FinTech startup Stockspot has today announced the launch of a new online widget which allows investors to compare Australia’s booming $12.4 billion exchange-traded fund (ETF) market.
Using Stockspot’s free pinwheel widget, investors can compare 94 ASX-listed ETFs based on fees, distribution yield, bid/ask spread and more. In a media release, Stockspot Founder Chris Brycki explains that one of the main reasons why advisors and fund managers are able to charge exorbitant fees is because there is very little decipherable information available to investors. He says, finance industry has been a “black box, indecipherable to the average investor”. According to Stockspot, “unfair fees” made up 45 percent of managed fund returns between 2008 and 2013.
“Information asymmetry between the financial services industry and investors creates a moral hazard that has been rich pickings for unscrupulous financial advisors who have for too long been enriching themselves at the expense of consumers,” says Brycki.
Stockspot, on the other hand, aims to be ‘the fourth estate’ of the finance industry, bringing much needed transparency with the help of modern technology. Founded in 2013, Stockspot offers an automated investment service, combining personal investment advice with portfolio construction and a cloud-based architecture.
Brycki is fully cognisant of the fact that his startup has entered the $2 trillion investment industry, dominated by Australia’s four big banks and their distribution networks. But as an experienced trader, Brycki knows the industry inside-out.
“Where people do seek advice they are becoming increasingly aware of the conflicts of interest that exist within the industry. We want to help Australians cut through the many confusing messages out there to achieve the best possible long-term returns on their investments,” Brycki has stated in a previous media release.
The launch of the online pinwheel widget also couldn’t come at a better time, with the Australian ETF market hitting a record high of $12.4 billion in assets under management in August, according to BetaShares. This is up almost 50 percent in just a year.
According to Stockspot, this is being driven by self-managed super funds seeking a simple way to build diversified portfolios that include a range of asset classes including local and international shares and bonds.
The pinwheel widget, which will be updated regularly, reveals that of the 94 ASX-listed ETFs: 70 have more than $5 million under management; average fee is 0.26 percent compared to 1.91 percent for bank platform managed funds; average yield (dividend/distribution) is 3.25 percent; and average return over the last year was 9.25 percent.
In April this year, Stockspot was the first of many startups to receive funding ($250,000) from AWI Ventures – a venture fund launched by Federal Minister for Communications, Malcolm Turnbull. The startup was more recently named runner-up in the SydStart pitching competition.