Difference between revisions of "Buy a DRIP Stock"
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A DRIP is a "dividend reinvestment program" that enables stockholders to automatically reinvest dividends paid by the company into the purchase of more shares of stock.<ref>http://www.investopedia.com/ask/answers/04/021304.asp</ref> The program also allows investors to purchase fractional shares of stock in the event that the dividends received aren't large enough to purchase entire shares. The advantage of DRIPs to investors is that they bypass brokerage commissions with the additional share purchases and offer accelerated portfolio growth as income is reinvested in the stock instead of being paid out as cash. | A DRIP is a "dividend reinvestment program" that enables stockholders to automatically reinvest dividends paid by the company into the purchase of more shares of stock.<ref>http://www.investopedia.com/ask/answers/04/021304.asp</ref> The program also allows investors to purchase fractional shares of stock in the event that the dividends received aren't large enough to purchase entire shares. The advantage of DRIPs to investors is that they bypass brokerage commissions with the additional share purchases and offer accelerated portfolio growth as income is reinvested in the stock instead of being paid out as cash. | ||
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== Steps == | == Steps == | ||
=== Identifying the Stocks You Want to Purchase === | === Identifying the Stocks You Want to Purchase === | ||
