Reinvestment
Definition
What is Reinvestment?
Using distributions or proceeds to buy additional units instead of receiving cash.
Example in practice
How This Looks in Practice
A $12,000 distributionIncome or realised gains paid by a fund to its unitholders. is used to purchase more units, increasing the investorA person or organisation that commits capital with the expectation of a financial return.'s future participation in the fund.
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Related Terms
Lump-Sum Investment
A single, relatively large investment made at one time instead of through repeated contributions.
Investment MethodsDollar-Cost Averaging
Investing a fixed amount at regular intervals so the amount buys more units at lower prices and fewer at higher prices.
Investment MethodsSystematic Investment Plan
An arrangement for making scheduled recurring contributions into an investment fund.
Returns & PerformanceTotal Return
The complete investment result from price changes plus income, assuming distributions are included.