Fractional shares investing lets you buy pieces of stock instead of a full share of stock. The main benefit of fractional shares is the ability to own stock of companies like Amazon and Google that may be too expensive.
The great news is that many more online brokerages are helping new investors the opportunity to buy fractional shares of stocks and ETFs. Some apps even let you buy them for as little as $1 without any trading fees either.
Welcome to the phroogal 5, a series of the five best apps. We’ve done the work to narrow down the best choices. Want more options? Check the marketplace.
Now, that’s a great way to get started investing.
Why Fractional Shares?
To make investing available to more people, many online brokers have begun selling fractional shares online. The brokers allow you to invest in stock fractions as opposed to buying an entire share. Fractional share investing is best for people who want to grow money but don’t have much to start. You don’t need thousands of dollars and can start with as little as $1 with some online brokers.
With fractional shares, you can buy and sell them similar to a full share of stock, but the goal is to help you build up, not stock trading.
Best Fractional Share Investing Apps
The following are the best free apps to own fractional shares of your favorite companies. Choose one or try all of them to find the best platform for you. An take advantage of the signup bonuses too.
Public: Best Social Interaction
Public makes the stock market social. Follow other investors, discover companies to believe in, and invest with any amount of money. Swap insights, gain knowledge, and learn about investing with friends and other interesting people. You can see my Public portfolio here.
- Invest in fractional shares called slices with as little as $5
- Access original ETFs from Vanguard, BlackRock, and others
- No day-trading allowed
Account Fees: $0
Investment minimum: $0
Trading Fees: $0
New Account Bonus: Get $10 worth of shares by opening an account.
Read the Public review.
Webull: Best for Active Traders
Webull offers zero-commission trades on a robust platform. It’s best for the intermediate and expert level investor. The app offers a comprehensive research tool compared with other trading platforms.
- Advanced research tools and services.
- Free real-time quotes.
- Community forum to chat about stocks.
Account Fees: $0
Investment minimum: $0
Trading Fees: $0
New Account Bonus: Get 2 free stocks at an account open and $100 deposit.
Read the Webull review.
Robinhood: Best Original Free Trading App
Robinhood is an online brokerage offering zero commission trading. It offers a streamlined investing app that is good for beginners and seasoned investors who desire simplicity and ease of use. Make trades of stocks, exchange-traded funds (ETFs), and cryptocurrency.
- Buy and sell shares with no commission fees
- Easy to join and intuitive platform
- Access stock performance history
Account Fees: $0
Investment minimum: $0
Trading Fees: $0
New Account Bonus: Get a free stock for opening an account and completing the signup process.
Read the Robinhood review.
M1 Finance: Best for DIY Investors
M1 Finance is an investing platform that combines trading with Robo-advisors. It’s good for beginners and seasoned investors alike. With M1, you get automated and free investing without trading fees and commissions. Choose to invest in what you want or choose portfolios (M1 Pies) created by their experts.
- Choose investing pies and copy portfolios of others
- Offers automatic features such as rebalancing and dividend reinvestments
- Robust and interactive investor education feature
Account Fees: $0
Investment minimum: $0
Trading Fees: $0
New Account Bonus: Get $30 after completing the signup process and funded $1000 within 14 days.
Read the M1 Finance review.
SoFi Active Investing: Best for Simplicity
SoFi Active Investing is an online brokerage that allows you to make zero-commission trades. You can buy fractional shares of stocks and index funds called Stock Bits for as little as $1.
- Simple and easy to use interface
- Set one-time transfers and recurring automated investments
- Get extra benefits with SoFi Membership.
Account Fees: $0
Investment minimum: $1
Trading Fees: $0
New Account Bonus: Get $25 in stocks to start your portfolio when you fund your SoFi Invest account with at least $1,000.
Read SoFi Active Investing review.
Bottom Line: Should You Buy Fractional Shares?
What I love about fractional shares is that it democratizes access to the stock market. With as little as $1 you can own shares of your favorite company. It helps shift the mindset from a consumer to an investor. The long-term benefit is an increased desire to continue to invest more of your income so that your money begins to grow.
Fractional share investing is like saving money. Think of the full share price as the financial goal and you’re investing to reach that goal. The benefit is owning shares, even if it’s just a fraction, that can grow in value far better than a standard savings account. Buying fractional shares is great for anyone who wants to invest with their first $100 or others who simply want to start slowly.
