Accumulation Plan
A commonly used investment strategy where an investor attempts to increase the value of his or her portfolio by adding more shares of currently held equities. By buying more shares of a mutual fund or stock over time investors can achieve greater returns than simply holding on to an original position.
More often an accumulation plan is part of a mutual fund and is referred to, “building your nest egg.” Most funds have automatic investment plans that will automatically buy investors more shares each month with the money contributed through a retirement fund such as a 401-k.
Some accumulation plans can consist of investments over a ten, twenty, or even thirty year period.
Related Terms
- 401(k) plan
- 12B-1 Plan
- DRIP-Dividend Reinvestment Plan
- Employee Stock Ownership Plan – ESOP
- A Terms
- Accumulation/Distribution
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