Why Do Financial Advisers Use Sharesight?

We get this question all the time. Sharesight Pro was originally built for accountants so they could setup client portfolios from an historical point and then track them alongside their clients automatically. They love the time saved and tax planning discussions Sharesight facilitates. The admin-made-easy, CGT, and FIF reporting alone are worth the $12 price. Not to mention our free connection to Xero. But last year we began to notice that financial advisers were signing up and adding client portfolios by the dozens. Why? Four primary reasons:
Sharesight for Financial Advisers

We love hearing from our clients. You don’t shy away from telling us what you like, what you don’t, and what to build. So, naturally, we asked, and our adviser clients told us.

Client Demand

Our largest client base is DIY investors using the retail version of Sharesight, which given sheer numbers will always be true. People on the Investor or Expert plans are free to share their portfolios with anyone they like, including their financial advisers. Think about the pain you’ve probably gone through when hiring an adviser. Transferring assets, paperwork, logins, custodial forms, all that tedious stuff. If you’re in a generous mood, you’d chalk that up to working within the established boundaries of legacy financial systems. If you’re being pessimistic, you’d say that switching is purposefully painful and expensive. Reality is probably somewhere in between.

With Sharesight, investors can send their adviser a login in 10 seconds for no additional cost.

Our DIY population tends to be investors in-the-know. They use Sharesight because they understand the tracking and reporting shortfalls of online brokers and watchlists. When an adviser is given Sharesight access, they begin asking questions about what the product is and what it does. After all, they’re supposed to be the expert!

Client Access

This one is the inverse of Client Demand. With Sharesight Pro, financial advisers can create client logins and determine the level of access (read-only, read & write, admin). Within the client portfolio they can draft and send an invite email. When the client logs in they can follow along with their portfolio, check trades, and even run reports.

Ring-fencing clients doesn’t work anymore and quarterly statements that look like they were spooled off a dot-matrix printer are unacceptable in 2014. Switched-on financial advisers know that bringing their clients into the fold is the recipe for an informed and successful client relationship.

Sharesight’s client access feature goes way beyond what wraps and platforms offer. After all, we’re in the business of developing a killer portfolio app using cutting-edge technology. They’re in the business of gathering assets and managing money. If you were a software developer where would you rather work?

Freedom

Platforms and wraps are certainly appropriate for some clients. But we don’t think portfolio admin alone should be the determining factor in choosing to put client assets on one. In the past there wasn’t a choice. An adviser couldn’t risk tracking client holdings on a spreadsheet. Unfortunately, for investors this meant paying asset management fees for a portfolio reporting service. Madness! Now with Sharesight, an adviser can spend $144 per year (or less), record unlimited trades, and not worry about assets under management or portfolio size. We don’t care if a portfolio is made up of 100 penny stocks or $100M in Berkshire Hathaway.

When you put a portfolio on Sharesight you also have access to our growing ecosystem of connected apps. We ingest trades from 50 brokers and we push data to apps like Xero. In fact, we encourage this kind of client sharing. Now, the adviser can choose from a range of best-of-breed services.

The Data Umbrella

Ultimately, Sharesight is a passport for the client’s portfolio data. Just like you “Login with Facebook” we’re trying to do the same for portfolio data. Plus, an adviser can create multiple entities for a client or family. Maybe there’s an SMSF, an online brokerage account, an old corporate super – all can be tracked (and consolidated) within Sharesight.

What the adviser and client choose to do with the data is up to them. We’re an independent company with a laser-focus on portfolio tracking. We don’t sell investment products, we don’t provide advice or research, and we don’t offer trade execution. Our goal is to make it easy for financial advisers and their clients to use Sharesight and then hook-in to those who provide other best-of-breed services.

See how easy it is to connect Sharesight to Xero

What Apps Do We Use to Run our Small Business?

We spend a lot of time encouraging investors to make the most of the growing cloud ecosystem of connected apps. There’s Xero of course. And newcomers like Stockspot and PocketSmith. But established players like CMC are connected too. There’s even a really cool app to connect your connected apps, called IFTTT.

