When research shows that Brits would rather jump out of a plane or change careers than commit to a long-term investment, then it's time for the investing world to have a rethink.
So in a bid to address this and open up investing to a wider audience, Investec Wealth & Investment have launched Click & Invest, billed as a straightforward online investment service for those with £10,000 or more to invest, and designed for consumers with all levels of investment experience, including "financially cautious Brits".
To mark the launch, Investec devised a pop-up Click and Investaurant in London. A new concept in dining, the menu has been created and chosen based on an individual’s appetite for risk, with crickets, crocodile and rabbit among the delicacies on offer.
With TraderLife kindly invited along to test out the risk-based restaurant concept, we thought we’d send along an undercover CTA to put the management team through their paces and give them a good grilling (pun intended). Read on to find out his thoughts on the investment offering and just what Click & Invest served up…
I’ve always had a personal bugbear with traditional IFA propositions. Despite access to superb training and advice, IFAs typically have their hands tied through incentives to offer specific products and portfolios, limiting the amount of portfolio options they will typically present to clients.
This is a difficult position to be in with limited volatility and the fragility of the economic system making performance difficult to come by.
In addition, most portfolio theory hasn’t evolved much in recent years, so seemingly uncorrelated portfolios can actually start to look very similar as conditions and correlations change. This results in most investment portfolios on offer looking extremely similar, with the only difference being the providers used.
This has created an opportunity for ‘robo advice’ to enter the market. I generally like the idea of automation in this space. For me, it allows IFAs to focus on bespoke solutions for more specific needs, while reducing the cost of a standard portfolio. If a ‘robo advice’ offering is cheap, simple, easy to use (but complex enough to add value) and can offer access to a wide range of providers and portfolio options, I believe there is definitely a space that this kind of offering can fill.
However, in the UK, no-one is really offering proper ‘robo advice’ – there are hybrid models, but no fully systematic options.
I personally keep a small investment portfolio with Hargraves Lansdown, who operate a simple enough platform and offer a wide range of investments. However, I do find their simplified risk-based investment portfolios rather limited. They seem to be focused on “favourite” single name managers rather than maximising value to clients – and I also think their offering is rather lacking when it comes to understanding clients as individuals. It relies on you knowing your risk profile – and most people don’t.
With this in mind, I was very interested to hear about Click & Invest and get to know their product and what they are offering, so I took the opportunity to attend the event (at London's Dead Doll’s House) and test out my appetite for risk.
Firstly, I was sent a list of risk-based questions to answer, which would tell me my risk profile and use this to select a bespoke evening meal. A clever idea and premise.
Given that I run a systematic fund and have grown a number of companies from the ground up, my bet was on a risk profile on the higher end of the spectrum. I was a little surprised to find that I came out with a moderate appetite towards risk – happy to take risk, but only when it is extremely calculated. On reflection, that made a lot of sense – and I ended up with a rather tasty rabbit and langoustine dish, complete with specially selected complementary wine.
Over dinner, I signed up to investigate their offering in a little more detail, starting with a list of questions designed to help me build a bespoke portfolio (similar to the list that dictated my menu choice for the evening – although thankfully a little more in depth!)
I found their system to be very easy to use, and the questions probing enough to give a meaningful insight while still being easy enough for consumers with a wide range of investment experience to understand. Once I’d answered the questions, the system built me a bespoke portfolio – interestingly, my appetite for investment risk also came out as moderate.
Having set up my portfolio, I took the opportunity to speak to the CEO Jane Warren and COO Stewart Teague about their product and how they ensure the portfolios offers are useful and relevant. I found that Click & Invest has taken an interesting approach here – utilising investment portfolios and products from the wider Investec group, normally reserved for the wealthy investment elite.
This means all the portfolios have been created bespoke for high net worth clients. For me personally, my profile seemed a good mix (if a little heavy on UK equities for my personal choice) and a far better selection and more well-considered portfolio than I was expecting from a ‘robo advice’ offering.
Stewart was quick to emphasise that their product is less aimed at targeting huge returns, and more on helping people save “that little bit more” and generating interest in investing from a new audience, in particular younger investors and more risk-averse customers. It’s clear that they’ve built a solid product to deliver that goal, and their focus on the customer will serve them well here.
Will it outperform others in terms of performance? Time will tell, but personally I don’t see this moving far ahead of the general pack. But the value of this product is not just in the returns, but in offering access to a strong product by a top investment team, that will make investing that little bit easier.
Having put my most challenging questions to the management, I came away from the event confident that the team have really taken time to consider where they can compete in a busy market and how to build a customer-focused product. Given what I have seen from the competition, I think Click & Invest has the potential to be a very strong contender in this market.
As a testament to this, I have invested my own money to test the product out further (which is rare for me) and would happily recommend it to friends and family. There is a £10,000 minimum investment and a requirement to invest £100 per month – but I firmly believe that even with a large portfolio this is a very good offering, and I definitely wouldn’t limit this to the smaller investment scale.
All in all, I left having enjoyed a good meal and with an exciting new investment opportunity to try out – a success in my book and I look forward to seeing how Click & Invest develops...