Digital platforms are changing the way people invest

Ben Lewis​ wants to sell his house and put the proceeds into his investment portfolio on digital investment platform Hatch.

The 45-year-old Auckland investor already has a $100,000 return in his Hatch account and is selling a rental property to double down on his investments in the platform.

Online investment platform such as Hatch, Sharesies and Stake, allow investors to put money in the sharemarket. Investors can buy part-shares of companies on local and international stock exchanges with as little as 1 cent, plus the cost of transaction.

Lewis​ started his Hatch account in late 2018 and has ridden a bull market rise largely buying shares in semiconductor companies, AI and Tesla.

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While some experts are predicting a slow down of capital markets this year, that is a prospect that does not spook Lewis​.

“A drop in markets wouldn’t change my behaviour at all. In fact, it would encourage me to put more money in,” Lewis​ says.

Lewis​ says he gets most of his investment advice from social media. While he knows most professionals would baulk at the idea, the method has worked for him so far, he says.

“I know a lot of people in the industry would laugh to hear that you got your investment leads from social media, but there are a lot of smart people that I trust in the Hatch investor Facebook Group.”​

Last year Financial Markets Authority research found investor behaviour was changing largely due to easy-access digital investments.

The research showed 31 per cent of all online DIY investors jumped into an investment in the last two years because they did not want to miss out.

And 27 per cent invested based on a recommendation from someone without doing their own research.

With a strong bull market largely rewarding these behaviours with positive returns, some experts are concerned people may be learning bad investing habits.

Simran Kaur​​, one half of the investment podcast Girls That Invest, says the bull market run has not taught people much in the way of differentiating between good and bad investments.

“In the last two years … even if you brought any old company, it is likely it would have increased in value especially in the US,” she says. “But that is not the normal case.

Kaur​ is concerned that the bull market may have given some investors false confidence…