3 Easy Ways to Invest in Stock Directly

by Nisha Sharma Research Analyst

Many beginner investors ask about ways to invest in stocks directly. Well, those investors who have been in the market for a long time know the answer to the question “how to invest in the stock market without opening a brokerage account?” Many expert investors know their way around investing directly in the stock market. It is not mandatory to work with some brokerage firm to invest in stocks or mutual

funds, or particularly equity funds.

However, direct investing has certain advantages and disadvantages which you gonna need to look out but before that, you need to know that how to invest without a broker. Only then you can make a decision about approaching this directly or not.

So, let’s find out, “what are the 3 easy ways to invest in the stock of a company directly?”

1. Direct Stock Purchase Plan (DSPP)

This is the easiest and simplest way for a person to buy stock directly from the company without any brokerage firm as a mediator. The direct stock purchase plans is a special type of program under which investors can buy stocks directly from the issuing company. However, the direct stock purchase plans have small transaction fees but very nominal in compared to the buying stocks through a broker.

2. Dividend Reinvestment Plans (DRIP)

DRIP is another simplest way for an investor to invest without any broker as a mediator. One who owns shares in a company with dividend reinvestment plans has the facility to participate in the DRIP. This scheme allows investors to take their dividends and plow them back to buy more shares in the company.

Also, there are often no fees associated with this plan. To understand it clearly, let’s assume an XYZ company pays a dividend of $1.00 per share on annual basis and its stock worth $50 per share. An investor owns 200 shares of that company under DRIP.

Instead of receiving a $200 check each year in dividends, the investor can easily buy 40 shares of stock. These shares are given directly from the company and no fees have been charged.

3. Employee Stock Purchase Plans (ESPP)

It is a good way for employees who work in publically listed companies, ESPPs provide a great chance for employees to buy stock of the company they employed in at a discounted price. In a way, those stocks can go directly into a retirement fund and money can be deducted from an employee’s salary.

Final Thoughts: -

In conclusion, we can say that “these days, it is not really a point to open a brokerage account especially when you have multiple ways to invest in the stock market”. Nevertheless, if you have any query or would like to add something up then don’t forget to mention in the comment section below.