If on January 3, 2012, a company declares a dividend of $1.50 per share, payable on January 31, 2012, then the price of the stock should drop by approximate $1.50 on January 31.

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Quizplus · Accepted Answer

The price of the stock may drop by approximately the same amount as the dividend, but it is not guaranteed. The price drop will depend on various factors such as overall market conditions, investor sentiment towards the company, and future earnings prospects.

If on January 3, 2012, a Company Declares a Dividend