Investing

Question about stock transfer between broker account and dividend

  • Last Updated:
  • Dec 17th, 2022 7:03 pm
[OP]
Deal Fanatic
Jan 31, 2007
5020 posts
5139 upvotes
Richmond Hill

Question about stock transfer between broker account and dividend

Havw some question about transfer stock between broker account and dividend.

Let say I submitted request to transfer my RRSP from one broker to another broker. All in kind.
It will take 2-3 weeks. I have no control of would that be 1 week? 2 week? 3 week? Once the requirest is submitted.

Now, what happen if one of the holding have ex-diviend date Dec 14, payout on Dec 19, but the transfer just happen on Dec 16???

Or

Ex-dividend date is Dec 14. All my asset is gone already from my souce broker on Dec 13, but still not show up on my receiving broker on Dec 15??

Anyone have any idea?
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Bright side of RFD: Often find good deal
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8 replies
Deal Addict
May 13, 2005
4034 posts
4070 upvotes
Montreal
You're a lucky that you follow/check the dividends after you transfer.

My case, I didn't bother follow/check the dividends until I find out 4 years later that Scotia iTrade reopen my RRSP account, deposit the dividends and charge admin fee.

You better follow/check the dividends, call and tell your old broker to continuously transfer the dividends for completion the transfer. This way the old broker won't charge you another transfer out fee.

scotiabank-scotia-itrade-transfer-promo ... #p34049213
Deal Fanatic
Aug 17, 2008
8957 posts
10109 upvotes
For those unsure about ex-div, record date vs pay date see;
https://www.investopedia.com/ask/answer ... d-date.asp


(1) Normally it doesn't take that long to transfer

(2) The ex-dividend date, Record date and the Pay date are normally far apart, so your scenario #1 can't happen.

Ex Div + 1 business day normally = Record date
Record date + a month or more = pay date

(3) Scenario #2. One of the brokers always has your assets. Whoever has this particular security on the Record Date will receive the dividend. What you see is not what happens behind the scenes. It is likely that broker #2 has your holdings, but that may not be reflect on what you see. Can't say for sure as transfers aren't perfect.

IMO, you shouldn't spend another second thinking about what could go wrong. You don't know how the process works. If you are going to tsf, just do it & let them do their jobs.

Update

You know when you put in the transfer request. It shouldn't be too onerous to make sure none of your holdings are near or in the ex dividend to pay date time frame. Using someone besides a "Full Service" broker means there are more responsibilities you accept and take on to save yourself some money. The onus is on you to make sure your accounts are in order i.e. the adjusted cost base.
Deal Addict
Jun 25, 2010
1524 posts
1059 upvotes
Transferred kids Resp from one broker to another . The Government grant came(for 2 months ) after the transfer in the old brokerage account. Called the current brokerage to start another transfer. After 2 months I started getting the government grants in the new brokerage account.
“There are the people who don’t know, and the people who don’t know that they don’t know”- Treva84
Deal Fanatic
Aug 17, 2008
8957 posts
10109 upvotes
@nousername Your situation is similar in the end, but different in that the government held the "book of records" and that showed as your old brokerage firm. In the OP's case, the "book of record" or "ledger" is not maintained by government but one of (a) the company's Transfer and Paying agent and/or (b) the clearing agent.
Deal Addict
Jun 25, 2010
1524 posts
1059 upvotes
MrMom wrote: @nousername Your situation is similar in the end, but different in that the government held the "book of records" and that showed as your old brokerage firm. In the OP's case, the "book of record" or "ledger" is not maintained by government but one of (a) the company's Transfer and Paying agent and/or (b) the clearing agent.
Got it . Thanks.
“There are the people who don’t know, and the people who don’t know that they don’t know”- Treva84
Deal Fanatic
Jan 21, 2014
7046 posts
4491 upvotes
I recently transferred my non-registered TFSA & RRSP from TDDI to RBC DI (not by choice) and I encountered something that I think I should mention here.
- TD charged the transfer fees to the account they transfer, (i.e. $169.50 respectively to each of the account).
- When RBC reimbursed the fees, the put both RRSP & TSFA into TFSA. Probably avoiding me over contributing of $169.50 to my RRSP

However, in doing so, I ended up over contributing my TSFA by $169.50x2. It was like that for a couple of months before I realized the issue and withdrew $169.50x2 out of my TSFA and wait for the new year before putting anything back in. Now I don't know if I will be penalized for the over contribution for 2 months. Though the amount was small, so penalty won't be much I guess.

I thought they should have charged the non-registered account for all the fees. But somehow they did that account every quickly, so by the time they transferred the other registered accounts, the non-registered account got nothing in it
Sr. Member
Oct 14, 2012
837 posts
578 upvotes
Woodstock
Usually the bank reimbursement payment of the transfer fees just appears in your account as if they had paid you interest. Same as if they paid you a "bonus" for transferring your accounts to their institution. Are you sure it was reported as a "contribution" to your RRSP/TFSA ? That's pretty unusual.

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