Sharesight Blog

Data entry, what’s that? Have your share trades recorded automatically!

Posted by Scott Ryburn on April 17, 2013

Our aim at Sharesight is to make share market investing as easy as possible for you. With that aim in mind, a little over a year ago we announced our newly developed contract note email import service. This saves you the hassle of having to manually record new trades into your Sharesight portfolio each time you buy and sell. Since then we have gone on to support over 30 different brokers across Australia and NZ!

For those of you who have yet to try it, here’s a quick rundown on how it all works and how to set it up (it’s really easy!).

How it works
Sharesight provides you with a unique email address for your portfolio and you instruct your Broker to send a copy of each of your contract notes to this email address.
Each time we receive an email with a contract note from your broker, Sharesight will automatically scan the attachment and create the trade record in your portfolio. As soon as the trade has been created (typically within 10 minutes) you will receive a confirmation email from Sharesight containing a link to the newly created trade. As an added bonus, a copy of your contract note is attached to the trade record in Sharesight for future reference (trust me, your accountant will love it!).

How to get started
Step 1 – Make a note of the email address for your portfolio.
To view the email address for your portfolio, you must enable the broker email import function. To do this, first click the ‘settings’ link and then click the ‘edit settings’ button below the appropriate portfolio. Look for the section titled ‘Broker Email Import’ and click the ‘enable’ button. Once enabled, the email address for your portfolio will be displayed. This is the email address where you will send your PDF contract notes for processing.

Step 2 – Check that we currently support your broker.
We maintain an up-to-date list of supported brokers here. If your broker is not on the list, ask us to support your broker by submitting an ‘idea’ to the community forum.

Step 3 – Send through your contract notes (or get your broker to do it)
Simply ask your broker to email your contract notes to the email address generated in Step 1. Alternatively you can manually forward your contract note emails or set up a mail forwarding rule – just make sure to include the name of the broker (as per our list of supported brokers) is in the subject line of the email.

That’s it, your portfolio will now be kept up to date automatically each time you trade!

Will Mighty River’s share price sink or swim?

Posted by Tony Ryburn on April 9, 2013

The NZ Government’s asset sales programme has generated heated debate much of which has been politically driven and ill-informed. But whatever side of the fence you are on, the bottom line is that it is going to happen at least for Mighty River Power which is the first cab off the rank. So as an investor are you going to dip your toe in the water or do you think investing in Mighty River will leave you up the creek without a paddle?

Rather than regurgitating all the factors that might impact on Mighty River’s share price after it floats I thought it might be interesting to look at how previous Government asset sales have performed for investors over the long term. Three that come to mind are Auckland Airport, Contact Energy and Vector. Recording these stocks in Sharesight on their IPO dates reveals some interesting information.

Contact Energy is obviously the most relevant to Mighty River. It listed in May 1999 and since then has produced an electrifying performance with an annualised return (including capital gains and dividends) of just under 15%. However it has suffered a power cut since September 2010 producing a total return over this period of minus 2.6%.

On the other hand Vector, being a lines company rather than a power producer, has seen its share price become tangled in the wires and it is currently below its August 2005 listing price of $3.00. But it has still produced an overall return of 5.6% courtesy of strong regular dividend payments.

Auckland Airport has been the high flyer of the trio with an overall performance of nearly 22% p.a. since it became airborne in July 1998. It is obviously in a different industry and has some unique characteristics, but it does show that previously owned Government assets can perform for investors and are unlikely to sell you down the river.

Meet the Cloud Superheroes

Posted by Scott Ryburn on March 14, 2013

Superheroes spend a lot of time in the clouds but now they’re bringing the cloud to you.

Why? So you can learn how cloud services are transforming the lives of accountants and bookkeepers everywhere—without having to read a book or spend a whole day at a boring conference.

The presentations will be short, blindingly informative and probably spandex-free, although we can’t guarantee that.

But the event is completely free. If you can save the world without raising an invoice or being registered for GST, how can you charge for beer, wine and canapés?

Here are the details:

The Superheroes

We can’t reveal their names for obvious reasons but we can say where they’re from:

Sharesight: See how this new generation, online share portfolio management system can make tax reporting a breeze and performance tracking even easier.

