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Shares of Apple, Inc. near ex-dividend as it gears up to distribute $2.7 billion to shareholders

post #1 of 72
Thread Starter 
On May 15, Apple will pay "shareholders of record" the company's new higher quarterly dividend of $3.29 per share, but investors need to have purchased the company's stock by the market's close on Wednesday in order to qualify.

cash


Apple has been automatically paying its shareholders a dividend about a month and a half after the end of each fiscal quarter ever since it declared its modern dividend plan in the summer of 2012.

At the current stock price of $592 at its close today, the dividend yield is 2.22 percent. Apple recently announced that it would increase its dividend from the previous $3.05, the second increase in two years.

The new dividend amount is an odd $3.29, making it equally divisible by seven. In June, Apple will split its stock 7-1, an action that won't have a direct impact on its share value because the stock price, dividend and outstanding share count will all be adjusted by the same multiple.

AAPL Dividends & Buybacks



The stock market (in Apple's case, NASDAQ) automatically adjusts the value of the company's stock by the value of the dividend, as the dividend reduces the value of the company because it is paid from the company's cash holdings.

Dividends are a minority portion of Apple's shareholder capital return program, the majority of which has been earmarked for buying back outstanding shares, which increases the scarcity (and therefore value) of Apple's stock by taking shares off the market and retiring them. Removing shares from circulation also enhances the company's closely-watched earnings per share metrics.

Over the past year, Apple has been paying out around $2.8 billion in dividends every quarter, a figure that had increased 15 percent over the $2.5 billion Apple had been paying in 2012, before it first increased its dividend payments last May.



However, Apple has now bought back and retired so many of its shares that its total dividend payment across its outstanding shares has now dropped down to $2.7 billion.

Last quarter, the company spent an additional $18 billion on stock repurchases, and announced the retiring of over 30 million additional shares.

Apple had just $14 billion of its original $90 billion stock buyback plan remaining when it increased the program last month. Since the stock buybacks were initiated, Apple has retired 80 million shares.
post #2 of 72

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

 

The times listed are EST.

post #3 of 72
Quote:
Originally Posted by Apple ][ View Post

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

The times listed are EST.

I believe you can yes. But you gotta take into consideration fluctuation and commissions in there as well.
post #4 of 72

if it was at all possible, i would buy back all of carl ichan's stock.  get that guy out before he tries another ridiculous stunt.

post #5 of 72
I think technically you are correct, but it doesn't really work that way. I think the trade takes 3days to settle before you're the "shareholder of record." And in any event, the shares will open down by about the dividend amount after it's paid.
post #6 of 72
Quote:
Originally Posted by Apple ][ View Post

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

The times listed are EST.

Overall it's more complex than I'll make it out to be here but the general rule that will apply to everyone(?) on this forum is that you need to purchase the stock 3 days before the record date in order to get counted for that payout. In this case the record date is May 12th so you'd have to buy before the close of the market on May 6th. After the close of business on May 12th you could then sell your shares and still get a dividend payout.


edit: Corrected dates.
Edited by SolipsismX - 5/7/14 at 10:31pm

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post #7 of 72
Quote:
Originally Posted by justp1ayin View Post

I believe you can yes. But you gotta take into consideration fluctuation and commissions in there as well.
Quote:
Originally Posted by revenant View Post

if it was at all possible, i would buy back all of carl ichan's stock.  get that guy out before he tries another ridiculous stunt.
Quote:
Originally Posted by williamh View Post

I think technically you are correct, but it doesn't really work that way. I think the trade takes 3days to settle before you're the "shareholder of record." And in any event, the shares will open down by about the dividend amount after it's paid.

I believe the T+3 Process would prohibit that since you're not the company's books until the end of that 3rd day.

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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post #8 of 72

From the article:

 

"The stock market (in Apple's case, NASDAQ) automatically adjusts the value of the company's stock by the value of the dividend, as the dividend reduces the value of the company because it is paid from the company's cash holdings."

 

In a perfect market the value of the company prior to a dividend payout includes the value of the cash, after they pay the dividend the increased selling of the stock reduces the value of the company.  So in theory, the value of the stock the day after will be exactly that much less as you got paid in dividend per share.  

