Price Behavior around the Ex-Dividend Date In a perfect world,the stock price will fall by the amount of the dividend on the ex-dividend date. -t…-2 +1 +2 The price drops Ex-dividend by the amount Date of the cash dividend slide 6slide 6 Price Behavior around the Ex Price Behavior around the Ex -Dividend Date Dividend Date ƒ In a perfect world, the stock price will fall by the amount of the dividend on the ex-dividend date. $ P $P - div Ex-dividend Date The price drops by the amount of the cash dividend - t … -2 -1 0 +1 +2 …