With “fractional unit shares”, you can even reach the stocks of super famous companies! Which securities company can buy stocks from 1 share?

When I hear news about a hit product, I sometimes think, “It would be interesting to buy the stock of this company.” If the product becomes a hit, the performance will improve, and the stock price will rise further. ――I imagine such a scenario, but do you have any experience? However, in my case, the scenario often collapses as soon as I check the stock price.
Even if you want to buy Nintendo stock, it’s “too expensive”
For example, “Nintendo (7974)”. The shortage of “Nintendo Switch” and the hit of “Atsume Kano no Animal Crossing” are still fresh in our memory, but the stock price continues to be high due to the demand for staying home since 2020. At the time of writing the article in August 2022, it is trending at about 57,000 yen per share, and if you buy it, it will be “57,000 yen x 100 shares” (since shares are traded in units of 100 shares in principle), that is, “5.7 million yen” “I need a degree. It’s not an amount that you can easily pay just because it “looks interesting” (*).

*Nintendo plans to conduct a 1:10 stock split in October 2022.
Of course, this is a slightly extreme example, and there are only a limited number of companies whose stock prices are as high as Nintendo’s. However, since the simple average of the stock prices of companies listed on the Tokyo Stock Exchange Prime Market (formerly the First Section of the Tokyo Stock Exchange) is around 2,500 yen, it costs around 250,000 yen to buy stocks of famous Japanese companies. (as of August 2022).

In fact, there are securities companies where you can buy from 1 share
“Stocks are expensive.” What I would like people who have such an image to know is the “fractional unit stock investment” introduced in this article. A unit of 100 shares is called a “unit” in the investment world, but depending on the securities company, it is possible to invest in units of “less than .

Although not all brokerages support this investment method, you can purchase stocks of well-known companies at relatively affordable prices. However, in addition to the good aspects, there are also points to be aware of in advance, such as restrictions on transactions.

Hiroki Takeuchi, an individual investor who publishes information for investment beginners through books and websites and is qualified as an FP (financial planner), we will discuss the advantages and disadvantages of investing in fractional shares. I will explain. Also, in the second half of the article, we will introduce a securities company that can actually “invest in shares less than one unit”.
“Investment in shares less than one unit” that allows you to buy shares from 1 share
Currently, the Tokyo Stock Exchange (TSE) and other stock exchanges nationwide have standardized the minimum trading unit for individual stocks to 100 shares. For example, if the stock is 100 yen per share, the minimum investment amount is “100 yen x 100 shares = 10,000 yen” (without considering fees).

“In the past, there was a time when companies had different trading units, such as 2,000 shares, 1,000 shares, 500 shares, 200 shares, 100 shares, 50 shares, 10 shares, and 1 share. For these reasons, the stock exchange announced in 2007 its policy to consolidate the trading unit to 100 shares. As a result, in October 2018, it was unified to the current ‘100 shares'” (Mr. Takeuchi, hereinafter the same).

Internet securities and smartphone securities are focusing on “investment in stocks less than one unit”
While the minimum trading unit is changing as described above, in order to meet the needs of “I want to invest from a small amount”, securities companies are implementing “Investment in stocks less than one unit” service.

Mainly targeted at those who want to build assets in the future, it is appealing as an ‘entrance to investment’. Recently, there have been some securities companies that are more advantageous to investors than before, such as abolishing commissions at the time of purchase. It seems that there is also an aim to connect it to the trading of other products with high profitability.”

Rules such as the service name and fees for “Investment in shares less than one unit” differ depending on the securities company.
You can “experience owning stocks” at low cost!
Three benefits of investing in fractional shares
What are the advantages and disadvantages of investing in shares less than one unit? I asked Mr. Takeuchi to give three of each (below, the merits and demerits of this chapter and the next chapter are Mr. Takeuchi’s commentary).
Advantage 1: Even stocks of famous companies can be invested from a small amount
The biggest advantage of fractional shares is that you can invest in stocks even if you have a small amount of money. If the stock price is 1,000 yen, you would normally need 100,000 yen, but you can buy fractional shares for as little as 1,000 yen per share (without considering fees, etc.). If this is the case, I think that many people feel that they may want to buy the stocks of companies they are interested in.

The fact that the number of purchases is small means that even if the stock price rises, the profit that can be obtained may be limited. However, even small successes can motivate you to learn more about investing.

Conversely, even if the stock price falls, you can minimize the damage you suffer. If the stock price falls by 100 yen, the loss is 10,000 yen for 100 shares, but 100 yen for 1 share. It can be said that it is relatively easy to challenge.

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