4 ms·
I agree, to an extent. But I did get burned by this mindset... I owned a non-trivial amount of MSFT back in the 90s, and they had never paid dividends. Instead
by oxryly1 11y ago
I agree, to an extent. But I did get burned by this mindset...
I owned a non-trivial amount of MSFT back in the 90s, and they had never paid dividends. Instead, their share price seemed to be linked to the tech bubble and their own popularity. I bought as part of that herd mentality. Eventually, though, I realized that their share price was really not bound by anything concrete, so I sold. A month later, they paid out a big dividend. I missed out on a decent payday.
- nicholas73 11y agoNo you didn't. The dividend cash would just be subtracted from the market cap (roughly) the next day when the market opens.
- oxryly1 11y agoAre you suggesting that any time a dividend is paid on a single share, that share's price drops by exactly the dividend payment amount?
- nicholas73 11y agoYes, among many other factors that affect share price. In some forms of stock (e.g. MLP units) the daily share price change is even adjusted for subtracting the distribution.