 

Off course the stock market is weird and anything can happen.  I have not seen much of a drop in Apple stock price after it goes ex-dividend, but that is mostly because 2.8 billion dividend payout is only a fraction of the value of the company.  Your idea could work, but since everyone is thinking the same thing, chances are you would sell for less than you bought.  There appeared to be a minor pullback from the recent gains in the last couple of days so you could gamble and buy now and sell next week.  If you can afford to buy enough stock to make the cost of buying and selling trivial, then you could get the dividend and gain on the upswing of the daily minor fluctuation of the stock - or not.  IF you plan to buy and hold, then obviously now is better than next week.

post #9 of 72
Quote:
Originally Posted by SolipsismX View Post


Overall it's more complex than I'll make it out to be here but the general rule that will apply to everyone(?) on this forum is that you need to purchase the stock 3 days before the record date in order to get counted for that payout. In this case the record date is May 12th so you'd have to buy before the close of the market on May 9th. After the close of business on May 12th you could then sell your shares and still get a dividend payout.

 

Perhaps my question was more complicated than I first thought.

 

I got the impression from the OP that it was May 12, but you're now saying that it's May 9? 

 

I'm just curious about what general rule you were mentioning that would apply to everyone on this forum?

 

edit - I see, you're talking about the T3 rule, gotcha. I don't think that it applies to me though.

post #10 of 72
Quote:
Originally Posted by Apple ][ View Post

Perhaps my question was more complicated than I first thought.

I got the impression from the OP that it was May 12, but you're now saying that it's May 9? 

I'm just curious about what general rule you were mentioning that would apply to everyone on this forum?

The record date is the 12th, but have you ever sold stock before and wanted to cash out? It takes three days. That's the T+3 Process. That also works the other way so if you bought stock on May 10th Apple wouldn't record your transaction until the 14th (even though your trade value started at whatever you bought it for on the 10th) so you wouldn't receive the dividends as those were taken from whomever was on record as of the close of day on the 12th, as noted in the link.

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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post #11 of 72
Quote:
Originally Posted by Apple ][ View Post

edit - I see, you're talking about the T3 rule, gotcha. I don't think that it applies to me though.

Are you not talking about stocks?

"The real haunted empire?  It's the New York Times." ~SockRolid

"There is no rule that says the best phones must have the largest screen." ~RoundaboutNow

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"The real haunted empire?  It's the New York Times." ~SockRolid

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post #12 of 72
Quote:
Originally Posted by SolipsismX View Post


The record date is the 12th, but have you ever sold stock before and wanted to cash out? It takes three days. That's the T+3 Process. That also works the other way so if you bought stock on May 10th Apple wouldn't record your transaction until the 14th (even though your trade value started at whatever you bought it for on the 10th) so you wouldn't receive the dividends as those were taken from whomever was on record as of the close of day on the 12th, as noted in the link.

 

I see what you mean now, the settlement period, when buying and selling.

 

I wrote that it didn't apply to me, but I guess that it does, it's just that I don't notice it, because even though I don't really daytrade much, they classified me as one after I violated the rules and did more than the max limit of roundtrip trades in a five day period. So now, I don't have to worry about breaking any rules like that, I just trade however often I want. I could buy and sell APPL 50 times in one day if I wanted to, not that I would of course.

post #13 of 72
Quote:
Originally Posted by SolipsismX View Post


Are you not talking about stocks?

Yes, you can see my reply, above this one.

post #14 of 72
Keep in mind also that buying and then immediately selling a stock results in a higher capital gains tax than if you buy and hold.

https://turbotax.intuit.com/tax-tools/tax-tips/Investments-and-Taxes/Guide-to-Short-term-vs-Long-term-Capital-Gains-Taxes--Brokerage-Accounts--etc--/INF22384.html
Edited by SpamSandwich - 5/7/14 at 10:01pm

Proud AAPL stock owner.

 

GOA

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Proud AAPL stock owner.

