Tell us about The Big Exchange.
The Big Exchange was co-founded by The Big Issue with the aim to give UK consumers greater access to financial services that could make a real difference to them as individuals, but also to society and the environment at the same time. This idea grew out of The Big Issue’s wider mission to transform society; specifically in this case through providing individuals with access to financial services that made a real positive difference on people and the planet.
Launching its impact investing website in 2021, The Big Exchange became the UK’s first fund platform to assess and rate investment funds for their positive impact on people and provide customers with 100% transparency on where their money is invested.
It all sounds like a good idea, but does The Big Exchange (TBE) add another layer of admin and therefore more fees?
No, that’s not the case and we don’t see this as admin, it’s about providing customers with the information and transparency they need to make an investment decision in a space where, for retail investors, trustworthy information is not easy to find. There are a lot of companies talking the talk, but who is walking the talk? That’s what we set out to answer for people.
And to your point on fees, we don’t charge extra for providing an impact assessment. We focus on offering great value to our customers, and our fees are at the lower end of what is available to UK consumers. Every investment has to prove its positive contribution to people and/or the planet. Or it doesn’t make it onto The Big Exchange. This is all included in our annual platform fee of 0.25%, which is amongst the cheapest on the market. This means that for every £100 a customer invests, they pay 25p in fees to The Big Exchange.
We do not manage the investments, so like with other fund platforms, there is a fee to the manager running the fund in which the customer chooses to invest. This ranges between 0.3% and 1.8% per year. Importantly, there are no entry, exit or trading fees and minimum investments into funds have been removed so there are fewer barriers to getting started. There is a simple calculator tool on our website that gives customers an idea of what they might pay all-in.
To your second point, our aim is to make investing more accessible but not by cutting corners. We have done the leg work for our customers and make it easier for them to choose investment funds where the underlying companies are creating positive solutions to combat the world’s biggest challenges.
ESG investing was all the rage until about three weeks ago - but now Nigel Farage has launched a campaign for a referendum on the government’s net zero pledge - do you think this is an enduring way to invest for the future? What does TBE offer investors that’s different from the overwhelming flood of ESG funds?
To us, this is about understanding where your money is invested and what it is funding – that’s information our customers care about and value. And, regardless of what you invest it in, it only feels right to have access to that, no?
Currently, it’s so hard to get that level of detail – in fact for most funds it is impossible to see full holdings. On The Big Exchange, we let customers see full holdings and which companies a fund invests in, before they buy. For your readers that have ISAs, can they find out what their ISA is funding: is it fossil fuels, tobacco, animal testing, Russian companies? Does that fit with their values, beliefs, or even where they spend their money? Ultimately, people want to know this, and people want to shape their own futures for them and their kids.
We don’t just let any fund labelled “ESG” on The Big Exchange. We only offer funds that have proven that they walk the talk – that’s our way of fighting back against greenwashing.
How many funds does TBE and why? If there are 65 funds on TBE is there some overlap between them?
There are 61 funds from 21 different Asset Managers on The Big Exchange in total – we have just added nine new funds and keep adding more.
Customers can choose risk rated bundles of funds that have been put together with help from The Big Exchange’s Investment Committee to give people access to a starter pack. Or, they can get to the detail and see how each individual fund is run and what companies are in it, to allow them to build their own portfolio.
Why does TBE think themed funds/investing is important/appealing (why isn’t it a marketing gimmick?) Is the theme such as healthcare chosen because it’s profitable or because it’s ‘a good thing’?
This is where we listen to our community to understand more about what they want. We focus on being straight talking and transparent. A key driver for all of our customers is to aim to make a financial return over the long term, the fact these funds can do this while also investing in areas that matter to customers is a win win.
How do customers know how their investment is doing? What is my return compared to? I want to know how much I’ve got invested and how much it’s gone up by - would TBE tell me that?
Yes. As with any other investment service, showing customers how much they have invested to date and how much their investment has gone up – or down is one of the most important things.
All funds on The Big Exchange must show performance against a comparable benchmark that is relevant to the fund/s they have invested in.
Who are your customers? What is the customer profile? Why does TBE appeal to women?
Our customer base is broad and inclusive, across age, geography and gender and is a true reflection of what we set out to achieve. We want to make investing to create a positive impact accessible and easy to understand for everyone. Around 40% of our customers are first time investors and we also have people moving established ISA investments from other investment platforms to The Big Exchange. As you mention, 50% of our customers are women and a recent study from BNY Mellon showed that over half of women would invest more if they could see it aligned with their personal values and that rises to 75% when speaking to parents. For our customers all over the UK, we are delivering something that they haven’t found before.
