Recently, while researching fractional-share trading, I found that many small retail investors get stuck on the same question: how can you successfully sell fractional shares? In fact, this comes down to understanding the order for selling fractional shares and the trading mechanics behind it.

First, let’s briefly explain what fractional shares are. One stock board lot is 1,000 shares. If you hold less than 1,000 shares of a particular stock, those smaller holdings are called fractional shares. In the past, fractional shares could only be traded after hours, but starting October 26, 2020, the Taiwan Stock Exchange opened intraday fractional-share trading. This was a real game-changer for small retail investors.

Today, fractional-share trading is divided into two sessions. The intraday session is from 9:00 AM to 1:30 PM, and orders can be placed only through the broker’s app via electronic order. The after-hours session is from 1:40 PM to 2:30 PM, and orders can be placed electronically or by phone. Here’s an important point: any orders that are not filled during the intraday session will not be automatically carried over to the after-hours session—you need to place the order again.

As for the order in which you sell fractional shares, this is a detail that many people easily overlook. The matching during the intraday session happens once every minute via a call auction. The priority is price-first; if the prices are the same, the order is determined by the time you submitted your order. During the after-hours session, there is only one matching at 2:30 PM. It also follows price-first priority, but if the prices are the same, the system randomly arranges the order. That random arrangement can sometimes be a bit frustrating, but it’s simply the rule.

I personally ran into a situation like this. At one point, I wanted to sell 700 fractional shares of an unpopular stock, but none of them matched throughout the entire intraday session. Later, I learned a trick called “convert fractional to whole.” That means buying another 300 shares to reach 1,000 shares, and then selling using whole-share trading—liquidity is much better that way.

If you really need to sell urgently, there’s also a small tip for after-hours trading. Because after hours has only one matching, and it follows the maximum transaction principle, you can place a sell order at the limit-down price, which greatly increases the chance of being filled. Conversely, if you really want to buy a particular stock, you can also place a buy order at the limit-up price.

When it comes to fees, buying and selling fractional shares is the same as whole shares at 0.1425%, but there is a minimum fee, typically 1 unit of currency. Different brokers’ discounted rates vary a lot, ranging from 1.8 discounts (1.8折) to 6 discounts (6折). I recommend that the amount you buy in each time should be at least 10,000; otherwise, the fee proportion will be too high and it won’t be worth it.

The advantage of fractional shares is the low capital requirement—you can invest small amounts in popular stocks, and it also works well for dollar-cost averaging. The downside is that liquidity isn’t as good, so transaction times can be longer, and fees and trading costs are relatively higher. If your stock isn’t a popular target, no matter how you arrange the order for selling fractional shares, your chance of getting a match still won’t be particularly high.

Some people may consider using Contracts for Difference (CFD) to replace fractional-share trading, because CFDs only require posting margin, have a lower threshold, and no additional commission—only a spread. But CFDs are short-term trading instruments; they are settled daily. If you hold positions overnight, you also have to pay overnight interest. Fractional shares are more suitable for long-term investors, and you need to understand this difference.

In summary, fractional-share trading really is a good option for small retail investors to enter the stock market. But to buy and sell smoothly, you still need to understand the trading rules and the details of the fractional-share selling order, and at the same time assess your own risk tolerance.