3 Stocks You Can Buy With Wealthsimple Fractional Shares

The Shopify stock, Royal Bank of Canada stock, and Toronto-Dominion Bank stock are the most sought-after names on the TSX. Canadians with limited funds can own fractional shares of the three companies through Wealthsimple.

| More on:
Where to Invest?

Image source: Getty Images

Some Canadians have the appetite to invest in the most-sought after TSX stocks but find the prices a bit pricey. If you have limited funds, it’s possible to buy partial shares of Canada’s top three publicly-listed companies. You can now engage in fractional share stock investing.

Wealthsimple Trade, for example, accepts fractional orders depending on your available funds or spending capacity. You can purchase a fraction instead of a whole share of a stock. Among the eligible TSX stocks are Shopify (TSX:SHOP)(NYSE:SHOP), Royal Bank of Canada (TSX:RY)(NYSE:RY), and Toronto Dominion Bank (TSX:TD)(NYSE:TD). FAANG stocks in the U.S. are also eligible.

Tech superstar

Shopify trades at $1,819,63 per share, which is prohibitive for regular investors. But with this new offering, you can purchase half a share (0.5/100) or even one-fifth (0.2/100). In this process, you specify or dictate the amount you want to invest in Canada’s tech superstar.

In 2020, the e-commerce platform overtook RBC as the most valuable company on the TSX. As of July 16, 2021, Shopify’s market cap stands at $226.33 billion. Thus far in 2021, investors are up 26.6%. The mega-cap stock’s total return over the last 6.16 years is 5,722.82% (93.46% compound annual growth rate).

Globally trusted brand

The second-largest publicly listed company is a dividend payer, unlike Shopify. RBC trades at $127.54 per share (+24.33%) and pays a decent 3.34% dividend. Prospective investors can earn two ways, from dividends and capital gain. If you purchase fractional shares of dividend stocks, you’ll also receive payouts depending on the number of shares you own.

RBC is ideal for long-term investors, given the bank’s extensive dividend track record. The total return over the last 48.45 years is 46,969.66% (13.54% CAGR).  More importantly, you invest in this top-tier bank for dividend safety.

Canada’s largest lender is a globally trusted brand with a diversified business model. The $181.75 billion bank has also collaborated with DoorDash, a last-mile logistics platform. This new team-up with a tech company shows RBC’s desire to capitalize on the e-commerce boom.

Value for money

Price-wise and value for money, investors, can’t ignore the Toronto Dominion Bank. The $152.81 billion bank is the only company that reported top and bottom lines growth in the 2008-2009 financial crisis. As of July 16, 2021, the share price is $84.02, while the dividend yield is 3.73%.

For the first half of fiscal 2021 (six months ended April 30, 2021), TD’s adjusted net income rose 53.18% to $7.15 billion versus the same period in fiscal 2020. Notably, its provision for credit loss (PCL) went down from $4.1 billion to $64 billion. As a result, Canada’s second-largest bank has $14.6 billion in excess capital.

We can’t second guess where TD will deploy the funds, although its CEO, Bharat Masrani, gave hints recently. He said that the bank would consider returning capital to shareholders. It means a dividend increase is possible.

No stock is high-priced

Apart from the TSX’s outperformance in 2021, fractional share stock investing could attract more Canadians to invest in stocks. No stock is high-priced anymore. You can form an investment portfolio composed of the three largest publicly listed companies in the country with limited capital. Finally, you can sell fractional shares as you would any other stock.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Shopify. The Motley Fool recommends the following options: long January 2023 $1,140 calls on Shopify and short January 2023 $1,160 calls on Shopify.

More on Dividend Stocks

Female hand holding piggy bank. Save money and financial investment
Dividend Stocks

How to Turn a $10,000 TFSA or RRSP Into $415,000 for Retirement

This investing strategy has made some patient investors quite rich.

Read more »

edit Business accounting concept, Business man using calculator with computer laptop, budget and loan paper in office.
Dividend Stocks

3 Essential Stocks I’d Buy No Matter the Price

These essential stocks aren't just good options right now; they're stable choices for decades for investors looking to set up…

Read more »

Growth from coins
Dividend Stocks

TFSA Investors: Buy and Forget This Top Oversold Dividend Stock

This dividend stock has seen shares collapse this year, with a poor year expected. But does that mean it's a…

Read more »

value for money
Dividend Stocks

Income Investors: 2 Cheap Dividend Stocks With 5% Yields

These top TSX dividend stocks still look undervalued.

Read more »

Double exposure of a businessman and stairs - Business Success Concept
Dividend Stocks

Better Buy: BCE Stock or Enbridge?

BCE and Enbridge pay growing dividends with high yields. Is one more attractive today?

Read more »

Silver coins fall into a piggy bank.
Dividend Stocks

2 Unstoppable Dividend Stocks to Load Up in Your TFSA

These two dividend stocks provide long-term passive income that comes out every month, thanks to lease agreements lasting over a…

Read more »

Gold bullion on a chart
Dividend Stocks

Everyone is Talking About Barrick Gold Stock: Should You Buy?

Barrick Gold stock has lost 32% since April, underperforming the yellow metal.

Read more »

funds, money, nest egg
Dividend Stocks

TFSA: Invest $25,000 and Get $241,157 + $136/Month in Passive Income

Here’s one of the best Canadian monthly dividend stocks that could help you earn passive income for decades to come.

Read more »