What happened to the DRIPs?

Posted by David Dusseault on December 02, 2010 (08:20AM)

Tolga,

I sent you a PM on Thanksgiving as well to offer a solution to you regarding dividends. Can you check that out and reply to me via PM?

DRIP for fractionals will return once we move to the new Penson systems, as I mention above we don't know the date for that yet.

We have our tech team looking at your statement issue. They are looking at your account as if they were logged in as you, with a mac, and they are not able to duplicate the problem. I suggest you work directly with Peter Laptewicz on this issue. His email is plaptewicz@tradeking.com and he is already aware of your issue.

Thanks,
Dave

Posted by cmont on December 03, 2010 (02:11AM)

I am also unhappy with the loss of DRIPs for fractional shares.  I moved all my dividend stocks from Scottrade to my TK account because Scottrade does not offer DRIP.
I also appreciate the difficulties in moving a system as large as TKs from one clearing house to another.  I doubt that my 2 accounts are large enough to receive much advantage from the switch but I am willing to wait a while before I consider moving my account to another broker since I've never had a complaint with TK in the years I have used them.  I have always gotten courteous and knowledgeable  people when I needed customer service; my trade executions have also been fast and accurate.  I may be too inexperienced to notice if they were not though. 

 It may be that my age gives me a little more patience, but I do know that a threat to move my account won't help.  I just hope TK gets the problem solved quickly and we get our DRIPs back soon.

Posted by mitsurugi on December 03, 2010 (01:04PM)

I've never posted on the TradeKing forums but have been with the company for some time. I came over to this forum after talking with a live rep about the DRIP change to see if any others have also expressed distaste for the new clearing firm regarding DRIPs.
I realize that there are already many complaints in this thread about the new rules, but I wanted to post anyhow. I moved to TradeKing from Zecco. Zecco was also with Penson and I couldn't stand them. With the ever-changing rules and repeated tax correction forms I decided to switch to TK, partially because they didn't use Penson. One year I received three versions of tax return forms, each with new corrections that were not on the last one. Zecco also quickly became a bait-and-switch by offering free trades and then soon revoking them. I can't help but wonder if the same thing is happening with TK. 

Although I don't have numbers, I suspect that a large number of TK's customers are smaller investors with less than, say $10,000 in their account. DRIPs are vital for small investors because they allow them to build up their accounts without being charged transaction fees. I rarely have a dividend that allows me to buy whole shares, and thus the new rules completely negate the benefits that the DRIPs offered in the first place. I have to believe that many others are having this same problem.

I like TK for a lot of reasons. Their customer service has always been top notch, their prices are low, and the interface is easy to work with. Unfortunately, this is a deal-breaker. I echo the sentiment of others in this thread who wonder what, if any, advantages could have possibly come from the Penson transfer. Since I cannot see any benefits to me, the customer, I can only guess that the benefits is being less expensive for TK. Fair enough, but it is disappointing to see this happen. I did not sign up for these new rules, and I do not wish to be bound by them. 

Time to start shopping for a new broker again, I suppose. It's been a good run TK. Best of luck in your future endeavors.


Posted by hybrid on December 10, 2010 (09:53PM)

I'm very unhappy with this change too. Fractional dividend reinvestment was a good reason to go with Tradeking.I have not really looked at the competition lately because I was happy with Tradeking. I hear they are offering free ETF trades at a bunch of places. Maybe it is time to switch.

Posted by Preb2k4 on December 13, 2010 (02:11PM)

mitsurugi, i completely agree with everything that you said.  I have expressed my displeasure regarding the loss of fractional DRIP in several threads, so I will not rehash it again.  Because of everything else I do like at TradeKing, I have decided to give TradeKing some time to get this worked out. 

I agree that a lot of the smaller investors use TradeKing, because of the lower commissions.  If you are trading massive volume, the extra $5 probably wouldn't matter.  The smaller investors are exactly who this new policy harms.  Hopefully TK can get this worked out within the next year, because that is about how long my patience for this will last.
Img_4028_thumb Brokerage Account

Posted by 47 on December 13, 2010 (10:37PM)

I'm thrilled to hear that fractional dividends will be making their return at some point in the coming year, and I look forward to the day when I can return my accounts to TK.  Despite having moved on because of the dividend issue, I commend the customer service and general treatment I received during my time here.  Cheers

Posted by BenL on December 30, 2010 (11:19AM)

I recently switched to TK myself and thus far have been satisfied with everything.  It was this forum topic alone that secured my decision to switch to TK.  I wasn't happy with the elimination of the partial share DRIP plans but due to the fact they plan on reinstating them and until they do they will reinvest whole shares with cash holdings and waive the commission fee I was content.  However, first dividend was received and when I called to have the commission fee waived or reimbursed they told me they were no longer doing this.  This is extremely disappointing as I would have never came over, this affects my long term goals and investing strategies far too much. 

Has this reimbursement or waiving stopped?  Will TK actually get partials back this year?  Not one of my dividend stocks produces enough per dividend to purchase a whole share!

Posted by TK Frisbee Guy on December 30, 2010 (02:54PM)

BenL and All,


Thank you, as always, for the feedback, which we do use in making decisions on how best to enhance our site. BenL, I was sorry to hear about the confusion when you called up, and I see we are reaching out to you to get this corrected.

To clarify our offer:

At this time, if you are enrolled in our DRIP program, fractional shares are not able to be purchased. If you receive an eligible dividend that was not reinvested because the amount was for less than the cost of a single share, we will credit your account for a future free $4.95 stock trade. This will enable you to reinvest the dividend proceeds.

