For nearly 25 years, direct stock purchase plans (DSPPs) have been available as a way for investors to buy a company stock directly without the assistance of a broker.
Self-directed investors make very loyal shareowners and often contribute positively to proxy voting results.
“A typical investor who uses a broker holds stock for an average of less than one year and they’re buying a specific number of shares,” said Jim Volpe, Vice President, Product Management Investment Plans, EQ. “Those who buy through a DSPP are interested in long-term wealth and growth over time, holding shares for eight to 12 years.”
“Self-directed investors make very loyal shareowners and often contribute positively to proxy voting results,” said Volpe.
Many companies don’t think they can increase their shareowner base in a cost-effective manner while effectively growing equity.
The InvestDIRECT plan fees are fully paid by the participants. The company saves the cost of quarterly mailings and will only pay for the year end account statements. Shareowners can enroll for as little as $250, benefiting from 24/7 online availability to access their account, statements and tax forms.
Shares can be purchased weekly on the open market using dollar-cost averaging and dividends are fully reinvested, eliminating the possibility of lost checks and continuing to grow the shareowner’s investment over time.
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