Charles Schwab launches US fractional shares in the UK

Rick Steves

“Schwab Stock Slices are designed to make it much more affordable for UK retail investors to expand their investment options in the US market. We believe our platform provides one of the most affordable and insightful ways to invest in American businesses.”

Charles Schwab has announced the launch of Schwab Stock SlicesTM in a move that brings US fractional shares to its UK investors.

Fractional shares are rising in popularity amongst retail investors as a more affordable way to invest in leading companies as investors are able to own part of a share of a listed S&P 500 company for as little as $5, with no commission for online trades.

“Much more affordable for UK retail investors”

The service is highly customizable, giving investors the freedom to choose from up to 30 slices each time they place an order. As fractional share owners, Schwab customers will receive dividends from the companies they invest in, proportionate to the percentage of the share they own.

Richard Flynn, UK Managing Director at Charles Schwab, said: “Schwab Stock Slices are designed to make it much more affordable for UK retail investors to expand their investment options in the US market. We believe our platform provides one of the most affordable and insightful ways to invest in American businesses. Our new stock slices service, when combined with our $0 online trade commission, makes investing in the world’s largest economy easily accessible for all UK investors. The transaction volume, market capitalization, and number of listed companies make the US market a unique and attractive option for international investors.”

Last week, J.P. Morgan Self-Directed Investing also announced the introduction of fractional shares, also for as little as $5. Available on the Chase Mobile app, J.P. Morgan Self-Directed Investing allows users to trade over 800 stocks and ETFs, based on a dollar amount, with no commissions.

Clients can trade, access research, and manage investments, bank accounts, credit cards, auto loans, and mortgages from one place, as well as easily transfer money between their bank accounts and J.P. Morgan Self-Directed Investing accounts.

In March, Firstrade went live with its Fractional Share Trading service also starting with as little as $5 per stock or ETF.

Charles Schwab adds futures and forex to thinkorswim

In April, Charles Schwab expanded its trading services with the addition of futures and forex trading to its thinkorswim platform suite. This marks the first time Schwab has offered forex trading capabilities and is part of its broader strategy to integrate the services previously available through Ameritrade’s thinkorswim.

The new offerings include portfolio margining, which allows qualified traders to use a risk-based margin system that lowers the amount of capital required compared to traditional methods. This addition is expected to attract traders seeking more sophisticated risk management tools and leverage options.

As part of Schwab Trading Powered by Ameritrade, Schwab introduced more than 65 tradable currency pairs since October 2023, alongside futures trading previously only available on its StreetSmart platforms. These platforms now feature real-time charting, predefined watchlists, in-depth research, and access to dedicated futures and forex specialists.

Schwab said this expansion into global markets through forex trading provides customers with opportunities to hedge against international currency and interest rate risks, and geopolitical events. It also offers them the ability to diversify their portfolios by trading in markets that remain active outside standard stock market hours.

The launch also comes as Schwab finalizes the integration of Ameritrade’s capabilities into its own offerings to provide a unified trading experience to all its clients. The full integration is expected to complete by May, with all Ameritrade clients transitioning to the Schwab platform. In preparation, Schwab offers a paperMoney® simulated trading environment to help new traders familiarize themselves with the tools and strategies involved in these markets.

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