Ask Doug

Can I Start Trading Online Without a Lot of Money?

Q. I'm looking to get started investing online, but I don't have the initial minimum investment of $1,000 to take advantage of the low commisions of a company such as E*Trade. Where can I go?

A. You can get started investing in stocks through Dividend Reinvestment Plans (DRIPs). Over 800 companies have DRIPs, whereby all dividends are reinvested for you in additional shares of stock automatically by the company itself. You still need to buy that first share, but there are services to help you do that:

First Share is a program where members sell each other the initial shares needed to get started in a DRIP and First Share takes a small fee for setting it up.

Also, several hundred companies now have plans whereby you can buy the first share of stock directly from the company. Check out No-Load Stocks for more information.