the Box
quarterly$0.442.00%12/8/202112/9/202112/23/2021Analyst Upgrade
Insider Selling
Analyst Revision
KIM
Kimco Realty
quarterly$0.173.00%12/8/202112/9/202112/23/2021
MDU
MDU Resources Group
quarterly$0.21753.00%12/8/202112/9/20211/1/2022
MPW
Medical Properties Trust
quarterly$0.285.24%12/8/202112/9/20211/13/2022Options Volume
News Coverage
Positive News
CASH
Meta Financial Group
quarterly$0.050.30%12/8/202112/9/20211/3/2022
NEM
Newmont
quarterly$0.553.80%12/8/202112/9/202112/28/2021Analyst Report
Analyst Revision
PEG
Public Service Enterprise Group
quarterly$0.513.25%12/8/202112/9/202112/31/2021Analyst Revision
TRTN
Triton International
quarterly$0.654.40%12/8/202112/9/202112/23/2021Options Volume
AEO
American Eagle Outfitters
quarterly$0.182.50%12/9/202112/10/202112/29/2021
AUBN
Auburn National Bancorporation
quarterly$0.263.11%12/9/202112/10/202112/27/2021
ADP
Automatic Data Processing
quarterly$1.040.02%12/9/202112/10/20211/1/2022
BDX
Becton, Dickinson and
quarterly$0.871.41%12/9/202112/10/202112/31/2021Analyst Downgrade
Gap Down
BBW
Build-A-Bear Workshop
special$1.2512/9/202112/10/202112/27/2021Earnings Report
Analyst Upgrade
Buyback Announcement
Positive News
Gap Up
CNQ
Canadian Natural Resources
quarterly$0.47313.40%12/9/202112/10/20211/5/2022News Coverage
CME
CME Group
quarterly$0.901.63%12/9/202112/10/202112/28/2021Analyst Revision
CNO
CNO Financial Group
quarterly$0.132.10%12/9/202112/10/202112/24/2021
CMP
Compass Minerals International
quarterly$0.151.05%12/9/202112/10/202112/20/2021
CRWS
Crown Crafts
quarterly$0.084.10%12/9/202112/10/202112/31/2021
CTS
CTS
quarterly$0.040.40%12/9/202112/10/20211/14/2022
DVN
Devon Energy
quarterly$0.847.64%12/9/202112/10/202112/30/2021
DKS
DICK'S Sporting Goods
quarterly$0.43751.40%12/9/202112/10/202112/29/2021
FMNB
Farmers National Banc
quarterly$0.143.20%12/9/202112/10/202112/31/2021
FHN
First Horizon
quarterly$0.153.58%12/9/202112/10/20211/3/2022Analyst Report
FUSB
First US Bancshares
quarterly$0.031.03%12/9/202112/10/20211/4/2022Gap Down
FFIC
Flushing Financial
quarterly$0.213.39%12/9/202112/10/202112/31/2021
G
Genpact
quarterly$0.10800.87%12/9/202112/10/202112/22/2021
GBDC
Golub Capital BDC
quarterly$0.307.91%12/9/202112/10/202112/30/2021
HPE
Hewlett Packard Enterprise
quarterly$0.123.34%12/9/202112/10/20211/7/2022
ICFI
ICF International
quarterly$0.140.53%12/9/202112/10/20211/12/2022News Coverage
ICMB
Investcorp Credit Management BDC
quarterly$0.1510.56%12/9/202112/10/20211/4/2022
YY
JOYY
quarterly$0.513.75%12/9/202112/10/202112/23/2021
KFRC
Kforce
quarterly$0.261.50%12/9/202112/10/202112/24/2021
KMB
Kimberly-Clark
quarterly$1.143.43%12/9/202112/10/20211/4/2022
KTB
Kontoor Brands
