Young geologist invests for a bright future
James Leaper’s ambition is to invest his way to buying a pub in his beloved Otago. Leaper, 25, is a field geologist working in the dusty area around the small town of Dysart in Queensland, Australia.
He enjoys the work, but says: ‘‘I’d like to come back. I’ve got a lot of family there. It just feels like home.’’
‘‘If all the stars align, I would happily buy a pub in central Otago, and just ride my bike the entire time. It’s a bit romantic, but you have to have something to work towards.’’
To achieve that, he is saving and investing at an impressive rate, though he admits there isn’t that much to spend money on around Dysart.
‘‘There is a lot of nothing, but embracing nothing can be beautiful at the same time.
‘‘Someone recommended me saving 25 per cent of my income,’’ he says, so that’s what he aims for.
He invests through online share investing service Stake, after having started with Sharesies when he began work for a geology consultancy in Dunedin three years ago.
Leaper began by following global mining industry shares, applying his specialist knowledge, but like many younger investors on Stake, and rival platforms Sharesies and Hatch, he focuses on investing in technology companies that are reshaping the future.
He has money invested in companies involved with autonomous vehicle technology, which he expects to change the face of world freight and resources industries. He also invests in makers of advanced micro-chips.
It is high-conviction investing, but Leaper already has to save 9.5 per cent of his income into an Australian super fund, so he is well-diversified.
‘‘Having super sitting there is great, but you can’t access it, unless you are buying a house, or retiring,’’ he says.
‘‘Those aren’t goals of mine in the next five years. Buying a house is looking more like the next 10 years.’’
He describes New Zealand’s house inflation as ‘‘absurd’’, and saving in bank accounts just isn’t going to return enough to get young people into homes.
Leaper says investing as he does from his remote home would have been impossible just 10 years ago.
But online investment services, and access to a world of data, means he can be as effective an investor as if he lived in a major city.
Stake chief executive Matthew Leibowitz says the company has a ‘‘smattering of customers across regions, but I wouldn’t say geographically James is typical of our current base’’.
‘‘It’s more skewed towards metro, but then again so are population volumes. But James is what we stand for at Stake. We’re all about access. You should have the same access to opportunities no matter whether you’re in Akaroa or Atlanta.’’
Leaper’s technology focus is not only a feature of younger self-directed investors, it is the biggest focus for Stake’s investors aged 45 or over, as well. Leibowitz says.
‘‘The one difference we see is that young investors are more future-focused. They get behind categories they think will change the world five, 10, 15, and 20 years from now. Things like AI, robotics, and genome sequencing,’’ he says.
Younger investors, aged 35 and under, make up two-thirds of Stake’s investors, and have a wide range of goals, he says.
‘‘It’s their mindset that binds them together. It’s about feeling in control of their own destiny, their own progress.’’
Sharesies co-chief executive Sonya Williams says investors under 35 often focus on companies they use in their own lives, but are also focused on companies whose values they see aligning with their own.
They are also really focused on growing their portfolios ‘‘one pay day at a time’’, putting money into shares regularly.
Many split their money between diversified exchangetraded funds, and the shares of a few companies they really believe in.
‘‘What we’re told is most are investing for the long-term, 10-years plus, and they are really looking to develop their wealth at a time of rising house prices, and low interest rates,’’ Williams says.
‘‘Financial freedom, that comes through so strongly.’’
Yes, there’s a focus on buying a home, but it’s really about being able to give themselves choices in the future, Williams says.
‘‘Money is never really the end goal. It’s an enabler of the life you want to live.’’
Despite younger investors being more active buyers and sellers, Williams says they are typically intent on building their portfolios.
Leibowitz doesn’t believe the democratisation of investment has made markets more volatile.
‘‘It’s not related at all to the democratisation of the markets. Markets have and always will have volatile periods. The current levels of volatility are historically low.
‘‘It’s just that we have a more mainstream audience following the ups and downs.’’
‘‘Young investors are more future-focused. They get behind categories they think will change the world five, 10,15, and 20 years from now.’’ Matthew Leibowitz Stake chief executive