Fractionated coconut oil (FCO) is often used in aromatherapy and cosmetics because it is a very light, odorless oil. Massage therapists like FCO because it leaves less of a stain on clothing and sheets than other oils. It is also used in cosmetics because it gives a lighter feel to a product as well as a glide. FCO is a very stable oil in that it will not go rancid quickly giving it a longer shelf life than other oils. FCO is also used in cooking and is said to not contribute to a rise in cholesterol. 
Photo credit: Peter Davis/AusAID, CC BY 2.0,
But how does it compare to other Coconut oils? Besides FCO you can readily find coconut oils referred to as 72 degree and 92 degree.
Coconut oil 72 degrees means that it is oil pressed from the copra (meat) of the coconut and melts between 72-78 degrees Fahrenheit. Most of this is then refined and deodorized and labeled RBD, but unrefined coconut oil is also available. Virgin coconut oil is typically made from the milk rather than the copra.
Coconut oil 92 degrees melts at about 92 degrees Fahrenheit. It is similar to the 72 degree coconut oil but has been hydrogenated (hydrogen added across a double bond) so the melting point increases. It is possible to get coconut oil of higher melting point but these are less commercially available.
Fractionated coconut oil refers to only the medium chain fatty acids of coconut oil. Fatty acids which make up triglycerides, come in different lengths most fall between 4 carbons to 28 carbons. Short chain fatty acids are defined as less than 6 carbons, medium chain fatty acids defined as 6-12 carbons, long chain as 13-21 carbons and greater than 21 carbons are very long chain fatty acids.
This is how the fatty acid profile of regular coconut oil breaks down:
Long chain, saturated fatty acids:
Myristic acid (C14) 19%, palmitic acid (C16) 8%, stearic acid (C18) 3%
Long chain unsaturated fatty acids:
Oleic acid (C18:1) 5%, linoleic acid (C18:2) 2%
Medium chain saturated fatty acids:
Caprylic (C8) 8%, Capric (C10) 7%, lauric acid (C12) 48%
Fractionated coconut oil refers to just two of the medium chain fatty acids; caprylic and capric fatty acid. The INCI (International Nomenclature for Cosmetic Ingredients) for FCO is Caprylic/Capric Triglyceride. The lauric acid with 12 carbons is borderline long chain and not extracted into the FCO or also called MCT for Medium Chain Triglycerides. 
So how are they separated? The ‘fractionating’ is done first by hydrolyzing the triglyceride to separate it into glycerol and fatty acids. This is the same reaction a soapmaker uses to make soap. The fatty acids are then gradually heated so that the lower carbon chains melt first and the various fatty acids are ‘fractionated’ or separated.  This actual separation is done through distillation. Once this is finished the result is MCFA for medium chain fatty acids, rather than a triglyceride. The triglyceride is then reformed by esterification with glycerin/glycerol to reform the triglyceride or MCT for medium chain triglycerides, also the fractionated coconut oil. Fractionated coconut oil is commonly referred to as Mixed Chain Triglycerides (MCT). It’s INCI name is

Caprylic/Capric Triglyceride which refers to the carbon chain length of the fatty acids.

These reactions that occur (hydrolysis, distillation, esterification) are generally found to be acceptable in natural products and green chemistry products. The resulting product is a triglyceride that is formed from the medium chain fatty acids; caprylic and capric acid. This FCO is lightweight and absorbs well into the skin, is odorless and has a long shelf life. It is used as a carrier oil for herbalists and aromatherapists, as a dietary supplement and as a cosmetic ingredient.