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+[[File:Dividend cycle.png|450px|thumb|right|How the dividend cycle interacts with the Dividend Periods in the {{eqderivdefs}}.]]
 ===Careful: it’s (meant to be) about ''timing'', not amount===
 So what is the difference betwixt a {{eqderivprov|Record Amount}}, {{eqderivprov|Paid Amount}} and {{eqderivprov|Ex Amount}}? To be clear, it is ''not'' about ''whether'' you get paid, nor ''how much'', but ''when''. A {{eqderivprov|Dividend Amount}} is a {{eqderivprov|Dividend Amount}}: in each case “100%<ref>Or whatever other percentage you agree, of course.</ref> of the gross cash dividend per Share”, end of the day. What this is all to do with is  ''when'' a {{eqderivprov|Dividend Amount}} is deemed to occur, which in turn is a function of which {{eqderivprov|Dividend Period}} the trigger for the dividend falls in.
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 *The trigger where {{eqderivprov|Ex Amount}} applies is the '''[[ex date]]''' for the dividend in question. You should pay the gross cash dividend on the {{eqderivprov|Cash Settlement Payment Date}} for that {{eqderivprov|Dividend Period}} in which the [[ex date]] falls.
 *The trigger where {{eqderivprov|Paid Amount}} applies is the '''payment date''' for the dividend in question. You should pay the gross cash dividend on the {{eqderivprov|Cash Settlement Payment Date}} for that {{eqderivprov|Dividend Period}} in which the dividend is paid.
-===“Paid”? Is that, like, different to “declared”? On purpose?===
+===Hang on a minute. “Paid”? Is that, like, different to “declared”? On purpose?===
 Is {{eqderivprov|Paid Amount}} meant to be different from {{eqderivprov|Record Amount}} or {{eqderivprov|Ex Amount}}, in referencing not what is ''declared'', but what the {{eqderivprov|Issuer}} actually physically, real-world, ''paid'' out?
-On one hand, on a natural reading it seems so: {{eqderivprov|Record Amount}} and {{eqderivprov|Ex Amount}} specify an amount by reference to the amount “declared by the {{eqderivprov|Issuer}} to [[holder of record|holders of record]] of a {{eqderivprov|Share}}”, whereas {{eqderivprov|Paid Amount}} references the amount “''paid'' by the {{eqderivprov|Issuer}} during the relevant {{eqderivprov|Dividend Period}} to [[holder of record|holders of record]]”. On the other hand there’s no sensible reason for supposing am {{eqderivprov|Equity Amount Payer}} would want to keep the risk of solvency of an {{isdaprov|Issuer}} if it pays early<ref>or ever, really: that defeats the purpose of an equity derivative</ref> but ''not'' have it if it pays on the payment date. Examination of the world wide web seems to offer little help.
+On one hand, on a natural reading it seems so: {{eqderivprov|Record Amount}} and {{eqderivprov|Ex Amount}} specify an amount by reference to the amount “declared by the {{eqderivprov|Issuer}} to [[holder of record|holders of record]] of a {{eqderivprov|Share}}”, whereas {{eqderivprov|Paid Amount}} references the amount “''paid'' by the {{eqderivprov|Issuer}} during the relevant {{eqderivprov|Dividend Period}} to [[holder of record|holders of record]]”. On the other hand there’s no sensible reason for supposing an {{eqderivprov|Equity Amount Payer}} would want to keep the risk of solvency of an {{isdaprov|Issuer}} if it pays early<ref>or ever, really: that defeats the purpose of an equity derivative</ref> but ''not'' have it if it pays on the payment date. Examination of the world wide web seems to offer little help.
+But here’s a common-sense explanation. Remember the timing of the dividend process:  first it is declared, then, a short [[settlement cycle]] before the [[Record date|record date]] the share trades “ex-div” (this is the “[[ex date]]”), and only then, two or three weeks ''after'' the [[record date]], is the actual {{eqderivprov|Dividend Payment Date}}. And remember this whole farrago is to determine ''in which {{eqderivprov|Dividend Period}} the {{eqderivprov|Dividend Amount}} gets paid''.
+Now, if you chose {{eqderivprov|Ex Amount}}, your {{eqderivprov|Cash Settlement Payment Date}} may well fall ''before'' the actual {{eqderivprov|Dividend Payment Date}}, in which case ''it doesn’t make sense to talk about the dividend paid by the issuer, because it won’t have been paid yet''. If you selected {{eqderivprov|Paid Amount}}, the {{eqderivprov|Cash Settlement Payment Date}} necessarily will fall ''after'' the {{eqderivprov|Dividend Payment Date}}, so it is safe to talk about the dividend having been paid. Because it must have been — and in the disaster scenario where it hasn’t — ie, the corporate failure of the underlying issuer — the {{eqderivprov|Equity Amount Payer}} won’t want to be paying out a {{eqderivprov|Dividend Amount}} anyway.
-Nor does the [[User’s Guide to the 2002 ISDA Equity Derivatives Definitions|ISDA equity derivative user’s guide]]. It suggests, without saying in which cases, that you might need a [[clawback]] right if you don’t want to be on the hook for a {{eqderivprov|Dividend Amount}} declared but not eventually paid by the {{eqderivprov|Issuer}}. But consider this: in what universe would the writer of a derivative referencing an Share, wish to be liable for a dividend declared on but not ultimately paid by the {{eqderivprov|Issuer}}? That would be to do something [[equity derivative]]s are expressly designed not to do.
+But as for the very good question ''why'' would ''any'' [[equity derivative]] purport to pay out a {{eqderivprov|Dividend Amount}} ''before'' the actual real-world payment date for the Dividend it is synthetically replicating? This is a question only {{icds}} would be placed to answer, and they’re not talking.
-===House view: S.N.A.F.U.===
-The [[JC]] concludes this is simply a howler in the {{eqdefs}} which ISDA hastily tried to cover up with that clawback malarkey. In any case, to be safe, reference the {{eqderivprov|Paid Amount}}. Consensus amongst market professionals we have consulted is that {{eqderivprov|Paid Amount}} does, as its drafting suggests, depend on the {{eqderivprov|Issuer}} ponying up. That is where you want to be. <br>