What is "Dividend Accrual"

Kassz007 · Nov 25, 2009

Quote from zdreg:

incorrect. there is no monetary loss. imagine a $10 stock with a $5 dividend.

Incorrect. In theory you are correct, but in practice, how often are all other things equal? I would much rather not pay the dividend...

el pollo · Nov 25, 2009

Quote from Kassz007:

Incorrect. In theory you are correct, but in practice, how often are all other things equal? I would much rather not pay the dividend...

Someone trading a live account for more than a week should have a clue about how a dividend is paid, thanks for your .02!

stock777 · Nov 25, 2009

I would refuse to pay the dividend on principle.

http://en.wikipedia.org/wiki/Martingale

l2tradr · Nov 25, 2009

Quote from Kassz007:

Incorrect. In theory you are correct, but in practice, how often are all other things equal? I would much rather not pay the dividend...

Ok, then buy instead of shorting on that day. Free money.

/end sarcasm

KINGOFSHORTS · Nov 25, 2009

Real smart shorting right before Ex-dividend.

stock777 · Nov 25, 2009

Quote from KINGOFSHORTS:

Real smart shorting right before Ex-dividend.

Yep, most shorts are covered before ex data, and put on again the day after.

You can see the short interest drop to near zero with the Yahoo real time short feed.

Guess which one is the King

DHOHHI · Nov 25, 2009

Quote from KINGOFSHORTS:

Real smart shorting right before Ex-dividend.

Uhhh why do you say that? If a stock is acting weak nothing wrong with going short. I've been short a stock the last 2 ex-dividend dates and had to cough up $$$. If I'm making money on my trades the dividend cost is negligible.

pcvix · Nov 26, 2009

Quote from zdreg:

everything else being equal stock opens lower by the amount of dividend the day that someone long is no longer entitled to receive the dividend.

Very clear explanation.

Further info:
http://en.wikipedia.org/wiki/Ex-dividend_date

Martin Gale · Nov 30, 2009

Quote from el pollo:

Lemme' ask yous this; If you were the "owner of record" on those days would you still be whining about receiving the dividend?

Read the original post, moron. In this case, the trade and dividend amounts are peanuts. But if one has to factor in the dividend when computing risk/reward for stocks with dividends, things obviously get complicated.

Again, this was my question: How does one account for dividend in a risk/reward model? If you don't comprehend the question, spare us the sarcasm and crawl back under your rock and let someone else explain.

Martin Gale · Nov 30, 2009

Quote from DHOHHI:

Uhhh why do you say that? If a stock is acting weak nothing wrong with going short. I've been short a stock the last 2 ex-dividend dates and had to cough up $$$. If I'm making money on my trades the dividend cost is negligible.

Exactly. Thanks for a reasonable reply. I have no problem with risk. I have a problem factoring dividend into risk/reward. Haven't thought this through. You obviously take on more risk, which may not be worth it. This was the crux of my question, which the trolls here ignored. ET posers like el pollo love it when someone acknowledges a losing trade because it makes them feel like they have company in their general failure.