Best Brokers For Fractional Share Investing

Fractional shares allow investors to purchase a stock or ETF with almost any amount of money, which means you don’t have to wait until you can afford to buy a full share of a high-priced stock like Costco or Meta to add it to your portfolio. The ability to buy fractional shares for as little as $1 at a time is particularly useful for investors just starting out and those with more modest budgets.

Here are some of the benefits of fractional share investing:

• Fractional shares ensure that all of your money can be invested, rather than there being a leftover cash balance because you couldn’t purchase another whole share.
• You can invest in dividend stocks using fractional shares and receive dividends in proportion to your investment. For example, if a company pays a dividend of $1 per share and you own 0.50 shares, you’ll receive a 50-cent dividend.
• Fractional shares can make it easier to build a diversified portfolio. If you have $500 to invest and a company you’re interested in trades for $250 per share, that’s half of your money. Buying a piece of a share frees up more money for other stocks, which could lead to a more balanced investment mix.
• The ability to invest via fractional shares makes it much easier to use dollar-cost averaging.

There are few negatives when it comes to using fractional shares to invest, though if you want to transfer shares to a different broker, you may have to sell your fractional shares before the transfer can take place. Otherwise, fractional shares are a great way for those starting with small sums to participate in the stock market.

The online stock brokers below all offer fractional share investing. 

Best online brokers for buying fractional shares:

Top online brokers for buying fractional shares

Charles Schwab

Charles Schwab’s Stock Slices allows investors to buy a fractional share of any stock in the Standard & Poor’s 500 Index with as little as $5. Customers can buy up to 30 slices at a time. And like trades for regular shares, you’ll be able to place your trades without a commission. You’ll continue to be able to reinvest any dividends from your stocks into fractional shares of the same stock.

• Fractional purchases: Yes
• Securities in the program: About 500, including all stocks in the S&P 500
• Fractional dividend reinvestment: Yes

Fidelity Investments

Fidelity is routinely a top contender among brokerages, so it’s not surprising that the broker features a way to buy fractional shares, which it calls Stocks by the Slice. You can start with just $1 and buy shares of more than 7,000 stocks and ETFs listed on U.S. exchanges. You’ll still be able to purchase stocks with zero trading commissions for online U.S. stock and ETF trades, and you’ll also be able to reinvest your dividends in more shares, even fractional shares, whether they’re stocks or ETFs.

• Fractional purchases: Yes
• Securities in the program: More than 7,000 stocks and ETFs
• Fractional dividend reinvestment: Yes

Interactive Brokers

Long known as a high-powered alternative for professional and active traders, Interactive Brokers also offers fractional shares, which is a boon to investors without deep pockets. You can purchase fractional shares on the broker’s Pro platform (cost: the greater of 1% of the trade value or $0.01) or on its Lite platform, where trading is free. The downside here is that dividend reinvestment costs the standard commission on the Pro tier, though it’s free on the Lite tier. Also, stocks with lower daily volumes and market caps may not be available. Also eligible: ETFs, Canadian stocks and ETFs, and European stocks.

• Fractional purchases: Yes
• Securities in the program: More than 10,500 stocks and ETFs
• Fractional dividend reinvestment: Yes

Robinhood

Robinhood has long been known for its commission-free trading (which extends to options, too), but it also allows you to buy the tiniest fraction of a share. Yes, you can buy as little as one-millionth of a share of your favorite stocks, and you can buy a huge variety of stocks as well. Stocks trading over $1 per share and with a market capitalization greater than $25 million are eligible for the program, and ETFs are available for fractional shares, too. You can also reinvest dividends into fractional shares but you must enable the fractional feature first.

• Fractional purchases: Yes
• Securities in the program: Thousands of ETFs and stocks above the volume and size thresholds
• Fractional dividend reinvestment: Yes

Firstrade

Firstrade offers the usual commission-free stock and ETF trades and even commission-free options trades. Its fractional share program includes more than 4,000 stocks and ETFs available for as little as $5. Plus, the broker offers the ability to reinvest dividends into partial shares.  

• Fractional purchases: Yes
• Securities in the program: More than 4,000 stocks and ETFs available
• Fractional dividend reinvestment: Yes

Vanguard

Vanguard allows fractional share investing, but only in its own mutual funds and ETFs, not stocks or non-Vanguard ETFs. The broker does allow you to reinvest dividends in stocks, ETFs and mutual funds. However, Vanguard will not reinvest in certain low-volume stocks, some U.S. stocks and all foreign stocks.

• Fractional purchases: Yes
• Securities in the program: Vanguard ETFs and mutual funds
• Fractional dividend reinvestment: Yes

Tastytrade

Tastytrade is one of the best brokers for short-term traders, but with the addition of fractional shares for both purchases and dividend reinvestment, it’s now a more interesting option for long-term investors, too. There’s a $5 minimum purchase requirement and all fractional share trades incur a $0.10 clearing fee per transaction.

• Fractional purchases: Yes
• Securities in the program: Thousands of stocks and ETFs
• Fractional dividend reinvestment: Yes

SoFi Active Investing

SoFi Active Investing is one of the best brokers for low costs, and it extends that leadership to fractional shares, too. At SoFi, you’ll be able to buy fractional shares directly for a minimum of $5 and reinvest your dividends into fractional shares, a combo that is not always available at brokers offering partial shares. To reinvest dividends, the stock price must be greater than $4 per share, which includes most U.S. stocks and foreign stocks trading on U.S. exchanges.

• Fractional purchases: Yes
• Securities in the program: More than 4,000 stocks and ETFs
• Fractional dividend reinvestment: Yes

WellsTrade

WellsTrade entered the fractional share game in late 2023 with the launch of Stock Fractions, which offers access to hundreds of stocks and ETFs with a minimum of $10 per order. WellsTrade allows investors to choose which stocks and funds reinvest dividends on an individual basis.

• Fractional purchases: Yes
• Securities in the program: Hundreds of stocks and ETFs
• Fractional dividend reinvestment: No

E-Trade

E-Trade doesn’t allow investors to purchase partial shares of stock, but you can reinvest dividends into fractional shares. And E-Trade does allow you to set up automatic investments in ETFs and mutual funds for as little as $25, meaning that you can still acquire fractional shares in these securities.

• Fractional purchases: No
• Fractional dividend reinvestment: Yes
• Securities in the program: Thousands of stocks and ETFs can have dividends reinvested

Merrill Edge

Merrill Edge is another broker that allows dividend reinvestment in fractional shares but doesn’t let clients purchase fractional shares directly. Merrill lets investors reinvest dividends from stocks and ETFs as well as mutual funds. With an online selection, you can quickly set up whether you want each security in your portfolio to reinvest, and if you change your mind, you can flip your choice later on just as easily.

• Fractional purchases: No
• Fractional dividend reinvestment: Yes
• Securities in the program: Thousands of stocks, ETFs and mutual funds