Author Topic: Buying Index Funds from New Zealand  (Read 4481 times)

Jeffro80

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Buying Index Funds from New Zealand
« on: November 21, 2013, 03:19:06 PM »
I would like to purchase a world Index fund such as the Vanguard® Index International Shares Fund. Does anyone have any advice on how to do this from New Zealand? At the moment my global shares are actively managed and I would like to move these to passive. There is an option through their wholesale division but the $500,000 minimum purchase is way beyond what I have available.

Are there any other options for purchasing index global funds? How hard (and expensive) is it to go through the ASX through a broker such as ASB?

Thanks for any advice.

lysistrata

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Re: Buying Index Funds from New Zealand
« Reply #1 on: November 21, 2013, 05:15:23 PM »
Hi Jeffro80

I don't know if this is useful to you or not, but have you looked at buying global index through Superlife? You can get passive funds through them and choose your own allocation, so simply allocate to the global funds. The fees are pretty hard to beat over here.

I'm pretty new to investing so not sure if this is what you're after, but I've got my passive funds through Superlife and I've been very happy with them. I'm looking at Smartshares next for the ASX.

the lorax

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Re: Buying Index Funds from New Zealand
« Reply #2 on: November 21, 2013, 11:00:59 PM »
Hi
It's easy enough to buy Vanguard and iShares etc funds that are listed on the ASX. ASB and Direct Brokers (might have name wrong there) both would charge minimum of ~$40 a trade or 3%. You need to calculate Foreign Investment Fund tax once you get over $50K - the IRD website has a calculator. Superlife sort that out for you and do their funds as PIEs so you pay slightly lower tax but their management fees are higher than what you pay if you head directly for Vanguard so pros and cons really!

Silverbumble

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Re: Buying Index Funds from New Zealand
« Reply #3 on: November 22, 2013, 04:17:00 PM »
Hi Jeff, im based in Wellington.  I called the Stock Exchange and discussed their current "SmartShares" which are index funds for NZ and Australia at various levels.  They said they are working on an international index fund and might have more to offer next year.    Fingers crossed.   

Aught3

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Re: Buying Index Funds from New Zealand
« Reply #4 on: November 22, 2013, 08:55:56 PM »
Hi Jeff, im based in Wellington.  I called the Stock Exchange and discussed their current "SmartShares" which are index funds for NZ and Australia at various levels.  They said they are working on an international index fund and might have more to offer next year.    Fingers crossed.
Huh, they were supposed to be getting the new funds out this year. I guess it turned out to be harder than they thought.

gooki

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Re: Buying Index Funds from New Zealand
« Reply #5 on: November 23, 2013, 01:16:25 AM »
A shame smartshares fee structure is high for an entirely passive fund. My rough maths determined it was only worthwhile if your investing 100k or less. At higher amounts you were better off buying the market and doing your own rebalancing.

the lorax

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Re: Buying Index Funds from New Zealand
« Reply #6 on: November 23, 2013, 01:39:50 PM »
Hi Gooki
could you talk us through how you look at those calculations please? The reason I ask is because I've been trying to figure out if we are better off investing directly in ETF funds through the ASX (which have low fees, but aren't set up as PIE funds and once you hit the $50K threshold you pay tax on the cap gains as well as dividends as far as I understand it) and investing via Superlife (whose funds are PIE funds so lower tax but have higher annual fees). We'd be investing every 2-3 months once we've paid the mortgage off but would be under $100K for a while yet!

I have a small amount with Smartshares - they make it very easy to invest and it's great to have monthly investing and dividend reinvestment (most of the ETFs on the ASX don't have that) but they do have quite high fees and the range is so limited currently.

gooki

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Re: Buying Index Funds from New Zealand
« Reply #7 on: November 24, 2013, 01:30:05 AM »
I should have been clearer, I talking about SmartTENZ. With a 0.60% management fee, on $100,000 That's $600 a year, which is roughly 20-30 manual trades a year. Which should be plenty to invest direct and rebalance once or twice a year.

Jeffro80

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Re: Buying Index Funds from New Zealand
« Reply #8 on: February 15, 2014, 07:05:42 PM »
Thanks for the responses. I've started investing in the smartFONZ and smartOZZY funds. I'll be gradually selling out of my Fisher Funds NZ managed fund and putting the proceeds into these instead.

I will look I to the Superlife fund. Hopefully Smartshares will get their overseas equities fund running soon so I can sell out of my current actively managed funds.