Dividend reinvestment plan

• Abbreviated DRP. Automatic reinvestment of shareholder dividends in more shares of a company's stock, often without commissions. Some plans provide for the purchase of additional shares at a discount to market price. Dividend reinvestment plans allow shareholders to accumulate stock over the Long term using dollar cost averaging. The DRP is usually administered by the company without charges to the holder.

• Abbreviated DRIP or DRP. Plan offered by many corporations for the reinvestment of cash dividends by purchasing additional shares or fractional shares on the dividend payment date, occasionally at a discount from market price. Many DRIPs also allow the investment of additional cash from the shareholder, known as an Optional Cash Payment or Optional Cash Purchase (OCP). The DRIP is usually administered by the company without charges or only nominal fees to the participants, and many allow additional purchases of as little as $10.

• Plans that enable shareholders to use dividends received on the firm's shares to acquire additional full or fractional shares at no transaction (brokerage) cost.


Follow this link for all the terms related to dividendinvestment.

 Embedded terms in definition
 Cash dividend
Dividend reinvestment
Dollar cost averaging
Long term
Payment date
 Related Terms
401 k plan
403 b plan
457 plan
Average dividend yield
Baker plan
Cash dividend
Constant growth dividend valuation gordon model
Constant payout ratio dividend policy
Cum dividend
Cumulative dividend feature
Defined benefit plan
Defined contribution plan
Discounted dividend model
Dividend clawback
Dividend clientele
Dividend date
Dividend discount model
Dividend growth model
Dividend irrelevance theory
Dividend limitation
Dividend or dividends
Dividend payout ratio
Dividend policy
Dividend rate
Dividend reinvestment
Dividend relevance theory
Dividend rights
Dividend valuation model
Dividend yield
Dividend yield funds
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Employee stock ownership plan
Ex dividend
Ex dividend date
Extra dividend
Financial plan
Homemade dividend
Hr 10 plan
Indicated dividend
Keogh plan
Liquidating dividend
Long term financial plan
Low regular and extra dividend policy
Money purchase plan
Ordinary dividend
Overfunded pension plan
Pension plan
Perfect market view of dividend policy
Plan for reorganization
Plan sponsors
Potential average dividend yield
Price dividend will support
Profit sharing plan
Qualified plan
Qualified savings plan
Regular dividend policy
Reinvestment rate
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Short term financial plan
Signaling view on dividend policy
Small ordinary stock dividend
Special dividend
Stock dividend
Substitute cash or dividend payment
Target dividend payout ratio
Tax differential view of dividend policy
Traditional view of dividend policy
Underfunded pension plan
With dividend
Withdrawal plan

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