Share Prices Drop on the Ex-Dividend Date, but Usually the Drop

question 15

True/False

Share prices drop on the ex-dividend date, but usually the drop is less than the amount of the dividend.

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Definitions:

Risk Averter

An individual or entity that prefers to avoid uncertainty and potential losses when making investment or financial decisions.

Expected Value

In probability theory, it is the weighted average of all possible values of a random variable, with weights being the probabilities of each outcome.

Natural Log

The logarithm to the base e, where e is an irrational and transcendental constant approximately equal to 2.71828.

Risk Averter

An individual or entity that prefers to avoid risk, typically choosing options with more certain outcomes over those with higher, but more uncertain, returns.