Fractional share

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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 ?
One of Marquis's selling points is that it subleases its fleet of 500 planes from NetJets, a Berkshire Hathaway company that is the top seller of fractional shares of aircraft.
Buying a jet, or even a fractional share of one, can run well into the millions and require a multiyear commitment.
Toyo Trust said it will buy these fractional shares and sell them to investors who wish to accumulate them.
Shareholders at the time of the reverse split who otherwise would be entitled to fractional shares will be issued checks in lieu of fractional shares.
Fractional shares will generally be settled in cash, except for registered shareholders with book entry accounts at the transfer agent who will have whole and fractional shares added to their account.
No fractional shares of the Corporation's common stock will be issued as a result of the mandatory conversion.
No fractional shares will be issued in connection with the reverse stock split.
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.
No fractional shares of Verigy will be distributed to Agilent's shareholders.
No fractional shares will be issued in connection with the reverse stock split, and holders of fractional shares will receive cash in lieu of their fractional shares.
The aggregate amount of cash payable to shareholders in the special distribution, other than cash payable in lieu of fractional shares, will be limited to $77 million, or approximately 20% of the total amount of the special distribution.
9 million shares outstanding, subject to reduction for fractional shares.

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