Smartshares vs Simplicity vs AMP vs Kernel – NZ Share Index Fund shootout

Index funds that invest in New Zealand shares are a fantastic investment to choose when beginning to invest, or for existing investors to use in their portfolios. They are easy to access and provide instant diversification in our familiar home market, with reasonable fees, and potentially come with tax advantages.

The hard part is deciding which NZ Share Index Fund to invest in – for example, What’s the difference between the Smartshares NZ Top 50 ETF, and NZ Mid Cap ETF?? To make things even harder, there are sometimes multiple ways to buy the same fund – for example, the Smartshares NZ Top 50 ETF can be bought from Smartshares directly, as well as InvestNow, Sharesies, ASB Securities, and SuperLife.

This article will take a look at the various NZ Share Index fund options, the different channels you can buy these funds through, their fees, and other considerations. Which one should you invest in?

Index Fund shootout articles:
– Smartshares vs Simplicity vs AMP vs Kernel – NZ Share Index Fund shootout (this article)
Smartshares vs Vanguard vs AMP – International Share Index Fund shootout

1. What’s on offer?

Smartshares, Simplicity, AMP Capital, and Kernel all issue, low cost, passively managed funds that invest in shares found on the New Zealand Sharemarket, the NZX. Let’s take a look at the options from each issuer, and the differences between all of them:

A. Smartshares

Smartshares is the biggest and most established player here. They’re an ETF Issuer owned by NZX, and offer five NZ Share Index Funds:

  • NZ Top 10 ETF (TNZ) – Invests in the 10 largest companies on the NZX
  • NZ Top 50 ETF (FNZ) – Invests in the 50 largest companies on the NZX, with each company only allowed to make up a maximum of ~5% of the fund’s value
  • NZ Mid Cap ETF (MDZ) – Invests in the 10th to 50th largest companies on the NZX, excluding Westpac and ANZ Banks
  • NZ Dividend ETF (DIV) – Invests in the 25 highest paying dividend companies out of the NZ Top 50
  • NZ Property ETF (NPF) – Invests in the 8 Real Estate Investment Trusts (REITs) listed on the NZX

B. Simplicity

Popular KiwiSaver provider Simplicity comes to the party with a non-KiwiSaver NZ Share Fund:

  • NZ Share Fund – Invests in the 50 largest companies on the NZX, excluding SkyCity

C. AMP Capital

Big investment fund manager AMP Capital offers two NZ index funds:

  • NZ Shares Index Fund – Invests in the 50 largest companies on the NZX
  • Australasian Property Index Fund – Invests in REITs listed on the NZX and ASX (Australia sharemarket)

D. Kernel

Kernel Wealth is a new player, having just launched about 2 months ago. They offer three different funds:

  • NZ 20 – Invests in the 20 largest companies on the NZX
  • NZ Level 9 – Invests in 23 of the smallest companies out of the NZX Top 50, plus 16 even smaller companies outside of the Top 50. Designed to complement the NZ 20 Fund, as together they give you exposure to most of the NZ sharemarket.
  • NZ Commercial Property – Invests in the 8 REITs listed on the NZX

What are the specific companies that each fund invests in?
For more information on the specific holdings and their weightings of each fund, check out this spreadsheet (opens in Google Sheets).

Funds by category

I have categorised these 11 funds into four categories, based on what they’re invested in. There are still differences between the funds in the same category, but all give you roughly the same type of investment exposure.

NZ Large Cap

The funds invest in the largest companies in the NZ market, and are what most people should invest in due to their broad market coverage and diversification (the funds below in bold cover the ‘Top 50’ companies in NZ). However, I’m not sure the Smartshares Top 10 ETF is worth investing in, as the coverage is way too narrow, investing in only 10 companies.

  • Smartshares NZ Top 10 ETF
  • Smartshares NZ Top 50 ETF
  • Simplicity NZ Share Fund
  • AMP NZ Shares Index Fund
  • Kernel NZ 20

NZ Mid Cap

Mid Cap funds don’t invest in the market’s largest companies, giving you more exposure to the smaller companies on the market, than you would get by investing in a Large Cap fund. Kernel’s Level 9 Fund even invests in 16 companies outside of the NZ Top 50, such as Hallenstein Glassons, Napier Port, and Serko.

  • Smartshares NZ Mid Cap ETF
  • Kernel NZ Level 9

NZ Dividend

Dividend funds invest in the market’s highest dividend paying companies, so are good if you’re investing to generate income. For example, the current yield of the NZ Dividend ETF is 5%, compared to 3.66% for the NZ Top 50 ETF. There is only one option in this category.

