Direct stock-purchase programs

Direct stock-purchase programs

Investors purchase securities directly from the issuer.

Direct Stock-Purchase Program

A plan in which a publicly-traded company allows an investor to buy stock directly from the company rather than through a broker-dealer. Some companies offer direct stock purchase plans to raise financing at less expense to the investor (mainly through not charging commissions or fees). Some advisers recommend that first-time investors use direct stock purchase plans because of the reduced cost. It should not be confused with an employee stock option plan because direct stock purchase plans are open to anyone.
References in periodicals archive ?
These direct stock-purchase programs are enhanced versions of dividend reinvestment plans or DRIPs.
Free list of companies offering direct stock-purchase programs are offered by The DRIP Investor (1-800-711-7969) and from the web site http://www.