DRIP

Itchy-Cat-8466

All depends on your goals ! I would look to strong ETF possibly dividends and turn on DRIP if you’re in it for the long haul. Don’t go all in at once ! Start small, can scale more in on pullbacks

stewliciou5

What is considered high yield nowadays? 3 or 4%? Not financial advice, but I would put it into a dividend portfolio with stocks with a looking consistent history of 6 or 7% dividens and enroll them in the DRIP program to snowball the dividends. Basically acting like compound interest.

OGsuperbear

Lindt & Spruengli AG with DRIP because I love chocolate companies.

Kratos113

What would you suggest to take advantage of compound interest if not VOO? I'm currently doing DRIP and the dividends are being reinvested. Just looking for a way to maximize the 15 year long term contribution

GamblingMan420

Compounding does not apply to stocks/index funds like it does with bonds/HYSA. There is no “interest” rate of them. The dividend’s will compound if you have automatic reinvestment turned on, also known as “DRIP.” The 5% annual return estimate will be for example, 1st year of a $100k investment yields $105k. 2nd year is 5% of $105k, so EOY return is $110,250, 3rd year $115,762.50 and so on.

WanderersGuide

As a Canadian, all dividends that I collect are tax free or tax advantaged vs. Capital gains. Having said that, the two biggest performers in my portfolio and the largest holdings I have are EIT-UN.TO and VFV.TO, the former an income focused fund and the latter an index fund that tracks the S&P 500. VFV has had stronger capital gains, but with DRIP they've performed about equally for me in the time that I've owned them. Currently, VFV is lagging, but the S&P 500 has been disproportionately punished in the current political climate.  I hold VFV in a tax advantaged retirement savings account, and I hold EIT-UN in my cash accounts where the payments are treated as eligible dividends at tax time. Keep in mind these are both stocks traded in Canadian dollars on the TSX. All that said, my value proposition is likely not the same as yours.

zooka19

Good Lord, I remember being invested in AEHR. Now my riskiest stock is SOFI. Slightly red, but I'm not adding any more to it via DCA or Pie DRIP.

Acesonnall

Component How we got there Dollar value (today, 3 May 2025) Current Boeing shares 10 McDonnell Douglas (MDC) × 1.3 BA per merger agreement 13 shares Market price BA last trade ‑ $185.46 ≈ $2,411 Cash dividends you’d have pocketed (1997‑Q1 2020) Σ annual dividends per BA share 1997‑2020 = $52.71 × 13 shares ≈ $685 TOTAL cash you could have today (no reinvestment, pre‑tax) — ≈ $3,096 If you’d re‑invested every dividend through the DRIP you’d own ~16 BA shares (rough calc using ex‑div closing prices), pushing the market piece to ~$2,970 and the all‑in total toward $3.6 k; still the same order of magnitude. How I got there Merger math Final exchange ratio was 1.3 Boeing (ticker BA) for every 1 MDC share; it was 0.65 until Boeing’s 2‑for‑1 split in May 1997 doubled it. So your 10‑share certificate became 13 BA shares. No further splits on BA after 1997. Market value Latest BA quote is $185.46. 13 × 185.46 ≈ $2,410.98. Dividend stream (if you took the cheques) Boeing paid steadily until COVID shut it off in 2020. Summing annual dividends 1997‑2020 gives $52.71 per share. $52.71 × 13 ≈ $685. (If you missed a few cheques, adjust accordingly.) What if you’d DRIP‑ed? Reinvesting quarterly bumps your share count 25 % (rule‑of‑thumb using actual ex‑div closes). That’s why the fully‑compounded total ($3.6 k) isn’t life‑changing either. Don’t let anyone sell you on “hidden fortune” fantasies. Collectible (‘scripophily’) value Ordinary post‑1970 McDonnell Douglas certificates trade $10‑$40; pristine “specimens” can hit $300+. Your 1995 issue with punches/ink is toward the low end. Nice wall art, but financial value = share value unless a collector overpays. Cashing in / putting it in street name Issuer & transfer agent: Boeing’s agent is Computershare Investor Services. Call them (888‑777‑0923) or open an Investor Center account. They’ll walk you through registering the old certificate, medallion‑signature‑guarantee, replacing lost coupons if any, and depositing to a brokerage. Expect a $25–$50 fee for replacement or DRS transfer; negligible relative to the $2.4 k stake. Tax angle If this was inherited, your basis may be date‑of‑death FMV. If it’s yours since 1995, original basis carries into BA (basis is split 50/50 between the 1.3 shares received & cash‑in‑lieu for any fractional share you may have had). Dividends already taxed in the year received; if you never reported them, you'll want to look into what's needed. All in all... You’re not sitting on a secret gold mine—roughly three grand gross, maybe enough for a weekend trip or a chunk off a credit‑card bill. Unless you love the nostalgia, dematerialise the paper: theft, fire, or simply losing it would be a 100 % loss. If you want to stay invested, move the shares into a brokerage via DRS; if not, instruct Computershare or your broker to sell and wire the proceeds. And if you think aerospace has long‑term upside, remember BA hasn’t reinstated its dividend yet and is still digging out of 737 MAX/legal holes. Keep your eyes open. TL;DR – About $2.4 k in stock, $0.7 k in past dividends; call Computershare, get it registered, decide whether to hold or sell, and don’t expect yacht money.

