How to buy stock directly from a company
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How to Buy Stocks Online Without a Broker – Direct Stock Purchase Plans
More than companies listed on major exchanges now offer small investors the option of buying stock directly from them. The types of companies you can buy stock directly from include big box stores, businesses in the restaurant industry and even some large manufacturers. DSPPs are a simple idea, really.
An investor opens an account with a company through a transfer agent and deposits funds in the account. Ownership of shares is then transferred to the investor. For many people, low minimum investments mean they can begin building a portfolio of high-quality stocks on a limited budget. Equally important, the transfer agent charges much less than a traditional broker. In some cases the company whose stock you are buying pays some or all of the fees so your money goes to purchase shares. Transactions cost a dollar or two as long as you use electronic funds transfer from a checking or savings account, plus cents per share.
However, there are some companies like Exxon Mobil who pay these charges for you. Companies offer added features to make their plans more attractive.
Some will keep your stock certificates in safekeeping and allow you to transfer ownership at no charge. In most plans you can chose to have part or all of your dividends reinvested at no charge. If you already have a particular company in mind as a possible investment, you can find out if they have a direct stock purchase plan by going to the company's Investor Relations website.
Check the listings of financial companies that specialize in DSPPs. The two largest are Computershare, Inc. Based in Atlanta, Georgia, William Adkins has been writing professionally since He writes about small business, finance and economics issues for publishers like Chron Small Business and Bizfluent.
Adkins holds master's degrees in history of business and labor and in sociology from Georgia State University. He became a member of the Society of Professional Journalists in Share It. TL;DR Too Long; Didn't Read The types of companies you can buy stock directly from include big box stores, businesses in the restaurant industry and even some large manufacturers.
About the Author.
To buy a stock, you'll want to evaluate the company as an investment, decide how You can buy stocks online, through a stockbroker or directly from certain. Buying stocks in individual companies is one of the most traditional ways to invest money in the stock market. There may be a few.
Achieving this is not easy, but you have to start somewhere. Investing in shares online is one of the best ways to reach this goal. And the good news is you that can do all of this completely online, from the comfort of your own home. In this article, we will explain jargon-free, in plain English, how to buy shares in a company.
With the ease of online investing, buying shares of a company has become a relatively simple way to build a nest egg or start a retirement fund. Investing in a company in your own country is typically fairly straightforward — you may even be able to buy your shares directly from the company and save yourself some money on broker fees and commissions.
More than companies listed on major exchanges now offer small investors the option of buying stock directly from them. The types of companies you can buy stock directly from include big box stores, businesses in the restaurant industry and even some large manufacturers. DSPPs are a simple idea, really.
Buying Stocks and Mutual Funds without a Broker
Company Filings More Search Options. Many companies allow you to buy or sell shares directly through a direct stock plan DSP. You can also have the cash dividends you receive from the company automatically reinvested into more shares through a dividend reinvestment plan DRIP. Direct Stock Plans — Some companies allow you to purchase or sell stock directly through them without your having to use or pay commissions to a broker. But you may have to pay a fee for using the plan's services. Some companies require that you already own stock in the company or are employed by the company before you may participate in their direct stock plans.
How Can I Purchase Stock Directly From a Company?
While many investors choose to buy and sell investments through a brokerage account , some investors may wonder how they can buy stocks without a broker. Direct investment plans offer the brokerage alternative that those investors are seeking. If your primary investing goal is to acquire a single company's stock as directly as possible, one of these plans can help you achieve that goal, but be aware of the drawbacks that come with avoiding brokerage services before you abandon them completely. Often, the easiest method of buying stocks without a broker is by participating in a company's direct stock plan DSP. These plans were originally conceived generations ago as a way for businesses to let smaller investors buy ownership directly from the company. Investors buy-in by transferring money from their checking or savings account. The company will establish minimum investment amounts, both for the initial purchase and for any subsequent purchases. The plan administrators batch the cash from those participating in the direct stock plan and use it to buy shares of the company at regular intervals and at the average market price. Companies may also offer a dividend reinvestment plan DRIP.
Can you be an online investor without a broker?
You can set up an account by depositing cash or stocks in a brokerage account. If you prefer buying and selling stocks online, you can use sites like E-Trade or Ameritrade.
How to buy shares online
Investing wth DSPPs is a low-cost way to invest directly with a publicly traded company. These plans are generally set up directly with the company or are administered through a third party transfer agent. Using a direct stock purchase plan has advantages over both traditional and online discount brokers. First, these plans avoid sometimes costly commissions and fees charged by brokerage firms. Another important benefit of using a DSPP is the passive investing opportunities that come with them. Investors can usually set up an automatic investment which transfers money from a bank account and purchases shares with the money. For as many reasons as there are to like direct stock purchase plans, there are some disadvantages investors should be aware of. T here are a number of different ways to invest in the stock market. Online discount brokers tend to be the most popular choice for buying and selling stock based on convenience and relatively low commissions and fees. Then there are traditional brokerage firms that may charge higher fees but offer more stock market advice.
Direct Stock Purchase Plans – Pros & Cons of Buying Stock Directly from the Company
There are a few circumstances in which a person can buy stock directly from a company. The following is meant to cover some of these instances, which include direct stock purchase plans , dividend reinvestment plans DRIPs , and employee stock purchase plans ESPPs. This is when a person buys stock directly from the issuing company. Several well-known companies will sell stock directly to individual investors. Most companies that offer this kind of purchase option don't charge investors a commission , and if they do, the commission or service charges is very low compared to buying stocks through a broker. If you're buying a very small number of shares and want to minimize your costs, a direct stock purchase is a great way to go. Investors who own shares in a company with a dividend reinvestment plan have the option of registering with the company and participating in the plan.
