What is a DRIP Program?

December 4, 2020

What is a DRIP Program?

The Harvest Distribution Reinvestment Program (DRIP) allows unitholders to easily benefit from compounding their distributions. Under the plan, distributions are reinvested to buy additional units of the same ETF fund as set out in Harvest DRIP Plan, without incurring additional trading charges.

A DRIP is considered to be a practical way to grow your investments as distributions stay in the market (rather than taking the distributions out as cash) and you save on trading fees.

Investors may opt into the DRIP by contacting their brokerage firm.

 

Are Harvest ETF’s eligible for DRIP?

Canadian residents can participate in the Harvest DRIP plan in the following ETF’s:

Harvest Brand Leaders Plus Income ETF
Harvest Healthcare Leaders Income ETF
Harvest Tech Achievers Growth & Income ETF
Harvest  Energy Leaders Plus Income ETF
Harvest US Equity Plus Income ETF
Harvest Global REIT Leaders Income ETF

What is the tax treatment for DRIPs in Canada?

DRIPS reinvest distributions to purchase additional units. Because there is a cash dividend, although reinvested, it is considered as income and therefore taxable, unless held in a tax-sheltered investment account. Please consult your tax advisor for additional advice.

How are units bought or sold?

Units purchased or sold under the DRIP plan are purchased through the Toronto Stock Exchange (TSX) by the DRIP Plan Agent. The price of the units purchased or redeemed is based on the average price of all the units in respect to a given distribution payment date. The units will be allocated pro rata based on their respective entitlements to the distributions used to purchase units.


Read our blog post on Harvesting the Power of Reinvested Dividends

 

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Disclaimer

You will usually pay brokerage fees to your dealer if you purchase or sell units of the Fund(s) on the TSX. If the units are purchased or sold on the TSX, investors may pay more than the current net asset value when buying units of the Fund(s) and may receive less than the current net asset value when selling them. There are ongoing fees and expenses associated with owning units of an investment fund. Investment funds are not guaranteed, their values change frequently and past performance may not be repeated. An investment fund must prepare disclosure documents that contain key information about the fund. You can find more detailed information about the fund in these documents.

Certain statements in the Harvest Blog are forward looking Forward-looking statements (“FLS”) are statements that are predictive in nature, depend upon or refer to future events or conditions, or that include words such as “may,” “will,” “should,” “could,” “expect,” “anticipate,” “intend,” “plan,” “believe,” or  “estimate,” or other similar expressions. Statements that look forward in time or include anything other than historical information are subject to risks and uncertainties, and actual results, actions or events could differ materially from those set forth in the FLS.

FLS are not guarantees of future performance and are by their nature based on numerous assumptions, which include, amongst other things, that (i) the Fund can attract and maintain investors and have sufficient capital under management to effect their investment strategies, (ii) the investment strategies will produce the results intended by the portfolio managers, and (iii) the markets will react and perform in a manner consistent with the investment strategies. Although the FLS contained herein are based upon what the portfolio manager believe to be reasonable assumptions, the portfolio manager cannot assure that actual results will be consistent with these FLS.

Unless required by applicable law, Harvest Portfolios Group Inc. does not undertake, and specifically disclaim, any intention or obligation to update or revise any FLS, whether as a result of new information, future events or otherwise.

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