Many people have asked me the same question: Why does it cost so much to buy one share of Taiwan stocks, while U.S. stocks are so cheap? The key difference lies in the trading units.

Let's start with the most basic concept. The stock price is the price of one share, which is easy to understand. But there's a common confusion—how much one share costs versus how many shares are in one trading unit are two different things.

In U.S. stocks, the trading unit is one share. For example, Tesla's stock price is $254. Buying one share costs $254, buying ten shares costs $2,540—very straightforward. But Taiwan stocks are different. The trading unit is one "lot," and one lot equals 1,000 shares. That’s why there's such a big price difference.

Here's a concrete example. Suppose TSMC's stock price is NT$561. One share costs NT$561. But if you buy one lot of TSMC, that’s NT$561 multiplied by 1,000, which equals NT$561,000. Most retail investors can't afford that. In contrast, TSMC listed in the U.S. has a stock price of about $95. Buying one share costs only $95, which is why U.S. stocks seem so much cheaper.

Later, Taiwan introduced fractional trading to solve this problem. Fractional trading allows buying and selling less than one lot, with a minimum of one share. This gives ordinary investors a chance to participate in Taiwan stocks. But fractional trading has a drawback: lower liquidity compared to full lots, and slower matching. It uses a call auction system, matching only once per minute. In contrast, full lot trading is done on a per-transaction basis, with immediate execution and much higher liquidity.

From my experience, if your funds permit, it's better to trade full lots. Although fractional trading has a lower barrier, in practice, execution can often be less ideal.

Let's look at other differences between the two markets. U.S. stocks are calculated per share, while Taiwan stocks are calculated per lot, leading to a big difference in entry thresholds. U.S. stocks have no limit on daily price movements, but Taiwan stocks have a 10% limit. U.S. trading hours are from 9:30 PM to 4:00 AM (Daylight Saving Time), while Taiwan's are from 9:00 AM to 1:30 PM. As for transaction fees, U.S. trading is usually very cheap or even free, whereas Taiwan charges about 0.1425%.

Don't confuse face value with stock price. Face value is just a record of the initial issuance price, and most Taiwanese companies have a face value of NT$10. The stock price, however, fluctuates in real time, depending on whether the company is profitable and how investors view it. As long as investors are optimistic, the stock price will rise. For example, Tesla's stock was only $101.81 in January 2023, but by August it had risen to $254—more than doubling in less than seven months, driven by market forces.

There are three main factors influencing stock prices. First, the company's fundamentals—good financial reports and strong earnings naturally attract investors. Second, macroeconomic factors like GDP, interest rates, and inflation affect the entire market. Third, market sentiment—bad news or economic crises can cause panic selling, leading to falling stock prices.

So, if you want to know how many shares are in one lot or how much one share costs, it's quite simple. For U.S. stocks, just look at the share price—it's the price of one share. For Taiwan stocks, multiply the share price by 1,000 to get the price of one lot, or calculate based on the number of shares if trading fractional lots. The most important thing is to understand this trading logic so you can operate more flexibly in both markets.