New Gift Card Allows You To Buy Company Stock
PHILADELPHIA (CBS) -- Just in time for the holiday season, there's a new kind of gift card on store shelves this year.
It's part of what some say is a new innovative way to invest. But it is a savvy deal? Some experts say watch out.
At one Wegman's supermarket, the freshest items on the shelf include Coca-Cola and Apple, but not the products.
Instead it's stock in the companies, being sold for the first time as gift cards.
The new gift cards were rolled out in October by Stockpile, a Silicon Valley startup, and can be used to buy stock in 20 big-name companies.
Avi Lele is Stockpile's founder and CEO. He says, "we're bringing Wall Street to America. People have never been able to own a stock and get started as quickly as you can here."
"There's really more steps to the process," says New York financial writer Gregg Brewer.
He points out that the fees can be the equivalent of up to 20%, the recipient must open a brokerage account and can redeem it for something other than stock despite the gift-giver's intention.
Plus there's a 99-cent fee to sell the stock.
According to Brewer, "as an investment, I'd say that this is a pass for the vast majority of people."
But Lele would likely disagree. He says, "I think it's here to stay because we are seeing growth."
In fact, Stockpile plans to add even more retailers next year.
The stock gift cards are sold in denominations of $25, $50, or $100 dollars.
The person buying the gift card pays most of the fees on top of the cost of the card.
Stockpile says so far, most of its customers are those over 30 years old buying for people under the age of 30.