This morning, a “Potential Dividend Run Alert” went out for Citigroup Inc (NYSE: C) via our DividendChannel.com Dividend Alerts service, a free email alerts feature. Let’s take a closer look at this situation, shall we?
### What Is a “Dividend Run”?
The concept of a “Dividend Run” is an interesting one that we first encountered at a past ValueForum conference. To explain it, we need to begin with the expected behavior of a stock on its ex-dividend date.
For readers unfamiliar with the term, the **ex-dividend date** is the trading day when any buyer of the stock is no longer entitled to the referenced dividend. Put simply, to receive the upcoming dividend, an investor must purchase the shares before the ex-dividend date.
### Stock Price Behavior on the Ex-Dividend Date
All else being equal, the stock price is expected to drop by approximately the dividend amount on the ex-dividend date. Why? Because if a buyer is entitled to a $0.60 dividend before the ex-dividend date but not after, the stock price adjusts downward by that $0.60 to reflect the payout.
Consider this: if the share price did **not** drop by the dividend amount on the ex-date, buyers would effectively be overpaying by that dividend amount for the same share. Hence, this price adjustment makes perfect logical and economic sense.
### The Logic Behind a Dividend Run
Now, if the stock price is expected to fall by the dividend amount on the ex-dividend date (again, all else equal), it follows that the stock should experience some price appreciation **before** the dividend. After all, if a dividend-paying stock only declined on each ex-dividend date, over time, its value would eventually erode to zero, which doesn’t make sense for a company consistently earning profits and paying dividends.
Therefore, sometime before an ex-dividend date, there tends to be a natural upward “pressure” on the stock price in anticipation of the dividend. This price movement ahead of the dividend is what investors refer to as a **Dividend Run**.
### Timing Strategies for Dividend Runs
It’s important to recognize that different investors have varying views on the optimal timeframe for capturing Dividend Run effects. For example:
– Some investors prefer to buy shares shortly before the ex-dividend date, hold to receive the dividend, and then sell on or after the ex-date.
– Others may sell shares the day **before** the ex-dividend date, aiming to maximize capital gains by capturing price appreciation without necessarily holding through the dividend.
– A common timeframe discussed in capital-gain-focused strategies is to buy approximately two weeks (about ten trading days) prior to the planned sale date.
### Citigroup (NYSE: C) Dividend Run Example
Let’s review an example involving Citigroup’s recent dividends to see this strategy in action.
– The latest dividend of $0.56 per share went ex-dividend on May 5, 2025.
– On the trading day before the ex-date (May 2), shares closed at $70.59.
– Two weeks earlier (April 17), shares closed at $63.25.
This means that in the two weeks leading up to the $0.56 dividend, Citigroup’s stock gained **$7.34** in price.
Looking back at Citigroup’s last four dividend payments, this two-week buy-and-sell strategy would have yielded a capital gain **exceeding the dividend amount 3 out of 4 times**, with a total “Dividend Run” capital gain of approximately **$9.50**. This exceeds the combined dividend payouts over that period, which totaled $2.28.
Here’s the data for the last four dividends:
| Ex-Dividend Date | Dividend | Price 2 Weeks Prior | Price 1 Day Prior | Run Gain/Loss |
|——————|———-|——————–|——————-|————–|
| 08/04/25 | $0.60 | $93.45 | $91.83 | -$1.62 |
| 05/05/25 | $0.56 | $63.25 | $70.59 | +$7.34 |
| 02/03/25 | $0.56 | $78.51 | $81.43 | +$2.92 |
| 11/04/24 | $0.56 | $62.85 | $63.71 | +$0.86 |
– **Total Dividends:** $2.28
– **Total Dividend Run Gains:** +$9.50
### What’s Next for Citigroup?
In about two weeks, Citigroup will go ex-dividend again, paying its latest dividend of $0.60 per share.
– **Upcoming Dividend:** $0.60 per share
– **Ex-Dividend Date:** November 3, 2025
– **Payment Date:** November 26, 2025
– **Dividend Frequency:** Quarterly
Will Citigroup’s Dividend Run history repeat itself? While past performance is never a guarantee of future results, investors who include Dividend Runs in their investment strategies will want to keep an eye on Citigroup, especially given its implied annualized yield of 2.47%.
### Stay Informed
For those interested in identifying future Dividend Run candidates, consider enrolling in our free Dividend Alerts service, which delivers timely email notifications directly to your inbox—courtesy of DividendChannel.com.
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**Also see:**
– Precious Metals Dividend Stocks
– MD Videos
– MDP Split History
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*Disclaimer:* The views and opinions expressed here are those of the author and do not necessarily reflect the views of Nasdaq, Inc.
https://www.nasdaq.com/articles/upcoming-dividend-run-c-0
