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If you felt burned by the stock market following the financial crash of 2008, you are not alone. The financial crash of 2008 left many wary of investing in the stock market and working with stockbrokers. In recent years, however, the investment landscape has undergone a transformation. Between the internet and numerous investment apps, it is possible to purchase stocks directly online without a broker. As a result, you have more flexibility in what you trade, when you trade and how much you pay in fees.
Whether you own stock or are looking to buy stock for the first time, it is worth considering whether buying stocks directly is right for you. Read on to learn more about your options for buying stocks without a broker.
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Best Ways to Buy Stocks Without a Broker
There are numerous options if you want to buy stocks without a broker. Companies offer stock-purchasing plans that vary depending on if you are an employee of the company.
If you are an employee, you can purchase company stock directly through a variety of options such as a direct purchase plan (DPP), a company stock purchase plan (SPP) or a company stock option purchase plan (SOPP). These plans typically allow employees to buy shares in a company without paying brokerage fees or requiring a brokerage account. Though the cost of investing is lower, most DPPs, SPPs and SOPPs include limits to both the amount of stock you can purchase as well as the amount deducted from your monthly paycheck. This can limit your potential returns.
If you are not an employee, you can buy stock from a company directly through either a Direct Stock Purchasing Program (DSPP) or a Dividend Reinvestment Plan (DRIP). By purchasing stock through a DSPP or DRIP, you can bypass brokers and brokerage fees to buy stock directly from your company of choice.
Best Ways to Buy Stocks From a Company Directly
The best ways to buy stock directly from a company are a DSPP and DRIP. Both options allow you to have more choice and control over what you invest, how much you invest and how long you invest.
1. Direct Stock Purchasing Program (DSPP)
A DSPP allows you to purchase stock from a company directly without having to pay commissions to a personal or online broker. Typically, the company you’re investing in will take a specified amount regularly from your checking or savings account. You can also make larger
one-time purchases instead of monthly amounts. If your company pays dividends, you also can reinvest your dividends back into the company by purchasing stock. DSPPs are an attractive, low-cost option to individuals who want to purchase stock from companies that they trust while retaining a high degree of self-directedness.
2. Dividend Reinvestment Plan (DRIP)
Companies distribute their profits to shareholders through dividends, or corporate payments, to encourage continued investment in their company. If you are a shareholder with a DRIP, you can continue purchasing company shares instead of receiving cash dividends. Since DRIPs don’t require a broker, you forgo broker fees and commissions, reducing the costs of investing.
If you have a DRIP, you purchase fractions of shares rather than whole shares. This means that the amount of a stock you purchase is smaller because you will be buying parts of shares instead of the whole amount. However, a DRIP is advantageous for individuals who wish to stay with a stock long-term and maximize compound returns.
Is it a Good Idea to Buy Stocks Without a Broker?
Online brokers can offer you many advantages that traditional brokers do not:
- Save you money and time with lower brokerage fees and real-time access
- Reduce the personal biases of brokers who promote standard investment packages
- Are convenient, allowing you to make trades from anywhere with internet access
- Provide analytical tools that can help you evaluate common stocks and preferred stocks to see which is a better fit for your investment goals
Investing with online brokers can have disadvantages:
- May be overwhelming for new investors with little to no market knowledge
- May be addictive, causing investors to spend too much too fast
- Allow you to make trades without considering how it affects your overall strategy
- Are dependent on computers and vulnerable to computer errors
If you decide to trade with an online broker, remember that you will have to put in the time to do research, develop a strategy and make adjustments along the way if you want to see a return on investments.
Best Commission Free Brokers to Buy Stock
Commission-free brokers are a great choice if you’re looking to capitalize on the flexibility and lower-costs of online brokers. Some of the best commission-free brokers are:
While many brokers are commission-free, it does not mean you won’t be paying fees to use their services. Brokers may charge other fees such as per-contract fees, account maintenance fees, account transfers and withdrawal fees among others. When researching a broker, make sure to take into account all fees associated with their services to see if they are a good fit for your needs.
If you’re ready to start dipping your toes back into stock market investing but want to retain your independence, you have some choices. You can invest in a stock or company directly through a variety of plans depending on whether you are an employee of a particular company. Alternatively, you can turn to the convenience and services offered by an online broker. Both options provide you with more flexibility and control over your trades and investments.
