There are multiple dates involved with dividends: the declaration date, the exdividend date, the record date, and the payment date.

So when do you need to own the shares to be entitled to a dividend?
And when do you actually receive the dividend?

To be entitled to a dividend, you must own the shares when the markets close the business day BEFORE the exdividend date.

The exdividend date is the first day the stock begins trading without the benefit of the dividend. If you buy shares on or after the exdividend date, you won’t receive dividends for those shares.

Assuming that you owned shares at the close of the market on the business day preceding the exdividend date, you will receive dividends for those shares on the dividend payment date.

I think what makes this confusing is the record date; companies routinely say that the dividend is payable to shareholders of record on the record date. But when you buy shares, it takes two shares for the shares to be “settled.” Thus, if you buy shares on the record date, you won’t be entitled to receive dividends for those shares on the payment date.

You need to own shares at the close of the trading day that precedes the exdividend date to receive dividends on the payment date.
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