In order to receive the dividend on a common stock, an investor must purchase the stock prior to its ex-dividend date.

Question

Quizplus · Accepted Answer

This is because on the ex-dividend date, the stock price is adjusted downward by the amount of the dividend in order to reflect the fact that new buyers will not receive the upcoming dividend payment. Therefore, only those who own the stock prior to the ex-dividend date are entitled to the dividend payment.

In Order to Receive the Dividend on a Common Stock