Unbiased Easy Equities review

Piggy bank

I’ve wanted to do an Easy Equities review for a while now since they won the Intellidex Top Stockbroker award. When I started investing, I knew about Easy Equities and their affordable offering, but I still chose to go with a trading platform offered by a bank. It is strange how the mind works sometimes. I did not trust any platforms not associated with a bank. In the back of my mind, I always knew that there was a cheaper option though. Every month when that platform fee went off, I cringed a little.

At the start of 2018, I went on a cost-cutting mission. My own, personal fees must fall campaign. When the announcement was made that we could move our Tax-Free Savings Accounts (TFSA), I started shopping around. Easy Equities stood out since they had no platform fee and trading costs were only 0.25%, with no minimum fee. I did not find any good reviews and did not move until July as a result of a recommendation by the Fat Wallet Team.

Ease of use

Registering the account was easy. Loading the documents was intuitive and I was FICA’d within two days. That was on me though, there was an error in my address (Shit happens). Navigating the platform is straight forward, with the slider at the top allowing you to page between accounts. One of my friends helped with the website (If you ever read this bud, well done).

Of the bat, you get 5 accounts. The first two are demo accounts in ZAR and USD. You also get regular trading accounts in ZAR and USD and finally a TFSA. You pay into them individually by specifying the account number as a reference number during the Electronic Fund Transfer (EFT). If you made a mistake you can always transfer between accounts. Just keep your annual TFSA limit in mind when doing this. At this stage, I use the ZAR trading account and the TFSA.

In the ZAR account, you can buy any South African shares or Exchange Traded Funds (ETFs). You do not get to specify the price at which you buy, as with most other platforms. Instead, you will pay the spread when you buy shares. However, when you buy ETFs in you Easy Equities account, the spread is managed by the market maker, if you buy between 09:30 and 16:30.

As a result, I mainly buy ETFs on Easy Equities. The negative reviews on their platform mainly stem from the massive spread that is sometimes paid on shares with low liquidity. Larger shares with good trading volumes, like top 40 shares, will also have decent spreads.

Additional features

One of the stunning things about their platform is that you can buy fractional shares. This means that you can invest microscopic amounts and the associated costs are still minimal because there is no minimum fee. This is great for investors just starting out or if you don’t have massive piles of cash to invest at once.

They offer a Retirement Annuity (RA) as well at a fixed fee of 1%. This is not expensive, but you can do better in South Africa. Again, I’m not a big fan of RAs for the main reason that it does not allow me to retire earlier than 55. You can read more on this in my article why I don’t invest in retirement annuities.

The next innovative feature is its thrive initiative. This rewards you for completing simple tasks like doing an ETF quiz or buying certain share packages. Obviously, they are going to make it worth their while by including tasks like inviting new investors to open an account with them. However, what you get for your effort is no fee transactions on certain shares and ETFs. Sounds fair to me.

On most platforms, you input the amount you want to spend on shares and the fees are then added to this amount to calculate your total investment cost. Easy Equities allows you to specify your final investment costs. This saves you the hassle of iteratively fine-tuning the number of shares you want to buy until your total investment cost equals your available funds. This makes investing even quicker than it already is.

What I would change

They have baskets of shares that you can invest in. At this stage, they have 11 basket options that are invested according to different strategies. My concern is the management strategies of these baskets. If you, for instance, buy a Top 40 share, the index is self-correcting. In other words, if a company’s market cap becomes too small, it falls out of the index. Will these baskets be adjusted if shares are not attractive anymore and who makes this call? I mean there is a Jan Braai basket. Do I trust him with my meat? Definitely. Do I trust him with my retirement money? Fuck no.

Conclusion

I really like the Easy Equities offering and like seeing them do so well. They offer a low-cost platform, perfect for investing in ETFs. When I started out I had a lot of questions regarding Easy Equities and I hope that this article answered some of the questions you might have as well. I don’t earn a single cent for this Easy Equities review, just in case, you thought I am getting a kickback.

Be safe out there,

Hendrik

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Endnote

Thank you for reading to the end. Apparently, the average person spends 8 seconds on a page, so you are special. If you have any suggestions, feel free to drop me a mail on the contact page. If I missed anything or you have questions, don’t hesitate to comment below. I might even notice it and respond. If you enjoyed this article and really want to throw me a bone, please share it.

