I’m proud to say I was the guy who left the comment about questioning DRIP in Jimmy’s “my personal investment portfolio” video. Makes me happy to know my idea may help the long term return of a man whose ideas will probably help the long term return of me :)

I just wish DRIP plans had more flexibility, some brokers just reinvest into the same stocks, they should ask you specifically what you want to reinvest into like M1 Finance does since It's far more goal oriented.

Thanks Jimmy! I recently un-DRIPped all of my positions after watching this. It does make a lot more sense to just reinvest the cash into whatever equities I WANT to reinvest them into rather than possibly losing out on more opportunity by DRIPping back into a position that I might not be so excited about.

Great video! I think one simple way of thinking for those people interested in a dividend reinvestment strategy is: when you are beginning your portfolio and the dividends you receive are small, a DRIP is a great idea, because buying fees are very relevant relative to your reinvestment power. But, as your portfolio grows, and with it the dividends received, you gain buying power. At that point, having the choice of when and which stock to buy is a much more powerful option (not to mention that fees become less relevant now). So, a DRIP does not make much sense anymore.

I've been building a dividend portfolio in my Roth for the last 6 years. I'm hoping to live off of them in my retirement. I usually buy the aristocrats / kings so that I get a raise every year. It's like having a golden goose laying golden eggs.

Been subscribed for quite awhile along with other investment channels, but have only 2 now. I sold out 100% last Feb and got back in heavily in Q2 with dividend Kings/Aristocrats and ETFs, I have learned sooo much thanks to your vids! I joined today to help preserve what I have for the future. THANKS AGAIN Jimmy!

My dividends are just deposited in my brokerage account on my phone, and I just reinvest it into stocks at the moment I find good value

I'm not reinvesting my dividends automatically but I always check for investment alternatives and use the cash from dividends together with a fraction of income/savings while growing my portfolio and diversify more throughout other countries. Thanks for the video and DRIP is a GOOD PLAN but saving the cash for new opportunities to investments is better whenever you can!

Thank you for this video. I opted out of reinvesting the dividends in my brokerage account two days ago thinking the way you are. It’s good to know my thought is validated .👍🏻

All my dividends from stocks go into 2 etf’s- s&p and dax. Both etfs up 15% and 13%

Great topic! I would like the same analysis with O. Your argument to not DRIP is really market timing. I have repeatedly heard that DCA outperforms market timing. I have really gone back and forth with this issue and part of it boils down to passive vs active investing and how many different stocks one has to keep track of.

Hi Jimmy, Thank you for sharing your knowledge with us! Could you please make a video explaining why is dividend investing/reinvesting better than shorting cash covered puts/calls and reinvesting the premium? (assuming consistent average profit) Apart from making it a more difficult and sophisticated strategy for obvious reasons, It is something that Buffet also used. Based on your earlier video that explains that the dividend is actually subtracted from the stock price, It does not make sense to me as an optimal strategy. It seems like 1 planned day, 100% success shorting, on autopilot to me, BUT while owning the stock. Thank you in advance for reading my comment. Keep up the high-quality videos and educative videos.

I like to personally allocate my dividends to undervalued stocks or stocks that might pop

i think one of the flaws with dividend videos nowadays is that they only take into account their past buys. i would find more value in videos that talk about making a full dividend portfolio today starting from scratch. good luck if you do that, its a lot harder now when you get 2% yield on "great companies"

I understand the ease of set-and-forget with DRIPs but I just manually reinvest my dividends into stocks that are not over-valued or have not cut dividends :)

Great video as always Jimmy, thank you. You have to move to Canada and open a TFSA and/or RRSP account, you’ll see your tax problem gets alleviated real quick. 🤣 Another option would be keeping the DRIP and periodically sell shares of that DRIP in an amount equal to the dividend earned. This way you would not have money sitting around.

