Fractional shares (UK)

the feather I am looking forward to the most is the ability to buy fractional shares, but what i want to know will you be able sell fractional share or can you only sell whole shares

thank you, hope you guys know the answers

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You certainly will be able to buy and sell fractional shares. The only thing to be aware of is that free trades are executed at the end of the day, not when you raise your trade request.

As per the latest information on the help page

Yes, we will offer fractional share trading on US stocks and ETFs.

We won’t be offering fractional share trading on UK stocks.

Fractional trading allows you to own less than a complete share. For example, if a stock is trading at $100, you could invest the equivalent of $50 and own half a share. Magic.

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ok, thanks, did not know you will not be able to buy uk fractional shares

yes, i knew trade would be executed at the end of the day, but glad to know you will be able sell fractional shares

Although, as I tend to say, our ambitions are large. :wink:

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UK shares are mostly cheap though - it’s the $1,000 AMZN when fractional shares are super useful. But would be good to know if this is likely to be available in the future, @Viktor would you be able to confirm if this is on the roadmap? :pray:

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Whilst not certain, I believe the reasoning behind fractional shares for the US is due to their high prices generally - Amazon is over $1,600, Booking.com is circa $2,000, Berkshire A shares are $300,000 per share.

Whereas the most expensive FTSE100 would be Paddy Power at ÂŁ90. In comparison to the US, pence money. The majority of the UK shares trade between ÂŁ1 and ÂŁ25 hence fractional is not quite necessary

P.S. Posted after @tommy but basically supporting his point :grinning:

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We’ve had discussions about it.

With the new funds, we’re doubling down on hiring and product velocity, so you should hear some updates about this over time.

All in all, a lower priority as UK shares are much cheaper.

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That’s a fair point!

Although when it comes to UX, it’d really nice to be able to simply buy £X worth of shares, rather than having to work out how many whole shares you can afford to buy with your money.

Definitely not the end of the world but it would just remove a little bit of friction & make the experience a little more enjoyable.

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@Freetrade_Team_Design will be happy to read this.

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That’s definitely the plan :smile:. It’s very easy with US shares as you just say how much you want to spend and we’ll go and get as many shares as we can at that amount. With UK shares, I want to bring in the same UX where you can say how much you want to buy, and we’ll round to the closest number of whole shares.

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Here’s how Coinbase do this:

41

Looks super simple :+1:

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This is how IG do it…

Choose an amount to invest, so say ÂŁ500, then it calculates how many shares this will buy, factoring in your ÂŁ8 (:man_facepalming:t3:) dealing fee.

Also when you change the order level for on exchange trades, it dynamically adjusts the quantity of shares according to the level you set. Whilst it’s not compelling and beautiful, it’s fluid and clear on mobile.

I’m guess fractional trades will use the same principle?

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5 posts were split to a new topic: Dividends from fractional shares?

Sorry if this has been asked previously but, if we did purchase fractional shares, how does it work in terms of ownership and dividends? Would the shares be in the individuals name and dividends paid into their freetrade account? Similarly with full shares?

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Yes, if you own 0.5 or company X, you will get their payout * 0.5

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What @vlad said

Plus, your shares are held by Freetrade nominees so the dividends (fractional or otherwise) are paid to us and we pass them to you - in to your Freetrade account. Standard practice, nothing to worry about, we’re on the ball :wink: and will pay them to your account ASAP (usually pay date as long as we ourselves receive the payment). As you’d expect there’s rules and regulations surrounding dividend payments. Even if there wasn’t we’d still strive to get your money to you quickly because a) it’s your money and b) we’re just nice like that

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Thanks rob, so to clarify, the shares aren’t in my name, they would be in Freetrade Nominees?

Yep. Operationally efficient. Legally sound. Standard practice. Nothing fishy.

If you want them in your own name you can either store certificates under your mattress. Sounds a bit old school? You should then try trading them!

You could operate a personal Crest account with people like Charles Stanley, Redmayne or Killik but I’d reckon you’ll pay a decent fee for that and I have no idea what happens in the event of corporate actions. I’m guessing (I really am guessing - I genuinely do no know) that in a corporate action event your “sponsor” broker manages your Crest account for you… for a cost. I personally just don’t have enough incentive to have my name on the share register and am more than happy with a nominee structure. You might not be. Up to you. Have a look at ShareSoc if so inclined.

Anybody mentions Beaufort Securities will have clown emojis sent in their direction. That’s a different story and SURPRISE the auditors have climbed down from their ludicrously high initial costings. Who would have guessed?

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