See, my friend is what some might call a capitalist tool. He works quite a bit, primarily at minimum wage jobs, and then spends the majority of the money he makes on various things including video games and such. So…, for his birthday me and a few friends want to give him some stock. Preferably from a company that’ll give him some dividends. Oh yeah, we also want to spend around $80.
So the questions are:
What is a steady stock that will give dividends?
Where do I go if I want to buy stock and get a stock certificate or whatever?
Is there anything special we’ll have to do to order shares of that stock in his name?
Also, what do people think about this idea? Maybe I should be putting this in IMHO…
This is OK for GQ. You have to go to a stock broker. If you have a bank account at a larger bank, they probably have a brokerage service. You may have to open an account to do this. You can tell them how you want the stock registered and tell them you want the certificate instead of letting it be held in street name. Then you can present the actual stock certificate to your friend.
IIRC Microsoft has started to pay dividends. For 80 you could buy three shares at today's price. The first dividend paid last March was .08 per share
GM pays about $.40 per quarter per share. They are trading at about $50 a share.
So your friend ain’t going to get rich on $80 worth of stock. Usually when you buy stocks for income from dividends you are sinking thousands–tens of thousands–HUNDREDS of thousands into it.
Oh, yeah, Arturius has a point. Even with a discount brokerage you’re probably going to pay a $35 commission on the trade. They have minimums. Stocks are most commonly traded in blocks of 100 shares.
Well, the idea was not for him to get rich off of it, but just as kind of a fun gift. Although is the brokerage fee really that much? I remember hearing it depends on who you work with. Well, I guess I’ll look into it then.
One option would be Sharebuilder.com, they specialize in allowing very small accounts. I believe the commission is $4 and there is no minimum account balance. Through them I believe you would be out of luck on the actual share certificate. They only buy shares at set intervals, they keep costs low by bundling many investors orders together.
If you still want to go through with it a good choice would be Altria (formerly known as Phillip Morris). Those smokes bring in plenty of cash flow and they pay a healthy dividend.