For me still the best KZfaq channel without question! 👍

I have a question about the stock market that I don't know how to google. Currently, stock markets are opened from monday to friday between 9h30 to 16h. I reckon that is a byproduct of the era when people met in person. Why not have markets opened only one day a week for low liquidity stocks? What would be the disadvantages of a market that only accepted orders in advance and executed these orders once a week. Orders would be sent in the form of a function, q(p), where q is the quantity you are ready to buy/sell at p price. The market would find the price at which the largest amount of stocks could be traded (where there is the same number of buyers and sellers at a given price). Wouldn't this increase liquidity, reduce volatility and prevent daytraders from existing on that market? Wouldn't this render the milisecond advantages large companies have on the stock market useless? Are these good things? Or are we losing something else that I am not thing about?

Best teacher!!!!!!

That makes perfect sense! I always wanted to have DRIP, but I guess it might not be so bad that I can't have one currently. Thanks for putting in the effort and passing on your knowledge! 🤗

I don't think my brokers have DRIP, but I just reinvest all my dividends anyway. Long T!

I also have INTC at $46.12 and I thought about to reinvest the dividend but I did not want to buy in at the current prices to increase my average cost. Thanks Jimmy

You make fantastic videos. Keep up the good work!!

This is great, I was just watching a video by FastGraphs on this very same topic. Jimmy, I like your style better. Fastgraphs does have amazing information though. it's not one channel or the other, I'll take it from all sources so I can learn. What I'm doing is using my M1 Finance account where I have retirement accounts (protected from taxes during dividend pay outs) get all the dividends back in the same account, switch off auto investment, and I choose out of the stocks (that I already own) which are 'value buys' and then I buy those every month or so. Each month is usually a different stock. Thank you Jimmy for your excellent series of videos.. I'm trying to learn as best that I can from you.

When I held TSM for 5 years I reinvested. At this price point - it is a tough one. Turned 10k into 110k+ but yeah when things are overextended I sold and took my profits. Kept the initial investment in to just ride. Picked up some DIS and LMT. But I am bearish for 2021 overall. Second half of 2021 is spooky A F. I am a buyer then - till then no thanks.

It’s good when you don’t have any strong connection in which to place pooled dividends. Passive Investing generally outperforms though so it’s powerful.

Does the same notion of not investing in the same stock via DRIP because the stock might be overvalued, apply to REIT investments aka Real Estate Investment Trusts?

totally agree to reinvest dividend on other stocks that is undervalued at the time and this is a kind of rebalancing…

not reinvesting dividends gives you an opportunity to rebalance without selling or coming up with outside cash.

Hey Jimmy, where can I acess the Analyst estimates for the free Cash Flows that you are using in your Stock valuation Videos?

I don't like DRIPs, I prefer to get the cash and decide for myself if, when and what to purchase. Committing to the same stock is just one possibility which isn't necessarily the best one with every dividend receipt.

Good morning Jimmy and to you guys reading this, ive seen a lot of your videos Jimmy and i really like your content, these kind of knowledge isnt always for free to us and we have to appreciate that, tho im a stock holder for about 4 months now in an Oil and Gas company Enterprise Product Partners (EPD), do you guys think, or you Jimmy think, these type of companies are a good pick for a long term DIVIDEND REINVESTING PLAN (DRIP). I think EPD is trading in an undervalued price now maybe this is an opportunity.

Hi Jimmy, thanks for the video! Could you do a video of an actual example of analysing a business? Starting from scanning through a list of businesses to analysing a potentially good pick?

Under 60 seconds and I’m 7th. You have some dedicated fans!

If you let your DRIP percolate for 30 years, how would you calculate the basis for capital gains tax when you finally sell? If the number of purchased shares and share price differ every quarter (for 120 quarters) you would have an accounting nightmare.

I cant deny, Jim killed it with DIS and INTC . Im somewhat jealous yes

Also a resource to check out, drip calculators online to approximate future returns.