To take advantage of this offer: Once you have received an eligible dividend paid to your account, please contact us by phone (877-495-5464) or through LiveChat to request a free trade per this DRIP offer. We will then code a free stock trade to the account, and on your next trade, you will see the Activity book normally, then overnight, subtract out $4.95 in commission costs. 


Wishing you all a happy and prosperous 2011,

Best regards,

Rocco Sabino
TradeKing Customer Support

Posted by Golf is Neat on December 31, 2010 (05:12PM)

Will my dividends be given to me in cash?

Posted by keithl on January 02, 2011 (08:26PM)

Is there any ETA on fractional DRIP? Also on MLP and REITs I see that even full shares on many MLPs, ETFs and REITs are not covered at all full or partial. Any plan to cover them for DRIP?

Posted by TK Frisbee Guy on January 03, 2011 (03:30PM)

Golf is Neat,


That's correct, dividends pay out by default as Cash. Also, if you have an account encoded for DRIP, and receive a dividend which is for less than the amount of a single share, that would also pay in cash, which is where our offer above would come in handy.


keithl,


We do not have a schedule confirmed from our clearing firm on when we would be able to offer fractional reinvestment again in the future, however, the above offer will be valid until fractional reinvestment is again available. We do not currently have any plans in place to re-offer DRIP for MLPs or REITs or other securities, which generate a K1 form. ETFs should currently be available for reinvestment, and would be eligible for our offer above for a free future trade if you choose to reinvest a dividend from an ETF that was for less than the cost of a single share.



Best regards,

Rocco Sabino
TradeKing Customer Support


Posted by smitty on February 15, 2011 (12:37AM)


Any word on when the drip plan wll be back?

Posted by TK Frisbee Guy on February 15, 2011 (10:44AM)

smitty,


Unfortunately, we're still not able to confirm an ETA or schedule. The Clearing Firm is exploring this, and is confident that they will be able to accommodate it in the future, but have not yet laid out a time-frame for us.


Best regards,


Rocco Sabino
TradeKing Customer Support

Posted by Preb2k4 on March 30, 2011 (02:22PM)


Thanks for keeping us updated.  Hopefully you can get an ETA soon.

Posted by BenL on May 23, 2011 (01:48PM)


I just want to keep this issue alive.... 
Any status updates on the Partial DRIP?  This is something very important to me and if its not something that is going to happen I will unfortunately move my money.  That is the only thing lacking and just happens to be huge to me.  I have tried to manage with the trade credits towards making shares whole, but it becomes a hassle with my schedule and not seeing it as something I would sustain.

I do send out props to TK and everything else they offer, excellent staff and site.

Thanks,

Ben

Posted by MTValue on May 24, 2011 (02:23AM)

This issue definitely needs to be kept alive. People missing the fractional shares DRIP need to keep on this, because if we allow this issue to die it probably will not return. The fractional shares DRIP was my favorite thing about tradeking and I really hope it will be returned soon. I liked it here at TK and don't want to have to go elsewhere.

Please bring the fractional share repurchases back.


Posted by king123 on May 27, 2011 (11:52AM)

I am still waiting also, to open accts for my two kids, but not without drips.If not here by end of year i am going somwhere else where they have Drip.GOOD LUCK.

Posted by king123 on May 31, 2011 (12:18PM)

They love to avoid this topic, don't they.Hello anyone there TRADEKING!

Posted by TK Frisbee Guy on May 31, 2011 (01:04PM)

MTValue and king123,


Feedback at TradeKing does not fall on deaf ears, and I can speak confidently to fractional DRIP as an example of exactly this. We weigh client feedback heavily in determining how best to invest in and improve our site, to the end goal of being the best brokerage firm on the planet. For fractional reinvestment, the information from this forum is still currently correct, and I'm glad to expand a bit further on the topic.

Our current clearing firm has not traditionally offered this service, instead as you know, limiting their free reinvestment program to whole shares only. When we converted, and heard our clients' strong desire to see this feature re-introduced with our new clearing partner, we had Penson begin the process to explore how they could accommodate the service. To this point, they've determined how it will be done, and have given us their initial estimation for arrival within Q4-2011.

Essentially, this change is going to require a complete overhaul to certain systems the clearing firm uses in holding and maintaining accounts. They need to coordinate this between all brokerages that they clear for, and in as smooth and seamless a process as possible. Fractional reinvestment is in the works to be offered again in the coming months, and this forum will certainly remain out there for all, clients and public alike, to see.

Please also note from this thread that TradeKing has offered to absorb the commission costs for the reinvestment of eligible dividends which were too small to purchase an additional share, allowing for free reinvestment should a client wish to add funds to the dividend amount to buy more shares. This offer will remain in effect until our DRIP program once again support fractional shares.

At this time, if you are enrolled in our DRIP program, fractional shares are not able to be purchased. If you receive an eligible dividend that was not reinvested because the amount was for less than the cost of a single share, we will credit your account for a future free $4.95 stock trade. This will enable you to reinvest the dividend proceeds.

To take advantage of this offer: Once you have received an eligible dividend paid to your account, please contact us by phone (877-495-5464) or through LiveChat to request a free trade per this DRIP offer. We will then code a free stock trade to the account, and on your next trade, you will see the Activity book normally, then overnight, subtract out $4.95 in commission costs.

Of course, as any more information or update becomes available, we'll certainly keep everyone in the loop.


Best regards,

Rocco Sabino
TradeKing Customer Support

Posted by king123 on May 31, 2011 (03:12PM)


TY for update.
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