I am dismayed that Vanguard, which markets itself as cost conscious, buys reinvestment shares at the open regardless of the price premium, instead of doing so later in the day, say at noon, I just called them, vanguard shares for div were purchased at 61.87. The day's range so far is 61.96 to 61.06. I would be grateful if holders at other brokerage houses let me know what price they were reinvested at. This happens consistently that the prices are all purchased at the open and near or at the days high.
I think you're splitting hairs; sometimes you'll get a "good" div reinvestment price and sometimes you won't. It averages out.
FYI I reinvest my divs via Fidelity. Fido buys shares three days before the div is paid whereas I believe P & G's drip buys on the payment date.
I know I give up control as to price, but i expect Vanguard to be more price conscious than they are: so far it has not evened out,prices are consistently at or near the high for the day and usually higher than the prior day close + div. it defies common sense to pay more than 52.5 cents above the close of the prior day for a 52.5 cent div, in vanguards case they buy at the open without regard to price.... in this case close was 61.14, div reinvest was 61.87 on a day high of 61.96 and for the vast majority of the day it traded at about 61.40.
Thanks all, I know I've been thinking about this, and will track my other divs in Sept. Close was 61.14 day before, buy at close, sell at open for 61.87, a small gain but if it happens consistently it may add up to an opportunity every quarter. I posted a comment on the vanguard facebook fan page asking why "costs matter" on the mutual fund side but not on the div reinvestment side and the response: block me from the fan page. Really?
"buys reinvestment shares at the open regardless of the price premium"
I'm really surprised to hear this, even more surprised they would admit it publically. I guess it has the benefit of tranparency - you can confirm what the price should be. May not be market moving info but certainly interesting information. Wonder how many shares an organization VanGaurd's size buys that day?