What Apps Do We Use to Run Our Small Business?

So we figured it’s time to shed  light on just some the apps we use to keep the engines running at Sharesight. The best thing about our cloud-based business? We can monitor EVERYTHING from our bank account to social media to development projects across about just a handful of tabs in a browser. From any computer, no downloads necessary. Paradoxically, by using cost-effective and lightweight web-apps we have far more flexibility than larger businesses, and we ensure we’re getting the latest and greatest. Larger organisations tend to build their own systems versus buying the best-of-breed. We can speak from experience, building a credit card billing system is no fun! It used to be that your job provided the best (and most expensive) technologies available. We remember how fast we thought our Dell business machines were back in the day. No more…

Google

Google Apps

Not just for search and YouTube anymore, we rely on Google more than anything else. We prefer Chrome for browsing and Android for mobile, and we exclusively use Gmail, Calendar, and Drive, but we also use Google Analytics, AdWords, and Webmaster tools to optimise our websites and to help people discover and try Sharesight. We’ve also been testing out Google Keep, their new note taking product. Pretty cool. For what we spend with them, Google offers tremendous value for a company of our size.

GitHub

GitHub

Our developers kick ass. They’ve developed Sharesight using Ruby on Rails, a highly respected web application framework according to engineers in the know. In order to keep projects organised they use GitHub, which is a cloud-based hosting service and version control system. Basically, this allows them to check-in their code, while maintaining visibility on one another’s work. GitHub also provides open source code for myriad uses and allows our guys to share some of their work. With over three million users, it’s a safe bet that some of the best technologies will surface on GitHub. To put it another way: do you think the best technologies come from a walled-off room of bank developers, or a truly open and global ideas exchange?

HootSuite

HootSuite

We talk to our clients via Twitter, Facebook, LinkedIn, Google+, blogging, etc. Using each one of these social networks in a silo would be too time consuming. So, we use Hootsuite to send and manage social media content across all platforms. Aside from visibility across social media platforms, the ability to schedule content in advance is great.

Pivotal Tracker

Pivotal Tracker

We adhere to an Agile approach to developing Sharesight. Locking ourselves into long-term development plans, buried under heavy-duty technical specs, and putting unnecessary constraints on projects is dumb. Things change fast and we develop accordingly. To maintain our project to-do list and ensure that everyone inside the company has visibility, we use Pivotal Tracker. They provide an intuitive dashboard, which allows non-technical folks to keep up with what our developers are working on. All work is distilled down to simple stories, which are represented by cards, which anyone can drag and drop depeding on their status.

Campaign Monitor

Campaign Monitor

We have a huge email database of current clients, past clients, trial users, partners, you name it. We send out newsletters, special offers, and other bits and pieces. We need to ensure that we’re sending emails to the right client segments and of course to people who haven’t opted out! Campaign Monitor not only lets us build nice looking email templates, but it also hooks into our subscriber database to ensure that all recipient lists are up to date. One of the coolest Campaign Monitor features is the geo-tracking. When we send emails to a large audience, it’s fun to watch the world map and see when and where they’re opened!

Xero

Xero

Last but not least, is Xero. We use Xero Business for everything finance-related. Ultimately, Xero replaces the need for a full-time finance role – a big savings. Our monthly financials, expenses, payroll, and tax-prep are all run out of Xero and you don’t need to be a CFA to use their app. The best part of course is that whenever a specialised need arises, there’s “an app for that!”

Announcing a New Strategic Partner: Stockspot

We’re proud to announce a new strategic partner, Stockspot. Chris Brycki and his Sydney-based firm provide fully-online, low-fee, hassle-free investing. Stockspot is Australia’s first paperless, managed discretionary account provider for retail investors (like us). They’ll put your money to work in curated ETF model portfolios and Sharesight will act as the investor-facing performance and reporting tool.  This is a big deal for investors.

