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GIVE KIDS THE
GIFT OF LEARNING!
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"Always sell what shows you a loss and keep what shows you a profit."
Reminiscences of a Stock Operator
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What happens to Dividend Payments when I Join a DRP Plan?
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Back to: DRP Fundamentals
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When you buy stock through a DRP Plan, you are a shareowner and have all the rights of any shareholder. So you are entitled to any cash dividends paid by the corporation on the shares you hold on a record date. Dividends are normally paid quarterly.
When you enroll in a DRP Plan, you typically have three (3) options regarding cash dividends.
- Full Dividend Reinvestment: Reinvest all dividends to purchase additional shares of stock.
- Partial Dividend Reinvestment: Reinvest any dividends on specific number of shares to purchase additional shares of stock. You receive a check for the remaining dividends.
- Voluntary Cash Payments Only: You receive any dividends as cash payment.
The option to purchase additional shares of stock through "Optional Cash Payments" is typically a separate decision. Regardless of the dividend option you choose, you will still have the option to make OCP investments whenever you choose. They will be invested on the "Investment Date" as specified in the Prospectus. Drop us an e-mail if you need contact information to get the prospectus.
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