Hatch Invest Review (2024)

Our Review

• In this guide, we outline what Hatch is, its features, fees, FX conversion rates and how it differs from other overseas share investing platforms such as Stakeand Sharesies (for US-listed shares and ETFs).
• Hatch, like other platforms, is challenged by the likes of Superhero (which offers US$2trade fees), and Tiger Brokers which offers low FX fees.
• We also compare it to established alternatives such as ASB Securities,and ETF platforms like InvestNow.

Important: Sharesies and Stake Fee Change

• On 21 December 2022, Sharesiesannounced a fee changethat affected most customers. In short, the average investor's brokerage fee jumpedfrom around 0.50% to 1.90%. Theforeign exchange feealso increased from 0.40% to0.50% (to match Hatch's fee).
• Stake announced it was ending its 'free trade fees' in March 2023 and charging $3 per US trade up to $30,000, or 0.01% per US trade $30,000 or greater. This guide reflects Stake's fee increase (and references to Sharesies and Hatch where relevant).
• Please be aware that for most New Zealanders who invest around $500-$5,000, the new fees significantly increase trading fees, making Sharesies and Stake less attractive compared to Hatch.

Our review covers:

• Hatch Pros & Cons
• ​The Bottom Line
• ​Limitations
• Who is HatchSuited to?
• ​Fees
• The Specs of Hatch
  
• Can I Trust Hatch With My Investments and Money?
• The Competition
• 5 Things to Know About Hatch

Want to compare Hatch with Sharesies with and Stake for US Shares?Visit our comprehensive guide​

Other options: Superhero offers US$2 trade fees, and Tiger Brokers offers low FX fees; our Superhero Review and Tiger Brokers Review explain more.

Learn More About Hatch

Hatch - Pros & Cons

Pros

• You own your own shares: Hatch is the only New Zealand based platform that gives you your own US brokerage account with their partner Drive Wealth. This means you own your shares; Hatch (or another third party) doesn't own them for you.
• Zero subscription fees: Hatch doesn't charge subscriptions fees, which means you get to keep your profits.
• Voting rights on your shares: Because you own your shares with Hatch, you get full shareholder voting rights on any whole shares you own. This means you get to have your say in how the companies you're a shareholder in make future decisions.
• Kids Investment Accounts: Parents and guardians can open a Hatch Kids Investment Account for their children with lower fees than adult accounts, with reduced fees.
• Easy transfer from existing brokerages: You can transfer USD or US shares into Hatch from other investing platforms. You'll need to contact the Hatch support team who can guide you.
• Easy to use interface, with 4,600+ companies and 1,300+ ETFs in the US market.
• Option to buy partial shares, for example 0.65of one Google share, or 0.40 of one Apple share etc, as well as buy/sell shares in whole dollar amounts.For example, buying$10,000 NZD in Amazon which translates to 2.216 shares.
• US tax obligations are taken care of at source (an annual $0.50 fee per account appliesfor US tax reporting). An initial one-off $1.50 is charged to complete tax filings.
• Data for NZ tax obligation informationfor investments are provided by Hatch, allowing customerstocomplete their income tax return or work with their accountantefficiently. Hatch also offers FIF reports and calculations, which are usually a real pain point for high-value investors. More details can be found here.
• Much lower FX fees and brokerage commissions compared to incumbents Jarden Direct and ASB Securities.
• Limit orders: you can buy shares at a set price or set an alert to when the share falls to that level. Hatch lets you enter the exact number of shares you want and the price you want to pay for them (e.g. 5 shares at $50 each). If the market price matches yours or goes lower, your order will be filled.
• Trust accounts: Family trusts can easily add US shares to their investment portfolios.
• You can invest in American Depositary Receipts (ADRs): Hatch allows you to invest in certain foreign companies listed on foregin share markets such as NIO and Alibaba.
• Browse by Megatrends: Browse the companies and ETFs at the forefront of the industries of the future.
• Auto-invest: Choose how much and how often you want to invest.the basics of investing and there's a Hatch investors Facebook group for questions.
• Course: Hatch has created a simple online course covering Hatch has createdaSimple Online Course covering the basics of investing and there's a Hatch investors Facebook group for questions.
• Stop-loss orders: Hatch offersstop-loss;if you want to automatically sell shares when the price reaches a certain level (known as a 'target price'), Hatch allows this.​
• Support is online and via phone and limited to the hours of Monday to Friday, 9am to 5:30pm, Their FAQs/help centre are thorough and in our experience the live chat and email replies were very responsive.
• Hatch lets you sign up for free and add shares/ETFs to a watchlist to follow their progress until you’re ready to invest.

