Fractional share investing is gaining traction
By Opinion
By Anna Rich
Six-and-a-half years ago, when the Purple Groupâs Easyequities online share investment platform launched, there were 280 000 retail investor accounts on the JSE.
âThis figure provides some context to our growth in retail investors over this period,â says Purple Group chief executive Charles Savage. âAcross the platform, we have 380 000 unique investors who manage 500 000 accounts.â
In general, barriers to investing in equities include the price of shares and the minimum investment amounts required by institutions.
In addition to the option of investing in complete shares, Easyequities offers its own form of fractional share investing. Fractional investing means that those who cannot afford to buy a whole share are now able to invest. This technique is democratising investment, and enables greater diversification.
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Charles Savage - CEO of Purple Group and EasyEquities on results
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Charles Savage on democratising access to investing:
The key was the mission statement and the purpose, which was to democratise access – not the income statement. What we wanted to do was to get mass adoption of investing in shares. We realised that if we did that, we could make a decent amount of money. In order to democratise anything, you have to eliminate the friction points for the entire population.
Accessing a share like Naspers, with wherever it is now – R3,000 a stock – and you’ve only got R100 to invest is a huge friction point. For us, cost was a friction point we needed to address, which we’ve dealt with. But there were lots of other things in the platform capability that we had to stay true to, if we wanted to stand behind our mission statement, which was to democratise it.
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app instead?
CEO Charles Savage goes through the group’s interim results to end February 2021. 08:48
Open:
SIMON BROWN: I’m chatting now with Charles Savage, CEO of Purple Group which owns EasyEquities. Disclaimer upfront: I hold Purple Group shares.Â
Charles, good morning. Interim results out to the end of February. The numbers are a bit boggling in places. Group revenue up a 79.5%. Basic headline earnings 844% up. In truth, it was off a massively low base â but heck, take the numbers anyway.Â
I want to delve into numbers. There’s the EasyEquities pot. Before we get to that, GT247.com, which is your derivative trading platform, [there was] disappointment from them, coming in at a small loss. Is it really a case that you need volatility â that makes trading, that makes a profit?