You'll find decimal pricing virtually everywhere that there are monetary transactions except in U.S. securities markets, which use fractions. For example, you might purchase a stock at a price of 35 . Under decimal pricing, fractions will be converted to their decimal equivalents. First, decimal prices are easier to understand. The securities industry and regulators have recently been engaged in a number of efforts to simplify the information that investors need to make informed decisions.
Decimal pricing is another.
The Securities Industry Association and the equities and options markets formed a Decimalization Steering Committee in July 1998 to develop a decimalization implementation plan and coordinate a smooth transition. Decimalization will help U.S. markets remain competitive with exchanges in other countries, which already use decimals. This issue is especially important for foreign securities that trade in both their home market and on a U.S. exchange. There are slight disparities at times as the home and U.S. market prices in decimals are rounded off to fractions and vice versa. With decimals, this would no longer be the case, eliminating the adverse effects of arbitrage trading to capitalize on slight price differentials resulting from the use of fractions and decimals in different markets for the same stock.