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SPECIAL SUBJECT: What are the ex-dividend date and the record date?

Posted: 23-11-2018

Ex-dividend date


It is the transaction day that investors buy securities will not enjoy the rights of shareholders such as the right to receive dividends, the right to buy additionally issued stocks, the right to attend the General Meeting of Shareholders,...
For example: The ex-dividend date is the day when you buy the stock on or after that date, you will not be entitled to dividends for that payment. On the ex-dividend date, the stock price will fall to a range corresponding to the paid dividend value. And those who are entitled to dividends will be compensated by the dividend in the announced dividend payment period.


The record date or the closing date


It is the date the issuer makes a list of securities holders with the aim to exercise rights for shareholders. At the closing date, if the investors named in the list of securities holder, they will receive their rights, such as the right to receive dividends, the right to buy additionally issued stocks, ...


According to the latest regulations from January 01st, 2016, the payment time is 16:30 pm on T + 2. It means that, after this time, you already own the stock (but on T + 3 you can actually sell it because when the stock arrives, the session is over), excluding Saturday, Sunday and public holidays. In which, the transaction day is considered as T + 0, the next working day is T + 1,...
Specifically: November 30th, 2018 (Friday) is the ex-dividend date, December 03rd, 2018 (Monday) is the record date, if you buy stocks before November 30th, 2018 or on December 03rd, 2018, all shareholders named in the shareholder registration book will still enjoy the rights.


The ex-dividend date and the record date


Thursday (November 29th, 2018)

Friday (November 30th, 2018)

Monday (December 03rd, 2018)

Today you buy a new one, you still enjoy the right

The ex-dividend date

The record date, closing date of shareholders list.
You must own the stock until the end of this day to receive the rights


Thus, investors who buy securities before the ex-dividend date (November 30th, 2018) and hold until the end of the record date (December 03rd, 2018) will be named in the list of entitlements. Moreover, if they buy on the ex-dividend date (November 30th, 2018) or after the ex-dividend date, the investors will not be named in the list of entitlements.
 

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