There's a great deal of (mostly inaccurate) information being thrown about regarding dividend payouts and who's entitled to them.
The following's an exerpt from Wikipedia that explains it pretty well.
Cut'n'Paste from Wikipedia:
The ex-dividend date is two business days prior to the record date. To be a stockholder on the Record Date you must purchase the stock before the ex-dividend date. The latest date you can buy the stock to be a stockholder on record and be entitled to the dividend would be one day prior to the ex-dividend date to allow for the three stock trading day settlement of the stock purchase. If you purchase the stock the day before the ex-dividend date you would be a stockholder on the record date and would be entitled to receive the dividend payment.
You do not have to sell the stock after the record date to be entitled to the dividend. However, you must hold and sell your stock on the ex-dividend date or after to be entitled to the dividend payment. In this example, assuming that you purchased the stock one day before the ex-dividend date, you would be a stockholder on the record date. If you sell the stock on the ex-dividend date, the buyer of your stock would be a stockholder one day after the record date given the three stock business trading day settlement. The person that bought your stock would not be entitled to receive the dividend.
You only need to own the stock for one day (the Record Date) to be entitled to receive the dividend payment. If you buy before the ex-dividend date, and sell on the ex-dividend date or after, you will receive the dividend payment.
I,m Still confused at times, even tho I've read the article many times. My broker settles my order, three days after the day I bought. So, I figure I must buy two market days before X div date if I want the div. This way I never worry. Today I bought more shares purposely. I will not get the div, but the reduced price will give me 9.4 percent in the future, which is also good. I,m long holder 1000
Its really pretty simple. Don't worry about the settlement date. Focus on the Ex-dividend date. On the ex-dividend date, the stock trades ex-dividend or with out the right to the dividend. Therefore to receive the dividend you need to own the stock at the close of market on the last business day before the ex-dividend date. FTR traded ex on a Monday so you needed to own on the Friday.