Questions tagged [dividend-reinvestment]

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23
votes
5answers
5k views

Dividends - Why the push to reinvest?

I recently received an email from my brokerage (UK based) stating: "Research from Barclays shows that without dividends, £100 invested in the UK stock market since 1899 would have grown into just £...
12
votes
1answer
40k views

What does it mean if a company pays a quarterly dividend? How much would I get quarterly?

If I have a single share, lets say in Google which is currently worth 605.79. Lets say they pay out the dividends quarterly. What does that mean and how much would I get quarterly?
10
votes
1answer
2k views

How exactly do dividend reinvestment plans (DRIPs) work?

And where can I find out what companies offer them? Are there good resources for information on these plans?
9
votes
3answers
833 views

What to do with small dividends in brokerage account?

I just got paid some dividends from an ETF that I own. It is only $4, which is sitting as cash in my brokerage account. I'm aware that this is a very tiny amount of money in the grand scheme of things,...
9
votes
2answers
32k views

Why would a company issue a scrip dividend and how will this issue affect me?

Barclays in the UK have sent out a leaflet recently (online version) saying they are moving to a Scrip Dividend programme. The FAQ does its best to answer questions but still uses a lot of jargon and ...
7
votes
3answers
289 views

What do mutual funds do with the dividends that the securities that they contain give out?

For example, Vanguard Dividend funds have a lot of stocks that give out dividends. Are there any regulatory requirements for Vanguard to distribute the fund? Can they decide to do whatever they want ...
5
votes
1answer
63 views

Are DRIPs subject to a settlement period?

Are DRIPs subject to a settlement period (e.g. T+2)? Does the answer depend on whether the dividend reinvestment accounts for complete shares vs only fractional shares? Are there any time ...
4
votes
4answers
11k views

ETF S&P 500 with Reinvested Dividend

All ETFs tracking the S&P 500 Index I know (SPY, VOO, IVV) pay dividends several times per years. Is there any ETF that tracks the S&P 500 Index but instead of paying dividends they reinvest ...
4
votes
4answers
2k views

Dividend vs Growth Stocks for young investors

I am a young investor (24 yo) with a stable income and would like to know which long-term investment plan would be more appropriate for people around my age and why: Growth Stocks or Dividend Growth ...
4
votes
3answers
232 views

Wouldn't it be better if reinvested dividends were simply treatable as capital gains for tax purposes?

Suppose I own 100 shares in XYZ corp purchased for 25c in year 2000. If XYZ corp pays me 5c in dividends in year 2001, I will owe tax on the 5c dividends, hopefully as qualified dividends(?). If on ...
4
votes
4answers
1k views

Reinvesting dividends and capital gains

I have several different accounts at Fidelity (regular taxable, 401k, Roth IRA, HSA). With the exception of the few mutual funds I have, almost everything is set for dividends and capital gains to be ...
4
votes
1answer
478 views

How to automatically reinvest in non-dividend paying funds

I've read Einsteins quote stating "The most powerful force in the universe is compound interest." However, everywhere I read this is basically only possible with dividend paying stocks and then ...
4
votes
1answer
6k views

Chart total return of mutual fund vs. stock with dividends reinvested? [closed]

Using common charting software, how can I best compare total returns of a mutual fund vs. total return of a stock, with dividend reinvestment (DRIP) in each case? Frequently the easy to get charts ...
4
votes
1answer
215 views

Missing 401(k) dividends

I have a 401(k) with a gigantic, global, US-based company. The funds available to me include a variety of non-tickered funds - meaning that there's no symbol I can independently research - such as ...
2
votes
4answers
2k views

What is the difference between a scrip dividend and a stock split?

Definitions of both scrip dividend and share split gives the same meaning. What is the difference between a scrip dividend and share splits?
2
votes
1answer
98 views

Why do dividend reinvestments not match my calculator?

