Mutual Funds, ETFs and Stocks DRIP

When it comes to collecting dividends and/or interest, investors will never see how much has accumulated over the years.  The reason is DRIP, Dividend Reinvestment Plan.  Therefore, for investors who own mutual funds, ETFs or stocks that have DRIP turned on, the interest and/or dividends will automatically be reinvested.

As a trader, I opted out of DRIP since I prefer to separate the securities I have purchased and the interest and/or dividends paid.  Furthermore, I can see more clearly if the security has gone up or down since the dividend and/or interest are deposited into my cash account.

You will see above that I have a margin and a TFSA account.  Furthermore, there is cash there.  This cash accumulates over time as the dividends and the interest are deposited when the security pays out the money.  Therefore, I can see how much I am collecting in cash from my securities which are ETFs, stocks and/or bonds.

For those who prefer to automatically reinvest the dividends and/or interest in the ETFs and/or stocks, you will have to ask your broker how it works exactly if they offer this service.

I am unsure if an investor can opt out of DRIP in mutual funds.


Leave a Reply