​
Cons

• No app - Hatch has stated they will develop oneif there is demand, but right now users can still save the website icon to your homescreen which works in a similar way.
• No joint-accounts offered (Hatch has informed MoneyHub that this feature is being scoped).
• No other foreign markets offered (i.e. UK, Germany, Australia)but investors can access ADRs, foreign shares listed on the US share markets.
• Good Faith Violation rules (read the policy here)limits any day-trading or inter-day trading. If you sell one parcel of shares and buy new shares onthe same day, you must wait at least 3 working days beforeselling them due to the cash being 'unsettled'.
• No hedging options - unlike many New Zealand ETF investments available throughSharesiesorSimplicity, Hatch does not provide any foreign currency hedging. This means if the NZD goes up against the USD, and all other things being equal, the NZD value of an investment will be less due to theUSD being worth less.

Must-read Hatch-related guides

1. Want to compare Hatch with InvestNow, Sharesies and other platforms?Read ourComparing Sharesies vs Investnow vs Hatch and moreguide.​
2. Worried about what happens to your investments if Hatch collapsesor shut down?Oureasy to read custodian guideexplains what you need to know.
3. Wanting to invest in the US Stock market from New Zealand?Our guide explains everythingyou need to know.​
4. Want to learn about ETFs? Our ETFs guide has you covered.
5. Want to compare ETFs with shares?Our dedicatedETFs vs Shares guidehas you covered.

Learn More About Hatch

​The Bottom Line

• ​Hatch offersa tremendous number of options for exposure to US-listed shares and ETFs, unrivalled by any other New Zealand-based platform.
• The platformworks best for investing $100s or more at a time, as they include a 0.5% fee in the FX rate to exchange your NZD to USD, and a flat $3 USD an order, to buy or sell up to 300 shares (then it’s $0.01 a share).
• Kids Account pricing at 50c to buy or sell shares allows for smaller investing amounts into their accounts - perfect for gifts or regular weekly/monthly contributions.
• If customers deposit NZD anytime before around 2pm NZT, per our discussions with Hatch, it should bebe in their Hatch account as USD available to investuseby 5pm NZT. This means that while it's not instant, in most cases it's available within the same day. This Hatch help centre article has more information.
• There are no custodial fees for investments and you won't pay any account management fees.
• Many New Zealand investment platforms and fund managers limit access to unethical investments - Hatch has no such limitations. They also have a much larger array of funds than accessible locally, to suit investor preferences for anything from robotics to clean energy and the future of food

Limitations

• ​FX fees - 0.5% on the interbank rate is lower than banks and often the lower than online currency conversion tools. Hatch has also confirmed they provide discounts for deposits over $100,000. Hatch gives the following example:

1. Base exchange rate (Interbank rate): 1 NZD =0.67 USD
2. Hatch rate: 1 NZD = 0.6667 USD (0.67 - (0.67 * 0.005)
3. We calculate the FX margin at 0.49% on the transaction above (1-(0.6667/0.67)=0.00492)
   Using this example, if you deposited $10,000 the Hatch exchange rate would be 0.6667 resulting in $6,667 USD.

Who is Hatch Suited to?

