Investor Glossary-dripInvestor Glossary-dripInvestor Glossary-dripInvestor Glossary-dripInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

DRIP

The HTML to link to this page
 

DRIP is the acronym for Dividend Reinvestment Plan. In a DRIP, any dividends paid out by a stock are automatically used to purchase more of the stock. DRIPs are generally administered by the company itself. Bypassing brokers allows DRIP participants to buy stock without paying commissions. To increase participation in DRIPS, companies sometimes offer a discount to the market price as an incentive. DRIPs are a convenient way to implement dollar-cost averaging, which is a method of spreading the purchase of stock over an extended period of time. Because a DRIP is not administered through a brokerage, it is not possible to actively trade any stock held inside it. If it becomes necessary to sell the holdings in a DRIP, they must first be moved to a brokerage, which may take days if not weeks to complete.



Rate this DRIP definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: irrevocable trust, minority interest, Zero Cost Collar, 144a, open position, EBITDA, 1035 exchange, annual return, FICO score, phantom income, in escrow, diluted share, deferred revenue, real GDP, deferred tax, current ratio, FTSE, 1031 exchange, dividends payable, margin rate, stock market close, limit order, VIX, retained earnings, per diem, debt service coverage, class C shares, stock split, average price per share, ex-dividend, command economy, ex-dividend date, reverse mortgage, liquidity ratio, option premium, risk management, quality assurance, 401a, required rate of return, cancelled check, implied volatility, covered put, LIBOR, Key Rate Duration, labor relations, wholly-owned subsidiary, APR, balance sheet, inflation


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2016 Investor Glossary - All rights reserved - Terms of Use