Australian exchange-traded fund (ETF) specialist, BetaShares, is poised to make its NZ debut with a range of five low-cost passive products due to go live in June.
BetaShares has long eyed-up the NZ market with the new fund range representing its first foray into offshore-domiciled products.
The five unlisted portfolio investment entity (PIE) funds will offer NZ investors a local tax-effective entry point into popular BetaShares indexed strategies covering Australian shares and bonds as well as global equities.
Betashares founder and chief, Alex Vynokur, said offering unlisted PIEs at first – to be available on investment platforms and direct to wholesale investors – rather than ETFs was a logical approach to the NZ market.
“We’re providing access to our leading investment strategies in a familiar vehicle that works for NZ investors given local tax settings. The launch of the PIE funds represents our initial step in building our business in New Zealand,” Vynokur said. “We are also considering opportunities to launch NZ-based ETFs in the future.”
He said BetaShares already had “strong relationships” with NZ financial advisers and institutions who had invested via the firm’s ASX-listed ETFs.
The Sydney-headquartered manager set up shop in Auckland in 2021, hiring Thom Bentley from the NZX-owned Smartshares to lead the local business. However, Bentley quit last August with BetaShares recruiting now to build a NZ team.
“To support further growth, we’re currently in the process of growing our local client services team to work from our Auckland office, and we may look to add to our footprint over time,” Vynokur said.
For the time-being, Betashares head of institutional and adviser Services, Vinnie Wadhera, is leading the NZ distribution effort
Wadhera said the manager would also be supporting NZ advisers with practice development tools offered in the Australian market.
“The Betashares practice development support services are directly compatible for NZ advice groups,” he said. “In fact, several leading advice firms [in NZ] already benefit from these support services namely the investment committee input, client value proposition workshop and other services.”
While BetaShares will now compete on equal terms with NZ passive shops such as Smartshares, Simplicity and Kernel, the launch product suite may be complementary in some asset classes with the full PIE menu including the:
- Global Sustainability Leaders Fund;
- Australian Sustainability Leaders Fund;
- Australia 200 Fund;
- Global Quality Leaders Fund; and,
- Australian Investment Grade Corporate Bond Fund (NZD hedged).
The BetaShares PIEs will use Link for registry, Trustees Executors as supervisors while BNP Paribas takes on custody and fund administration duties.
Vynokur is a director of the BetaShares NZ entity along with chief financial officer and co-founder of the Australian business, Jason Gellert, and Ed Sippel, head of Asia for US private equity firm, TA Associates.
TA is a cornerstone investor in BetaShares after buying out Korean manager, Mirae Asset, and some other smaller shareholders in 2021. The US private equity business also holds significant stakes in Russell Investments, Fisher Funds and the Apex Group (which bought MMC and Implemented Investment Solutions in NZ).
Since launching in 2010, BetaShares has grown rapidly to reach about A$27 billion under management across 80 ETFs as at April this year.