Fractional share

Fractional share

Stocks amounting to less than one full share, usually resulting from splits, acquisitions, exchanges, or dividend reinvestment programs.

Fractional Share

Less than one share of a stock or a mutual fund. One almost always purchases fractional shares as part of a dividend reinvestment program. That is, when one automatically uses dividends to buy more shares, there may be extra cash left over but not enough to buy a full share. The company or fund sponsoring the dividend reinvestment program then allows the shareholder to buy a fractional share.

fractional share

Less than one share of stock, that is, one-third or one-half a share. Fractional shares are generally created from dividend reinvestment plans or stock dividends. For example, if a firm's directors declare a 2% stock dividend, an owner of 70 shares would be entitled to 1.4 additional shares. Because corporations do not issue certificates including fractional shares, the stockholder would receive one share and the cash equivalent for the fractional share. Fractional shares are credited to dividend reinvestment plans.

Fractional share.

If you reinvest your dividends or invest a fixed dollar amount in a stock dividend reinvestment plan (DRIP) or mutual fund, the amount may not be enough to buy a full share.

Alternately, there may be money left over after buying one or more full shares. The excess amount buys a fractional share, a unit that is less than one whole share.

In a DRIP, a fractional share gives you credit toward the purchase of a full share. With a mutual fund, in contrast, the fractional share is included in your account value.

References in periodicals archive ?
The fractional share was combined by the brokerage house with
Buying a jet, or even a fractional share of one, can run well into the millions and require a multiyear commitment.
A fractional share, a unit of stock less than one full share, cannot be traded on the market.
The bank, brokerage or nominee who holds the shares must advise the Depository Trust Company ("DTC") as to their full and fractional share requirements by March 21, 2007.
The deadline for brokers and nominees to notify the disbursing agent of full and fractional share requirements is June 8, 1993.
The fractional shares will be purchased at the a pro rated purchase price based on the resulting post split fractional share owned multiplied by $10.
The exact number of shares that each claimholder ultimately receives pursuant to the Plan is dependent on the final total of allowed claims and other factors, such as unclaimed distributions and fractional share interests.
In lieu of any fractional share otherwise issuable to any holder in respect of the conversion, the Corporation will pay an amount, in cash, to the holder thereof equal to the same fraction of the current market price of a share of common stock (current market price calculated as the average of the daily closing prices for the five consecutive trading days prior to December 1, 2006).
In lieu of issuing fractional shares, the Company will round the conversion figure for the new shares up to the nearest full share for each stockholder who would otherwise be entitled to receive a fractional share.
The Bank will pay cash in lieu of any fractional shares in an amount equal to the fair market value of such fractional share as determined by a certified independent appraisal.
Should any distribution of new common stock result in a claimholder being entitled to the receipt of a fractional share, AAWW's disbursing agent will retain the fractional share until a distribution would result in a whole number of shares being distributed to the claimholder on the next applicable distribution date.
If the aggregate number of shares of the company's common stock a shareholder would otherwise receive in the special distribution consists of a fractional share or a whole number of shares plus a fractional share, such shareholder will receive, in lieu of that fractional share, an amount of cash equal to the market value of that fractional share determined for purposes of the special distribution as described above.

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