For a lot of you, like me, baskets and bundles were kind of a love at first sight thing in your investment journey. I know this because I've seen the numbers.
Since we launched baskets just over a year ago we've seen over 2000 of you add them to your EasyEquities ZAR and Tax Free Savings accounts. That's a lot. But not nearly enough, when I think about the insane benefits they offer investors. That's why you'll be hearing about baskets and bundles from me a lot more. Starting with some basics on what these benefits are, and what makes them different to each other. No one breaks this down better than our innovation extrodinaire and EasyEquities CEO Charles Savage. Here's why he reckons baskets and bundles are the business:
Baskets are appropriate for the more hands-on investor who still actively wants to participate in their share investing decision making but also wants to leverage off the collective smarts of the community and experts.
Basket publishers essentially reduce the universe of available shares and ETFs down to a small list of shares. This could be thematic (think financial stocks or biotec stocks) or investment style based (think value or momentum) or simpy the publisher's TOP stock picks. Another cool thing about baskets is that you get to take stocks out if you don’t like them and the basket will automatically reweight to take account of the stocks removed.
A good way to think about baskets is that essentially you are the co-pilot to your investments. You get to sit alongside the pilot, learn from their every move and from time to time take up the controls.
With Bundles you get to be a first-class passenger, with a full view of the cockpit. You learn from the pilot's every move, as you sit back, relax and enjoy the view.
Bundles are similar to baskets with these differences..
- You don’t get to take shares out, but you can exclude shares if you add them to your exclusion list.
- Bundle managers operate under an asset management mandate as it’s a managed product and therefore you need to digitally sign this before purchase.
- Bundles rebalance and when they do the bundles that you have purchased rebalance too. So, you’re always tracking the portfolio without having to lift a finger.
There's nowhere else you're going to get such affordable access to a investment portfolio created by an asset manager, or otherwise. But both basket and bundles carry a small additional fee, which goes to their creators.
These are slightly higher on bundles because they are continuously managed. These costs are detailed and published pre-purchase for you to clearly see.
Baskets and Bundles Guru
Catch me on Twitter @Leon_WayWay