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Do All Companies with DRIPs Necessarily Have DSPs?

Q. Do all companies with Dividend Reinvestment Plans necessarily have Direct Stock Plans?

A. No. A "Direct Stock Plan" (sometimes known as a "no-load stock") allows investors to purchase initial shares of stock directly from the company. Afterwards, the investor purchases additional shares from the company and/or have dividends reinvested into the purchase of additional shares (as in a typical "Dividend Reinvestment Plan."

Some companies that don't pay dividends do offer Direct Stock Plans as a way to encourage individuals to purchase their stock.

While there are thousands of companies with DRIPs, only a few hundred offer Direct Stock Plans. More are converting to DSPs, however. Here is a list of Direct Stock Plans currently available to individuals.