  • Smartshares NZ Dividend ETF

NZ Property

Property funds only invest in Real Estate Investment Trusts (REITs). REITs are companies that invest in commercial property (e.g. offices, shopping malls, and industrial buildings). Property funds are not an essential part of an investment portfolio (unless you want increased exposure to commercial property), as you already get exposure to REITs in the Large Cap, Mid Cap, and Dividend funds.

  • Smartshares NZ Property ETF
  • AMP Capital Australasian Property Index Fund
  • Kernel NZ Commercial Property

2. Through which channels can you invest in these funds?

There are multiple ways you can invest in the NZ Share Index Funds – the main ones being direct from the manager/issuer of the fund, through a fund platform, or through a broker. Let’s take a look at the options for each fund issuer:

A. Smartshares

Smartshares’ funds are the most widely available, being offered through four different channels:


You can buy Smartshares’ funds directly from Smartshares. They require a minimum initial investment of $500, and subsequent investments require $250 for one-off investments, or $50 for regular monthly investments.

Apply to invest directly through Smartshares

A limitation of investing direct through Smartshares is that they don’t provide any facility to sell/withdraw your investment. You would need to use a broker like ASB Securities or Direct Broking to sell your investment – this will be covered in more detail in section 5 of this article.

Another limitation is that investments made direct through Smartshares are only processed only once a month. When you make an investment order, your money is direct debited from your bank account on the 20th of the month, and the units of your investment are allocated to you on the 3rd of the following month. This process is a bit old school, especially as all other channels process your investment orders within a couple of days, rather than on a set day every month.

Fund Platforms

Fund Platform Sharesies gives you access to Smartshares’ NZ Share Index funds with a low minimum investment of just 1 cent! Unlike investing directly through Smartshares, Sharesies does allow you to sell your investment through their platform.

Keen to start building your investment portfolio with Sharesies? Sign up with this link, and you’ll get a bonus $5 in your account to invest!

The InvestNow platform also offers buying and selling of Smartshares funds, starting at $50 if you invest through a Regular Investment Plan, or $250 for one-off investments. The NZ Top 10 ETF is not available on InvestNow.


Smartshares’ funds are Exchange Traded Funds (ETFs). This means the funds are listed and traded on the sharemarket, just like shares of an ordinary company. You can use a broker like ASB Securities or Direct Broking to buy and sell these ETFs through the NZ sharemarket. This requires you to buy a minimum of 100 units for an initial investment into a fund – currently about $300 for the NZ Top 50 ETF.

NZ Top 50 ETF on Direct Broking


SuperLife doesn’t offer the actual Smartshares funds, instead offering funds that invest exclusively into Smartshares’ funds (which you can invest in with as little as $1). For example, the SuperLife NZ Top 50 Fund invests exclusively into the Smartshares NZ Top 50 ETF. It’s a fund within a fund!

There are a couple of major implications to having this ‘fund within a fund’ structure. Firstly, SuperLife charges different fees to Smartshares (see section 3). Secondly, SuperLife structures their funds as Multi-Rate PIEs, rather than Listed PIEs which has some tax implications (see section 5).

B. Simplicity


Investing direct with Simplicity is the only channel you can invest in their NZ Share Fund. The minimum initial investment is quite high at $1,000, but there is no minimum amount for subsequent contributions.

C. AMP Capital

Fund Platforms

InvestNow offers the AMP NZ Index Funds, also starting at $50 if you invest through a Regular Investment Plan, or $250 for one-off investments.

D. Kernel


Kernel’s funds can only be bought direct from Kernel themselves, through their own online platform. The minimum initial investment is $100, with subsequent contributions requiring a minimum of $10.

Kernel has its own online platform

3. What are the fees?

There are two types of fees you’ll pay when investing in these NZ Share Index Funds:

  • Fund Management Fee – A fee charged as a percentage of the amount you have invested in a fund
  • Channel Fee – A fee depending on what channel you use to invest in these funds such as an account fee, or brokerage fee

A. Smartshares

Fund Management Fees

Smartshares’ Fund Management Fees range from 0.50% to 0.60% per year, except when investing through SuperLife where the fees are all 0.49% per year.

