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Here’s a number that might surprise you: India has only ~26 companies with share prices over ₹10,000. Compare that to the US, where more than 500 companies have shares priced as high as ₹20,000–₹50,00,000. But buying even one share of a US giant like Microsoft or Amazon often means spending tens of thousands of rupees—something that’s not realistic for most everyday investors.
That’s where fractional investing makes a difference. You don’t need to buy a full share. With just ₹500, ₹1,000, or any amount you choose, you can invest in high-value stocks like Alphabet, Meta, or even ETFs like the S&P 500 (SPY). It makes global investing easier, more accessible, and suited to every budget.
Platforms like Vested Finance are enabling this shift by helping Indian investors get easy, RBI-compliant access to US markets. In this article, we’ll walk you through how fractional investing works,what to keep in mind before you start, and how you can begin building your global portfolio—one step at a time.
What is Fractional Investing?
Fractional investing lets you buy a part of a stock instead of the entire share. Think of it like buying a slice of cake instead of the whole thing. If Tesla is trading at $240 and you have only $20, you can still own about 0.083 shares. The same applies to Apple or Google— You wouldn’t need to wait until you have the full amount for one share—instead, you can start small and still participate in the stock’s growth.
You’ll still earn returns, benefit from price appreciation, and even receive dividends (in proportion to your share), just as someone who owns a full share.
Why You Can Buy Fractional Shares in the US, But Not Yet in India
In India, fractional share ownership is currently restricted. The Companies Act 2013 prohibits holding less than one full share, and SEBI regulations reinforce this rule. While SEBI has recommended allowing fractional shares, and the Company Law Committee has suggested amending the law, progress is still underway.
In contrast, the US market supports fractional investing through its flexible broker-dealer structure. Brokers in the US can hold stocks under their name, split them internally, and offer fractional units to clients. Indian brokers, acting only as agents, are limited by the current structure where all shares must be held by depositories like CDSL and NSDL.
There’s hope for change: the International Financial Services Centres Authority (IFSCA) has approved fractional investing within its regulatory sandbox, hinting at possible future reforms that could open up similar opportunities in India.
How Fractional Shares Work in the US
In the US, it’s the brokers—not the companies themselves—who make fractional shares possible. When you place an order for a portion of a stock, the broker buys a full share on your behalf and then splits it internally. So if you put in $100 for a stock priced at $1,000, the broker owns the full share but credits 0.1 of it to your account.
The pricing is simple: it’s proportional to the market price at the time you place the order. For example, if Google’s stock is trading at $2,500, and you invest $250, you’ll receive 0.1 shares. While most brokers process fractional share orders just like full shares, some may batch these trades and execute them only during specific time windows.
Here’s a table showcasing the top 10 U.S. stocks by market capitalization as of April 23, 2025, along with their current stock prices in USD, converted prices in INR, and the minimum investment required
Exchange Rate Used: 1 USD = ₹85.45 Wise+2Wise+2Xe
| Rank | Company | Ticker | Price (USD) | Price (INR) | Minimum Investment (INR) |
| 1 | Apple Inc. | AAPL | $199.74 | ₹17,065 | ₹1 |
| 2 | Microsoft Corp. | MSFT | $366.82 | ₹31,350 | ₹1 |
| 3 | Alphabet Inc. | GOOGL | $151.47 | ₹12,942 | ₹1 |
| 4 | Amazon.com Inc. | AMZN | $173.18 | ₹14,799 | ₹1 |
| 5 | Tesla Inc. | TSLA | $237.97 | ₹20,334 | ₹1 |
| 6 | NVIDIA Corp. | NVDA | $98.89 | ₹8,452 | ₹1 |
| 7 | Berkshire Hathaway | BRK.B | $520.79 | ₹44,513 | ₹1 |
| 8 | Meta Platforms Inc. | META | $500.28 | ₹42,779 | ₹1 |
| 9 | UnitedHealth Group | UNH | $427.18 | ₹36,498 | ₹1 |
| 10 | Johnson & Johnson | JNJ | $157.75 | ₹13,475 | ₹1 |
Note: Prices are approximate and subject to market fluctuations. The minimum investment is based on purchasing a fractional share where minimum cost can be upto 2 decimals ie ($0.01).
Why Fractional Investing Makes Sense
Fractional shares open the door for more people to invest in top US companies, even if they don’t have large sums of money to start with. Here’s how they help:
- Access to High-Priced Stocks
Many US companies—like Amazon, Tesla, or Alphabet (Google)—often trade at prices over $1,000 per share. That’s a big upfront cost. With fractional investing, you don’t need to buy a full share—you can start with as little as $5 or $10, making these companies much more accessible.
- Diversification on a Budget
Putting all your money into one stock can be risky. With fractional shares, you can split even a small investment across different sectors—tech, healthcare, finance, etc.—to spread out risk. For instance, instead of investing $500 into just Apple, you could buy fractional shares in Apple, NVIDIA, and Johnson & Johnson.
