How To Invest In A Dividend Reinvestment Plan: How To Buy & Trade DRIP

Dividend Reinvestment Plan (DRIP)

DRIP (dividend reinvestment plan) is a type of investment plan that allows you to buy more number of shares of the primary company in place of getting quarterly cash dividend distributions from any other company. Key function of DRIP is to enhance one’s position in the stock market. These programs are popularly sought by investors as they are known to abolish the requirement to use and pay for stock brokerage services.

The below-mentioned tips are experts’ opinions related to investment techniques in dividend reinvestment plan. They would offer you deep insight into how to buy DRIPs.

How to Start Investing in DRIPs – Tips on how to buy and how to trade

  • §  In order to start investment in DRIPs, your first move should be choosing a stock that you would like to go along. However, you should remember that DRIP is not offered by all stocks. So, your options, here, are somewhat restricted.
  • §  While you are up to pick out a stock that offers dividend reinvestment, consider visiting the website Apart from it, you would also find several other websites which are known to list all dividend reinvestment stocks. However, it would be a discerning idea to opt for a company whose services do not involve any type of fee such as commission fee or set up fee.
  • §  Make sure that you are currently a shareholder of a stock before you plan to invest in DRIP. Most of the companies that list dividend reinvestment stock require the investors be a shareholder of the stock. Therefore, it is highly recommended that you purchase an initial share. You can buy share through online brokerage account or through your broker.
  • §  After buying the share of your own, you are required to have them registered in your name in the form of a certificate. After fulfilling all these requirements, you can visit the website and start the investment process.

These ideas combine to offer you cutting-edge tips regarding how to trade DRIPs.

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