A post was merged into an existing topic: Drip (automatically reinvesting dividends)
Wow, this is actually awesome! Forgive my ignorance, I wasn’t aware of it
Hi Yas, love a reg geek question.
The carved up share will be held in the nominee name (i.e. held as client assets), not in our name. We won’t need to re-register existing assets for this purpose.
It doesn’t really make DVP more complex and we don’t anticipate more custody breaks. But it does need strong technology to work smoothly, which is why we have been building our own investment platform with this functionality in mind.
So how many 0’s can we now add to the Freetrade share price?
Fractions will come in useful when Freetrade IPOs at £hundreds per share
11 posts were split to a new topic: Administering fractional shares
Looking forward to auto reinvestment of dividends too - any idea on when this feature may be released?
We don’t have a timescale for this yet, we’ll share the news here: Drip (automatically reinvesting dividends) when we do!
Ok no problem, cheers Alex
What happens when a share costs £50 and you get 3 orders of £25?
I have a question regarding dividend payouts - if I own just a fraction of a share in a company that wants to pay out dividens, how does this work?
Thanks in advance!
Hi Pavla, you would receive your percentage portion of the dividend - so 50% of a share would mean 50% of the dividend paid out per share
Will you be able to buy fractional shares in a ISA?
Yes you will
Will ETF’s be available in fractions ?
Yes they will
This is great news! While my original reason for wanting this functionality was for the crazy US per share prices, it’s an excellent point about being able to reinvest dividends. Combined with Freetrade’s fee structure, this will allow people to create genuinely diverse portfolios with any level of capital. Game changing IMO.
Not sure about other brokers but Halifax offers dividend reinvestment that results in fractional shares via the ShareBuilder option.
A few questions that came to mind…
Will we pay stamp duty on fractions?
Can you buy fractions in an ISA?
Could Fractional US shares could be sold in £, avoiding the 0.45% FX fee on buying and selling we’ve all come to love?