What is a record date?

The date when investors need to hold shares in a company in order to receive a dividend from it. Since a company's shareholders can change frequently as stocks are bought and sold, the record date is a cut-off point that firmly establishes those who are eligible for a payout.

Where have you heard about record dates?

Interest tends to surge in a listed company just after it announces a dividend. Investors will often rush to buy shares in it ahead of the record date to ensure they receive a dividend payout.

What you need to know about record dates.

In the fast-moving world of market trading, record dates play a key role in helping companies to finalise a list of shareholders who are eligible for a dividend.

As well as setting a record date, a company will announce something called an ex-dividend date. This often falls two business days before the record date, and an investor will be eligible to receive a dividend as long as they buy shares in the company before it. On the other hand, they'll lose their eligibility if they buy shares on or after the ex-dividend date.

Find out more about record dates.

Dividends are just one element of the stock market you need to consider when investing. See also capital gains.