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Dosto, Dividend is a happy word for most investors. Dividend sun ke stock investors bahut khush ho jate hai, kyunki it means earnings in the pocket. Lekin dividend se regarding kai terms hai jo kai investors ko confuse kar dete hai – for example, kya exactly hota hai record date? Aur ex-dividend date ka kya matlab hota hai? When can an investor expect to actually get the dividend? Chaliye let us explore the various stages of the dividend distribution process – let us call these stages the various dividend dates.
There are 4 dividend dates that are of significance for any investor. Yeh 4 dividend dates hote hai
· Dividend announcement date
· Record date
· Ex-dividend date
· Dividend payment date
Basically dividend distribution ek process hota hai. Kisi bhi process ke jaise dividend distribution ke stages hote hai. For example, let us assume you are at a networking party and a lucky draw is announced –guests whose business cards are drawn will win all sorts of luxurious holidays in exotic destinations. Yeh hai the first stage. Fir saare attendees, apne business cards ko fishbowl mein drop kar dete hai … some might have already dropped their cards, some might drop their cards kyunki prize attractive hai. Phir lucky draw ka moment aa jata hai and the winners are announced. This is the third stage. In the fourth stage, the winners take leave and actually make use of the vouchers they have won.
In the same way, dividend distribution is also a process. There are a few stages that need to play out between the announcement of the prize and the actual cashing in of the prize. Each stage has its own role to play –aur dividend distribution process mein har stage ka stock price pe bhi asar padta hai.
Dividend distribution date # 1: Dividend announcement date
Yeh din pe, the company makes the announcement that x% of dividend will be paid to the shareholders. During this stage, zyaada tar, stock ke liye demand shoot up ho jata hai kyunki investors want to claim a dividend on their investment quickly. In ka soch hai ki what can be better than buying a stock and claiming a dividend right away.
Demand pushes the stock price up at this time and many investors also see it as a good time to exit because they might have bought the stock at a lower price. Stock price mein thoda bahut volatility dikh jayegi, because of the flurry of activity. Lekin kya yeh sach hai ki dividend announce hone ke baad bhi, you can buy a stock and still claim the dividend. Ji haan, and that is where record date and ex-dividend date come into play.
Dividend distribution date # 2: Record date
Yeh din pe the company identifies and takes note of shareholders who are entitled to receive dividend. Record date ke baad, the stock price usually drops kyunki ab obviously next dividend ka time hai. Some investors will still hold out in wait of lock terms stock price linked gains. Intraday traders will keep at their various strategies. Some long-term investors might see it fit to buy the stock now that price has dipped. Lekin overall, yeh stage mein stock price plateaus out or decreases. Record toh record date ke end mein ban jata hai toh agar record date – ya record date ke ek din pehle – agar koi investor stock khareed lega, toh woh investor ko dividend mil jayega, right? Nahi dost, we also need to account for the delivery of the shares. When you buy shares, who shares aapko apne demat account mein 2 din ke baad mil jaata hai, correct? If you want to be identified as a shareholder on the record date, you need to already have the shares in your demat account. Toh record date ke 2 din pehle, you need to buy the shares. And that brings us to….
Dividend distribution date # 3: Ex-dividend date
Ex-dividend date is the last opportunity to buy shares for any investor who wants to jump in and grab dividend right away. Yeh din ke baad, a new buyer of the stock ko dividend nahi mil jayega. What happens if the record date falls on a Monday or the day after Diwali or Republic day or some other public holiday? Very simply the ex-dividend day is pushed further back from the record date such that the shareholders receive their stock in their demat account by the record date. Agar aap dividend claim karna chahte ho, toh definitely aapko record date aur ex-dividend date pe dhyan dena hai taaki you do not miss out on account of being late.
Dividend distribution date # 4: Dividend payment date
Yeh din ... ke liye kabhi kabhi aapko bahut din tak rukna padta hai! Kyunki company ko dividend within 30 days of announcement payout karna padta hai. Abhi toh everyone trades online and therefore investors ke bank account details already registered rehte hai – the dividend is credited directly to your bank account. Do keep a lookout for the amount to ensure that it is in fact credited to your bank account. Yaad rakhiye ki dividend payout is taxed in the hands of investors as per the announcement during Budget 2020. Ab tax amount aapke tax slab pe dependent hai. Agar aapka tax slab less than 20% hai toh aapka actually fayda ho sakta hai because the tax you will be paying is lower than what you would have previously lost out on jab Dividend Distribution Tax rehta tha before Budget 2020. If you fall outside the tax bracket, toh aapko koi tax dena hi nahi padega on your dividends. Lekin if you fall in one of the higher tax brackets, aapko bhari tax bharna hoga. High tax-bracket investors might therefore be among those who sell their stock when the prices rise at the dividend announcement stage.
Yeh sab sun ke aap ke dhyan mein aaya hoga ki dividend distribution process mein bhi there are stock investment opportunities for some investors and exit opportunities for other investors. Always understand the workings of the stock market thoroughly before investing – as you are doing by listening to this podcast. Doston, aaj ke podcast mein bas itna hi. Fir milenge next podcast mein. Tab tak ke liye, Angel broking ki taraf se alvida - and happy investing!
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