You’re a Spaceship customer, but you’ve seen that Pearler has launched Pearler Micro – a micro investing option that sits within Pearler’s all-in-one share investing platform.
If you’d like to make the switch from Spaceship to Pearler and you’re wondering: “how could I invest like I do on Spaceship, using Pearler Micro?”, you’ve come to the right place. This article outlines how to transition from Spaceship’s most popular portfolios – Universe & Origin – to a passive investing approach using Pearler Micro.
How does Spaceship Universe compare to Pearler Micro
Spaceship Universe aims for a high-growth investment strategy, and invests in companies listed on Australian and international securities exchanges. The fund is designed for investors seeking potential capital growth, and the risk profile is deemed as Very High.
Spaceship Universe invests 100% of your money in tech companies, which fall under the broader classification of “growth assets”. Spaceship Universe particularly focuses on American (62%) and Australian (17%) technology companies, with the remaining 21% split across technology companies originating from other countries.
At Pearler, we’re all about passive investing – and the numbers don’t lie! Passive investors consistently outperform active investors; according to S&P Global, eight in 10 professional active investors were outperformed by passive investors over the last 10 years. So, if you’re going to make the jump to Pearler, you need to make the mental jump to passive investing too.
Should you choose to do that, and if you still want to have a similar (but passive) asset allocation to Spaceship Universe, you could pair three Pearler Micro options: Global Large Companies (62%), Aussie Large Companies (17%) and An American Buffet (13%). By doing this, you will get the same 100% growth asset allocation, and have a similar geographical split. What’s more, it costs less too. The two key differences are:
- This will be a passive portfolio – you won’t be relying on a fund manager to pick winners that beat the market for you. Instead, you’ll be opting to get the same returns as the market, whatever those returns may be.
- This will be a more diversified portfolio – you won’t just own “technology companies”, you’ll own companies throughout the entire global economy. This has advantages in that your portfolio will be less volatile, but the potential disadvantage is that your portfolio won’t increase in value quite as much if technology companies outperform the rest of the market.
Here's the summary:
How does Spaceship Origin compare to Pearler Micro?
Spaceship Origin pursues a rules-based investment strategy that identifies companies with large market capitalisations and applies an equal weighting within each asset allocation. It is better-aligned with our community’s approach to investing than Universe because it is diversified across the global economy.
The one big difference is that this fund is also actively managed. This means that Spaceship Origin investors are still inherently betting on Spaceship to be able to choose the winners. As above, this is a significant difference in approach to Pearler, as we’re firm believers in passive investing.
Spaceship Origin invests 100% of your money in large global companies across all industries. Specifically, Spaceship Origin invests 82% of funds in large internationally-headquartered companies and the remaining 18% in large Australian companies.
Anyone who wanted to invest in a similar (but passive) way using Pearler Micro could pair two Pearler Micro options: Global Large Companies (82%) and Aussie Large Companies (18%).
Moving past Micro
The beauty of Pearler is that we’re with you for your whole investing journey.
As your confidence in your investing knowledge grows, you may (or may not) decide you want to try investing directly in shares and exchange-traded funds (ETFs). With Pearler, you can invest directly in shares and ETFs alongside Micro and you can even transfer your Micro investments into direct share and ETF investments.
If you decide you want to explore direct share investing, we’ve got a blog for that too (see CHESS-sponsored vs Custodial ).
Should I transition from Spaceship to Pearler Micro?
Pearler Micro is currently cheaper and offers more features and flexibility than Spaceship, but the most important distinction is the difference in investing approach. Pearler Micro is all about passive investing, whereas Spaceship takes an active investing approach.
Fundamentally, if you want to actively try to outperform the market, then no, you shouldn’t make the switch. But if you’re a proponent of passive and long-term investing, then Pearler Micro may be worth considering. Again, here are the key differences.
Happy investing!
Footnote:
It’s worth noting that we’ve included the underlying exchange-traded fund (ETF) management fee in addition to the platform fee in this analysis. Often micro investing platforms glaze over this fee because it’s difficult to understand. At Pearler, though, we’re all about transparency and education.
The simple explanation is that when you invest on many micro-investing platforms, your investment is placed into one or more ETFs based on your selection. The people who make ETFs, known as the ETF managers, get paid by taking a fee from the ETF itself.
As an investor, you don’t ever see the ETF management fee. It’s simply deducted from each ETFs’ value at the end of every month. However, it’s an important investment consideration because you don’t want to invest using a platform that has low platform fees but high underlying ETF fees.
