Fidelity lets clients now trade fractional shares of stocks and ETFs

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mighty72
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by mighty72 » Tue Feb 11, 2020 10:15 pm

mighty72 wrote:
Tue Feb 11, 2020 12:17 am
It got enabled for me too but says that fractional orders can be placed only during market hours. I will try tomorrow
I was able to execute the trade. $100 worth of ITOT. It was a limit order. Now, if I could figure out how to do this every month automatically.

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TheTimeLord
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by TheTimeLord » Wed Feb 12, 2020 2:11 pm

I can see using this to do a stock version of Draft Kings in my portfolio. Yep, this will lead to nothing good on my end, but probably quite fun.
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MotoTrojan
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by MotoTrojan » Wed Feb 12, 2020 2:28 pm

TheTimeLord wrote:
Wed Feb 12, 2020 2:11 pm
I can see using this to do a stock version of Draft Kings in my portfolio. Yep, this will lead to nothing good on my end, but probably quite fun.
M1 Finance has allowed a super seamless way of doing just this for quite some time.

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by ElJefeDelQueso » Wed Feb 12, 2020 2:31 pm

mighty72 wrote:
Tue Feb 11, 2020 10:15 pm
mighty72 wrote:
Tue Feb 11, 2020 12:17 am
It got enabled for me too but says that fractional orders can be placed only during market hours. I will try tomorrow
I was able to execute the trade. $100 worth of ITOT. It was a limit order. Now, if I could figure out how to do this every month automatically.
Just showed up in my app in the past hour.
Agree auto/scheduled trades would be a major step forward. I use ETFs and am not a fan of manual trades during market hours.

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TheTimeLord
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by TheTimeLord » Wed Feb 12, 2020 2:32 pm

MotoTrojan wrote:
Wed Feb 12, 2020 2:28 pm
TheTimeLord wrote:
Wed Feb 12, 2020 2:11 pm
I can see using this to do a stock version of Draft Kings in my portfolio. Yep, this will lead to nothing good on my end, but probably quite fun.
M1 Finance has allowed a super seamless way of doing just this for quite some time.
I think there have been lots of way I could have gotten into this kind of trouble/fun in recent years, but never with anyone I was using before.
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by dollar_elbow » Wed Feb 12, 2020 3:01 pm

It was enabled on my account today and it works for buying Vanguard etfs. It seems there is little reason to bother with mutual funds anymore.

I should note that you have to view the yellow info panel that appears just before you place your first fractional purchase (usually you can ignore them as it’s just prospectus info), otherwise the trade won’t go through.

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1789
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by 1789 » Wed Feb 12, 2020 3:37 pm

Worked today. Bought some VTI.
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ChrisBenn
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by ChrisBenn » Thu Feb 13, 2020 5:37 pm

I put in a market order denominated in us dollars which mapped out to 235.251 shares of an etf with a ~$0.06 bid/ask spread. One lot at 100 filled at $.003 over the midpoint and another lot of 135 filled at $0.002 over the midpoint. The .251 fractional shares filled exactly at the ask.

The midpoint fills are consistent with what I got with previous share denominated market orders.

I'm totally fine with this, since the fractional share price higher cost only impacted the fractional portion -- just found it interesting.

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by bck63 » Thu Feb 13, 2020 6:19 pm

Still waiting.

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by jhfenton » Thu Feb 13, 2020 9:18 pm

ChrisBenn wrote:
Thu Feb 13, 2020 5:37 pm
I put in a market order denominated in us dollars which mapped out to 235.251 shares of an etf with a ~$0.06 bid/ask spread. One lot at 100 filled at $.003 over the midpoint and another lot of 135 filled at $0.002 over the midpoint. The .251 fractional shares filled exactly at the ask.

The midpoint fills are consistent with what I got with previous share denominated market orders.

I'm totally fine with this, since the fractional share price higher cost only impacted the fractional portion -- just found it interesting.
Thanks for the detail. I've been curious about execution, but not many folks have shared the details yet. :beer

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by bogledogle87 » Thu Feb 13, 2020 9:50 pm

Placed my first fractional order for VT in my HSA yesterday with no problem. I’m pretty excited about this. With the ability to trade fractional shares, there is also no reason not to automatically reinvest dividends at Fidelity, either. Previously it was quite difficult to sell fractional shares.

Now, You can essentially turn any stock or etf into a mutual fund under these circumstances, which is a game changer. All they need now is to enable automatic investment of dollar amounts into ETF’s which I hope may be a future enhancement. I’m very curious If the other brokers will follow suit.
VTWAX and chill

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1789
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by 1789 » Fri Feb 14, 2020 12:17 am

Only thing left is automated ETF investing. Are we going to see that soon?
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by jhfenton » Fri Feb 14, 2020 9:11 am

1789 wrote:
Fri Feb 14, 2020 12:17 am
Only thing left is automated ETF investing. Are we going to see that soon?
I think I asked earlier in the thread, but how would folks expect this to work? Would they limit it to Market or Limit on Open (MOO or LOO) or Market or Limit on Close (MOC or LOC) orders? Would they give you a choice between the two? Or would you be able to specify a time for your order? Would they limit automatic investment to the most liquid ETFs where there would never be a risk of a failed opening or closing auction or where they could pool purchases (as with dividend reinvestments)?

There are enough complications to consider with automatic ETF investments to make me believe it will be a while. I certainly wouldn't expect to see it from a major brokerage this year.

