Randgold Resources is due to pay a dividend of $2.69 per share/3.3% on Mon 31 Dec

• The chart shows us the share price movements of Randgold Resources since June 2016.
• Randgold Resources pays a $2.6/3.3% dividend. This is part of its imminent merger with Barrick Gold.
• Currently at 6518p (at time of writing).
• Shares -13.4% from 2018 highs; +40.4% from 2018 lows; -11.9% year-to date.
• All CFD positions held over 4.30pm on Fri, 28 Dec will be paid a dividend at 7:15am on Mon, 31 Dec.
• Those using Randgold Resources CFDs receive the dividend 10 days earlier than those using shares.
• On the day the shares trade ex-dividend the share price tends to drop by the same amount.

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Trading  Randgold Resources – An Example

Let’s say you like Randgold and would like to get the $2.6/3.3% dividend. You decide to buy exposure to £10,000 worth of Randgold using a CFD, at the current price of 6518p. To do this, you need £2,000.

Shares that go ex-dividend typically fall by the amount of the dividend on the ex-dividend date. Many shares then tend to recover over a period of time, helped by dividends being reinvested, creating a dividend recovery trade opportunity.

Assuming Randgold shares recover to their pre-dividend share price, your profit from the dividend would be £330, from your initial investment of £2,000.

Be aware that the share price could fall or rise, which could mean that you make an overall loss or increased profit on the position. For example, let’s assume that Randgold falls 2% at the same time it pays the dividend. You overall net loss on your £10,000 position would be £200.

This is provided for information purposes only. It should not be taken as a recommendation.