Two points in favor of DRIP : - it is a kind of DCA - I think you get a discount when you use DRIP

If disney and intel stocks aren't a buy at the current level, should they be sold? If they aren't undervalued in your eyes, shouldn't you just sell them and buy another stock that is undervalued? Why didn't you sell some or all of intel or disney to pill on lockheed martin? Is there some sort of investor inertia going on or what?

Where does a company get new shares each month for my reinvestment? Does it print shares? Like Federal reserve prints dollars? If a company creates every month or every quarter new shares for reinvestment, the value of each share becomes smaller

Hello there

Lucky you in US. In Europe, at least in Italy, fractional shares do not exist

If the company you’re drippin changes for the worse and dumps in price as well as dividends you’ve just wasted 10 years of your life. Also dripping increases the share of the stock in your portfolio. So keep that in mind.

With brokerages allowing fractional buying of shares I use my dividend from one company to buy a value stock that has an Ex-Dividend date locking in soon so my compounding happens even faster.

Thank you for your work Jimmy, ove your channel! What is your take on chinese stocks, there might be some undervalued options in china right now...?

What a fantastic video. Thank you Jimmy!

DRiP is really the only way to compound returns, which is at least 50% of the point of dividend growth investing.

There's been a lot of changes in how we're able to invest in the last few years, and I don't think that DRIP programs comport well with the current situation. I'm an old guy. When I was younger, brokerage fees were crippling, and DRIP made a ton of sense. These days, there are no commissions for most accounts, or at worst maybe a few bucks or so if you buy a foreign security. You can literally buy one share at a time, with no penalty, which is something I do on almost a daily basis. In light of this, it doesn't make sense to necessarily commit the dividend of a stock to buying that very same stock. I have a pool of dividends that I receive, staggered so that pretty much every month I've got something coming in. I commit those dividends to buying stocks that are highest on my priority acquisition list. A large percentage of those dividends do go back into my core list of dividend stocks, of course, because it's dividends that I'm after, but it's important to maintain the flexibility to position your resources to your greatest advantage. DRIP is obsolete. With 0 commission brokers out there, we can reinvest our dividends on our own.

im not a expert at the whole stocks thing but i would manual buy when the stocks falls to keep your average down so when later on in the future you will sell it for money you will get more than what you would of by buying close to the market price every month giving you no capital gain back when you bought it 10 years ago just what im seeing in the future and use that money put on another stock when its cheap to get the dividends you was gonna get from the 1st stock and still mantaining the captial gain Now am i right or am i right

Jimmy : researches show that almost no active fund can beat the index in the long run. If this is true , even value investing and stock picking won’t work . What do you think ? Should we just go for a well diversified portfolio instead of trying to find value stocks ?

Here's the issue I have with your argument on why you stopped using DRIP. If Disney and Intel are too expensive for you to buy using your dividends, doesn't that also mean they're too expensive for you not to sell? The opportunity cost of your shares is equal to their current price. By choosing to hold Disney today when it could be sold for $190/share, that is equivalent to buying the shares today at $190/share. I don't think it's logical to say that a price is too high to not buy more of, but not too high to continue holding, since holding is the same as giving up the amount of money you could make selling them. To be consistent, you should sell your Disney and Intel shares today, and then give yourself a bigger cash balance to spend on the next undervalued company you come across.

Great vid. Very informative

what a perfect way to start my morning ;)

New to your channel! Watched and liked and subscribed!

Okay, two caveats - AT&T is very unusual in paying such a high dividend. I get that this makes the compounding effect more exiting, but it's not typical, and I feel like people might assume that it is. I have this same beef with Dave Ramsey's FPU, by the way. They're still talking about getting a 12% return on your savings. Also, almost every stock in exisitence is up a crazy amount from last year at this time, because that was the huge pandemic crash. I bought in a year ago and am seeing huge returns, but I really can't see that continuing. So I really don't think "one year ago to now" is a fair comparison for looking to the future. I appreciate the discussion about the idea of re-investing dividends; it's a question I've been asking myself lately. I think your examples were a bit misleading, but the overall discussion was good.

