Sorry, the market doesn’t serve free dividend lunches

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The market will make certain that you can’t game dividend dates to increase your returns

are usually on the 15th of the same months. Until recently, I have had my utility-sector money split between the two companies. But with the staggered record dates, I realized I could have all my utility-sector money in Emera and then, after the record dates, I could sell Emera and put all my utility money in Fortis. Doing so gets me double the dividend payments compared to splitting my money between them.

Let’s say you buy Emera in October with the expectation of holding it until the record date of Nov. 1, in order to lock in the next dividend payment. You then sell Emera and move on to do the same thing with Fortis. Free money, right? Lots of other factors also affect stock prices, so the adjustment on the ex-dividend date won’t necessarily match the value of the dividend exactly. In some cases, the price might even rise. But the value of the dividend will no longer be reflected in the price.

When a beneficiary is enrolled in a qualifying postsecondary program, grants and earnings can be withdrawn as an educational assistance payment , which is taxed in the hands of the student, often at a relatively low marginal tax rate. The financial institution – also known as the RESP promoter – keeps track of the dollar value of grants, investment earnings and contributions in the account.

 

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