What is the ex-dividend date and does buying right before it get me free money?

The ex-dividend date is the cutoff: to receive an upcoming dividend, you must own the shares before this date. Buy on or after the ex-date and the seller keeps that dividend. It's tempting to think you could buy just before the ex-date, grab the dividend, and sell, but it doesn't work as free money. On the ex-dividend date the stock's price typically drops by roughly the dividend amount, so you gain the dividend and lose about the same in share value. On top of that, in a taxable account the dividend is taxable and short holding periods can make it a nonqualified dividend taxed at higher ordinary rates. This 'dividend capture' strategy rarely pays off after taxes and costs. Long-term investors can ignore the ex-date entirely.