What is a DRP?
The share market is full of jargon which may not be familiar to the new investor. A term which is used frequently is DRP. This acronym means “Dividend Reinvestment Plan”. In this article we discuss the reasons why investors may want to take it up, and the potential downsides. Definition of dividend reinvestment plan Companies can pay their dividends to entitled stock holders through stock as opposed to cash. Some companies may offer DRP shares at a discount to market …