quarterly$0.463.55%12/9/202112/10/202112/20/2021
LEA
Lear
quarterly$0.771.00%12/9/202112/10/202112/29/2021
MGM
MGM Resorts International
quarterly$0.00250.02%12/9/202112/10/202112/15/2021Analyst Report
NTRS
Northern Trust
quarterly$0.702.31%12/9/202112/10/20211/1/2022Analyst Report
Positive News
OXY
Occidental Petroleum
quarterly$0.010.12%12/9/202112/10/20211/14/2022
ORAN
Orange
semi-annual$0.33826.90%12/9/202112/10/202112/30/2021Analyst Downgrade
PPL
PPL
quarterly$0.41505.90%12/9/202112/10/20211/3/2022
RCI
Rogers Communications
quarterly$0.40593.30%12/9/202112/10/20211/4/2022Analyst Revision
News Coverage
SNDR
Schneider National
quarterly$0.071.10%12/9/202112/10/20211/10/2022
SAMG
Silvercrest Asset Management Group
quarterly$0.174.09%12/9/202112/10/202112/17/2021
SPG
Simon Property Group
quarterly$1.654.40%12/9/202112/10/202112/31/2021Analyst Revision
SITC
SITE Centers
quarterly$0.122.86%12/9/202112/10/20211/5/2022
SJI
South Jersey Industries
quarterly$0.315.04%12/9/202112/10/202112/29/2021
SPTN
SpartanNash
quarterly$0.203.13%12/9/202112/10/202112/30/2021
SR
Spire
quarterly$0.68504.40%12/9/202112/10/20211/4/2022Analyst Report
SBLK
Star Bulk Carriers
quarterly$1.2526.77%12/9/202112/10/202112/22/2021
TGNA
TEGNA
quarterly$0.09501.90%12/9/202112/10/20211/3/2022
TU
TELUS
quarterly$0.26274.30%12/9/202112/10/20211/4/2022Analyst Revision
News Coverage
TBNK
Territorial Bancorp
none$0.1012/9/202112/11/202112/23/2021Dividend Cut
TXT
Textron
quarterly$0.020.11%12/9/202112/10/20211/1/2022
GCV
The Gabelli Convertible and Income Securities Fund
quarterly$0.1710.10%12/9/202112/10/202112/17/2021
GAB
The Gabelli Equity Trust
quarterly$0.1810.16%12/9/202112/10/202112/17/2021News Coverage
GGT
The Gabelli Multimedia Trust
quarterly$0.229.30%12/9/202112/10/202112/17/2021Positive News
TRV
Travelers Companies
quarterly$0.882.30%12/9/202112/10/202112/31/2021
WMB
Williams Companies
quarterly$0.415.69%12/9/202112/10/202112/27/2021
UMBF
UMB Financial
quarterly$0.371.53%12/9/202112/10/20211/3/2022Positive News
UBCP
United Bancorp
quarterly$0.153.96%12/9/202112/10/202112/20/2021News Coverage
UVE
Universal Insurance
quarterly$0.297.48%12/9/202112/10/202112/17/2021Analyst Upgrade
UWMC
UWM
quarterly$0.105.70%12/9/202112/10/20211/6/2022Options Volume
Analyst Revision
VFC
V.F.
quarterly$0.502.70%12/9/202112/10/202112/20/2021
VGR
Vector Group
quarterly$0.205.20%12/9/202112/10/202112/20/2021Dividend Announcement
VCTR
Victory Capital
quarterly$0.171.60%12/9/202112/10/202112/27/2021
WMT
Walmart
quarterly$0.551.60%12/9/202112/10/20211/3/2022
WSBC
WesBanco
quarterly$0.333.76%12/9/202112/10/20211/3/2022
AGR
Avangrid
quarterly$0.443.49%12/10/202112/13/20211/3/2022Dividend Announcement
Analyst Revision
