(MONEY Magazine) – There's only one surefire approach to beating the market: Start with an instant profit. Sound impossible? Well, it isn't. There's a safe way, known as a dividend-reinvestment plan (DRIP), that you can use to buy stocks nearly commission-free -- and get a discount on the share price to boot. Though your ultimate profits would depend on the performance of the specific stocks you choose, the savings you can get buying through DRIPs would help maximize your gains. Here's how the plans work: More than 900 companies offer investors the chance to reinvest cash dividends in extra shares of stock. Most plans also permit investors to purchase additional shares with other cash -- often as little as $10 -- on a weekly, monthly or quarterly basis. Some 600 DRIPs charge nothing to reinvest your dividends in extra shares of the company. Most other plans charge $5 or less per transaction. Commissions for additional shares bought with cash other than dividends typically run $25 or less, regardless of the size of the purchase. That's a bargain compared with the $35 to $55 minimum per transaction that most discount brokerages charge. Even better, about 100 companies give investors a small discount, typically 3% to 5%, on shares bought through DRIPs. The table opposite lists 35 of those whose shares are rated average or lower for risk and average or better for potential profits by the Value Line Investment Survey. Why do the companies offer such breaks? Most firms prefer to have small investors as shareholders because they are loyal -- and they make good customers. "If you're a McDonald's shareholder, you're more likely to buy a Big Mac than a Burger King Whopper," says Charles Carlson, editor of the newsletter DRIP Investor ($59 a year; 219-931-6480). To get started with DRIP investing, you usually have to be a shareholder of record at a firm. If you already own the stock in a brokerage account, all you have to do is ask your broker to register it in your name rather than the brokerage's name. Once you have stock in your own name, the company will probably automatically send you the forms to enroll in its plan. If they don't, you can call and request them. If you don't own the stock, a DRIP may offer a cheap way to acquire it. Most plans will enroll you if you own as little as a single share. And with five of the companies in the table, enrollment entitles you to discounts on cash purchases. Say, for example, you want to own 100 shares of First Interstate Bancorp., trading at $56.75. You can buy your single share at a brokerage, paying a commission of about $50, and then purchase 99 shares directly from the company, commission-free and at a 3% discount. Total saving over buying all 100 shares from the broker: $225. You can use this technique to buy stocks on the cheap whether you are interested in the long-term benefits of dividend reinvestment or not. But note: Those benefits can be awesome. "Over the past 15 years, Standard & Poor's 500-stock index appreciated 333%, not counting dividends," says Bill Staton, editor of the newsletter Money Advisory ($89 a year; 800-889-2378). "But with dividends reinvested quarterly, the return was 724%." Before plunging ahead, however, you should be aware of two minor disadvantages of DRIP accounts. First, you can't act on short notice. "It can take several weeks to buy or sell shares that are in the account," says Maria Crawford Scott, editor of the American Association of Individual Investors Journal ($49 a year; 312-280-0170). Second, record keeping for tax purposes is a nuisance. If you lose track of your frequent purchases, you could easily end up overestimating your gain when you sell and paying unnecessary capital-gains tax. So it's vital to hang on to all your year-end statements. Still, that's a small price to pay for an almost effortless way to superior stock market profits.

CHART: NOT AVAILABLE CREDIT: Sources: American Association of Individual Investors; Value Line Investment CAPTION: STOCKS YOU CAN BUY AT A DISCOUNT The 35 companies listed here have dividend-reinvestment plans (DRIPs) that allow you to buy shares at discounts of as much as 5%. These businesses all have more than $500 million in annual revenues or assets. In addition, the Value Line Investment Survey rates the stocks average or lower for risk and average or better for potential profits. (Stocks with superior prospects for gains are noted.) Stocks trade on the New York Stock Exchange, except where otherwise noted.