Every dividend reinvest from etrade, they add fractional shares. Where do these comefrom? I never see fractional shares trading.
The origin of the shares is from the company. A fractional-share would probably be a part of an odd-lot transaction and therefore does not appear on the tape.........maybe.
As I understand it, if it's a DRIP operated by the company, the DRIP shares come out of the company's reserves and therefore have no effect on market prices (you transact with the company). DRIP shares at a broker come from market transactions. Services like Share Builder, The MoneyPaper, etc. (which enable set up of DRIPS) go out and buy a block of shares (say monthly) and spread the shares over all newly opened DRIPs. But that involves odd lots rather than fractional shares which also come via corporate actions such as stock splits, mergers, etc.
wow (lower case). A company's outstanding shares (not to be confused with authorized shares or secondary offerings) fluctuates every month. Options to key individuals would be one example. ESOP's another. Buy backs yet another. All controlled by the stock's registrar. Likewise, for................ fractional shares. Has nothing to do with odd lots, which are whole shares, and often bundled to make round lots. Incidently, specialists fill odd lot trades first to get rid of them. Yes, registrar activity doesn't appear on tape. Neither do a lot of negoitated block trransactions (unless the parties so choose, probably for propoganda purposes). A block (which I define as 50,000 shares or more) is 180 degrees from an odd lot. Dwarfs it. To use a loose analogy, fractional shares are akin to petty cash. We won't go into requesting certificates for fractional shares. Makes some people grit their teeth.