Updated Reviewed monthly
Kernel vs Smartshares 2026
KernelKernel
3 listed funds · TER from 0.25% · founded 2019 · NZ-PIE
SmartsharesSmartshares
22+ funds (~36 total) · TER from 0.20% · 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 0.20% but offers 22+ funds covering sectors, regions, dividend strategies, property, and ESG that Kernel doesn't.
- Kernel: 3 listed funds, TER from 0.25%, founded 2019
- Smartshares: 22+ funds (~36 total), TER from 0.20%, founded 1996, owned by NZX
- Both PIE-taxed (max 28% PIR), FIF-exempt
- Kernel core funds (NZ20, KGM, 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) | 3 | 22 |
| Funds in total lineup | ~3 listed + direct-issued range | ~36 total |
| Lowest TER | 0.25% | 0.20% |
| Tax wrapper | PIE (max 28% PIR) | PIE (max 28% PIR) |
| NZ equity | NZ20 | FNZ, TNZ, MZY, DIV, NPF |
| Global equity | KGM (Global 100) | USF, USG, USS, ESG, EUF, APA, EMF |
| 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 APA, EM EMF)
- • 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 (up to 10%): Smartshares DIV for NZ dividend income
- • 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 0.20%). Smartshares has the wider lineup (22+ funds vs Kernel's 3), 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, KGM, KGH) all sit at 0.25% TER. Smartshares' cheapest fund is USF (US 500) at 0.20% 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 are bought direct on the Kernel platform with no ticket fee. They are unlisted PIE funds — not listed on the NZX and not available through share brokers like Sharesies or 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, Invest 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.
