A Dividend Reinvestment Plan (DRP) enables investors to select cash dividends or reinvest them into additional shares. Many ASX-listed companies incentivize participation with small discounts on current share prices. This initiative supports compounding returns and lowers transaction costs, appealing to long-term investors. Signing up for a DRP is simple, through a brokerage or directly with the company, allowing for full or partial reinvestment.
The Advantages of Dividend Reinvestment Plans for ASX Investors