If your stocks have a profit of $1,000 in a day, can you reinvest the profit back into the stock? If so, how do you do it?
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Our response:
If you are referring to a $1,000 increase in the value of your stocks, the answer is, in short, no. That profit is not realized until you sell the stock, meaning you cannot reinvest it. Learn more about how stocks work.
However, if you are referring to a distribution, like a dividend, you can arrange to have dividends reinvested through a dividend reinvestment plan (DRIP). A DRIP is the automatic reinvestment of shareholder dividends in more shares of the company’s stock.
Speak to a financial advisor to learn more about dividend reinvestment plans.