Corporate Actions

Dividend Reinvestment Plan

Definition

What is Dividend Reinvestment Plan?

A programme that automatically uses cash dividends to purchase additional shares or units.

Example in practice

A ₦5,000 dividend buys more shares instead of being paid into the investor's bank account.

Keep learning

An offer allowing existing shareholders to buy additional shares, usually in proportion to their holdings.

An issue of additional shares to existing shareholders without a cash payment.

An increase in the number of shares accompanied by a proportional reduction in price per share, leaving total value initially unchanged.

A vote cast by another person or electronically on behalf of a shareholder.

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