Fractional share trading

Executive summary

Fractional share trading has reshaped the US securities market since major brokers introduced the offering in late 2019 and early 2020. This innovation allows investors to buy less than a full share of stocks or ETFs, enabling participation with as little as $1. Fractional trading has drastically lowered entry barriers, especially for high-priced securities, fueling a wave of new retail investor engagement, portfolio diversification, and widespread adoption of long-term strategies like dollar-cost averaging.

Driven by commission-free trading and mobile platforms the benefits of fractional share trading are particularly pronounced among younger, tech-savvy investors, contributing to lasting demographic change in market participation. This initiative is a specific Broadridge offering available exclusively to clients on the BPS Canada platform.

Benefits

Fractional shares democratize investing by letting individuals allocate precise dollar amounts across multiple securities, and follow direct indexing strategies, regardless of share price, helping firms to attract younger less affluent clients early in their investment careers.

Fractional share trading promotes diversification, personalized portfolio construction, and the ability to fully deploy small investment sums, features now central to digital-first broker offerings.

Fractional trading is increasing in popularity as a standard feature that many broker dealers are implementing to stay competitive.

How our consulting services can help

Accelerate your fractional trading capability with Broadridge’s expertise, ensuring rapid market entry and seamless implementation. Our Consulting Services team is uniquely positioned to assist financial firms navigating this transformative environment.

Working with our Consulting Services group, BPS Canada platform firms can integrate fractional trading seamlessly while aligning with regulatory, operational, and client-experience objectives.

Broadridge will provide a dedicated engagement team to provide you with program planning and budgeting assistance and collaborate with your program manager to centralize the coordination of activities, stakeholders, third parties/ vendor platforms. Additionally, our approach will give you the following benefits:

We will provide

• Front to back workflow analysis, highlighting areas impacted by enabling fractional share trading.
• Guidance on implementation of Broadridge’s suite of solutions.
• Test case creation, execution, and end to end testing support, from order origination through to client reporting.

Broadridge’s Consulting Services team, aligned with our product teams, is positioned to help firms leverage fractional share trading solutions not only to meet evolving investor demands but also to seize growth opportunities while maintaining regulatory and operational excellence.

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