I (we) own these in our Roth IRAs held at Fidelity and learned something interesting about them.
Five of my dividends from 6/30 were still showing “pending reinvestment” in my Fidelity account, so I “chatted them up” to find out what was going on.
Seems these 5 are part of a DTC Discount Plan. I learned something new!
The DTC Discount Plan allows reinvestment at a potential discount price between 0-5%.
Although the DTC Discount Plan offers the benefit of a discount, please note the following:
-DTC guidelines state that discounted reinvestment prices can take on average up to 15 business days to post. You will still receive the reinvestment, but it may not be posted to your account immediately.
-The issuer determines the DTC discount price. Fidelity cannot provide any reinvestment information until the reinvestment appears in the account.
-The eligibility of a security may change after you enroll in dividend reinvestment.
-If a position is sold while waiting for the DTC dividend reinvestment, Fidelity credits the account with cash, not stock.
DTC = Depository Trust Company.
Only PHT has yet to be ‘worked’. FFC, FLC, PFD, & PFO have been reinvested at a very nice discount!
My history now shows an inflated amount for the dividends received, and a discounted price for reinvestment based on closing price for the payable date. So, it looks like a double discount!
I have asked Fidelity about this, and I’m awaiting their reply…
FFC was ‘worked’ on 7/7, FLC, PFD, & PFO were ‘worked’ on 7/8.
FFC showed “pending reinvestment” of a $7.62 dividend, but now shows .037 shares from a dividend of $8.02 reinvested @ $20.58
FLC showed “pending reinvestment” of a $7.75 dividend, but now shows .0372 shares from a dividend of $8.16 reinvested @ $20.81
PFD showed “pending reinvestment” of a $7.11 dividend, but now shows .479 shares from a dividend of $7.48 reinvested @ $14.86
PFO showed “pending reinvestment” of a $7.30 dividend, but now shows .615 shares from a dividend of $7.69 reinvested @ $11.88
PHT still shows “DIV OF $15.39 PENDING REINVESTMENT as of 06/30/2016 PIONEER HIGH INCOME TR (PHT) (Cash)”
PHT showed “pending reinvestment” of a $15.39 dividend, but now shows 1.562 shares from a dividend of $15.39 reinvested @ $9.85
I also heard from someone on StockTwits that DNP is another in this category, although I do not own that one.
Color me confused, but happy.