BAK
Braskem
annual$2.710411.60%12/10/202112/13/202112/30/2021Dividend Announcement
Analyst Downgrade
ECC
Eagle Point Credit
monthly$0.1210.50%12/10/202112/13/202112/31/2021Positive News
EVN
Eaton Vance Municipal Income Trust
monthly$0.04774.20%12/10/202112/13/202112/20/2021Dividend Announcement
Positive News
FDX
FedEx
quarterly$0.751.23%12/10/202112/13/202112/27/2021Analyst Revision
FIS
Fidelity National Information Services
quarterly$0.391.25%12/10/202112/13/202112/27/2021Analyst Report
OMAB
Grupo Aeroportuario del Centro Norte
annual$1.66683.49%12/10/202112/13/202112/21/2021Dividend Announcement
IHC
Independence
semi-annual$0.220.80%12/10/202112/13/202112/28/2021Dividend Announcement
ITT
ITT
quarterly$0.220.99%12/10/202112/13/202112/30/2021Analyst Report
JRVR
James River Group
quarterly$0.303.79%12/10/202112/13/202112/31/2021
JBT
John Bean Technologies
quarterly$0.100.26%12/10/202112/13/202112/27/2021Dividend Increase
News Coverage
BTO
John Hancock Financial Opportunities Fund
quarterly$0.555.31%12/10/202112/13/202112/31/2021Dividend Increase
News Coverage
JHS
John Hancock Income Securities Trust
quarterly$0.81035.21%12/10/202112/13/202112/31/2021Dividend Increase
Positive News
JHI
John Hancock Investors Trust
quarterly$0.36637.87%12/10/202112/13/202112/31/2021Dividend Announcement
Positive News
PDT
John Hancock Premium Dividend Fund
monthly$0.09756.84%12/10/202112/13/202112/31/2021Dividend Announcement
News Coverage
MRTN
Marten Transport
quarterly$0.041.00%12/10/202112/13/202112/27/2021Dividend Announcement
News Coverage
FIZZ
National Beverage
$3.0012/10/202112/13/20212/11/2022Upcoming Earnings
Dividend Increase
OCCI
OFS Credit
quarterly$0.5516.44%12/10/202112/13/20211/31/2022Dividend Announcement
PCM
PCM Fund
monthly$0.088.62%12/10/202112/13/20211/3/2022Dividend Announcement
PTY
PIMCO Corporate & Income Opportunity Fund
monthly$0.11888.06%12/10/202112/13/20211/3/2022Dividend Cut
PHK
PIMCO High Income Fund
monthly$0.04809.49%12/10/202112/13/20211/3/2022Dividend Announcement
RCS
PIMCO Strategic Income Fund
monthly$0.05108.96%12/10/202112/13/20211/3/2022Dividend Announcement
RMT
Royce Micro-Cap Trust
quarterly$0.24758.91%12/10/202112/13/202112/23/2021Dividend Announcement
Positive News
RVT
Royce Value Trust
quarterly$0.4810.55%12/10/202112/13/202112/23/2021Dividend Announcement
Positive News
SPR
Spirit AeroSystems
quarterly$0.010.10%12/10/202112/13/20211/3/2022
FUND
Sprott Focus Trust
quarterly$0.41078.80%12/10/202112/13/202112/23/2021Dividend Increase
Positive News
GROW
U.S. Global Investors
monthly$0.00751.50%12/10/202112/13/202112/27/2021Upcoming Earnings
ZTR
Virtus Total Return Fund
monthly$0.0810.23%12/10/202112/13/202112/20/2021
 
