Buying Stocks Without A Broker
Q: Anyone have any recommendations for buying stocks direct from companies who offer them? If so, who? What are the pros and cons?
A: 1. Lots of paperwork, but not a big deal if you're organized or you use a financial software program like Quicken to track your finances. 2. You can't choose the price at which you buy/sell, or even the date in most cases, since most DRIPs invest on predetermined dates (usually once per month, although some will do once per week, others only once per quarter). If the stock is volatile, like some technology stocks that go up/down by $5 in a week, you may want to resort to a discount broker for large purchases rather than rely on the plan. But if you're investing small amounts, you'll save more by not paying the commission than by capturing the lower stock price. I've been investing in mutual funds for a number of years and my sorch of information for the past 6 years is FUNDS ON-LINE. FOL identifires the right funds at the right time. Model portfolios help you in your decision making. My gain this year is 39% and my average annual gain for the past 6 years in more tht 22%. Take a look a the home page for FOL. http://www.well.com/user/mutual/ Most companies will pay the nominal comissions for you and will send you a 1099 form, so that you'll pay tax on that comisiion (about 5c a share). In some cases they will charge you a nominal comission. Expect, however to be hit with the broker's comissions when selling your shares. The NAIC ph number is (810)583-6242. The membership is $39/year and there is a one-time set up fee of $7 per company. Another option is a First Share company. They will try to find somebody to sell you one share of a company with DRIP. There is also a membership fee and - I believe - a finder's fee that you pay.