These types of certificates represented loans in amounts smaller than the smallest bonds that companies issued. Most fractional bonds represented down payments on $1,000 bonds.

Depending on the company, these certificates were also called fractional bond scrip or fractional bond warrants. Some companies made interest payments to bond holders with these certificates and then made them redeemable only through the purchase of company stocks or bonds.

Generally, fractional bonds are plain in appearance. They seldom show vignettes. As a rule, fractional bonds include a large amount of text explaining redemption policies and dates.

Send an email message with corrections, questions or comments about this page. (Last updated Mar 2, 2010)