 

GOA

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post #15 of 72
Quote:
Originally Posted by Apple ][ View Post
 

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

No. The system is designed so you can't take advantage of it that way. May 12th is the "Record date". If you are on record as a shareholder on May 12th, you get the dividend. May 8th is the "Ex-dividend" date. If you buy shares on or after May 8th, you don't get the dividend because you won't be on record as of May 12th. Not to worry, though, the stock price on May 8th is reduced by the amount of the dividend. So buyers on May 8th don't get the dividend, but they also buy the stock cheaper. If you tried to cheat the system by buying stock on May 7th, you'd get the dividend, but when you sell on May 8th the price you sell at will have been reduced by the dividend amount.

post #16 of 72
Quote:
Originally Posted by chabig View Post
 

No. The system is designed so you can't take advantage of it that way. May 12th is the "Record date". If you are on record as a shareholder on May 12th, you get the dividend. May 8th is the "Ex-dividend" date. If you buy shares on or after May 8th, you don't get the dividend because you won't be on record as of May 12th. Not to worry, though, the stock price on May 8th is reduced by the amount of the dividend. So buyers on May 8th don't get the dividend, but they also buy the stock cheaper. If you tried to cheat the system by buying stock on May 7th, you'd get the dividend, but when you sell on May 8th the price you sell at will have been reduced by the dividend amount.

 

Thanks for the detailed explanation. I now understand how the dividend dates work.

 

Basically, the OP is a bit late then, because there is no chance for anybody to get the dividend, if they don't already own AAPL as of this moment, because it's already May 8th.

post #17 of 72
Quote:
Originally Posted by Apple ][ View Post
 

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

 

The times listed are EST.

 

Have you ever bought or sold a single share of a single stock? You state you own some, but it seems doubtful from that question. There's trading fees. Doing what you describe would result in a net loss, not a net gain, especially for such a pricey stock. 

post #18 of 72
Quote:
Originally Posted by Slurpy View Post
 

 

Have you ever bought or sold a single share of a single stock? You state you own some, but it seems doubtful from that question. There's trading fees. Doing what you describe would result in a net loss, not a net gain, especially for such a pricey stock. 

Did you miss the part of my question where I wrote that I wasn't claiming that it was a good idea or even a profitable idea? I just wanted to know if it was possible.

 

And I don't own any AAPL at the moment. And the trading fees are the same for me, regardless if it's AAPL or some $4 dollar stock.

post #19 of 72
Quote:

Originally Posted by Apple ][ View Post

 

Basically, the OP is a bit late then, because there is no chance for anybody to get the dividend, if they don't already own AAPL as of this moment, because it's already May 8th.

That's correct. If you owned or purchased the shares yesterday, May 7th, you get the dividend. If you buy shares on or after May 8th, you don't. AAPL closed on May 7th at $592.33. When the stock opens for trading on May 8th, it's price will be adjusted down $3.29 (the amount of the dividend).

post #20 of 72
Quote:
Originally Posted by SpamSandwich View Post

Keep in mind also that buying and then immediately selling a stock results in a higher capital gains tax than if you buy and hold.

 

Exactly. Every time Apple issues a dividend AppleInsider puts out this article, and people think they should buy to get free money. In fact it's the complete wrong thing to do.

 

Say Apple's stock price is $600.

Buy the day of the ex-dividend date, you pay $600. Then you get $3.29 handed right back to you taxed at ordinary dividend rates = ordinary income.

Buy the day after, you pay $600-$3.29= $596.71. You hold on to your $3.29 untaxed.

 

The benefit of a dividend only is if you hold on to the stock greater than a year. Basically here, $3.29 of each share is being "sold" for you, and it's being taxed at qualified dividend rates, which is as much as 20% lower than ordinary income. (Under George W, for many people in the lowest brackets, qualified dividends were untaxed. Obama raised them back to 15%)

post #21 of 72
Quote:
Originally Posted by konqerror View Post
 

 

The benefit of a dividend only is if you hold on to the stock greater than a year. Basically here, $3.29 of each share is being "sold" for you, and it's being taxed at qualified dividend rates, which is as much as 20% lower than ordinary income. (Under George W, for many people in the lowest brackets, qualified dividends were untaxed. Obama raised them back to 15%

I believe President Obama tax plan left the tax on qualified dividend the same as it was in Former President Bush plan, for all the tax brackets except the highest 35%. At the 35% bracket all dividend are added to ordinary income and taxed at 35% or 39.5%. But it's still 0% for the bottom brackets and 15% for the others. I'm pretty sure I didn't have to pay any taxes on my qualified AAPL dividend for 2012 and 2013 after going though that confusing calculation in the tax book. And I'm not sure if that's a good thing because if I did have to pay 35% or 39.5% tax on those dividend, my income would have be in the $400,000 range.  


