Dividend is one of the key components for most income and value investors, it plays a major part in the compounding effect if we were to re-invest the dividend. Personally, when I choose a stock to invest, dividend yield is definitely one of the key consideration.
When comes to dividend stocks, there are a few key dates that we absolutely need to get familiarized with i.e. CD (Cum-Dividend Date), XD (Ex-Dividend Date) and Payment Date. Today, I would like to talk a little bit about XD (Exclude-Dividend Date).
When a stock is trading at XD (usually 2 days), it means that any purchase during these 2 days will NOT be entitled to the upcoming Dividend payout. On the first day of XD, the stock price is adjusted downwards (by the Exchange) with the equal amount of the dividend to be paid. For example :
On 04/05/2015, Stock ......