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ARTICLE · 23 MAY 2023

Fractional Investments: Key Takeaways

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In recent times, there has been a surge in the number of investment firms and credit institutions operating exclusively online through websites or apps.

BelgiumFinance and Banking
Vanessa Marquette
Vanessa Marquette
Julia Mierzwinska
Julia Mierzwinska
Emma Vanden Brande
Emma Vanden Brande

In recent times, there has been a surge in the number of investment firms and credit institutions operating exclusively online through websites or apps. These entities, often referred to as "neo-brokers," are actively marketing and selling fractions of shares to retail clients, which is an exciting new trend gaining popularity in Europe's online trading platforms and neo-brokers. As a result, in March 2023, the ESMA and FSMA released guidelines on the legal framework surrounding fractional investments.

Fractional investments allow investors to specify the amount they wish to invest in a particular underlying share and, in return, acquire a portion of that share. This makes it possible for retail investors to access shares that would otherwise be too expensive. Additionally, fractional investments allow for better portfolio diversification.

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