Sharesies' new move gives members direct exposure to the largest 500 US-listed companies across all sectors. File photo. Photo: 123RF
Sharesies is offering its KiwiSaver members the opportunity to invest in individual US stocks, or via a new US500 fund - but there's a warning they need to take care doing their own stock-picking for their retirement savings.
Sharesies is launching a US500 fund with direct exposure to the Vanguard S&P500 ETF which includes the largest 500 US-listed companies across all sectors.
Sharesies KiwiSaver members will also be able to choose to invest in a range of individual US stocks including Meta and Apple.
There is a 5 percent limit on investing in a single stock via KiwiSaver and at least 50 percent of the investor's portfolio needs to be in base funds.
About 44 percent of Sharesies' KiwiSaver scheme members have some form of self-selected investment.
Sharesies KiwiSaver also allows members to choose to split contributions across multiple base funds.
Co-chief executive Leighton Roberts said about 10 percent of investment volume was member-selected investments.
But he said there would probably be strong demand for US stocks and the ETF option.
Few investors would be near Sharesies' guardrails, he said. "We think we'll get something like 20 percent of volume being self-selected."
Greg Bunkall, data director at Morningstar, said self-selected investments would have a wider dispersal of outcomes than those managed by a fund manager.
Sorted personal finance lead Tom Hartmann said using fund managers was a way to diversify and spread risk across various industries and locations.
"As we instead get more options to pick shares ourselves for our KiwiSaver, it's important to not end up with all our eggs in the same basket. There need to be guardrails in place to keep people from risking too much and tying their fates to specific companies without realising."
Roberts said it would not necessarily suit every investor but there was a lot of demand. "KiwiSaver is a decision for people - a bit more consideration goes into it than signing up and putting $100 in to something."