Ex
Dividend Price Formula
Share price exclusive of dividend is known is Ex
Dividend price. This concept is very important while calculating the cost of
capital.
Ex Dividend Share price = Share price (market share price)
– Dividend to be paid
Ex
Dividend Price Formula Example
Share price is traded in market is $ 10; Company has
announced a dividend of $ 3. Calculate the Ex Dividend price.
Solution
Ex Dividend Share price = $ 10 - $ 3 (Share price
before Dividend – Dividend about to pay)
= $7
