Sharesies has emerged as a leading investment platform, particularly for New Zealanders, aiming to democratize investing and make it accessible to everyone, regardless of their starting capital. Founded in 2017, this wealth technology platform allows individuals to buy, sell, and manage investments across various markets, including New Zealand (NZX), Australia (ASX), and the United States (NYSE, Nasdaq, CBOE), all from a single, user-friendly app or website. The core mission of Sharesies is to foster financial empowerment, offering the opportunity to invest from as little as one cent, often through fractional shares. This approach breaks down traditional barriers to entry, making the stock market approachable for novice investors and those with smaller sums to invest.

How Sharesies Works: Investing Made Simple

At its heart, Sharesies operates as a digital investment platform that simplifies the process of buying and selling various financial assets. Users can create an account, verify their identity, and then fund their Sharesies wallet via internet banking or card. From this wallet, they can purchase shares in individual companies, exchange-traded funds (ETFs), or managed funds.

A significant advantage of Sharesies is its ability to offer fractional shares, meaning you can buy a portion of a share rather than needing the full amount to own a piece of a company. This is particularly beneficial when investing in high-priced stocks like those on US exchanges. The platform also provides access to a wide array of ETFs, which are baskets of assets that offer instant diversification across multiple companies or sectors.

For those who prefer a hands-off approach, Sharesies offers auto-invest features. These allow users to set up regular, automatic investments on a weekly, fortnightly, or monthly basis, ensuring consistent investment through dollar-cost averaging. Additionally, a 'round-ups' feature allows spare change from daily transactions to be automatically invested, further simplifying the process of building wealth over time.

Understanding Sharesies Fees: Transparency and Costs

Sharesies operates with a transparent fee structure, primarily centered around transaction fees and currency conversion fees. While the platform aims for low-cost investing, understanding these fees is crucial for optimizing your investment strategy.

Transaction Fees (Brokerage): Sharesies charges a transaction fee on each buy and sell order. This fee is generally 1.90% of the transaction amount, but it is capped. The cap varies depending on the market:

• New Zealand Shares: Capped at NZ$25 per order.
• Australian Shares: Capped at AU$15 per order.
• US Shares: Capped at US$5 per order.

This structure means that for smaller trades, the 1.90% fee might be the dominant cost. However, for larger trades, the capped fee becomes more favorable. For instance, a trade over approximately NZ$1,316 would hit the NZ$25 cap.

Monthly Plans: To potentially reduce transaction costs, Sharesies offers monthly plans. These plans, ranging from $3 to $15 NZD per month, include a certain value of transactions covered, making them cost-effective for regular investors who meet the plan's criteria. However, unused allowances do not roll over to the next month.

Currency Conversion Fees: When investing in international markets (Australia and the US), you'll need to convert your New Zealand Dollars (NZD) to the relevant currency (AUD or USD). Sharesies charges a 0.5% fee for this currency conversion. This fee applies both when you convert NZD to a foreign currency and when you convert it back to NZD for withdrawal.

Other Potential Fees: While not always prominent, other fees can include card processing fees for topping up your wallet with a debit or credit card (though the first top-up up to $100 may be covered), and fees for transferring shares out of the platform.

Investment Options: What Can You Invest In?

Sharesies provides access to a broad range of investment opportunities across multiple markets:

• New Zealand Shares & ETFs: Access to over 124 NZX-listed companies and 46 NZX ETFs, as well as various managed funds.
• Australian Shares & ETFs: Over 2,000 Australian shares and ETFs listed on the ASX.
• US Shares & ETFs: Thousands of companies and ETFs across the NYSE, Nasdaq, and CBOE, allowing investment in major global brands.

The platform also offers managed funds from providers like Pathfinder Asset Management, AMP Capital, and Smartshares, with management fees typically ranging from 0.30% to 1.30% (charged by the fund manager, not Sharesies).

Who is Sharesies For?

Sharesies is particularly well-suited for:

• Beginner Investors: Its user-friendly interface, low entry point (as little as $0.01), and educational resources make it an ideal starting point.
• Small-Scale Investors: The ability to invest small amounts and buy fractional shares makes it accessible for those with limited capital.
• Those seeking diversification: Access to multiple international markets allows for easy portfolio diversification.
• Parents: Sharesies offers custodial accounts for children, enabling parents to start investing for their kids early.

However, for very large portfolios or for investors who solely focus on low-cost index funds, other platforms like InvestNow might offer more competitive fee structures, especially concerning platform fees on larger balances or lower management fees on specific funds. Frequent traders might also find more specialized platforms with advanced trading tools and lower per-trade fees.

Frequently Asked Questions

Q: Do I own the shares directly when I invest with Sharesies? A: Sharesies uses a custody service, meaning your shares are held in trust by a separate company on your behalf. This protects your investments even if Sharesies were to face financial difficulties.

Q: Can I reinvest dividends with Sharesies? A: Sharesies pays dividends as cash into your wallet. You can then choose to withdraw this cash or reinvest it into buying more shares or funds. Sharesies does not currently support Dividend Reinvestment Plans (DRPs).

Q: Is Sharesies safe? A: Sharesies is a registered financial service provider in New Zealand and is regulated by relevant authorities. The custody service also provides an additional layer of security for your investments.

Q: Can I transfer my Sharesies investments to another platform? A: Yes, you can transfer shares out of Sharesies, though fees apply per investment.

Conclusion

Sharesies has successfully made investing more accessible and less intimidating for a broad audience. Its user-friendly platform, low minimum investment, and access to diverse markets make it a compelling choice, especially for new investors and those looking to diversify their portfolios. While understanding the fee structure, particularly transaction and currency conversion costs, is important, Sharesies remains a strong contender in the investment landscape. For those seeking to start their investment journey or expand their reach into international markets with ease, Sharesies offers a well-rounded and accessible solution.