What is the “ex-dividend” date?

(excerpted from The Benefits of Stock Dividends, published June 2, 2011 at www.GoodfellowLLC.com)


“What else do I need to know about dividends?” Well, some stocks only pay their dividends once or twice per year, like DeVry Inc. Also, pay attention to the ex-dividend dateIn order to earn the next dividend, you need to own the stock by the ex-dividend date. For example, Kimberley-Clark’s (KMB) next ex-dividend date is June 8, 2011. A person would need to purchase the shares by June 7, 2011 in order to earn that dividend.  Companies generally pay their dividend a few weeks after the ex-dividend date. But even short-term traders can earn dividends. A person who buys KMB shares on June 7, 2011, and then sells them a week later, will still receive the dividend, even though they no longer own the stock, because they owned the stock on the ex-dividend date!


Goodfellow LLC is a subscription-only stock market website. We strive to identify financially healthy companies in which traders and investors can buy shares and earn dividends and capital gains. See disclaimer for the risks associated with investing in the stock market. See your tax advisor for the tax consequences of investing. See your estate planning attorney to clarify beneficiary and inheritance issues associated with your assets.


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