What does 'ex div' mean in relation to share prices?

In the context of share prices, 'ex div' refers to a status where a stock is trading without its upcoming dividend payment. When a stock is labeled as ex-dividend, it means that the share price has been adjusted to exclude the value of the dividend that will be paid to shareholders. This typically occurs one business day before the record date, which is the cut-off date established by the company to determine which shareholders are entitled to receive the dividend.

When a share is marked as ex div, investors who purchase the stock on or after this date will not receive the most recently declared dividend. Instead, the previous owners of the shares will receive the dividend, which affects the trading price of the stock. Since the anticipated dividend has been factored out of the stock's price, the result is that new buyers will pay less for the shares than they would have before the ex-dividend date.

This concept is crucial for investors who are interested in dividend income, as it affects the timing of their purchases in relation to dividend announcements.