For donations Click Here

Automatic dividend reinvestment that may occur on Yom Tov


We own stocks and mutual fund shares that automatically reinvest dividends. Sometimes the purchase date or the settlement date (when the shares actually change ownership, generally 2 days after the purchase date) is on Yom Tov. Is this a problem; should we cancel the automatic reinvestment if there is a possibility that shares will be purchased or settled on Yom Tov? And if so, If a particular account does not give the option to forgo reinvestment must we sell the funds before Yom Tov to avoid this?
Also, does it make a difference if we do not know in advance which day the transaction will occur?


It is permitted because it is automatic and you didn’t instruct the company to specifically make the transaction on Yom Tov. Also you are not really making a kinyan on the stocks, rather it is being placed into your account. This is even if you happen to know that the transaction will take place on this day.

Leave a comment

Your email address will not be published. Required fields are marked *