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Fractional shares?

Dividends & tax

When you reinvest dividends can you get fractional shares with them or do you have to wait until you get enough dividends to purchase a whole share?

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Gabbi Marsh

Asked on 3 November 2022

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Alexander Mayer

Investor

Tue, 16th January 2024

When dividends are funneled back into a dividend reinvestment plan (DRIP), the received funds are utilized for acquiring extra shares of the company’s stock. In cases where the dividend doesn’t cover the cost of a full share, the fractional portion is generally retained by the plan administrator until it accumulates to a point where a whole share can be purchased.

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