Wombat offers theme-based investment through ETFs

Kane Harrison, Wombat Invest

Execution-only ETF investment platform Wombat Invest has added medical cannabis to its range of investment themes aimed at 25 to 35 year olds. 

Kane Harrison, founder and CEO, founded the company at the end of July 2019, inspired by the experience of buying a share in his youth.

Harrison, born in Melbourne, Australia, saved up to buy shares in a mining company when he was 15 and saw them go from AUD800 to AUD1400 in three or four months.

Harrison worked in the investment banking sector in Australia before taking up traveling. He arrived in the UK in 2013 with his sister and established a Dutch pancake business called StackedUK.com which grew to three locations and 25 staff.

With that business up and running, Harrison’s attention turned to investing. “People want to invest in stuff they inherently understand and use,” Harrison says. “They want a diversified basket within a theme they are into and so that is the idea behind Wombat – you can buy baskets of things that diversify into the sectors you know.”

Wombat offers a range of portfolios covering themes such as The Goodies, Gold or The Snack Attack, and the portfolios are supported by five ETF providers with more coming.

The majority are from BlackRock but other data providers include HSBC and Vanguard and the medical cannabis offering comes from new ETF provider Rize ETFs.

The portfolios have risk ratings depicted with chillis – the greater number of chillis, the more risky the underlying, but the Wombat offering is entirely execution-only, with no advice.

Working with custodian and investment partner SECCL, now part of Octopus Investments, Wombat is able to offer fractional trading to 12,500 customers as they run the book one share ahead of customer orders. 

The service is free to customers with less than GBP1000, while over GBP1000 the fee goes to GBP1 a month and 0.45 per cent of assets under management, plus the underlying ETF fees.

Recent volatility has seen inflows increase. “We are a mass market product with people putting in GBP50 or GBP100 a month constantly investing and seeing it as a time of opportunity that you are getting shares at a discount.”

Medical cannabis fits the Wombat demographic well, Harrison says. “It’s such a large industry with good properties for people at the forefront now.”

New products on the launch pad include the Wombat World Series as the Olympics get closer, an Impact portfolio and Women in Power.

“The whole purpose of Wombat is that you can invest in one team or all 18 teams,” Harrison says.

Working with their investment partners, Wombat has more individual direct fractional shares coming over the next few weeks, with the offering very much focused at their target youthful audience – Wetherspoons, Boohoo, Next and JD Sports.

The future also holds US and European fractional shares at some point, Harrison says.

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