A dividend trading opportunity for you?

British Land is due to pay a dividend of 7.75p per share/1.3% on Thurs 4 Oct

• The chart shows British Land share price movements since late August.
• British Land pays a 7.75p/1.3% dividend. Currently at 610p (at time of writing).
• Shares -13.1% from 2018 highs; +0.3% from 2018 lows; -11.8% year-to date
• All CFD positions held over 4.30pm on Weds, 3 Oct will be paid a dividend at 7:15am on Thurs, 4 Oct.
• Those using British Land CFDs receive the dividend 27 days earlier than those using shares.
• On the day the shares trade ex-dividend the share price tends to drop by the same amount

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Trading British Land – An Example

Let’s say you like British Land, and would like to get the 7.75p/1.3% dividend. You decide to buy exposure to £10,000 worth of British Land using a CFD, at the current price of 610p. To do this, you need £2,000.

Shares that go ex-dividend typically fall by the amount of the dividend on the ex-dividend date. Many shares then tend to recover over a period of time, helped by dividends being reinvested, creating a dividend recovery trade opportunity.

Assuming British Land shares recover to their pre-dividend share price, your profit from the dividend would be £130, from your initial investment of £2,000.

Be aware that the share price could fall or rise, which could mean that you make an overall loss or increased profit on the position. For example, let’s assume that British Land falls 4% at the same time it pays the dividend. You overall net loss on your £10,000 position would be £400.

This is provided for information purposes only. It should not be taken as a recommendation.