How they operate

At their core, micro-investing apps all market themselves as platforms designed to lower the entry bar for investors. Beyond that there are plenty of differences, though, starting with the assets that are available.

Raiz gives its users the option of investing in themed portfolios (for example, aggressive or socially responsible), which are made up of different ETFs; Blossom offers a single fund composed of government bonds, cash and mortgage securities; and Spaceship’s portfolios invest directly in various listed companies.

Then there’s the investing process, which is relatively seamless. For most platforms it’s as simple as signing up

Another is round-ups, which work by rounding up every transaction made with a linked bank account to the nearest $1 or $5, then transferring the difference to the app, where the money is pooled and then invested once it reaches a certain amount (for example, $10).

Raiz even offers a unique feature whereby users can spend with participating brands and have a percentage of each transaction directed into their investment portfolio as cashback.

The relative ease with which micro investors can invest their money comes with a price tag, though.

Costs vary across platforms, but most will charge either a one-off transaction or brokerage fee for every trade, or a

“Honestly, it’s great if these apps get younger people interested in investing, especially if they can get in young and take advantage of the power of compounding,” she says.

“I think people often start using these micro-investing apps as a side investment for their spare change, almost like a savings account. But these aren’t savings accounts – they are an investment that comes with risk.”

Beyond being realistic about the risk, Lusher also suggests that investors who have built up a decent amount of money through micro-investing may want to step back at some point and consider their long-term strategy.

“It might not matter too much if there’s not a lot of money in there, but once that