Record Date

The date by which shareholders have to register their ownership of a given share of stock in order to receive a dividend. So...yes, some stocks pay dividends. These are cash payments made as a way to distribute some of a company's profits to shareholders (who, keep in mind, are the company's owners).

But who should receive the dividend in a world where shares trade back and forth like poker chips in a Vegas game in which a gambler has bet the ranch? And when? The question seems obvious, but stocks trade all the time. You bought shares of Dividend United Inc. today...and then sold them tomorrow. The next day, Dividend United declares a dividend. Do you get a pro-rated portion based on the day you owned it?

Nope. Every time a company declares a dividend, it also designates a record date. Hold the stock on that date, and you get the full dividend. No arguments...no splitsies...just one holder on one particular date.