Minimum Order Size - £2 to £1

Hi, I was wondering is there any specific reason to why the minimum order size is at £2? I personally would like it to be around £1 for a few reasons:

  1. Smaller Investment
  2. Dividend Reinvestment
  3. Easier rebalancing

I assume different people will want the minimum order size to be at different levels for their needs, but I think lowering the minimum order sizer from £2 to £1 will be a nice change and it helps the smaller portfolio use their spare money more. Thank you.

I’m sure someone can come in with a more detailed explanation but for a quick answer:
The minimum order used to be £1 before US fractionals were introduced earlier this year. Then the minimum was bumped to £2. I think think the explanation given then was it relates to an actual minimum order needing to be £1 in order to execute, so the minimum order is set to £2 in order to eliminate any risk of volatile FX fluctuations suddenly dropping the order value to under £1 during execution.

e.g. an order sent at the value of £2 might actually be executed at the price of ~£1.98 during volatile FX fluctuations, this avoids the instance where a £1 order would be executed at ~£0.99 - below the minimum order value.

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That actually makes a lot of sense, thank you. :slightly_smiling_face:

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There actually was no minimum pre fractionals, I used to throw pennies into random stocks.

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I wouldn’t have thought the £2 minimum would apply to dividend reinvestment, when that gets introduced

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I assume you mean when auto dividend reinvestment/DRIP is added. If so, then based on @MJE’s explanation, it looks like it might be there as well.

I was thinking this would be a bulk order (or similar) for all clients and so would avoid that issue. This would be more efficient than individual trades

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I just managed to place an order for 62p! When did this change? I like it as I can spend more of my loose change! Well done Freetrade!

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Good spot. This is a welcome change, particularly with autoinvest seemingly around the corner.

I hold a few trusts that are sub-£2 a unit, so it’s nice to be able to put some extra pennies to work too.

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Yeah got a few 1 pound divident stocks comes in handy

Seems like the new limit is £0.10. Nice. :wink:

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I checked after seeing your comment and the message on the app seems to confirm that! Thank you for highlighting this!

I am surprised Freetrade didn’t communicate this as an improvement, at least in the forum. Praise the team for the change though.

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It may be that it was required to fix something else and FT don’t really want users adding additional small transactions on their servers. They already struggle a bit with dividend payments!

It’s out of the bag now though. Sorry FT!

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