by Dawn Pennington 05/09/08
Q: The day before our stocks' ex-dividend date was assigned, we sold a covered call. The transaction to sell the stock occurred on the following day (the ex-dividend date). Do we receive the dividend?
A: The ex-dividend date is the day when the sale of shares are classified as ex-dividend, that is, the seller preserves the right for dividends, while the buyer doesn't have that right yet. The ex-dividend date usually comes four working days before closing the register (the date of shareholder's register for receiving the dividends) so, yes, you should receive the dividend.
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