What defines an ex-dividend bargain?

An ex-dividend bargain refers specifically to a purchase of stock made between the ex-dividend date and the coupon payment date. This is significant because when an investor buys stock on or after the ex-dividend date, they are not entitled to receive the upcoming dividend payment. This creates an opportunity for the stock to be purchased at a lower price, as sellers may lower the price in anticipation of losing the dividend benefit in the transaction.

Understanding the dynamics of the ex-dividend date is crucial because it marks the cutoff point for new shareholders to receive the dividend. Therefore, anyone purchasing shares prior to this date will receive the dividend, but those buying shares after will not, thus resulting in a pricing adjustment.

The other mentioned choices do not accurately capture the specifics of an ex-dividend bargain. Purchases made before the coupon payment date would still qualify for the dividend, while purchases at or after the coupon payment date would not classify as an ex-dividend bargain, since the seller has already earned the right to the dividend. The purchase of bonds with fixed interest rates is unrelated to the concept of dividends from stocks, hence it does not pertain to the definition in question.