RJ5R

After dot-com crash and after I landed my first job The guy in the cube next to me said to shovel every penny into the S&P 500. I thought he was crazy after the dot-com crash. He said just do it, and you will retire a multi millionaire. So that's what I did, I went with the S&P 500 index in my 401K, went with the S&P 500 in my Roth, and then later in the 2000's when the HSA went mainstream I went 100% S&P in that too. I just stuck with it out of laziness. Even during the throws of the '08 and '09 crisis, I continued just doing 100% S&P 500. Fast forward to today. Let's just say that I am sleeping like a baby. I tried stock investing....dabbled here and there, won some. Lost some. Won some more, lost a lot, won more, etc. Got boring and I didn't like how I didn't have any control. So starting in 2010-2012, I began investing in real estate. Had full control of that, and leveraging the debt seemed like a no-brainer. Also learned how to be handle. So that's what I did. I still own a handful of winner stocks that have paid off very well long term, mostly large cap....microsoft, walmart, travelers, etc. they are just on auto DRIP forever I guess. But my main "stash" is in good old boring index funds, and almost $10M of real estate now

zooka19

SOFI opinions? I've gone neutral so I'm gonna hold. Not gonna dca and took it out of my pie for DRIP.

pintord

DRIP to the moon!

Haunting_Ad_6021

DRIP or dividend reinvestment

stickman07738

I have investing HON since the late 1990's via their DRIP - initially $100/month then switched to $500/quarter added extra from my bonuses and sold previous spin-offs (ASIX, REZI, GTX) and rebrought parent. By far my largest individual holding. Only sold once (100 shares) during Covid to remodel the kitchen. Probably not touch anymore but give to heirs to get stepped-up cost basis.

L_DUB_U

If you aren't close to retirements, just keep buying. Right now your account value may be dropping but as you continue to buy shares and continue to DRIP, you will just accumulate more shares that will be more valuable in 20, 30, 40 years.

AndyMcDandy00

You’re not an investor. You’re a gambler. At least you can write off these gambling losses. Sell what’s left, move to SP500, leave it alone with DRIP and come back in 20 years.

Babinio

Look into $MSTY instead brother! You do weekly investments and reinvest your dividends with DRIP and watch your money grow faster than you’ve seen before 🫡

Icy_Brilliant_2099

Hey you win some you lose some kid. You could just as well be up 40%. It gets better imo dollar cost averaging a diverse port. Some w dividends, DRIP, crypto ofc, and options is big risk big reward. I’d say hold main strong cryptos, don’t look at em constantly.. try forgetting it set it up to buy daily, DCA. Same w stocks and then only watch your options calls or shorts. Best of luck.

AICHEngineer

Correct. If you go to the performance tab on these ETFs, theyll show you "growth of 10k" historically and these ETFs just look like a flat diagonal line. Their yield is tied to whatever the current SOFR rate is (federal funds short term lending). It will be that minus the expense ratio. CLIPs expense ratio is 7 bps. SGOVs is 9 bps. It is important to turn on DRIP with these, otherwise the dividends will sit as cash. That wouldnt be terrible, often your core cash position in a brokerage is set to some money market sweep fund, so youd still get yield. For example, SPAXX is the default fidelity cash sweep MM fund, its 30-day SEC yield is 3.98% cagr currently. But, if you were in CLIP, your 30-day SEC yield is 4.18% and the yield is state tax exempt unlike SPAXX. If you had a state income tax of 5% like illinois has, your net of state tax yield on SPAXX drops to 3.78%.

Parabolic30M

I agree, but that’s more shares that you can buy when the market is pulled back. I would just think of the ability to buy 20% more shares of AAPL (or AMZN, etc) 15-20 years ago. Massive capital appreciation on those shares would be 100% missed. If it’s a company that raises its dividend frequently and is put into a DRIP, no doubt missing out on the compounding of those shares (that you unfortunately don’t own) would come into play.

ra__account

Yes. I got tripped up by this last year - I thought I'd turned off DRIP but ended up missing out on a couple hundred dollars of tax writeoff because I bought $5 or so automatically. Live and learn.

pintord

Oil is dead DRIP to the moon!

JPete4985

My dividend allocation for my portfolio is 50% SCHD, 25% JEPI, 25% JEPQ. I'm astonished how well JEPI and JEPQ have done in this market down turn with their selling calls strategy while also paying me 8% and 12% monthly dividends. They actually have higher growth and less downside in this downturn as well. Both are up a percentage point or two, while schd is down 1-2%. Long term I like the balance I have and will continue doing that for the next 30 years for my dividend section of my portfolio. JEPI and JEPQ get a bad wrap for limited growth potential... but at the end of the day if you are using DRIP and reinvesting the dividends you are getting a blended rate of 10% growth annually when splitting 50/50 as you are aquiring "free" shares in a tax advantaged account. JEPI and JEPQ make far less sense outside of an IRA tax advantaged account, they are great in a 401k, IRA, and they super charge any ROTH.

