Holder of record definition
/What is a Holder of Record?
A holder of record is the registered owner of a security as of the close of business on the record date. This person or other entity must be listed in the security issuer's stock ledger in order to be the holder of record. The concept is of most importance when determining who should receive dividend or interest payments as of the date when they are to be distributed, as well as the ability to vote in corporate elections. When a security is sold, its owner ceases to be the owner of record.
Example of a Holder of Record
As an example of the holder of record concept, Active Corporation’s board of directors announces that it will pay a dividend to all shareholders of record as of March 31. This means that March 31 is the record date. Anna has owned 1,000 shares of Active for the past few years, and so is a holder of record on the record date. She will receive the dividend. Enoch bought 1,000 shares of Active on April 1. He was not a holder of record by the close of business on the record date, and so will not receive a dividend from the company.
This example illustrates the importance of the record date in determining who is a holder of record, and whether that holder will be paid a dividend.