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NZX pushing on with scale in its ETFs

After a wide ranging review of its operations NZX has decided that its ETF business is a core part of its operations.

Friday, November 24th 2017, 6:00AM 2 Comments

Recently its ETF business passed through the $2 billion funds under management mark, and there is a push to continue with growth. To do this NZX is using its own platforms, advisers and through fintech “channel innovators”, like Sharesis.

NZX has 23 ETFs, compared to 5 in three years ago. Funds under management have risen for $370 million to more than $2billion in those three years.

NZX chief executive Mark Peterson says the investor community is really starting to understand how ETFs play a role in portfolios.

He also says that millennials are investing in ETFs and some are choosing these funds over property investments.

Peterson says as the funds grow the company has more margin and some of this may be shared with investors.

“As we grow the margins grow. It may give us some opportunity to share some of that benefit back with the investors.”

“Our approach at the moment is push on with the scale and keep assessing the pricing as we get bigger.”

He says the international ETF scene, with its “extremely low fees” is quite different to New Zealand.

Beside retail distribution of ETFs the NZX is keen to also grow its superannuation business.

Currently there is around $26 billion in superannuation and NZX considers the addressable market to be around $9 billion in 100 entities.

“It is a sector we are experts in, with limited competitors.”

Tags: ETFs financial advisers fintech funds management investment NZX Smartshares superannuation Superlife

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Comments from our readers

On 24 November 2017 at 9:07 am Pragmatic said:
I would be interesting to understand the levels of organic growth (ex SuperLife) for these ETFs which are typically 2-3x more expensive than other gateways
On 28 November 2017 at 4:58 am henry Filth said:
"He says the international ETF scene, with its “extremely low fees” is quite different to New Zealand"

Indeed it is.

One wonders how many ETF investors have been driven offshore

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