Should you pay a capital gain tax or any other taxes on dividends before reinvesment (DRIP)?

What do you think about At&t at its current price?

I have about 5% of my portfolio in uranium stock any advice on any other stock that I can grow my $300k capital to a million dollars?

What’s your take on RKT? Love your videos. Keep it up!

Thank you.

Interesting thoughts. I like the idea a lot in theory, but I don’t know how practical it is for me right now. If I had a huge portfolio where I get hundreds or thousands of dollars in dividends each month, this could be a good strategy. But if I’m earning only $60 or so a month from dividends, I’m not sure how practical this is. Also, why not take this strategy further? If you don’t like the idea of investing more money at a certain price point, why don’t you sell what you currently own (assuming you’ve held for at least a year to get a more favorable tax rate) since it’s not at a good price anymore?

Great video mate

Auto-dripping is not for me. So I manually reinvest my dividends and buy more shares of companies I already own but appear at a good value.

Hey Jimmy, Chemed would be an interesting stock to analyze. It's the nation's largest hospice company, has nearly no debt, and is under the radar.

Thank for doing it.. Btw, can you make a video for best REIT so i can do reit and drip

Great video!

Nice video 😊

Jimmy wants Jimmy to make a video on Groupon!

My Dividend list is Intel, IBM, Phizer, IRM, APPLE, Verizon, Walmart, PG, S&P500 High Dividend ETF

Dividend withholding taxes eats up those dividends with drip. Buying stocks without dividends or companies that buy back stocks are better for investors overall.

HPE - solid growth ahead and dividend play...

Used my dividends to buy some more lockheed stock when it fell

Jimmy: Hi, I’m Jimmy. Me: clicks on the thumbs up button

👍

I love Nautica polos too. Is that a "white guy thing" like Crocs? I hope not. It's a great clothing company (not sponsored lol).

WooHoo Jimmy boy!

Cash is Trash but Cashflow is King!

DRIP investment plans are good for those investors who don't care about market timing or short term over valuation in DGI names they own and want to keep buying partial shares as currency for future income. I personally don't DRIP, but reinvest those dividends in undervalued to fairly valued names, so that the income growth can have a great enough chance of compounding at even greater rates than when DRIP is used..

Is like money having babies. 🤑🤑🤑

Keep up the great work Jimmy!

Are you still actively investing in Disney and Intel?

Great video, really inspiring!! Dividend paying stock is something that I've just begun to invest in. Thanks to Mary Margaret Cartier I'am 33 and I'am pretty annoyed with myself that it's something that I haven't done along time ago. Seeing the returns

Just an fyi for those who have it. ATT is about to go ex dividend.

Really good video

Hey boss, you investing in ARKX? They got that LMT drip

Unfortunately most of these actions are very US focused. In Germany, there is no DRIP and I have to pay taxes all the time when dividends are distributed. No ROTH or similar. I can just do my own reinvestment or throw money to one of the many stupid Riester or Rürupp retirement funds without having any control on the investment because the companies do that. So I stick with investing into stocks on my own, being very disciplined and at one point in my 40s, I will FIRE ... even if every structure and organisation around me does not support me in the effort. But, I am confident.

DRIP is the same as share buybacks. Only makes sense when the stock is undervalued or fairy valued.

I don’t necessarily reinvest in the company that paid me

I'm in everything about the drip 🥶🥶

Hu good morning

DRIP is the best!

Always... Keep the Dividends in, until you actually retire...

Jimmy's down!!!......on Disney right now 😂

Thanks for great info. However it is very tiring listening to you because you tend to pause mid sentence.

DRIPs are for lazy people. Just keep an eye on your account at least 3 times a year and use the dividends for other better options.

Boy spam has really become a Problem in the Comment section of this Video

Reinvestment plan is pointless3. I rather manage my account myself