Lessons: Chapter 16 - Buying Stocks Directly from Companies


Important Links

You can get information about direct investing from the following site(s):

DirectInvesting

 

 


Assignments

16.1: Which one of the following is the reason why companies allow investors to buy stocks directly from them:

  1. They see direct purchase as a way to encourage consumer loyalty

  2. They see direct purchase as a way to do market research

16.2: True or False. You can participate in a company's Dividend Reinvestment Plan or DRIP only if you already own at least one share of the company's stock.

16.3: True or False. You can participate in a company's direct investment plan only if you already have at least one share of the company's stock.

16.4  The term street name relates to which of the following:

  1. The name of the brokerage firm that buys stocks for you

  2. The headquarter address of the company whose stock you intend to buy

16.5: Which one of the items below is not an advantage of investing in Dividend Reinvestment Plans and direct investment plans

  1. Both plans allow optional small cash investments to buy fractions of a share

  2. Both charge very little transaction fees

  3. Both allow you to reinvest dividends

  4. Both require that the stock you buy is in the "street name"

16.6: Use the following instructions to find the details of the DRIP and direct investment plans associated with Nike.  

  1. Visit the site, DirectInvesting.com

  2. In the "Find Drip" box, type in NKE

  3. The page you land on will show you the DRIP and direct investing plans associated with Nike

 

> Answers to Chapter 16 Assignments