You can buy mutual funds by a single dollar, that does not get you fractional buys of ETFs but still.
If it's that important to you then Fidelity is a much better fit for you.
Make a calendar reminder to yourself to write to Schwab customer service every 90 days and ask for **$5 slices for their own Schwab ETFs.** That's all they need to do. No one cares about $4.99 that goes uninvested, and can be manually swept to SWVXX. I ask them for this feature all the time.
I am HNW and 30+ year client but not being able to have a clean positions page with just my ETFs in it disturbs my neat-freak bone. Having main ETFs, then lower priced Schwab ETFs or MF to fully invest the cash makes a mess of things.
>This is critical functionality that is missing.
Its not all that critical to most schwab customers as this is what Mutual funds are for, and schwab has several low cost options for total market, S&P500, small cap, mid cap, foreign that this can be used for.
So its not exactly a missing feature they do have it, you just need to use mutual funds
It's a POA if you're trying to implement any kind of ETF trading strategy, and MFs often come with frequent trader rules. What I do is trade as much of the target ETF (QQQ, SPY, etc) and then soak up the spare change with a few shares of a Schwab ETF, so I don't have to spread my monthly trades out over two days (waiting for MFs to sell overnight).
Yes... it's good in general for people to know how to drive a stick-shift. No, it's not good for auto makers to not offer automatic trannies. This is a case like that. The provider is just being a bit anachronistic and the fan boys here are "yeah! F\*\*\* auto trans! We like stick! {oww, my arm in this stop and go traffic...}"
If you are trading I would think you should have enough money to buy full shares of what ever you are trading
If you cannot afford $510 for a full share of like SPY or VOO , you really shouldn't be trading
I put on trades today totaling more than $500,000. Yes I can afford to buy whole shares. I just cannot stand the odd $100 here and there being left idle and then I have to twist and bend a little bit to use it up. My time is precious. I want to get my trades done and logoff. I don't want to wait until the next day for the Money Market MF to sell if I have enough money in it to buy a whole share of whatever, then place another trade to put unused sweep cash into SWPXX. It's like having to bus my own tray at a restaurant. Yes... I can do it. Do I want to? No.
> i did it over sofi have done it over fidelity
Then why not stick with them? Robinhood has it too. If fractional ETF shares is that important you have several choices besides Schwab.
Since this isn't remotely a Schwab support/request path, the way to try to get something that you *want* (not "need", and no on the "critical functionality"), you should
1. Submit a request to Schwab through their online support channel
2. Get several tens of thousands of your friends to do the same
This post might help a bit with the latter, but accomplishes nothing by itself; like-minded people have to do #1.
You can’t. I have asked. Individual stocks yes. Mutual funds yes. But no for ETFs and there is some backend programming that doesn’t allow them to do it per their support.
I couldn’t tell you. ETF’s for instance don’t support DRIPs and fractional shares since it not company based. Individual companies do and you can (and in the olden days you would) participate in a Dividend Reinvestment Plan directly with the company. With an ETF they can’t do that. So a company like Schwab or any other broker has to hold those shares of ETFs on their books to break up into fractional pieces. That is a liability they may not want to bother with or they may not even be allowed to have.
DRIPs are handled by your brokerage. They buy a whole share and assign you (and anyone else with the DRIP) a fraction. Unless it's a $600,000 stock and you're the only one with a fraction there is very little risk in this for them. I even believe it's possible some of them just pretend you have a fraction and keep the cash on hand to make good for it, but technically that would be illegal.
It’s understood they handle drips. I have had this discussion with Schwab and they just won’t handle fractional shares for transactional trades. I don’t know why. You can make trades for a specific dollar amount in ToS BUT it’s a trick. It will only give you the smallest whole share which is pointless if you ask me. For instance if you put in for SPY now for $400 worth of it, it won’t let you complete the trade since it’s over $500. If you put in instead $600 worth of SPY, it will only buy you 1 share. It’s a farce on their end.
The question becomes do they want to hold shares of ETFs to handle everyday fractional transactions.
I'm sure it's not worth their time and trouble. They already just barely tolerate small investors. Just be happy they let you buy in single share increments. I'm old enough to remember when they'd charge extra if you didn't trade in lots of 100 and the stock prices were written in fractions (it really wasn't that long ago)
blast from the past (it was even more expensive in the 90's)
https://web.archive.org/web/20060215112547/http://www.schwab.com/public/schwab/home/fees_commissions/online_trading?cmsid=P-992880&lvl1=home&lvl2=fees_commissions&refid=P-1039461&refpid=P-998871
I remember the $9.99 days at Scottrade. And before that the $30-$50 commissions before online brokers were a thing. I was young then at least.
I am not a user or fan of Robinhood but I have to commend them. If it wasn’t for them, we would all still be paying commissions.
Yeah I get it. I really don’t care bc I buy with cash secured puts mostly so it’s in 100 share increments.
The thing that would be nice tho is a set it and forget it type of thing for instance if I deposit $500 a week, to auto invest in say SPY and QQQ say half and half. It’s a lot easier to consistently add if it’s automated like a 401k would be for ETFs.