Shoeboxed: Learn how Shoeboxed can take a pile of paper receipts and turn it into payables invoices in your accounting package in an instant

Fathom: Watch as this management reporting and financial analysis tool reveals loads of improvement opportunities for your clients’ businesses.

Workforce Guardian: See how a cloud-based tool can help you easily manage staff and create compliant employment contracts—effortlessly.

There are even two top class MCs. Sholto MacPherson, publisher of cloudadviser.com.au and boxfreeit.com.au and a leading business technology journalist, believes cloud software will drive the greatest leap in productivity since the word processor. He’ll host the Sydney and Melbourne events.

In Brisbane, Michael Carter from Practice Paradox, a marketing and sales guru specialising in the accounting industry, will try and keep the Superheroes in check.

The Dates

Melbourne – Next Monday 18 March at Federation Square – 4.30-6.30pm

Brisbane – Tuesday March 19th at Riverside Centre – 4.30-6.30pm

Sydney – Thursday March 21st at Citigroup Centre – 4.30-6.30pm

You never know – show up wearing spandex and you may get a flight with a Superhero.

Places are strictly limited so please register now.

Product Update – Notes, File attachments, PDF reports

Posted by Scott Ryburn on April 26, 2012

We’ve recently been developing some enhancements to help you keep track of more information about your shareholdings. The following new features are now available:

File attachments
Investor, Expert, and Professional Edition customers can now upload a file attachment to each trade or dividend record in Sharesight. Additionally, you can upload up to 5 file attachments against each shareholding. This allows you to store an online copy of contract notes, dividend slips or any other relevant documentation that you receive from the company. If you’re using our Broker email import function, your PDF contract note will automatically be attached to the trade record in Sharesight so that you have a permanently accessible online copy that you can download whenever you need it.

Notes about the shareholding
In addition to the existing comments field where you can record notes about each trade or dividend, we’ve now also added a comments section for the shareholding itself. Think of this as a notepad where you can jot down any information about the share. This is a great way to communicate extra information to shared users, eg your accountant or financial adviser (or client if you use Sharesight Professional Edition).

We’ve also introduced new PDF reports so that you can download and save a great looking copy of any of the reports. The PDF download option replaces the previous ‘print’ option as printing from the PDF file offers substantial improvements to the formatting. Look for the new PDF icon next to the Excel icon at the top of the reports.

Evolving the client-accountant relationship

Posted by Andrew Bird on April 20, 2012

Time and time again, we hear from both our individual and accountant users that the topic of fees for administrative services can be a minefield.

Clients hate surprises in their bill – that extra hour or two (or five) spent chasing paperwork to get the tax return in order can leave a nasty taste in the mouth. And yet the clients often create those surprises themselves through lax record-keeping or disorganisation.

Sharesight users know that the service can save them time in gathering paperwork, which can then (in turn) save them money on basic bookkeeping fees with their accountant or tax agent.

And adding a complementary service like Xero, which automates your personal budgeting and cashflow management, can also do wonders for keeping your bill down at tax time.

But we’re also starting to hear from users that Sharesight is helping them not only save time and money, but actually create a more strategic relationship with their accountant.

Sharesight users whose admin and basic bookkeeping is taken care of via the cloud are able to redirect resources to the value-added services that really make an impact on their financial futures.

Services like advice on structuring their affairs, tax minimisation strategies and estate planning – which most of the users we speak to would like more of, but many feel restricted by the cost.

We’ve also heard from Sharesight users who are negotiating fixed-price agreements with their accountant for tax preparation or SMSF audits on the proviso that they will complete the administrative work themselves.

This elimination of those nasty surprises provides the client with certainty about their bill, but also allows the accountant to better manage workflow within their practice and create efficiency.

Cloud technology is enabling both clients and accountants to focus on the bigger picture and forge a more productive relationship. Why not discuss new ways of working together with your accountant?

Is DIY investing for you?

Posted by Andrew Bird on April 10, 2012

Here at Sharesight, we often have conversations with people who are interested in DIY share market investing, but haven’t yet taken the plunge.

These people are interested in taking more control of their financial affairs, but are often unsure of exactly what it involves and – most importantly – if it’s for them.

