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Most of the people who are connected with financial world knows well about dividend and stocks. They also know about dividend dates like ex dividend date etc. too but probably very few will be aware of that ex dividend date plays an important role in stocks market investment and one can take benefit of this. In India and some other countries which have similar trading systems like UK, Australia and New Zealand ex dividend dates play a vital role for investors. To better understand this, let’s take an example of a company ABC. Suppose ABC has declared ex dividend date as 1 Nov 2013(Friday) and Record Date for this company for the purpose of dividend is 3 Nov 2013 considering the Saturday and Sunday as non-trading days in NSE and BSE. Suppose dividend paid on each share or stock by company is 100. Now it should be clear to everyone that ex dividend dates was created to clear all the pending dividend transactions by the company. Now the Key part is that if you wish to get dividend on the stocks you own, you have to own the stocks before it reaches to its ex dividend date. If you do not own any dividend paying stocks in India till its ex dividend date, in that case you won’t be eligible for any dividend attached with stocks you have purchased so ultimately what comes as a conclusion that you should search that kind of Indian stocks in Indian stock market which are 7 to 10 days apart from their ex dividend date in India. More importantly keep in mind too that if an investor purchase a dividend stock on its ex dividend date, in that case he will not be getting dividends from that stock as stocks or shares will be credited to his account after 2 business days. Key for this is always buy a dividend paying stock in India prior to its ex dividend date. This also states clearly that a stock market investor can sell their shares on ex dividend date and still will be eligible to receive dividends from the stocks he would sell because those stocks will be credited to his account till two next days, afterwards they will be transferred to their new buyer. Many People adopt this strategy to earn more income in a short time span and this has proved a beneficial strategy for them also. There is one important thing also and that is on ex dividend date stock prices of company falls upto the margin of the dividend price on per share. Means to say if share was trading on 455 before ex dividend date. It will be on 355 considering the 100 Rs. Dividend on each share. Author Bio: Author has been writing articles on Indian dividend stocks. this article was primarily based on impact of dividend dates on Indian dividend stocks.
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