Shares can be expensive. Especially if you're trying to buy shares that are worth hundreds of dollars. A single Alphabet share is over $1200! But the good news is, thanks to fractional shares, you can now purchase any amount of a share and start investing with a lot less capital.
In this post I'm going to share some very different options on how to buy fractional shares and get exposure to the stock market with very little money.
If you want to get started investing with very little money, then your best bet is with Acorns. Your money will be invested in fractional shares of ETFs. Exchange Traded Funds give you access to hundred and sometimes thousands of stocks that are wrapped up into one nice, neat, exchange traded fund. On Acorns you don't get to pick the stocks you invest in. Instead, you choose one of 6 portfolios that have been put together by experts. To be honest, this is a much better strategy than picking stocks on your own.
With Acorns you're still investing in the stock market. But instead of just own a few shares, you own a fraction of thousands of shares. Your money is spread across a diverse portfolio. And just because it's diverse, doesn't mean it's not profitable. I've made a 28% return over the past 2 years from using Acorns. Any fund manager would be jealous of those results (and probably getting a little nervous as their entire job has been replaced by an app).
You can start investing on Acorns with as little as $5. And the app will even work automatically by transferring small amounts of spare change into your investment account so you're always saving. Overall Acorns is a great option for anyone looking to start investing.
You can sign up for a free Acorns account here
eToro lets you trade stocks from all over the world. And the best bit is, you don't need to buy a full share when trading. You choose any dollar amount to trade with. This means you could buy $50 worth of Apple shares or $100 worth of Amazon shares. The choice is yours.
eToro also has a handy copy trading feature. So if you don't know which stocks to buy, you can use the knowledge of other traders. When you copy trade, you automatically copy the trades made by a more experienced trader. When their account makes a trade, your account will make that trade too. You can browse through the traders on eToro and find the ones you use low risk trading strategies and still make good returns.
In terms of shares, you can buy shares from all over the world. This means you can trade stocks from the U.S, Europe and Asia all in the one trading platform.
It costs a little bit more to start trading on eToro. To get started you'll need $200. But eToro doesn't charge any commissions on trades. You simply pay the spread (which is the small difference between the sell and buy prices).
You can find out more about trading fractional shares on eToro here
Disclaimer: eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results.
Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.