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So, you’ve decided to take control of your investments. That’s a big step. And probably the most important one you’ll take as a self-directed or “DIY” investor.
Next, you’ll need to find an investment platform that’s right for you. But, with so many platforms to choose from, how do you separate the good from the bad and the ugly? To help you decide, we compiled a checklist of six questions you should be asking before taking the plunge.
Question 1
What selection of investments do you offer?
Make sure your platform offers a good depth and breadth of products from which to build your portfolio, and a balance of “Do-It-Yourself” and managed products.
You’ll want to look at how many instruments they offer. Are we talking hundreds? Thousands? Or tens of thousands? The differences can be surprising.
Another consideration is asset class. Does the platform offer multi-asset execution? Or does it focus on only one, such as equities, FX or CFDs? If you have a penchant for a particular type of investment, such as local Unit Trusts, check with them first.
Most importantly, perhaps, how does their offshore offering stack up against their onshore? Do they plug into multiple global exchanges, or do they specialise in the local JSE? This is an important lever when building a well-rounded portfolio, so make sure your platform has you covered.
Question 2
Is your platform professional AND easy to use?
Most professional investment platforms offer advanced functionality, with usability being a direct trade off.
Assuming you’re not a day-trading character out of Wolf of Wall Street, you’ll want a platform that strikes a balance: offering all the bells and whistles that are just as easy to use.
If you look at a platform like Moneybetter™, their award-winning execution engine, combines sophisticated tools with a flexible layout, making it easy to surface only the features you need. It also consolidates important features like managed investments, reporting, and quality education in one, easy-to-use platform.
Question 3
What are your fees?
Fees (or commissions) are what online investment platforms charge for their services. Some require an initial minimum deposit to fund your account.
All will charge either a flat fee, or a percentage for every trade you place—all of which will eat into the relative performance of your investments.
As with all things, you get what you pay for, so you’ll need to work out what you value and how much you’re willing to pay over in fees.
Read also: Moneybetter’s investment secrets for FFM – and why Naspers is a “banker”
Question 4
If you go out of business, what happens to my money?
The safety of your assets is a vital consideration when choosing an investment platform—if your investment platform goes under, your money shouldn’t go with them.
Ask them where your cash and assets are held, and whether your securities are retrievable should your online broker become insolvent or placed under curatorship.
Some platforms take the safety of your assets extremely seriously. Moneybetter™, for example, keeps your cash with HSBC, and makes use of Citibank as a safe custodian for your assets. And all transactions are recorded and held in a separate trust, to ensure that your money is retrievable.
Question 5
Do you provide any educational content?
The financial markets can be a wild and lonely place. You need an investment platform to not only provide the tools, but the know-how to invest with confidence.
Ask your investment platform about their educational content. Look for a blend of local and international content that is current, insightful, and trustworthy—and not just for experts, but for all levels of experience.
Question 6
What support do you provide?
A good investment platform isn’t just about the tech, it’s about the people and customer support behind the tech.
Can you find a phone number on their website? Can you speak to someone with a name, not just an automated bot?
When timing is of the essence, it’s important to know you have people you can trust looking after your account.
If the reader profile of this publication is to be believed, you’re smart enough to know that this article is sponsored by Moneybetter™. And you’d be right. Well done. So, while you’ve had to endure a shameless self-promotion of our platform in this article, we do believe it’s one of the best going around. If you’d like to find out more, visit www.moneybetter.co
Moneybetter™ is a division of SCM DMA (Pty) Ltd, FSP No. 40983 and ODP No. 45.
