Here's a statement of the obvious: The opinions expressed here are those of the participants, not those of the Mutual Fund Observer. We cannot vouch for the accuracy or appropriateness of any of it, though we do encourage civility and good humor.
Support MFO
Donate through PayPal
Fidelity offers ETF trades in dollars (instead of shares)
Mobile app only: "Dollar-based investing makes it easy to buy fractional shares. Own a piece of your favorite companies and exchange-traded funds (ETFs) based on how much you want to invest."
I finally tried this out a week ago. A nuisance to trade on a mobile device (the only platform Fidelity supports for fractional shares). But since I had already loaded the application to deposit the infrequent paper check, it wasn't that a big deal.
No problem, very smooth operation. I used it to buy a cash substitute ETF in an IRA. That seems like an ideal use of this feature, since cash is tracked in dollars and cents.
It worked slightly differently from the way one would by an OEF. When one buys an OEF by dollar amount, one gets a certain number of shares (calculated to three places). No cash remains in the account, even if the number of shares purchased are worth a penny or two less that the size of your order.
With my ETF purchase, the number of shares was also calculated out to three decimal places. But I was left with 2¢ cash in my account.
Schwab finally followed through with its earlier announcement of fractional shares. Seeing that it doesn't handle ETFs, it doesn't handle stocks outside of the S&P 500, and it doesn't handle amounts under $5, it really is a day late and a dollar short. https://www.schwab.com/fractional-shares-stock-slices/gift
Comments
https://www.etftrends.com/core-etf-channel/how-will-schwabs-move-toward-fractional-shares-affect-etfs/
A few other (read smaller) platforms offer some ability to trade fractions of ETFs. For example, M1 Finance and Bettterment.
https://www.etf.com/publications/etfr/fight-fractional-etf-trading?nopaging=1
No problem, very smooth operation. I used it to buy a cash substitute ETF in an IRA. That seems like an ideal use of this feature, since cash is tracked in dollars and cents.
It worked slightly differently from the way one would by an OEF. When one buys an OEF by dollar amount, one gets a certain number of shares (calculated to three places). No cash remains in the account, even if the number of shares purchased are worth a penny or two less that the size of your order.
With my ETF purchase, the number of shares was also calculated out to three decimal places. But I was left with 2¢ cash in my account.
Schwab finally followed through with its earlier announcement of fractional shares. Seeing that it doesn't handle ETFs, it doesn't handle stocks outside of the S&P 500, and it doesn't handle amounts under $5, it really is a day late and a dollar short.
https://www.schwab.com/fractional-shares-stock-slices/gift