What is the Ex-Dividend Date in Investing?

There are many benefits to investing in dividend-paying companies, not the least of which is that dividends will usually increase over time. Dividends can provide a hedge against the inherent risk in the market because they offer at least a partial return on an investment. And while there are no guarantees in the market, once a company starts to issue a dividend, they typically work very hard to continue to offer one – and increase it if possible. In fact, the elite group of companies known as “dividend aristocrats” have achieved this status by increasing their dividend payouts for more than 25 consecutive years. The average compounded annual growth rate for dividends of S&P 500 companies is 3.2%.

For many investors, collecting their dividend is something they don’t even think about. They may have owned the stock for years and are accustomed to receiving their dividend check on a regular basis. Other investors have a dividend reinvestment plan (DRIP) that allows them to simply reinvest the dividends to buy more shares in the company. DRIPs are a set-it-and-forget-it strategy that can help a portfolio grow.

However, even the most committed buy-and-hold investor confronts times when they have to realistically assess their portfolio, and they may decide there’s a need to sell one dividend stock and add another. For these investors, it may be important to know when the stock is selling ex-dividend.

This article will define ex-dividend, the process and additional dates that are important for investors to be aware of. We’ll also dive into a rarely used trading strategy called dividend capture and why it’s not realistic for the average investor.

What is ex-dividend?

Ex-dividend literally means “without the dividend”. When a stock sells ex-dividend it is said to be trading without the dividend added to its stock price. A simple example can help explain this.

Company A’s stock is selling for $150 per share, and they announce a 3% dividend. On the ex-dividend date (see below), at the opening of trading, Company A’s stock will be marked down by 3% ($4.50). Any investor buying stock will be purchasing it at the discounted price, $145.50, but they will not be able to receive the upcoming dividend if they were not already a shareholder.

What is the ex-dividend date?

The ex-dividend date is the first day a stock will be trading “ex-dividend”. It is automatically established by the market once the company announces a date of record for their dividend. Typical ex-dividend dates are set two business days before the record date.

Other key terms that can help explain ex-dividend

There are four key dates that are part of the dividend issuing process.

Record Date– this is the date set by a company’s board of directors once they decide to issue a dividend. An investor must be on the company’s record as a shareholder on this date to receive the dividend. Currently, the record date is set for one day after the ex-dividend date.

Ex-Dividend Date– once the record date is set the stock market will automatically set the ex-dividend date. As mentioned above, this date will typically be two days before the record date.

Declaration Date– this is simply the day the company announces to the public that they are issuing a dividend. In this announcement, the company will list how much the dividend will be, the ex-dividend date and the payment date. Chronologically, this would occur after the record and ex-dividend date have been set.

Payment Date– this is the date when the dividend payments are distributed to shareholders. This is typically at least two weeks after the record date.

Let’s look at an example of how all this might work together.

On August 16, 2018, Tiffany & Co. (NYSE: TIF) declared a dividend of $0.55/share (the declaration date) to be paid on October 10 (the payment date). The ex-dividend date was set for September 19, 2018, making the record date September 20, 2018.

Why is the ex-dividend date different from the record date?

Although many stock transactions seem to be handled almost instantaneously, most trades take two days to “settle”. This settlement time can cause a delay between an investor being listed as “on the record” to receive a dividend. For this reason, the stock market requires an ex-dividend date to be set. This date will typically be two business days before the record date.

Is the ex-dividend date a firm date?

Yes. Investors need to have their shares purchased and be listed as shareholders of record BEFORE the ex-dividend date. So in our example above, investors had to own shares in Tiffany & Co. on or before September 18 to receive the dividend. After this date, the shares will sell at a price that reflects the dividend already being issued.

Can an investor sell shares after the ex-dividend date but before the payment date and still receive the dividend?

Yes, as long as they are a shareholder of record on the ex-dividend date, they will receive the dividend. There is a practice known as dividend capture which we will explain more below.

How can investors find ex-dividend dates?

Companies are proud of their ability to issue a dividend and will typically have this information available to shareholders and prospective investors on their website, probably in an area called "Investor Relations" or something similar. In addition, many financial websites will have ex-dividend calendars that will provide a list of all announced ex-dividend dates. This is an easy way for investors to see not only the ex-dividend date of a company they may be interested in buying but a comparison of dividend amounts for similar companies. Once the ex-dividend date arrives you'll see an X next to the stock symbol to indicate that it is trading ex-dividend.

What is dividend capture?

