If You Want a Diverse Portfolio, Choose a Brokerage Account With This Key Feature

It could open the door to a lot more buying opportunities.

You'll often hear that maintaining a nice, diverse mix of investments could be your ticket to growing wealth. And there's definitely truth to that. Plus, branching out in your portfolio could help protect you from losses during periods of stock market volatility.

Say you have a portfolio that's heavily loaded in tech stocks. If that sector crashes, you could be looking at a lot of losses. But if the tech sector is only one of many you're invested in, the blow might be minimized.

Meanwhile, choosing the right brokerage account could make it easier to build the diverse portfolio you're hoping for. And there's one specific feature to look for in that regard.

Make it easier to own the stocks you want

There are some stocks that trade for well under $100 a share. And then there are some that trade for over $2,000 per share.

If you're eager to build a diverse portfolio but you usually only manage to invest a few hundred dollars at a time, that could make it difficult to load up on stocks with higher share prices. But with the right brokerage account, being limited on funds won't have to stop you from owning a piece of the companies you're interested in.

These days, a growing number of brokerages are giving account holders the option to buy fractional shares. As the name implies, with fractional ownership, you purchase a portion of a share of stock if a full share isn't something you can afford (or if you'd simply prefer to sink less money into a single company).

So, say there's a stock trading for $600 per share that you want to own. Meanwhile, let's say you only transfer $200 into your brokerage account every month. In that case, if your brokerage account offers fractional ownership, you can simply take your $200 and use it to purchase one-third of a share of the stock you want. And if that stock then gains value, you benefit proportionally.

Similarly, a lot of stocks pay dividends to shareholders, usually on a quarterly basis. If you own one-third of a share of stock, you'll simply get one-third of its full dividend payment. It's that simple.

Build a portfolio that works for you

Before fractional investing became as mainstream as it is today, those looking to buy stocks with limited money either had to settle for companies that didn't top their lists, or otherwise had to save up enough money to buy shares of the companies that interested them. These days, fractional investing makes it a lot easier to build a diversified portfolio. And that could, in turn, bring you closer to your personal investing goals. And so if your brokerage account doesn't offer fractional investing, it could pay to move your money over to one that does.

Of course, the option to purchase fractional shares is one of many features you should seek out in a brokerage account. You'll also want to put your money into a brokerage that doesn't impose account minimums, inactivity fees, or commissions for buying and selling individual shares of stocks. Thankfully, though, all of these features have gotten increasingly easy to find, so it shouldn't be too hard to pinpoint the right home for your investment dollars.