What are FRACTIONAL STOCK SHARES?

Information that Physician Investors Should Know?

By Staff Reporters

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DEFINITION: Fractional shares are partial shares of a company’s stock. Instead of owning one or more full shares of the stock, you own a portion, or fraction, of one. In the past, investors generally would end up with fractional shares only after a stock split, since brokers allowed the purchase of full shares only.

CITE: https://www.r2library.com/Resource/Title/082610254

  • A fractional share is a portion of an equity stock that is less than one full share.
  • Fractional shares often result from stock splits, which don’t always result in an even number of shares.
  • Mergers or acquisitions create fractional shares, as companies combine new common stock using a predetermined ratio.
  • Fractional shares can make it easy to buy very small stakes in many different companies. But, if your brokerage charges commissions, you might wind up paying a lot of fees due to the temptation to invest in many different companies.

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Stock too Pricey? Try Partial Shares. - WSJ

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READ: https://www.mybanktracker.com/blog/investing/fractional-shares-310822

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