Dividends and price movement

Discussion in 'Trading' started by Fizber, Nov 13, 2006.

  1. Fizber


    Using McDonalds as an example I want to know the general trend for dividends and the price of the stock after they are declared. McDonalds just declared an annual 1.00 dividend. Now I know the exchange lowers the price of the stock by that amount on the ex-date. So if McDonalds was trading in the high 41 to 42 flat range previous to the ex-date is it likely that people will forget about the dividend and bid it back up to its previous range? It was already bid back up to 41.50 but is that likely to hold or are people who bought before ex-date just waiting to dump the shares once they are bid up? So will it go back to high 40 to 41 range?
  2. Only pros do ex-dividend plays...
    And you can assume that pros know exactly what they are doing.

    Why don't you get 10 years of daily price and dividend data....
    On 100 dividend paying large caps...
    And run a simple historical analysis.