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Schwab Stock Slices will be available starting June 9 in retail Schwab brokerage, custodial, and individual retirement accounts (IRAs). Its users will be able to trade shares any S&P 500 company, including Apple, Amazon, Netflix, in real-time throughout the trading day using market orders.
The U.S. 14th largest banking institution Charles Schwab Corporation (NYSE: SCHW) has introduced a new fractional trading service. Named Schwab Stock Slices, the feature aims to make investing easier and more accessible.
With Schwab Stock Slices, investors can purchase shares of any S&P 500 company for just $5 each. Of course, shares of such giants as Apple or Amazon cost much more, and not anybody can afford them. But Charles Schwab makes it possible. Now, investors can purchase a single stock slice or up to 10 different Stock Slices at once, at the same price, without any commission. Each slice is considered as a separate investment and can be sold individually.
For example, you have $25, but this sum is not enough to buy let us say Netflix Inc (NASDAQ: NFLX) stock. Don’t get upset. Using this money, you can get a fraction of the Netflix share. Moreover, you can split this $25 and buy slices of various shares, the minimum price is $5 per each.
Each slice will appear in your brokerage account. You can either hold it or sell it individually. In addition, you may choose to automatically reinvest cash dividends into additional shares of those stocks.
Schwab Stock Slices will be available starting June 9 in retail Schwab brokerage, custodial, and individual retirement accounts (IRAs). Its users will be able to trade shares in real-time throughout the trading day using market orders.
Speaking about their new offer, Neesha Hathi, head of Schwab Digital Services, explained:
“We developed Schwab Stock Slices to meet two important needs we heard from clients – newer investors who want the ability to buy multiple stocks in small dollar amounts and older more affluent investors who want to more easily gift stock ownership to younger generations. This is our first use of fractional shares, and we’re looking forward to exploring additional ways we can use the functionality to improve how clients invest.”
Charles Schwab Stock Grows
After Charles Schwab (SCHW) unveiled its new fractional trading feature, its stock took off. It rose by 1.74% yesterday and closed at $35.17 per share. Charles Schwab stock is further up in the pre-market today, trading at $35.39 (+0.63%) at the moment of writing.
Charles Schwab shares have suffered as a result of the coronavirus pandemic. While stocks of other companies managed to more or less recover after the crash in March, Schwab stock did not. At the beginning of 2020, it was performing much better. The annual change is now negative at 26.05%. The company’s market cap is $45.277 billion.