This is prolly a simplistic question to those with acutal math ability, but for me it's confusing-- A friend of mine has owned CVX for years and was rationalizing to me that it's good when the stock declines, because when he reinvests the dividends, he'll be able to pick up more shares as the price goes lower. He claims reinvesting dividends into a declining stock will lead to exponential growth. In his words, the "dividends expound faster when the price is lower." Now, am I wrong to think that you will only experience exponential growth if CVX stays above the price you bought it at? Otherwise, if the stock declines, the only thing the dividends do is cushion your loss, i.e. no growth, let alone exponential growth.