Can I Invest in Share Market without Broker?

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Can I Invest in Share Market without Broker?

Can I Invest in Share Market without Broker? ( The Beginner’s Guide ):

Yes, you are reading the right topic correctly.

You can invest in the Share Market without a broker also.

And how you can do that we will explain you by this article on “Can I Invest in Share Market without Broker?”

Mostly, you had purchases the shares through the brokers, right?

And what if you get to know that you can also invest or purchase in the stocks with the involvement of the broker.

Yes, my friend you can invest in the share market without any broker and also you can save some cost like brokerage charges.

Another option of investing in the stock market with any broker is through the Direct Stock Purchase Plan (DSPP).

If you have small amount for the investment and you don’t want it to get wiped out by the brokerage charges, then you can consider this option for investing in the share market without broker.

DSPP’s are allowed by the company to directly purchase the shares from the company with the help of the transfer agent.

They are also recognized as the no-loads stocks.

What is Direct Stock Purchase Plan (DSPP)?

Direct Stock Purchase Plan (DSPP) is unlike the common, they are the plans that are set-up for investing directly in the company with the help of third party transfer agents that are appointed by the company itself.

This options are largely held with the large and well-established companies where the issuer of the stock can agree for automatically money withdrawals from checking the savings account for purchasing of more stocks.

The third party transfer agent is representative of the company.

They can be any bank, a trust-worthy company or any of the organization.

Some of the companies choose themselves as the transfer agent but mostly they use a third party agent.

Despite, DSPP’s option is a good investment type for the beginner in the investing or trading world but with that you should also aware of the advantages and disadvantages of this option for investing in the share market without any broker.

Let’s talk about the advantages of the DSPP.

Advantages of DSPP

  • Direct Stock Purchase Plan helps in saving the heavy brokerage fees and the commissions for purchasing the stocks from the stock brokers.
  • This can also consider as good for the passive investment opportunity that is within the hand of the investors as they can also set up an automatic investment plan that can withdrawal the money from the savings account in order to purchase the stocks.

This was about the advantages of the Direct Stock Purchase Plan.

Now, move forward to its disadvantages.

Disadvantages of DSPP

  • At the start for opting this option, you need to pay the initial set up fee that most companies charge from the investors to open an account. The cost is low but still most of the investors prefers to buy the shares from the brokers.
  • Another disadvantage of the DSPP is the automatic investment fees as this charges varies from companies to companies.
  • This option of buying the stocks from without broker is unsuitable for the short-term traders. So, this type of traders stick to the low-cost discount brokers.
  • DSPP also have another problem is that it have lack of diversification as the investors need to look after more options on other sectors also rather in the same specific company.
  • In DSPP, there is multiple of the accounts associated for purchasing the shares and investors prefers only one account and therefore they choose the brokers and stick to their demat account.

These were all the disadvantage of the Direct Stock Purchase Plan.

Before making any investment decision for this you need to look after both the pros and cons of the Direct Stock Purchase Plan.


Through our article on “Can I Invest in Share Market without Broker?” and this explains about the second option about purchasing the shares from the share market without involvement of the broker is through the DSPP method. DSPP is Direct Stock Purchase Plan and we had explained about the definition, its advantages and disadvantages. You need to get the complete knowledge about this method with making any decision on investment in the share market.

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