Overview

What is a DRiP?

What is a DDP?

How Do I get Started?

Where do I go? List of places to get started

What is the difference between a Direct Purchase Plan (DPP) and a Dividend Reinvestment Plan (DRIP)? Both are no-load stocks and in both cases the individual investor can buy stock directly from the company without going through a broker. However, to buy a DRIP, you need to already own stock to reinvest your dividend as more stock. With a DPP, you can be a first-time buyer. Of course most companies with a DPP also offer a DRIP. (Though there are some companies with a DRIP who do not yet have a DPP.) There are over 2,000 companies offering one type or another of direct purchase plan.

And what is this new type of financial industry which has sprung up, the "Folio Service"? Some folio services offer the opportunity to reinvest dividends even if a company does not directly offer a DRIP - and the folio service enables you to invest in a fraction of a stock, as does a DRIP.