BuildingWithJon

Well... I didn't buy any MILF myself... But I did marry her. Would that be considered a recurring investment order or a DRIP?

occurious

You have a number of things wrong. And DRIP as a core portfolio strategy is out of date by 20 years. Dividends don’t circumvent contribution limits. They are growth, not contributions. Second, dividends don’t increase your balance. The value of the stock or fund will drop by exactly the amount of the dividend, leaving you with the same total $. A dividend is just a forced sale. Third, in the long term dividend stocks underperform the market average. For long term investing only total return matters. Dividends are only one part of total return. Fourth, dividends matter even less in an IRA because selling is not a taxable event. In a taxable account you’d have to sell an existing position, realizing its gains, to switch into dividends at retirement. In an IRA no gains are realized so it’s a completely free exchange. So there is no reason to focus on dividends. Ben Felix has an excellent YouTube video “The Irrelevance of Dividends”. If you want a good baseline to evaluate portfolio strategies, learn about the Boglehead three-fund portfolio.

gentlegiant80

Options are very complicated. Wouldn’t touch them unless you knew what you were doing. Only invest money you’re not planning to touch for 5-10 years. There are plenty of funds with long-term performance records and should be fine despite the craziness. If you think you might need some money in the next couple years after college, put that in a money market or HYSA. If there’s an amount that you could put aside and not miss for a few years, invest and index fund (VTI, VOO, QQQ) set it to reinvest (DRIP) dividends and leave it alone. Should do fine.

L_DUB_U

This is my thinking. Going to let it ride out. Not doing anything drastic like pulling all my money out or putting all my money in. Making buys here and there and letting my DRIP do its thing. I could stay like this for 2 more days or two more years.

ladyvirg

Your child will have a fantastic start to their adult life from you doing this. Great job!! Both funds overlap in terms of their holdings. Dont worry about the buy price  now or as you make deposits / DRIP. You can buy at the short term "top" and it immediately goes down for the next 2 years. What happens? DRIP and deposits lower your cost basis and when it recovers ( a few months to a few years even) you will have gains on a larger amount of money at a lower break even. The interesting question is which to choose / or even pick something else entirely. Thats honestly up to you. Its hard to beat "the market" (VOO) consistently over a long period of time.  Like i said, both share top holdings so buying both makes little sense and can unintentionally overly expose yourself to one industry or a few stocks (like apple, nvidia etc). Its not a bad thing but it is simpler to choose a fund that fits your needs.  Just be sure to research the etd you end up choosing. Schg focuses on stocks it labels as "growth" as well as having a large market cap. One holding i did not see as a top holding with a position is brk.b if that matters to you.

garden_speech

> If someone just buys a stock for eventual dividends, DRIPping until they are ready to collect them, and doesn't sell the stock, they aren't collecting a actual "return" until they start collecting the dividend. This makes zero sense. Return is not dependent on your motivation or what you do with the return, it is return either way. > Never having heard of this? I own stock worth $100, at close before the ex-date. I acquire the right to the dividend, and it's subtracted from the spot price before the market opens. Ignoring whatever the price itself does due to other things, once the dividend is paid, you still, between cash and value of the stock, have $100. This is really basic. ... See, now this is paradoxical. You are simultaneously arguing above this that "return" from dividends isn't return because it's not "money" it's just more shares, and then just after that, arguing that a dividend is not "return" because *when you receive the dividend, it's cash value is subtracted from the price of the stock, naturally, since it's public info*. This argument is, in and of itself, admitting that what matters is the value of the position as a whole (stock owned + cash). > I'm well aware most people who work in finance don't think that way, because they think in terms of "pairs" of trades.... buying something and selling it later No, this has nothing to do with anything. It's as simple as: ROI is the price you paid -> the value of your position now. It has nothing to do with shares, nothing to do with dividends, just he position. It could be a futures contact, it could be an options contract, it could be shares. Let's try it this way. I intuitively agree with you that the moment you receive a dividend, you have not received "return" because the dividend itself is subtracted from the price of the stock. All that's happened is the composition of your position has changed -- you now have extra cash and less stock. Okay, so my argument is as simple as this: anyone quoting returns from stocks while ignoring dividends is fucking stupid. Even if you want to take the position that DRIP is simply acquiring more stock... That means that the person who's quoting returns without dividends is *quoting returns that ignore the fact that you acquire more stock simply by holding the stock*. Everything else is definitional and superfluous.

Reventlov123

Let's take this really, really slow... If you buy a stock, you have to pay money for it... that's "cash flow in." If you take the dividend as money, you actually get a return... "cash flow out," in exchange for the original cash flow in. If you take the dividend as shares (you DRIP it) there is no net cash flow. You don't take money out, so there is no return yet. Instead, for the same original investment, you own more shares. Your average cost per share went down. You don't actually get a "return" from the investment until you actually get money back. Just, wow....

garden_speech

> This varies depending on whether you are taking the money or compounding it as new shares. You only earn the "published" dividend yield if you DRIP Right... Because that's the default and logical position if someone wants maximum ROI on a stock

Reventlov123

This varies depending on whether you are taking the money or compounding it as new shares. You only earn the "published" dividend yield if you DRIP, against the number of shares you own. If you are doing that, then for a fixed $ dividend per share, your investment compounds *shares* faster when the price is lower. This gives you more exposure to future price movement, for the same amount invested, so less future upward movement is needed to bring you back ahead... it happens sooner. You guys are talking apples and oranges.

pintord

r/oilisdead DRIP to the moon!

west-coast-engineer

O (Realty Income). Super solid DRIP play.

