"I am not sure how it was that the big dividend went ex-dividend AFTER being paid"
It was that way because of FINRA rule 11140 (b) (2). It states: "In respect to cash dividends or distributions, stock dividends and/or splits, and the distribution of warrants, which are 25% or greater of the value of the subject security, the ex-dividend date shall be the first business day following the payable date."
"I think there was some technical way they accomplished this without any kind of unfairness to anyone"
Yes, and that technical way was by employing the use of due bills. A due bill was attached to every share sold between what would've been the ex-date had normal dividend rules applied and the actual ex-date. The due bill obligates the seller to forward the dividend to the buyer. Everything ends up fair.
Ah, I see -- when you make incorrect statements and are questioned on them, then give responses that have nothing to do with what you're questioned about, it's the reader's fault.
Now I know.
But your statements have nothing to do with my question.
You said, "When you buy, you don't actually own the shares until the end of T+3."
When I questioned your obvious error, you started talking about buying a stock without having enough cash in the account to pay for it on the settlement date. That has nothing to do with when you own a stock.
You own a stock the instant the trade is transacted. That's why you benefit from a gain or suffer a loss if you sell before the trade settles. But you don't become a shareholder of record until the settlement date, which is three days after the transaction date. That's why you have to buy a stock three days before the dividend record date to receive the dividend. THAT is the correct answer.
Free riding is an entire different matter. You don't seem to know the difference.
"It depends on the amount of cash you maintain in your taxable account"
So, if you have enough cash, then you own a stock the instant you buy it, but if you don't have enough cash, then you don't own it until three days later?
Your explanations don't often address the questions, do they?
"Whey you buy, you don't actually own the shares until the end of T+3."
Really? So if you buy a stock on a Monday, sell it for $1,000 gain on Tuesday, you don't get to keep the gain because you won't actually own the stock until Thursday?
What's wrong with this picture?
"they will have to lower the dividend to increase future earnings"
That makes no sense. Dividends have no impact on earnings. The two are entirely different things.
"Plus, you would have to post a ex-dividend date not a press release stating it planned to pay a dividend to investors."
No, it's never a requirement that a company paying any kind of distribution post an ex-date. Ex-dates are set by stock exchanges, not individual companies. However, it is a requirement of a distribution paying company to declare a record date and a payment date.
Stock exchange rules also state that distributions worth one cent per share or less will not have an ex-date.
"The last day to get the div is the ex-date, 3/20"
No. The ex date is the first day that buyers DON'T qualify for the dividend.
"and you must hold through 3/24, the record date."
No. Once a buyer qualifies for the dividend by buying anytime BEFORE the ex-date, they need hold the stock only until the ex-date. There is no need to hold through the record date.
Thanks for trying, though.
"to be eligible by being a SHLD holder of record by 03/24 ...today was it!!!"
No. You can buy as late as the payment date, April 4 and still qualify for the spinoff. As you say, "if the share is sold prior to......, the spin off share goes with it."
And when the spinoff share goes with any sale of SHLD before the ex-date of April 7, where do you think it goes to? To the buyer, obviously. So it's NOT necessary to be a shareholder of record to get the spinoff share.
The press release says that the spinoff will go to all shareholders of record as of March 24 because anyone who is a shareholder of record will indeed get the spinoff. But if they sell before the ex-date of April 7, they are obligated to forward the spinoff shares to the buyer. That forwarding is done through the due bill process executed by the brokerage firms. The company takes no part in the due bill process. That's why the company says all shareholders of record will receive the spinoff -- that's their total involvement in the process.
No, it's not ex tomorrow. Ex-dates for spinoffs don't follow the same rules as for cash distributions. For spinoffs, the ex-date is the first trading day after the distribution date. With the distribution date of the spinoff being April 4, the ex-date is April 7.
Actually, the company website proves dog01buck is correct. A record date of March 20, 2014 does indeed make tomorrow, March 18, the ex-date. You can check the NASDAQ site for confirmation.
" There was ONE secondary offering with RIGHTS offered to guarantee a price of $17 to those who purchased them"
No, that wasn't the case.
"they extended the ONE offering and did not create a second offering as some believe"
It's not a belief, it is a fact. Read the prospectus for the rights offering and the prospectus for the secondary. They are separate events and as such required separate prospectuses and SEC filings.
"In order to actually perform a Second offering, they would have to file again with the SEC."
Yes, and that's exactly what they did. The secondary prospectus was filed on March 10, several days after the conclusion of the rights offering. It notes at the top that it is a supplement to the prospectus filed as a shelf registration on August 22, 2013.
"Everything relative to this offering is contained in the original filings."
No, you're referring to the shelf registration from last year. The rights offering required its own SEC filing, which was made, and the secondary required yet another separate SEC filing, which was also done. The purpose of a shelf registration is to speed the process of equity issuance when the company decides the time is right to do so -- they are then already on record with most of the necessary paperwork except for the specific details of a specific issuance, which is done at the time of each specific issuance. And that's what was done here for each of the two equity sales, the rights offering and the secondary.
"Unfortunately sometimes investors don't read or fully understand what they are entering in to."
And you are definitive proof of that.
AAL doesn't pay dividends. See #6 in the FAQ on their website under Investor Relations:
6. Does AAL pay a dividend?
The company does not pay dividends on common stock at this time and does not expect to do so in the foreseeable future.
"correction: You need to be in WIN by the by the EX- DIV date of 3/27 and stay in
through the record date of 3/31 in order to get the dividend."
No. You need to buy before the ex-date and hold only until the ex-date. There is no need to hold through the record date. This is simple, fundamental stuff.
You could've sold any time on the 5th and still receive the dividend. It is the ex-date that determines who gets the dividend. Buy before the ex-date and hold until the ex date and you get the dividend. That's the whole purpose of the ex-date. It has no other function.
"you need to understand, I collect dividends from several different stocks"
Then it's surprising you don't understand how dividend dates work, because you are definitely wrong. Do a google search for "understanding dividend dates" and get back to us.
"Must hold at close of business."
"See February 18th, 2014 press release."
OK, let's see what it says: "... to holders of record of common stock at the close of business on March 7, 2014."
If you sold the stock on March 5th, you'd still be the shareholder of record at the close of business on March 7th, because it takes stock transactions three days to settle. It wouldn't be until the close of business on the 10th that a seller on the 5th would no longer be the shareholder of record. The very purpose of the ex-date is to take into consideration those three days necessary to settle the transaction.
"Shareholders of record on Friday, March 7th ... As long as you owned it on that day you get the dividend buy it the day before and sell the day after and you still get the dividend"
You're confusing record date with ex-date. It is the ex-date that determines who gets the dividend, not the record date. The ex date was March 5th. Only buyers before the 5th get the dividend. Look at the chart. See that plunge on the 5th? That's because buyers on the 5th no longer qualified for the dividend. Because of the three day settlement rule, buyers on or before the 4th will be shareholders of record on the 7th, even if they sell on the 5th.