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Fractional Shares

Trading Term

Fractional shares allows traders to invest in eligible US or European stocks and ETFs based on a dollar amount so the trader may end up with a partial share amount instead of whole shares. Trading fractional shares allows for investing in companies in which the investor may not be able to afford the full share price. It also makes it easier to diversify their portfolio by allowing investors to trade fractional amounts in multiple companies when they otherwise may have only been able to trade whole shares in one or two companies. If clients enable their account to trade in fractions, they may buy a fraction of a share based on the amount of cash you specify. For example, if an investor wants to spend $50 but one share of the stock is currently $100, the investor would end up with 0.5 shares. If the investor would like to short a fractional share, they can do so by specifying the fractional share quantity (for example, sell 0.25 shares).”

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