What Is an Ex-Dividend Date?
The ex-dividend date ("ex-date") is the first day a share trades withoutthe right to the next declared distribution. To receive that distribution, you must own the shares before the ex-date — buying on or after it means you'll receive the following distribution instead, not this one.
Why It Matters
The ex-date is the single most important date for timing a purchase around a specific distribution. It's also common for a fund's share price to drop by roughly the distribution amount on the ex-date itself, since the fund's net asset value falls by the cash paid out.
Ex-Date vs. Record Date vs. Payment Date
The record date is when the fund checks its records to determine who officially owns shares (and is therefore entitled to the distribution) — for US-listed ETFs this typically falls right around the ex-date under current settlement rules. The payment date is the separate, later date the cash actually arrives.
This page is educational and general in nature — it is not investment advice.
Frequently Asked Questions
No — you only need to own shares before the ex-dividend date. You can sell any time after the ex-date and still receive the distribution on the payment date, since your entitlement was locked in at the ex-date.
Because the fund's net asset value decreases by roughly the amount of cash it's paying out. This is a mechanical price adjustment, not necessarily a sign of declining fund performance.
They're closely related but not identical — under current US settlement conventions the ex-date typically falls on or immediately relative to the record date, but they are technically distinct concepts.