If on January 3, 2014, a company declares a dividend of $1.50 per share, payable on January 31, 2014, to holders of record on January 17, then the price of the stock should drop by approximately $1.50 on January 15, which is the ex- dividend date.

Question

Quizplus · Accepted Answer

The ex-dividend date is typically set one business day before the record date, so the stock price usually drops by the dividend amount on the ex-dividend date, which would be January 15 in this case.

If on January 3, 2014, a Company Declares a Dividend