The US share markets are huge. With Hatch, you can invest in over 2,900 companies and over 900 exchange-traded funds, which is still less than the NASDAQ's total listings (over 3,800)!
One of the biggest fears we've heard from new investors is that they'll make the wrong decision. Spoiler alert, you will. We all do. Investing isn't about getting it right all the time, it's just about your money increasing in value overall. Fun fact: Experts who make a living from identifying the next big thing and buying shares in it early, plan to get it right 1-2 times out of 10. Every day investors join the party a little later, so the risk/reward ratio changes a bit, but you get the point. If you buy shares in a handful of companies, they don't all have to increase in value for you to wind up better off.
However, with so many companies and funds to choose from, we understand that choosing those first few investments can feel daunting. Here's some simple ways to narrow down the list and make a start.
Option 1: Start with brands you know and love
Start with products and services you know and love. Are you a Coke fanatic? Lululemon lover? Does your work day start on Slack or Zoom? Is your laptop from Microsoft or Apple? Do you spend too much time on Facebook/Instagram, Tinder, Netflix and Amazon Prime? Will you only ever wear Nikes? Did you race out to try Beyond Meat burgers? You get it. You know what you love and you know where you choose to spend your hard earned money. Browse Hatch and add some of those brands to your watchlist.
You've now reduced 2,900 companies down to a handful. Phew. Take a breath. But don't stop there, because it's research time! Don't worry, it doesn't have to mean analysing financial analysis and annual reports, there's a lot of different ways you can find out whether it's a good idea to become a shareholder in a company. Here' some common approaches we hear from Hatch investors:
- Google is your friend. Simply type in 'should I buy [company name here] shares' and behold! A wall of opinions. Should you blindly follow one of them? Of course not. But when you read a few, you may notice some common themes. They'll help you get an idea of what analysts are thinking and you'll probably go down a few rabbit holes that'll teach you a thing or two along the way.
- Pay attention to social trends. Look around you. Are you the only one obsessed online shopping, or does it seem like it's taking over the world? Talking of taking over the world... Noticed a few electric vehicle charging stations cropping up around the place? Whats the most popular video call software appearing in your calendar invites? Are any of the companies on your watchlist taking advantage of the trends you've identified? How do you think it will impact the value of those companies in the future?
- Use your networks! After you make your first deposit into Hatch, you'll get an invite to join Hatch's exclusive online community. Kiwis with a range of investing experience share their top tips and investing strategies, and questions are welcome! But don't stop there. Trust us, you already know people who would love a free coffee in exchange for sharing their share market smarts. Or get a group together and just start chatting about the companies you're watching. Chuck in a bottle of wine or a nice dinner and you'll be surprised to discover a new hobby.
- Get excited about Investor centres! Every company that allows you to buy shares through the share markets has to have a place where investors can get info (we link to each company's investor centre when you click on it in Hatch). Sound boring? It's not. For example, check out the Investor Relations section of Apple's website - it's a wealth of interesting information, updates and news about the company. Obviously, not all investor centres are quite as beautiful, but the information they give you is just as helpful.
Option 2: Follow the experts
It's important to realise that no one (and we mean no one) always gets it right when it comes to shares. Even the experts can't predict global pandemics, hurricanes and surprise election winners and these all impact the share markets. However, the experts can provide a great place to start. One of the most famous investors in the world is Warren Buffet. The brains behind Berkshire Hathaway (a company that was formed purely to invest in other companies), gives new investors 3 shortcuts to starting:
- Buy shares in the VOO S&P 500 fund. Buffet may have made a fortune hand-selecting companies to invest in, but he regularly recommends everyday investors avoid doing the same. There's a range of articles online that dissect his stance, but it basically boils down to this: buying shares in the VOO S&P 500 fund means buying a slice of the 500 biggest public companies in the US. It's low cost, low fuss and has grown investor's money by an average of 8% a year. Much better than a savings account! No idea how funds work? Get the downlow on funds here.
- Buy shares in Berkshire Hathaway. Through Hatch you can buy Class A shares and Class B shares in Buffet's business (see the difference between A and B class shares here). If you buy shares in Berkshire, you're buying a slice of the companies he uses his unique experience and opportunities to invest in. If you back the Oracle of Omaha (as he is known in investing circles), you can sit back and let him and his team of gurus do the choosing for you.
- Look at what Buffet's investing in. If you want to treat Buffet's expertise as more of a guideline, a quick Google will help you see the companies Berkshire Hathaway owns shares in. You can add them to your watchlist and do your own research to see which ones are worthy of investing your hard earned money into!
Ways to explore investment options in Hatch
We've tried to make browsing shares easier by allowing you to slice and dice them in a few ways.
Search by Megatrends
Check out companies and exchange-traded funds at the forefront of future-focused trends, starting with Green, Female, Cannabis and Tech.
Search By Industry
Want to invest in Healthcare, Transportation or Energy industries? Check out companies in those industries and see who is doing interesting work!
Filter shares based on certain criteria
You can filter shares by investment type, whether or not they pay dividends, and total market cap to find something that fits your portfolio.
Check out the biggest movers and shakers
Along with your classic sort options, you can also sort shares based on what's being traded the most on Hatch, who has the biggest gains and losses today, or who is paying the highest dividends.