Winterflood Business Services (WBS) will offer trading and custody of ETFs on a fractional share basis from July.
The new service allows the trading and custody of ETFs to four decimal places.
It broadens access to the ETF universe for platforms, discretionary fund managers and financial advisers, which have been impeded by a lack of access, high transaction charges and the absence of fractional share dealing, says head of WBS Alex Kerry.
Kerry says the fractional share service is a “watershed moment” for ETFs in the UK retail market.
“Increasingly, both advisers and discretionary managers want to access the low costs and broad exposure that ETFs can provide – especially through model portfolios and on platforms,” Kerry says.
“With increased understanding of the benefits ETFs can provide to underlying clients and the wider trend for passives, there are now real signs the ETF market is poised to take off. We are already seeing some advisers and discretionary fund managers keen to substitute some funds for ETFs, when comparable in terms of access and cost.”