Finance : DRIP Calculator
Dividend reinvestment plans (DRIPs) allow an individual shareholder to reinvest dividends in company shares. For example, if a company stock trades for $20 and has a dividend of $1, the yearly one dollar can be used to buy 0.05 shares. The next year, the shareholder will have 1.05 shares and receive $1.05 in dividends and that many shares will be bought. DRIPs usually allow fractional share ownership and purchases. The DRIP calculator will use the initial share price, shares owned, yearly dividend, and years owned to calculate the yearly income and total shares purchased.
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