Edited by DavidW - 5/8/14 at 3:25am
post #22 of 72
Quote:
Originally Posted by Apple ][ View Post
 

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

 

The times listed are EST.

you forgot about commissions to buy and sell the stock.  Go run some numbers to find out what the real benefit would be.  It's not worth it.  Your broker might cancel your account for this type of behavior. 

post #23 of 72
Quote:
Originally Posted by drblank View Post

Your broker might cancel your account for this type of behavior. 

The opposite, in fact.

You have no clue about brokers, do you?
post #24 of 72

To take advantage of the dividend you usually have to hold for at least a week or two for the price to recover.  Barring other bad news you should be able to net at least $3.29 dividend.

 

Should be getting my $822.50 divy next week. 

post #25 of 72

Actually looks like the stock will recover the full $3.29 today. Nice.

 

Free dividend for anyone who bought yesterday

post #26 of 72
Yesterday AAPL closed at $592.33 (-2.08) 2DAYS CONSECTIVE LOSS.


Are YOU READY to FILE A CLASS ACTION SUIT Against NASD, NASD Regulation, Nasdaq Stock Market and Against ALL Those Concerned with " Manipulating Market ", " Fraud Transactions " and " Runaway EXPLOITATION " Relating to AAPL out of Market ?


5 Reasons All The AAPL Owners Have to Make Up His Mind to File A Class Action Suit.


1. Let Alone So-Called " Front Running EXPLOITATION ", Activities of HIGH FREQUENCY TRADERS on Current Market, Such As " Getco " and " Night Capital ", Obviously Seem to Contain ILLEGAL ACTS, As Michael Lewis Pointed Out in His Latest Book " FLASH BOYS : A Wall Street REVOLT ", though That Has Long Been Common Perception Among Those who Are Engaged in Market Business.


2. We, AAPL Stock Owners All Over The World, Have The Proper Right to Demand The Compensation for Otherwise Gained Huge Profits in These More Than 24 Months Since 2012 Without VILLAIN's Malicious Wrongdoings.










3. We CAN'T BE HAPPY AT ALL Just Because AAPL Temporarily Recovered $600( Soon Slipped Out of It NOW ), Miserably Hovering Around Such Price Range, WAY $100 BELOW AAPL's All Time High $700. Since AAPL Hit All Time High in 2012, No Proper Reason Has Existed AT ALL to Plunge in Such Hideous Way in The First Place. Apparently AAPL Has Been Manipulated Since THEN. In Order For VILLAIN to Cover Up and Justify Their Wrongdoings, They Have Been Circulating INTENTIONAL CONTORTED SPECULATION " Apple is Doomed Because of THIS, Because of THAT, BLAH, BLAH, BLAH Which Has Been Completely Bogus FABRICATION ".
Circulating " Demagogue & Propaganda " is VILLAIN's CONVENTIONAL TOOL.



4. Temporary Recovery of $600 Doesn't Mean VILLAIN's Manipulation on AAPL Has Stopped for Good AT ALL ! They Can Overturn The Table ANYTIME WHEN THEY WANT.
Despite that Just Like Today, Many Analysts & Pundits Predicted AAPL Would Hit $1.000 Soon, Then They Withdrew What They Themselves Said SHAMEFULLY & SHAMELESSLY As If They Had Said NOTHING After VILLAIN's Scheme Has Been Invoked !



