Re: DRIPs

From: Derrick Cole <dccole@mindspring.com>
Subject: Re: DRIPs
Date: Fri, 04 Sep 1998 15:19:06 -0400

Next Article (by Author): Re: DRIPs Douglas Gerlach
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No disagreement here, but keep reading: I was using DRIPs initially so that
virtually all monies went towards acquiring stock (thus indeed taking
advantage of "no commissions").  Now that I've "crested the wave", I'm able to
contribute "several hundred dollars" and the commission indeed be negligible
(compared to the amount of the contribution on a good day, < 1%).

I guess it's a trade-off of style and need: if you want liquidity and control
at some percentage of cost, go with a broker.  If you care about neither
liquidity nor control and want to minimize/remove cost, go with a DRIP.

My opinion,
Derrick

Douglas Gerlach wrote:

> If you do this, you lose the ability to invest with no commissions. The
> opportunity to invest in shares of stock with *no* commission is the real
> advantage of DRIPs -- not the reinvestment of dividends. Even at $12 or $7
> commissions per trade, you have to invest several hundred dollars before
> the commissions become small enough to have only a minimal impact on your
> portfolio. Fees and commissions have a direct impact on your investment
> returns.




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