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Can You Buy Fractional Shares on E*TRADE?
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Can You Purchase Fractional Shares at E*TRADE?
Major Findings:
• E*TRADE now supports fractional-share trading in eligible stocks and ETFs.
• No additional surcharge applies to fractional-share transactions at E*TRADE.
• Only eligible stocks and ETFs can be purchased in fractional quantities through the E*TRADE platform.
E*TRADE is gradually expanding its fractional-share trading service. Here is how the program works:
Overview of Fractional Shares at E*TRADE
Fractional ownership has existed at E*TRADE for many years. The broker-dealer has always offered whole-dollar investing in mutual funds, a policy that naturally results in fractional shares of those funds. E*TRADE now provides cryptocurrency trading as well, allowing customers to buy and sell supported cryptocurrencies using dollar-based orders.
Customers may also activate automatic dividend reinvestment through E*TRADE’s dividend reinvestment plan (DRIP). The program uses eligible dividend payments to purchase additional shares, which commonly creates fractional positions.
E*TRADE is now introducing direct fractional-quantity purchases for exchange-traded funds (ETFs) and stocks. These orders create fractional positions when the trade executes, rather than requiring investors to wait for reinvested dividends.
Eligible Securities for Fractional-Share Trading at E*TRADE
E*TRADE’s rollout begins with a pilot group based on S&P 100 securities and will expand through additional stages. Once the rollout is complete, fractional trading will cover most listed Reg-NMS stocks and exchange-traded products. OTC securities, BRK.A, and Morgan Stanley common and preferred shares are excluded, and additional securities may also be restricted.
E*TRADE Promotion
Placing a Fractional-Share Trade at E*TRADE
Submitting a fractional-share order for an eligible investment at E*TRADE is generally similar to entering a standard trade. Mutual fund orders continue to work the same way: enter the dollar amount you want to invest on the order ticket.
For stocks and ETFs, open the order ticket on any E*TRADE platform, including the website, browser platform, mobile app, or desktop program, and enter the share quantity you want to trade, using up to three decimal places. Currently, E*TRADE’s software does not accept a whole-dollar amount for these orders, although this capability is planned for the future.
Once the ticker symbol and fractional quantity have been entered correctly, preview and place the order normally. E*TRADE will process the requested quantity using the instructions selected on the trade ticket.
At E*TRADE, only market and limit orders are accepted for fractional-share trades. If the quantity is less than one full share, only a market order can be used.
Dividends and Voting Rights on Fractional Shares at E*TRADE
Fractional positions in an E*TRADE brokerage account earn dividends according to the portion of a share owned. For instance, an investor holding 0.25 shares will generally receive about one-quarter of the dividend distributed for one full share of the stock or ETF.
Fractional positions generally participate in mandatory corporate actions in proportion to the ownership interest and can usually be voted proportionally in proxy matters. However, fractional shares may be ineligible for voluntary corporate actions, including tender offers and certain rights offerings.
Fees and Minimums at E*TRADE for Fractional-Share Investing
E*TRADE uses its standard pricing schedule for fractional-share transactions. As a result, eligible online trades of U.S.-listed stocks and ETFs have $0 commissions. Cryptocurrency transactions carry a 0.50% commission based on the notional value of the trade.
Some mutual funds have a listed minimum investment of $0. Fractional stock and ETF orders may be entered in increments as small as 0.001 shares, but purchases must satisfy a $5.00 minimum notional value.
Updated on 9/21/2026.
Chad Morris has been analyzing investment firms for Brokerage-Review.com since 2015. Backed by FINRA Series 65, 66, and SIE credentials, his work reflects a deep knowledge of the retail brokerage industry and digital trading tools.
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