Ask Doug

Can I Invest Online -- Without a Broker?

Q. Can a person invest directly via the Internet and skip the brokers -- and their fees? How and where is this done?

A. Whenever you buy a stock, you're not buying it from that company, you're buying it from another investor who is selling it. As such, brokers are an inevitable fact of life. Brokers match buyers and sellers, and that's the service for which they charge a fee or commission. So, online or not, you generally can't skip the brokers.

There is, however, a way for you to invest without a broker in several hundred companies who are set up to sell investors an initial share or number of shares so that these investors can then enroll in the company's Dividend Reinvestment Plan (or DRIP). These are known as direct stock plans (DSPs) or "no-load" stocks, and you can find complete information on the web by pointing your browser to our Complete Guide to DRIP Investing. There can be fees or commissions involved with these plans, so investigate before you invest.