Korean brokerages Kakao Pay Securities, Toss Securities, and Korea Investment Securities are preparing to introduce fractional share trading services for domestic Korean stocks starting next month, according to the financial investment industry on the 23rd. The move responds to a sharp increase in high-priced stocks — as of the 22nd, 7 stocks exceed 1 million won per share (up from 0 in 2024), and 17 stocks exceed 500,000 won per share. Fractional trading allows investors to purchase portions of a single share starting from 1,000 won in 1-won increments, making expensive blue-chip stocks accessible to small investors. The service operates by brokerages pooling multiple investors' orders to purchase whole shares, then distributing fractional ownership proportionally.
Brokerages Pool Orders to Enable Fractional Ownership Distribution
Fractional share trading is a service where investors purchase portions of a single share rather than buying a whole share. Stocks priced over 1 million won per share can be purchased starting from 1,000 won in 1-won increments. Brokerages collect orders from multiple investors, purchase whole shares, and distribute fractional ownership to participants proportionally.
Most major brokerages including Mirae Asset Securities, NH Investment & Securities, and Kiwoom Securities currently offer domestic fractional trading services, though trading volumes remain minimal.
Domestic Fractional Trading Volume Reached 65.12 Billion Won from January to August Last Year
From January to August last year, domestic stock fractional trading volume totaled 65.12 billion won. This represents 1/130th of overseas stock fractional trading volume during the same period.
An industry source stated, "Excluding Mirae Asset Securities, Shinhan Investment, and Kiwoom Securities, annual fractional trading at other brokerages amounts to only several hundred million won." The source added, "Despite stock price increases this year, many investors prefer larger investments, resulting in limited fractional trading activity."
Brokerages View Fractional Trading as Alternative Revenue Source Amid Fee Competition
The brokerage industry views the current period as optimal for launching fractional trading services. The service enables creation of diverse retail offerings. Aggressive marketing of overseas stock fractional trading faces regulatory scrutiny, making domestic services a strategic alternative.
Samsung Securities recently launched a domestic stock accumulation event. The service automatically executes periodic purchases when investors set target stocks, investment amounts or quantities, and purchase intervals.
Commission Rates Range from 0.01% to 0.1% Across Brokerages
Domestic fractional trading services represent a new commission revenue stream. While brokerages offer "lifetime commission-free" promotions for standard domestic stock trading, fractional trading carries commissions similar to whole-share transactions. Mirae Asset Securities charges 0.01%, while Samsung Securities charges approximately 0.1%. Fractional trading primarily serves "accumulation-style investment," providing steady revenue streams.
Fractional Trading Mechanics Vary by Brokerage with Execution Time Differences
Investors must note differences between fractional trading and standard stock trading. Trading hours and order methods vary by brokerage. Some brokerages execute orders in batches at predetermined times rather than real-time. Voting rights may be restricted.
FAQ
What prompted Korean brokerages to introduce fractional stock trading services?
As of the 22nd, 7 domestic stocks exceed 1 million won per share (up from 0 in 2024), and 17 stocks exceed 500,000 won per share. This increase in high-priced stocks led Kakao Pay Securities, Toss Securities, and Korea Investment Securities to prepare fractional trading services starting next month, allowing investors to purchase portions of expensive shares from 1,000 won in 1-won increments.
How much domestic fractional trading volume occurred from January to August last year?
From January to August last year, domestic stock fractional trading volume totaled 65.12 billion won, representing 1/130th of overseas stock fractional trading volume during the same period. An industry source noted that excluding three major brokerages, annual fractional trading at other firms amounts to only several hundred million won.
What commission rates do brokerages charge for fractional stock trading?
Commission rates vary by brokerage. Mirae Asset Securities charges 0.01%, while Samsung Securities charges approximately 0.1%. These rates apply to fractional trades, whereas standard domestic stock trading typically carries no commission due to "lifetime commission-free" promotions.