I've seen this occur numerous times in my IRAs. In the transaction section of my Fidelity IRA, it shows a line item Reinvestment XXX with a dollar amount. Clicking the details will display the ...
2
votes
2answers
167 views

Index ETF or Index mutual fund - standard brokerage account

If I plan to hold an asset for 10 years, the asset is offered as a mutual fund and an etf, with the same 0.25% fee, and quarterly dividends of 100.00, from a tax and reinvestment standpoint, which ...
2
votes
1answer
296 views

Why are mutual fund dividends and capital gains reinvested at different prices on the same date?

Consider the following mutual fund statement. The fund reinvested both capital gains and dividends on the same date, yet the reinvestment cost per share is different for the dividends than it is for ...
2
votes
1answer
198 views

Can a dividend reinvestment plan (DRIP) and share purchase plan (SPP) be used with a TFSA?

Can I put Sun Life (SLF) shares into a dividend reinvestment plan (DRIP) and share purchase plan (SPP) plan, and then put into a TFSA investment account for a family member, 5 to 10 year term?
2
votes
2answers
778 views

Are company dividend reinvestment plans (DRIP) limited to US citizens?

Im moving to the states in 5 months but would like to start investing in US companies, namely through dividend reinvestment schemes. Are these limited to US citizens or can I start investing from ...
2
votes
1answer
321 views

DRIP Vs. Cash Dividend in a taxable account - Which one is beneficial from the tax perspective?

I believe dividends are considered as an income and if you reinvest using DRIP it won't be income but capital gain later when you sell the stock? What are some advantages and disadvantages of doing ...
2
votes
1answer
110 views

Taxes on qualifying dividends when reinvesting

I put all my investment money in a managed account with Chase Private. The account is set up to reinvest all dividends, capital gain distributions and interests my stocks/mutual funds/treasury funds ...
2
votes
5answers
2k views

What's the difference between a high yield dividend stock vs a growth stock?

I'm new to investing and still learning my way. What's the difference between a stock that stays relatively stable during good and bad times and returns a high dividend vs a stock that is supposed to ...
2
votes
2answers
2k views

Wash sale rule with dividend reinvestment

Let's say I buy some stock. Two weeks later it pays a dividend which is reinvested in fractional shares of the stock. The next day I sell all shares at a loss. Would this be considered a wash sale? ...
2
votes
1answer
711 views

Why do many British companies offer a scrip dividend option in lieu of cash?

Some stocks like GlaxoSmithKline, HSBC, Tesco, Unilever all offer dividends every quarterly/yearly, with the option of scrip dividend (opting to use the dividend to purchase shares). Why would ...
2
votes
2answers
3k views

Concerning ETF that do dividend reinvestment for you. Is that taxable?

My understanding that when you purchase an ETF, you technically own your portion of the underlying holdings. (This is the reason commodity ETFs are taxed like commodities.) Per the below an ETF may ...
2
votes
0answers
111 views

What does “No Sweep” Mean in Citibank Context

I am in the process of opening Traditional IRA account with Citibank (currently have checking and saving account at Citibank) Purpose is to purchase ETF for long-term. Form has section to determine ...
1
vote
1answer
149 views

Taxation on DRIPs in Canada

I am starting to invest in DRIPs, as I believe they would be the best investment for me at my current point in life. I am reading some other questions here, and people are stating that the income, ...
1
vote
1answer
62 views

Shares bought in a dividend reinvestment plan, where do they come from?

I just received a notice that my dividend was used to purchase and additional 5 shares in the the ETF. Since there are only a limited amount of trade-able units, where did these additional 5 come ...
1
vote
2answers
422 views

Why is there less buzz around IEP (Carl Icahn) than BRK.B (Warren Buffett)?

