Origami Friday, page-30

Dividend adjustment work similar to the way they work on individual stocks. If ANZ goes ex-div Monday and you buy on Friday and hold after market close you get the dividend - the dividend amount is guaranteed. On Monday when ANZ goes ex-div, the dividend amount would be deducted from the stock - This is a market function. Similar concept for XJO index, except the drop in the value of the index, dividend price that is proportionate to the weight of stock is subtracted at 16:00:01 instead of waiting until Monday. SPI 200 is a derivative representing the value of underlying stocks during market hours. After market hours, its price is purely driven by speculation.

Dividend plays involving the purchase of a stock before they go ex-div assumes that someone would pay higher price after the stock goes ex-div. 'Efficient markets theory' says there's no advantage.

If you buy the index for the dividend, it contains multiple stocks and you're betting that either the drop in individual stock that went ex-div would be less than value of the dividend OR you believe that other stocks would demand higher bid to offset the dividend drop.

Nothing straightforward or easy, but there are few high probability plays around this. Have a look at Nick Radge(thechartist) book on dividend momentum.

and have a great weekend!