Dividends and buybacks

Ex-Dividend Date

The date from which a share no longer comes with the next dividend. To receive the dividend, you need to own the share before this date.

Why does it matter?

It decides who gets paid, and the share price usually drops by about the amount of the dividend on this date.

How do I read it?

That drop isn't a loss for shareholders: the cash simply moves from the company to them. The payment itself usually arrives days or weeks later.

Example

A company will pay $1 per share, and its ex-dividend date is a Friday. Buy on Thursday and you receive the $1; buy on Friday and the seller receives it. On Friday, the share price usually starts the day about $1 lower.