35 (but looks a lot younger)
Beginner / Intermediate. Been dabbling for years.
*Disclaimer - Natalie works for Hatch.*
Why did you start investing?
I started my first company out of uni, back when 'startups' weren't a thing yet. I'd invested in my own companies, and knew enough about tech companies for the Xero IPO to be a no-brainer. But I was 23 and had never actually bought shares before.
What's your investing history from there?
After Xero had released various offers for existing shareholders, I realised I was missing out by having only one parcel of shares. I set up my own brokerage account with the National bank which was hard to do (paper forms!) but I'm fine with risk, and this felt a lot less risky than running my own company. I invested multiple times in Xero and learned a valuable lesson about the rewards of the sharemarket. On the flipside, I invested in Snakk media and saw the value of my shares wiped out, which is sadly a part of learning how the markets work.
So investing was very much your play money?
As I got more confident, I started to see the share markets as less of a place to play and more of a long term strategy to grow my wealth. Somehow I found and looked into Smartshares. I had no idea what ETFs were but liked the idea of investing in a fund that owned shares in a large number of companies. I also liked the small ($500) initial investment and set up a $100 a month transfer into 3 funds. I know $500 feels like a significant barrier for people, but I knew I needed to be thinking hundreds instead of tens for the kind of retirement I want. I upped the number of funds over time and started making one-off deposits with any spare cash. Then I joined Hatch.
Obviously, you're super biased, but have you changed your investing behaviour since Hatch launched?
I started buying small numbers of shares in US companies as soon as we launched, using very little of the intelligent analysis most Hatch investors talk about. I buy into companies that I know and use. I don't look at their reports or metrics, but I do look at the news, and the reaction/overreaction humans have to the news. I buy during the drops, and I have a buy and hold philosophy. The ups and downs aren't a huge deal because the goal is that they'll feel like nothing in 10-20 years because the value has increased so much.
I had a bunch of money in US Smartshare funds, and I was paying 0.51% fees for one of those funds, which invested 100% in a Vanguard fund we have listed on Hatch (0.035% fees). The difference sounds small, and I was worried about the impact the exchange rate would have on switching to Hatch. I thought if I stick with Smartshares, I only have the risk of the share price going up and down, whereas, with Hatch, I've got the risk of the exchange rate going up and down on top of the fees.
Interesting point on continuous learning. So where does Hatch fit for you?
Turns out Smartshares is equally impacted by the exchange rate, which means investing directly in the US-listed funds is no riskier than buying the re-wrapped funds on the New Zealand sharemarket. Sure, it'll cost me $10 more this year to switch each fund over, but in about a year, I'll be saving $100 in fees every year, on every investment. So I'm selling up my Smartshares and buying into Vanguard funds. I'm still keeping my NZ Smartshares.
Anything else you've changed as you've learned more?
I'm less likely to take punts on individual companies now. It's fun and addictive, but I don't think it's the right way for me to grow my wealth. I did, however, invest in Z and Spark this year. They both pay dividends over 7% (I basically ran through the list of companies in the NZ Dividend fund and picked two that I think are showing signs of adapting to tech changes). I'm not sure I recommend this approach, and I'm sure you should do more research than that but YOLO.
I also invested in the Punakaiki fund. It helps scratch the itch of high-risk investments and supports my belief we should invest more in growing NZ. Because it's a fund, there's instant diversification. I also read some articles about how I should risk a small percentage of my investment money on higher risk, higher return options. I thought to myself, "will I hate losing every penny of that money? Yes. Will it have a noticeable impact on my life? No", and went for it.
Best advice you've been given?
De-risk your high risks - When investing in higher risk companies, if and when the price doubles, get your initial investment money back and leave the rest in. Hello, no risk and all (potential) reward.
Just do it - I wish the myth that you have to do a bunch of research to invest would die. After you've put that first $50 or $100 in a fund, you'll start learning about shares. Having skin in the game is proven to be the most effective way to increase your education. Don't kid yourself the 'risk of losing it all' is a good excuse for apathy when it comes to investing in your future.
Pick a few funds and stick to them through the ups and the downs - The best investors probably didn't even check their balances during the downs, they just forgot about them until now. 10 years on they are probably all rich and laughing at the rest of us. Dollar Cost Averaging is the only and by far the best thing you should learn about before you start.