The All Ordinaries Index (ASX: XAO) is experiencing a bit of a pullback today. At the time of writing, the All Ords has slipped by 1.45% and is back below 6,900 points. But that pales in comparison to the Rural Funds Group (ASX: RFF) share price today.
Rural Funds shares are currently down a painful 3.47% to $2.64 each. That comes after the agricultural real estate investment trust (REIT) closed at $2.74 yesterday, but opened at $2.69 this morning.
So why is Rural Funds underperforming so dramatically today?
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Why is the Rural Funds share price falling on Wednesday?
Well, it's for one of the best reasons to have your shares fall in value. Today is the day that Rural Funds shares have traded ex-dividend for the REIT's upcoming dividend distribution.
When an ASX share declares a dividend payment for shareholders, it also declares a date that new shareholders are excluded from being eligible to receive the upcoming payment. This is known as the ex-dividend date.
Seeing as new Rural Funds shareholders from today are ineligible for the company's next payment, the payment's value has left the Rural Funds share price. That is why we are seeing such an apparent drop in value for this REIT today.
So investors can now look forward to the quarterly dividend distribution of 2.93 cents per share that will be paid on 29 July next month. Rural Funds Group typically doles out four quarterly dividend distributions a year.
This upcoming payment will be the fourth to consist of a 2.93 cents per share payment. June 2021's distribution was worth 2.82 cents per share, so this payment represents a 3.9% increase over the previous year.
At the current Rural Funds share price, this agricultural ASX REIT has a market capitalisation of $1.01 billion. Put together, the past four dividend distributions of 2.93 cents per share each now give Rural Funds a trailing yield of 4.44% at this pricing.