Best Stocks of the Day
Gainers
Symbol | Open | Close | Change | Change % | Volume |
---|---|---|---|---|---|
Buy LEJU Stock – Trade Now
LEJU
Leju Hldgs |
0.32 | 4.59 | 4.28 | 1352.94% | 1.47M |
Buy BEST Stock – Trade Now
BEST
BEST |
0.28 | 1.09 | 0.81 | 287.85% | 3.38M |
Buy BRW Stock – Trade Now
BRW
Saba Capital Income |
4.10 | 8.18 | 4.08 | 99.51% | 12.31K |
Buy GOVX Stock – Trade Now
GOVX
Geovax Labs |
0.73 | 1.35 | 0.61 | 84.01% | 31.82M |
Buy GLUr Stock – Trade Now
GLUr
The Gabelli Global Utility and Income Trust Rights (expiring June 23, 2022) Rights |
0.03 | 0.04 | 0.02 | 60.00% | 66.83K |
Buy SIGA Stock – Trade Now
SIGA
SIGA Technologies |
8.65 | 12.30 | 3.65 | 42.19% | 73.33M |
Buy NNVC Stock – Trade Now
NNVC
Nanoviricides |
1.85 | 2.59 | 0.74 | 39.99% | 1.23M |
Buy RDBX Stock – Trade Now
RDBX
Redbox Entertainment |
3.80 | 5.30 | 1.50 | 39.47% | 40.59M |
Buy IMMX Stock – Trade Now
IMMX
Immix Biopharma |
1.63 | 2.27 | 0.64 | 39.26% | 110.78M |
Buy TXMD Stock – Trade Now
TXMD
TherapeuticsMD |
2.27 | 3.10 | 0.83 | 36.56% | 21.90M |
Buy EBET Stock – Trade Now
EBET
EBET |
2.88 | 3.92 | 1.04 | 36.11% | 31.64K |
Buy TOMZ Stock – Trade Now
TOMZ
TOMI Environmental Solns |
0.73 | 0.95 | 0.22 | 30.30% | 1.60M |
Buy BODY Stock – Trade Now
BODY
Beachbody Co |
1.27 | 1.62 | 0.35 | 27.16% | 3.97M |
Buy ALLR Stock – Trade Now
ALLR
Allarity Therapeutics |
1.64 | 2.07 | 0.43 | 26.21% | 69.86K |
Buy PRTG Stock – Trade Now
PRTG
Portage Biotech |
6.62 | 8.21 | 1.59 | 23.94% | 55.33K |
Buy GET Stock – Trade Now
GET
Getnet Adquirencia |
1.47 | 1.79 | 0.32 | 21.76% | 1.55M |
Buy MDXH Stock – Trade Now
MDXH
MDxHealth |
7.60 | 9.23 | 1.63 | 21.42% | 2.82M |
Buy IBIO Stock – Trade Now
IBIO
iBio |
0.23 | 0.28 | 0.05 | 20.17% | 8.17M |
Buy AEMD Stock – Trade Now
AEMD
Aethlon Medical |
1.11 | 1.33 | 0.22 | 19.80% | 3.16M |
Buy NMTC Stock – Trade Now
NMTC
NeuroOne Medical Tech |
0.79 | 0.94 | 0.15 | 18.89% | 14.02K |
Losers
Symbol | Open | Close | Change | Change % | Volume |
---|---|---|---|---|---|
Buy RESI Stock – Trade Now
RESI
Front Yard Residential |
6003.61 | 12.32 | -5991.29 | -99.80% | 0.43K |
Buy XDNA Stock – Trade Now
XDNA
Strategic CRISPR & Gene Editing Technology ETF |
2801.99 | 9.56 | -2792.43 | -99.66% | 1.37K |
Buy ATHX Stock – Trade Now
ATHX
Athersys |
0.76 | 0.26 | -0.50 | -65.57% | 44.36M |
Buy EVFM Stock – Trade Now
EVFM
Evofem Biosciences |
1.10 | 0.40 | -0.70 | -63.30% | 20.70M |
Buy CELZ Stock – Trade Now
CELZ
Creative Medical Tech |
1.53 | 1.02 | -0.52 | -33.67% | 2.65M |
Buy VEDU Stock – Trade Now
VEDU
Visionary Education Tech |
3.05 | 2.15 | -0.90 | -29.51% | 2.97M |
Buy BGXX Stock – Trade Now
BGXX
Bright Green |
15.70 | 11.35 | -4.35 | -27.71% | 2.88M |
Buy MKD Stock – Trade Now
MKD
Molecular Data |
0.10 | 0.08 | -0.03 | -24.93% | 61.41M |
Buy TIGO Stock – Trade Now
TIGO
Millicom Intl Cellular |
22.20 | 17.08 | -5.12 | -23.05% | 40.01K |
Buy ROST Stock – Trade Now
ROST
Ross Stores |
92.70 | 71.94 | -20.77 | -22.41% | 33.67M |
Buy SJ Stock – Trade Now
SJ
Scienjoy Holding |
2.97 | 2.32 | -0.65 | -21.89% | 1.80M |
Buy NURO Stock – Trade Now
NURO
NeuroMetrix |
5.50 | 4.30 | -1.20 | -21.82% | 8.90M |
Buy ENDP Stock – Trade Now
ENDP
Endo International |
0.58 | 0.46 | -0.11 | -19.59% | 26.22M |
Buy BPTS Stock – Trade Now
BPTS
Biophytis |
1.44 | 1.16 | -0.28 | -19.45% | 3.71K |
Buy DPSI Stock – Trade Now
DPSI
DecisionPoint Sys |
6.98 | 5.67 | -1.31 | -18.72% | 46.65K |
Buy OBLG Stock – Trade Now
OBLG
Oblong |
0.36 | 0.29 | -0.07 | -18.29% | 29.13K |
Buy PTE Stock – Trade Now
PTE
PolarityTE |
2.86 | 2.37 | -0.49 | -17.13% | 26.05K |
Buy MGTA Stock – Trade Now
MGTA
Magenta Therapeutics |
1.46 | 1.22 | -0.25 | -16.79% | 46.00K |
Buy FRGE Stock – Trade Now
FRGE
Forge Global Holdings |
20.87 | 17.51 | -3.36 | -16.09% | 71.31K |
Buy FLGC Stock – Trade Now
FLGC
Flora Growth |
1.25 | 1.06 | -0.19 | -15.20% | 1.52M |
Frequently Asked Questions
How can novices buy stocks without a broker?
Some of the best ways are through DRIP and DSPP plans. You can purchase fractional shares and invest the dividends to increase your holdings in the company.
What is a simple way to quickly buy stocks?
You can use online brokers such as TD Ameritrade or E*TRADE.