Understanding fractional orders

In this article:

Overview

Fractional orders are one of four different order types available using Wealthsimple's self-directed stock trading accounts. Other order types include —

How do fractional orders work?

Fractional orders allow you to buy and sell shares in fractions or decimals. This means that you can trade less than one whole share of a security.

To place a fractional order, input a decimal point for the number of fractional shares you wish to trade when prompted during the order flow.

Note: You can only place fractional orders under market orders. Currently, we don't support fractional trading for other order types.

What to expect

  • You cannot place a fractional buy and sell on the same security at the same time.
  • We submit fractional orders several times a day, we do this to consolidate all the buy and sell orders we receive into full shares for execution.
  • Orders can be cancelled at any time as long as they haven't been executed yet. To confirm this, go to the Activity page. If your order is in the Pending status, you can tap the order and select Cancel order.
  • Fractional orders are not available for purchasing cryptocurrencies. Although you can purchase a portion of a coin or token, this is not considered a fractional order. Instead, your order will either be a market order or a limit order.

Understanding fractional buys

When you place a fractional buy order with Wealthsimple, we will ask you to enter the amount of money that you want to spend on a security. You will then get an estimate of how many fractional shares you will receive for that amount. This estimate of a fractional number of shares will change throughout the day, and will depend on the price of the security when your order fills.

Example

Let’s say you wish to buy $200 worth of stock XYZ that is available for fractional orders.

  • When you place your fractional buy order at 11:00 am, stock XYZ is trading at $1,000 per share
  • You’d receive an estimate at the time your order is placed that you will receive 0.2 shares of stock XYZ for $1,000 at 11:00 am
  • The price of stock XYZ continues to fluctuate, and towards the end of the day stock XYZ has increased to $1,100 per share
  • This means that when your order fills, your $200 will now buy you 0.18 shares of stock XYZ

Understanding fractional sells

When you place a fractional sell with Wealthsimple, we will ask you to enter the number of fractional shares you wish to sell of a security. You will then get an estimate of how much money you will receive for selling that many shares. This amount will change throughout the day, and will depend on the price of the security when your order fills.

Example

Let’s say you wish to sell 0.5 of a share of stock XYZ through a fractional order.

  • When you place your fractional sell order at 11:00am, stock XYZ is trading at $1,000 per share
  • You’d receive an estimate at the time your order is placed that you will receive $500 for selling 0.5 fractions of stock XYZ at 11:00 am
  • The price of stock XYZ continues to fluctuate, and towards the end of the day, stock XYZ has increased to $1,100 per share
  • This means that when your order fills, you will receive $550 for 0.5 fractions of stock XYZ

Identifying stocks and ETFs that are available for fractional trading

You can find stocks and ETFs that are available for fractional trading on the Wealthsimple mobile app. Follow these steps:

  1. Log in to the Wealthsimple mobile app
  2. Tap the Discover (search) tab
  3. Tap the Search bar and type Fractional Trading
  4. Choose Fractional Trading from the results
  5. Browse stocks and ETFs that have fractional trading available
Tip: Are there any other securities you wish were available for fractional orders? Let us know by filling out this form.

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