Ex-Dividend, Record and Payment Dates
To receive a dividend you must own the shares before the ex-dividend date; buying on or after it means the seller gets the payment. The record date is when the company checks its list of shareholders, and the payment date is when the cash arrives.
Every dividend comes with a set of dates, and one of them decides who gets paid. Buy a day too late and the dividend goes to the seller; sell a day too early and you lose it. The dates also matter for traders, because the share price usually drops on the ex-dividend date, and short sellers and option holders are affected too. This entry walks through the four dates in order and what each means for you.
- Category
- Fundamentals and Macroeconomics
- Reading time
- 4 min
- Also called
- Ex-dividend date, Ex-date, Record date
- Updated
The dividend dates in plain words
When a company declares a dividend, it sets a record date: you must be on its books as a shareholder that day to be paid. The ex-dividend date is the cut-off for buyers.1 See Dividend.
For shares, the ex-dividend date is usually the same day as the record date — or one business day earlier if the record date is not a business day. Buy on or after the ex-date and the seller gets the dividend.1
The four dates, in order
Declaration date
The company announces the dividend amount, record date and payment date. Companies that pay dividends usually do so on a fixed schedule.2
Ex-dividend date
From this day, new buyers do not receive the dividend. Own the shares before it.
Record date
The company identifies the shareholders entitled to the payment.
Payment date
The cash is paid to those shareholders.
Check your broker
Dividends usually arrive automatically; check timing and taxes. See Broker.
Plan trades around it
Remember the price adjusts on the ex-date.
Worked examples
Example 1 — Who gets paid
EntitledA company declares a dividend with record date Monday 16 March and ex-date Monday 16 March. You buy on Friday 13 March; another investor buys on 16 March.
| Your purchase (before the ex-date) | You receive the dividend |
| Purchase on the ex-date | The seller receives it |
The ex-date is the line: buy before it to be paid.
Example 2 — Record date on a weekend
WeekendThe record date falls on a Sunday.
| Ex-dividend date | The preceding Friday |
When the record date is not a business day, the ex-date moves to the business day before it.
Example 3 — The price drop
AdjustmentA stock closes at $50.00; the next day it goes ex-dividend for $0.80.
| Expected opening price | ≈ $49.20 |
| Dividend to holders | $0.80 |
Buying the day before the ex-date for the dividend gains nothing on its own; the price adjusts.
What each date decides
| Aspect | Set by | Matters for |
|---|---|---|
| Declaration date | Company | Knowing the amount and schedule |
| Ex-dividend date | Exchange rules, based on the record date | Buyers and sellers |
| Record date | Company | Who is on the books |
| Payment date | Company | When cash arrives |
Why traders track these dates
Income planning
Knowing when payments arrive. See Dividend Yield.
Short positions
Shorts over the ex-date owe the dividend. See Short Selling.
Options
Dividends affect option prices and early exercise. See Options.
Price gaps
Ex-date drops are not signals. See Price Gap.
Advantages and disadvantages
Advantages
- Clear, published dates.
- Easy to plan purchases and sales around.
- Explains predictable ex-date price moves.
Disadvantages
- Easy to confuse ex-date and record date.
- Ex-date drops can trigger stop orders.
- Rules differ for some other securities and markets.
Going deeper
Read as far as you need. Each level builds on the one before it.
The ex-date is the one to watch
Beginner
For buyers and sellers, the ex-dividend date is the practical cut-off. The record date is the company’s bookkeeping date.
Stops and the ex-date
Intermediate
A large dividend makes the price open lower on the ex-date, which can trigger nearby sell stops even though nothing changed in the business. See Stop Loss.
Settlement and the ex-date
Advanced
The ex-date is tied to how long trades take to settle, which is why exchange rules set it relative to the record date. See Settlement.
Common mistakes
Buying on the ex-date for the dividend
You must buy before it.
Confusing record and ex-dates
Watch the ex-date when trading.
Reading the ex-date drop as weakness
It is the dividend leaving the price.
Forgetting shorts owe the dividend
Include it in the cost of the short.
Check your understanding
Test yourself before moving on. Each answer comes with an explanation.
Key points to remember
- Own the shares before the ex-dividend date to be paid.
- The ex-date is usually the record date, or the business day before it.
- The record date is when the company checks its shareholders.
- The price usually drops by about the dividend on the ex-date.
- Shorts over the ex-date owe the dividend.
Frequently asked questions
Can I sell on the ex-date and still get the dividend?
When will I actually receive the money?
Why did my stock gap down on a quiet day?
Further learning
- Dividend
How dividends work overall.
- Dividend Yield
Dividends relative to price.
- Short Selling
Why shorts pay dividends.
- Settlement
Why the ex-date is set where it is.
Sources
This article is written in our own words. The sources below support the specific facts, rules and figures marked with a number in the text. Links open the original publisher’s page.
- Investor.gov (SEC). Ex-Dividend Dates: When Are You Entitled to Stock and Cash Dividends (opens in a new tab) Checked .
- Investor.gov (SEC). Dividend (glossary) (opens in a new tab) Checked .
Educational content, not financial advice. Examples use hypothetical prices and simplified costs; actual fees, margin rules and regulations vary by broker, market and country. We are not affiliated with any publisher linked above. Last reviewed . Report an error or request a source credit.