![]() In theory, the price of the security should fall by the amount of the dividend on the ex-dividend date, as those investors will not receive the payment. The security can then be sold on the ex-dividend or after, and the investor will still receive the dividend on the pay date. The basis of the entire dividend capture strategy is that the stock must be purchased before this date, or the dividend will not be paid to that investor. Of these dates, the most important to those using the dividend capture strategy is the ex-dividend date. Pay date is the day that shareholders receive their dividends.Date of record is the day that the company records the shareholders that are eligible to receive the dividend.The dividend to be paid is also reflected in the share price as it is accordingly reduced by the amount of the dividend on this date. Investors need to own the stock prior to this date to be entitled to the next dividend payment. The ex-dividend is the date that the stock trades without the dividend being paid.The other dates important to the dividend and the amount paid are also stated. The declaration date is the date that the board of directors announces that a dividend will be paid.Most investors are already familiar with these dates, but a quick review can be helpful in the discussion of the dividend capture strategy. The first item that investors interested in the dividend capture strategy need to know is that this investment philosophy centers around the dates associated with the dividend, including the declaration date, the ex-dividend date, the date of record, and the pay date. This article will examine the dividend capture strategy, the advantages, and risks of the strategy, and provide a few examples of stocks that could be a good way for the investor to utilize this strategy. While we typically follow a long-term investment strategy, we believe it is important to consider various other paths that can lead to financial freedom. Owning stocks of this type for long periods of time while reinvesting the dividends to acquire more shares is our preferred way to acquire wealth.+ Dividend growth during economic expansions is one thing, but raising payments during a downturn is a sign of a company that has goods or services that customers need even in a recession. The Dividend Aristocrats have successfully navigated multiple recessions while growing their dividends at the same time. ![]() Click here to instantly download your free spreadsheet of all 65 Dividend Aristocrats now, along with important investing metrics.
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