Spaceship Voyager: How does the investment app work?

More than 150,000 Australians are using Spaceship Voyager, the micro-investing app that allows users to get into the share market with their chump change. We take a closer look at the app and ask a financial adviser for his advice for would-be investors.

In this article:

• What is Spaceship Voyager?
• How does Spaceship Voyager work?
• How much does Spaceship Voyager cost?
• Pros and cons
• What does a financial adviser think?

What is Spaceship Voyager?

Spaceship Voyager sits alongside a lineup of micro-investing platforms in Australia, such as Raiz and CommSec Pocket. These platforms allow users to start investing with small amounts of money.

Spaceship Voyager does not have a minimum investment amount. Through the app, users can invest in one of three diversified portfolios and then track investment performance. Users can either invest lump sum amounts, or set up a regular investment plan to invest on a weekly, fortnightly or monthly basis.

How does Spaceship Voyager work?

Spaceship Voyager offers three portfolios, which offer a mix of shares in Australian companies, shares in international companies and cash investments.

Spaceship Universe Portfolio

The Universe portfolio invests in companies that Spaceship deems to be “world-changing”. There are between 70 to 100 companies in the fund, including the likes of Spotify, Microsoft, Apple and Tesla.

The fund’s assets are typically invested within the following asset allocation ranges:

• 70-80% companies listed on international stock exchanges,
• 15-25% Australian listed companies and
• 0-10% cash.

Spaceship Origin Portfolio

The Origin portfolio invests in some of the world’s largest companies. There are 200 companies in the fund, including international brands such as Apple and Amazon.

The fund’s asset allocation is typically:

• 70-80% companies listed on international stock exchanges,
• 15-25% Australian listed companies and
• 0-10% cash.

Spaceship Earth Portfolio

Lastly, the Earth portfolio invests in companies that Spaceship say “have a positive impact on people and the planet”. This includes investing in areas such as the environment, quality education and companies that fight poverty, inequality and climate change. There are between 30 to 50 companies in the fund, including Microsoft, Ninetendo and Starbucks. This portfolio does not invest in companies involved in fossil fuels, controversial weapons, animal cruelty, human rights abuse, tobacco, alcohol, gambling, firearms and conventional weapons, and nuclear power.

The fund’s asset allocation is typically:

• 85-100% companies listed on Australian and international stock exchanges and
• 0-15% cash.

How much does Spaceship Voyager cost?

Spaceship Voyager currently has no entry fees, no exit fees and no brokerage fees. The platform is fee-free for the first $5,000 invested. However, for balances above $5,000, it charges:

• Spaceship Universe Portfolio: 0.10% p.a.
• Spaceship Origin Portfolio: 0.05% p.a.
• Spaceship Earth Portfolio: 0.10% p.a.

If your balance was $10,000 for a year, this means you would pay $2.50 or $5.00 in fees for the year (depending on your portfolio).

Pros and cons

So should you download Spaceship Voyager? We’ve taken a look at the product, and suggest some of the potential pros and cons to consider:

Pros

• No fees on low investment amounts – you’ll only be charged if you invest over $5,000.
• Easy to use – the platform is designed to allow you to easily invest and track your investments.
• Invest small amounts – there’s no minimum investment amount.
• You can set-and-forget – you can set up regular payments to invest on a weekly, fortnightly or monthly basis.

Cons

• Fees kick in on higher amounts – if you have over $5,000 invested, you will be charged fees and this will be a proportion of your balance. So it’s worth considering the fees if you are investing a higher amount.
• Risk – this includes market risk (the share market can go up and down), currency risk (movements in exchange rates can impact your investments) and concentration risk (if your assets are concentrated in a single asset class).
• Limited choice – Spaceship only offers three portfolios to choose from.

What does a financial adviser think?

Independent financial adviser Kyle Frost said the main appeal of micro-investing apps is how easy they are to use.

“There’s a lot of analysis paralysis out there to the point that people find ETFs and online brokers too confusing,” he said.

To this end, micro-investing apps can be a good first step into investing. However, if you are investing larger amounts, Mr Frost recommended comparing your options and looking into ETFs.

It’s also important to remember that investing is a long-term game. Spaceship itself recommends that its customers hold their investments for at least seven years.

For this reason, Mr Frost also cautioned against using micro-investing apps as replacements to savings accounts for short-term goals.

“If you have the goal of buying a first home or going on holiday or buying a car, in that situation you may want the stability of a savings account,” Mr Frost said.

“(Microinvesting apps) don’t feel like the share market because they are so easy (to use) but there are still risks and they aren’t thought about as much as I would encourage.”

Cover image source: KeyFame/Shutterstock.com