Meghan Markle and Prince Harry are backing fintech, should you?

Want to live like a royal? Don’t we all. Meghan Markle and Prince Harry recently announced they’re getting into finance, saying they want to make investing more accessible – particularly to young people. Again, don’t we all. Specifically, they joined Ethic (a fintech asset manager focusing on sustainable investments), as “impact partners” though they will also invest. So, while you might not be able to live like Meghan and Harry, you might be able to invest like them… 

“You already have the younger generation voting with their dollars and their pounds, you know, all over the world when it comes to brands they select and choose from” – Prince Harry, interview with the Times.

Opportunities in Fintech

Fintech – short for Financial Technology – refers to the new tech that seeks to improve and automate the delivery and use of financial services. Ultimately, the aim is to help consumers better manage their finances and it’s an area that has become increasingly popular as our reliance on smartphones and computers has increased. 

As the world economy continues to recover, many believe that fintechs will continue to grow the market share they have won over the past 18 months – prompting an increase in investor appetite. 

One of many examples is American trading platform Robinhood, which Mick Dillion, co-manager of Brown Advisory Global Leaders discussed more on our podcast. 

Fintech is also one of the nine trends identified by Mid Wynd International – the others being automation; online services; emerging markets consumer; scientific equipment; healthcare costs; screen time (computers); low carbon world and high-quality assets.

Similarly, Guinness Global Innovators has identified nine core innovation themes, including artificial intelligence and big data, clean energy and sustainability and payments and FinTech. According to the team, payments and Fintech is driven by a number of structural changes* including “the move away from cash; the growth in e-commerce transactions; and the proliferation on of mobile technology.”

A more sector specific option is Jupiter Financial Opportunities, run by Guy de Blonay. Current themes in this portfolio include digitalisation, payment solutions, data analytics, security and the millennial/gen Z wealth transfer. The thematic approach in the process means the portfolio will invest in firms other than those which investors may consider traditional financial companies – technology companies that operate in the finance space, such as software firms, for example.

Funds looking to make an impact

The second side of the conversation is the opportunities in ethical and impact funds. FundCalibre has 14 responsible investment funds, with a range of mandates and often combining areas of fintech with responsible investing. The Artemis Positive Future fund, for example, looks at companies making a material positive impact on the world through either environmental or social improvements. These companies will sit at the axis of technological and sustainable change, looking to disrupt old economies to capture market share.

The Ninety One Global Environment fund on the other hand, invests in companies that are contributing to the decarbonisation of the world economy, while Liontrust Sustainable Future Managed invests for a cleaner, healthier and safer world. 

In a recent podcast, Mike Appleby, part of the investment team for the fund, told us why we need a healthy finance system if we’re going to be able to make the transition to a more sustainable world.

*Source: Guinness Global Innovators, Opportunities in Innovation, September 2020