Basically the title. How do stock prices fluctuate by less than a cent if dollars are only normally broken down as far as cents? I routinely see prices for some stocks go up or down by this little.
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It’s not illegal to make something cost less than the minimum unit of currency, or to not have an integer number of cents. If you’re in the US, you might have noticed that gas stations often price gallons of gas including partial cents. The rounding to the cent only matters after the total price of a transaction is calculated.
If I buy 100 shares for $100.00 and then sell them for $100.01, the share price just went up by a hundredth of a cent.
it means that if you buy 100 stocks, the price of that goes up 1 cent. It’s the same deal with gasoline where prices (at least in the US) are regularly named at 9/10 cents, and crypto where prices can easily drop to a thousandth of a cent ($0.00001) overnight. In the case of sub-cent prices, it effectively means that there’s a minimum purchase of whatever amount is needed to get to one cent
While it’s possible to buy a single share of stock, that’s not how things are usually done. Normally shares are bought in bundles, and the price per share is the cost of the bundle divided by the number of shares in a bundle. Depending on the price of a bundle and its size, the cost might not divide up evenly.
it means that if you buy 100 stocks, the price of that goes up 1 cent. It’s the same deal with gasoline where prices (at least in the US) are regularly named at 9/10 cents, and crypto where prices can easily drop to a thousandth of a cent ($0.00001) overnight. In the case of sub-cent prices, it effectively means that there’s a minimum purchase of whatever amount is needed to get to one cent
It’s not illegal to make something cost less than the minimum unit of currency, or to not have an integer number of cents. If you’re in the US, you might have noticed that gas stations often price gallons of gas including partial cents. The rounding to the cent only matters after the total price of a transaction is calculated.
If I buy 100 shares for $100.00 and then sell them for $100.01, the share price just went up by a hundredth of a cent.
it means that if you buy 100 stocks, the price of that goes up 1 cent. It’s the same deal with gasoline where prices (at least in the US) are regularly named at 9/10 cents, and crypto where prices can easily drop to a thousandth of a cent ($0.00001) overnight. In the case of sub-cent prices, it effectively means that there’s a minimum purchase of whatever amount is needed to get to one cent
It’s not illegal to make something cost less than the minimum unit of currency, or to not have an integer number of cents. If you’re in the US, you might have noticed that gas stations often price gallons of gas including partial cents. The rounding to the cent only matters after the total price of a transaction is calculated.
If I buy 100 shares for $100.00 and then sell them for $100.01, the share price just went up by a hundredth of a cent.
Shares are typically trading in larger quantities, so a fractional cent can become a whole cent when shares are being traded 100 or 1000 at a time.
While it’s possible to buy a single share of stock, that’s not how things are usually done. Normally shares are bought in bundles, and the price per share is the cost of the bundle divided by the number of shares in a bundle. Depending on the price of a bundle and its size, the cost might not divide up evenly.
While it’s possible to buy a single share of stock, that’s not how things are usually done. Normally shares are bought in bundles, and the price per share is the cost of the bundle divided by the number of shares in a bundle. Depending on the price of a bundle and its size, the cost might not divide up evenly.
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