THERE is very little excuse nowadays for even the smallest of investors buying unsound securities. Formerly only the fakers offered stocks and bonds in small amounts or on easy terms. There was the savings-bank, sound as a rock, but never offering more than four per cent. and in many cases presenting to the investor an impersonal cold indifference.

But to-day there are hundreds of good bonds and mortgages to be had on easy terms, often beginning with as little as five dollars. Where formerly brokers on the New York and other reputable stock exchanges showed little interest in small purchases, there are now scores of reliable brokers who are only too glad to buy anywhere from one to ten shares of stock for any respectable customer.

There is no longer any reason for envying the "bloated bondholder." If you have five dollars or ten dollars you can begin to become one. The one-hundred-dollar bonds are called "baby" bonds, but babies grow up, and from these small beginnings large accumulations grow. The only way to become a large investor is to start as a small one.

There are ample facilities and machinery for supplying the investor with sound small securities. We have not reached the position of France where peasants buy a few francs' worth of government bonds. But the conditions are so different in many ways that such a comparison is hardly fair to this country. The fact remains, however, that not only in New York and Chicago, but in many smaller cities, there are banks, trust companies, investment bankers, brokers and dealers in mortgages who stand ready to supply the small investor with good securities on the easiest terms possible. Ask your local banker to name the nearest dealer in good small securities whom he can recommend. Perhaps the cashier or vice-president of your bank can arrange to buy the bonds for you.

When you buy one-hundred-dollar bonds, you are buying the same bonds that another buys when he invests his one thousand dollars, ten thousand dollars or one hundred thousand dollars. You get a bond issued by the same company, on the same property. The interest and principal are payable at the same time. The security is identical. As a rule it costs only a fraction more, sometimes no more, than the larger bond.

You have in reality one decided advantage in buying one-hundred-dollar bonds. If you have on hand insufficient money to buy a one-thousand-dollar bond, you need not wait until you have saved the whole one thousand dollars. You may buy a one-hundred-dollar bond at once. You may buy another one-hundred-dollar bond when you have saved some more. And so on. All the time, you may receive interest on the money greater than you would receive from a bank.

If you have on hand sufficient money to buy one one-thousand-dollar bond, you may buy ten one-hundred-dollar bonds. In diversifying your investment, placing some of it perhaps in city bonds, some in railroad bonds, some in industrial bonds and some in public utility bonds, you increase the safety of your investment in much the same way that a bank protects its investments.

Another advantage of having small bonds is that they often serve as satisfactory collateral for a loan at your bank, if you need money and yet don't want to sell your bonds.

In buying one-hundred-dollar bonds it is important to purchase only the safer and less speculative issues. There are some dealers in these small investments who quote and advertise all the bonds in their line, but when a prospective customer actually writes for further information they urge him to take some of the less known, less secure, very high yield, unseasoned securities, on which their own profit happens to be greater than on the better class goods.

Large banks are in many instances offering their depositors the combined advantages of a savings-deposit and one-hundred-dollar bonds. One of the first banks to adopt this plan thus explains its terms:

"As a member of our Savings Investment Club you may deposit one dollar per week; we will allow you three per cent. interest per annum on your weekly deposits and when you have the sum of fifty dollars to the credit of your account will lend you fifty dollars. This amount (one hundred dollars) will enable you to purchase a bond (to be held as security for your loan), which will yield a higher rate of interest.

"Your weekly deposits are to be continued until you have a sufficient amount to pay off your loan, at the end of which time you will be in possession of the bond and be ready to start a fund for your second bond. Or you can become a member of a club in which you make weekly deposits of two dollars, five dollars, ten dollars or more, and purchase a five-hundred-dollar or one-thousand-dollar bond."

The plan is sound. Its main advantage to the depositor is that most of his savings draw bond interest instead of savings-bank interest. If the income yield of the bond is higher than the interest rate he pays the bank on his fifty-dollar note, he makes a further profit. If the yield on the bond and the interest on the note are equal, the transaction will reach the same result as if he bought two fifty-dollar bonds, one after the other. Some institutions offer the same arrangement proportionately to savings depositors who wish to buy five-hundred-dollar and one-thousand-dollar bonds.

The partial payment, or instalment, method of buying stocks and bonds is being used more and more. It is a great incentive to thrift, a great help to the small investor. But I want to warn readers that almost any instalment method of purchasing goods has its dangers. Stocks, bonds and mortgages are not actually delivered to customers until fully paid for. In case of the failure of the broker or banker the part paid purchaser may have difficulty in obtaining his securities or even the money paid in.

Therefore everything depends on the reliability of the broker or banker. If he is strong, then the plan will prove safe. In actual practise on the New York Stock Exchange at least, there have been no failures due to the partial payment plan, and there have been few, if any, losses.

The essentials of the plan may be briefly explained. An initial payment of from five dollars to fifty dollars, usually about ten dollars, a share is made. Then a regular payment of five dollars a share on the first of each month is made until the stock is paid for in full, when it is actually delivered to the buyer. In the meanwhile he receives all the dividends or interest that comes from the stocks or bonds, and himself pays interest, usually at the rate of about six per cent., to the broker on the unpaid instalments. There is steady pressure to save, and the agreeable feeling of being on the way to actually owning a share of stock or a bond.

If the investor feels he can not meet his payments he always has the privilege of demanding delivery from the broker of such proportion of the stock as has been paid for. Of course this would not be practical where only one share is purchased.

In buying single shares of stock, or any number less than one hundred shares on the New York Stock Exchange, a slightly higher price, usually one-eighth of one per cent. is paid. This is not true of all other stock exchanges. Usually no broker will buy any stock, no matter how few the shares, for a total commission of less than one dollar and twenty-five cents. These remarks apply to stocks bought through a broker on a stock exchange. Where a dealer in securities has them on hand for sale and does not have to go to the exchange to buy them he charges no commission. Where a commission is charged the broker makes no other profit. Of course where no commission is charged the broker has himself bought the stock at a lower price and makes his profit by the difference in price. Where a commission is charged the broker simply turns the stock over to his customer at the same price, plus the commission, which he paid for it.