Best Brokers for Fractional Share Investing in 2025

Best Brokers for Fractional Share Investing

Fractional shares have revolutionized investing by making it possible for anyone to own a piece of expensive stocks, regardless of their budget. Whether you’re a beginner investor with limited capital or an experienced trader looking to diversify, fractional share investing offers flexibility and accessibility. In 2025, numerous brokers have embraced this feature, making it easier than ever to start building a portfolio with minimal upfront investment.

What Are Fractional Shares?

Fractional shares represent portions of a whole share of a company’s stock or an exchange-traded fund (ETF). Instead of purchasing an entire share, investors can buy a fraction, allowing them to invest amounts that align with their financial goals. For example, if a single share costs $100, an investor with $50 can acquire 0.5 shares. This approach makes higher-priced securities accessible to a broader audience, enabling dollar-cost averaging strategies and more efficient capital allocation.

Top Brokers for Fractional Shares

Fidelity

Fidelity stands out as one of the largest and most well-established brokerages, offering comprehensive fractional share investing options. The broker charges no trading commissions on stocks and ETFs, and investors can get started with as little as $1 through Fidelity’s Stocks by the Slice offering. This program provides access to thousands of stocks and ETFs with minimal barriers to entry.

Fidelity offers approximately 7,000 US fractional shares available for purchase. Beyond commission-free trading, Fidelity excels in research resources and customer service. The platform provides extensive reports, educational webinars, and recorded content covering various investing topics. Fidelity also features a renowned trading platform and strong customer support, making it ideal for both beginners and experienced investors.

Interactive Brokers IBKR Lite

Interactive Brokers IBKR Lite receives a perfect 5.0/5 rating and offers commission-free stock trading with an industry-leading selection of fractional investments. The platform provides access to over 10,500 US fractional shares, significantly more than competing brokers. IBKR Lite features zero account minimums and charges $0 per trade, making it highly accessible.

The platform allows clients to pick any eligible US, Canadian, or European stock (or ETF, where available) and decide how much they want to invest. This flexibility, combined with international trading capabilities and access to more than 19,000 mutual funds, positions Interactive Brokers as a comprehensive solution for serious investors. However, the website interface can be challenging for beginners, and there’s a relatively high minimum to earn interest on uninvested cash.

Firstrade

Firstrade earns a 4.5/5 rating and offers commission-free trading in stocks, ETFs, and options—a rare combination among brokers. The platform allows fractional share purchases starting at just $5, making it accessible to cost-conscious investors. Additionally, Firstrade offers dividend reinvestment in partial shares, a feature particularly valuable for long-term investors.

One of Firstrade’s standout features is commission-free mutual fund trading, with access to more than 11,000 mutual funds. For options traders, the broker charges no contract fees, another rarity in the industry. Firstrade also provides solid research offerings through Morningstar and other providers, plus a highly-rated mobile app with advanced features. New account transfers receive up to $250 in transfer fee rebates.

Robinhood

Robinhood earns a 4.5/5 rating with $0 commissions on trades of stocks, ETFs, and their options. The broker features a streamlined interface designed for accessibility and simplicity. New users receive 1 free stock after linking their bank account, with stock values ranging from $5 to $200.

Beyond fractional shares, Robinhood offers cryptocurrency trading and an IRA with a 1% match (3% for Gold members). The platform provides high interest rates on uninvested cash, helping investors maximize returns on cash balances. However, some users note that other fees may apply depending on specific transactions or account types.

Schwab Stock Slices

Charles Schwab offers Schwab Stock Slices, its fractional shares offering, allowing investors to purchase partial shares starting at just $5. The platform enables buying shares from up to ten S&P 500 companies for $5 each, providing an easy entry point for portfolio construction. Schwab provides approximately 500 fractional shares available for purchase.

New investors can receive up to a $1,000 bonus with a qualifying deposit and a referral code from a friend. The broker offers a fully featured mobile app alongside desktop capabilities, enabling investors to access virtually all platform features on the go. Schwab’s beginner-friendly approach, combined with competitive commission-free trading and fractional share options, makes it an attractive choice for new investors.

SoFi Active Investing

SoFi Active Investing delivers strong value for newer investors, offering no commissions on stocks, ETFs, and options. The platform’s fractional share plan allows clients to purchase partial shares of stock and reinvest any dividends in them, helping ensure all investment capital works efficiently. This automated dividend reinvestment feature is particularly beneficial for long-term wealth building.

SoFi offers solid educational content to help clients understand investing fundamentals. The brokerage account integrates well for existing SoFi customers, particularly those utilizing loans or bank accounts with the company. This integration streamlines account management and potentially offers additional benefits through cross-platform relationships.

Webull

Webull offers fractional shares trading, allowing investors to get started buying certain stocks and ETFs for as little as $5. The platform provides educational content for beginners learning the basics of financial markets and investing strategies. This educational focus, combined with low fractional share minimums, makes Webull accessible to newcomers in the investing world.

Fractional Shares of ETFs

While most brokers focus on fractional shares of individual stocks, some specialized options exist for exchange-traded funds. Vanguard offers fractional share purchases of Vanguard ETFs exclusively. Although Vanguard didn’t make the primary list due to this limitation, its ETFs remain popular choices among investors, and the broker is worth considering if you specifically want to purchase fractional shares of Vanguard ETFs.

