Recently, I’ve noticed that many small investors around me are asking the same question: Is it really good to sell fractional shares? To be honest, the answer to this question is more complicated than you might think.

First, to conclude, selling fractional shares isn’t that difficult, but it does require some skills and patience. Since the Taiwan Stock Exchange opened up intraday fractional share trading in 2020, the situation has improved a lot, and now buying and selling fractional shares isn’t as hard as it used to be.

The definition of fractional shares is actually very simple: stocks less than 1,000 shares, broken into smaller units. Usually, these occur because a trade was not fully executed, with the minimum trading unit being 1 share. Currently, fractional share trading is divided into two sessions: intraday trading from 9:00 AM to 1:30 PM, which can only be done electronically; and after-hours trading from 1:40 PM to 2:30 PM, which can be done electronically or by phone. It’s important to note that orders not filled during the day won’t automatically carry over to after-hours; you need to place a new order.

As for tips on selling fractional shares, I personally use two main strategies. The first is “convert fractions into whole shares”: if liquidity is poor, I buy enough shares to make a whole share and then sell the whole share, which greatly increases the chance of a successful trade. The second is to place a sell order at the limit down price during after-hours trading, because after-hours only matches once and follows the maximum transaction principle, maximizing the chance of a successful sale.

Regarding transaction fees, the calculation for selling fractional shares is the same as for whole shares: 0.1425% of the transaction amount. However, different brokerages have different minimum fee standards. From what I’ve seen, most brokerages start at around 1 NT dollar, but electronic orders often have discounts—like Fubon Securities at 18% of the standard fee, and E.SUN Securities at 20%, which makes a big difference. For example, buying 200 shares of TSMC at the latest closing price would cost about NT$300 in fees, but with a 50% discount, it’s only about NT$150—half the cost.

The advantage of selling fractional shares is that the barrier is low, making it suitable for regular fixed investments without needing a large lump sum upfront. But you also need to be aware of the disadvantages: liquidity is indeed lower than for whole shares, so transactions may take longer, and with minimum fee limits, small trades can result in higher relative costs and potential losses. Generally, it’s best to keep single transaction amounts above NT$10k to avoid losing too much profit to fees.

Additionally, a point to note is that when selling fractional shares, you must sell all of them at once; partial sales are not allowed. Also, fractional shares can pay dividends and participate in stock splits, so holding long-term can still earn dividends, which is a good advantage for small investors.

If you’re still worried about liquidity issues when selling fractional shares, you might consider trading Contracts for Difference (CFDs) for small amounts. You only need to put up margin, and the costs are lower, but this method is more suitable for short-term traders and involves daily settlement.

Overall, selling fractional shares has become a mainstream investment method for small investors in Taiwan. As long as you master trading times, fee calculations, and some basic techniques, you can enter and exit the market more smoothly. The key is to choose the right broker, understand your risk tolerance, and stay rational—avoid chasing highs or selling in panic—so you can achieve steady profits from fractional share trading.