Understanding Stock Trading Limits for Minor Accounts
- Main Problem: The user, El Mencho, is inquiring about the minimum stock price for trading in a Fidelity minor account, specifically noting that penny stocks are not allowed.
- Solution 1: Fidelity representatives clarified that users can purchase US stocks and ETFs for as little as $1 through fractional shares.
- Solution 2: Fidelity defined penny stocks as those trading below $5 per share, with a specific focus on those below $3 per share for their Youth Accounts, which cannot trade penny stocks.
- Solution 3: It was confirmed that El Mencho can invest in stocks priced at $3 and above.
Here’s the full thread
What’s the lowest $ a stock can be for a fidelity minor account to trade? Because i know it doesn’t let me trade penny stocks so i wanna know whats the lowest $ to trade
Thank you for the question!
At Fidelity, you can purchase US stocks and ETFs for as little as $1 with fractional shares. If you would like to learn more about fractional share trading, check out the link below:
Fractional shares: https://www.fidelity.com/trading/fractional-shares
Let us know if you have additional questions. 🟢
What stocks are classified as penny stocks? Because i have tried investing in $2 stocks or $3 stocks etc.
Thanks for following up, @El Mencho.
The industry generally defines penny stocks as stocks with a small market capitalization (i.e., company value) and trade below $5 per share. Fidelity’s penny stock enrollment process and controls are generally focused on stocks trading below $3 per share.
As you alluded to above, trading penny stocks isn’t currently available for Fidelity Youth Accounts, as there are risks involved with these types of stocks.
Keep us posted if you have anything else which needs clarification!
Okay thank you! so i would be able to invest in stocks that are $3 shares and up?
That’s correct, @El Mencho!