5. We're in ILLUSION Where Free Healthy Market Still Works and Exists. BUT NO MORE !
Current " Algorithm Trading " Makes Trades & Transactions MORE & MORE INVISIBLE, Hardly Possible to Tell " WHAT'S GOING ON IN BACK YARD ".
We Need to KNOW " ENTITY of TRANSACTIONS ".
We Need to Demand Them ( NASD & High Frequency Traders ) to Reveal and Disclose EVERYTHING !
post #27 of 72
Quote:
Originally Posted by sog35 View Post
 

Actually looks like the stock will recover the full $3.29 today. Nice.

 

Free dividend for anyone who bought yesterday

No, not really. All else equal, you would have paid $3.29 more for it (perhaps adjusted for some personal tax effects).

post #28 of 72
Quote:
Originally Posted by Apple ][ View Post
 

I'm not claiming that this would be a good idea or even profitable, but technically speaking, I assume that somebody could buy some shares of AAPL on Monday, May 12 at 3:59 PM, and then dump all those shares on Tuesday, May 13 at 6:01 AM, and still receive the dividend? Is that correct? 

 

The times listed are EST.

Yes, but with two issues:

 

(1) ex-div occurs at midnight, so you can even buy your shares after 4 PM EST, making use of after-market.  Then you can sell in the pre-market.  Things will fluctuate rapidly before close of after hours and after open of pre-market, so if you use YOUR times, your milage may vary.

 

(2) at midnight the price resets down by the $3.29 per share, so you would be counting on it rising a little bit in order to get a profit.  Others may be trying the same thing, so if you don't pull the trigger immediately at open of pre-market, you may find yourself underwater.  Usually the price does work its way back up eventually, but you can't count on it being immediate.  And if some bad news hits before it gets back up, well you may have wasted your time (or even lost money).

 

The bottom line is that even though your scheme has potential, it is not clear that you would be able to pull it off, nor that it would be worth the trouble if you managed to score a dime per share.  Gaming or timing the stock market is basically a fool's errand (IMO).

 

Thompson

post #29 of 72
Quote:
Originally Posted by williamh View Post

I think technically you are correct, but it doesn't really work that way. I think the trade takes 3days to settle before you're the "shareholder of record." And in any event, the shares will open down by about the dividend amount after it's paid.

Nope, the original poster was correct.  It is true that there are three days to make you the shareholder of record, but you don't have to hold them throughout that period to get recorded as such.  You can jettison anytime after midnight that starts the ex-div day.

post #30 of 72
Quote:
Originally Posted by SolipsismX View Post


Overall it's more complex than I'll make it out to be here but the general rule that will apply to everyone(?) on this forum is that you need to purchase the stock 3 days before the record date in order to get counted for that payout. In this case the record date is May 12th so you'd have to buy before the close of the market on May 6th. After the close of business on May 12th you could then sell your shares and still get a dividend payout.

edit: Corrected dates.

Everything you said is true except the last sentence.  You DO NOT have to hold the shares throughout the T+3 days that it takes to record the transaction.  Your sale will also take T+3 days to record.  You can buy before midnight in any open market (meaning including after-hours) and then sell after midnight in any open market (meaning premarket) on ex-div day.

 

Not that it would do any good, for reasons that others have mentioned (the price resets down).

 

Thompson

post #31 of 72
Quote:
Originally Posted by anantksundaram View Post
 

No, not really. All else equal, you would have paid $3.29 more for it (perhaps adjusted for some personal tax effects).

If it recovers in full to the price you paid AND you have an extra $3.29 in your pocket come May 15th, then that's a win.

 

Thompson

post #32 of 72
Quote:
Originally Posted by anantksundaram View Post


The opposite, in fact.

You have no clue about brokers, do you?

 

Well, maybe we work with two different types of brokers.  I like to work with those that give good advice and don't like people doing stupid things.

post #33 of 72
Quote:
Originally Posted by drblank View Post
 

you forgot about commissions to buy and sell the stock.  Go run some numbers to find out what the real benefit would be.  It's not worth it.  Your broker might cancel your account for this type of behavior. 

Commission are only $7 each way (for my brokerage firm), so $14 to buy and sell a stock roundtrip, not exactly a huge sum.

 

I can also trade as often as I like. They won't cancel my account, since I've already been flagged as a daytrader, even though I don't trade every day, but I violated the rules in the past, so I am still designated as a daytrader. Everytime I trade, they make money from me, so they're happy if I trade as often as I can. The more, the better.