RetiredByFourty

Just keep shoveling money into SCHD/SCHG and ignore the noise. You'll be just fine. Don't forget to set the dividends to automatically DRIP. +1

greenpride32

3rd this. Years ago I used to DRIP some dividend payers I bough during the 2008-09 rout. Some of them (such as MCD and KO) did better in capital appreication than others. But my lesson learned was if a basket (such as SCHD) exits, it was better to just park it there. I still get my dividend yield, but no single company can take my capital down. Other stocks I picked are still up - but I think SCHD would have outperformed them (couple of examples were KMB and SJM). Now if I really like the individual company, I'll still buy their and hold their shares outside of SCHD (such as MCD).

Additional_Bug_6449

If you have the extra money after paying all your bills, it's a great way to start a portfolio. In my opinion life is a gambling in everything we do. You can always buy stocks in something that's pretty safe maybe look into a stock that pays dividends, might be something boring like for example Coca Cola (KO) but if you look at the end game pay into a DRIP (Dividend Reinvestment Plan). It will work out in the long run no matter which way the market goes.

1dirtbiker

Buy SCHD. This ETF will also dip with the market, but historically smaller dips, and the strong dividend set on DRIP will buy more shares when the prices are down. 

ColorMonochrome

I use both Merrill and Schwab. Schwab is a legacy situation I kept around for various reasons. Schwab, IMO, is comparable to Fidelity. As for IRA’s theres zero difference between Schwab (and Fidelity) and Merrill. I would never trade in my IRA account and I would never invest in exotic securities in my IRA account. So my IRA account is limited to the most boring inactive vanilla transactions imaginable. As such, for me, there is absolutely zero difference between a Schwab/Fidelity and Merrill. I execute a couple of orders every quarter in my IRA account and that is to reinvest dividends, which could be automated through DRIP (dividend reinvesting), which I choose to do manually. I see absolutely no difference between them for my purposes.

zooka19

Exactly what you said, I've bought back in some tech stocks at the top, but I'm not worrying, I have DRIP turned on and two pie charts. So the dividends from each pie DRIP into all the positions as per their allocations. Funny you mentioned Buffett because BRK.B is one of my defensive stocks and it's doing very well.

Financial_Injury548

OOOOOHHHHHH ITS THAT BIG DRIP https://preview.redd.it/mx1wftfezoue1.png?width=1184&format=png&auto=webp&s=4571fc9acb2c355e6272254965615504e3bd6a35

Happy_Discussion_536

Read this: More detailed older comment: Trillions will flow from buybacks, divvies (DRIP), 401+company match, new savings, pension funds, endowment funds, equity-mandated funds. Until there is an actual liquidity shock. They will win a Nobel Prize at some point and these economists have figured out why markets actually go up and down. It's called Inelastic Market Hypothesis. The Inelastic Market Hypothesis is a theory proposed in 2021 by economists Xavier Gabaix and Ralph Koijen that challenges traditional views on how stock markets function. The key points of the theory are: >1 - Markets are surprisingly price-inelastic, meaning that flows in and out of the market have a significant impact on prices and risk premia. >2 - A small change in demand for stocks can lead to a much larger change in stock prices. Specifically, investing $1 in the stock market increases the market's aggregate value by about $5. >3 - This inelasticity is primarily due to institutional constraints: >* Many investment institutions have limited flexibility to adjust their portfolios in response to changing market conditions >* Most institutions maintain relatively stable equity shares due to rigid mandates >* There's a shortage of organizations that can effectively arbitrage away mispricings caused by inelastic demand >4 - The hypothesis challenges the efficient market hypothesis by suggesting that stock prices don't necessarily reflect all available information and that prices can move significantly due to non-informational factors like fund flows. >5 - Under this framework, flows become a critical market indicator. Factors affecting flows, such as stock buybacks, changes in the labor force, or demographic shifts (e.g., Baby Boomers withdrawing from retirement funds), can have outsized impacts on stock prices. >6 - The Inelastic Market Hypothesis suggests that market volatility is largely driven by trading activity rather than changes in fundamental information. >7 - This hypothesis applies not just to stock markets, but potentially to all asset classes. >The theory provides a new perspective on market dynamics and could explain phenomena like why markets can appear disconnected from economic fundamentals at times. It also highlights the importance of understanding capital flows for predicting market movements. Published 2021 - "In Search of the Origins of Financial Fluctuations: The Inelastic Market Hypothesis" https://www.nber.org/system/files/working_papers/w28967/w28967.pdf Published 2022 - "The Inelastic Market Hypothesis: A Microstructural Interpretation" https://arxiv.org/pdf/2108.00242.pdf

Party_Character_4080

Buy 9500 shares of MSTY and bring in 13k a month in extra income. DRIP if you wanna, or gamble 7500 of it and save the extra for taxes.

xiongchiamiov

Yes, I understand. My point was that if you DRIP, you'll come out ahead regardless of taxes.

Reventlov123

People invest in, say VOO. They DRIP like they are told. They get new shares. These cost of these new shares doesn't make the value of their account go up (it comes out of the spot price) but their TAX basis goes up. The new shares are shown by the broker as if they were newly invested money, when they are not. You basically only see "green" as long as the market keeps going up, even though you are "ahead." As soon as the market drops, you see "red" long before you have lost anything but unrealized gain or previously realized gain, and lose your shit, because the broker tells you that you invested more than you really did.

