To receive dividends, a client must be present on the shareholders record before a specific date called ex-date.
Usually, it goes like this:
- the company declares dividends from stock
- the company sets the record date and sends press-release to inform shareholders
- the record day comes; all shareholders on record on that date will get the dividend payment
- the next day comes. It is called the ex-date because from that date the stock trades ex-dividend (meaning everyone who buys stocks after ex-date won’t get the next payment)
- the payable date comes (normally, about one month after the record date) and clients receive dividends on their accounts.
However, in some cases, clients might receive the funds with a few days delay due to the necessary time to process the documentation.