Every dividend comes with four dates, and only one of them decides whether you get paid. Buy a day too late and the dividend goes to the seller; buy a day early and you receive it, along with a share price that falls by roughly the same amount the morning after. Here is what each date means, which one matters, and what the 2024 switch to next-day settlement changed.
An illustrative dividend, from announcement to cash:
| Date | Example | What happens |
|---|---|---|
| Declaration date | Thu 1 May | The board announces the dividend: the amount per share, the record date and the payment date. |
| Ex-dividend date | Thu 15 May | The first day the shares trade without the dividend. Buy on or after it and you will not receive this payment. |
| Record date | Thu 15 May | The company checks its register; whoever is on it receives the dividend. Under T+1 it is the same day as the ex-date. |
| Payment date | Fri 30 May | The cash arrives in the accounts of the shareholders of record. |
Of the four, the ex-dividend date is the one an investor acts on. The declaration tells you a dividend is coming, the record date is bookkeeping, and the payment date is when the cash shows up. Whether it shows up for you was settled on the ex-date.
Buy before the ex-dividend date — at the latest on the trading day before it — and you receive the dividend. Buy on the ex-date or later and the seller receives it. The same rule runs the other way: you can sell on the ex-date itself and still be paid, because you owned the shares when they went ex.
In the example, a purchase on Wednesday 14 May collects the dividend; a purchase on Thursday 15 May does not.
A stock trade does not settle when you click buy. Until May 2024, US trades settled two business days later (T+2), so a buyer only appeared on the company’s register two days after the trade — and the ex-date had to sit one business day before the record date for a buyer to make it in time.
Since 28 May 2024, US equities settle one business day after the trade (T+1). A purchase the day before the record date now settles on the record date, so for an ordinary cash dividend the ex-date and the record date are the same day. Articles and calculators written before 2024 that put the ex-date a day before the record date are describing the old rule.
One exception worth knowing: for unusually large special dividends — 25% or more of the share price — the exchanges set the ex-date after the payment date instead.
On the ex-date the company is about to hand part of its cash to shareholders, and a buyer that morning will not receive any of it. So the share is worth roughly the dividend less than it was the evening before, and the exchange opening price usually reflects that. A $100 share paying a $1 dividend tends to open near $99, all else equal.
That is why buying the day before the ex-date simply to collect the dividend — “dividend capture” — rarely works as hoped: you receive $1 of cash and hold a share worth about $1 less, and in a taxable account the dividend is taxed while the price drop is merely a paper loss. In the US, dividends are taxed at the lower qualified rate only if you held the shares for more than 60 days in the 121-day window that starts 60 days before the ex-date.
Track a portfolio and the upcoming ex-dividend dates of what you hold appear on the dashboard’s timeline beside the earnings dates, so a date never arrives unannounced. Each company’s page carries its own calendar of reports and dividends. Tracking a portfolio is free; see the portfolio tracker guide for how to set one up.
Educational only. Not investment or tax advice; tax rules differ by country and account.
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