JoJo_Embiid

that's assuming you all in during the peak, which is hard even for paper hand guy. if you just dca your paychecks you should see average 50% face value return plus 150%-200% DRIP return just based on the graph. not serious calculation here but you get the point. Definitely not as good as the US market but some what a decent and expected return for an average mature market. In the same period, UK gdp increase 74%, CPI increase about 80% (wow, just noticed real gdp growth is almost negligible for UK), I believe bond won't be doing great because the majority of 2010s short bond yield is below 1%... So in short, in a world that the US market does not exist, keep invested in London Exchange is still better than holding cash or bond for an average Mike in England in the long term. Or, if they hold VT and chill, they'll do even better

Reventlov123

If you are DRIPping dividends from an investment, you are basically always DCA in (to a degree). If you are always DCA in to that investment, it is sub-optimal to DRIP. Instead, just collect interest (money market) on that dividend and DCA a bit harder to catch up.

Kazko25

4% yield. So with $170k you’ll just make about $7k a year, and then if you DRIP it back into itself you just make compounding more money each year.

cosmos_jm

Follow-up question - what if the dividend-paying stocks DRIP at NAV at a significsnt discount - is it possible to leverage that?

Reventlov123

Money just quantifies the value of "stuff." If the spot price of your stock goes down, you still own the same number of shares. You haven't actually lost anything. The "exchange rate" back to actual cash just moved. DRIP more "free" shares and wait for it to move back up. It will, people are greedy.

pigglesthepup

The market will be histrionic, just like Trump. I'm setting aside what I need for the next few years. Will probably sell out of my remaining individual stocks when everything recovers and stick with index funds and turn on DRIP.

Reventlov123

The short and simple version. Save money in your brokerage accounts money market fund. Every time you get paid a dividend, buy that much of your preferred index ETF. DRIP any dividends from the ETF. DCA more in at a sustainable rate from your income (to invest) but also "save" some as fixed income, to lower risk. Don't sell low. Wait if it's low, just pull out fixed income as it matures, until the market comes back up. Profit.

Reventlov123

DRIP the dividends from your stocks until you have "too much" at risk in the market, then start buying more fixed income with the dividends to balance it back out.

MomGrandpasAllSticky

🦅 THE PATRIOTS CHOICE DRIP 🇺🇸 All these IV clinics were there just to slowly normalize it. It all makes sense now.

Reventlov123

If you are investing, you don't actually care about market movement. You are buying the right to a specific future dividend, at the dividend yield that you actually paid, and only doing so with companies that you expect to keep paying it. As long as they keep paying the dividend, you are earning that yield, on that chunk of shares, "forever". Since you DRIP, that original investment gets compounded, so your "effective" dividend yield goes up over time. If you are a smart investor, you do all this math ahead of time, use limit orders, don't enter an order that won't give a result you will be happy with, and forget about how much better you could have done by timing the market.

Reventlov123

To do this "even better", DRIP your dividends, but don't count those purchases against your average cost per share. That wasn't new money you invested, it was profit, and doesn't change the amount that YOU have invested in actual money. Use these numbers to keep track of your total return (money you actually put in vs spot price) and those scary red numbers will go away.... the broker is tracking the tax basis, not your actual basis of new money invested.

zooka19

I've just set DRIP on my pie chart, to go into all my holdings as per their target %. That and my monthly DCA should make a nice snowball when we go back up.

bullmarket2023

The S&P is not a meme stock. You don't HODL, you set it, DCA it, DRIP it and come back in 30 years. You are on the investing thread, not trading.

Frosty-Buyer298

Stocks go up and then they go down. It has been happening for 200 years and will continue to happen for the next 2000 years. Most people's 401k plans are in DRIP accounts so their dividends and distributions will dollar cost average at lower prices; essentially everyone is buying the dip.

Reventlov123

You don't extract gains on a bump by timing the market, you set a limit order at the price that will be worthwhile, and just let it happen eventually. The trick is to always be doing this when possible, instead of leaving a huge amount of unrealized gains (which don't compound) at risk. Even if you roll it back into the same stock, you are compounding the number of shares you have just like a DRIP does, while not investing "new" money, which will magnify the effects of future price increases.

Reventlov123

Yes, the correct way to "buy the dip" is to DCA through the dip, use trailing stop limits (or covered calls) to realize your paper gains on the other side without "timing" it, and then DCA that back in (pay yourself a dividend out of the price return, and manually DRIP it back in, essentially).

Reventlov123

Paper gains (or losses) don't compound, but reinvested dividends do. Holding across the dip (assuming this is a company that can keep paying their dividend) and DRIPing will compound the number of shares you have by the dividend yield on that day... which is higher during the dip. This multiplies your gains when the market comes back up. Also, if you continue to DCA/DRIP, you will eventually bring your average cost per share back below the moving average (especially if you DRIP) and be able to at least break even if the stock stays down, unless it completely implodes. Don't sell a COMPANY because the market itself is down... because of mutual funds and arbitraging supercomputers, every stock in the index drags the others around a bit, even in a normal economy.