It’s a question that people can only answer themselves, but here are four areas to consider if you’re wondering if DIY investing is for you.

Personal interest
Interest in investing is by far the most important factor to consider. In my experience, the most successful DIY investors find managing their financial affairs intellectually stimulating and see investing as something of a hobby.

If you’re the sort of person who’s interested in the business world, reads the financial press, and already does some basic household budgeting, then you have the foundations for DIY investing. But if you think you would have to force yourself to make the effort to manage your affairs properly, DIY investing probably isn’t for you.

[ A note on budgeting: if you don’t budget, it’s hard to make investment plans since you don’t know how much you have available to invest in the first place. I always found budgeting a bit of a chore, but Xero and its automatic uploads from my bank statements have been a real game changer.]

Available funds
One of the big questions people have is how much they need to get started in DIY investing. ASX recommends a minimum of A$2,000 for direct share investing, however, I would say that you generally need at least A$10,000 before you can start creating a diversified portfolio of stocks you pick yourself. This is because brokerage when you buy and sell your stocks (typically anywhere from A$15 – 25 at a time) can quickly take a large chunk out of your funds if you’re trading low volumes. Brokerage should ideally be no more than 1 per cent of the value you trade.

Time to spare
I’ve also been asked how many hours per week people need to have to dedicate to DIY investing. This is a tricky question to answer as it really does depend on the individual.

However, what I would say is that you need to make sure you’re maximising whatever time you do have. Paperwork and administration can swallow up an inordinate number of hours, but using a service such as Sharesight can keep admin burden to a minimum – freeing you up to spend time on the interesting business of managing your investments and researching your next move.

And timeframe…
The magic of compounding means that the earlier you start investing, the better. I also subscribe to the theory of dollar cost averaging, which states that investing regularly (even a small figure such as $100 per month) is more effective over the long term than trying to pick the market with larger lump sum investments. This not only brings discipline to your investing, but also smooths out volatility (in theory at least) by balancing purchases made in ‘bad’ times with those made in the ‘good.’

Decided DIY isn’t for you?

If going it alone isn’t for you, you may wish to think about engaging a financial planner. But you will need to do your homework to find one to suit you: shop around, get some recommendations from friends, and source at least three quotes.

But I’m a strong believer that nobody cares more about your finances than you do – and a little bit of ‘hands on’ goes a long way for anyone. Even if you delegate the management of your financial affairs to a planner or accountant, you need to take ownership of what you’re delegating.

Do you think there are any other points potential DIY investors should consider?

Sharing between generations

Posted by Tony Ryburn on February 9, 2012

The decision to take control of your own share investments and run your portfolio yourself is one that, with the right management tools and information at hand, has many advantages – something we’ve discussed in numerous other blogs.

What we’d like to focus on here is an uncomfortable issue that many of us like to skirt around – often until it’s too late. And that is, what happens to a share portfolio when its owner passes away. The simple fact is that older people are more likely to own shares, and in most cases will pass them, along with their other assets, on to family members after their death.

However, unlike other more tangible assets, such as property, unless the portfolio is in order and records meticulously kept, even the most generous and well-meaning bequest can result in beneficiaries and executors spending an enormous amount of time, effort and yes, money, trying to unravel the portfolio.

That includes determining exactly what the holdings are in the first place, assessing the taxation status relating to dividends and, in Australia, capital gains. And that’s even before any decisions about what to do with the portfolio itself – whether to break it up, sell part or all of it and so forth, are made.

We’ve all heard stories about beneficiaries and executors spending months or even longer digging through piles of paperwork kept in shoe boxes and following elusive paper trails in the hope of getting a clear picture of a parent or relative’s true financial situation.

Of course, that’s not the case for all investors. Many take a different path, because they want to avoid passing on that kind of impost on to their families. Concerned about how their hard earned and often closely studied portfolios will be understood and managed after their death, in their later years one popular option for these investors is to simply cash out of their portfolios.

The fact that they are often forced to do so at a time that’s not of their choosing and may as a consequence erode the potential future value of their shares is a trade-off that many will make in the interests of clarity for their estate.

However, we would like to alert share investors to a clearer, easier and potentially more profitable path. Whether you’re the D-I-Y investor considering estate planning or the relative and beneficiary of the investor, using Sharesight to manage the portfolio in question offers a clear, simple solution.

