DRIPs/SIPs/Synthetic DRIPs

[runningman]

I just got off the phone with TDWH and requested a drip of XIC and they say it's not on their drip list, but XIC is. Why is this? Is there a good reason for it? The guy on the phone didn't know.

[Bylo Selhi]

I just got off the phone with TDWH and requested a drip of XIC and they say it's not on their drip list, but XIC is. Why is this? Is there a good reason for it? The guy on the phone didn't know.

I assume they told you XIU is DRIPable because they do DRIP mine

In any case, at TD WH, "NO" means "MAYBE." Until a couple of year ago, I thought I had to call TD WH every time I bought a new stock that I wanted to DRIP and ask them to set a flag in their system for that security. Then they'd decide on a security-by-security basis whether they could comply. When I asked about XIU they'd always tell me no, they don't DRIP it.

Then one day a helpful rep told me they also have an account flag that tells their computer to DRIP all eligible securities in the account. I authorized him to turn it on. Lo and behold, a couple of months later I notice that they've started to DRIP XIU. Of course, this will only work (if indeed it also works with XIC) if you want everything that can be DRIPed to be DRIPped.

As to "why"? The only answer I can think of is "because."

[Westford]

Well, I'll be...

I'm calling TDW tomorrow and asking them to put a flag on my accout and start DRIP-ing my XIUs. I didn't know they offered DRIP on it.

Thanks, Bylo.

[marcharry]

Can someone please explain what it means when they DRIP?

It is "direct reinvestment ...I.P.?" Does it mean that all dividends are directly reinvested to repurchase shares of the same? Without transaction fee.

What is the advantage? More efficiency & less fees?

[Westford]

Can someone please explain what it means when they DRIP?

It is "direct reinvestment ...I.P.?" Does it mean that all dividends are directly reinvested to repurchase shares of the same? Without transaction fee.

What is the advantage? More efficiency & less fees?

See here: http://www.investopedia.com/terms/d/dividendreinvestmentplan.asp

[marcharry]

That's a good resource - thanks

[ukridge]

It's perhaps obvious to many, but worth stating in this context anyway - the DRIPs offered by brokerages can't purchase fractional shares. This makes the DRIP useless for small number of shares.

Let's say you buy XIC. Let's say the quarterly dividend is 25 cents, and the price per unit is 60 dollars. Then you need to buy at least 240 shares to get any use out of the DRIP. (Maybe a bit more allowing for price increases).

Ukridge.

[Westford]

It's perhaps obvious to many, but worth stating in this context anyway - the DRIPs offered by brokerages can't purchase fractional shares. This makes the DRIP useless for small number of shares.

Let's say you buy XIC. Let's say the quarterly dividend is 25 cents, and the price per unit is 60 dollars. Then you need to buy at least 240 shares to get any use out of the DRIP. (Maybe a bit more allowing for price increases).

Ukridge.

The exception to the above is CSI which will reinvest fractional shares as per this: http://www.shareowner.com/iunits_services.html

[voltaire]

Well, I'll be...

I'm calling TDW tomorrow and asking them to put a flag on my accout and start DRIP-ing my XIUs. I didn't know they offered DRIP on it.

How did you make out with TDW and the DRIP?

[Westford]

Voltaire wrote:

How did you make out with TDW and the DRIP?

It worked out very smoothly. As per Bylo's suggestion, I asked the TDW's rep. to flag my CDN account so that all eligible securities are DRIPed. It took all of 30 seconds for him to set it up.

[CalgaryGuy]

I recently bought a REIT and called Scotia Mcleoud Direct to enroll me in the sponsored DRIP (One of the ones using ComputerShare). The guy said this was not possible. He did offer to enroll me in a synthetic DRIP but then I miss out on the extra 3% dividend and can't have partial units.

I had assumed enrollment in sponsored DRIPS were something brokers did as a matter of course....Does anyone have a discount broker that does this for them ?

[dersal]

I don't think any broker enrolls you. You have to first get the shares registered in your name and have the borker send them to you. You then have to got to Compushare's website and fill out a DRIP form for the stock that you are interested in. Send the stock and form to Compushare and then you are enrolled.

It does take quite a bit of time and when you want to sell the shares you have to get Compushare to physically send you the shares and then deposit them with your broker to sell the shares. Scotia Mcleod Direct Investing will enroll you in their own DRIP program that only buys whole shares but I think they do give you the discount on the shares.]

[blondo]

You don't send in the share certificate. Get the brokerage to register one share in your name and send it to you. This is fairly expensive and will cost $30+. Fill out the DRIP form with your name listed exactly as it appears on the share certificate. They will have a record of you and open the account.

When starting out and with little money you can get into several DRIPs and start a nice portfolio. As the stocks increase in number and value the day will come when it is easier to close the DRIP and transfer the shares to your brokerage account and start a synthetic DRIP. With a REIT that DRIPs monthly even buying partial shares will add up fairly quickly.

The Canadian Moneysave magazine has a very good section on DRIPing.
They used to list people who traded single shares with each other. Good luck.

[CalgaryGuy]

Thanks for the information, guys! I believe I understand now, and I'll have a look at the Canadian moneysaver to clarify the process.

[unicef01]

DRIP newbie here.... do alot of ppl purchase a single share via a brokerage acct to participate in drips ? I'm wondering what the most cost effective approach is ..

[Shakespeare]

See the following thread:
http://www.financialwebring.org/forum/v ... .php?t=369

[Shakespeare]

A grandparent's legacy (Star, registration needed)

For 14 years he used a small veteran's pension to steadily build up a stake in seven companies: Bank of Montreal, Bank of Nova Scotia, CIBC, Alcan Aluminum, Imperial Oil, Telus, and Molson.

[yielder]

This is a great DRIP site. Although a lot of the info is about US stocks, there's a non-US forum.

And this also.

[noromama]

Thanks for the heads up about the non-US forum.
I had missed it in my first cruise through the site.
I think that DRIP/SPP's are the way to go, especially
for younger investors.

[Tanstaafl]

Hi Looking for members for a share purchase club to buy the first share. There are 4 people already who are interested. Would like a few more to share in reducing the brokerage cost. So far the consensus is on BMO to start with. If anyone is interested in joining please email me at Rob100100@yahoo.com for details. Any suggestions or guidance would be appreciated.

[unicef01]

check your PM...

[angelocardoc]

Hi

Of all the Canadian banks to pick is there a reason why BMO has been choosen for this?

Is it because BMO has the best dividend payout?

[Qfinger]

is it because BMO has the best dividend payout?

Doesn't CM has a better yield than BMO?

[Tanstaafl]

Did not really have anything to do with yield or prospects or charts. Just that we settled on BMO because that is what 4 out of 6 wanted. Several want to get started on a drip program with CM and/or BNS as well.

If there is anyone who might have a share to spare for BNS, CM or CGI please PM if you would like to sell one or more. Can't offer anything yet to trade but will in the future.

[demann]

which index ETFs are DRIPable at TDWaterhouse?
Is there a list somewhere?