Betashares has launched its seventh NZ-domiciled fund, offering exposure to the local market but with a trans-Tasman twist.
The NZ Sustainability Leaders Fund follows an underlying index built by German benchmark specialist, Solactive, that “holds companies either listed on NZX or companies headquartered in NZ but listed on the ASX”.
For example, the ASX Kiwi connection clause repatriates Xero into the portfolio: Xero decamped to the Australian bourse from the NZX in 2018.
But the Solactive index also filters out “companies with material negative impacts on people, communities or the environment, including the avoidance of material exposure to the fossil fuel industry” while weighting more to firms identified as ‘sustainability leaders’.
The Sydney headquartered Betashares, headed by Alex Vynokur, released its first tranche of five portfolio investment entity (PIE) funds for the NZ market last June, adding a hedged version of a global equities strategy later in the year.
According to disclosure documents, the new NZ companies PIE carries an annual management fee of 0.59 per cent: BNP Paribas Securities Services is custodian and fund administrator; Link (now known as MUFG Pension & Market Services) providers registry; and, Trustees Executors has the supervisor gig.
Since launch last year the Betashares NZ PIE range has garnered about $150 million. The manager also landed a $65 million mandate from life insurer, AIA, in December 2023.
The Australian exchange-traded fund pioneer now has about A$44 billion under management spread across more than 100 products.
Last year Betashares, part-owned by US private equity firm TA Associates, also bought an Australian superannuation fund while launching a fee-free trading platform for its ETF range.
Also in November, the Australian arm of US-headquartered factor investment specialist Dimensional Fund Advisors (DFA) rolled out three global fixed interest products in PIE format for the NZ market.
In addition to a broad global bond fund, DFA released two PIEs targeting fixed income securities over respective two-year and five-year maturity periods.
Fees for the new fixed income products range from 0.25 per cent to 0.32 per cent (for the global bond strategy): BNP Paribas does custody and admin with Apex as registrar and Public Trust in the supervisor seat.
The just-released DFA funds – fronted by the Apex-owned fund-hosting house, FundRock NZ – join a suite of three PIEs that invest in global and Australian equities that have attracted about $330 million since first opening late in 2022.
A DFA-managed global bond PIE badged under the Consilium ‘Evidential’ brand (also charged at 0.32 per cent per annum) has accrued roughly $445 million post-launch in June 2022: after going live in April this year, the Evidential Sustainable Targeted Factor Fund (also managed by DFA) has pulled in more than $480 million.
Evidential uses a mix of service providers: Adminis as custodian and administrator of the global bond fund with Apex assuming those duties for the Targeted Factor Fund – Trustees Executors is the supervisor for both.
Meanwhile, Sharesies has created a managed cash PIE fund – its first product to be issued under a new investment scheme structure.
The in-house managed Sharesies PIE Save fund will invest “wholly in dollar deposits (cash) at AA- rated registered NZ-based banks”, according to the product disclosure statement.
While the share-trading, KiwiSaver scheme and financial product distribution firm already offers a bank-like savings account to members, the new cash fund includes the usual PIE tax discount for those on higher marginal rates.
Priced at 0.9 per cent, investors in the newly launched fund can redeem units one day after application.
Sharesies has appointed Apex as custodian for the PIE Save fund and Trustees Executors as supervisor.
In addition to managing the cash investments, the platform operator will also be responsible for “dealing with investors, maintaining records, processing transfers, marketing, accounting and performing other administration management duties as reasonably required by the Manager”.
The Sharesies Fund Scheme trust deed also opens up the possibility for further investment products to be released via the label.