I want to run a trading idea past you. Im sure its probably been thought of before but here goes..
So I've noticed when a company gives out its dividends, the day of the ExDate it drops by .80 cents or whatever the dividend is. But heres the key, Ive seen with most of the stocks Ive looked at,
TEL share price before the ExDate is $4.50,
The Day of the ExDate it drops to $4. So if you buy long, usually within a couple of days the price jumps back up to $4.50 again but sometimes only $4.40.
So if you buy long with an expected target of 80% increase of the dividend back, its worked out successful.
I dont have any software that would allow me to backtest it on dividend payouts so I turn to you guys to ask, whats your thoughts?