Template:Record amount paid amount ex amount: Difference between revisions
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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''. | 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 | 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. | ||
But as for the very good questionwhy 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. | But as for the very good questionwhy 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. | ||