The Rise of Fractional Trading in Singapore: Empowering Retail Investors
Video Transcript
Fractional trading is transforming the way retail investors participate in the stock market.
By allowing individuals to buy less than a whole share, this innovation is making investing more accessible and flexible than ever before, especially for those with limited capital.
Instead of purchasing shares in large lots, investors can now own a fraction of a share for a fraction of the price.
This means that even high-priced stocks are within reach, democratizing access to markets that were once reserved for those with significant funds.
In Singapore, fractional trading is gaining traction.
Platforms like Interactive Brokers, Syfe Trade, Tiger Brokers, and Webull offer fractional shares trading, primarily for United States stocks.
However, not all stocks or exchange-traded funds are eligible, so investors should always check availability before investing.
Fractional shares let investors gain exposure to their favorite companies without needing to buy a full share.
This flexibility allows for regular investing, such as allocating a fixed amount monthly, and helps build a diversified mini-portfolio tailored to individual goals.
Beyond trading, post-trade processing is crucial.
Contemi Nova, used by over half of Singapore’s brokers, streamlines operations with modular, multi-market support and automation.
This reduces costs and boosts efficiency, supporting the evolving investment landscape for everyone.
To learn more, visit nova.contemi.com ?or contact us at info at contemi.com to ?book a demo.
In recent years, fractional trading has revolutionized the investment landscape, making it more accessible and flexible for retail investors. This trend has gained significant momentum globally, including in Singapore.
Let’s explore the rise of fractional trading and its impact on investors in the Lion City.
What Is Fractional Trading?
Fractional trading allows investors to own less than one whole share of a company. Instead of being restricted to buying shares in lots of 1,000 or 100, investors can now invest in a fraction of a share – for a fraction of the cost. This democratizes investing, as no stock is too expensive to consider.
Fractional Trading in Singapore
While fractional trading is more prevalent for U.S. stocks, several brokerages in Singapore offer this feature. Notable platforms include:
- Interactive Brokers: Offers fractional shares trading for both U.S. and European markets.
- Syfe Trade: Provides fractional shares trading for U.S. stocks.
- Tiger Brokers: Allows fractional trading for U.S. stocks.
- Webull: Also offers fractional shares trading for U.S. stocks.
Investors should note that not all shares are eligible for fractional investing, so it’s essential to check availability for specific stocks or ETFs.
Benefits of Fractional Shares
Gain Only the Exposure You Want
The primary advantage of fractional shares is that investors can gain exposure to specific companies without having to buy an entire share. For instance, if you want to invest in Microsoft shares regularly, you can allocate a fixed amount (e.g., US$100) each month. Fractional trading allows instant access to a fraction of Microsoft shares, bypassing the need to wait until you can afford a full share.
Build Your Own Mini-Portfolio
Fractional shares are not entirely new. Investors who have bought into ETFs or unit trusts have already experienced fractional ownership. These investment vehicles provide exposure to hundreds of stocks with relatively small amounts of capital. With fractional trading, you can create your mini-portfolio by investing in various companies, diversifying your holdings effectively.
Contemi Nova: Streamlining Post-Trade Processing
Beyond fractional trading, let’s explore Contemi Nova, a post-trade processing software system used by over 50% of brokers in Singapore.
Here’s how it benefits investment banks and stockbrokers:
- Modular and Configurable: Nova is highly customizable, supporting multi-market, multi-currency, multi-entity, and multi-asset class operations.
- Cost Reduction: By automating post-trade processes, Nova reduces resource and system costs.
- Efficiency: Nova streamlines end-to-end processes, enhancing operational efficiency.
Fractional trading empowers retail investors, allowing them to invest in their favorite companies without financial constraints. As Singapore’s investment landscape evolves, platforms like Contemi Nova play a crucial role in optimizing post-trade operations. Whether you’re a seasoned investor or just starting, fractional trading and robust post-trade solutions are shaping the future of investing in Singapore.
Gaurav Mehta
Chief Commercial Officer
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