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1789
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by 1789 » Fri Feb 14, 2020 9:20 am

I really don’t know how it will work. I look at it from a business perspective and so believe that someone over their is thinking the details on how to make it work.
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by UpperNwGuy » Fri Feb 14, 2020 9:29 am

bogledogle87 wrote:
Thu Feb 13, 2020 9:50 pm
I’m very curious If the other brokers will follow suit.
If Vanguard is really serious about wanting its customers to transition from mutual fund accounts to brokerage accounts, they should implement this fractional ETF share strategy quickly.

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by bogledogle87 » Fri Feb 14, 2020 9:47 am

UpperNwGuy wrote:
Fri Feb 14, 2020 9:29 am
bogledogle87 wrote:
Thu Feb 13, 2020 9:50 pm
I’m very curious If the other brokers will follow suit.
If Vanguard is really serious about wanting its customers to transition from mutual fund accounts to brokerage accounts, they should implement this fractional ETF share strategy quickly.
I would love to see this. I might actually consider switching to fidelity down the line if they do not. What is interesting is that fractional share ETF trading at vanguard could almost negate the need for their mutual funds entirely for a retail investor, especially if they allowed automatic dollar purchasing. Why would you need a mutual fund anymore? If implemented, I could see the MF customer base shifting exclusively toward institutional and retirement plans
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by jhfenton » Fri Feb 14, 2020 10:27 am

bogledogle87 wrote:
Fri Feb 14, 2020 9:47 am
I would love to see this. I might actually consider switching to fidelity down the line if they do not. What is interesting is that fractional share ETF trading at vanguard could almost negate the need for their mutual funds entirely for a retail investor, especially if they allowed automatic dollar purchasing. Why would you need a mutual fund anymore? If implemented, I could see the MF customer base shifting exclusively toward institutional and retirement plans
It's definitely a major plus for Fidelity. I was talking to our 17-year-old last night, and we're going to open a Roth IRA for him now that he has a job (hardware store). He started after Thanksgiving and only made $300+ dollars in 2019, so his 2019 contribution will be small. (He plans to contribute half of his earnings. :beer ) The ability to buy fractional shares will be a major plus, whatever he decides to buy.

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by JamesSFO » Fri Feb 14, 2020 12:01 pm

It's now available to me in mobile only when I did "quick trade".

ftobin
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by ftobin » Fri Feb 14, 2020 1:00 pm

jhfenton wrote:
Fri Feb 14, 2020 9:11 am
I think I asked earlier in the thread, but how would folks expect this to work? Would they limit it to Market or Limit on Open (MOO or LOO) or Market or Limit on Close (MOC or LOC) orders? Would they give you a choice between the two? Or would you be able to specify a time for your order? Would they limit automatic investment to the most liquid ETFs where there would never be a risk of a failed opening or closing auction or where they could pool purchases (as with dividend reinvestments)?

There are enough complications to consider with automatic ETF investments to make me believe it will be a while. I certainly wouldn't expect to see it from a major brokerage this year.
I can pretty much guarantee they'd be MOC or VWAP orders, for a slew of reasons, including that it would be easier for Fidelity to hedge. My former employer 401k had dollar-denominated transactions for company stock, probably done has MOC (never really bothered to find out).

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by Texanbybirth » Fri Feb 14, 2020 3:31 pm

Very satisfying to put all cash to work today in our Roth IRA @ Fidelity. I bought fractional shares for this month's contribution with no problem. A welcome improvement! :beer
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by ChrisBenn » Fri Feb 14, 2020 5:14 pm

ftobin wrote:
Fri Feb 14, 2020 1:00 pm
jhfenton wrote:
Fri Feb 14, 2020 9:11 am
I think I asked earlier in the thread, but how would folks expect this to work? Would they limit it to Market or Limit on Open (MOO or LOO) or Market or Limit on Close (MOC or LOC) orders? Would they give you a choice between the two? Or would you be able to specify a time for your order? Would they limit automatic investment to the most liquid ETFs where there would never be a risk of a failed opening or closing auction or where they could pool purchases (as with dividend reinvestments)?

There are enough complications to consider with automatic ETF investments to make me believe it will be a while. I certainly wouldn't expect to see it from a major brokerage this year.
I can pretty much guarantee they'd be MOC or VWAP orders, for a slew of reasons, including that it would be easier for Fidelity to hedge. My former employer 401k had dollar-denominated transactions for company stock, probably done has MOC (never really bothered to find out).
I find M1's implementation pretty reasonable - a trade at a target time window - after open. I think it was 10:30 central?.

ftobin
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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by ftobin » Fri Feb 14, 2020 11:15 pm

ChrisBenn wrote:
Fri Feb 14, 2020 5:14 pm
I find M1's implementation pretty reasonable - a trade at a target time window - after open. I think it was 10:30 central?.
That's great if brokers can keep cost down and provide that functionality. Generally there is much more liquidity near at EOD, so there's more liquidity to hedge with during that time (fractional shares necessitate that the broker act as the counterparty, and they'll hedge it away).

Mario2222
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Any thoughts about fidelity ETForders in dollars with fractional shares

Post by Mario2222 » Fri Feb 21, 2020 10:07 am

[merged into existing thread - moderator prudent]

https://thefinancebuff.com/etf-orders-d ... hares.html

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Re: Fidelity lets clients now trade fractional shares of stocks and ETFs

Post by Mario2222 » Sat Feb 22, 2020 11:20 am

I like M1 finance for the auto rebalancing.

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