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Advisers directing clients to DIY: Hatch

Advisers are directing clients to digital platforms to carry out their investment plans, the general manager of Hatch, Kristen Lunman, says.

Thursday, September 19th 2019, 6:00AM 3 Comments

Hatch is a digital investment platform that allows New Zealanders to invest in US shares and exchange-traded funds.

Lunman said it had been noticeable in the past couple of months that a group of advisers were charging clients a fee to draw up plans for them, and then directing them to Hatch to make the investments themselves.

“We get a lot saying they’ve been referred by a financial adviser. Some are more active than others but this is an interesting opportunity that we hadn’t expected.”

She said the platform was working on ways it could develop this relationship with advisers who did not handle the execution of their clients’ investments.

Hatch would approach the advisers referring the greatest number of clients to understand how it worked with their businesses, she said.

"How does their business model work? Is it different to the traditionally business advisory model? We know obviously that it is."

She said it fit well with a recent survey commissioned by Hatch, which showed that while 72% of respondents wanted a DIY self-service, 74% wanted access to human advice alongside it.

It was also noticeable that there was a high level of personalisation happening, she said.

Clients might be working with an adviser's model portfolio but they were using Hatch to drive their investments into areas they felt strongly about, and avoid those that they did not want to be associated with, right down to things such as sugar or fast food.

The survey also found 93% of women found socially responsible investment appealing compared to 83% of men. 

“Cynics may argue that socially responsible investing is just a fad but a closer look at the forces that have driven the movement over the past 15 years suggest otherwise,” she said.

“Gathering and processing data is becoming even easier and cheaper, and investors are increasingly conscious of the social and environmental consequences of the decisions that companies make."

Among survey responding investors who did not own property, 62% of their investment portfolio was self-managed.

Tags: digital investment ESG ETFs Hatch investment responsible investing

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Comments from our readers

On 19 September 2019 at 6:53 am John Milner said:
I remember a well known planner/author advise his business model of charging for a plan then leaving the client to invest themselves was not a model he would recommend. The reason being it was not economically viable in reality. Sounds like a pipe dream of a platform provider. Could this be “fake news”?
On 19 September 2019 at 7:46 am Pragmatic said:
I’d love to see the survey & question that contributed to the statement: “...a recent survey commissioned by Hatch, which showed that while 72% of respondents wanted a DIY self-service, 74% wanted access to human advice alongside it”.

Seems like a staff survey....
On 20 September 2019 at 12:37 pm henry Filth said:
I have done this for decades. I pay a number of people for advice. Sometimes I follow it, sometimes I don't, sometimes advice from different advisers synthesizes into something quite exciting.

It's not difficult to do the mechanical of the investing.

And that way, I know who's paying my advisers.

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