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Historically, it was easier for brokers to trade stocks in multiples of 100, which are called round lots, or board lots.
Years ago, you needed to buy shares in multiples of 100. Is this still the case? Are there any difficulties in buying, say, 33 shares of a company?
—Dave Hook, Mississauga, Ont.
You can buy as many or few shares as you like. Historically, it was easier for brokers to trade in multiples of 100, which are called round lots, or board lots. But today, unless a stock is highly illiquid, you should never have a problem with “odd lots.”
That said, it rarely makes sense to buy a small number of shares. At most brokerages, the cost to trade 33 shares or 300 shares is the same (often as little as $10), but that commission represents a much smaller percentage of the 300-share order, explains Jordan Zinberg, vice-president at Donville Kent Asset Management in Toronto.
For example, if you buy 33 shares of a company trading at $20 per share, a $10 commission adds 1.5% to the price. “I think you have to think long and hard if you’re only able to buy just a few shares in something,” Zinberg says. He suggests having at least $5,000 before investing in an individual stock—otherwise it’s probably not worth your while.
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