What is fractional investing?

One of the unique and flexible investing mechanisms in the US stock market is that investors can own parts of stocks along with full shares. Anything less than 1 quantity is considered a fractional purchase. This allows investors to trade any fraction or dollar value in a listed company. You can purchase shares worth $50 or buy 0.05 shares of a company as per your convenience.

For example, if you want to invest $150 in Amazon, but 1 Amazon share is trading at $3,000, fractional investing allows you to buy less than 1 share i.e. (150/3,000) = 0.05 shares of Amazon. This helps you invest small amounts across a diversified portfolio of stocks.

You can also sell fractional shares of US stocks on Groww.