 

The last time I bought AAPL, I think that I held it for 20 minutes. I've bought and sold other stocks and held them for only a minute or two sometimes.

post #34 of 72
Quote:
Originally Posted by thompr View Post
 
Quote:
Originally Posted by anantksundaram View Post
 

No, not really. All else equal, you would have paid $3.29 more for it (perhaps adjusted for some personal tax effects).

If it recovers in full to the price you paid AND you have an extra $3.29 in your pocket come May 15th, then that's a win.

 

Thompson

I am afraid you're making it sound like there's a free lunch in this situation. There is none. 

 

If you bought the stock before it went ex-D, you would have paid (about) $3.29 more for it, so that you could get the $3.29 in dividends. Say, the ex-D price of Apple was $596.69. You would have paid $600 for it before it went ex-D. The $600 you paid -- in the absence of any other information or events -- gets you an ex-D stock price of $596.69 + dividends of $3.29 = $600. (Again, I am abstracting from personal tax effects).

 

If the stock 'recovered' (whatever that means!), it would have done so for reasons of other information or events. Let's say it went up by $5. In the absence of dividends, Apple would have traded at $605 because of the event. Ex-D, it trades at $601.69 (which is higher than the $600 you paid for it before it went ex-D), but it is no different from $605 = $596.69 (ex-D price) + $3.29 (dividend) + $5 (event effect).

 

There is no arbitrage opportunity here, in other words.

 

PS: Note that the same logic applies if the stock went down by $5.

post #35 of 72
Quote:
Originally Posted by thompr View Post
 

Yes, but with two issues:

 

(1) ex-div occurs at midnight, so you can even buy your shares after 4 PM EST, making use of after-market.  Then you can sell in the pre-market.  Things will fluctuate rapidly before close of after hours and after open of pre-market, so if you use YOUR times, your milage may vary.

 

(2) at midnight the price resets down by the $3.29 per share, so you would be counting on it rising a little bit in order to get a profit.  Others may be trying the same thing, so if you don't pull the trigger immediately at open of pre-market, you may find yourself underwater.  Usually the price does work its way back up eventually, but you can't count on it being immediate.  And if some bad news hits before it gets back up, well you may have wasted your time (or even lost money).

 

The bottom line is that even though your scheme has potential, it is not clear that you would be able to pull it off, nor that it would be worth the trouble if you managed to score a dime per share.  Gaming or timing the stock market is basically a fool's errand (IMO).

 

Thompson

 

Thanks for the info. I've always had a fuzzy understanding about dividends and dividend dates, but I understand it a lot better now after this thread.

post #36 of 72
Quote:
Originally Posted by Apple ][ View Post
 

Commission are only $7 each way (for my brokerage firm), so $14 to buy and sell a stock roundtrip, not exactly a huge sum.

 

I can also trade as often as I like. They won't cancel my account, since I've already been flagged as a daytrader, even though I don't trade every day, but I violated the rules in the past, so I am still designated as a daytrader. Everytime I trade, they make money from me, so they're happy if I trade as often as I can. The more, the better.

 

The last time I bought AAPL, I think that I held it for 20 minutes. I've bought and sold other stocks and held them for only a minute or two sometimes.

Do you have an actual person that manages your portfolio or are you going through the discount brokers?  I've used both in the past, the discount shops sure, but the brokers that actually have professionals that help manage your finances will many times charge much more than that because they have seasoned trained professionals, not someone they pulled off the street and had them go through the Series 6 and 7 exams.    Some brokers actually have legitimate college degrees and take their line of work seriously and the schlock houses don't always have that. 

 

So it sounds like you are a day trader.  Sorry, I stay away from those types of investors.  Sorry...  Please don't respond to my comments anymore.

 

Thank you. 

post #37 of 72
Quote:
Originally Posted by drblank View Post
 

Do you have an actual person that manages your portfolio or are you going through the discount brokers?  I've used both in the past, the discount shops sure, but the brokers that actually have professionals that help manage your finances will many times charge much more than that because they have seasoned trained professionals, not someone they pulled off the street and had them go through the Series 6 and 7 exams.    Some brokers actually have legitimate college degrees and take their line of work seriously and the schlock houses don't always have that. 

