Last modified: December 8th, 2022 at 12:32 pm
Is Hatch or Sharesies better? It’s all dependent on what you want to invest in and how much you want to invest (and how many shares you want to buy!)
Sharesies gives you access to NZ and US stocks and funds and is usually cheaper for making smaller-sized investments (<$500). Hatch only gives you access to US stocks and if you’re planning on investing more than $500, is usually the more affordable option. However, that’s not always the case. Continue reading to find out why.
- Get $5 FREE when you sign up to Sharesies.
- Get $10 FREE when you sign up to Hatch (and make an initial deposit of $100 NZD or more.)
Digital investment platforms make investing simple. They appeal to anyone who is looking to invest money. In New Zealand, two of the main digital investment platforms are Hatch and Sharesies.
Both of these platforms allow people to invest in opportunities in NZ and the US, but it can be tricky figuring out which one is better for you.
This guide will highlight the similarities and differences between the platforms and provide information that will help you decide whether Hatch or Sharesies is the right digital investment platform for you.
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What is a Digital Investment platform?
Investing can be complicated; digital investment platforms like Hatch and Sharesies allow anyone to start investing without the confusion.
They allow you to create your own investment portfolio in minutes by providing opportunities to invest in businesses and funds in NZ and the US.
Investing used to be a big-money game, with Hatch and Sharesies it doesn’t matter if you have $5, $500, $5000 or more, you can quickly start an investment fund and begin your investment portfolio in minutes.
How to tell which digital investment platform is right for you?
Some digital investment platforms have a monthly subscription cost. This is important to consider because this can add up over time. If you are planning on investing small amounts it’s important to do your maths and work out the total costs of the trade fees along with the monthly charge.
Just like regular brokers, digital investment platforms have transaction (brokerage) fees. These vary between platforms and are very important to consider. You may end up paying less with every trade on specific platforms, but more in monthly charges (depending on the size of your investment)
Before selecting a digital investment platform, it’s essential to look at what opportunities will be available for you to invest in. The availability or unavailability of specific opportunities could dramatically affect the returns you can make on your initial investment.
The Similarities between Hatch and Sharesies
As digital investment platforms, Hatch and Sharesies are very similar.
Both platforms provide access to 3,000+ companies and exchange-traded funds on the New York stock exchange, Nasdaq, and the Chicago Board Options Exchange, however, Hatch doesn’t allow you to invest in businesses or funds on the New Zealand stock exchange, while Sharesies does.
Neither Sharesies nor Hatch have an app. They are both browser-based platforms.
They both offer an adequate level of support to their customers. Sharesies can be contacted via email or on their social media profiles, and Hatch has a phone call in service which we think is better, because it provides resolutions instantly.
Both Sharesies and Hatch are NZ owned. Local NZ investors privately own Sharesies and Hatch is owned by Kiwi Wealth which is part of the Kiwi Group Family.
Hatch vs Sharesies
The differences between the platforms are the most important factors to consider as these are very important in figuring out which platform is right for you.
To sign up with Sharesies, you need to pay a monthly subscription fee. There are three main options. If your investment portfolio has less than NZD$50, the service is free, if it has NZD$50-$3,000 it is NZD$1.50/month. If you have more than NZD$3,000 in your portfolio, it is $3/month. Or you can opt-in for the annual subscription which is $30/year.
You do not need to pay monthly to use Hatch.
The trading fees for both platforms vary dependent on how both the volume and the value of the shares you are buying or selling.
With Hatch, it can get a bit confusing. If you are trading 300 shares or less, there is a flat fee of USD$3. For every share above the original 300, it is USD 1c for each share. So if you buy or sell 306 shares, the total cost will be USD$3.06.
Sharesies doesn’t have a flat fee; instead, you pay a percentage of the trading amount. When you order $3,000 or less, worth of shares, you pay 0.5% of that trade. If you are buying or selling more than $3,000 worth of shares, you pay an additional 0.1%.
For example, if you made an order of $6,000, it would include a $15 transaction fee for the first $3,000, (0.5% of 3000 is 15) and 0.1% of the other $3,000, (0.1% of 3000 is 3). This means that you would pay a total transaction fee of $18.
