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Kernel’s new global funds set to energise local investment market

Investment advisors and wholesale investors now have access to three new funds which give their clients exposure to key international markets.

Monday, July 6th 2020, 7:43AM

Kernel has created and introduced the new products in response to client demand for low-cost index funds providing reduced-risk access to core asset allocations.

The new funds include the Global 100 Fund which provides exposure to the world’s largest brands; the Global Dividend Aristocrats Fund is designed to deliver reliable dividends; and the Global Infrastructure Fund gives investors access to some of the world’s largest infrastructure projects and operators.


Kernel founder and chief executive Dean Anderson says the company created the funds in direct response to customer demand. “The current climate for investors is challenging, but there is always opportunity in adversity,” he says. “We’ve engaged with our customers and have received a clear message that there is appetite for global exposure, particularly to blue-chip companies and sectors which will provide long-term expected growth, regardless of the inevitable impact of COVID-19.”

He therefore anticipates strong demand for these funds through intermediaries.
Anderson points out that historically low interest rates are compelling those holding cash to seek out better returns from their money. “Term deposits or cash in the bank have never been worse investments, a situation exacerbated by prevailing monetary policy in New Zealand and abroad,” he says.

This presents an opportunity for investment advisors, says Anderson, particularly when offering low-cost index funds with blue-chip credentials. “As with all our index funds, the three new products are designed with the lowest fees in the industry. Not only does this support optimised investment returns for your customers, but it also leaves space for margins.”

The Global 100 Fund is described as putting the ‘best of the best’ within reach of local advisors and their clients. The Global 100 is comprised of some of the world’s biggest and best-known companies, including Amazon, Nike, Nestle and Wal-Mart.

A ‘Dividend Aristocrat’ is a company which has increased or maintained its shareholder dividend payments for at least ten years in a row. “This is a select grouping of strong, global businesses with solid cashflow and earnings, which can be relied upon for the consistent delivery of a reliable income stream to investors,” explains Anderson.

By creating a fund comprised solely of these unusually stable and reliable performers, Kernel’s Global Dividend Aristocrats Fund is an attractive solution for those seeking regular returns from their investments.

The third new fund is designed to give investors access to some of the world’s largest infrastructure construction companies, operators, and projects. The sector is set for a boom over the coming decades on the back of government fiscal stimulus packages in response to the COVID-19 pandemic, combined with historically low interest rates.

Anderson says Kernel’s expansion into global funds will help energise the local intermediary market. “Our investors have told us they want access to global markets. These three new funds effectively double our offering to six funds, while giving advisers new options to help meet the needs of their clients.”

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AIA - Back My Build 6.19 - - -
AIA - Go Home Loans 8.74 7.14 6.75 6.39
ANZ 8.64 ▼7.45 ▼7.09 ▼6.95
ANZ Blueprint to Build 7.39 - - -
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ASB Bank 8.64 7.14 6.75 6.39
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BNZ - Classic - ▼6.85 ▼6.49 ▼6.39
BNZ - Green Home Loan top-ups - - - 1.00
BNZ - Mortgage One 8.69 - - -
BNZ - Rapid Repay 8.69 - - -
BNZ - Std, FlyBuys 8.69 ▼7.45 ▼7.09 ▼6.99
BNZ - TotalMoney 8.69 - - -
CFML Loans 9.45 - - -
China Construction Bank - 7.09 6.75 6.49
China Construction Bank Special - - - -
Co-operative Bank - First Home Special - ▼6.59 - -
Co-operative Bank - Owner Occ 8.40 ▼6.79 ▼6.49 ▼6.35
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Co-operative Bank - Standard 8.40 ▼7.29 ▼6.99 ▼6.85
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First Credit Union Special - 7.45 7.35 -
First Credit Union Standard 8.50 7.99 7.85 -
Heartland Bank - Online 7.99 ▼6.69 ▼6.35 ▼6.15
Heartland Bank - Reverse Mortgage - - - -
Heretaunga Building Society 8.90 7.60 7.40 -
HSBC Premier 8.59 - - -
HSBC Premier LVR > 80% - - - -
HSBC Special - - - -
ICBC 7.85 7.05 6.69 6.59
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Kainga Ora 8.64 7.74 7.35 6.99
Kainga Ora - First Home Buyer Special - - - -
Kiwibank 8.50 ▼7.75 ▼7.39 ▼7.19
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Pepper Money Advantage 10.49 - - -
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SBS Bank Special - 7.14 6.49 6.35
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TSB Bank 9.44 7.79 7.55 7.45
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Median 8.64 7.14 6.82 6.44

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