We are thrilled to announce that Alpaca now supports industry-leading limit orders and extended hours trading for fractional shares.
Trading in fractional shares is a crucial tool for investors. It opens the door for individuals to invest in stocks that may have been out of reach otherwise. Fractional orders also enables ultra-fine precise asset allocation and portfolio weightings. Portfolios, regardless of their size, can leverage this feature. Alpaca's fractional shares trading platform is powered by our custom-built Order Management System (OMS), designed for ultra-low latency and scale to accommodate millions of investors worldwide.
Today, this feature extends to support limit orders with fractional quantity or notional value, in addition to market orders we previously supported (stop and stop limit will also be coming soon). These additional order types are essential to manage the risks in the fast-moving market and fractional shares trading can now be used for advanced trading strategies for better risk management.
The support of limit orders for fractional shares trading comes with pre-market (4:00 a.m. - 9:30 a.m. ET) and post-market (4:00 p.m. - 8:00 p.m. ET) support in addition to the regular trading hours. Expansion of fractional shares to extended hours gives more opportunities to global investors, who will enjoy fractional shares trading in their morning and afternoon in Asian, Middle East, and European time zones.
These new capabilities are seamlessly integrated into the existing API, and your code can start using them with minimal effort (please see below for more details). Alpaca is committed to keeping the API simple and easy to use.
The introduction of these new features positions Alpaca at the forefront of the retail trading sector, setting it apart from many other brokerage firms that do not offer the same extensive range of options as Alpaca's fractional trading offering. With over 5,000 fractional assets available for trading, Alpaca has managed to maintain high standards of execution quality and speed. This achievement comes despite the challenges of market risks, thanks to our sophisticated risk management technologies and adherence to regulatory requirements, including trade reporting.
The advancement of our fractional shares trading is in line with our mission of opening financial services to everyone on the planet by building a global de-facto standard investment platform. We continue to invest in our technology and brokerage services to provide better experiences to investors worldwide.
Expand Trading Hours for Your Customers in the Regions
Through Broker API, you can now allow your customers to trade fractional and notional amounts, during their localized trading hours, further improving access to US markets internationally. With the same Orders API you use today, just update your API call to specify the extended hours flag and change the order type to limit. No other changes are needed. Use Assets API to determine which symbols are eligible for fractional trading in extended hours.
Manage Your Portfolio with More Precision
With additional order type support for fractional shares trading, it gives more precision to your rebalancing and direct indexing strategies. You can now avoid unexpected price movement with these order types while you are automatically rebalancing your portfolio to adjust to your model. It also gives you a more mathematically precise way of trading to maximize your capital efficiency in an automated fashion.
How to Place a Fractional Limit Order for Extended Hours via API
The following order parameters are supported for fractional limit orders on equities:
- Order can be configured using either "qty" of shares or "notional" amount
- Time in force must be "day"
- Type must be "limit"
- "limit_price" must be populated as type "limit" is set
- Extended_hours parameter must be passed with a value of “true”
Notional Order Example
{
"symbol": "SPY",
"side": "buy",
"type": "limit",
"time_in_force": "day",
"limit_price": "300",
"notional": "845",
"extended_hours": true
}
Quantity Order Example
{
"symbol": "SPY",
"side": "buy",
"type": "limit",
"time_in_force": "day",
"limit_price": "300",
"qty": "0.75",
"extended_hours": true
}
Product Key Features
- Trades can now be expressed with a fractional amount, whether it's for a specific quantity (e.g., 2.6 shares) or a notional amount (e.g., $25 of AAPL).
- Access expanded investment opportunities as traders (Alpaca and partner’s end-users) can engage in fractional ownership of stocks based on their budget and risk tolerance.
- Fractional limit orders can be executed not only during standard market hours but before (4:00 am - 9:30 am ET) and after (4:00 pm - 8:00 pm ET) regular market hours.
- Offering swift order execution and processing
Conclusion
Alpaca now supports limit orders and extended hours trading for fractional shares trading. To learn more about Fractional Limit Orders, please take a look at our documentation and FAQs
Let's See How We Can Partner Together
Extended Hours trading has unique risks and is different than trading in the main trading session, for more information please visit our Alpaca Extended Hours Trading Risk Disclosure
All investments involve risk and the past performance of a security, or financial product does not guarantee future results or returns. There is no guarantee that any investment strategy will achieve its objectives. Please note that diversification does not assure a profit, or protect against loss. There is always the potential of losing money when you invest in securities, or other financial products. Investors should consider their investment objectives and risks carefully before investing.
Securities brokerage services are provided by Alpaca Securities LLC ("Alpaca Securities"), member FINRA/SIPC, a wholly-owned subsidiary of AlpacaDB, Inc. Technology and services are offered by AlpacaDB, Inc.
This is not an offer, solicitation of an offer, or advice to buy or sell securities or open a brokerage account in any jurisdiction where Alpaca Securities are not registered or licensed, as applicable.
