Here we look at The Big Exchange – an online investment platform that will only invest in funds that are proven to be making a positive difference to the planet and its people.
The deal
Launched in October 2020, The Big Exchange – co-founded by The Big Issue – has 40+ funds to choose from. They are all rated against the United Nations Sustainable Development Goals, or “Global Goals”, for the type and level of positive impact they are making.
Each fund is awarded a gold, silver or bronze medal, with gold having the highest ability to bring about positive change.
You can choose funds that tackle the issues you care about most. If you are keen to invest specifically in tackling climate change for example, The Big Exchange now offers the Multi-Asset Climate Fund (MACS Fund). This invests solely in companies that are actively working to help lower carbon emissions. To be included in the fund, they must get 50 per cent of their revenue from climate solutions.
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User-friendliness
The Big Exchange aims to make investing convenient and accessible to anyone with savings (including those with zero experience of investing).
You can sign up in under five minutes and start investing from just £25 a month or a lump sum of £100.
The platform walks you through the process of investing in easy steps. First you choose which account you would like to open, starting with a stocks and shares Individual Savings Account (ISA) or Junior ISA or – if you have maxed out your ISA allowance for the year – a General Investment Account (GIA).
The Big Exchange offers three ready-made portfolios – ‘cautious’, ‘balanced’ or ‘adventurous’ – put together by experts based on the level of risk you are comfortable with. If you’re a more experienced investor (or want to invest specifically in issues you are most passionate about) you can pick your own funds.
Whether you choose a bundle or a more pick-and-mix approach, you simply add the product you want to your shopping basket and go to the checkout. Once you have set up your bank details for a direct debit or to transfer a lump sum, you’ll be taken to your personal ‘dashboard’ where you’ll be able to see the balance of your investments and how they are changing over time.
Sustainable investing option
The Big Exchange was created to help build a cleaner, more sustainable world that is inclusive to everyone. Therefore it will only invest in funds that are making a positive impact on the planet and society.
All the funds available on The Big Exchange are aligned with its mission to create positive change. They are managed by industry heavyweights including Aberdeen Standard Investments, AllianceBernstein, Alquity, Civitas Social Housing plc, Columbia Threadneedle, Liontrust, Pictet, Quilter, Stewart Investors, Tortoise, UBP, Nordea and WHEB.
Unique selling points
- The Big Exchange only includes funds that are making a positive impact, so you can feel confident your money is being used for good.
- You have the option to choose funds that are tackling the issues you care most about.
- The impact each user creates is recognised and rewarded with a digital ‘social passport’
The plus points
- Simple and quick to set up – start investing in just a few minutes
- Fees are kept low at 0.25 per cent, in line with The Big Issue’s mission to make finance accessible to everyone.
- Minimum investment is low at £25 a month or £100.
- The Big Exchange invests in actively managed rather than passive funds – meaning you can make maximum positive impact with your money.
- You can transfer existing investments.
Any drawbacks?
- The Big Exchange is currently only available on desktop, although a mobile app is in the pipeline.
- As it is newly-launched, it has yet to build up a meaningful track record.
Cost of use
The Big Exchange aims to make investing accessible to as many people as possible, regardless of wealth and financial background. It therefore keeps costs as low as possible, with an annual service and administration fee at 0.25 per cent. This means that for every £100 you invest, you will pay 25p in fees.
On top of this you will pay a fee to the manager running the fund you choose to invest in. This varies depending on who you go with, but typically ranges between 0.8 per cent and 1.8 per cent, per year. Bear in mind that these fees are higher than those for passive funds. However, it means you can achieve a higher level of positive impact (and, possibly, return too) as fund managers are actively picking companies that are contributing to a more sustainable future.
How do these costs compare to competitors?
The cost of The Big Exchange is among the cheapest on the market. Newly-launched Clim8 Invest, which invests in listed companies that tackle climate change, has an annual management fee of 0.6 per cent (alongside a portfolio fee of 0.35 to 0.5 per cent).
Mobile-only app CIRCA5000, which we review here, charges a flat fee of £1 a month.
Traditional investment platforms Hargreaves Lansdown and BestInvest charge 0.45 per cent and 0.4 per cent respectively.
Other options
