Great question! We’ve also written a bit about this on our blog -
However, the dividend doesn’t just go to whomever holds the stock on payment day. Instead when companies set the payment day for dividends, they assign a record date to check their shareholders in line for the money.
Companies also set an ex-dividend date before the record date. The ex-dividend date is usually a few business days before record date.
An ex-dividend date is the day on which the stock no longer trades with the right to the upcoming dividend. If someone sells a stock on or after ex-dividend day, that seller still gets the next dividend, not the buyer.
There’s a good website for checking this https://www.dividenddata.co.uk/ which lets you sort UK stocks (although not ETFs unfortunately) based on their ex-dividend date & the dividend value etc.
I hope that helps 