The online delivery giant Amazon trades on the NASDAQ for around $3,200 – which equates to about R60,000.
Investing in these companies requires deep cash reserves and is often an unrealistic endeavour for many South Africans, but low-cost DIY investing platforms such as Mexem Africa have made investing into offshore stocks more accessible.
Through their partnership with Interactive Brokers LLC, Mexem has the ability to offer trading in over 130 exchanges in all financial instruments. Now, Mexem has launched a Fractional Share Trading feature which allows you to trade fractions of a stock. So, what does this mean? We spoke to Ryan Gordon, CEO of Mexem Africa.
“With our fractional share feature, it opens up a whole new world of investing for our clients. Now Mexem Africa customers have the opportunity to invest in fractions of stocks on American Exchanges. South Africa has always been a bit far behind the rest of the world especially in the world of investments. Mexem’s whole notion is to democratise access to shares and investments,” said Gordon.
“This is one of our many steps”.
With increased volatility in capital markets over the last 6-8 months, many people have seen an opportunity in this environment; however the majority lack the capital.
Gordon adds: “We found that people want to start their investment journey with shares they love, normally one or a few of the FAANG”.
The FAANG Stocks are Facebook, Amazon, Apple, Netflix and Google. These are the most prominent American technology companies that we hear about on a daily basis.
“From our research South Africans spend between 8-12 hours a day interfacing with these brands and wearing them in their everyday lives, myself included!”
With Mexem Africa’s services, instead of saving up and forking out your hard-earned savings for expensive shares, you can now invest in Dollar terms.
How it works
“When a client makes an order, instead of quantity of shares, you are able to put in a Dollar amount,” said Gordon.
For example, Mexem clients can buy $50 worth of Amazon and $30 worth of Facebook. Mexem mirrors Interactive Brokers fees, and as such the commission charged on fractional trading is a minimum of USD1 per trade.
“This is an exciting time in Mexem, fractional shares provide for an innovative product, designed specifically with financial inclusion in mind. Our aim is to drastically minimize barriers to entry for individual customers and institutional investors,” said Gordon.
Another added feature is that fractional shares are also enabled on Mexem’s advisor accounts. This means that financial advisors and asset managers can now also trade fractional shares for their clients.
Gordon adds that Mexem is continuously finding ways to bring international pricing and trends to the African market to cater for all types of accounts in their client base.
They are building an expanding network of partnerships to round off its full-service offering, the latest with SignalsBank, an automated trading signals provider.
Earlier this year a joint solution was entered into with Bloomberg L.P. allowing Mexem’s institutional clients to receive high-level and in-depth portfolio and risk analytics (PORT) through the Bloomberg Terminal in live time.
“Our current focus is on building our brand within the South African market, providing the most professional customer support to our clients, we have plans to expand into Africa in early 2022 and USA and Asian markets in late 2022”.
This article was published in partnership with Mexem.