Refresh April 01, 2025 11:37 PM ET
Refresh April 01, 2025 11:37 PM ET
Learn About Dividend Reinvestment Programs (DRIPs)
A Dividend Reinvestment Program (DRIP) is a convenient way to help your investments grow through systematic purchases. A DRIP lets you take the money you receive when a company pays a dividend and immediately purchase additional shares of that company's stock without having to place an order, pay a commission, or purchase a round number of shares.
How do I access information about DRIP activity in my account
Any shares or partial shares you're entitled to as part of a DRIP will be placed in your account on the day the dividend is payable.
The dividend and share purchase activity will appear on your statement for the time period in which the transaction took place. You can also see share totals (including fractional shares) displayed on the Positions screen, as well as on your statement.
To find the recent dividend history for a company:
DRIP eligibility requirements
Unfortunately, not all securities are eligible for dividend reinvestment and therefore may not appear on the tab displaying securities that may be enrolled in a DRIP.
For a security to be eligible for a DRIP, it must meet the following criteria:
DRIP Enrollment and Withdrawals are normally processed within two business days. Submissions after business hours or on the weekend or holiday will be processed at the beginning of the next business day.
The following security types can be enrolled on the DRIP page:
Although open-end mutual funds are not eligible for DRIPs, distributions may be elected in cash or reinvestment into the mutual fund. Customers must elect their preference for cash or reinvestment of distributions upon initial purchase of the open-end mutual fund. Customers may change their initial election by calling our customer service team at 800-387-2331.
How are DRIP shares purchased?
When a stock you own and have enrolled in a DRIP pays a dividend, those funds are automatically invested in additional shares of that company's stock, instead of being deposited into your account as cash. The shares are purchased in one of two ways.
First, shares may be obtained through the Depository Trust Company's (DTC) DRIP. In this case, DTC and the issuer determine which securities can participate in the DTC DRIP. DTC allocates reinvestment shares to Morgan Stanley upon receipt from the issuer and, in most cases, the allocation of shares can take multiple business days. Only certain eligible DTC program securities participate in the reinvestment program. For securities participating in the DTC program, the cash dividend will be credited to your account on the same day the reinvestment shares are allocated.
Second, for securities that are not handled through the company-sponsored discount program via the DTC DRIP, those securities are purchased on a best-efforts basis. In those cases, Morgan Stanley will credit your account the number of who and, if applicable, partial shares equal to the amount of your funds to be reinvested in a particular security divided by the purchase price per share.
E*TRADE reserves the right to withdraw a security from a Dividend Reinvestment Program at any time. In such case, the dividend will be deposited into your account as cash.
Because the amount of your dividend may not be enough to buy an even number of shares, you'll receive "fractional shares." For example, if you had 100 shares of stock XYZ—trading at $30 with a dividend of $0.13 per share—you'd receive a total of $13, which would translate into an additional 0.433 shares of XYZ stock (13 divided by 30).
To learn more about fractional shares, please review the Fractional Shares article available here.
Enroll in a DRIP
You may enroll any security that is eligible for DRIP by navigating to the Dividend Reinvestment tab for your account and clicking on the check box next to the security and clicking submit.
You may also click on the account level toggle at the top of the page to enroll any securities added to your account (not already in your portfolio) in the future automatically in DRIP. Purchasing additional shares of a security already owned in your portfolio will follow the existing DRIP enrollment or withdrawal status.
Cancel participation in a DRIP
To cancel participation in a DRIP, uncheck the check box next to the security and click submit.
How do I access information about DRIP activity in my account
Any shares or partial shares you're entitled to as part of a DRIP will be placed in your account on the day the dividend is payable.
The dividend and share purchase activity will appear on your statement for the time period in which the transaction took place. You can also see share totals (including fractional shares) displayed on the Positions screen, as well as on your statement.
To find the recent dividend history for a company:
- Enter a ticker symbol into the search bar and select the desired symbol.
- From the Snapshot page, choose the Charts page.
- Click Company Events on the left navigation, and then click the Dividends check box.
DRIP eligibility requirements
Unfortunately, not all securities are eligible for dividend reinvestment and therefore may not appear on the tab displaying securities that may be enrolled in a DRIP.
For a security to be eligible for a DRIP, it must meet the following criteria:
- The security must be held in your E*TRADE from Morgan Stanley account.
- The value of the security must be $5 or more.
- The security must be currently paying a dividend.
DRIP Enrollment and Withdrawals are normally processed within two business days. Submissions after business hours or on the weekend or holiday will be processed at the beginning of the next business day.
The following security types can be enrolled on the DRIP page:
- Equities
- ADR
- ORDs
- ETFs
- Closed-end Mutual Funds
Although open-end mutual funds are not eligible for DRIPs, distributions may be elected in cash or reinvestment into the mutual fund. Customers must elect their preference for cash or reinvestment of distributions upon initial purchase of the open-end mutual fund. Customers may change their initial election by calling our customer service team at 800-387-2331.
How are DRIP shares purchased?
When a stock you own and have enrolled in a DRIP pays a dividend, those funds are automatically invested in additional shares of that company's stock, instead of being deposited into your account as cash. The shares are purchased in one of two ways.
First, shares may be obtained through the Depository Trust Company's (DTC) DRIP. In this case, DTC and the issuer determine which securities can participate in the DTC DRIP. DTC allocates reinvestment shares to Morgan Stanley upon receipt from the issuer and, in most cases, the allocation of shares can take multiple business days. Only certain eligible DTC program securities participate in the reinvestment program. For securities participating in the DTC program, the cash dividend will be credited to your account on the same day the reinvestment shares are allocated.
Second, for securities that are not handled through the company-sponsored discount program via the DTC DRIP, those securities are purchased on a best-efforts basis. In those cases, Morgan Stanley will credit your account the number of who and, if applicable, partial shares equal to the amount of your funds to be reinvested in a particular security divided by the purchase price per share.
E*TRADE reserves the right to withdraw a security from a Dividend Reinvestment Program at any time. In such case, the dividend will be deposited into your account as cash.
Because the amount of your dividend may not be enough to buy an even number of shares, you'll receive "fractional shares." For example, if you had 100 shares of stock XYZ—trading at $30 with a dividend of $0.13 per share—you'd receive a total of $13, which would translate into an additional 0.433 shares of XYZ stock (13 divided by 30).
To learn more about fractional shares, please review the Fractional Shares article available here.
Enroll in a DRIP
You may enroll any security that is eligible for DRIP by navigating to the Dividend Reinvestment tab for your account and clicking on the check box next to the security and clicking submit.
You may also click on the account level toggle at the top of the page to enroll any securities added to your account (not already in your portfolio) in the future automatically in DRIP. Purchasing additional shares of a security already owned in your portfolio will follow the existing DRIP enrollment or withdrawal status.
Cancel participation in a DRIP
To cancel participation in a DRIP, uncheck the check box next to the security and click submit.