NZ Funds has been considered an expensive manager previously. So to go to zero fees was not something anyone expected.

Earlier this year eyes opened wide when Smartshares won default KiwiSaver status with a fund charging 20 basis points, even beating out the loudest fee manager Simplicity. (They too won default status with a fund charging 30 basis points).

NZ Funds is one of those firms which has flown under the radar for most of its existence. Only recently has it hit the headlines, and not for all the right reasons.

The manager was invested into cryptocurrency, got the timing spot on and pocketed some big fees. (Investors did well too).

Before that it was wrapped over the knuckle for advertising returns of 100% in a year. (See this earlier Wrap).

NZ Funds has always been a bit different and innovated in its own ways. Under its leadership now the market will see it trying different things.

It is being innovative and that can’t be a bad thing. Why just have another me-too manager? The market place has plenty of those already.

When we talked to NZ Funds this week it was impressive how open they were, and they provided substantial information to Good Returns about their zero-fee fund. If only other managers and insurers were so open

No doubt some advisers won’t like the latest move, but they should not be worried as NZ Funds is trying to get people to join KiwiSaver, and these potential members are unlikely to be advised clients for quite some time.

It’s well worth re-reading our story earlier this week as NZ Funds chief executive Michael Lang talked extensively about making Auckland a global financial hub.

It’s not a new idea – years ago Craig Stobo (ex BT) talked about this concept too. Lang says there is a small group working on this idea at the moment.
New Zealand, and Auckland in particular, could well be suited to becoming a global financial hub.

It’s the subject for a future Wrap piece from me – so stay tuned.