Sharesight + Stockspot

Using a super simple registration process, investors are taken through a series of questions designed to gauge their risk tolerance, financial situation, investment horizon and liquidity needs. Then they’re presented with portfolio options, complete with a holdings breakdown and future performance expectations.

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Finally, it’s online!

All Stockspot portfolios are comprised exclusively of ETFs. Most from Vanguard or iShares (Blackrock), two of the most trusted and popular ETF providers. For an online, managed investment product with a $2,000 minimum, this is 100% appropriate. Once you verify your ID (again, fully-online) and fund your account (you guessed it, fully-online), Stockspot puts your money to work in one of their ETF Model Portfolios. They’ll rebalance you automatically, too.

We love ETFs. They provide the average investor with so much cost-effective choice. Broad exposure to an index, country, or theme at a low cost? Yes, please. We’re investors through and through at Sharesight. We love picking cheap stocks, but we’re time-poor, and when a good opportunity can’t be found, we invest in ETFs. The “core satellite” approach serves us well.

Stockspot not only selects high quality ETFs on your behalf, but their low fees mean you’ll have more money to invest over the long term. Studies have shown that the fees we pay to invest are the most reliable indicator of future returns – even better predictors than research houses’ ratings. If you’re someone who prefers to invest for the long term and expect to track the broad market – fees are just as important as picking an asset class, let alone a solitary fund manager or company.

Enter Sharesight. In order for Stockspot clients to track their performance, keep tabs on dividends, and run tax reports they’ve chosen to partner with us. Sharesight is the interface that Stockspot relies on to convey mission-critical information to their clients.

stockspot2.jpg

Chris and his team had a look at some old-school portfolio administration providers and determined that Sharesight provided better functionality and a more intuitive interface. Furthermore, Sharesight adds a bit of extra value for his clients. With Sharesight, even though we’ve white-labelled a dedicated version for Stockspot portfolios, his clients can open a Sharesight account. This way they can view their Stockspot holdings alongside their other portfolios. This provides one view onto all their holdings, which is really handy, especially come tax time.

You’re reading our blog, so you already know how we rant and rave about online “life admin.” It’s 2014. We expect everything to be accomplished online. Investing, travel booking, taxes, taxi hire, you name it. Stockspot and Sharesight manage to do two important things at once: provide a cost-effective way to invest and a fully-online experience.

Is Investing Getting Cheaper?

Probably. The May 3rd edition of The Economist sheds some light on a topic we spend a lot of time thinking about at Sharesight: the fixed costs of investing. Their cover teased the topic with the words “Death of the fund manager,” but they wouldn’t be The Economist without eye-catching headlines and witty captions.

Is Investing Getting Cheaper?

No one is dying, that’s an overstatement. Last time we craned our necks at the Perpetual skyscraper in Sydney it seemed like they were still paying the window washers. The briefing “Will invest for food,” was a terrific look at how passive, low-cost investment options are putting the squeeze on more expensive, active fund managers. People in workforces worldwide (or their employers or governments) are demanding lower fees for their investments, particularly for pensions. Now, we love active managers who earn their fees, but there are too many sub-par managers charging too much money to people who have no idea what they’re paying for.

We’ll let you read the article yourselves, but they covered an especially fascinating topic: the psychology behind the price it takes to invest. Because returns on investments (particularly in funds) aren’t seen for years, the low-cost options aren’t the most popular. If commissions paid to advisers are baked into the net return, investors feel like they’re getting something for free, which they prefer to paying even a tiny, up-front fixed fee.

Furthermore, well-heeled investors tend to think that an expensive manager must be exclusive, and therefore, worth it. That’s bananas. Warren Buffett didn’t earn the moniker “Oracle of Omaha” by picking expensive stocks. Bernie Madoff was exclusive. Part of his con was turning people away from his fund to preserve an aura of exclusivity. How’d that turn out?

