The Five Most Popular Fractional Shares on Robinhood

Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

With immense corporations getting even bigger, it was inevitable that fractional shares would become popular. Gen Z and millennials are especially prone to buying these stocks given their student debt and uncertain prospects. Let’s take a look at the most popular fractional shares according to Robinhood.

What Comes after Free Trading?

More and more stock trading apps are becoming equalized in terms of features. Robinhood may be the first to have offered free trades, but Fidelity and eToro are close behind as they expand their trading options. Just as warring tribes spur the development of each other’s arsenals and defenses, so do popular stock trading apps develop more features to upend their competitors.

Going from 2019 to 2020, virtually all top trading platforms added fractional shares in their portfolio of services. As companies increase their valuations, each stock share rises accordingly. For many, this represents a considerable obstacle for gaining a slice of the pie from the biggest and most successful corporations in the world.

Which Fractional Shares Are Traded the Most?

Fractional shares hop over that obstacle by allowing you to buy a small piece of a share. For instance, if one stock share sells for $500, and you want to buy $10 worth of it, you would get 0.02% of the share. In other words, fractional shares represent an excellent opportunity to get in on the S&P 500 stocks, no matter your current financial situation. We’ve covered such stocks previously in our report of the next stocks to reach a $1 trillion valuation. With that said, you won’t be surprised that highly valued companies are the most popular among fractional share traders:

All of them household brands, these stocks are the most likely to be recession-proof, at least compared to less known and smaller companies. The good thing about fractional shares is that you can exactly customize the amount of money you are willing to invest, all the way down into the penny share territory. When buying these high-value stocks, it almost seems as if you being accepted into an elite country club. All thanks to fractional shares.

However, one should resist to buy them simply because they are omnipresent, global, household brands. There are reasons to believe that the economy is transforming into a collection of large corporate entities few in number. Nonetheless, even these stocks can succumb to common investor mistakes such as:

  • Falling for the bubble trap
  • Overvaluation
  • The allure of the Big Tech prestige

Therefore, it would serve you well to take some time and research their business model, management’s track record, competition, nature of the industry, its resistance to a recession, and future prospects. For most traders, these data snippets tend to coalesce into a coherent whole during day-trading, but you should never shy away from a more systemic approach through a little help from the top stock analysis software. Is there a specific value range you prefer to trade in, or is it all based on market projections?


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