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Strategies & Market Trends : Dividend investing for retirement -- Ignore unavailable to you. Want to Upgrade?

To: Steve Felix who wrote (3586)	2/1/2010 9:22:24 PM
From: Grommit	1 Recommendation Read Replies (2) \| Respond to of 34328

Ex div issues. Felix: "Most times I would rather buy on the ex-dividend date when the stock price falls. I figure I invest fewer $$ for a smidgeon higher yield. Just my preference." Me: Do the math and you will see that it makes no difference. Finance 101. answers.google.com Felix: 10/29 was the last day to buy INTC before the last dividend. Close 19.22. Nov 4th exdividend close 18.59 on a .16 dividend. So you could have one share of stock at $18.59 or One share of stock at $19.22 and .16 in your account. $19.06 for the stock after dividend. Lots of stocks go down more than their dividend. Stock market 101? me: you cannot look at what happened in one particular case. another example can go the other way. the link that i gave you had it right. of course, normal market movement can mask the drop. from the link: ...The price drops because the owner of a share before the ex-dividend date gets a dividend and the owner of a share after the ex-dividend date doesn't, and the stock is worth more with the expectation of the dividend than without it. me again: A stock really is worth less ex-div but (I repeat) normal (and non-normal) price movements can mask the theoretical price drop. And it is harder to see with low volume stocks with large bid/ask spreads. You cannot make money buying pre div and selling ex div. If you could, arbitrage would minimize the possibilities to essentially zero. IMO, if you want to own a stock, just buy it and do not worry about the ex date. If you make or lose money by waiting for after the ex date, it is random (unpredictable) movement. I do not want to argue, and I do not care to educate anymore. The board is devoted to a good concept, but the blind are leading the blind on many topics and basic concepts. good luck, grommit FYI: en.wikipedia.org ..Usually the stock's price will drop by the amount of the dividend on the ex-dividend day (ceteris paribus) since that much wealth has already been transferred by the company to its owners. Ceteris paribus is a Latin phrase, literally translated as "with other things the same," or "all other things being equal or held constant."