Does a stock really dip in price on the ex-dividend date? And why would it do this?
"The stock should fall by approximately the amount of the dividend as that is what is paid out. If you have a stock trading at $10/share and it pays a $1/share dividend, the price should drop to $9 as what was trading before the dividend was paid would be both the dividend and the stock itself. If the person bought just for the dividend then it would likely be neutral as there isn't anything extra to be gained. Consider if this wasn't the case. Wouldn't one be able to buy a stock a few days before the dividend and sell just after for a nice profit? That doesn't make sense and is the reason for the drop in price. Similarly, if a stock has a split or spin-off there may be changes in the price to reflect that adjustment in value of the company. If I give you 2 nickels for a dime, the overall value is still 10 cents though this would be 2 coins instead of one. Some charts may show a ""Dividend adjusted"" price to factor out these transactions so be careful of what prices are quoted." Suppose the price didn't drop on the ex-dividend date. Then people wanting to make a quick return on their money would buy shares the day before, collect the dividend, and then sell them on the ex-dividend date. But all those people trying to buy on the day before would push the price up, and they would push the price down trying to sell on the date. The stock price is what people think a company is worth, this is made up of When a company pays out a dividend the money in the company’s bank account reduces, therefore the value of the company reduces.    When a company says they are going to pay a larger dividend than expected, we start to expect they are going to make more profit next year as well. So stock price tends to go up when a company says it is increasing the dividend, but down on the day then money leaves the companies bank account.   There is normally many months between the two events. "This effect has much empirical evidence as googling ""dividend price effect evidence"" will show. As the financial economic schools of thought run the gamut so do the theories.  One school goes as far to call it a market inefficiency since the earning power thus the value of an equity that's affected is no different or at least not riskier by the percentage of market capitalization paid. Most papers offer that by the efficient market hypothesis and arbitrage theory, the value of an equity is known by the market at any point in time given by its price, so if an equity pays a dividend, the adjusted price would be efficient since the holder receives no excess of the price instantly before payment as after including the dividend since that dividend information was already discounted so would otherwise produce an arbitrage."
Originally, stocks were ownership in a company just like any other business- you expected to make a profit from your investment, which is what we call dividends to stock holders. Since these dividends had real value, the stock price was based on what this return rate was, factoring in what it might be expected to be in the future, etc.  Nowdays many companies never issue any dividends, so you have to consider the full value of the company and what benefit could be gained by another company if it were to acquire it. the market will likely adjust the share price to factor in what the value of the company might be to an acquirer.  But otherwise, some companies today trading at an astronimical price, and which nevers pays a dividend- chalk it up to market stupidity. In this investor'd mind, there is no logical reason for these prices, except based on the idea that someone else might pay you more for it later... for what reason? I can't figure it out. Take it back to it's roots and imagine pitching a new business idea to you uncle to invest in- it will make almost nothing compared to it's share price, and even what it does make it won't pay anything to him for his investment. Why wouldn't he just laugh at you? The market is not stupid. It realises that a company is worth less after paying out dividends than before paying them. (It's obvious, since that company has just given out part of its earnings.) So after a company pays out dividends, its stock price normally drops approximately by the amount paid. Therefore if you buy, get the dividend, and immediately sell, under normal conditions you won't make any profit. I've never seen a dividend, split or other corporate action during the day, but I have seen trade suspended a few times when something big happened. The market opening price is not in general the same as the close of the previous day. It can gap up or down and does frequently. I don't know of an api to find out if the dividend was cash or stock, but stock dividends are a lot less common. Your understanding is incorrect.  The date of record is when you have to own the stock by.  The ex-dividend date is calculated so that transaction before that date settles in time to get you listed as owner by the date of record. If you buy the stock before the ex-dividend date, you get the dividend.  If you buy it on or after the ex-dividend date, the seller gets the dividend. Adjustments can be for splits as well as for dividends.  From Investopedia.com: Historical prices stored on some public websites, such as Yahoo!   Finance, also adjust the past prices of the stock downward by the   dividend amount. Thus, that could also be a possible factor in looking at the old prices. The ex-dividend date is the first date on which you may sell without losing your dividend.  In this case that date is August 5th (thanks, Victor).  