CFD dividends. Ex-dividend date for indexes?

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1

I didn’t know you also get dividends with CFDs.

How does that work with ex-dividend dates on CFDs for indexes? I have a position on US30 (DJIA).

2

I’m not 100% sure, but with CFDs pretty sure you get the dividend on the ex date.

Edit: Yeah you get it on the ex date. Careful, if you are short you pay the dividend.

https://www.cmcmarkets.com/en-gb/learn-cfd-trading/corporate-actions

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3

As @nickspacemonkey mentioned while trading CFDs you get the dividend on the ex.date.

If you have a position with US30 (DJIA) and some of its constituents distribute a dividend, the price of the relative security will go down due to the fact that the company’s value has lowered. Therefore, we’ll see some drop (every company has different weight in the index) in the price of DJIA. Subsequently, while having short positions you will benefit from this particular action & respectively you have disadvantage holding long positions. That’s why we equalize the conditions in the following manner:

If you are holding short position - dividend will be charged.
If you are holding a long position - dividend will be distributed.

4

@Martin is there a list anywhere with ex-div dates for indices? Or is this always the first of the month?

5

It’s paid by the company in the index. The index has nothing to pay.

https://www.dividend.com/dividend-stocks/dow-30-dividend-stocks/#tm=3-dow-30&r=Webpage%231326&f_4=true&only=meta%2Cdata%2Cthead&sort_by=closest_payment_ex_date&sort_direction=asc

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6

It is a rule of thumb that if some of the constituents have ex. dividend date, the index has also some drop points.

If you mean a source of information where you can see the exact drop points & dividends of the indices - I wouldn’t rely on it, especially if it’s for free. This type of information costs a significant amount of money.

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7

Ok I will see it as a little extra while trading CFDs. Didn’t expect it, so pleasant surprise. Thanks!

8

I think what Martin is trying to get at is:

9

I stopped listening to his channel after he stated that he doesn’t invest in Index funds. :slight_smile:

Practice what you preach…

10

I have some REITs which pay dividends on a monthly basis. For the rest I trade on growth in stock price. I followed a guy on YT who is all for dividend investing, but unfollowed him after he stated that Technical Analysis is BS. Everyone has his/her own style of investing. Anyway off-topic.