Immediately against the quotation there often appear the letters x d, an abbreviation for ex dividend, which means that the price of the security does not include the dividend which the company has just paid or is about to pay upon it. The name of one who sells the security after the dividend is declared may be on the books of the company, and he will receive the dividend warrant; but if at the time of sale the stock was not quoted ex dividend, he has to hand over the amount of the dividend to the buyer of the stock. The buyer's broker will demand it. Thus when a stock is quoted ex dividend the price immediately falls, other things being the same, by the amount of dividend payable. The dividend in the case just mentioned is sent to the seller of the stock, because from the point of view of the company he is its holder—the transaction occurred after the books of the company had been closed in order to prepare the dividend. The stock is not, of course, quoted ex dividend before the books of the company have been closed, nor before the dividend is actually declared, but the guiding principle is to quote it ex dividend as soon after these events as possible. In the case of the Funds, however, where the closing of the books is on a fixed date, the settlement is made to synchronise with the closing of the books, and the quotation becomes ex dividend practically simultaneously.
Other marks somewhat similar to ex dividend may appear against the quotation in the Official List, such as ex rights, ex new, or ex all. "Rights" may probably refer to the privilege which a holder of the shares has of subscribing to shares in another company, a privilege which enhances the value of the shares he holds. "New" may probably refer to the privilege which a holder has of subscribing for new shares in his own company. Sometimes the holder is entitled to both these privileges, and perhaps others, besides the dividend; all these privileges being referred to for abbreviation's sake as "all." A seller of the shares after they are marked "ex" these privileges retains the privileges, and consequently gets a lower price for the shares.
There is provided in the Official List against the name and quotation of every security ample space for the record of the prices at which business has actually been done during the day. This space is usually blank. If the business done were accurately represented by the markings in the List, the Stock Exchange would be an idle place indeed. Reference has been made in a previous chapter to the reason for the blank appearance of the "business done" column, and it is often urged that in this matter there should be some reform. Many, indeed, go farther and suggest that not only should the prices be recorded in the case of all business transacted, but that means should be devised for placing on record the total volume of that business, as is done in the New York Stock Exchange. There day by day the public is informed as to the number of shares that have been bought and sold; here no such record is kept.
Criticism has often been levelled against the Official List, too, on the ground that its prices are so wide as to be valueless. When a stock is quoted at, say, 106-109, no one who knows his Official List will suppose for a moment that the stock can be bought by the jobber as low as 106 and sold as high as 109. The broker going to the jobber in the market would obtain a much narrower quotation. Even if the student of the Official List might conclude that as the stock is theoretically quoted 106-109, the practical price is round about 107-1/2, that is, midway between the two, it would be something. But as a matter of fact, whilst the stock is quoted 106-109, business may actually be done at 106-1/4 at one time and below 107 all day.
Other critics would have the List greatly expanded, so that official prices might be obtainable for a number of securities more in accordance with the number of those in which dealing actually takes place. These critics say that if the inclusion of all kinds of securities would be inexpedient, as altering the character of the List, then a supplementary list should be issued. Yet other critics say that the prices should be made up to a later hour. The latest profess to be 3.30 o'clock prices, whilst as a matter of fact, they are in the great majority of cases collected half an hour previously; and whilst the official closing time of the Stock Exchange is half-past three o'clock, the House remains open until four o'clock, and dealings go on inside the House until that hour.
Even after the Stock Exchange is closed, of course, business is transacted in what is called the Street Markets. Generally speaking, business in only the most speculative securities is transacted in the street after hours. Dealers in South African mining shares block Throgmorton Street itself for a couple of hours, more or less, according to the activity of business; and dealers in American railroad shares occupy Shorter's Court, a diminutive square just off Throgmorton Street, with which it is connected by a covered way, an entrance to the Stock Exchange being situated in the square. The Street Market in Americans is legitimate in a special sense, because business in New York has been going on for less than an hour when our market is closing, and, of course, the trend of prices in New York has a considerable effect upon quotations here. But the Stock Exchange recognises no street dealings of any kind, and has never done anything to encourage business after hours, in spite of various suggestions that have been made, especially at the time when several members found themselves in the police court, charged with causing an obstruction in Throgmorton Street.
Partly because prices are made up officially only to 3.30 o'clock, but more because brokers desire to furnish their clients with the prices of stocks and shares in which they are specially interested, many brokers compile price lists of their own for despatch to their clients. For practical purposes these smaller lists are more serviceable than the great Official List, as the quotations are not only later, but, being less wide, give more idea of the prices actually prevailing. Another way in which prices are conveyed from the Stock Exchange to the outside world, and a way much more expeditious than by either the Official List or the brokers' lists, is through the medium of the tape machines of the Exchange Telegraph Company. These tape machines are to be found in brokers' offices, clubs, and wherever a subscriber may care to have them, and from the ingenious instrument the tape issues forth all day, showing not only the prices, but the time at which they are quoted.
There is only one class of persons who may not subscribe for the Stock Exchange price service of the Exchange Telegraph Company, and those are outside brokers. Until about twenty years ago a roaring business in the way of betting on the tape used to be transacted in the offices of these outside brokers. Some say they derived their title of "bucket-shops" from the fact that the tape was made to fall from the machine into a bucket for tidiness' sake, but that derivation of the opprobrious title is doubtful. Then, however, the Stock Exchange Committee put a stop to the practice by informing the Exchange Telegraph Company that it must cease to supply outside brokers with the tape, or its privilege of collecting prices in the Stock Exchange would be withdrawn. It was with some difficulty that the privilege was obtained. The company collects the prices in the markets by means of its own staff, and the prices it telegraphs are by no means official.
A kind of weekly edition of the Stock Exchange Daily Official List is issued under exactly the same auspices as that list, and is called "The Stock Exchange Weekly Official Intelligence." It quotes all the same securities, repeating the salient particulars, but instead of giving the current price it shows the highest and lowest prices touched during the week which it covers and since the beginning of the year. It also gives a list of the securities which have been removed from the Daily List owing to absence of business in them, keeping on record the last price marked. It further publishes other important official information, giving notice of forthcoming settling days and buying-in days, recording the special settlements and quotations which have been applied for and have been granted; it gives notice as to when securities are to be quoted ex dividend; it announces dividends, forthcoming company meetings, and closing of transfer books; publishes important notices issued by companies, sets forth traffic returns, and imparts other information. The subscription is £2 10s. a year, exclusive of postage, and single copies may be obtained for 1s. 3d. each. It consists of about thirty large pages.
The information contained in the Daily Official List and in the Weekly Official Intelligence is covered in a ponderous tome called "The Stock Exchange Official Intelligence," which is issued annually. In spite of drastic steps taken in recent years to reduce the bulk of this important Stock Exchange publication, the current volume contains 1,784 pages, and weighs eleven or twelve pounds. Its published price is 50s. The great work deals exhaustively and concisely with practically every security of any importance known in the Stock Exchange, stating clearly the amount, the rate of interest borne or the dividends paid in the past few years, with the highest and lowest prices where they are quoted in the Official List. What amounts to an outline history of every security is furnished, and in the case of companies the names of the directors and officials are set forth. Besides being thus an encyclopædia of Stock Exchange securities, each annual volume contains a number of masterly authoritative treatises on topical subjects, and other appropriate information of a general character. In the compilation of such a work, which is now in its thirty-first year, a vast amount of documentary record has been collected and preserved. The Stock Exchange naturally possesses the most voluminous store of financial and company documents in the world.