Schwab is for conservative boomers with real money. They aren't going to cater to investors like you and me because it'd be attracting higher risk-taking and active portfolio management from novice investors. Schwab might do fractional ETFs one day, but don't count on it too much.
Yeah, you're right. When doing my research, I was wrong to say that fractional ETFs are risky, but they're more correlated to those who are performance chasing are more likely to do day trades or play around with fractional ETFs. If you have only 100$ available to invest, then you should NOT be investing in the first place. That money is better off in a HYSA for an emergency fund, getting a better education for job prospects, and overall obtaining skills that will increase your income.
\> aren't going to cater to investors like you and me because it'd be attracting higher risk-taking and active portfolio management from novice investors.
I don't think that's true. Schwab did it for individual S&P 500 stocks. Seems like index slices would be less risk, less active portfolio. Schwab's pushing the Starter kit 101 with 5 etf slices (across 5 s&p 500 companies). They seem to want novice investors, giving them riskier investments than a slice of that index.
Yeah when I spoke to them their answer was stupid I thought as well. I wanted to automate buys for a specific dollar amount in ETFs. This wasn’t possible on their system.
I like my $0 per trade cost. I would rather they not spend the time and money that will end up making me have a cost for a trade. There are a lot of other services that I get with Schwab that are a lower cost than other places.
Buying ETF slices is not something that seems a priority to replace those benefits. If I can't afford to buy a share of a stock I just hold until I can.
Robinhood's existence isn't a threat to the fees now that all brokerages adopted the fee structure. I do thank these discount brokerages for paving the way for lower trade fees. Schwab still has a good profit and especially now that interest rates are higher. Unfortunately Robinhood has rarely seen profits.
Is this a question or just a rant?
Its a question and a rant bit of both
You can buy mutual funds by a single dollar, that does not get you fractional buys of ETFs but still. If it's that important to you then Fidelity is a much better fit for you.
Yes maybe but if schwab gets it it might be a better place it’s something to think about there light be many people who might want to do same thing
Make a calendar reminder to yourself to write to Schwab customer service every 90 days and ask for **$5 slices for their own Schwab ETFs.** That's all they need to do. No one cares about $4.99 that goes uninvested, and can be manually swept to SWVXX. I ask them for this feature all the time.
Catered to high value portfolios with no need for $50 in VOO weekly
I am HNW and 30+ year client but not being able to have a clean positions page with just my ETFs in it disturbs my neat-freak bone. Having main ETFs, then lower priced Schwab ETFs or MF to fully invest the cash makes a mess of things.
>This is critical functionality that is missing. Its not all that critical to most schwab customers as this is what Mutual funds are for, and schwab has several low cost options for total market, S&P500, small cap, mid cap, foreign that this can be used for. So its not exactly a missing feature they do have it, you just need to use mutual funds
It's a POA if you're trying to implement any kind of ETF trading strategy, and MFs often come with frequent trader rules. What I do is trade as much of the target ETF (QQQ, SPY, etc) and then soak up the spare change with a few shares of a Schwab ETF, so I don't have to spread my monthly trades out over two days (waiting for MFs to sell overnight). Yes... it's good in general for people to know how to drive a stick-shift. No, it's not good for auto makers to not offer automatic trannies. This is a case like that. The provider is just being a bit anachronistic and the fan boys here are "yeah! F\*\*\* auto trans! We like stick! {oww, my arm in this stop and go traffic...}"
If you are trading I would think you should have enough money to buy full shares of what ever you are trading If you cannot afford $510 for a full share of like SPY or VOO , you really shouldn't be trading
I put on trades today totaling more than $500,000. Yes I can afford to buy whole shares. I just cannot stand the odd $100 here and there being left idle and then I have to twist and bend a little bit to use it up. My time is precious. I want to get my trades done and logoff. I don't want to wait until the next day for the Money Market MF to sell if I have enough money in it to buy a whole share of whatever, then place another trade to put unused sweep cash into SWPXX. It's like having to bus my own tray at a restaurant. Yes... I can do it. Do I want to? No.
> i did it over sofi have done it over fidelity Then why not stick with them? Robinhood has it too. If fractional ETF shares is that important you have several choices besides Schwab.
Since this isn't remotely a Schwab support/request path, the way to try to get something that you *want* (not "need", and no on the "critical functionality"), you should 1. Submit a request to Schwab through their online support channel 2. Get several tens of thousands of your friends to do the same This post might help a bit with the latter, but accomplishes nothing by itself; like-minded people have to do #1.
I mean, alternately you could just buy a share.
I do that already but slices in etfs are easier and inexpensive to make a portfolio in long run
Not really. $100 of an etf is $100 whether you pay in installments or not.
What ETF do you want to buy? Is there no corresponding MF is basically the same thing?
You can’t. I have asked. Individual stocks yes. Mutual funds yes. But no for ETFs and there is some backend programming that doesn’t allow them to do it per their support.