• Best For:
  • Investors looking for US-listed shares or ETFs not otherwise available to New Zealanders viaInvestNoworSmartShares.
  • Investors looking to own their shares and have a say in the future of the companies they invest in.
  • Investors looking to build long-term wealth - “set-and-forget”. Their fee structure means it’ll only be 3 USD to sell shares means your profits won’t be eaten.
• Not suitable for:
  • Passive investors investing less than $100-200 at a time. A $3 USD fee is only the price of a cup of coffee, but investing a little more gives you better bang for those bucks. Hatch offers a simple way to keep fee percentages low by allowing auto-investments into all 3,000+ companies and ETFs. Passive investors can deposit small amounts when it suits, then set a timeframe and amount to invest at regular, automated intervals.
  • Day trading - Hatch is not designed for day trading but does allow it.​
    

Must-read Hatch-related guides

1. Want to compare Hatch with InvestNow, Sharesies and other platforms?Read ourComparing Sharesies vs Investnow vs Hatch and moreguide.​
2. Worried about what happens to your investments if Hatch collapsed or shut down?Oureasy to read custodian guideexplains what you need to know.
3. Wanting to invest in the US Stock market from New Zealand?Our guide explains everythingyou need to know.

Learn More About Hatch

Hatch Fees

Hatch charges two fees - a brokerage fee (for the purchase or sale of shares and ETFs) and an exchange rate fee (for converting NZD into USD to fund your account, and from USD to NZD when withdrawing money from your account).

1. Hatch’s brokerage fees are clearly stated:

• US$3 an order, to buy or sell up to 300 shares, then it’s $0.01 a share

2. Hatch’s exchange fee is 50 bps or 50 pips.

• Ifthe interbank exchange rate was NZ$1 = US$0.7000, an investor would receive US$0.692for every dollar they invested.A walkthrough of Hatch fees explains this in detail:

1. Investor A wants to buy NZD 1,000 in Walmartshares, priced at USD100 each. Investor A transfers their NZD to their Hatch account when the interbank NZD:USD exchange rate is 0.70. The investor receives 0.695USD per NZD (deducting the 50 pips/bps)and receives USD 695.00.
2. Investor A then puts an order in for Walmart shares with the available balance. The brokerage fee of USD 3 is charged for the purchase, and Investor A receives 6.9000Walmart shares (valued at USD 690.00).
3. When Investor A wants to sell the shares they will pay another USD 3 for brokerage. The USD value will then sit in Investor A's Hatch balance.
4. If and when Investor A wants to convert the USD balance back into NZD (as opposed to re-investing it), there is a fee to do this. If theinterbank NZD:USD exchange rate is again0.70, the investor will have the balance transferred at a rate of 0.705(adding 50 pips/bps). For a parcel of shares valued at USD 700 this would calculate to be a USD 3.50 fee (USD 700 X 50 bips).
5. Hatch investors ultimately benefit from economies of scale - the higher the value of an individual share purchase, the lower the brokerage fees areproportionately on the share parcel.

Must-read Hatch-related guides

1. Want to compare Hatch with InvestNow, Sharesies and other platforms?Read ourComparing Sharesies vs Investnow vs Hatch and moreguide.
2. Other options: Superhero offers US$2trade fees, and Tiger Brokers offers low FX fees; our Superhero Review and Tiger Brokers Review explain more.
3. Worried about what happens to your investments if Hatch collapsed or shut down?Oureasy to read custodian guideexplains what you need to know.
4. Wanting to invest in the US Stock market from New Zealand?Our guide explains everythingyou need to know.

Learn More About Hatch

​​The Specs of Hatch & How it Works

1. Signing Up

• Hatch is open to anyone over 18, residing in New Zealand as a tax resident and holding either a New Zealand passport or driver’s license.
• Hatch also offers Kids Investment Accounts for ages 0-18 which can be opened by a parent or guardian within their own Hatch account.
• Hatch complies with US and New Zealand law by asking for a number of personal details, specifically your employment status, annual earnings, how much you expect to invest, and how frequently you expect to invest.
• Once Hatch verifies your information, your account will be approved (usually immediately) and you can deposit money.

