Spaceship launches US investing service: Is it worth the switch?
The Australian app enters the US investment space with zero brokerage fees.
With technology and finance intersecting more than ever, investing in US stocks from Australia has become a straightforward process.
All it requires is signing up with a broker that provides access to Wall Street, and for many, the most convenient and cost-effective route has been through online share trading platforms.
Australian investment app Spaceship is now among these platforms, offering a new service to give Australian traders access to US markets.
But with numerous platforms vying for investors' attention, the critical question arises: is Spaceship the right platform for your US investing journey?
The rise of online investing: reasons to invest in US shares
Investing in US shares offers Australians a gateway to the world's leading companies and sectors, significantly diversifying their portfolio beyond the local market. The US stock market's size and liquidity provide unique growth opportunities, especially in tech and innovation-driven sectors.
Despite a strong local market engagement, only 16% of Australian investors hold international shares according to ASX's Australian Investor Study 2023.
The report found the main challenges were limited knowledge, uncertainty about reliable information sources, difficulty in identifying overseas investment opportunities and selecting an appropriate trading platform for international markets.
Spaceship has been a player in the Australian investment landscape, primarily through its two flagship products: Spaceship Voyager, a robo-advice wealth management fund designed for easy investing, and Spaceship Super, a superannuation fund aimed at forward-thinking investors.
Now, Spaceship's new US Investing service enters the arena with features aimed at helping both seasoned and novice investors.
But, with platforms such as eToro and IG already giving Australians access to US markets, finding the right broker that aligns with your investment goals is crucial.
Understanding Spaceship's US investing service
Spaceship's US Investing service offers several key features, including:
- Low minimum Investment: Start with as little as $10.
- Competitive fees: Enjoy low monthly fees starting at an additional $2 monthly fee for existing Spaceship Voyager customers ( $4 / month otherwise).
- No brokerage fees: Trade without the worry of additional costs.
- Access to popular ETFs and shares: Get into sought-after US stocks and ETFs from major providers by using Aussie dollars. It even lets you invest in fractional stocks.
Note: Fractional share trading is where you can purchase fractions of shares, rather than whole shares. For instance, you could buy one-tenth of CBA stock for $10 rather than 1 stock for $100.
Andrew Moore, CEO at Spaceship, said:
"It was important for us to stay true to our core values of accessibility and transparency. With our user-friendly platform, low investment threshold, and simple and affordable fee structure, we believe we've done just that," he said.
"We are making accessing the US market easier than ever before, while also encouraging healthy, long-term investing behaviours for our customers."
Context and comparison
When compared to other platforms like eToro, which offers a wide range of international stocks but with variable fees, or IG, known for its comprehensive trading tools but potentially higher cost structure, how does Spaceship perform?
Positives:
- Fees: Spaceship offers a competitive fee model. In comparison, eToro charges a $5 withdrawal fee and a conversion fee for AUD to USD transactions, while IG's fees include a $15 monthly inactivity fee after two years and brokerage fees starting at $8 per trade for US stocks.
- Investment minimums: Spaceship's $10 minimum investment is significantly lower than eToro's $50 minimum for US stocks. Although, IG has a $0 minimum deposit with higher trade size requirements.
- Brokerage fees: Spaceship eliminates brokerage fees, setting it apart from IG, which charges $8 per trade for US stocks, and eToro, which, while not charging a commission, incorporates fees into spreads.
Negatives:
While Spaceship's US Investing service offers distinct advantages in terms of fees and minimum investment requirements, it's important to note its limitations.
Spaceship does not provide access to global and ASX stocks, CFDs, forex (CFDs), and cryptocurrencies (CFDs), which are available on platforms such as eToro and IG.
This makes Spaceship less suitable for investors looking for a broad range of investment options, including leveraged trading and wider international market access.
Is Spaceship the right platform for you?
Choosing the right investment platform depends on your investment style, goals and preferences about fees, user experience and available securities.
Spaceship's US Investing service is particularly appealing for those looking for an easy and affordable way to start investing in US stocks. But at the same time, consider the limitations.
Looking for a low-cost online broker to invest in the stock market? Compare share trading platforms to start investing in stocks and ETFs.
