As the world of investing continues to evolve, more and more people are looking for ways to get involved in the stock market without breaking the bank. One way to do this is through fractional shares, which allow investors to purchase a portion of a stock rather than a full share. But does Ally Invest, a popular online brokerage firm, offer fractional shares? In this article, we’ll take a closer look at Ally Invest and its offerings to find out.
What are Fractional Shares?
Before we dive into whether or not Ally Invest offers fractional shares, let’s take a step back and define what fractional shares are. Fractional shares are a type of stock that represents a portion of a whole share. They’re often used by investors who want to diversify their portfolios but don’t have enough money to purchase a full share of a particular stock.
For example, let’s say you want to invest in Amazon (AMZN) but don’t have enough money to purchase a full share, which is currently trading at over $3,000. With fractional shares, you could purchase a portion of a share, such as 0.1 or 0.5 shares, for a lower cost.
The Benefits of Fractional Shares
Fractional shares offer several benefits to investors, including:
- Diversification: With fractional shares, investors can diversify their portfolios by purchasing small portions of different stocks, rather than having to purchase a full share of each.
- Affordability: Fractional shares make it possible for investors to purchase stocks that they may not have been able to afford otherwise.
- Flexibility: Fractional shares give investors the flexibility to invest as much or as little as they want, without having to purchase a full share.
Does Ally Invest Offer Fractional Shares?
Now that we’ve defined what fractional shares are and their benefits, let’s take a look at whether or not Ally Invest offers them. The answer is yes, Ally Invest does offer fractional shares.
In 2020, Ally Invest announced that it would begin offering fractional shares to its customers. This move was seen as a way to make investing more accessible to a wider range of people, particularly those who are new to investing or who don’t have a lot of money to invest.
With Ally Invest, customers can purchase fractional shares of stocks, ETFs, and mutual funds. The minimum investment requirement for fractional shares is just $1, making it possible for investors to get started with a small amount of money.
How to Purchase Fractional Shares with Ally Invest
Purchasing fractional shares with Ally Invest is a relatively straightforward process. Here’s how to do it:
- Log in to your Ally Invest account and navigate to the trading platform.
- Search for the stock, ETF, or mutual fund you want to purchase.
- Select the “Buy” option and choose the number of fractional shares you want to purchase.
- Enter the dollar amount you want to invest and confirm your purchase.
Other Brokerages that Offer Fractional Shares
Ally Invest is not the only brokerage firm that offers fractional shares. Several other popular brokerages also offer this feature, including:
- Fidelity: Fidelity offers fractional shares of stocks, ETFs, and mutual funds, with a minimum investment requirement of $1.
- Charles Schwab: Charles Schwab offers fractional shares of stocks, ETFs, and mutual funds, with a minimum investment requirement of $5.
- Robinhood: Robinhood offers fractional shares of stocks, ETFs, and options, with a minimum investment requirement of $1.
Comparison of Fractional Share Offerings
Here’s a comparison of the fractional share offerings of Ally Invest, Fidelity, Charles Schwab, and Robinhood:
| Brokerage | Minimum Investment Requirement | Available Investments |
|---|---|---|
| Ally Invest | $1 | Stocks, ETFs, mutual funds |
| Fidelity | $1 | Stocks, ETFs, mutual funds |
| Charles Schwab | $5 | Stocks, ETFs, mutual funds |
| Robinhood | $1 | Stocks, ETFs, options |
Conclusion
In conclusion, Ally Invest does offer fractional shares, making it possible for investors to purchase a portion of a stock, ETF, or mutual fund for a lower cost. This feature is particularly useful for investors who are new to investing or who don’t have a lot of money to invest.
While Ally Invest is not the only brokerage firm that offers fractional shares, its minimum investment requirement of $1 and wide range of available investments make it a popular choice among investors.
Whether you’re a seasoned investor or just starting out, fractional shares can be a great way to diversify your portfolio and get started with investing.
What are fractional shares and how do they work?
Fractional shares are a type of investment that allows individuals to purchase a portion of a stock rather than a whole share. This is particularly useful for investors who want to diversify their portfolios but may not have enough capital to purchase whole shares of higher-priced stocks. Fractional shares can be purchased through various brokerages, including Ally Invest.
When you buy a fractional share, you’re essentially buying a percentage of the stock. For example, if you want to invest $100 in a stock that costs $500 per share, you can purchase 0.2 shares of the stock. This allows you to own a portion of the stock without having to pay the full price of a whole share. Fractional shares can be traded just like whole shares, and you can sell them at any time.
Does Ally Invest offer fractional shares?
Yes, Ally Invest does offer fractional shares. Ally Invest is a popular online brokerage firm that allows investors to buy and sell stocks, options, ETFs, and other securities. In recent years, Ally Invest has expanded its offerings to include fractional shares, making it easier for investors to diversify their portfolios and invest in higher-priced stocks.
To purchase fractional shares through Ally Invest, you can simply log in to your account and search for the stock you want to buy. You can then select the “fractional shares” option and specify the amount you want to invest. Ally Invest will automatically calculate the number of fractional shares you can purchase based on the amount you invest.
What are the benefits of buying fractional shares through Ally Invest?
One of the main benefits of buying fractional shares through Ally Invest is that it allows you to diversify your portfolio without having to pay the full price of a whole share. This can be particularly useful for investors who are just starting out or who have limited capital. Fractional shares also allow you to invest in higher-priced stocks that may have been out of your reach before.
Another benefit of buying fractional shares through Ally Invest is that it allows you to invest as little or as much as you want. You can invest $10, $100, or $1,000 – whatever amount you’re comfortable with. This makes it easier to get started with investing and to build a portfolio over time.
Are there any fees associated with buying fractional shares through Ally Invest?
Ally Invest does not charge any fees for buying or selling fractional shares. However, there may be some other fees associated with your account, such as management fees or trading fees. It’s always a good idea to review the fee schedule before opening an account or making any trades.
It’s worth noting that Ally Invest does offer commission-free trading for stocks, options, and ETFs, which means you won’t have to pay any trading fees when you buy or sell fractional shares. This can help you save money and maximize your returns over time.
Can I sell my fractional shares through Ally Invest?
Yes, you can sell your fractional shares through Ally Invest. Selling fractional shares is just like selling whole shares – you can log in to your account, select the stock you want to sell, and specify the number of shares you want to sell. Ally Invest will automatically calculate the sale price based on the current market price of the stock.
When you sell your fractional shares, you’ll receive the proceeds in your account, which you can then use to invest in other stocks or withdraw as cash. Keep in mind that selling fractional shares may result in capital gains or losses, which may be subject to taxes.
How do I get started with buying fractional shares through Ally Invest?
To get started with buying fractional shares through Ally Invest, you’ll need to open an account with the brokerage firm. You can do this by visiting the Ally Invest website and following the prompts to create an account. You’ll need to provide some personal and financial information, as well as fund your account with money to invest.
Once your account is open and funded, you can start buying fractional shares. Simply log in to your account, search for the stock you want to buy, and select the “fractional shares” option. You can then specify the amount you want to invest and complete the trade. Ally Invest offers a user-friendly platform that makes it easy to buy and sell fractional shares.
Is Ally Invest a reputable brokerage firm?
Yes, Ally Invest is a reputable brokerage firm. Ally Invest is a subsidiary of Ally Financial, a well-established financial services company. Ally Invest is registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).
Ally Invest has a strong reputation for providing reliable and secure trading services, as well as excellent customer support. The firm offers a range of investment products and tools, including fractional shares, options, ETFs, and more. Ally Invest is also known for its competitive pricing and commission-free trading, making it a popular choice among investors.