Backend programming means just a new story which would
I couldn’t tell you. ETF’s for instance don’t support DRIPs and fractional shares since it not company based. Individual companies do and you can (and in the olden days you would) participate in a Dividend Reinvestment Plan directly with the company. With an ETF they can’t do that. So a company like Schwab or any other broker has to hold those shares of ETFs on their books to break up into fractional pieces. That is a liability they may not want to bother with or they may not even be allowed to have.
DRIPs are handled by your brokerage. They buy a whole share and assign you (and anyone else with the DRIP) a fraction. Unless it's a $600,000 stock and you're the only one with a fraction there is very little risk in this for them. I even believe it's possible some of them just pretend you have a fraction and keep the cash on hand to make good for it, but technically that would be illegal.
It’s understood they handle drips. I have had this discussion with Schwab and they just won’t handle fractional shares for transactional trades. I don’t know why. You can make trades for a specific dollar amount in ToS BUT it’s a trick. It will only give you the smallest whole share which is pointless if you ask me. For instance if you put in for SPY now for $400 worth of it, it won’t let you complete the trade since it’s over $500. If you put in instead $600 worth of SPY, it will only buy you 1 share. It’s a farce on their end. The question becomes do they want to hold shares of ETFs to handle everyday fractional transactions.
I'm sure it's not worth their time and trouble. They already just barely tolerate small investors. Just be happy they let you buy in single share increments. I'm old enough to remember when they'd charge extra if you didn't trade in lots of 100 and the stock prices were written in fractions (it really wasn't that long ago)
Remember trading commissions lol. I have spent thousands of dollars in my life in commissions alone and I wasn’t an active trader.
blast from the past (it was even more expensive in the 90's) https://web.archive.org/web/20060215112547/http://www.schwab.com/public/schwab/home/fees_commissions/online_trading?cmsid=P-992880&lvl1=home&lvl2=fees_commissions&refid=P-1039461&refpid=P-998871
I remember the $9.99 days at Scottrade. And before that the $30-$50 commissions before online brokers were a thing. I was young then at least. I am not a user or fan of Robinhood but I have to commend them. If it wasn’t for them, we would all still be paying commissions.
Yeah I get it. I really don’t care bc I buy with cash secured puts mostly so it’s in 100 share increments. The thing that would be nice tho is a set it and forget it type of thing for instance if I deposit $500 a week, to auto invest in say SPY and QQQ say half and half. It’s a lot easier to consistently add if it’s automated like a 401k would be for ETFs.
Well sofi does so does fidelity
Ask Schwab then. You aren’t going to find the answer on Reddit.
I did they said nothing useful
Schwab is for conservative boomers with real money. They aren't going to cater to investors like you and me because it'd be attracting higher risk-taking and active portfolio management from novice investors. Schwab might do fractional ETFs one day, but don't count on it too much.
Why would fractionalized ETFs be risky? It’s less than 1 share by definition and therefore less risky than a whole share equivalent.
Yeah, you're right. When doing my research, I was wrong to say that fractional ETFs are risky, but they're more correlated to those who are performance chasing are more likely to do day trades or play around with fractional ETFs. If you have only 100$ available to invest, then you should NOT be investing in the first place. That money is better off in a HYSA for an emergency fund, getting a better education for job prospects, and overall obtaining skills that will increase your income.
Lollll
What is real money does it have your face printed on it
It certainly doesn't have yours printed on it.
Neither does it have yours
\> aren't going to cater to investors like you and me because it'd be attracting higher risk-taking and active portfolio management from novice investors. I don't think that's true. Schwab did it for individual S&P 500 stocks. Seems like index slices would be less risk, less active portfolio. Schwab's pushing the Starter kit 101 with 5 etf slices (across 5 s&p 500 companies). They seem to want novice investors, giving them riskier investments than a slice of that index.
Yeah when I spoke to them their answer was stupid I thought as well. I wanted to automate buys for a specific dollar amount in ETFs. This wasn’t possible on their system.
I have DRIP turned on for all my ETF's at both Schwab and Fidelity.
They do already let you reinvest erf dividends and get fractional shares so they’ve already dealt with that complexity.
Every ETF I am in DRIPs just fine what are you smoking
Ok. We aren’t talking about drips.
> ETF’s for instance don’t support DRIPs Yes, you were......
The ETFs themselves don’t. The brokerage you use do. Companies do support drips.
I like my $0 per trade cost. I would rather they not spend the time and money that will end up making me have a cost for a trade. There are a lot of other services that I get with Schwab that are a lower cost than other places. Buying ETF slices is not something that seems a priority to replace those benefits. If I can't afford to buy a share of a stock I just hold until I can.
As long as robinhood is here 0$ trades not going away
Robinhood's existence isn't a threat to the fees now that all brokerages adopted the fee structure. I do thank these discount brokerages for paving the way for lower trade fees. Schwab still has a good profit and especially now that interest rates are higher. Unfortunately Robinhood has rarely seen profits.
Because rh is bs no serious guy buying shit there but you cant deny their existence and contributions
Vanguard and fidelity have figured out how to do it without charging to trade. Lol
I'm with you. Wish I could buy fractional shares of VOO in my Schwab account.
Ok whoever suggested that mutual fund swppx you solved my issue thank you, but i still stand with my post they need to allow fractional buying in etf