What are fractional shares and how do they benefit small investors?
Fractional trading | Image Resource: interactivebrokers.com The prices of the shares of big names come with a price tag. If you do not have enough money to buy a whole share then you can buy a portion of the share. Fractional shares are a part of the whole share and allow you to buy expensive shares and ETFs. You can buy fractional shares for an amount as low as Rs. 1. Fractional shares are a boon for new investors as it helps them to diversify their portfolio by investing in companies that otherwise may be out of reach. There are many reasons to buy fractional shares. You may not have enough money to buy a full share or you may want to invest a fixed amount of money rather than buy a round number of shares. How fractional shares are formed? Fractional shares are a new development previously it was impossible to buy less than a share. You can own fractional in the following ways: A company splits its stocks and agrees to give the shareholders an additional share of stocks. For ex...