A Dividend Reinvestment Plan (DRP) lets you receive additional shares or units instead of some or all of a cash dividend or distribution.
How Does Dividend Reinvestment Work?
When you participate in a DRP, the company or fund uses your eligible payment to allocate more shares or units. The allocation depends on the reinvestment price and the plan’s rules, including how it handles amounts that cannot buy a whole share.
For example, if AUD $100 is available to reinvest at AUD $25 per share, you receive four additional shares. Use your statement for the actual allocation.
The additional shares become part of your holding and may increase the number of shares eligible for later dividends.
What Does Navexa Do?
Navexa records your reinvested income and the corresponding Dividend Reinvestment trade so your holding reflects the additional shares or units.
Turning on DRP in Navexa does not enrol you in a plan or buy shares for you. Arrange participation through the company’s share registry or your broker, then make your Navexa records match what happened.
If you start or stop participating, update Navexa separately. A change at your broker or registry does not automatically change your Navexa holding setting.
How Can I Track Reinvestments?
Navexa offers two ways to record reinvestments:
Automatic DRP: Navexa calculates reinvestments for eligible unconfirmed payments using the holding’s selected calculation method, where automatic DRP is available.
Individual reinvestments: enter the actual allocation for a particular payment using your statement.
If you are setting up a holding or your participation has changed, start with How to Set Up Dividend Reinvestment in Navexa. It explains which approach suits your history and what to check before turning on automatic DRP.
Remember, this is general information, not personal financial advice.