Sooner or later, every industry gets disrupted by advances in technology; think the TV stations and Netflix, taxi companies and Uber, hotels and Airbnb. And while online trading platforms have been around for quite a while, stockbrokers are now being taken on an even-cheaper platform called Superhero.
In fact, Superhero that boasts that it’s the country’s cheapest broker, by charging no brokerage fees on all trades of exchange-traded funds (ETFs) and a flat $5 fee on trades of all ASX-listed shares, with a minimum trade size of just $100. (Superhero also offers access to Australian-listed real estate investment trusts (Reits) and listed investment companies (LICs).)
How does Superhero offer fees of $5 or less on trades, when online brokers typically start their fees at around $20 per trade and full-service brokerages that offer advice typically charge a percentage that varies depending on the size of the trade?
In the most basic terms, Superhero makes trading more affordable by ensuring all of its users operate under the same holder identification number (HIN), rather than attaching individual HINs to each user. That allows Superhero to pay lower settlement fees, with the savings passed on to users.
For example, comparison site Finder says that Superhero’s $5 brokerage fee is half the lowest fee offered by super-popular online broker CommSec, and that while online brokers OpenTrader and IG offer fees as low as $5 on Australian stocks, their fees are tiered so require a certain volume or value of trades to be hit.
Finder also notes that the $100 minimum trade size is particularly low, given that $500 is the norm required of investors trading Australian-listed stocks.
All Superhero users can track their portfolio by using a digital ‘wallet’ attached to their account that shows cashflow through the account.
But traders who want to use more advanced trading functions than are available on a basic Superhero account, such as price limit orders, can trial Superhero Live, a beefed-up version of Superhero, at no cost for 30 days before paying a $9-a-month subscription fee.
The other key difference between Superhero Live and Superhero is that the subscription-based Live platform offers more comprehensive portfolio performance reports and real-time pricing and data, while the basic Superhero shows 20-minute delayed pricing and data and offers more basic performance reports.
A trading account with Superhero can be opened online and the company promises that it will have the functionality to transfer existing holdings to its platform. (It’s also working on an app, which it expects to launch soon.)
Using Superhero is relatively simple too, in that money transfers can be made to the Superhero ‘wallet’ using BPAY or PayID. There are no fees attached to holding a Superhero wallet, nor does Superhero pay interest on cash held in the wallet.
While Superhero only launched in September, it’s backed by some big names in innovation in the financial services sector; Nick Molnar, who launched Afterpay, the buy now, pay later platform, and Larry Diamond, founder of Zip Co, another buy now, pay later provider.
Superhero partners with Sanlam Private Wealth, a Sydney-based wealth manager that supports innovative Aussie financial services providers, including online investment adviser Stockspot, real-time trading platform Stake and stock research provider Maqro Capital. Superhero operates under Sanlam’s Australian Financial Services Licence, of which it’s an authorised representative. Superhero offers a financial services guide to anyone interested in checking out the way it operates and explains in its online FAQs how shares are purchased and held by the platform.
Finder’s expert Kylie Purcell reviewed Superhero to see how it stacked up against other online brokerages, and decided that its user-friendly layout and low minimum investment suited new investors or those who wanted less advanced trading features.
“For anyone that is after a straightforward platform to get the job done without all the fuss, it’s certainly an appealing option,” she found.
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