The Economist touched on the passive versus active debate too. This merits a separate blog post, but we believe most people have room for indexing in their portfolios. Especially folks who don’t have proper investment training, don’t have time to research, or are especially risk-averse. We love picking stocks, but it (should) take time and know-how.

We wish the briefing took one step further. They hinted at the topic by mentioning the changes in the music and book industry…

If the price of active management is being forced downwards, won’t this force active managers to seek larger customer bases? How will they sell their funds to us, the retail investors? Our hope is the downward pricing pressure on active managers spurs the creation of investment marketplaces. An “app store,” of options. We love high quality active managers with conviction. A marketplace would hopefully highlight the best active managers and allow investors to make like comparisons of fees and returns data alongside the index trackers.

At Sharesight, we provide a product that’s about letting you control your portfolio data. We’re passionate about the idea that you own your investment data and can tap into a marketplace of best-of-breed apps. Aggregation, access, and portability. After all, we want to invest in everything that professionals have access to.

Investing will always introduce the unknown. The only certainty is that it will cost you something to do it and to keep track of it. So why not control what you can?

Oh, and as good as The Economist is at headlines and captions, we’ve yet to see one better than the New York Post.

How Do I Track My KiwiSaver Fund in Sharesight?

On Valentine’s Day this year, we launched managed funds data on Sharesight. It was our romantic overture to add more value to your Sharesight login. Sweet, right? For two months now, our clients have been tracking fund prices and distributions on a daily basis. We count over 10,000 New Zealand and Australian managed funds on our database.

sharesight-kiwisaver

Since then, we’ve gathered heaps of client feedback. Remember, the best way to see the features built that you want is simply to ask. Tweet us. Facebook usPost to our client forum. Or write a comment below. It seems that one of the most popular use cases is for folks to simply track down the specific KiwiSaver fund that they own. Those quarterly paper statements don’t seem to cut the mustard. To find your fund, you’ll want to add a new holding to your portfolio and make sure the “Market” dropdown is set to “Funds NZ”

Within the “Code or Company Name” field, begin typing the name of your KiwiSaver fund. Make sure to type this exactly as it appears on your statement. It’s a good idea to type slowly – with thousands of funds on our database our auto-prompt box takes a second to load suggestions. Or if you have the fund code begin entering that in the box, again slowly, so our system has a chance to auto-suggest your fund. Remember, many KiwiSaver funds have very similar names. If you don’t see your fund straightaway keep typing, it should appear as the name gets more specific.

Once you’ve found your fund, you’re ready to add your transactions or opening balance. By default, Sharesight asks you to record a buy transaction. Check your paper statement. If you see how many units/shares of the fund you own, and the date on which they were purchased, enter those in the “Traded On” and “Quantity” fields. Sharesight knows the price of the fund at the close of trading on every day going back in time. To confirm the price, click the price that populates under the “Unit Price” box.

If you don’t see details about number of shares or units on your statement, no worries. You can click the option to begin with an “Opening Balance” instead. Enter your “Cost Base” (your fund balance) and considering you don’t know the number of units (“Quantity”), you can determine this on your own. Typically, we match quantity to cost base so that the average cost per share = $1.

You probably didn’t pay any fees (or shouldn’t have!) so you can leave that field at $0. Click “Save this Holding” and now your KiwiSaver fund is part of your Sharesight portfolio and will be tracked alongside your other holdings. You can do everything that you’re used to doing, like run a Performance Report.

Funds and shares playing nicely together

If you’re making regular contributions to your KiwiSaver fund, it’s important to understand that Sharesight won’t know when this money is taken out of your pay. Therefore, we can’t update your balance on an on-going basis like we do for shares. Since KiwiSaver funds are designed to be long-term, buy and hold investments, our encouragement is to update your KiwiSaver balance every month or quarter. This should suit investors of nearly all stripes.

To do so, simply go into your KiwiSaver fund from Portfolio Overview. Within the “All Trades & Adjustments” section click “Enter a new Trade or Adjustment” to update your holding balance or enter a new transaction.

Happy investing and keep the feedback coming!