US share trading app targets Generation Z

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<br>A new share trading app is targeting Australians as young as 22, helping them buy into US-listed companies.<br> <br>The Goodments by Douugh app promises commission-free fractional trading in US securities and ETFs, making money through foreign exchange fees rather than charging a commission to its 13,000 customers.<br> <br>”You could buy one dollar’s worth of Apple or Amazon, it means there is no barrier to entry,” Douugh founder and CEO Andy Taylor told AAP.<br> <br>Mr Taylor said the app was designed for customers who feel they have been locked out of the housing market and want to invest in shares instead.<br> <br>”For many Australians, particularly in Sydney and Melbourne, it’s just perceived as out of reach, it’s a real generational shift,” Mr Taylor said.<br> <br>”What they want is a quality experience which banks are not giving them.”<br> <br>But Professor Steve Worthington from Swinburne University told AAP on first glance the Douugh business model may not work.<br> <br>”I’d have to say I don’t think that’s going to be sustainable … I don’t think that is a business model, relying on forex fees,” he said.<br> <br>Neobanks have a mixed record in Australia so far, with the collapse of Xinja, Judo Bank postponing its IPO and NAB buying 86 400, while competitor Volt enters the fiercely contested mortgage market.<br> <br>Mr Taylor insists Douugh is not a neobank at all but rather a fintech, binary options 60 seconds system restore operating without a banking licence through its backing from Regional Australia Bank.<br> <br>The company intends to offer card services and launch a Douugh banking app in the near future, while it plans to convert the just-launched Goodments app into a new platform called Wealth Jar.<br> <br>”We are a capital lite software business, we are monetising the software,” he said.<br> <br>Prof Worthington said it remains to be seen whether younger customers will stick with app-based share investing once they have a taste of its volatility.<br> <br>He cited the US example of trading app Robinhood, which facilitated a massive pile into Gamestop stocks, but many people ended up losing money.<br> <br>”There will be a decline and when the stocks drop off that is when you get found out,” he said.<br> <br>”A rising tide lifts all boats but when the tide goes out some boats will sink like submarines.”<br> <br>Mr Taylor said the app is not a platform for day trading despite its fee structure, and said the company is trying to be responsible by encouraging people to invest and hold for the long term.<br> <br>The app offers access to more than 4000 stocks but it does not facilitate investment in companies that are directly involved in oil, tobacco, fur or military and weapons products.<br> <br>He maintained a low interest rate environment will work in favour of Douugh, when investors realise they are not making money through traditional bank deposits.<br>

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