EX Dividend

Quote from Eldredge:

Thanks for the responses. I think def is right, and that explains the price action that was confusing me. I thought the dividend was around $2, but I see that it is actually about 50 cents, and that is how much the stock is down. Thanks again.
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PEG's dividend is $2.16 but that's for the year.Each quarter is 1/4 of that or $0.54. However stocks usually show weakness the day after ex-div because traders buy it the day before to capture the dividend and sell at the open the day after. That's the theory atleast; it's not usually that simple.:)

Tony

PS, Sorry for the late and inopportune replies!:D
 
Quote from mccmatthew:

I am not to clear on the issue of ex dividends, but could you buy the stock a couple of days before the ex-div date or even a week and short the SSF on that issue hedging to a neutral position but profit from the dividend?


Thks,
Matt
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SSFs in theory already price in dividends so I don't think that would work.:confused:

Tony
 
Quote from metooxx:



Disagree.

Not theoretically but from a practical implementation ...
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Sure, I'll agree with that given that there is uncertainty in dividends. But if you see it in the SSF you'll also see it in the options. For the most part, given the spreads and the liklihood that if someone (market maker) mis-prices the dividend they'll be quickly arbed into line, I doubt there is much opportunity for both professionals and laymen.
 
Quote from def:



Sure, I'll agree with that given that there is uncertainty in dividends. But if you see it in the SSF you'll also see it in the options. For the most part, given the spreads and the liklihood that if someone (market maker) mis-prices the dividend they'll be quickly arbed into line, I doubt there is much opportunity for both professionals and laymen.
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My job is quickly arbing things into line; i.e. picking off MMs.

We do see it in the options; however SSF seem cleaner.

Agree; not for the average trader ...
 
Hey def.
Happy 25th!




Quote from def:



Sure, I'll agree with that given that there is uncertainty in dividends. But if you see it in the SSF you'll also see it in the options. For the most part, given the spreads and the liklihood that if someone (market maker) mis-prices the dividend they'll be quickly arbed into line, I doubt there is much opportunity for both professionals and laymen.
More...
 
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