Fractional shares...not available for foreigners?

I recently set up an investment account at a local bank in order to do some investments on the TAIEX.

Some of my Taiwanese friends have the same type of investment account. They often buy fractional shares (零股), which is especially handy for those higher priced shares which you would otherwise have to buy in lots of 1000.

They also are able to set up automatic timed investments, which can be setup to automatically buy a specified value of fractional shares in their chosen companies on a regular basis, E.G. NT$20,000 of TSMC every month on 26th day.

However, when I tried to use the fractional share buying function, the app said no. I checked with the bank contact, and he said that foreigners can’t buy fractional shares or use the timed buying functions.

So my questions:…has anyone here (non-Taiwanese) been able to buy fractional lots of Taiwanese stocks or used the timed buying function?

Is it definitely a legal restriction that foreigners (with ARC) cannot use these facilities, or is it just a policy of the bank I am using?

Will be good to hear of anyone’s experiences!

I haven’t tried fractional shares, but if the timed buying function is called 定期定額 I can confirm that it doesn’t work for me either.

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I tried to buy a fractional share of TSMC before using the bank app and it failed repeatedly . I thought it was because the order didn’t go through as clown mentions.
In the end I bought one share And left it. Have not bought anything else recently on TSE.

So unfortunately I can’t answer your question either but am interested to hear feedback. The bank clerk may be correct given our experiences…Why the hell would they put such a restriction in place ?

Keyword: recently

Most investment/trading accounts here have a minimum transactions and dates before you can use their full scope of products.

The standard in Taiwan is you have to have the account for at least 3 months and make at least 10 transactions before you can access everything. Before that you can’t short sell, day trade, buy certain ETFs, fractional share etc.

Foreigners can do all of those above, except for margin/loan, as soon as you reach the minimum requirements.

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So if this is the case, then the what the rep said (he said that foreigners can’t buy fractional shares or use the timed buying functions) sounds like another case of the go-to “foreigners not allowed” excuse, when procedural ignorance is the real reason. So annoying.

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I’m not able either. They also take 21% of my dividends and I have to reclaim later in the tax refund, local don’t have to do this. They told me if I don’t want to get tax I have to send my information to every bank that makes the dividends, sound stupid.

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Exactly. I’m able to access all functions. The only one I can’t is margin.

I also do that

Very common story unfortunately.

‘Foreigner?’
‘Computer says No’

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Thanks for your feedback.
Which bank are you using? I am set up with Sinopac.

I did some more investigation on their app. One roadblock is that when you go to the section for advanced purchase and fractional shares, you need to agree to the advance purchase “online contract”. However when I try to agree to this, it pops up this error:

This does imply that for Sinopac at least, they only let locals use this function.

To be fair to the bank worker, his comment about foreigners not being allowed was based on this message - the computer really does say No in this case!

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image

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I’m using Yuanta. If you open an account at their Dunhua South Road Securities branch they are more friendly and efficient (still takes a long time though, reserve at least 1 hour to sign all paperwork). That branch is used to have more foreigners as customers due to the location close to foreign firm offices. I tried other branches and they were so lazy even to say foreigners couldn’t open an account. So if you decide to open an account with them I’d suggest don’t waste time at other branches unless you already know somewhere there.

Fractional shares you must reach the minimum requirements first. Contact your bank and confirm/ask if it is 3 months + minimum 10 transactions.

What do you mean advanced purchase? You mean pre market orders?

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from Imgflip Meme Generator

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Would you say the banks have been:
A) Very helpful?
B) Extremely Helpful?
or C) Fucking Helpful?

I can recommend Megabank also.

Don’t bother with the banks that don’t focus on securities.

So Megabank, fubon, yuanta…Securities focus are the best. You know the ones that have a whole floor dedicated to trading and brokers (these days they are very quiet as it’s almost all online ).

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Haha love it!

It’s the function called 定期定額. It lets you setup a regular order.
Like in the example I gave above, you can setup regular orders of NT$x,000 every month to buy any shares or funds you choose. E.G. a friend has it setup to buy $20,000 of an ETF, $20,000 of TSMC and $20,000 of some other stock at the end of every month. But you can also set it for weekly, fortnightly or other time periods. It’s very flexible.

Once you’ve set it up, you don’t need to remember to do anything. It debits your account and buys the shares, so is a convenient way to gradually build up positions. You can also stop or adjust your orders, or add new ones at any time in the app.

The function needs to use 零股 to buy (as obviously $20,000 is not going to buy a regular 1,000 lot of TSMC!) .

Thanks for the suggestion about Yuanta. I’m using Sinopac Securities, not the regular bank. The guy there has been pretty helpful so far, so I’ll keep with them for the moment, and see if I can add more functions after 3 months. But I’ll keep in mind what you said, if I continue to hit problems after that.

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That function I can use only for certain ETF’s. Only full lot though. I don’t know if it is possible to buy partial as a fixed monthly purchase as I haven’t tried yet.