Foreign Exchange rates
When you want to purchase shares in the US, you need to transfer your NZD to USD and the same the other way. You can do this with both Sharesies and Hatch; however, their foreign exchange rates are different. Both platforms use the current “interbank or wholesale” add a fee on top of the current interbank exchange rate.
- Sharesies adds 0.4%
- Hatch adds 0.5%.
Hatch is slightly more expensive; however, Hatch allows you to use third-party foreign exchange services (like TransferWise) where you might be able to find a better conversion rate. Sharesies does not allow this. If you use Sharesies, you have to use their foreign exchange services.
Foreign Exchange rates with Hatch
|NZD||Interbank rate||USD||Hatch’s fee||Total USD|
Foreign Exchange rates with Sharesies
|NZD||Interbank rate||USD||Sharesies’ fee||Total USD|
Portfolio Transfer rate
If you want to transfer your portfolio of investments, you can do so with Sharesies and Hatch. The cost of doing so varies between the two platforms.
It is free to transfer into your portfolio with Sharesies, and it costs $5 to transfer out.
Hatch hasn’t stated a specific price when transferring in and out of investment portfolios; however, they have said “We’d love you to transfer your existing US shares to Hatch and will help cover any fees. The fee to transfer shares out of Hatch depends on your new provider and fractional shares can’t be transferred,”
This means that Hatch will assist with the fees your broker charges for the move.
Hatch vs Sharesies comparison
Comparing the two services side-by-side isn’t straightforward because each pricing model is so different.
- Hatch charges USD$3 for the first 300 shares and then USD$0.01 per share thereafter.
- Sharesies charges 0.5% on your $3,000 worth of investments and then 0.01% thereafter + monthly charges (see above).
This usually means Sharesies is cheaper for making smaller-sized investments (<$500), but if you are going to be investing more than $500, then Hatch is the more affordable option.
However, that’s not always the case.
When the share price is low, and you’re therefore able to buy more shares per dollar, Hatch can become a lot more expensive. For example, T-Mobile shares only cost USD$0.12, so investing USD$1,000 in T-Mobile would buy you 8,333.33 shares. Sharesies would charge you USD$5.00 for this transaction (or USD$10 if you already have a portfolio worth over USD$3,000), whereas Hatch would charge you USD$83.33.
Hatch (in USD)
|Investment||T-Mobile TMUSR ($0.12)||GE ($11.63)||Apple ($135.37)||Amazon ($3,277.71)|
|$100||833.3 shares ($8.33 fee)||8.60 shares ($3.00 fee)||0.74 shares ($3.00 fee)||0.03 shares ($3.00 fee)|
|$1,000||8,333.3 ($83.33 fee)||85.98 ($3.00 fee)||7.39 ($3.00 fee)||0.31 ($3.00 fee)|
|$10,000||83,333.3 ($833.33 fee)||859.85 ($3.00 fee)||73.87 ($3.00 fee)||3.05 ($3.00 fee)|
Sharesies (in USD)
|Investment||T-Mobile TMUSR ($0.12)||GE ($11.63)||Apple ($135.37)||Amazon ($3,277.71)|
|$100||833.3 shares ($0.50 fee)||8.60 shares ($0.50 fee)||0.74 shares ($0.50 fee)||0.03 shares ($0.50 fee)|
|$1,000||8,333.3 ($5.00 fee)||85.98 ($5.00 fee)||7.39 ($5.00 fee)||0.31 ($5.00 fee)|
|$10,000||83,333.3 ($22.00 fee)||859.85 ($22.00 fee)||73.87 ($22.00 fee)||3.05 ($22.00 fee)|
Sharesies vs Hatch: Verdict
Both Sharesies and Hatch offer Kiwis an excellent, and user-friendly, way to interact with stocks and shares via their digital-investment platforms.
For those looking to invest in New Zealand companies, Sharesies is clearly the better option as Hatch only offers access to US companies.
Confusingly, it’s impossible to say which option is the most cost-effective for your budget because of the unique way each platform has structured its pricing.
However, if you’re looking for a quick and dirty (and slightly inaccurate) rule of thumb…
There’s a big caveat though.
If you plan on investing in stocks with a low share price, then things can add up fast using Hatch – as it charges $3 for the first 300 shares and then $0.01 per share thereafter. This means investing in companies such as T-Mobile – where the share price is only USD$0.12 – is more cost-effective with Sharesies (depending on the size of your investment, of course).