SHARETIPSINFO >> Articles Directory >>Book Closure - A More Pronounced Cut Off
Share market is an area where a lot of technical jargon is heard. A better understanding of these terms are so vital and quite essential from the part of an investor as he is ultimately trying to make profit with his investment.
Upward inclination of growth is the one and only property you can find in the graph of share market when the matter concerns to the daily progression of international market. There, the procedural pattern is in such a way that, the shares are transferred or handed over from one person to other, or more precisely, from one investor to other investor. As a matter of fact, backtracking of the initial or original share holder proves to be a wee bit too cumbersome a task, since the hierarchy of share holders could be too lengthy to climb up. Hence, the less amicability of companies in treating the act of distributing the shares in a joint share market is very well supplemented by the previous mentioned reason. In all the cases, the share owners should be identified to give away their bonuses and dividends. All these tasks tend to be impractical in such circumstance. Therefore, the companies try to declare the dividend and bonus issue to the share holders. They fix a certain date for this process. It is often referred to as book closure.
After this date, the company generally never handles share requests. This is to make everything related to the issue of benefits and dividends to get settled. So they wait until the benefits are handed over. The benefits are given to the share holders whose names are included with the company’s register. Any one who registers with the company on the closure date is entitled to get the dividend and the benefits from the company. So, it is clear that those who have not registered at the book closure date are not eligible to receive their benefits. So, it doesn’t matter if a share holder buys a share from another holder after the book closure date. The benefits, bonuses and dividends are to be received by the original holder, since the purchase of share is made after the book closure date.
It should be very well understood that the book closure and record date are different in context, before getting into the serious play in share market. Record date as mentioned, never winds up its register, whereas book closure is lot more pronounced in meeting the deadlines.
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