Cum div differs from ex div in that, the later
-
A.
entitles the purchaser to recieve a company’s current dividend -
B.
entitles the vendor to recieve a company’s current dividend -
C.
confirms a purchase or sale made on behalf of a share holder -
D.
is a document used to transfer ownership of shares
Correct Answer: Option A
Explanation
Cum dividend is the status of a security when a company is preparing to pay out a dividend at a later date. The seller of a stock cum dividend is selling both the right to the share and the right to the next dividend distribution.
The ex-dividend date of a stock is the day on which the stock begins trading without the subsequent dividend value.