These small cap investment platforms are trying to shake things up
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Remember the days when you had to place stock market orders in the physical world?
For many of you, probably not.
Securities brokers — who conduct investment transactions for clients — have long since shifted online, saving time and money. But investors want to go even further.
In recent months, for example, there has been anticipation that commission-free trading will come to Australia but there is still no word on when.
Investors are also seeking more investment options, beyond stocks.
Two small caps in this space are not only investment platforms but are players in the equity capital markets – raising money for small caps that need it.
One is Bell Financial Group (ASX:BFG), which owns broker Bell Potter. In addition to shares, punters can trade commodities, currencies, and futures.
The other is the smaller Euroz (ASX:EZL) which is a parent company for Euroz Securities.
While Bell has gained over 60 per cent in the last 12 months, Euroz has made a slight retreat of 5 per cent.
While commission-free trading platform Robinhood has been on everyone’s lips for a number of years it is yet to enter Australia.
Meanwhile, there is no shortage of local (paid) investment platforms with innovative models – one being Goodments which charges via subscription model.
Another is BrickX, which allows for fractional investing in property. Following them last year was Avestix which is Australia’s largest crowdfunding raise – although they focus on entire portfolios rather than single bricks of property.
Among ASX small caps there’s DomaCom (ASX:DCL), which helps people already owning property to release equity in their homes to investors. It current has $63.1 million in funds under management.
Another problem with many investment platforms is a minimum investment requirement. If you want to invest spare change that’s not possible with many providers.
But Raiz Invest (ASX:RZI) – it has a platform which invests its clients’ spare change from every day purchases.
As of 31 December it had $444.7 million in funds under management and 791,000 signups – of which 211,000 were active monthly customers.
Selfwealth (ASX:SFW) is not currently a free broker but at $9.50 per trade claims to be Australia’s cheapest online broker.
It also has a platform for financial advisers which lets them trade on behalf of their clients.
While its pool of investors is small — 17,981 as of last November — this has been expanding fast in recent months.