Amidst the evolving investment landscape shaped by current interest rates, Kernel has introduced four new bond funds to its fund line-up: The Kernel US Bond Fund, NZ Bond Fund, March 2027 NZ Maturity Date Bond Fund and March 2029 NZ Maturity Date Bond Fund.
"As the market dynamics have shifted, with a historic rise in interest rates, bonds are once again emerging as an attractive investment. But this is only the start of many innovations planned for 2024, including the work with advisers to help leverage technology to scale their business,” Kernel founder and chief executive Dean Anderson says.
The Kernel US Bond Fund is already accessible to advisers and wholesale investors. It offers exposure to the largest bond market with a competitive fund management fee of 0.30% annually.
This index-tracking fund provides daily liquidity, quarterly distributions and a PIE structure. Therefore, establishing it as a market-leading option for investors seeking an exposure to the US bond market.
Launching in the new year, the Kernel NZ Bond Fund will be an actively managed fund designed for those seeking exposure to the New Zealand bond market. Aiming to surpass the return of the Bloomberg NZ Bond Composite 0+ Year Index, this fund boasts a fund management fee of 0.40%.
Additionally, debuting in the new year with a fund management fee of 0.50%, the Kernel March 2027 NZ Maturity Date Bond Fund and Kernel March 2029 NZ Maturity Date Bond Fund present a unique approach to bond investing in the New Zealand market.
These funds aim to generate returns comparable to investment-grade bonds with set maturity dates in March 2027 and March 2029, respectively.
“These new funds are tailored to meet the diverse needs of investors, providing them with tax-efficient structures, set maturity dates and actively managed options. This is a great new solution that will result in better outcomes for both advisers and their clients," Anderson says.
The funds are said to be a result of working closely with the market and financial advisers to understand the challenges they face, the time spent on managing direct bonds for clients and the outcomes they are trying to deliver.
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