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How will SBK dividend effect warrant price SBKSBI

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Anyone know how the last day of trade on June 1 for SBK dividend going to effect warrant price on SBKSBI as share trades ex-dividend after June 1st? First time I'm holding a warrant where the underlying is going to do this.
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5 REPLIES 5
Super Contributor
Safest is always to phone the issuer and ask. Here is the general rule.
The issuers does make provision for a dividend. You don't get it. They keep it, but the warrant price will not drop when the share price drop on LDT+1.
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Super Contributor
would the same apply for SSF's? i think it should, just making sure?
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Valued Contributor
it will have no effect. But more imprtantly is that SBK is not paying a div on 01 Jun. Maybe you're looking at the SBK pref share?
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Super Contributor
Yes, for SSF it is the same. With SSF, there is another twist. When the dividend is announced, a payment is made into your account called "dividend protection" and the SSF price drops by that amount. On LDT+1, the SSF price does not drop with the underlying. Can be very confusing and play havoc with the stop loss system.
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Valued Contributor
cfm, that payment (or deduction) is only made if the div assumption is wrong when the reality is announced.
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