Ex-Distribution

AAA

DEFINITION of 'Ex-Distribution'

A security or investment that is trading without the rights to a specific distribution. When an investment such as a mutual fund or income trust commences trading on an ex-distribution basis, the seller (or the previous owner) rather than the buyer is entitled to receive the distribution. On the ex-distribution date, the security will generally fall by an amount equal to the dollar amount of the distribution.

INVESTOPEDIA EXPLAINS 'Ex-Distribution'

For example, assume a mutual fund with a net asset value per share (NAVPS) of $10 declares a distribution of 50 cents. On the ex-distribution date, the NAVPS of the fund will be $9.50, since the fund units are now trading without the rights to the distribution. This is similar to the decline in a stock when it commences trading on an ex-dividend basis.

RELATED TERMS
  1. Ex-Date

    The date on or after which a security is traded without a previously ...
  2. Ex-Dividend

    A classification of trading shares when a declared dividend belongs ...
  3. Cum Dividend

    When a buyer of a security is entitled to receive a dividend ...
  4. Declaration Date

    1. The date on which the next dividend payment is announced by ...
  5. Net Asset Value - NAV

    A mutual fund's price per share or exchange-traded fund's (ETF) ...
  6. Net Asset Value Per Share - NAVPS

    An expression for net asset value that represents a fund's (mutual, ...
Related Articles
  1. Dissecting Declarations, Ex-Dividends ...
    Investing Basics

    Dissecting Declarations, Ex-Dividends ...

  2. Dividend Facts You May Not Know
    Investing Basics

    Dividend Facts You May Not Know

  3. Dividends, Interest Rates And Their ...
    Options & Futures

    Dividends, Interest Rates And Their ...

  4. Make Ex-Dividends Work For You
    Investing

    Make Ex-Dividends Work For You

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center