A little back ground on what is stock and how do you purchase it. Stock is a share of the company you want to purchase stock in. On a small scale, let's say there is a small company that wants to raise money to grow. The company issues stock to raise the money it needs. So if the company needs 100,000 (one hundred thousand dollars), it issues shares for example totaling that amount. Each share of stock can be priced at $100.00 a share. Which will total 1000 shares. Or the company could price it at $50.00 a share. This is done following a set of rules and regulations set by the SEC (security and exchange commission). If a company is a close corporation privately held with thirty or less members, the company may set the price without filing with the SEC.

A company that is going to sell stock to the public will be required to file papers with the SEC and get a ruling before the company can issue stock on the open stock exchange.These rules are to protect the public from shady dealings of lessons learned from the past.

Now to purchase your first share of stock. Depending on the one stock out of thousands traded everyday, this would tell you what market your stock is traded on and can be brought. There are a lot of books about the markets so I won't bore you with that. Let's get to the main point. How to buy shares.

Here are three ways to purchase shares on the stock exchange.

1. Stock Broker - a stock broker is a person that is licensed to purchase and sell shares of stock on the market exchanges.

If you are confident that you can reseach a stock and understand how the market works, you can use a discount broker who will just buy what you tell him to.

Now on the other hand if you aren't confident about the workings of the markets, you can use a full service broker who will do all the reseach and purchase and sell your stock for you.

2. Internet Broker Firms - offer full service and discount broker services. E-Trade, Scott Trade

3. Stock Purchase Direct from companies. Example: Some companies are a part of a program call the dividend reinvestment program.

The DRP works like this: You purchase a number of shares in a company, some company only require you to purchase one share, lets say $25.00. Then when ;the company pay dividends on the share of stock it is reinvested in the stock. So if the dividend total $4.00 which is $1.00 quarterly. The stock will be worth $29.00 at years end. This can be more or less depending on market conditions.

To sum it all up, you can purchase a share of stock from any stock brokage firm in person or on the internet. And remeber you can also purchase direct from the company if they offer DRP.