When you are like me, a starting Dividend Growth Investor, it is important to remember a few dates. And I know we all have to remember a lot of different dates such as birthdays, anniversaries, etc. But as a DGI you need to know at least three more (per stock).
And the experienced DGI’s, who are reading this blog post, know about which dates I’m referring to. And the might think, o no, there we go again. But because these dates Are so important, I thought about writing a blog post about it.
So if you are a pro stop reading here and look at one of my analysis for example. If not read on. So here I go
Good and thank you for taking the time to read my latest blog post.
Before buying stocks enthusiastically, which are on top of your (or anyone’s) watch list, it is important to know a few very important dates. Because if you buy a stock before or after a specific date, it can make a huge difference. It is possible that you miss out on the dividend because you bought to late. Therefor here are the three important dates:
Dvidend declaration date
The date of declaration is when the board of directors of a company announces their intention to pay dividend. Normally this is done through a press release. These can be found on the company’s website and on all major news and financial websites. For example on Yahoo Finance or Google Finance.
Besides the height of the dividend, it also announces the date of record and date of payment. Yes I know, these are the two other important dates. So keep an eye open for these kind of press releases or look up these dates on the internet.
Ex-dividend date or record date
The ex-dividend date is a very important one. If you own the stock before this date you are entitled to the dividend. On this date the stock price normally declines because the stock trades without the right to the dividend and the value of the company decreases because the dividend no longer belongs to the company.
When you buy a stock on the Ex dividend date, then sorry folks, you are not getting any of the good stuff. No dividend for you this time.
The record date is two days after the ex-dividend date. On this day you should be on the record (at the company) as a shareholder. The company keeps a record of all their shareholders. Your stockbroker takes care of this. So no worries, you can forget about this date.
This is the big day. This is the day the company pays you the dividend and the cash will be on your account, ready to re-invest.
So here you have it, the three important dates to remember.
After reading this blog post you might be wondering why I wrote this blogpost? As you can read on my About-page, I have been investing for a long time. So this is not new to me.
I bought AT&T in the beginning of august. After my analysis I logged in to my stockbroker account and gave a buy order for AT&T. I knew AT&T had an ex-dividend date in august and I was pretty sure (at that time) I was on time with my buy order.
You can guess it by now… Yes I bought AT&T exactly on the ex-dividend date. Ouch… So no dividend for me in august.
A lesson learned (the hard way). Next time I will be more precise and I will look up the ex-dividend date before I will give my order.
Always keep learning and look back on your actions!