Saxo Bank Extends Fractional Shares To Singapore Clients

Saxo Bank has announced that it has rolled out fractional shares in Singapore, showing a major milestone for the Danish investment bank. The firm stated that the new products will be available across asset classes on its platform.

With fractional shares, traders can invest in part of a whole share with whatever funds they have. This type of trading enables clients who do not have enough funds to buy high-end stocks to participate in the market. It significantly removes the difficult entry barrier to investing, making the market more interesting for everyone.

Saxo Bank Says The New Service Will Lower Entry Barrier For High-Priced Stocks

Chief Executive Officer and Founder of Saxo Bank, Kim Fournais, commented on the development. He said the new service offering enables clients to invest in high-priced shares using a smaller amount of capital.

Additionally, investors are more capable of fully utilizing all available funds when they invest precise amounts in the stocks they want. It provides more flexibility to clients in the market, enabling them to build portfolios that match different budgets.

While the idea of fractional shares is not new to a lot of traders, the service has gained increased popularity over the past few years. More brokerage firms and platforms are now offering such trading to retail investors, which lowers the entry barrier to the market. As more traders are getting to know the importance of fractional trading, regulators all over the world are also picking interest to find proper ways to keep the market safe.

Recently, the Cyprus Securities and Exchange Commission announced a clarification regarding when fractional shares should be seen as direct share ownership under MiFID II.

Last year, the US Financial Industry Regulated Authority (FINRA) rolled out a new procedure that requires brokers to report both fractional share and whole share quantities. The regulator wants to keep track of the market activities to maintain a sane and fair trading environment for traders.

Saxo Bank To Sell 70% Of Its Business To J. Safra

In another development, Saxo Bank is making a series of changes to its ownership structure as it hopes to reposition the firm for more expansion. The bank recently accepted a €1.1 billion (approximately $1.19 billion) acquisition bid from Swiss private bank J. Safra. If the acquisition is successful, the Swiss bank will have a 70% stake in Saxo Bank. The transaction values Saxo Bank at about €1.6 billion.

19. Safra will acquire the 19.8% stake that Finnish firm Mandatum has in Saxo, as well as the 49.9% stake held by Chinese Group Geely. However, Saxo Bank’s Fournais will still hold his 28% stake in the company and will retain his role as the firm’s Chief Executive Officer.