Key Benefits of Fractional Share Investing

Fractional share investing provides numerous advantages for modern investors:

Lower Barriers to Entry

The most obvious benefit is accessibility. With fractional shares, investors can start with amounts as low as $1 to $5, making investing feasible for anyone. This democratization of investing eliminates the traditional barrier of needing thousands of dollars to purchase expensive stocks.

Portfolio Diversification

Fractional shares enable investors to allocate money across multiple stocks, achieving better portfolio diversification. Instead of concentrating funds in a single affordable stock, investors can spread capital among numerous companies, reducing risk through diversification.

Dollar-Cost Averaging

Fractional shares facilitate dollar-cost averaging strategies, where investors invest fixed amounts regularly over time. This systematic approach reduces the impact of market volatility and can lead to better long-term returns through disciplined investing patterns.

Efficient Capital Utilization

Fractional shares ensure small cash balances are put to work quickly, maximizing potential returns. This efficiency means no cash sits idle in accounts, as even small amounts can be invested across multiple securities.

Choosing the Right Broker for Fractional Shares

When selecting a broker for fractional share investing, consider several factors:

Commission Structure

Most modern brokers offer commission-free trading on stocks and ETFs. Ensure the broker you choose provides zero commissions on fractional share trades, eliminating hidden costs that could erode your investment returns.

Account Minimums

Top fractional share brokers maintain zero account minimums, allowing you to start with any amount. Verify that your chosen platform doesn’t require a minimum deposit to open an account.

Available Securities

Different brokers offer varying numbers of fractional share options. Interactive Brokers leads with over 10,500 fractional shares, while Fidelity offers approximately 7,000. Consider which stocks or ETFs you want to invest in and ensure your chosen broker supports them.

Minimum Investment Amount

While most brokers allow fractional share purchases starting at $1 to $5, verify the specific minimums. Some brokers may have higher minimums for certain securities or account types.

Research and Educational Resources

Fidelity excels in providing comprehensive research tools, webinars, and educational content. Assess how important research and learning resources are for your investing journey and choose accordingly.

Mobile App Quality

Since many modern investors use mobile platforms, evaluate each broker’s app functionality and user experience. Platforms like Firstrade and Schwab offer highly-rated mobile apps with advanced features accessible on the go.

Comparison Table: Top Fractional Share Brokers

Example: How Fractional Shares Work

Let’s examine practical examples of fractional share investing. If Meta (META) trades at $627.08 per share, you could invest $25 to purchase approximately 3.99% of one share. Similarly, if Google (GOOG) trades at $291.74 per share, a $25 investment would grant you approximately 8.57% of one share.

These examples demonstrate how fractional shares enable precise capital allocation. Rather than choosing between buying zero shares or one full share, you can invest exactly the amount you want, regardless of the share price.

Getting Started with Fractional Shares

Beginning your fractional share investing journey is straightforward:

Step 1: Choose Your Broker – Select from the recommended brokers based on your needs, investment amount, and preferred features.

Step 2: Open an Account – Complete the account opening process, typically requiring basic personal information and funding your account.

Step 3: Fund Your Account – Link your bank account and transfer funds, even small amounts like $1 to $5.

Step 4: Select Securities – Research and choose stocks or ETFs you want to invest in through your broker’s platform.

Step 5: Purchase Fractional Shares – Enter your desired investment amount and execute the purchase.

Step 6: Monitor and Rebalance – Track your investments and adjust your portfolio as needed to maintain your desired allocation.

Frequently Asked Questions

Q: What is the minimum amount needed to start investing in fractional shares?

A: Many brokers allow you to start with as little as $1. Fidelity’s Stocks by the Slice program and Interactive Brokers IBKR Lite both support minimal investments, making investing accessible to everyone.

Q: Are there any hidden fees with fractional share investing?

A: Most major brokers offer commission-free trading on fractional shares. However, other fees may apply depending on account type, such as inactivity fees or fees for broker-assisted trades. Always review your broker’s fee schedule carefully.

Q: Can I reinvest dividends from fractional shares?

A: Yes, many brokers like SoFi and Firstrade allow dividend reinvestment in partial shares, enabling automatic reinvestment of dividends to compound your returns over time.

Q: Which broker offers the most fractional share options?

A: Interactive Brokers IBKR Lite leads the market with over 10,500 US fractional shares available for purchase, providing the broadest selection among major brokers.

Q: Is fractional share investing suitable for beginners?

A: Absolutely. Fractional share investing is ideal for beginners because it lowers barriers to entry, enables portfolio diversification with minimal capital, and allows investors to learn through small, manageable investments.

Q: Can I use fractional shares for long-term investing strategies?

A: Yes, fractional shares work well for long-term strategies including dollar-cost averaging, dividend reinvestment, and buy-and-hold investing. They enable consistent, small investments over time to build wealth.

Q: What are the tax implications of fractional share investing?

A: Fractional shares are taxed the same as whole shares. You’ll owe capital gains taxes on profits and may receive dividend income. Consider consulting a tax professional for personalized advice based on your specific situation.

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medha deb

 

Medha Deb is an editor with a master's degree in Applied Linguistics from the University of Hyderabad. She believes that her qualification has helped her develop a deep understanding of language and its application in various contexts.

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