Updated Reviewed monthly
Kernel vs Smartshares 2026
Kernel Kernel
4 listed funds · TER from 0.25% · founded 2019 · NZ-PIE
Smartshares Smartshares
17+ funds (~36 total) · TER from 0.34% · founded 1996 · NZ-PIE
NZ's two NZX-listed ETF issuers — the original (Smartshares) and the low-fee challenger (Kernel). Same PIE tax wrapper, very different fund lineups.
In 30 seconds: Kernel and Smartshares are New Zealand's two NZX-listed ETF issuers. Both wrap their funds as Portfolio Investment Entities (PIE) — distributions are taxed at your Prescribed Investor Rate (max 28%) and Foreign Investment Fund (FIF) rules do not apply to either. The substantive differences are fee level and lineup breadth: Kernel charges 0.25% TER on its core funds (cheapest in NZ); Smartshares charges from 0.34% but offers 17+ funds covering sectors, regions, dividend strategies, property, and ESG that Kernel doesn't.
- Kernel: 4 listed funds, TER from 0.25%, founded 2019
- Smartshares: 17+ funds (~36 total), TER from 0.34%, founded 1996, owned by NZX
- Both PIE-taxed (max 28% PIR), FIF-exempt
- Kernel core funds (NZ20, KGM, KSC, KGH) all sit at 0.25% TER
- Smartshares lineup covers sector (property, ESG), regional (Europe, Asia, EM), and dividend funds Kernel doesn't have
- Zero-fee buying: Kernel direct (Kernel funds); InvestNow (Smartshares funds)
Head-to-head comparison
| Kernel | Smartshares | |
|---|---|---|
| Founded | 2019 | 1996 |
| Ownership | Independent | NZX Limited subsidiary |
| NZX-listed ETFs (this page) | 4 | 17 |
| Funds in total lineup | ~4 listed + direct-issued range | ~36 total |
| Lowest TER | 0.25% | 0.34% |
| Tax wrapper | PIE (max 28% PIR) | PIE (max 28% PIR) |
| NZ equity | NZ20, KSC | FNZ, TNZ, MZY, DIV, NPF |
| Global equity | KGM (Global 100) | USF, USG, USS, ESG, WDV, EUF, ASF, EMG |
| Bonds | via direct-issued funds | NZB, NGB |
| Multi-asset | KGH (High Growth) | via Smart KiwiSaver |
| Property | — | NPF |
| ESG / sustainable | — | ESG |
| Australian exposure | — | AUS, AUD |
| Zero-fee direct platform | Kernel | InvestNow |
| KiwiSaver scheme | Kernel KiwiSaver | Smart KiwiSaver |
Where each issuer fits
Suited to Kernel
- • Cost-conscious core investing (NZ20, KGM)
- • Single-fund global solution (KGH multi-asset)
- • Direct-platform investing with zero ticket fees
- • Investors who want the lowest possible TER on NZ-PIE core
- • KiwiSaver via Kernel KiwiSaver (same underlying funds)
Suited to Smartshares
- • Sector exposure (NZ property NPF, ESG)
- • Regional exposure (Europe EUF, Asia ASF, EM EMG)
- • NZ-PIE S&P 500 (USF) — cheaper than direct VOO once you factor FIF
- • NZ dividend income (DIV) — highest yield in the lineup
- • Australian equity (AUS) or AU dividends (AUD)
These are characteristics of each issuer's lineup, not investment recommendations. Consult a licensed financial adviser about your specific circumstances.
A common NZ portfolio split
Many NZ investors don't choose between Kernel and Smartshares — they use both. A typical setup:
- • Core (60–80%): Kernel NZ20 + KGM (or just KGH) — cheap, broad, low-effort
- • NZ tilt (10–20%): Smartshares FNZ for broader NZ exposure than NZ20
- • Income (0–10%): Smartshares DIV for NZ dividend yield
- • Property (0–10%): Smartshares NPF for NZ commercial property
- • ESG (optional): Smartshares ESG for global sustainability tilt
Illustrative allocation only. Your portfolio should reflect your own goals, timeframe, and risk tolerance — consult a licensed financial adviser.
Frequently asked questions
Kernel vs Smartshares — which is better? ▾
Both are NZ-PIE ETF issuers. Kernel is cheaper on the funds it offers (lowest TER 0.25% vs Smartshares from 0.34%). Smartshares has the wider lineup (17+ funds vs Kernel's 4), covering sectors, regions, themes Kernel doesn't offer. For lowest-cost core NZ + global, Kernel wins. For specialised exposure (NZ property, ESG, dividend, regional), Smartshares wins.
Which is cheaper, Kernel or Smartshares? ▾
Kernel's flagship core funds (NZ20, KSC, KGM, KGH) all sit at 0.25% TER. Smartshares' cheapest fund is USF (US 500) at 0.34% TER; most others are in the 0.52%–0.75% range. On like-for-like exposure (e.g. Kernel NZ20 vs Smartshares FNZ), Kernel is roughly half the headline TER.
Are both Kernel and Smartshares PIE-taxed? ▾
Yes. Every NZX-listed ETF from both issuers is structured as a Portfolio Investment Entity (PIE), so distributions are taxed at your Prescribed Investor Rate (max 28%) and Foreign Investment Fund (FIF) rules do not apply.
Can I hold both Kernel and Smartshares funds? ▾
Yes — many NZ investors do exactly that. A common pattern is Kernel for core indices (NZ20 + KGM for cheap NZ + global) and Smartshares for sector / regional / property exposure where Kernel doesn't have a fund.
How do I buy Kernel funds? ▾
Kernel funds can be bought direct on the Kernel platform with no ticket fee. They're also listed on the NZX (NZ20, KSC, KGM, KGH are the four listed tickers) and available on Sharesies, BNZ Direct Broking, Jarden Direct and ASB Securities.
How do I buy Smartshares funds? ▾
Smartshares trades on the NZX. The cheapest option for buy-and-hold is InvestNow (zero commission on Smartshares). Sharesies, BNZ Direct Broking, Jarden Direct and ASB Securities also list them. Smart Investor (Smartshares' own platform) is another option.
Does Kernel offer KiwiSaver? ▾
Yes — Kernel KiwiSaver is a separate scheme built on Kernel's underlying index funds. Smartshares also offers Smart KiwiSaver, using the same underlying lineup. Both are PIE-taxed by default for KiwiSaver.
Kernel vs Smartshares for a new NZ investor? ▾
For a first-time NZ investor wanting a single low-cost core fund, Kernel's NZ20 + KGM combo (or just KGH on its own) is the simplest, cheapest starting point. For investors who want sector / property / regional / dividend / ESG exposure on top of a core, Smartshares fills the gaps.
