This article was originally published in July 2017, for a more updated opinion on Sharesies, check out this article.
Sharesies have had their beta product available to a select number of users for a few weeks now. I jumped at the chance to give it a go as soon as I heard that it was coming out – you can read all about my experiences with the product so far!
If you want a quick Sharesies refresher, here’s my interview with Sonya.
Disclaimer: This isn’t a sponsored post, I’m just a big ol’ fan of Sharesies
What is their beta product?
It’s an online app that allows you to buy and sell units of six different Smartshares funds, which are divided into Conservative, Balanced and Growth depending what’s in them.
You purchase units of funds through the app, and Sharesies completes the order the next day.
It’s awesome that Sharesies are offering Smartshares funds. This way, you can invest in a Smartshares fund from as little as $5 as opposed to the usual. $500 minimum
$500 is a lot of money, especially if you’ve never invested before and might not be certain that it’s right for you.
Making the minimum really low allows anyone to get their feet wet and become an investor.
Another benefit of the Sharesies platform is that unlike investing directly through Smartshares, you don’t have to pay a $30 upfront fee each time you invest in a fund.
Currently, you only have to pay the $30 Sharesies one-off fee (and you get a $20 bonus to start investing with!).
$30 is the annual subscription you pay to be a user, and it’s the only fee you pay on their platform. You still pay the regular management fees on Smartshares funds, which range between 0.35% and 0.70%.
What was signing up like?
Signing up was a pretty easy, standard thing – all I had to do was enter in all my details and prove who I was. Obviously, with any financial product like this one, it’s incredibly important to check people actually are who they say they are, in order to comply with AML (anti-money laundering guidelines).
As a final step, a letter gets sent out to you with a code you can use to prove your address.
Within no time I was in and had access to the app.
What was using the app like?
The app is really simple and straightforward to use. Here’s a picture of what it looks like below
As you can see, you’ve got a list of funds on the right and your options on the left.
When you click your name, you get a breakdown of your portfolio. Currently, you can only see what your overall portfolio is worth, and your investments are broken down by fund. You can also see what % of your money is spread across Conservative, Balanced and Growth funds.
Sonya has said that in the future they plan to better show you how your portfolio is performing in a clear and easy to understand way.
Also, I found this out by accident – the little “? “ on the top right allows you to chat to one of the Sharesies crew. Really cool to be able to chat directly to one of the creators
What information is provided about each fund?
When you click on the funds themselves, you see a brief blurb telling you what the fund is as well as many other details of the fund how it can make you money and capital gains and dividends.
At this stage, though, there’s no information there on past rate of return or how you might expect it to perform in the future.
They also don’t have the management fee of the fund on the app. Management fees are important things to take into account when choosing which funds to buy into, and it’s a key piece of information the app is currently missing.
Is it easy to buy and sell units?
SO EASY OMG. You just have to put in how much you want to spend on any particular fund, then the transaction is processed for you the next day.
You can set up an AP with your bank, but this only puts money onto the app. You’ll still have to manually purchase your shares. It’s pretty easy on there though, so it’s not a very big deal.
Currently, you can only fund your purchases with transfers from a bank account. Credit cards and debit cards aren’t accepted.
Personally, I would like to be able to use my credit card as it’s easier (+ reward points!) but it’s still fine if you set up an AP.
Overall, I was pretty impressed. It offers investors access to Smartshares funds for a much lower amount than what they would usually have to pay. It also cuts fees down by only charging one $30 yearly fee, whereas with Smartshares you’d have to pay $30 per fund.
Overall, it just makes investing a lot easier and less stressful, especially if you’re new to the game.
I’ve read a lot of comments from people saying that they became a first-time investor using this. Awesome.
The Sharesies team are being very responsive to feedback which is good to see. In the week or so that I’ve been using the app, they’ve already fixed an issue that I was having.
Going forward, I think they need to find a balance between providing people with enough information to make informed decisions, and providing people with too much information and scaring them away.
Obviously, Sharesies isn’t trying to offer financial advice, but a little more about what type of funds suit what type of people would be great. In order to invest in a fund, you have to tick a box that says you’ve read and understood the product disclosure statement. Honestly, though, it takes a special kind of person to legit read the terms and conditions, and even the most committed and savvy of us probably won’t read the full 23 pages. It’s always good to have things like this made a bit clearer!
In the app they do link to the Sorted Investment Kickstarter which is really good – it’s basically a short quiz that helps you figure the kind of investments that would be right for you.
I really like this section below and would love to see some of these figures incorporated into their blurb about each fund (if possible).
Perhaps this could be recommended to people as part of the onboarding process.
Most people who have never invested before won’t understand just how volatile investments can be, it’s a pretty difficult concept to grasp! So the inclusion of the above figures (particularly ones that show the range your return could be) would really help with that education.
I would also love to see a feature that shows people what they could end up within however many year’s time by investing with the app (oh yeah like that super cool calculator that super cool guy Ryan made)
To finish up, I asked Sonya a few more questions about the beta and how it’s going so far.
Ryan: What kind of feedback are you getting from your users so far?
Sonya: So far, we’re getting great feedback. Customers are taking the time to tell us what they like, and what is missing that they’d find useful – which we really appreciate.
We’ve been able to make some quick changes based on the feedback we’ve been getting, and also have richer insights to help us understand what would be valuable for further product development. Key areas we’re looking into now are more performance tracking and offering more funds on the platform.
Are you attracting mostly young people? Or are you seeing people of all ages?
80% of our customers are under 40 which is pretty cool to see.
How did you choose the funds that are available now and are you planning to add more?
Smartshares ETFs are a great way to get started with investing because they’re diverse and because they have pretty low fees. We went with those specific 6 funds as when speaking with potential customers it became clear that it is important to relate in some way to your investments.
We’re planning to grow the range of funds we offer on Sharesies as we go. Sustainable options are really important so at the moment we’re working hard on getting some ethical funds onboard.
Is the $30 subscription the only fee Sharesies charges?
Yup. We charge an annual subscription of $30 which allows you to buy and sell any investments available on the platform. Any management fees charged by the underlying funds are included in the unit price.
Is there a maximum amount you can invest with Sharesies and are there a maximum number of transactions you can make, or can you just go hard?
No maximum amount you can invest. No maximum number of transactions.
How do you plan to educate your customers to help them make good investment decisions?
A ‘good’ investment is really based on your personal situation. We plan to help people assess what is best for them. At this stage, this is how we’ve designed the user experience and using plain English about how investing works. We share stories of people investing and what has worked for them, we have regular commentary from Kiwibank’s Chief Economist Zoe Wallis, and we’re looking to develop our own guides to investing to help. In future, we’re wanting to include advice into our offering.
What features do you want to add between now and when it goes live?
We have some key areas of the app to develop before coming out of beta, such as performance tracking. We have a pretty exciting roadmap planned in future around making investing more social through investment clubs, and then also providing advice to help people with their decision making. We also plan to add more funds to our platform – especially ethical.
Is a mobile app part of the eventual plan?
This is something we’ll look at once we come out of beta and developed a bit more of the core functionality. We’ve started with a web app so we can quickly roll out any changes without everyone needing to update their app every time. But as the changes become more stable, we’ll start work on the apps.
I’m loving the beta and it’s cool to hear about their future plans for the app. Def keen to see it become a mobile app as well – it’ll be way more convenient.
If you’re already using the beta app or are about to give it a go – let me know how it’s going for you!
For my more thoughts on their open-beta, check this article.