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Reinvestment

18 February, 2008 (22:50) | Definitions | By: Pinyo

Reinvestment is the process of using dividends, interest, or distribution earned in an investment (e.g., stock, mutual fund, ETF, etc.) to purchase additional shares, instead of receiving payments in cash.

This is a great way to increase your position in an investment without adding new money, or incurring trading expenses (since most financial institutions offer free and automatic reinvestment option).

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