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Earliest to dispose stocks and still entitled to dividends
Posted: Tue, 29 Apr 2025 11:49 am
by abbby
Anyone has the answer?
Seems everywhere it's a different answer..
Can you dispose on the day of ex-dividend date and still be entitled to dividends? Referring to SG stocks.
Re: Earliest to dispose stocks and still entitled to dividends
Posted: Tue, 29 Apr 2025 9:01 pm
by Wd40
The way it works is; the dividend is actually part of the stock.
So lets say stock price is $10 and dividend announced is $1.
In a perfect world; on the day the stock trades ex dividend, the price falls to $9.
So the effect is the same. If you sell the stock before ex dividend date you sell it at $10 and you get no dividend.
If you sell the stock after ex dividend, you sell it at $9 and you get $1 as dividend.
But the world is not perfect, so on the ex dividend date the stock may trade at $9.2 or $8.8 or anything around that.
Basically there is no free lunch, if that is what you are asking.
Re: Earliest to dispose stocks and still entitled to dividends
Posted: Wed, 30 Apr 2025 8:33 am
by abbby
Yes that answers it, thanks! Thats what I realised too..ex-dividend date the stock prices always drop to the rate of the dividend %.