Reventlov123

The only time to "sell" (optimally) is on a bump while DCA (using a limit order) in order to pay yourself a dividend on unrealized paper gain, and then DCA it back in (assuming your end goal is more shares).... essentially, DRIP by hand.

A-C_Watch

Elon said this would happen. He also said it would come back stronger after a year or so...I cant find the reference but remember the interview. What's interesting is just a out every stock I ha e fell yesterday except DRIP. I've searched all over reddit to find talk of it but all I find is the reinvestment planning talk. It's like nobody knows this stick exists. When oil goes down thisnstock goes up. I hope this is the 1 that keeps my portfolio balanced through this mess.

Macademi

Same, mines a divi stock approach with like only 3 "capitol gains" tickers, so I'm coping that this'll just be "cheaper DRIP investments" for me......

Lingweenie2

Main thing to consider is America has had some damn rough times and has preserved. I still have an awful lot of hope despite the ultra pessimism. We’re a vast and growing nation. I’ve traveled around much of the country and there’s just so much more potential for the future. I know Trump is a bunghole. And he’s very polarizing. I just think too many people who hate him focus too much on the hate of him and get blinded by anything else that can be even remotely positive. People need to be an investor. And invest in what will endure for years to come. Not focus on political commentary and headlines in the here and now. All this stuff will basically be forgotten in everyday life 10, 20, 30+ years from now. Way too many people are just giving up and succumbing to their personal hatred and fear. I grapple with my deep frustration also. But I’m still going to do the proper investment strategy. Buy strong companies, hold, buy more/DCA, and DRIP, then repeat. This formula has stood the test of time. And I’m not going to be the one to throw in the towel and go against everything that investing truly stands for.

A-C_Watch

Ok...I just made good money on this stock...DRIP! It's basically a hedge against the price of oil. As oil goes down, it goes up. Warning: I own this stock and everything I own crashes. Do your research.

trogdor1234

Edward jones charges 2.5% for $6k of stock sold. I think they charge 2% of the DRIP. It’s insane. You should be selling when you figure out there is likely more future value in something else. Of course taxes complicate things.

10baggerbamm

Welcome to the world of investing You're not alone number one Most every bobblehead that's on TV that runs an ETF they are getting their asses handed to them as well and some of these people actually are fairly smart. What you cannot do is sell a loss go to another position that hasn't sold off yet because there's a high probability that stock will break its 200 day or 250 day moving average and it's going to get hammered another 10 or 20% after it gaps down. You need to make sure the companies you own number one are profitable number two have cash in the bank number three are not highly concentrated with one customer representing like 80 or 90% of their business. Ideally the companies that you are in are growing the earnings growing their revenues and most importantly increasing their margins. If you bought because somebody else gave you a hot tip you're probably fucked sorry to be so direct but that's generally the case. If you're chasing momentum something that's only going up 45° because everybody's bought the dip these stocks like App hims, and many others they're disposable they are going to come back down they're going to wipe out their whole bubble of momentum and they'll come back down to just at or slightly above where the run started. I got almost 40 years doing this now and I got hammered the past two days aside from a large inverse position DRIP, VIRTUALLY EVERYTHING LONG WENT DOWN AS THEY SAY IF YOU'RE ALONG YOU'RE WRONG. YOU NEED TO UNDERSTAND WHAT TRUMP IS TRYING TO DO. I've been up all night long reading what other people think and I'm not targeting somebody that's a Democrat or Republican I could give a shit I'm looking for an understanding. I'm trying to make sense and I just finished writing an article called diary of a madman or master plan. If you want to see the link you can go to my profile here on Reddit and I'll post it to my account I'm not too active on Reddit but I do get updates and I saw this post and I wanted to respond because losses are very real in the market right now. The emotions of losses can range I've had friends commit suicide over losses in the market I've had friends drink themselves to death. I've had friends who have gone through divorces because of losses in the market. So you have to be able to manage that emotional swing because you go from euphoria to a piece of shit very quickly. So I'm going to post the link of a video and some commentary the video is almost 24 minutes long it's not mine it's an individual has a very strong economics background he posts on YouTube and I think he might be spot on. Good luck to everybody thank you for your time.

rackoblack

Less than some, more than others. Retired with plenty, still have plenty. And I'm buying more with every DRIP. Rebalanced a bit today so putting money into markets on the current dip.

zooka19

I have two pies: Growth - 80% broad market ETFs (1/3 growth, 1/3 sp500 1/3 dividends), 20% Growth stocks Defense - Same ETF spread, and 20% defensive stocks I'm gonna lump 1/3 in on Monday into defense, and keep dcaing into until the foreseeable future. I'm in this for 30+ years so I'd rather set and forget, and let the divs DRIP even if things look horrible.

Flamingstar7567

That's what I did back in 22/23, personally I recommend focusing on dividend stocks, especially monthly dividend ones like MAIN and STAG, it's a great way to build cash flow especially now that most of em are gonna be pretty cheap. Turn on DRIP aswell and it'll help build a great portfolio.

Kazko25

Yes. However, the best way to set it up is to DRIP your dividends, or to have your dividends automatically reinvest when you’re paid out.