The price opens on the ex-dividend date lower than it closed on the previous day (by the amount of the dividend). Therefore you may sell any time on August 5th (including during pre-market trading) and still get the dividend. You must be the owner of the stock as of the end of after-hours trading on the 4th (and therefore overnight) in order to get the dividend. Intel's Dividend Dates The record date isn't important to your trading decision. Two reasons why I think that's irrelevant: First, if it was on 3/31/2012 (two other sources say it was actually 4/3/2012), why the big jump two trading days later? Second, the stock popped up from $3.10 to $4.11, then over the next several trading days fell right back to $3.12. If this were about the intrinsic value of the company, I'd expect the stock to retain some value. Do you realise that the examples you have given are for stock splits not for dividends, that is why the date payable is before the ex-date for the split. The payments for the split occur on 30th June and the first day the stock trades with the new split is on the next trading day, being the ex-date, 1st July. Here's what Investopedia says about payouts for ex-dividend stocks: A stock trades ex-dividend on or after the ex-dividend date (ex-date). At this point, the person who owns the security on the ex-dividend date will be awarded the payment, regardless of who currently holds the stock. After the ex-date has been declared, the stock will usually drop in price by the amount of the expected dividend. Read more: Ex-Dividend Definition | Investopedia http://www.investopedia.com/terms/e/ex-dividend.asp#ixzz4Nl4J3s4k  I hope this helps. Good luck! Yes, somebody could buy the shares, receive the dividend, and then sell the shares back. However, the price he would get when he sells the shares back is, ignoring other reasons for the price to change, exactly the amount he paid minus the dividend. Your question is missing information. The most probable reason is that the company made a split or a dividend paid in stock and that you might be confusing your historical price (which is relevant for tax purposes) with your actual market price. It is VERY important to understand this concepts before trading stocks. You will need to buy a stock before the ex-dividend date to receive the dividends. You can sell a stock on the ex-dividend date or after and you will receive the dividends. So if the ex-dividend date is the 5th August, you need to buy before the 5th and you can sell on the 5th or after, to receive the dividends. Definitions from the ASX: Record date The Record Date is 5.00pm on the date a company closes its share   register to determine which shareholders are entitled to receive   the current dividend.  It is the date where all changes to   registration details must be finalised.   Ex dividend date The ex dividend date occurs two business days before the company's   Record Date. To be entitled to a dividend a shareholder must have   purchased the shares before the ex dividend date. If you purchase   shares on or after that date, the previous owner of the shares (and   not you) is entitled to the dividend. A company's share price may move up as the ex dividend date approaches   and then fall after the ex dividend date. The dividend is for a quarter of the year, three months. 80 cents is 3.9% of $20.51. Presumably the Div/yield changes as the stock price changes. On Yahoo, they specify that the yield is based on a particular stated date. So it's only the exact number if the stock trades at the price on that date. "The ex indicator is meant to be a help for market participants.  On the ex-day orders will go into a different order book, the ex order book, which at the start of the ex day will be totally empty, i.e. no orders from the non-ex day book have been copied over. Why does this help?  Well imagine you had a long-standing buy order in the book, well below the current price, and now the share price halves due to a 2-for-1 split, would you want to see your order executed? If so, your order should have gone into the ex-book which is only active on the ex-day (and orders in the ex book are usually copied over to the normal book on the day after the ex-day but this is exchange-specific). Think of it as an additional safety net to tell the exchange: ""I know what I'm doing: I want to buy this stock totally overpriced after the 2-for-1 split"". Now some exchanges and/or some securities (mostly derivatives) linked with the security in question don't have this notion of ex or the ex-book, and they will tell you by ""will not be quoted ex"" or ""the ex indicator is missing"". In your case (SNE) it is a sponsored ADR, the ex-date was Mar 28 2016, one day before the ex date of the Japanese original.  According to my understanding of NYSE rules, there is no specific rule for or against omitting the ex-indicator.  It seems to be a decision on a case by case basis.  Looking through the dividends of other Japanese ADRs I drew the conclusion none of them have an ex-book and so all of them are announced as: ""Will not be quoted ex by the exchange"".  Again, this is based on my observations." When dividend is announced the stock and option price may react to that news, but the actual payout of the dividend on the ex-dividend date is what you probably are referring to. The dividend payout affects the stock price on the ex-dividend date as the stock price will drop by the amount of paid out dividend (not taking into account other factors). This in turn drives the prices of all options.  The amount of change in the option price for this event is not only dependent the dividend payout, but also on how far these are in our out of the money and what there time to expiration is. The price of a call option that is far out of the money would react less than the price of a put that would be far in the money. Therefore I would argue that these two will not necessarily offset each other.