Would you like to buy shares of Tesla, but do you think over $900 for one share is too much? Then you can also buy parts of the share today. You then, for example, own one-tenth of a security of the American producer of electric cars.
The Dutch online stock broker Bux, which is also active in our country, started early this year with so-called fractional investing, whereby investors do not have to buy a whole share right away. The customer indicates how much he wants to buy himself. For example, if he wants a tenth of a share, Bux buys a full share on the stock exchange and keeps nine tenths in his portfolio. The remaining tenth then goes to the investor. The nextdoor ipo is found online. If someone then buys half a share, Bux takes this out of its own portfolio, leaving it with four-tenths of a share, explains founder and CEO Yorick Naeff.
The Dutch online platform started with fractional investing in the most popular hundred American shares. Currently, the most requested titles to cut to are Tesla, Amazon, Microsoft, Meta (Facebook), and Alphabet (Google).
Other US stocks, trackers and European stocks will follow later. The latter can be expected in one to two months. Here too we will start with the most important fifty or one hundred European titles, says Naeff. The minimum investment is 10 euros.
With fractional investing, Bux mainly – but not exclusively – targets young investors who are still at the start of building up their wealth. The average age of the platform’s customers is thirty years old.
“It allows them to get a taste of the stock market and to get to know investing better,” says Naeff. Fractional investing also enables them to build a diversified portfolio with a limited capital so that they can spread their risks. A setback with one share does not necessarily have to be a disaster.
Through the Netherlands
Anyone who wants to invest with Bux must open an account with the Dutch ABN Amro, from which the transactions can be paid and to which dividends can be paid. This is entirely legal, but the opening must be reported by the investor to the Central Point of Contact of the National Bank of Belgium.
Bux is now looking into whether it can also open a Belgian branch. The decision on this will be made this year. The online broker says it already has about 100,000 Belgian customers.
The costs for a stock exchange operation at Bux are 0 or 1 euro. In the first case, the client agrees that the broker bundles all orders of that day and then executes them in one transaction. In the second case, it is immediately put on the market. “We derive our revenue mainly from a small margin on the exchange rate that we take,” Naeff said.
Other brokers say they are looking at fractional investing, but have not yet made a decision.