For most investors, dividend investing is a straightforward, conservative investment strategy. However,
when turned into an aggressive trading strategy it carries both above-average risks and possible tax consequences. Dividend capture seeks to take advantage of the fact that stocks do not always trade precisely according to a formula or by conventional logic. Dividend stocks are a great example of this. On the ex-dividend day, the stock will start trading at the discounted price, but it will typically not maintain that adjusted price, meaning it could go higher or lower. And although investors usually factor in the anticipated decline in price as the ex-dividend day draws closer, many stocks have been known to go through a period of heightened interest prior to the ex-dividend date as more investors seek to get the dividend.

So for example, let’s say a stock was selling for $100 and announced a $0.50 dividend. On the ex-dividend date, the stock’s price would drop by $0.50, but if a significant amount of investors bought shares of the stock, the stock’s price could have been driven up to $102. So even with the discount factored out of the stock price, it is still trading above where it was on the declaration date.

These market anomalies can make it difficult to make dividend capture a profitable strategy, but here’s where it can sometimes, and the emphasis is on the word sometimes, work. There are times when a stock, for any number of reasons, may not be marked down to the expected amount dictated on the declaration date. In our example above let’s say the stock that was expected to drop by $0.50 only dropped by $0.25. An investor could go through the following process:

  1. Buy the stock prior to the ex-dividend date for $100
  2. Sell it on the ex-dividend date for $99.75
  3. They collect the dividend of $0.50 on the payment date
  4. They realize a total return of $0.25/share. They lost $0.25 on the stock but gained $0.50 on the dividend distribution.

In theory, this is true, but realistically it would require a much higher spread between the expected ex-dividend price and the actual ex-dividend price to make this a profitable trade. This is for two reasons. The first one is taxes. Qualified dividends receive preferential tax treatment. However, that's only if the stock is owned for more than 61 days. In our example, the stock was not so it gets no such treatment. The second issue has to do with trading costs. In many cases, it’s going to cost an investor more than $0.25/share to execute a trade and they’re paying that cost on both ends, you can see why what looks on paper to be a profitable trend could easily be a losing trade.

A better approach for investors looking to profit from dividend capture would be to use either fundamental analysis or technical analysis to predict which stocks may be more likely to trade higher prior to their ex-dividend date. By purchasing the stock well in advance of the ex-dividend date (preferably more than 61 days for tax purposes); investors could turn a profitable trade by selling the stock on or before the ex-dividend date.

Can average investors profit from dividend capture?

The simple answer here is no and for many reasons. First, although the example above could in fact work, the market tends to ensure that “loopholes” like this quickly close. Secondly, as we mentioned above there are commission charges that apply on both ends of the trade, even if the trade is a losing trade. But most importantly, there is an enormous amount of time and research that would have to go into finding not only the right candidates for such a trade, but then the knowledge, discipline, and meticulous execution that is necessary to make the trade work. For most investors, even those involved in day trading, the reward is not worth the effort, let alone the risk.

The bottom line on ex-dividend

Despite the presumption that dividend investing can be boring and conservative, savvy investors frequently buy dividend stocks as part of their portfolio because of the benefits that come from receiving regular dividends. Among these is the benefit that comes from reinvesting dividends to buy more shares which allows compounding to take place. However, if the time comes for an investor to rebalance their portfolio, they may find that they have to swap out one dividend stock for another.

When this happens, they’ll need to know the ex-dividend date for the stock they wish to purchase. By purchasing the stock before the ex-dividend date, they will be considered a shareholder of record by the record date and receive the scheduled dividend. The ex-dividend date is a firm date and once the date arrives, any new investors that buy the stock will not receive the upcoming dividend. Plus, once the ex-dividend date arrives, the stock price of the company will be adjusted downward typically for the same amount as the dividend, although there are times when it is different.

Investors that are wondering when a company is issuing a dividend can usually find this information on a company's website or other financial sites. Dividend-issuing companies are usually very proud of this fact and make the information readily available to investors.

 


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