Over the years, the no load stocks investing area has grown substantially. With the internet, gone are the days when the only person you could get advice from was your investment counselor. Just because you don’t want to pay any load fees, doesn’t make you cheap. If you are a smart and savvy investor, you are aware of the market and know what direction you are heading in. The arena of no load stocks is a bit more precarious than other no load venues and you had better know your stuff before jumping in.
No load means there are no front or back end fees associated with the investment. That doesn’t mean it is free. There are costs associated with no load stocks investing. They are usually annual fees divided up or explained by a variety of descriptions.
No load stocks differ from no load mutual funds in that there are different rules that you must abide by. Depending upon the stock you are selecting, there are minimum dollar investment requirements. The lower the stock is on the totem pole of returns, the lower the minimum. And, of course visa versa. There are a few out there that will offer a one-share purchase plan for those of us that are no rolling in the millions of dollars. Some investments can be made through an automatic deduction program. You must obligate a certain amount to be deducted over a required number of months.
The best bet is to sign up for a DRIP (Dividend Reinvestment Program). Not all investments offer DRIP, but it’s an excellent method to have your money reinvested. These usually do not have minimum requirements, which is the best route. They also usually don’t have any costs or fees associated with the reinvestment. This will allow your investment margins to show a better increase.
Know the rules, regulations and requirements of the company before you invest. While most might have similar guidelines, each company may have subtle or blatant differences that can make or break your investment.
If you don’t know the market, you are going to have to put in a lot of time not only in the examination process of no load stocks, but in the overall and longer term performance. The good news is that in selecting no load stocks, you are selecting the less risky of the choices over no load mutual funds. No load stocks are guaranteed. This is particularly important during times of duress in the market.
Watching the trends: In the first quarter of 2010, intense amounts of money have been directed towards no load mutual funds. The fear is that this is going to cause another bubble. You would think that people would have learned with the dot com and housing bubbles that there is a limit to the expansion. Eventually, it must burst. Keeping your eye on the trend of no load mutual funds investing could veer you towards the no load stock side. There is safety in stability and guarantees.
