The discount drip price is 39.6844.
Drippers who pay real close to the discount price, please name your broker and when the drip shares post to your account.
Drippers who pay MORE than 40.00 for your drip shares, please name your broker, state the price you paid (to 4 decimal places) and the date the drip shares posted to your account.
Let's name the brokers who are screwing their clients.
TD gave me the correct price shares posted shortly after pay date (like within a day or 2) I did not read @ the 5% discount for 5+ distributions / careless, but this is one of the best deals out there for drip. Most of the funds I have are closed end and are at a discount so not worth it and I usually like to trade in even blocks, think I am going to be keeping this for at least a year til it becomes fairly valued or longer.
Many do not participate because it must be done by hand for every client and that costs money. There are some hundreds of discount drippers, but most are very small companies. There is also the issue that the broker needs to go through the transfer agent as DAR stated. The transfer agent does not issue them the same day. Sometimes a day or two. Some brokers are crediting immediately to your account using company numbers or their own calculation and the broker waits for the transfer agent to issue the shares in a block.
dar200...I hold ETP in my E-Trade account and I'm signed up for the DRIP program. I see my distribution booked on 11/14/12 and that they reinvested @ $42.8304 (which was about the high of the day on Wed 14th).
Question: How does Schwab & Ameritrade reinvest distributions at a "Discounted" DRIP price?
Is it possible that all DRIP participants automatically reinvest at a discounted rate, but E-Trade keeps the discount?
Read the specifics of the discount drip program on the ETP website. Then you have first hand facts to present to ET. ETP hires a drip administrator. Anybody who wants discount drip has to sign up with the administrator. This includes brokers for street name units (like mine at Ameritrade and Fidelity and yours at ET).
The drip administrator knows on the ex-dividend date how many drip DOLLARS are to be reinvested.
On the evening before the pay date the drip administrator calculates the price per unit, just like I did.
The drip administrator then divides total dollars to be dripped by the discount price to calculate total drip units needed and notifies ETP. ETP issues new units to the drip administrator who, in turn, distributes them to shareholders including brokers who in turn allocate total broker shares to the customers who elected discount drip. The unit transfers are all done electronically. ETP keeps the drip cash.
In your typical drip thru a broker, the broker knows how many drip dollars are to be reinvested on the ex date and the broker buys as many shares as those dollars will buy in the open market. No new shares (units) are created or issued by the company. Fidelity buys drip shares three business days before the pay date so those trades settle on the pay date. Ameritrade buys in the open market the first business day after the pay date (thereby "stealing" (my opinion word) 4 to 6 days worth of interest on the dividend cash. It appears Etrade buys on the pay date.
I don't know why Etrade does not register with the drip administrator for the discount in newly issued units. I don't know if or how they profit by screwing their client. Why don't you ask them?
I can answer for TD. They figure out the drip price on their own and IF - note the IF - you have an account of sufficient size AND you have requested to sign up for "Specials" on DRIPs they simply credit your account and get the discounted shares in a day or two from the transfer agent.
Do not know what E-Trades policies are. There are three possibilities. In neither cases are they "screwing you". #1 - They may now participate in DRIPs and simply buy in the open market - usually at the opening price on the day following payment. #2 - They participate in DRIPs but only handle "Specials" on request. #3 - They do not deal with "Specials". If either #2 or #3 are correct you have two choices - move your account or forget it. E-Trade cannot legally keep a DRIP discount.
Anybody have a drip post yet? If yes, please report to this thread.
If I remember correctly, last Q Ameritrade posted discount drip shares about 1:00pm the day after the pay date. Not so this Q as of just before this post.