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Comments

  1. William Goosen

    “You can input any amount you want to spend on shares and then the fees are added to this amount to calculate your total investment cost. It would be nice if they changed this, so you can specify your final investment costs.”

    There is an option under account preferences to choose whether the amount you invest includes or excludes fees. It seems to default to excluding fees.

    1. Post
      Author
      Hendrik Brand

      Thank you for the correction William. I tested it and works like a charm. Looks like they did think of everything. I will update the post accordingly.

  2. Francois

    Thanks for the review Hendrik. I recently opened an account with them and am looking forward to using the platform and hopefully see my investments grow.

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      Author
  3. Warren B

    Morning Captain,

    Is Easy Equities safe (safe as houses), if they go bust do I still have my shares?
    Can I move my Easy Equities $ shares to another platform (i.e. Facbook / Nike etc, move from Easy Equities to ABSA, FNB, Standardbank etc.)

    1. Post
      Author
      Hendrik Brand

      Hey Warren,

      So the local shares are registered in your name with the JSE and you receive a share certificate with each purchase. As you mentioned, it can simply be transferred to another broker if Easy goes bust. So it is as safe as any other broker.

      On the international front, the shares are held by a company called First World Traded if I remember correctly. So they keep track of who owns what but the shares are in their name as far as I understand. Exactly what happens when they go broke, I would have to find out.

  4. Pingback: Nifty finance apps - Tigers on a Golden Leash

  5. Warren B

    Morning Captain,

    Me again, sorry to bother, but could you find out more on Easy Equities international investments ($-shares) “Exactly what happens when they go broke, I would have to find out”.

    If you allow me another question: What would you do with R150k now (if you don’t have any debt), some possible schemes / dreams:
    – Money Market (dream for 7%, hang on for say 6months and see what the rand does);
    – Balanced Funds (currently doing -3.5%, buy it currently cheap);
    – Easy Equities ($ – spread, Starbucks & Facebook & Uber or J&J etc);
    – JSE (be strong and pic a cheap / on massive sale share i.e. Aveng, Sasol, etc);
    – Steve & Kurt (memorabilia);
    – Or hit Emperors (black and red roulette table).

    Humble regards,
    Warren B

  6. Post
    Author
    Hendrik Brand

    Hey Warren,

    So this is what I could find in their documentation, and I quote:

    “All Whole Securities bought on the EasyEquities Platform are protected in an Insolvency Event, because all Whole Securities are segregated (i.e. kept separate) from the assets of FWT and held in safe custody by, and registered in the name of, FWT Nominees. As you are the beneficial owner of such Whole Securities, they do not at any time form part of FWT’s estate.”

    So it looks like you are protected in such an event.

    So, I can tell you what I do with everything I’m putting away at this stage. I make sure I maintain a healthy emergency fund in my home loan and then the rest I put into well-diversified index ETFs (55% international and 45% local). If I did not have a home loan, I would spread it over at least two different bank’s cash accounts and earn about 10% (you can read this article for guidance https://tigersonagoldenleash.co.za/2019/02/22/south-africas-best-savings-interest-rates/).

    I have made and lost thousands on trading individual shares, but I know that just 9% of fund managers outperform the market (for further info read https://tigersonagoldenleash.co.za/2019/05/02/unit-trusts-in-south-africa/). I’m not cocky enough to believe I can consistently do it myself. So I took the passive option.

    As for the memorabilia and gambling, let us know if you have any secrets that we should know about 🙂

    Thank you for reading and the great question.

  7. Warren B

    Gooday Captain,

    Thanks a million for your help and advice (my 3 kids future financial freedom depends on it).

    So just an update on my R150k:

    1 – R10k I extended a portion of paving at my house,
    2 – R130k I invested for my kids in Allan Grey – Money Market (lets hope I can hit the 8%),
    3 – R10k I will buy my wife a diamond bracelet at the Airport in Gaborone (a De Beers diamond with it special mark from the richest diamond mine in the world – Jwaneng Botswana).

