Wells Fargo offers fractional shares through a WellsTrade feature called Stock Fractions. You can invest as little as $10 in hundreds of stocks and ETFs, buying a slice of a share based on the dollar amount you choose. Trades are commission-free, and the feature runs inside the Wells Fargo Mobile app.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
What You Need to Use Stock Fractions
Stock Fractions is only available to WellsTrade account holders. Three account types qualify: a standard taxable brokerage account, a Traditional IRA, or a Roth IRA. You fund the account by transferring money from a linked Wells Fargo checking or savings account.
The feature is smartphone-only. You won’t find it on the WellsTrade desktop site, and tablet versions of the app aren’t included either.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
How Buying a Fractional Share Works
Instead of choosing a number of shares, you pick a dollar amount. If a stock trades at $400 and you invest $50, you end up owning 0.125 shares. The app handles the math at the current market price.
The minimum per trade is $10 and the maximum is $25,000. The eligible universe is a curated list of hundreds of frequently traded stocks and ETFs rather than everything on the market.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
A few restrictions matter before you place the order. Every fractional order runs as a market order; limit orders, stop orders, and other conditional order types aren’t available. Orders can only be entered during regular market hours, 9:30 a.m. to 4:00 p.m. ET on trading days. No pre-market, no after-hours. And there’s no scheduled or recurring purchase option, so each buy has to be placed by hand.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
What You Own After the Trade
Wells Fargo Clearing Services holds your fractional position in custody. You get the economic benefit of that slice, including proportional dividends. Own 0.5 shares of a stock paying a $2 per-share dividend, and you receive $1.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
Voting rights and voluntary corporate actions are treated differently. Your ability to vote on shareholder proposals or participate in tender offers may be limited or unavailable for fractional positions.1Wells Fargo. Buy Pieces of Companies With Stock Fractions
Automatic dividend reinvestment is available on WellsTrade and can be turned on with a single tap in the mobile app.2Wells Fargo. WellsTrade – Do-It-Yourself Investing
What It Costs
Online stock and ETF trades on WellsTrade carry no commission, and Stock Fractions are included. Buying or selling fractional shares online costs $0.2Wells Fargo. WellsTrade – Do-It-Yourself Investing
Placing a trade through an agent over the phone instead of doing it yourself costs $25, whether the trade is for whole or fractional shares.3Wells Fargo Advisors. WellsTrade Prices and Fees
Two other fees can hit later. Moving your account out to another brokerage costs $49.95, and closing an IRA costs a separate $49.95.4Wells Fargo Advisors. WellsTrade Fees
How Fractional Shares Are Taxed
Fractional shares are taxed the same way as whole shares. Dividends are taxable income, either at ordinary rates or the lower qualified dividend rate depending on the holding period and whether the dividend qualifies.
Sell at a profit and the gain is subject to capital gains tax. Positions held longer than a year qualify for long-term rates; anything sold within a year is a short-term gain taxed at ordinary income rates. Wells Fargo tracks cost basis and reports sale proceeds on Form 1099-B.5Internal Revenue Service. About Form 1099-B, Proceeds From Broker and Barter Exchange Transactions
Watch the wash sale rule. If you sell a security at a loss and buy the same or a substantially identical security within 30 days before or after that sale, the IRS disallows the loss for the current year and adds it to the cost basis of the replacement shares. Fractional shares make it easy to buy small amounts often, and automatic dividend reinvestment can trigger a wash sale without you noticing.6eCFR. 26 CFR 1.1091-1 – Losses From Wash Sales of Stock or Securities
If You Ever Move Your Account
Fractional shares generally can’t be transferred in kind between brokerages. If you move your WellsTrade account, whole shares transfer normally, but fractional portions are typically liquidated and the cash follows the account to the new firm. That forced sale can be a taxable event, so it’s worth considering before you initiate a transfer. The outgoing transfer fee is $49.95, separate from anything the receiving brokerage charges.4Wells Fargo Advisors. WellsTrade Fees
Limitations Worth Knowing Before You Start
- Mobile app only; the WellsTrade desktop site can’t place fractional orders.
- Market orders only; no limit, stop, or conditional orders.
- Regular market hours only; no pre-market or after-hours trading.
- A curated list of hundreds of stocks and ETFs, not the entire market.
- No recurring or scheduled buys; each order is placed manually.
- Voting rights and voluntary corporate actions may not extend to fractional positions.