How to Buy Caterpillar Direct Stock
Caterpillar is one of the world's largest manufacturers of construction, agricultural and mining equipment. The company was formed in 1925 from the merger of C. L. Best Tractors and Holt Manufacturing, both pioneers in tractors and related machinery. Based in Peoria, Ill., Caterpillar is traded on the NYSE (stock symbol CAT). The company also offers a direct stock purchase plan through its transfer agent BNY Mellon, so you can buy Caterpillar stock directly and avoid broker's commissions.
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Instructions
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Obtain and read Caterpillar's DSPP prospectus before you enroll. The prospectus presents complete details of the plan, including all fees, terms and conditions. You can request a copy of the prospectus and enrollment form by mail by calling (866) 353-7849 (for TTY 1-800-231-5469). However, you can view the prospectus and a plan summary on the BNY Mellon direct stock purchase plan website (link below). When the page comes up, click on InvestorDirect Search, enter "Caterpillar" and follow the prompts. You can choose to view the Caterpillar plan materials (prospectus) or plan summary.
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Decide how much you want to invest. You can start with as little as $250 by check or electronic debiting. However, this requirement is waived if you set up monthly automatic debits. You can enroll by mail or use the enrollment wizard to sign up online (on the same webpage described in Step 1).
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Enroll by filling out the enrollment and authorization forms. You will need to provide your personal information, including your Social Security number and bank account information. For electronic funds transfers, you must complete an authorization form. There is a one-time $15 setup fee. Once you complete the online form or drop a paper form in the mail, you're on your way to becoming a Caterpillar shareholder.
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Make additional investments with deposits of as little as $25 (there is a monthly maximum of $10,000). When you buy Caterpillar stock directly, there is a $1-per-purchase fee ($2.50 for paper checks) plus 3 cents per share (as of 2009).
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Tips & Warnings
The transaction fees for the sale of Caterpillar shares are higher (this is standard practice with DSPP accounts). The sale fee is $15, plus 12 cents per share (2009 rate).