    On point 1 and 3 above great investment (happy wife happy life, plus the diamond will grow in value. Interesting assumption: it appears that you can only buy a De Beers diamond with the fancy mark at the Gaborone Airport, other places are based in London, NY etc, but not SA.)

    On point 3, being conservative for now (say the next 6 months).

    Best Regards

    Warren B

  8. Post
    Author
    Hendrik Brand

    Hey Warren,

    Yeah, it is important to strike the balance between living now while saving for the future. I’m glad to hear you made up your mind on your investments. Interesting info on the diamonds and yes, spending time and money on the family is well worth it.

  9. Jefferson

    Very helpfull and informative article and comments also cleared up alot of questions i had. Well written and to the point. Thank you

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      Author
  10. Witbooi

    I opened an EE account in my name. Then I tried to open an account for my CC. In the section for personal details of the authorized person, the only way to enter my birthdate was to click on a dropdown calendar starting with the current date all the way back to your birth date. Now if you are 21, not much of a mission, but if you were born 70 years ago, you will have to click 840 times to get to the day you changed the whole world’s demographics. Won’t you ask your buddy to tweak the EE website, please?

    PS: Failed to open an account for the CC. System errors came up on the EE helpdesk side and the consultant could not resolve the problem.

    1. Post
      Author
      Hendrik Brand

      Hey Witbooi,

      I haven’t tried to open an account in the name of a CC so can’t comment on any errors that can occur. However, if I remember correctly, you just click on the year to start scrolling years instead of months. I’ll check it out again and ask them nicely if I see any issues. Thanks for reading.

  11. Pieter Engelbrecht

    Hi Hendrik

    I have read your article regarding interest rates as well as your opinion regarding African Bank.

    I am currently nearing retirement and want to spread my investments as wide as possible, keeping in mind the tax as well. Surely investing R100 000 IS NOT SO BAD IDEA? Please share your concerns.

  12. Post
    Author
    Hendrik Brand

    Het Pieter,

    Even investing R100 000 I would still spread it between a few cash investments. Tyme Bank and Capitec also offer decent interest rates.

  13. Paulo Silva

    Hi Hendrik. I am an absolute beginner on this topic.
    I recently did a cash investment with Investec ( 7.55% with 90 days notice ) … pretty good i think. Took you advise on the cash investment topic … didn’t diversify and went just with them.
    Now i am looking into ETF’s but i am clueless about how and how much !!
    Just to start playing … !! Is the app intuitive !? Easy to work with !?
    Thank you very much

  14. Thabo Hermanus

    Quite a useful review. I have heard about EASYEQUITIES for some time now and kept not going there as I thought there was a catch. So now that it is 2020, and Sanlam is putting more money into the platform, I am comfortable that they did not overlook something when they bought in that creates regulatory risk (I am not saying Purple would do something dodge), just that it is a second vote of confidence. I gave it a try and was proper impressed seeing as my focus is ETF’s. I was doing my last bit of research before closing on my current online trading platform and transferring to here when I ran into your article. Thanks for clarifying the offshore investment ‘rights’ and the spread factor as I did notice room for error while one gets excited by the cheap brokerage and no monthly fee.

  15. Fanus

    Easy Equities not looking good on” Hello Peter ”
    Did not reply on most of the complaints.

    TRUSTINDEX RATING: 2.6 OUT OF 10 RANKING
    #62 IN FINANCIAL SERVICES

    Easy Equities – Average rating of 1.93 from 41 reviews
    41 TOTAL REVIEWS
    5 Star 8 (20%)
    4 Star 1 (2%)
    3 Star 0 (0%)
    2 Star 3 (7%)
    1 Star 29 (71%)

    https://www.hellopeter.com/easy-equities?page=2

    Any comments?

    1. Post
      Author
      Hendrik Brand

      Hey Fanus,

      Thanks for reading firstly. People generally go on Hellopeter to bitch about companies and not to leave a positive review. I’m also guilty of it. I had a quick look at the ratings for FNB, Standard Bank, Nedbank and Absa. Easy equities has a better rating than all of them. So if I had to comment, I’d say I’m guilty of not rating companies that I have positive experiences with. I agree that they have had growing pains being a relatively new player in the industry, but I like their offering and fees. Any alternative recommendations from your side?

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