DRIPs -- Dividend reinvestment plans Message Board

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Non-Tech : DRIPs -- Dividend reinvestment plans

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To: Jacob S. Rosenberg who wrote (5)	10/31/1996 9:25:00 AM
From: Michael W. Brom	of 263

Jacob: Nice to see a fellow mathematician in here. I have not been following the threads too much. This thread has been here for a while, but I didn't find it until I ran a search for DRIPs. I can agree with you on most of your points, but the main purpose of DRIPs is to allow small investors to be directly involved in stocks. The initial investments are usually smaller amounts and subsequent investements are also usually smaller. As for mutual funds providing diversification "free of charge", that is not true. EVERY mutual fund charges a minimum of fund expenses, and maybe 12b-1 fees as well as various types of loads. Part of the excitement of investing in DRIPs is that the individual investor is in charger of his/her investments. There's no middle man. Not that all individual investors make better investment decisions than money managers, but being a mathematician, you, of all people, can appreciate the power of compounding. Expenses hurt investments in the same manner reinvested dividends help investments. Your thoughts? Michael W. Brom

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