What is fractional investing?

Here’s How Fractional Investing with Koia Works

Fractional investing in real assets is relatively a new concept.

As a result, we often get asked how we do it and how it works?

Fractionalisation
Fractional investing lets investors buy less than the full item at one time. Instead of buying the entire asset, you can buy just a small percentage of the item. This can be helpful when asset prices are too high for an investor to be able to afford the whole item. It also makes it easier for investors to invest very precise amounts into a specific asset.

With fractionalisation, we split each asset up into smaller fractions and take care of insurance, storage and maintenance. Each asset is acquired and owned by a separate entity and as an investor you invest in the company that owns the asset.

The two main reasons for this fractionalisation method, which include;

  1. the companies that own each asset are separate from Koia, meaning that you as an investor are protected should Koia go bankrupt.

  2. Investing in companies is a tried-and-tested mechanism that is familiar to both consumers as well as regulators and a legally compliant way in which to run the business.

Process
The process is everything you need to know about what happens in the background when we put assets up on the Koia platform and how the process works for you as an investor.

  1. Sourcing & Authentication
  2. Storage
  3. Fractionalisation
  4. Tracking Performance
  5. Investment Returns

Read our ‘How does fractional investing work?’ topic to understand the process and deep dive into the various stages before an asset is listed on the platform.