2. Depositing Money

• Hatch only accepts bank transfers - customers deposit New Zealand dollars to a Hatch trust account where they are exchanged into US dollars. No balances are held in NZD. The exchange rates are made clear before you transfer any money - we talk about fees above.
• Hatch exchanges money every business day around 2pm – so if you deposit before 12pm, your money usually hits your Hatch account first thing the following morning – often before the US markets open. If you deposit on a Friday after 3pm, you'll wait until the following Monday for your money to be exchanged.
• Once your Hatch account has received the US dollars, you can start investing.
• Once a withdrawal has been requested, it can take up to four business days for the USD to be converted back to NZD and deposited into your NZ bank account. Normally this process is a lot faster than the indicated four day maximum timeframe.
• Within your Hatch account, any uninvested money istransferred into the Money Market Fund (DARXX), offering alow-risk cash deposit (with an annual pre-tax return of around 0.50%).You can read more about money market funds inHatch's summary.

3. Buying Shares

• The US share markets open between 9:30am - 4pm Eastern Time (1:30am - 8am NZ time in summer and 3:30am - 10am in winter).
• Purchasing shares is straightforward; click on the share or ETF you want to buy, select your order type and quantity and confirm the order. Once the order is processed and you own the shares, brokerage fees are deducted.
• When you place an order, Hatch estimates how many shares you’ll get. If the share price changes before your order is completed, the number of shares you end up with might be different. For this reason having a buffer balance to avoid a rejected purchase if the price and quantityof shares exceeds the money available is a good idea.
• If you place an order for shares when the US markets are closed it will be processed when the market reopens. The closing price today may not be the same as the opening price tomorrow given market factors so you may receivemore or less shares than anticipated.
• Hatch offers aTransaction History report which gives you details of every deposit, withdrawal, and order. It also shows you every fee you’ve been charged, including tax reporting fees.
• Hatch works with two partners,DriveWealth (a US-regulated broker-dealer) and World First (an Australian-based currency exchange provider).

4. Future Trading and Keeping Track of Your Portfolio

• When you log in to Hatch, you can view all the shares and ETFs holdings you own, as well astheir respective market prices. You can also download monthly account statements.
• You can add shares to a watchlist and follow their progress until you’re ready to invest.

Learn More About Hatch

Can I Trust Hatch With My Investments and Money?

• Hatch is 100% owned by FNZ, a high-profile New Zealand Fintech company that operates in 20+ countries. FNZ is backed by high-profile venture capital firms such as Generation Investment Management, CDPQ, Temasek. As a background, FNZ provides the back-end financial infrastructure for many investment platforms such as Vanguard, Barclays, Jarden, Lloyds Bank, AMP, ANZ, and BNZ.
• The other important factor is that despite the pedigree of its underlying owner, the shares you purchase are ultimately held by overseas institutions.
• Moreover, Hatch is not registered as a 'financial product' by the New Zealand Financial Markets Authority due to the fact it only provides accessto trading opportunities in the US Share markets. Specifically, Hatch partners withDriveWealth, a broker-dealer regulated by FINRA (theFinancial Industry Regulatory Authority), which is similar to the FMA although it is a private corporation (not a government organisation) and acts as a self-regulatory organisation (i.e. federal laws do not govern it).
• Confusing mattersslightly, Drivewealth does not hold your securities. Electronic Transaction Clearing, Inc (ETC) custodies your shares. ETC is headquartered in New York City. Hatch is clear in saying you own your shares, but your name does not appear on a share certificate like it would if you purchased shares on the NZX.The certificate will show that the shares are held "in DriveWealth's name for the benefit of the Hatch customer". It may feel different from NZ, but is common practice in the US and is known as “In Street Name”. Unlike the nominee structures provided by other investing platforms, holding your shares In Street Name doesn't diminish your rights as the shareowner. You’re considered a direct owner of your shares, can transfer your full shares to and from Hatch at any time, get shareholder benefits and voting rights.
• In summary, Hatch, nor its parent company FNZ, hold your shares, and investors must be comfortable relying on standard practice in the US of “held in street name”.

