A customer owns an abc call option. abc declares a dividend for shareholders on record july 5th. the last day to exercise the op

Question

NikAS [45]

2 years ago

7

A customer owns an abc call option. abc declares a dividend for shareholders on record july 5th. the last day to exercise the op

tion and get the dividend is:_________

Business

1 answer:

Lostsunrise [7] · Answer 1 · 2023-08-11T06:27:12+03:00

The last day to get exercise the option and receive the dividend is two business days prior to the record date. The customer can also exercise his dividend claim two business days prior to the ex-date or one business date prior to the ex-date. The only option not available to him is one business day prior to the record date.

An option is a right available to a shareholder to buy a particular stock of which he has bought a call option at an agreed price. This option can be exercised by the holder to purchase the share at any given date and at a price that is agreed upon. The option holder requires to be eligible for dividends,

Dividends are declared as a benefit to shareholders of a company. The options holder will have to purchase the shares before the record date and will be eligible to receive a dividend.