Fund-vs-fund · Diversified
Kernel Conservative FundvsNZ Funds Income Generator
Kernel Conservative Fund (fund size NZ$14.0 million, annual fund charge 0.25%) and NZ Funds Income Generator (fund size NZ$15.8 million, annual fund charge 1.67%) are both diversified managed funds, as shown on Sorted Smart Investor on 22 May 2026; NZ Funds Income Generator's 1-year return after fees and tax was 4.14% for the year to 31 March 2026, per its quarterly fund update filed on FMA Disclose.
How much do these two overlap?
They hold 1 of the same securities. If you held both, roughly 0.0% of your money would be in the same companies — so the diversification you get from holding the pair is smaller than holding two funds suggests.
| Shared holding | Kernel Conservative | NZ Funds | Min weight |
|---|---|---|---|
| Wesfarmers | 0.01% | 4.91% | 0.01% |
Min weight is the smaller of the two weightings — if you hold both funds, that is the floor of your exposure to that position. Direct holdings only: anything either fund holds through an underlying fund or ETF is not counted, so the real overlap can only be higher. From each fund's FMA Disclose full portfolio filing.
Why these two differ
The most material structural difference between these two diversified funds is their asset allocation. Kernel Conservative Fund holds 23.37% in growth assets, positioning it firmly at the defensive end of the diversified spectrum, while NZ Funds Income Generator reports 98.31% in growth assets — a figure that sits at the opposite extreme and, combined with its risk indicator of 4 versus Kernel's 3, signals meaningfully different return and volatility profiles despite both carrying the "Diversified" category label.
The fee gap is equally striking. Kernel Conservative Fund discloses an annual fund charge of 0.25%, compared with 1.67% for NZ Funds Income Generator — a difference of 1.42 percentage points that compounds materially over time. On five-year returns, only NZ Funds Income Generator discloses a figure in this snapshot (0.9% per annum); Kernel Conservative Fund's five-year return is not available in the current data, likely reflecting the fund's shorter operating history.
Portfolio construction also diverges sharply. Kernel's top holdings are dominated by fixed-income instruments — an iShares US aggregate bond ETF at 12.89% and several New Zealand government securities — consistent with its defensive allocation. NZ Funds Income Generator's top holdings are Australian and global equities plus Goldman Sachs futures exposure, consistent with its near-total growth-asset weighting.
Fund sizes are broadly comparable: NZD 13.97 million (Kernel) versus NZD 15.82 million (NZ Funds Income Generator). Neither fund is large by institutional standards.
Verify all figures against each fund's current product disclosure statement and latest quarterly fund update on FMA Disclose before relying on any of this information.
Comparison generated 2026-07-05 from each fund's FMA Disclose QFU facts as at that date. If the underlying facts change, this narrative is withheld until it is regenerated — the tables on this page always reflect the current data.
What's different at a glance
- Kernel Conservative Fund charges 1.42% lower in annual fund charges (0.25% vs 1.67%).
- Both are New Zealand PIE funds — investor tax is capped at the Prescribed Investor Rate (PIR), maximum 28%.
Where each fund sits in its cohort
Percentile rank vs all 68 diversified funds we've matched on Sorted Smart Investor. Mechanical only — no opinion, no forward-looking view.
Annual fund charge
Lower is better
Kernel
0.25%
Lowest 6% of cohort
NZ Funds
1.67%
Highest 2% of cohort
5-year return p.a.
Past performance — not a predictor
Kernel
—
—
NZ Funds
0.90%
Bottom 4% over 5 years
Fund size
Larger = more stable, lower close-risk
Kernel
NZ$14m
Lower half by size
NZ Funds
NZ$16m
Lower half by size
| Metric | Kernel | NZ Funds | Lower / higher is |
|---|---|---|---|
| Annual fund charge | 0.25% | 1.67% | Lower is better |
| Risk indicator (1–7) | 3 | 4 | Higher = more volatility |
| 5-year return p.a. | — | 0.90% | Higher is better (past not future) |
| Fund size | NZ$14m | NZ$16m | Larger = more stable, lower close-risk |
| Growth / income split | 23% / 77% | 98% / 2% | More growth = higher long-run return + volatility |
| NZ tax structure | PIE (PIR-capped) | PIE (PIR-capped) | PIE = simpler. FIF = annual return. |
| Currency hedging | — | — | Hedged smooths NZD/foreign FX moves at a small cost. |
| Responsible investment screening | No | No | Specific exclusions live in each fund's SIPO. |
| Available via | Direct | Direct | Platforms accepting retail subscriptions. |
What each fund says it does
Kernel
Kernel Conservative Fund
The Kernel Conservative Fund's investment objective is to provide a return (before tax, fees and expenses) that closely matches the return of the index of the reference portfolio. Investment strategy. Designed as a 30% growth / 70% income option by investing mainly in several of the other Kernel fundsFull Kernel Kernel Conservative Fund profile →
NZ Funds
NZ Funds Income Generator
The objective of the NZ Funds Income Generator is to provide a source of income by primarily investing in dividend paying shares and derivatives including options. The fund is anticipated to mainly own and trade New Zealand and Australian shares, derivatives including options over the minimum suggested timeframe.Full NZ Funds NZ Funds Income Generator profile →
Common questions
What's the difference between the Kernel Conservative Fund and the NZ Funds Income Generator?
Which fund has lower fees, Kernel Conservative Fund or NZ Funds Income Generator?
Are both funds PIE-taxed in NZ?
Where can I read the official documents for these funds?
