Sharesies KiwiSaver to offer self-select for US shares

Sharesies KiwiSaver is ramping up exposure to the US, and will allow members to select individual US stocks, as well as a new Sharesies US500 fund based on the Vanguard S&P 500 ETF (VOO).

Tuesday, October 8th 2024, 1:57PM

by Andrea Malcolm

From December, Sharesies KiwiSaver members will be able to choose to invest in more than 50 individual US stocks, including Meta and Apple.

Guardrails will still apply, including a 5% limit when investing in a single stock, and at least 50% of an investor’s portfolio must be in base funds. KiwiSaver members will pay tax at their prescribed investor rate (PIR) for investing in the US options.

Sharesies says its KiwiSaver, which launched in beta December 2022, now has $230 million in funds under management and more than 8000 members.

In November last year, the online investment platform began offering members the ability to self-select from five New Zealand-managed base funds (increasing to six this year), and 90-plus NZX stocks. In September, it began allowing members to combine multiple base funds, provided they totaled at least 50% of their investment plan.

Around 44% of Sharesies KiwiSaver members now have some form of self-select, says co-CEO and co-founder Leighton Roberts.

“Using our investment plan builder to see what might be possible has been a game changer. The ability to get a picture of your overall portfolio, including a personalised risk score and fee estimate, helps lead to a more informed choice.”

He says total KiwiSaver funds under management are now over $111 billion and will only continue to grow, having doubled in the last five years alone. “Our expansion into US markets reflects the level of ambition we have for our KiwiSaver scheme and

KiwiSaver more generally as a vehicle for growing Aotearoa’s wealth.”

VOO exposure

The Sharesies US500 fund will charge 0.09% annual fund charge and a 0.50% currency exchange fee on buys or sells. KiwiSaver members will be able to invest as much or as little as they like in the fund.

“Being able to invest in the US markets using your KiwiSaver is one of our most requested features, “says Roberts.

“While past performance doesn’t indicate future returns, Vanguard data shows that over the past decade an S&P 500 ETF has delivered an annual return of nearly 13% through a range of market conditions. So for some investors this may be a great option.”

According to the 2024 annual KiwiSaver report from Melville Jessup Weaver, among the smaller KiwiSaver providers, Sharesies (which started from a near zero base) and Kernel were the big movers in terms of asset growth in the year ending 31 March 2024. Sharesies had $148m FUM and Kernel had $162m. When considering percentage gains, Sharesies grew more than 16,000%. Along with Kernel, Kōura, Aurora and KiwiWRAP – it more than doubled its assets.

Retail marketing play

As part of the US markets offer, Sharesies is running a competition for its customers to go in the draw to win a trip for two to New York to see the US markets in action. This includes flights, five nights accommodation, spending money, and a visit to the New York Stock Exchange.

Tags: Sharesies