Recently, more and more people have been asking me, "I want to invest in ETFs but don't have enough funds to buy a full share. What should I do?" Actually, this is a very good question because many popular ETFs are indeed not cheap. Take Yuanta Taiwan 50 as an example, one share costs over 160k TWD, which is a significant expense for small investors.

In fact, Taiwan has long allowed fractional share trading, so you can enter the market more flexibly. Buying 100 shares or 500 shares is fine; you don't have to accumulate 1,000 shares to buy. This makes ETF fractional trading the most practical way for small-scale investing.

The rules for fractional share trading are actually not complicated. During trading hours, you can only place electronic orders from 9:00 AM to 1:30 PM, with one match per minute. After hours, from 1:40 PM to 2:30 PM, you can place orders via phone or at the counter, with a final match at 2:30 PM. The matching rule is simple: price priority, then time priority, which is very fair.

You also need to understand the fees clearly. The normal commission fee is 0.1425% of the transaction amount, but most brokers offer discounts, some as low as 65% off. For example, buying 200 shares of Yuanta Taiwan 50 would cost about 30 TWD in fees. Recently, many brokers have lowered the minimum fee from 20 TWD to 1 TWD, so as long as you buy more than 5 shares each time, the fee is almost the same as buying a full share. When selling, you also need to pay a 0.1% transaction tax, so keep that in mind.

Regarding dividends for ETF fractional shares, the answer is yes. Whether you buy 1 share or 1,000 shares, you will receive the dividends you're entitled to, no matter how small. Many people use regular savings plans to buy fractional shares, especially high-dividend ETFs, gradually accumulating shares and dividends over time. That’s why many retail investors prefer this method.

Placing orders is also simple. In the broker’s app, select "Intraday fractional shares" or "After-hours fractional shares," choose limit order, decide whether to buy or sell, enter the quantity (1 to 999 shares), and set the price. One thing to note is that fractional shares and full shares are traded in separate pools, so the bid-ask spread for fractional shares might be larger, and liquidity may not be as good. Sometimes, it may take a while to execute.

However, if you want better liquidity, another option is CFDs. Using leverage can significantly reduce the required capital; for example, a semiconductor ETF that normally costs over $200 can be accessed with just over $20 using 10x leverage. Also, CFDs are traded 24/7, allowing both long and short positions, making them much more flexible than fractional shares. The only thing to watch out for is that CFDs have spread costs instead of traditional commissions, and the risks are higher.

Overall, for small investors, investing in ETFs is definitely feasible. Whether through fractional shares or CFDs, you can enter the market with a small amount of money. The key is to understand the pros and cons of each method and choose the one that suits you best. If you're interested, you can open an account first—many brokers now have very low thresholds.