Robo KiwiSaver start-up Kōura Wealth has set its pricing at a flat 0.63 per cent across all six underlying funds plus an annual member fee of $30.
A product disclosure statement (PDS) published last week, says the “charges cover the fees of Kōura, any external fund managers that we utilise, the Supervisor, the custodian and the administration manager”.
And while the stated fees also pay other scheme expenses such as accounting and audit services they exclude in-fund transaction and hedging costs with no buy/sell spread in place. If actual costs exceed the capped fees Kōura “will bear the cost”, the PDS says.
The standard fee rates for all asset classes, including cash, follow a growing trend to equalise, or at least flatten, the investment charges across risk profiles. Simplicity, for instance, offers a standard 0.31 per cent fee (plus $30 annual member charge) for its range of three KiwiSaver risk-weighted funds. BNZ recently slashed KiwiSaver fund costs (following a shift to an almost fully-passive approach) closely aligning higher risk and conservative portfolio fees.
As reported here in August, Kōura, founded by Rupert Carlyon, will invest into three US-listed BlackRock iShares exchange-traded funds for global equities while managing local asset classes in-house along with part-owner, Hobson Wealth.
Carlyon said the Kōura fees were “mid range” for passive funds but the products have been designed to minimise tax leakage to offshore jurisdictions.
The Kōura scheme was also scheduled to switch on its robo-advice service this week, he said, with the ribbons about to be cut on the previously password-protected website.
“We’ve got a marketing and social media campaign lined up,” Carlyon said.
Kōura’s robo-advice system would offer “true customer-focused robo-advice” rather than an enhanced retirement calculator, he said in August.
Warren Couillault, Hobson head, said Kōura – like the Fisher Funds and Generate KiwiSaver schemes he was also involved in launching – represented “an evolution to what’s already in the marketplace”.
“We’re bringing technology into the KiwiSaver space – helping make sure that all kiwis maximise their KiwiSavers’ potential,” Couillault said in a release. “Hobson Wealth Partners… is excited to be a part of this journey as we believe in the value of advice.”
The scheme uses MMC for administration and custody while Sargon NZ (formerly Heritage Trustees) is supervisor.
Elsewhere last week, Select Wealth – part of the Investor Services Group (ISG) family that also includes Clarity Funds Management, JMI Wealth and Devon Funds – lopped 5 basis points off fees for lower-value portfolios.
Under the new pricing schedule, Select discretionary investment management service (DIMS) has lowered the fee for sub $250,000 portfolios from 0.6 per cent to 0.55 per cent.
Select, which JMI Wealth (then known as JMIS) bought from the ASB-owned Sovereign in 2015, cut fees across higher portfolio sizes in 2017.
Andrew Kelleher, Select Wealth director, said the firm added further functionality as well as lowering fees since the 2015 purchase.
For example, Kelleher said Select had broadened the range of investment options and bolted on features such as online statements of advice.
Select was also investigating how the DIMS platform would operate under the imminent Financial Services Legislation Amendment Act (FSLAA) regime. FSLAA licensing opens up next month ahead of the regime’s two-year transitional phase due to start next June.
“We’re also very conscious at the moment of the changing regulatory environment for our advisers,” Kelleher said in a release. “Helen Robertson and Tahana Tippett from our Select Wealth team are working closely with financial advisers to understand how we can develop solutions that meet their requirements.”
Select uses the ASB-owned Aegis investment platform. Aegis is currently on the block with a number of parties, including other local fund administrators, understood to be scoping out the $15 billion platform.
In August, Hobson Wealth Partners announced it would depart Aegis next year, taking an estimated $3 billion in funds under administration to the NZX-owned Wealth Technologies system.