written by reader X Dividend question

By stevemack70, August 22, 2014

I was under the impression you receive a dividend on shares you hold as of the XD date. Last year I owned 100 shares of STON and on anticipation of the dividend I bought 10 more shares after the XD date. When the dividend was paid they paid on 110 shares. Was this their mistake or is the rule that you just have to be a shareholder at the XD date and any shares you have at the pay date will be paid?

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Travis Johnson, Stock Gumshoe
August 22, 2014 9:44 am

ex-dividend means “without the dividend”, so the ex-div date is the date at which the stock starts trading without the rights to the upcoming dividend (if you sell it on that day, you should still get the dividend — if you buy it on that day, you don’t — the stock trades without passing the dividend rights from seller to buyer as of that day). I presume that either they made a mistake or you got the wrong ex-div date from somewhere or they were forced to change the ex-div date.

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