Dividend Record Date
Quick Definition
The date set by a company to determine which shareholders are eligible to receive an upcoming dividend.
Key Takeaways
- The record date is the administrative cutoff for dividend eligibility.
- You must buy on or before the ex-dividend date (one day before the record date) to qualify.
- The four key dates are: declaration → ex-dividend → record → payment.
What Is Dividend Record Date?
The dividend record date (or date of record) is the cutoff date established by a company's board of directors to determine which shareholders are entitled to an upcoming dividend payment. Only investors who are registered as shareholders on this date receive the dividend. Due to the T+1 settlement cycle in U.S. markets (effective May 2024), an investor must purchase the stock at least one business day before the record date—i.e., on or before the ex-dividend date—to be listed as a shareholder of record. The sequence of key dividend dates is: declaration date → ex-dividend date → record date → payment date. The record date is primarily an administrative checkpoint; most investors focus on the ex-dividend date since it determines the last day to buy shares and still qualify for the dividend.
Dividend Record Date Example
- 1Company XYZ declares a $0.50 dividend with an ex-date of March 14 and a record date of March 15. Buying on March 14 qualifies; buying on March 15 does not.
- 2An investor who sells shares after the record date but before the payment date still receives the dividend because they were the shareholder of record.
Related Terms
Ex-Dividend Date
The date on which a stock begins trading without the right to receive the upcoming dividend payment.
Dividend Yield
The annual dividend payment divided by stock price, expressed as a percentage, showing the income return on investment.
Stock
A security representing ownership in a corporation, entitling the holder to a share of profits and voting rights.
Initial Public Offering (IPO)
The first sale of a company's stock to the public, transitioning it from private to publicly traded.
NASDAQ
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S&P 500
A market-capitalization-weighted index tracking 500 of the largest U.S. publicly traded companies, widely considered the best single gauge of the American stock market.
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