Fidelity investors will now have the opportunity to make trades on fractional shares for stocks and ETFs, the brokerage firm announced. The news comes months after competitors made their own changes to how their clients can trade such shares. However, it remains to be seen when, or if, the service will be available to Fidelity advisors.
According to Scott Ignall, the head of Fidelity’s retail brokerage business, the move offers clients easier and more accessible investing opportunities.
“Leveraging Fidelity’s award-winning mobile apps and brokerage platform, customers can now own a piece of their favorite companies and ETFs based on how much they want to invest, independent of the share price,” he said.
A spokesperson for Fidelity said that there was no exact timeline on when advisors would be able to trade fractional shares.
"We are currently gauging demand for this capability from advisors and working with them to address how we can meet their specific trading needs,” the spokesperson said.
According to Fidelity, all fractional trades will happen during market hours, which will let investors always know the price of the share, and they'll be available for all eligible Fidelity retail accounts. Last fall, Fidelity Institutional President Mike Durbin told a WealthManagement.com roundtable that fractional shares were in the firm’s future and would start with its retail clients.
In October of last year, Charles Schwab announced it would introduce fractional share trading to its clients, though the firm has not yet done so. The announcement came a few weeks after Schwab announced it was ending commissions on all trades, accelerating a race to zero fees by competitors, including e*Trade and TD Ameritrade.
Other firms have introduced fractional share trading to customers. In late November, Interactive Brokers Group announced that its clients would be able to trade fractional shares, which the firm said would offer more “access and flexibility” to investors. In December, Robinhood announced that it would also offer fractional share trading for investors, saying doing so was part of its “mission to democratize services.”
Fidelity’s rollout of fractional trading began today and will continue throughout the next few weeks, according to the firm.