Yes, it is. In 1935, a secretary at Abbott Laboratories purchased $180 worth of Abbott stock, and never sold them. 75 years later, those shares are worth $7 million.
http://bettertrading.blogspot.com/20...shares-of.html
While results like this aren't typical, investing $100 in a stock, and holding it for a long period of time can result in a significant gain. With most banks paying less than 1% interest on savings or checking accounts, investing your money makes even more sense.
There are some brokerage firms that only charge around $5 a trade. One I can think of is zecco.com. If you invest approximately $100 in a stock that offers a 5% dividend, using a brokerage firm that charges $5 per transaction, you'll get your purchase transaction fee back your first year, in dividends. If you hold onto this stock for 20 - 30 years, it could be worth a significant amount of money, in addition to the dividends you would have collected.
Another alternative is "Dividend Reinvestment Plans (DRPs)". These are plans where you can buy stock directly from a company without paying brokerage fees. In addition to this, the dividends are automatically reinvested in the company stock. Some companies require that you own at least one share of their stock before you can join their Dividend Reinvestment Plan. For this, you would need to buy a share from a broker, and the share would have to go under your name. This might cost a bit more than a regular transaction. If I remember correctly, it's about $15 - $20, but I don't know for sure. Once you purchase the stock in your name and enroll in the program, you can buy stock directly from the company without going through a brokerage firm. While this may cost you more initially, you will save money if you want to make future investments in this company stock. If you pay a $20 brokerage fee, so you can enroll in a DRP, and invest $80 now, six months from now if you want to invest another $100 in this same company, you can buy the stock without having to pay any brokerage fees. If you're planning to start investing with a small amount, and sporadically invest small amounts in the future, I think investing in a company with a Dividend Reinvestment Plan that offers a dividend of 4 - 5% or more is a good way to go.
Here's an article from Motley Fool on Dividend Reinvestment Plans:
http://www.fool.com/school/drips.htm




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