Sharesight provides a comprehensive list of all holdings in the portfolio and detailed, up-to-the-minute records relating to all the activity within it for taxation purposes. Further, it also gives the performance information needed to help both the investor and beneficiaries make informed decisions about whether, when and what elements of the portfolio should be sold.

Another key benefit Sharesight offers for investors in this situation is its sharing feature. This enables the investor to allow others log-in privileges, so they can either view the portfolio, via ‘read-only’ access or, actually participate in its management, via ‘full access’ functionality.

Imagine both of you being able to chat on the phone about the portfolio with the screens open in front of you. It’s an ideal way to help a relative or executor become familiar with the portfolio and its performance before it becomes an estate matter, and an easy way to open up what can be a difficult or uncomfortable dialogue.

It’s also a feature that can help DIY investors retain control and visibility of their portfolios if they become ill or infirm. A trusted relative or associate, such as an adviser, can continue to manage the portfolio in the manner that’s been agreed, leaving the investor with peace of mind about his or her share investments and the ability to access them at will.

So if you’re a D-I-Y investor thinking about your family’s future, or someone who’s concerned about managing the affairs of your parents or other relatives after they pass away, now’s the time to start talking – and to look to Sharesight for the help you need.

Efficiency measures: how to boost portfolio share performance without relying on the market

Posted by Andrew Bird on January 31, 2012

Self-directed share investors are understandably primarily focused on maximising returns from their portfolios. However, what many do-it-yourself investors often don’t consider are the numerous costs associated with managing their portfolios, and the impact that these can have on their overall returns.

Because the fact is, that while investors can’t directly control the returns they are going to receive from the market, they can control how much they are going to spend on managing their share market investing. In other words, it clearly makes sense for investors to focus on factors they can control, with the aim of minimising cost and freeing up funds available for reinvestment.

There are three main areas where controllable costs are incurred. The first is seeking advice on which shares to buy and sell. Then there is the cost (brokerage) of actually doing the buying and selling. And finally there is the cost of portfolio administration. This includes the tedious – but essential – reporting associated with effectively managing a share portfolio.

To reduce these costs, an increasing number of D-I-Y investors are turning to online services. They use online advisory services for investment advice, trade online to reduce brokerage costs, and make use of smart technology platforms that automate much of the administration and generate all the data needed for taxation and accounting purposes. Utilising online services in this way provides all the functionality of a proprietary ‘wrap’ platform for a far lower price. The right kind of online investment portfolio management system can also help provide a full understanding of the true returns of a portfolio, in turn enabling investors to make more informed and cost-effective decisions. Features to look out for in an online platform include:

1. Comprehensive record keeping. Look for an online portfolio management system that provides all the information you require, leaving you free to utilise the services of any broker or investment advisor you like. This is in contrast with most wrap platforms, which bundle fees for advice and administration with brokerage, giving investors limited ability to see whether they are getting value from each component. The right online portfolio management system allows investors to disaggregate these services and select those which offer the best value for money.

2. Investment performance monitoring. Investors should look for an online portfolio management system that provides a transparent view about how each individual investment is performing. This compares with a traditional wrap platform, from which it is often difficult to determine which individual stocks are better performing.

3. Automated administration. Many D-I-Y investors become distracted by the administrative tasks associated with managing their portfolio. Many direct share owners cannot afford, or choose not to, use an accountant or financial planner to carry out this administration. This can include calculating dividends and franking credits, and capital gains. Look for an online system that can automate the recording of transactions and other relevant share investment activity, producing all the information required to complete a tax return in a few clicks.

4. Compliance. If you’re an investor managing your own super fund, aim for an online share management system that can automate the flow of data to your accountant. This will not only save considerable time, but also reduce bookkeeping and accounting fees.

Of course, the total cost efficiencies generated by using an online share portfolio management system will depend on the nature and size of the portfolio, and how actively it is traded. However, choosing an option that provides control, transparency, automated reporting and has the facility to link to other relevant software is certainly a great place to start.

Teaching your kids about the stock market: part two

Posted by Tony Ryburn on January 24, 2012

In my previous post I talked about the importance of giving kids a grounding in basic financial concepts to help them plan for the future effectively.