Lingweenie2

The game never changes. Buy, hold, DCA, DRIP, repeat. Some greats ETF’s and companies have gotten hammered. Not a bad idea to do some buying on a day like this. But you can’t exactly guarantee it’s done with. Buy low. Sell high. (Well I’ll just keep holding anyway but you know what I mean.)

zooka19

I have two pies in one portfolio, both pies are 80% broad market, 20% are single stocks. One is growth, one is defense. I will just pick which one to monthly dca into depending on market conditions, I'll be dcaing into defense on Monday. That way, overall I really don't care since majority of the cash is in a basket, and my DRIP still feeds into my ETFs & stock picks. Why panic and still try to hit a home run on the next meme boomer?

rendumguy

>What ways don’t I like him? I mean he’s a felon. He has his Elon and DOGE nonsense. The J6 and election lies. The Obama birther junk. His garbage crypto and stock. Peddling merchandise. I can write a book on all my reasons I dislike him. contrasted with: >Pretty lame to fall over yourselves and freak out over tariffs. This crap can easily blow over and work itself out. That’s my expectation. It’ll be a mostly nothing burger. Doing this would literally be political and economic suicide. They aren’t going to go full idiot like that despite your perception of them. There’s still many tailwinds out there. I ultimately am a firm believer in American business/innovation/technology. People are caught up too much in the politics and headlines. Too much emotion and fears. Trump has been on a roll, doing a slew of nasty unjustifiable shit yet he still seems to at least always have 40 % approval, even when he does politically stupid shit.  And nobody wants to stop him since the people he put in love him so he's gonna keep doing this shit. >What I think of a politician isn’t going to change how I invest. I buy, hold, DCA, DRIP, and repeat. If the market goes down, I’ll just buy more into weakness. Literally what I’ve been doing for years. If people want to panic and sell out and take a ‘wait and see’ approach have at it. I’ll be doing the same thing I always have and always will. That’s what the long standing conventional wisdom has always been. And I’m not letting politis override that. Well that's stupid, it's in the name "politics", "policy".  The dude is *by definition* affecting economic policy and you don't think that's affecting the stock market, when it goes to shit everytime he causes another disaster? I hate this shit, why do so many people not realize that *everything* is affected by politics.  You can't just shut your brain off and ignore it.

Lingweenie2

What ways don’t I like him? I mean he’s a felon. He has his Elon and DOGE nonsense. The J6 and election lies. The Obama birther junk. His garbage crypto and stock. Peddling merchandise. I can write a book on all my reasons I dislike him. What I think of a politician isn’t going to change how I invest. I buy, hold, DCA, DRIP, and repeat. If the market goes down, I’ll just buy more into weakness. Literally what I’ve been doing for years. If people want to panic and sell out and take a ‘wait and see’ approach have at it. I’ll be doing the same thing I always have and always will. That’s what the long standing conventional wisdom has always been. And I’m not letting politis override that.

nathanhamilton82

For many, it makes sense to max out ROTH ira contributions since there aren't taxes on gains or dividends. For context, here's a scenario estimate: **Roth, $20K for 32 years at 8% annualized growth, DRIP enabled, no taxes** * Ending value: $290K * You'd owe taxes on roughly $190K of gains and dividends in a taxable account. * [Calculator link to your scenario](https://dividend.watch/dividend-calculator?S-SPY-NYSEARCA=36.11&additionalInvestment=0&currency=USD&horizonYears=32&priceGrowth=8&reinvesting=true&sharelink=true) Your situation will vary significantly based on assumptions, but that's a big tax burden invested in a taxable account.

nathanhamilton82

ETF diversification is important, so even 2-3 holdings is reasonably concentrated. It's hard to say specifically what % should go in any scenario, but Schwab and Vanguard ETFs are some of the best options out there with their balanced costs and performance. I input your scenario in a [dividend calculator](https://dividend.watch/dividend-calculator?S-VOO-NYSEARCA=137.38&S-VXUS-NASDAQ=323.39&additionalInvestment=0&currency=USD&horizonYears=45&priceGrowth=8&reinvesting=true&sharelink=true) and here are the results. * Time: 45 years until retirement * 70/30 split into VOO and VXUS for $100K total * 4% dividend growth rate * 8% annual share price growth rate * DRIP enabled, no dividend taxes assumed, but you may need to be depending on the account type * Portfolio @ 65: $4.09mm * Dividend income @ 65: $9.6K A Roth account will save tons on taxes if you qualify.

Soggy-Bad2130

No need for a lot of new investments. Share price has gone down a lot so it would be a signal to shareholders that there is still value. income attracts a different type of investor as well. if the money is not needed for growth or maintaining the company then that money is best served by paying it out to shareholders. those that want to lower exposure will get paid out. those that want to increase will DRIP.

wjnpro123

I remember seeing someone posts about their cost basis go up without DRIP or buy more shares. This could relate?

VicTheSage

Depends on where your income comes from. Healthcare, discount grocery stores, fast food, alcohol, tobacco and marijuana are pretty much the only industries that thrive during recessions. If you work in one of those industries, are well liked by your superiors and won't be at risk of being laid off then there's likely a lot of money to be made by opting into DRIP and dollar cost averaging into a very diverse portfolio. You will get fucked in the short term but 5-10 years out you'll be making huge money as long as you can manage holding and dollar cost averaging into your assets for the entirety of the recession.

pintord

I own my house with no Mortgage. I own and have in my possession Silver, the metal. Also SQQQ and DRIP to the moon.

pintord

I'm calm SQQQ and DRIP to the moon! Tech is useless and oil is dead.