 

So it sounds like you are a day trader.  Sorry, I stay away from those types of investors.  Sorry...  Please don't respond to my comments anymore.

 

Thank you. 

No, there's no person managing any accounts of mine. I use a discount broker (scottrade), and I do everything myself. I like to make my own decisions. If things go wrong, then there's nobody to blame but myself, and if I do good on a trade, I can pat myself on my own back.

 

And yes, I am classified as a day trader, I'm not an investor. I see the stock market as a big poker game. I used to play a lot of poker, now I play stocks instead for my own entertainment and enjoyment.

 

And you responded to my comment before I responded to yours, so if you don't want any more responses to your comments, then don't ever comment on anything that I write, and you will get your wish.

post #38 of 72
Quote:
Originally Posted by Apple ][ View Post
 

No, there's no person managing any accounts of mine. I use a discount broker (scottrade), and I do everything myself. I like to make my own decisions. If things go wrong, then there's nobody to blame but myself, and if I do good on a trade, I can pat myself on my own back.

 

And yes, I am classified as a day trader, I'm not an investor. I see the stock market as a big poker game. I used to play a lot of poker, now I play stocks instead for my own entertainment and enjoyment.

Maybe you should gamble in Vegas, that's where you find more people like yourself.    I don't like taking advice from Day Traders.

post #39 of 72
Quote:
Originally Posted by drblank View Post
 

Maybe you should gamble in Vegas, that's where you find more people like yourself.    I don't like taking advice from Day Traders.

 

I wasn't giving out any advice to anybody here. I was asking a question.

 

And I am actually a successful gambler. When online poker was still legal in the US, I was quite profitable.

 

I use game theory, statistics, math and psychology to win at poker, and I try to apply many of the same techniques to my stock trading.

 

You trade however you want, and I'll trade however I want.

post #40 of 72
Quote:
Originally Posted by anantksundaram View Post
 

I am afraid you're making it sound like there's a free lunch in this situation. There is none. 

 

If you bought the stock before it went ex-D, you would have paid (about) $3.29 more for it, so that you could get the $3.29 in dividends. Say, the ex-D price of Apple was $596.69. You would have paid $600 for it before it went ex-D. The $600 you paid -- in the absence of any other information or events -- gets you an ex-D stock price of $596.69 + dividends of $3.29 = $600. (Again, I am abstracting from personal tax effects).

 

If the stock 'recovered' (whatever that means!), it would have done so for reasons of other information or events. Let's say it went up by $5. In the absence of dividends, Apple would have traded at $605 because of the event. Ex-D, it trades at $601.69 (which is higher than the $600 you paid for it before it went ex-D), but it is no different from $605 = $596.69 (ex-D price) + $3.29 (dividend) + $5 (event effect).

 

There is no arbitrage opportunity here, in other words.

 

PS: Note that the same logic applies if the stock went down by $5.

I never said it was a free lunch.  I'm just cheering the virtual up day, but not saying that the dividend caused it.   See my other posts on this thread.  

 

To your point, if the dividend had never happened, then whatever news caused this increase would have brought us up an equivalent amount (above the hypothetical $600 amount) anyway, so the dividend didn't really figure in either way.

 

I think the poster you responded to was just happy to see the stock recover so quickly.  And (s)he likes cash in pocket.  Sure, if the dividend had never happened, then Apple would be up and (s)he could have sold, say, one half of one percent of their position (or whatever it works out to at these numbers)  to end up with the same amount of cash in pocket and value of their position.  But some people want to get some cash without decreasing their share count.  

 

Personally, I always reinvest my AAPL dividends instead of taking the cash, so it really doesn't matter to me either way.  But I do I like increasing my position over time, because I believe that AAPL's best days are still ahead.  The dividend will do better as shares than in my grubby hands.  And if Apple keeps buying back shares and shredding them while I keep buying more bit by bit, then I end up with a larger fraction of the pie for me.  Yummy!

 

Thompson

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