dividendAdjustment.titledividendAdjustment.titledividendAdjustment.title

What is a
dividend adjustment?

A dividend is a distribution of a portion of a company’s earnings to its shareholders, often issued as cash payments if you own the underlying shares. In CFD trading, dividend adjustments are made to minimize the financial impact and ensure fair value due to price changes on ex-dividend dates. These adjustments are directly applied to the trading account balance at the start of the trading day, either by crediting or deducting the corresponding amount.

Ex-Dividend Date

Ex-Dividend Date

The ex-dividend date is the deadline by which a share must be owned to be eligible for the upcoming dividend. If a trader opens a share position after the ex-dividend date, they will not be entitled to receive the next dividend payment. Typically, this date falls one business day before the dividend record date.

Dividend Adjustment Application

Dividend Adjustment Application

Dividend adjustments are based on ex-dividend dates and company announcements. For CFDs, a long position will be credited while a short position will be deducted. In stock index trading, however, a 1% handling fee will be charged for adjustments. The adjustment will be automatically applied if a client opens a position after 00:05 (platform time) on the ex-dividend date.

Dividend Adjustment Calculation

Dividend Adjustment Calculation

Formula : Dividend per share x Contract size per lot x Volume (lots) = Dividend adjustment amount.

Stocks

Scenario An open position with Nvidia shares on the ex-dividend date. Assuming 1 lot is equivalent to 100 contracts with dividend per share is calculated as USD 0.10

A long position adjustment calculation:
USD 0.10 x 100 contracts x 1 lot = USD 10

A short position adjustment calculation:
(USD 0.10) x 100 contracts x 1 lot = (USD 10)

1

Indices

Scenario An open position in S&P 500 Spot Index on the ex-dividend date. Assuming 1 lot is equivalent to 100 contracts with dividend per share as USD 3.00

A long position adjustment calculation:
USD 3.00 x 100 contracts x 1 lot = USD 300.00

A short position adjustment calculation:
(USD 3.00) x 100 contracts x 1 lot = (USD 300.00)

2

Start Trading
with CG FinTech

Create Account
Start Trading
CG FinTech
Calendar+971 4555 9581
Calendar[email protected]
iconiconiconicon

Trading

Account

CENT AccountSTANDARD AccountECN AccountDEMO Account

Conditions

DividendDeposits & Withdrawals

Markets

ForexIndicesPrecious MetalsCryptocurrencyEnergiesStocks

Platforms

MetaTrader 4

Tools

Economic CalendarMedia Center

Company

About UsFAQRegulatory ComplianceSponsorship

Partners

Introducing Broker (IB)

DISCLAIMER:

This material comprises personal opinions and ideas. It does not suggest to purchase financial services, nor does it guarantee the performance or outcome of future transactions. The material should not be interpreted as containing any type of financial advice. The accuracy, validity, or completeness of this information is not guaranteed and no liability is assumed for any loss related to any investment based on the material.

RISK WARNING:

Contracts for Differences (‘CFDs’) are leveraged financial products and may incur a high level of risk whereby a small market movement or fluctuation in prices may affect the investment value greatly. It may not be appropriate for all individuals and you should not risk more than you are prepared to lose. CFDs are not traded on any exchange and they are Over-The-Counter products whereby the prices of the CFDs are derived from the underlying market. CFD traders do not own or have any rights to the underlying assets. Before deciding to trade, you should ensure that you understand the risks involved and take into account your level of trading experience. You should obtain independent financial, legal and tax advice before proceeding with any trading instruments. Nothing in this website should be construed as any investment advice by CG FinTech or any of its affiliates, directors, officers or employees. Please read our Risk Disclosure and Acknowledgement Notice and Client Agreement to understand further on the trading risks on our trading platform.

LEGAL:

This website is operated by the following entities:

1. CGTrade (Mauritius) Limited (Company No. 166217) with the registered address at The Cyberati Lounge, Ground Floor, The Catalyst, Silicon Avenue, 40 Cybercity, 72201 Ebene, Republic of Mauritius. CGTrade (Mauritius) Limited is a licensed investment dealer, authorized and regulated by the Mauritius Financial Services Commission (MU FSC), bearing regulatory number C118023669; and

2. CG Fintech HK Limited, (Company No. 2036662), with the registered address at Room D38, 12/F, Mai Gar Industrial Building, 146 Wai Yip Street, Kwun Tong, Kowloon, Hong Kong; and

3. CG Trade Inc, registered at 32F2+655, Castries - Gros Islet Hwy, Rodney Bay, St Lucia, bearing company number 2024-00155.

We do not offer our services to individuals or companies of certain jurisdictions, including but not limited to Canada, North Korea, United States, Hong Kong, Singapore and Malaysia. The information and services on our website are not applicable and shall not be provided to country or jurisdiction where such distribution of information and services are contrary to the respective local statutes and regulations. Visitors from the above regions should confirm whether your decision to invest in our services is in accordance with the statutes and regulations in your country or jurisdiction before you use our services. We reserve our rights to vary, amend or discontinue our products and services at any time.

Please check with your local jurisdiction to determine if you are permitted to open an account with CG FinTech. Contact us at: phone number +971 4555 9581

© 2024 CG FinTech All Rights Reserved.