Learn More About Hatch

The Competition - Hatch vs Stake, Sharesies, Superhero, Tiger Brokers, ASB Securities and Others

Shares alternatives

• The biggest competitor to Hatch is arguably Stake given their full focus on US shares - ourHatch vs Stakeguide compares the two platforms in detail.
• Outside of Stake, Sharesies offers US-listed shares and ETFs too. Like Stake, what platform is best will be determined by your investing profile as Hatch tends to favour those making larger-size investments (rather than trading frequently and/or investing small amounts). Our Sharesies vs Hatch vs Stake guide has more details.
• Hatch beats ASB Securities and Jarden Direct hands down for US share market purchases, but is not as competitive as international discount brokerage platforms like Interactive Brokers or Tiger Brokers. Superhero launched in New Zealand in May 2023 and offers US$2trade fees.
• Interactive Brokers -Trading and/or foreign exchange fees are lower than Hatch, Stake or Sharesies, but there is also more regulation around joining. We have covered the platform in detail in ourInteractive Brokersguide.

ETF alternatives

• Want to compare Hatch with Stake?OurHatch vs Stakeguide does this in detail.
• There are a number of US and global ETF options available to New Zealand investors without the need to translate NZD into USD. Many also have the benefit of offering currency hedging.
• Other options: Superhero offers US$2trade fees, and Tiger Brokers offers low FX fees; our Superhero Review and Tiger Brokers Review explain more.
• See Smartshares,SharesiesandInvestNowas examples.

Must-read Hatch-related guides

1. Want to compare Hatch with InvestNow, Sharesies and other platforms?Read ourComparing Sharesies vs Investnow vs Hatch and moreguide.​
2. Worried about what happens to your investments if Hatch collapsesor shut down?Oureasy to read custodian guideexplains what you need to know.
3. Wanting to invest in the US Stock market from New Zealand?Our guide explains everythingyou need to know.
4. Want to compare ETFs with shares?Our dedicatedETFs vs Shares guidehas you covered.

US Shares Trade Fees - Sharesies vs Hatch vs Stake vs Superhero vs Tiger Brokers vs Jarden Direct vs ASB Securities

• Our table below reflects the differences between trading platforms when buying US$1,500 shares (for example, around 9-10 Apple shares, or 5 Microsoft shares)
  
• All fees and costs are in USD
  
• Some platforms call their brokerage fee a 'transaction' fee or similar, but for the purposes of our comparison, we have kept the column's title consistent.
  
• We've ranked Superhero second in the table due to its conversion fee. Customers are charged NZ$0.50 for every US$100 converted from USD back to NZD. We believe this neutralises the seemingly higher 0.50% fee charged when converting NZD to USD (e.g. US$0.50 per NZ$100 exchanged) for the purchase of US shares or ETFs.
  

5 Things to Know About Hatch

Learn More About Hatch

Must-Read Hatch-related guides

1. ​Want to compare Hatch with Stake?OurHatch vs Stakeguide does this in detail.
2. Want to compare Hatch with InvestNow, Sharesies and other platforms?Read ourComparing Sharesies vs Investnow vs Hatch and moreguide.​
3. Other options: Superhero offers US$2trade fees, and Tiger Brokers offers low FX fees; our Superhero Review and Tiger Brokers Review explain more.
4. Worried about what happens to your investments if Hatch collapsed or shut down?Oureasy to read custodian guideexplains what you need to know.
5. Wanting to invest in the US Stock market from New Zealand?Our guide explains everythingyou need to know.
6. Want to learn about ETFs?OurETFs guidehas you covered.
7. Want to compare ETFs with shares?Our dedicatedETFs vs Shares guidehas you covered.
8. Want to transfer shares to Hatch? Our share portfolio transfer guide explains what you need to know.
9. Looking for an investing platform that offers funds rather than shares? Our reviews of InvestNowandKernel Wealth have you covered.

Do you have an experience with Hatch you would like to share with our users?Email our research teamwho would be delighted to hear from you.