Sharesies had its biggest-ever day last Monday, with its members trading around $36 million worth of stock.
Sharesies had its biggest-ever day last Monday, with its members trading around $36 million worth of stock.
Co-founder Leighton Roberts on what drove Sharesies’ biggest-ever trading day, a new partnership that’s seen a spike in KiwiSaver customers, and a reader complaint about his firm’s undisclosed partner for bank deposits.
Sharesies had its biggest-ever day last Monday, with its members trading about $36 million worth of stock.
Co-founder Leighton Roberts said that was about $3m higher than its previous record, set in late 2021 just before interest rates headed north, laying markets low around the world as investors battened down a bear market.
Trading fell as low as about $15m per day as rates were repeatedly hiked, and markets were laid low around the world during 2022 and into the beginning of 2023.
Now, “It definitely looks like trading volumes are back,” Roberts said. “January and February set records, and March is looking strong.”
He framed it, in part, as an indicator that rate cuts were on the way - just as the 2021 fallaway proved an early signal that rates would rise.
It also reflected a - related - surge of interest in United States tech stocks, notably Nvidia, the maker of chips used in AI training that has become a household name, and one of the world’s most valuable companies, over the past couple of months.
Some 25,000 New Zealanders now hold Nvidia shares through Sharesies fractional ownership platform, which provides easy access to US-listed firms.
That’s up about 80 per cent over this time last , Roberts said.
“At the same time, we’ve seen a quite strong volume out of NZX blue chips like Meridian, a2 and Fletcher Building and moving back into growth stocks like Nvidia.”
Nvidia shares - expected to soon be the subject of a stock split - have risen 281 per cent over the past 12 months from US$240.63 to US$875.28.
Its bull run has benefitted not just Sharesies’ members who bought in that right time but many KiwiSaver funds that hold the stock and the NZ Super Fund - whose 771,114 Nvidia shares were worth US$675m ($1.01 billion) at Friday’s close.
And over the past two months, about 1000 Sharesies investors have climbed into another, lower-profile chip maker on the Nasdaq: Super Micro Computer, which last week was added to the S&P500 - providing another lift for its stock, which has risen from US$92.47 to US$1140.01 over the past year. (For those who don’t want to pick individual firms, Sharesies - like its peers - offers various ETFs or exchange-tradable funds, from baskets of shares and, more recently, cryptocurrency - a faster-grower since Bitcoin ETFs finally got the greenlight in the US in the New Year; read How much Kiwis are investing in new Bitcoin funds).
Gonna be a long, long time?
About 20,000 Kiwis own Rocket Lab stock through Sharesies - or about 10 per cent more than this time last year, Roberts said. The Kiwi-American firm’s Nasdaq-listed stock has been up and down and, at US$4.42, is still well below its US$10.00 listing price. Much hinges on the much larger Neutron rocket - scheduled for its first test flight later this year (the doubts expressed in a Congressional memo notwithstanding). Rocket Lab is banking on Neutron, and its growing space services business, to get it into the black.
The high-profile NZ-founded, US-listed firm, Allbirds, currently has about 4000 NZ investors through Sharesies, which Roberts describes as a “slight decline over the last year”. The Tim Brown co-founded firm is in the midst of a restructure - including new international distribution agreements - after losing its mojo with US influencers. Its shares, which nearly doubled to US$29.80 on the day it listed two years ago, were recently trading at 87c. The firm will report its latest numbers on Wednesday.
Sharesies co-chief executive and co-founder Leighton Roberts.
Aggressive option boosts KiwiSaver
Sharesies added KiwiSaver to its platform last May, offering six base funds plus a “self-select” option that allows you to allocate a portion of your portfolio from choice of about 100 NZX-listed stocks and ETFs.
How many people have signed on to Sharesies’ various KiwiSaver offerings?
“We expect to hit 5000 this month,” Roberts said. “We’re onboarding 30 to 40 a day. There was an immediate impact from the Milford launch.” Milford Asset Management has been a longtime partner, but the firm only added its Aggressive Fund to the Sharesies mix last week.
Sharesies passed the $100m under management milestone in the New Year. Its KiwiSaver operations are on track to top $130m this month. Roberts said the average balance is about $28,000. (The Financial Markets Authority’s KiwiSaver Annual Report 2023 put the average KiwiSaver balance - across all age groups - at $28,778.)
Mystery savings partner irks customer
Sharesies also expanded into savings accounts last year. It’s currently offering 4.6 per cent per annum, with no fees, no fixed term and no minimum deposit. “It’s a pure call account,” Roberts said.
One customer contacted the Herald to say he had just signed up. He was annoyed that when he asked which bank Sharesies partnered with for deposits - he was curious if was locally owned - a support staffer emailed him: “We’re unable to disclose which bank it is as it’s commercially sensitive, but we can confirm it’s a major registered NZ-based bank, with a Standard & Poor’s credit rating of AA- (the highest rating in NZ currently).”
In fact, in a roundabout way, that did answer the customer’s question about local ownership, because S&P does not allocate ratings to Kiwibank, TSB or Heartland, according to the Reserve Bank’s register.
But beyond that, it did not narrow the field much because S&P has the same AA- on ANZ New Zealand, ASB, BNZ, and Westpac.
The partner’s identity has been the subject of speculation in various online forums.
Roberts would only say that it was “one of the big four”.
Was it confidential because the bank was not keen on its deposit holders comparing its rates with those offered by Sharesies, or vice versa?
Roberts would only offer: “That’s the contract we have in place”.
Chris Keall is an Auckland-based member of the Herald’s business team. He joined the Herald in 2018 and is the technology editor and a senior business writer.
