Can You Still Get Stock Certificates?

It is still possible to obtain physical stock certificates, though the process has become less common and often involves specific steps and potential fees. While most stock ownership is now recorded electronically, some companies and investors continue to engage with paper certificates under certain circumstances.

Evolution of Stock Ownership

Historically, physical stock certificates served as tangible proof of ownership in a company. Before widespread computerization, these certificates were the primary method for tracking and transferring stock ownership. The physical transfer of certificates when shares were bought or sold was often slow and cumbersome.

Beginning in the 1960s, computer technology led to the “dematerialization” of securities. This shifted ownership from physical certificates to electronic bookkeeping, improving efficiency, reducing costs, and enhancing security. The Depository Trust Company (DTC), established in 1973, became a central securities depository, playing a crucial role by recording ownership changes through a “book-entry” system.

The DTC’s system streamlines securities transfers, allowing electronic transfers instead of physical delivery. This significantly increases efficiency and reduces costs in the securities industry. Most banks and brokerage firms participate in the DTC, depositing client securities with the organization.

Current Availability of Physical Certificates

Today, most publicly traded companies no longer issue physical stock certificates by default. The majority of shares are held electronically, either through a brokerage account in “street name” or directly registered with the company’s transfer agent via the Direct Registration System (DRS).

Some investors still prefer physical certificates for personal reasons, such as their historical value, aesthetic appeal, or as a tangible memento of their ownership. Certain types of shares, like those of some private companies or those acquired through direct stock purchase plans, might still offer physical certificates. Gifting shares is another scenario where a physical certificate may be desired to provide a tangible representation of the gift.

Transfer agents play a central role in the issuance and management of physical stock certificates. These agents are companies appointed by the issuing corporation to maintain records of registered shareholders, handle stock transfers, and facilitate communications between the company and its shareholders. If shares are held directly with the transfer agent through DRS, they are recorded electronically in the shareholder’s name on the company’s books, and a physical certificate can often be requested directly from them.

Steps to Obtain a Physical Certificate

Obtaining a physical stock certificate typically depends on how your shares are currently held. If your shares are held in a brokerage account, the first step is to contact your broker directly to inquire about their process for issuing a physical certificate. Many brokerage firms can facilitate this request, but they may charge a fee for the service, which can range from approximately $25 to $500 per certificate. It is advisable to ask your broker about the specific fee and the estimated processing time, which could take several days to a few weeks.

If your shares are held directly with the company’s transfer agent through the Direct Registration System (DRS), you can contact the transfer agent to request a physical certificate. Information for the transfer agent can usually be found on the company’s investor relations website or in their annual report. When requesting a certificate, you may need to submit a written request and complete a stock certificate form, providing details such as your account number and the number of shares.

A Medallion Signature Guarantee is often required for transferring or obtaining physical certificates. This special stamp from a financial institution, like a bank or credit union, verifies your signature’s authenticity and confirms your legal capacity to sign. Financial institutions providing this guarantee must be members of programs such as the Securities Transfer Agents Medallion Program (STAMP). This guarantee protects against fraudulent transfers and is distinct from a notary public’s seal.