IEP is 95% owned by Carl Icahn. It most certainly passes the Skin in the Game principle Nassim Taleb likes to talk about. I happen to own a couple of shares in it because of the man's incredible ...
1
vote
1answer
84 views

Does reinvesting dividends after selling for a loss cause a wash sale? [duplicate]

I sold some fund shares with high turnover on my personal investment account with the intent of buying something similar later on my IRA account. However, after I sold (and within 30 days), I ...
1
vote
1answer
156 views

Selling non-dividend for dividend stocks

H all, Few years ago , I received from my previous employer several hundred RSU, all managed by ETrade. since then all have already got Vested. I never sold neither bought any, in other words, I ...
1
vote
1answer
80 views

Is there a way to avoid short-term capital gains taxes on bond funds?

It appears that most bond ETFs pay out monthly distributions from interest earnings. Is there a way to directly reinvesting the earnings on the fund without triggering a taxable event? Are there any ...
1
vote
2answers
97 views

How to chart what a mutual fund or ETF will return if dividends are reinvested?

When looking at financial charts like bigcharts.com, the chart shows closing price (or OHLC) for each day. This shows growth (or decline) of the equity if dividends are not reinvested. But what if ...
1
vote
3answers
184 views

Keeping track of “out of pocket” cost basis

Dilemma I have some criticism about the cost basis reported on brokerage websites. It isn't your out-of-pocket cost basis. It accounts for reinvested dividends. As a result, the gain/loss number ...
1
vote
1answer
66 views

Indian Mutual Funds

I am new to Stock Markets. I have interests to invest my savings on Mutual Funds. When I looking for Higher Return Mutual Fund securities, I have seen some information there. For Example, I am ...
1
vote
1answer
851 views

Are automatic Dividend Reinvestments (DRIPs) subject to Redemption Fees?

It's the end of 2015, and most mutual funds are paying out their annual dividends, which I have enrolled in DRIPs (dividend reinvestment programs). Since a "DRIP" transaction is similar to purchasing ...
1
vote
1answer
22 views

Dividend from ESOP to Cash - India

I'm Indian and working for a US organisation in India. I have been investing in the Employee Stock Purchase Plan (ESPP) for a while now. During the initial investment period, I had not opted for re-...
0
votes
2answers
117 views

How inflation affects returns and dividends

How inflation is linked to returns AND dividends? We know that adj returns are (1+return)/(1+inflation) -1 But how do we account for dividends? Suppose: 10% annual return 3% inflation 4% dividend ...
0
votes
2answers
220 views

Do SPY prices include dividends?

I'd like to calculate the return of SPY over a range of time. For example: 5/1/18: 264.98 9/14/18: 290.88 264.98 - 290.88 = 25.9 25.9/264.98= 0.0977 = 9.77% Does the 9.77% return include SPY ...
0
votes
2answers
277 views

How many stocks will I own in n years if I reinvest my dividends?

Let's say that I own 1000 shares of a stock at 20$. Every quarter, I get a dividend of 0.20$ which is reinvested (buy more of the same stock). Considering that the stock grows 5% annually, how many ...
0
votes
1answer
153 views

Is it possible that for shares to be reinvested in a stock you already sold?

I just recently set my taxable investment account from reinvest dividends to deposit in cash. However, there seems to be a delay (I assume related to one of the various dates associated with dividends)...
0
votes
1answer
37 views

Is high liquidity required to fulfill DRIPs?

With DRIPs you get equity instead of cash, but where is this equity coming from? If it's from the existing market then what happens in low liquidity situations?
0
votes
2answers
108 views

Different avenues of tangible returns from index funds and bond funds

I am a beginner investor and I've been out of school at this point having saved enough to seriously look at where I am investing my money. I have decided to start off with a portfolio that is ...
-1
votes
1answer
224 views

Meaning of reinvestment

Is it correct that stocks and mutual funds can distribute dividends and capital gains automatically without account holders' intervention, and then reinvest the distributed to buy new shares? From ...
-2
votes
1answer
605 views

Which of these unrealized profit calculations is correct? And, why other calculations are wrong?

Which of these unrealized profit calculations is correct? And, why other calculations are wrong? @ $10 per unit, $1000 - Subscription (100 units) $0500 - Cash dividend (50 units) $0500 - Reinvested ...