Thread: DRIPs vs DPPs

Originally Posted by Skooby

Which is the better route to go?

Direct ReInvestment Plans or Direct Purchase Plans?

I'm not quite sure what you mean. Do you mean that you want to buy the stock directly from the company as advertised on TV? If so, the DRIP and DPP, are, I believe 2 different animals. The DRIP will just take the Divvies from the stock you purchase directly thru the company (DPP) and automatically reinvested them (DRIP) into future shares of stock instead of issuing you a divvy check.

If I'm mistaken, I'm sure someone will correct me. But that's my understanding on how the DPP's work.

CB

I was just trying to learn about them...I was way offbase with my question lol.

DRIPs can be with DPPs or through stock purchases through a broker, correct?

I guess my question should be...which is the better route to buy stocks...DPPs or through a discount broker?

Originally Posted by Skooby

I was just trying to learn about them...I was way offbase with my question lol.

DRIPs can be with DPPs or through stock purchases through a broker, correct?

I guess my question should be...which is the better route to buy stocks...DPPs or through a discount broker?

I use Sharebuilder, an on line broker. Others here us other ones. As far as the DPP's, I basically know how they work, but not what the logistics are. For example, with an on line broker, once you open an account, you can purchase pretty much what stock, etf or mutual fund that you want, although I don't belive sharebuilder gives you the option of mutual funds, but I'd had my fill of them and like the stock or ETF option better. With DPP's you may have to get an account opened for each separate stock that you want to purchase, though I've not gone the DPP route.

CB

Originally Posted by Skooby

Which is the better route to go?

Direct ReInvestment Plans or Direct Purchase Plans?

Skooby,

Below is link to an article that may help with your question.

http://seekingalpha.com/article/9842...downs-of-drips

CB