- Flexible, Dollar-Based Investing
Traditional investing is share-based—you buy whole units. Fractional investing is amount-based—you choose how much money to invest. For example, rather than saying, “I’ll buy 2 shares of Apple,” you can say, “I’ll invest $100 in Apple,” no matter the share price.
- Helps with Dollar-Cost Averaging
Investing regularly—even small amounts—helps average out market ups and downs. Fractional shares make it easy to stick to a monthly plan or an SIP (like $200/month), even if stock prices change. This builds discipline and long-term growth.
- Grow Wealth Over Time
Even small investments in fractional shares have the potential to grow and compound. You also earn proportional dividends, which can be reinvested to accelerate returns over time.
How to Invest in Fractional Shares via Vested Finance
- Download the Vested app and create your account.
- Complete your KYC to activate your US stock investing account.
- Add funds in INR, which will be converted to USD.
- Browse through available US stocks and ETFs.
- Decide how much you want to invest—you can enter a rupee amount or specific fractional units.
- Place your order and confirm the trade.
- That’s it! Once the order is executed, your fractional shares will show up in your portfolio.
Are There Any Downsides to Fractional Investing?
While fractional investing opens doors for many first-time and budget-conscious investors, it’s important to be aware of a few limitations:
Limited stock availability: Not every stock or brokerage offers fractional shares. You may not always find the exact company you want in fractional form.
Transfer challenges: Unlike full shares, fractional units often can’t be transferred between platforms, making switching brokers a bit tricky.
No voting rights: Fractional shareholders usually don’t get to vote on company matters, since the full share is held by the broker.
Possible fees: Some platforms may charge small transaction or currency conversion fees, especially when investing internationally.(However, at Vested, there are no separate fees for investing in fractional shares instead of full shares)
Is Fractional Investing Safe?
Yes, it’s safe—especially when done through regulated brokers that use advanced technology to keep things transparent and secure. Most platforms use Distributed Ledger Technology (DLT)—the same underlying tech as blockchain—to maintain a detailed, tamper-proof record of every investor’s fractional ownership.
This system tracks important actions like dividend payouts, stock splits, bonus issues, and voting rights, and automatically updates each investor’s record accordingly.
By using DLT, brokers can ensure accurate, real-time updates and reduce the chances of errors or mismatches. It also helps lower operational costs and boosts efficiency—all without compromising on safety or transparency.
Forex and Tax Implications
When you invest in US stocks using Indian rupees, your funds are first converted to US dollars. The USD/INR rate at that time affects how much stock you can buy—even in fractions. For example, if ₹8,400 converts to $100 at ₹84/USD, a weaker rupee (₹87/USD) would get you only $96.
Fractional shares are taxed just like full shares:
- Dividends are taxed in the US at 25% under the India-US DTAA and must be declared in your Indian tax returns. You can claim credit for US tax paid.
- Capital Gains are taxed only in India:
- Short-term (under 24 months): Taxed per your income slab.
- Long-term (over 24 months): Taxed at 12.5% with a ₹1.25 lakh/year exemption.
For tax calculations, the SBI TT buying rate (published at the end of the prior month) is used. At Vested, you get the tax documents
Even if you hold just 0.2 shares, tax treatment is the same as owning full shares—covering dividends, gains, and disclosures.
At Vested, we make tax filing easier by providing clear, INR-converted summaries for capital gains, dividends, and foreign asset reporting, aligned with Indian tax guidelines.
Is Fractional Investing Right for You?
Fractional investing, especially through a Systematic Investment Plan (SIP), lets you own top US stocks like Amazon or NVIDIA without needing thousands of rupees. With Vested Finance, you can start a SIP in US stocks from India with as little as $5 using our Recurring Investment feature.
This makes global investing simple, affordable, and consistent. The benefits of SIP—like disciplined investing, dollar-cost averaging, and portfolio diversification—apply even to international markets. Use tools like a US stock SIP calculator to plan your SIP amount and track long-term returns.
Just be mindful of charges for US stocks, taxes, and currency fluctuations. But overall, if you’re looking to grow wealth gradually, SIP in US stocks can be a smart, low-entry strategy.
Your Window to Global Markets
High stock prices are no longer a roadblock. Fractional shares let you invest in top US companies without waiting to build a large corpus. This not only makes investing more inclusive but also allows smarter diversification.
Even though India’s current laws restrict fractional ownership, international platforms provide a practical workaround. As regulators work toward enabling fractional investing domestically, this is your window to global exposure—across AI, tech, healthcare, and more.
With proper research, tax awareness, and the right tools, fractional investing can be your stepping stone to a more balanced, future-ready portfolio.
Click here to start your US stock SIP today with Vested Finance – invest in top global companies, one fraction at a time.
