Fractional shares are pieces, or fractions, of whole shares of a company or ETF. Since Robinhood Financial offers Fractional Shares, you can trade stocks and ETFs in pieces of shares, in addition to trading in whole share increments.
Fractional shares on Robinhood can be as small as 1/1000000 of a share, and trading fractional shares is real-time and commission-free.
Fractional Shares will be rolling out to all customers in the next few months. You can sign up for early access in the Robinhood app or website.
Our mission is to democratize financial services, and our Fractional Shares feature provides unique investing opportunities to people who might not otherwise be able to participate in the stock market.
With fractional shares, you can invest in stocks and ETFs that cost hundreds or thousands of dollars for a single share with as little as $1. This gives you the flexibility to invest as much as you want in the companies or ETFs you believe in, or get your toes wet without committing to an entire share.
Fractional shares can also help investors manage risk more conveniently. Since you’re not locked into purchasing full shares, you can diversify your portfolio with smaller amounts of money.
You can place real-time fractional share orders in dollar amounts or share amounts. All purchases will be rounded to the nearest penny.
Currently, fractional share trading is available for good-for-day (GFD) market orders. Also, extended hours aren’t supported for fractional share orders.
If you place a market order to Buy in Dollars or Sell in Dollars, you’ll choose the amount of money to buy or sell a stock for. Robinhood will convert this cash amount to the equivalent number of shares, then buy or sell the stock at the best available price.
In the app:
Then, enter the dollar amount you’d like to trade.
Keep in mind, if you’re buying or selling fractional shares, you must enter an amount of at least $1.00. However, you’ll have the option to “Sell All” if you have less than $1.00 of any fractional share.
MEOW currently costs $100 per share. You place a market order to Buy in Dollars for $10 of MEOW during regular trading hours. Robinhood converts $10 to 0.1 shares based on the current market price, then places an order to immediately purchase 0.1 shares at the best available price.
If you place a market order to Buy in Shares or Sell in Shares, you’ll choose the amount of shares to buy or sell. You can buy or sell as little as 0.000001 shares.
In the app:
Please note that orders above $0.01 will be rounded to the nearest penny, and fractional share orders under $0.01 will be rounded up to $0.01.
You place a market order to Buy in Shares for 0.001 of WOOF during regular trading hours. Your order will be executed immediately, and you’ll purchase 0.01 shares at the best available price. If the best available price is $1,000 per share, you will pay $10.
Stocks worth over $1.00 per share with a market capitalization over $25,000,000 are eligible for fractional share orders. If a stock isn't supported, we'll let you know when you're placing an order.
We will aggregate and report votes on fractional shares.
Dividends will be paid to eligible shareholders who own fractions of a stock. Dividend payments will be split based on the fraction of the stock owned, then rounded to the nearest penny. Please note that fractional share dividends may be paid at the end of the trading day on the designated payment date.
You won’t be able to transfer fractional shares. If you initiate a full asset transfer out of Robinhood, your fractional shares will be sold and you’ll receive the resulting cash back. If you initiate a partial asset transfer, any fractional shares you own will remain in your Robinhood Securities account as fractional shares.
If a stock experiences a forward stock split or a reverse stock split, you’ll receive the relevant amount of fractional shares. For example, if you own 2.5 shares of MEOW valued at $10 per share, and MEOW experiences a 2 for 1 (2:1) forward stock split, you’ll now own 5 shares valued at $5 per share.
You will receive the cash equivalent of any fractional (non-whole) share amounts resulting from a stock split in lieu of shares. For example, if a stock split results in 2.1 shares worth $10 per share, you’ll receive 2 shares and $1 (the cash equivalent of 0.1 shares).