RE: Dividend.20 May 2019 19:34
Fair point re: the dividend not being supportable long term, at those levels, but that also assumes the share price remaining at this level, should it rise back to say the 400 mark, then that dividend is considerably less assuming it maintains, which it has in the past, albeit increasing, but only by a tiny amount
What i find more relevant, and i am seeing this more and more, is the price fluctuations following the ex-dividend date, for example take this hypothetical.....
For this example, your share sees a small but noticeable rise into the ex-divi date, with the share price increasing, come the ex-divi date, you become eligible for, lets say a 6% dividend, your all smiles, as you know that money is effectively secured in your account come the payment date, and your investment has made you some money....... until that is.....
on the ex-divi date, you look at your share, and, as expected the price has dropped, because it's gone ex-divi, and usually (not always) you see roughly the dividend percentage in the fall, hopefully a little less..... however, and i'm seeing this more and more lately, the fall is way way over the dividend value, so take your hypothetical example above, you gained 6% divi, but, the share falls say 11% through the ex-divi date, so you could have sold your shares the day before the ex date, and bought exactly the same number back a day later, and pocketed the difference, effectively giving you a payment (think of it as an immediate dividend!) to the tune of more like 10%
makes you wonder sometimes why we bother sticking around for the dividends doesn't it?
I have seen this not only here at times, but also LGEN and NAHL to name but 2 others
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