FundRegular FeeSuperLife Fee
NZ Top 100.60%0.49%
NZ Top 500.50%0.49%
NZ Mid Cap0.60%0.49%
NZ Dividend0.54%0.49%
NZ Property0.54%0.49%

Channel Fees

  • Direct through Smartshares – A $30 Establishment fee applies if you’re investing directly through Smartshares for the first time.
  • SharesiesA subscription fee, ranging from $1.50 per month to $30 per year applies to balances above $50.
  • InvestNow – No other fees apply, apart from the above Fund Management Fees.
  • Brokers – Brokers charge brokerage fees every time you buy and sell shares. This fee can be quite expensive, starting at $15, so investing in Smartshares funds through brokers is probably not an ideal strategy for retail investors.
  • SuperLife – An account fee of $12 per year applies.
ASB Securities’ brokerage rates

In addition, spreads are charged whenever you buy or sell units in Smartshares’ funds. This is a small fee to cover the transaction costs of the fund, and for Smartshares, the spread depends on market conditions.

Buy or sell spreads are intended to cover the transaction costs of buying or selling the underlying assets of a fund, so that these costs are not borne by other investors in the fund

InvestNow – Buy/Sell Spreads

B. Simplicity

Fund Management Fees

Simplicity charges a very low 0.10% p.a. management fee for their NZ Share Fund.

NZ Share Fund0.10%

Channel Fees

Simplicity charges a membership fee of $20 per year. This fee also gives you access to Simplicity’s other investment funds like their Growth Fund and NZ Bond Fund.

C. AMP Capital

Fund Management Fees

AMP’s funds have lower Management Fees than their Smartshares equivalents:

NZ Shares Index Fund0.33%
Australasian Property Index Fund0.42%

Channel Fees

AMP Capital charges a 0.10% spread when buying or selling units in their funds. Otherwise no other account fees apply.

D. Kernel

Fund Management Fees

Kernel’s fund management fees are all a reasonable 0.39%. If your entire portfolio with Kernel is worth $25,000 or more, they give you a cash rebate of 0.10% (paid to you monthly), reducing the effective management fee to 0.29% p.a.

NZ 200.39%
NZ Level 90.39%
NZ Commercial Property0.39%

Channel Fees

Kernel charges a membership fee of $3 per month ($36 per year). This makes it a bit expensive for investors with small balances.

Kernel’s fees

4. Fee comparison

What is the cheapest fund and channel combination for each category of fund? In general:

  • Sharesies is the cheapest and only option for investing less than $50. Above $50, they are always the most expensive, as their subscription fee kicks in.
  • After $50, investing through InvestNow (particularly in AMP’s funds) is cheapest, mainly because the InvestNow channel does not attract any additional account fees.
  • The options that offer the cheapest Management Fees (Simplicity, SuperLife, Kernel) only become the cheapest option at higher balances, as they charge account fees.

NZ Large Cap

Even with its low 0.10% management fee, Simplicity isn’t the cheapest until you have a balance of $8,696 or more (because of the $20 account fee). For smaller balances, AMP’s NZ Shares Index Fund is the best.

Amount investedCheapest fund
$1 – $49Smartshares NZ Top 50 ETF (via Sharesies)
$50 – $8,696AMP NZ Shares Index Fund (InvestNow)
$8,696 and aboveSimplicity NZ Share Fund (direct)

NZ Mid Cap

Kernel’s Level 9 fund is a good deal for balances over $24,000.

Amount investedCheapest fund
$1 – $49Smartshares NZ Mid Cap ETF (via Sharesies)
$50 – $10,909Smartshares NZ Mid Cap ETF (via InvestNow)
$10,909 – $23,999Smartshares NZ Mid Cap ETF (via SuperLife)
$24,000 and aboveKernel NZ Level 9 (direct)

NZ Dividend

There is only one fund in the NZ Dividend category, and the cheapest channel to get it through depends on how much you’re investing.

Amount investedCheapest fund
$1 – $49Smartshares NZ Dividend ETF (via Sharesies)
$50 – $23,999Smartshares NZ Dividend ETF (via InvestNow)
$24,000 and aboveSmartshares NZ Dividend ETF (via SuperLife)

NZ Property

AMP’s property fund is the way to go, unless you are investing large amounts.

Amount investedCheapest fund
$1 – $49Smartshares NZ property ETF (via Sharesies)
$50 – $27,692AMP Aust. Property Index Fund (InvestNow)
$27,693 and aboveKernel NZ Commercial Property (direct)

Do your own fee comparison
Use this spreadsheet to calculate your annual fees for different options, depending on your balance. Requires you to be signed in to a Google account.

