BNZ has turned up the equities dial to 11 with the launch of new high growth options in its KiwiSaver and retail YouWealth schemes.
The BNZ move follows recent high-octane fund releases by ASB and Simplicity targeting risk-aware investors in KiwiSaver and retail markets.
However, the new BNZ high growth funds target a 100 per cent exposure to shares compared to 95 per cent for the just-released ASB aggressive strategies and 80 per cent for the Simplicity options. Other managers including Milford and ANZ have launched high growth strategies over the last couple of years.
The average growth asset allocation in the Morningstar KiwiSaver diversified aggressive fund category sits at 90 per cent, according to the researcher’s September quarter report.
Global equities represent about two-thirds of the new BNZ fund with the remainder allocated to Australasian shares. The scheme has a passive exposure to international equities via State Street Global Advisors while splitting Australasian shares between two active managers – Mint and Castlepoint – and a tracker portfolio managed by the First Sentier Investors subsidiary, RealIndex.
Despite going all-in on equities, the BNZ high growth fund retains the same official risk indicator score (5 out of the maximum 7) as the standard 80/20 strategy – and the same price of 0.45 per cent.
Peter Forster, BNZ general manager wealth, said in a statement that the fee (which applies to most diversified funds in the bank-owned scheme range) “represents real value in a market where investors are frequently charged in excess of 1% for more aggressive funds”.
ASB, which follows a BlackRock-advised passive investment strategy, priced the new aggressive fund at 0.75 per cent, an increase of 0.05 per cent on its regular growth fund fees.
According to Morningstar, fees in the KiwiSAver aggressive fund category range from 0.25 per cent for the Kernel fund to 1.41 per cent for the InvestNow Generate Focused Growth fund.
BNZ also updated its KiwiSaver Navigator advice tool, built by OMNIMax, to accommodate the high growth option.
The bank-owned manager has about $6 billion in assets including $5 billion in its KiwiSaver scheme.