El_Loco_911

Just buy a high dividend yield stock portfolio DRIP and forget it. Way less work and fees

omgpuppiesarecute

Based on comments it definitely sounds like the issue was the money laundering more than drug use. Some options: 1. Consider real estate investing. 2. Create a trust and have the trust be the owner of the accounts. 3. Consider direct investment plans. This will take some legwork but many companies will allow you to purchase shares directly. Some also have automatic investment accounts that then generate dividends that are reinvested (a true DRIP). In those cases the only parties involved are you and the business.

pintord

Not just Warren Buffet. Silver Stackers too. And full regards like me who have been holding on to SQQQ and DRIP since 2021.

TizzyHizzy

This is literally the only good answer if OP is set on 3000k/month. All these dividend stocks lag behind the S&P even with DRIP, I can’t imaging how atrocious the return is without DRIP. People forget that when a stock gives a dividend it decreases by the dividend amount. You literally take a % loss each month (or whatever the dividend payout frequency) and the stock has to rebound. Just cut out the middle man and do it yourself.

eroseahawks

JEPI and QYLD. Monthly high dividend derivative ETFs. I DRIP currently but plan to switch them to dividends during retirement to supplement 401(k), ROTH and brokerage.

Bobby-Firmino-Legend

I just figured the money glitch. Invest $10k in MSTY set DRIP. Over $1m in ten years, conservative dividend assumptions.

Heyhayheigh

Doesn’t matter where you have the cash equivalents, they can all be thought of as a big pie. Depending on your level income and how optimized you want to be for your particular situation, you might want to consider an advisor. Make sure to find an honest ethical one that shares your common sense approach (stay away from annuities salesman). The “hedge” against downturn has a recency bias indicating not much of a hedge (fixed income and equities both tanking at same time lol), but I get the theory behind it, and for managed portfolios with systematic rebalancing, maybe tax loss harvesting, sure. For simple, do it yourself, keep the SGOV separate and let the DRIP roll. Sounds like you will do great either way!!

IggysPop3

I thought the same thing. I bought into it about a year ago because I wanted to see what it would do. It’s stayed between like $26.70 and $27.20 the whole time. I have it in DRIP, so it just repurchases monthly. I haven’t seen it do anything concerning yet, though, with that yield - it’s possible the bonds are risky.

mikehamm45

I’d turn on DRIP, contribute more periodically, even as low as 25$ per week, then I’d zoom out.

StandardAd239

Dude, I'm in index funds and my IRA holds leveraged index funds. I also DRIP dividends so I can retire early and let my capital appreciate. I'll do better than you over the long-term. I also have money in fixed income so as my other investments fall, I'm still getting some sort of return. But you do you.

west-coast-engineer

As someone with a lot of REITs I can tell you that you missed the boat. Late 2022 and early 2023 was the golden opportunity to load up. Especially commercial REITs. It was a golden opportunity because we didn't even get a recession. It was all due to the narrative that office workers would never come back, yet here we are and higher interest rates. Many of my REITs are up well over 100%. The yield on my principal is insane and for my tax-sheltered accounts, I let them DRIP which was just crazy compounding. If there is going to be a recession indeed, wait till it actually happens. The funny thing is rates will get lowered and REITs are bond proxies, so there is kind of a put there. So I doubt you'll see the kind of collapse of REITs that we go in 2022/23.

markgriz

As far as individual stocks, started buying T in 2011, primarily because of the great dividend. A few $100 here and there. Over time and with DRIP have 100+ shares, but even with the WBD spinoff, I'm still in the red. I'll continue to hold for the div. Best investment ever was AAPL, started accumulating that in 2016. Sitting on 160 shares with an average cost of about $50. Holding that forever.

ButlerWithaJumper

With a 50% drop: At the 10-year mark above, no. Your investment would be up 66% without DRIP gains At the 15-year mark (9/2009) you’d be up 296% At the 20-year mark (9/2005), you’d be up 254% (08 market crash caused this to have lower return than the 15-year). All without dividends reinvested.

Fusionism

What about if you DRIP, doesn't that outperform over longer timescales because of compounding?

Devincc

My investments yield 2% annually and DRIP. I’ll take that over liquidating assets, incurring a taxable event, and taking maybe 4% depending on the HYSA as most are around 3.7% now

RufusPDufus

If you’re asking for tax purposes, your brokerage will track the tax implications of your trades and send you forms in ~February. I’m pretty sure VOO has dividends, so if you DRIP, you’ll be purchasing more shares with each dividend payment. Each of those purchases will have a separate date (tax lot) for purposes of calculating long term or short term gains when you eventually sell. You’ll get a tax statement for your dividends along the way regardless if you DRIP or not. Note: You should still have a general idea what your cost basis was for your purchase so you can question it if your tax form looks off when you eventually do sell. I download transaction statements every year and keep them with my records in case I ever want to double check something. There isn’t anything wrong with having multiple brokerage accounts, but it can also complicate things for purposes of IRA contribution limits or wash sale rules. I suspect most people don’t open separate accounts for each ticker they trade.

the_old_coday182

DRIP