5. Other considerations

There are many other pros and cons to consider when deciding which NZ Share Index Fund to invest in, and which channel to buy it through:

Index Performance

Index Funds track (invest in) an index. An index is a collection of companies (and their weightings), along with a set of rules to decide which companies are in the index. With these rules, index funds are passively managed (and have lower fees!), as opposed to actively managed funds who have fund managers picking which shares to invest in. So what indexes do our NZ Share Index Funds follow, and what has their performance been like (as at 10 November 2019)? See table below:

A few interesting points:

  • The NZX 50 Portfolio Index outperformed the NZX 50 Index by 0.37% per year over 10 years, thanks to only allowing each company to make up a maximum of 5% of the index.
  • Kernel worked with S&P to design totally new indexes for their funds. For example, one reason the NZX 20 Index was created was because the top 20 consistently outperformed the top 50 over the last 10 years, by 1.48% per year.
  • The new Emerging Opportunities Index, tracked by Kernel’s Level 9 Fund has underperformed in recent years, but does provide a unique diversification into 16 companies outside the Top 50, which no other index fund invests in.
  • The NZX MidCap Index, has been the best performer over the last 10 years, outperforming the Top 50 by 2.02% per year.

Going forward each fund should follow the performance of their respective indexes closely (minus fees and tax), but remember this is past performance data, and is not a guarantee of how future performance will be.

Distributions (dividends)

The NZ Share Index Funds intend to pay distributions at the following frequency:

  • Smartshares – Half yearly, except SuperLife – No distributions
  • AMP Capital – Half yearly
  • Kernel – Quarterly
  • Simplicity – No distributions. Any dividends the fund receives are reflected in the fund’s unit price.

All distributions can be automatically reinvested into the fund (except when using Sharesies), or taken as a cash payment.


All Smartshares ETFs are Listed PIEs so are taxed at a fixed rate of 28%. All other funds (including SuperLife) are Multi-Rate PIEs (MRPs), so are taxed at your Prescribed Investor Rate (PIR). MRPs might be more suitable for those with a PIR lower than 28%.

Ownership of your investment

Investing direct through a fund provider/issuer (Smartshares, Simplicity, AMP, and Kernel), or through a broker, means your investment will be held under your own name. In the case of Smartshares, your investment will be held under your CSN (Common Shareholder Number).

If investing through InvestNow or Sharesies, your investment will be held in the name of a Custodian. If using SuperLife, your investment in the underlying Smartshares ETFs are held in SuperLife’s name. See my article What happens to your money if InvestNow or Sharesies go bust? for more info.

Ethical investing

Simplicity excludes SkyCity Entertainment from its NZ Share Fund for their involvement with gambling.

Selling Smartshares

If you’ve bought some funds direct from Smartshares, they don’t offer a facility to sell your investment – so what are your options for getting your money out?

  1. Use a broker like ASB Securities or Direct Broking to sell your shares. There is more detail in this The Smart and Lazy blog post or this Happy Saver blog post. The Smart and Lazy suggests opening a brokerage account ASAP (it’s free to do so), so that you’re ready to sell your investment at anytime.
  2. Make an off-market transfer of your shares to InvestNow. Then sell your shares via InvestNow. This involves more work than going through a broker, but you won’t need to pay brokerage costs using this method. You cannot do this with the NZ Top 10 ETF as this fund is not available on InvestNow.


It is pretty hard to choose which NZ Share Index Fund to invest in given there is so much choice. My opinion is that a NZ Large Cap fund, specifically a ‘Top 50’ fund, is the way to go as these funds provide the broadest coverage of NZ market. Simplicity’s NZ Share Fund with an ultra low 0.10% fee is hard to beat if you are investing over $13,000.

Otherwise, the InvestNow channel is a great all round option, especially for investing smaller amounts. They offer both Smartshares and AMP funds, as well as international funds, making it easier to build a diversified portfolio under one roof. The AMP NZ Shares Index Fund is probably the best option here.

New provider Kernel is promising. They are not the cheapest, particularly for smaller investments, but I like how they’re providing something new by investing in companies outside the NZ Top 50. I enjoyed the NZ Everyday Investor Podcast episode featuring Kernel’s founder, Dean Anderson, where they discussed plans to expand their offerings – I eagerly await what they have to offer next.

Lastly, do you need to invest in a Mid Cap, Dividend, or Property fund if you’ve already invested in a ‘Top 50’ fund? Probably not, as they don’t provide much further diversification, given the ‘Top 50’ funds contain the same companies – there is a lot of overlap between the funds. It is probably better to buy international funds to diversify your portfolio geographically – a comparison between the different International Share Index Funds will be coming soon!

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The content of this article is based on my personal opinion and should not be considered financial advice. The information should never be used without first assessing your own personal and financial situation, and conducting your own research. You may wish to consult with an authorised financial adviser before making any investment decisions.