Investing in fractional shares in an ISA – what you need to know

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What are fractional shares, what to consider and can you hold them in an ISA? We take a closer look.

This article isn’t personal advice. If you’re not sure whether an investment is right for you please seek advice. If you choose to invest the value of your investment will rise and fall, so you could get back less than you put in.

Published on 4 December 2023

It was correct at the time of publishing. Our views and any references to tax, investment and pension rules may have changed since then.

Buying a single share in high-valued companies like Berkshire Hathaway, Microsoft and Apple is a barrier for lots of retail investors. But this could soon change with the potential inclusion of fractional shares in ISAs.

Fractional shares are exactly what they sound like – fractions of whole shares of a company.

We usually use the analogy of a company’s shares being like a cake. The cake is cut up into slices and each slice is one share. With fractional shares, you can take one of those slices and cut it into even smaller pieces. As the pieces get smaller, so does the size of the share and the cost to ‘buy’ one.

This means if you don’t have £435,000 to buy a whole share of Berkshire Hathaway, you can buy a fraction of it for a lot less.

Investing in an individual company isn’t right for everyone because if that company fails, you could lose your whole