Users of Sharesight would agree that investing in the share market can be both financially rewarding and personally satisfying, and I know that many of us are keen to get our children involved in some way.

So, what do we need to teach young people about share market investing once we’ve helped them get a basic understanding of financial concepts?

Here are my top share market basics that any investor needs to understand before they get started.

1. Only invest what you won’t need to liquidate
I’ve said it before, but I’ll say it again. Unless you’re a professional trader, share investing is a long-term business. Over a period of many years, the share market will generally outperform other investments. But if you need to withdraw your money at short notice, you run the risk of having to sell when markets are low, which could cause you some serious losses.

2. Be prepared to ride the ups and downs
Short-term market turbulence can be disconcerting and many investors at the moment are nervous about their on-paper losses. However, numerous studies have shown that share markets do better over the long term, so sticking with it will usually be a better option. Nonetheless, if you’re not prepared to ride out the lows for the sake of longer term gains, then stock market investing probably isn’t right for you.

3. Diversify
Diversification is important for two reasons: it can potentially protect you against undue losses if investments in a particular company, sector or asset class fail, and it can actually improve the overall return of your portfolio.

To get your kids thinking about diversification, help them buy a small portfolio of 3-5 shares in different industries. The share market makes diversification easy because almost every industry is well represented. Don’t overdo the diversification though. It does not guarantee success and if it’s overdone it adds complexity and it can dilute returns if it results in investment in lower yielding assets. For more on diversification see Andrew Bird’s article here.

4. Do some easy homework
Start off buying into well-known companies that have been around for a long time. Look for companies that do things you understand and operate in areas that are likely to grow in future. Thinking about some basic questions will quickly highlight industries with good potential. What is the future of the Australian mining industry? What are the implications of our aging population? Will tourism remain a growth industry?

5. Keep an eye on performance
Share investing may be a long-term business, but that doesn’t mean you can take your eye off the ball. There may be times where you want to sell down some of your holdings, or reallocate some of your exposure to maintain diversity. Staying abreast of the performance of your shares is important, and you can do this by reading the financial press and specialist websites, and subscribing to a service that will give you an overall picture of your portfolio’s performance, such as Sharesight. But remember that you are in there for the long haul so resist the temptation to panic and sell if prices take a short term tumble. Make your decisions on what you believe are long term trends, not short term volatility.

6. Don’t fall prey to “shoebox syndrome”
As all share market investors know, the benefits of being in the market come with responsibilities to the tax office. If you’re not prepared to keep your paperwork in good order throughout the year, or use an online share portfolio management service such as Sharesight to do it for you, you most likely will end up in a last-minute scramble to get your affairs in order.

What other tips do you have for teaching your kids (or grandkids) about the share market?

Sharesight teams up with CMC Markets Stockbroking

Posted by Tony Ryburn on January 19, 2012

We are excited to announce that we have partnered with CMC Markets Stockbroking to integrate our two services. This allows CMC customers to link their CMC online broking account to a Sharesight portfolio and have all past and future share trading transactions automatically recorded into Sharesight.

CMC clients will be spared the task of having to manually enter all their historic trades when setting up their Sharesight portfolio and any future share trades will be automatically synchronised to Sharesight. Best of all, customers with small portfolios will be able to take advantage of Sharesight’s new free plan to manage their portfolio in Sharesight at no cost. Our standard Investor and Expert plans will also be available to customers who require the additional functionality.

The CMC partnership is another significant step towards our ultimate goal which is to make life easier for investors by fully automating the administration and management of investment portfolios.

We are working hard to ensure similar functionality is available to all share market investors. We are in discussions with a number of other brokers about providing similar functionality and our ultimate goal is to provide seamless connections to all brokers in Australia and NZ. Feel free to let your favourite broker know that you would like them to implement this service as well!

How do I connect my account to CMC?

If you are a CMC client this functionality will be rolled out over the next month. CMC will host a dedicated page on their site which will provide customers with the opportunity to create a new Sharesight account or link an existing account. Transactions will then be automatically recorded in Sharesight as soon as a trade is completed in the CMC system.

Our press release and related press coverage can be found here.