‘Investing FOMO? Take a Mo’: New Zealand urges DIY investors
There are four DIY investor types: planter (42%), opportunists (19%), speculators (20%), and dabblers (19%).
New Zealand’s financial watchdog, the Financial Markets Authority (FMA), has urged DIY online investors to pause before succumbing to investment FOMO.
The FMA is the lead agency for World Investor Week in New Zealand and is running with the theme, ‘Investing FOMO? Take a Mo’.
The regulator will be sharing the Five D’s of DIY Investing throughout the week:
– Do your due diligence
– Drip feed your investments
– Diversify your portfolio
– Don’t freak out if markets go down, and
– If in Doubt, talk to a financial adviser
There are four DIY investor types, according to the FMA. One in particular identified in the research, the ‘planter investor’, makes up (42%) of DIY investors. These tend to be comparatively younger with a female skew, and see DIY investing as a significant part of their financial strategy.
The other DIY investor types are opportunists (19%), speculators (20%), and dabblers (19%), says the FMA.
Gillian Boyes, FMA Investor Capability Manager, said: “Our research found planters have 52% of their investment portfolio in online investing platforms. This suggests they are putting a large portion of their income into DIY platforms and may have more to lose in a market downturn, with larger portfolios and less time to recover.
“Planters have good intentions around investing but don’t always research potential investments thoroughly, such as making decisions based on whether a company is well-known. We want to use World Investor Week to remind DIY investors about good investing habits and steps they can take to protect themselves.
“As part of their due diligence, we’re encouraging planters to ask themselves some important questions before making an investment. These include, will the investment earn an income? Do I understand the company I’m thinking of investing in? Is the share price reasonable? What fees or costs are involved? How can I get my money back? Is it a legitimate offer?”
The FMA has recently announced its new Chief Executive Offcer, Samantha Barrass. The industry veteran brings deep international regulatory experience and leadership skills to the role while maintaining a strong New Zealand connection.
The industry veteran has worked in a range of regulatory and executive roles in the UK and Europe: between 2014 and 2019, Ms. Barrass was the Chief Executive Officer of the financial regulator in Gibraltar. The role encompassed conduct and prudential regulatory oversight.
Earlier in her career, she worked for nine years in a number of roles at the Financial Services Authority in the UK (now the Financial Conduct Authority).
Samantha Barrass led the establishment of the UK’s Business Banking Resolution Service, an innovative service designed to resolve disputes between banks and their business customers. Ms. Barrass began her career as an economist at the Reserve Bank of New Zealand.
She will take up her new role in January 2022, subject to COVID-19 practicalities. The FMA’s current Chief Executive, Rob Everett, leaves at the end of October. FMA General Counsel Liam Mason will be Acting Chief Executive during the months prior to Ms. Barrass’ arrival.