Fund-vs-fund · Diversified
Mercer Income Generator Fund vs NZ Funds Wealth Builder - Income Strategy
Both are Diversified funds available to NZ retail investors. Numbers below are sourced from the FMA Disclose register via Sorted Smart Investor and reflect the latest published quarterly fund updates.
Why these two differ
The most material structural difference between these two funds is their asset allocation, despite both carrying a risk indicator of 4 and sitting in the Diversified category. The Mercer Income Generator Fund holds 53.15% in growth assets, giving it meaningful equity exposure through positions such as Fisher & Paykel Healthcare (5.03%), Auckland International Airport (3.20%), and Infratil (2.66%). The NZ Funds Wealth Builder – Income Strategy holds just 0.07% in growth assets; its portfolio is dominated by short-dated bank bills from Westpac (collectively over 26%) and an ANZ term instrument, making it functionally a near-pure fixed income and cash vehicle in practice, despite its Diversified label.
This structural divergence is reflected in five-year returns: Mercer Income Generator returned 2.47% per annum against NZ Funds Income Strategy's 0.79% per annum over the same period. Fees are close but not identical — Mercer charges 1.28% annually versus NZ Funds at 1.20%. Fund sizes are similar, at NZD 20.74 million and NZD 20.36 million respectively. Both share the same risk indicator of 4, though the underlying composition suggests materially different sources of risk — equity and real-asset volatility for Mercer, and interest-rate and credit concentration for NZ Funds.
Neither fund is a KiwiSaver scheme fund based on the data provided, but investors holding either through a KiwiSaver scheme account should confirm scheme-level details separately. Verify all figures against each fund's current PDS and latest Quarterly Fund Update on FMA Disclose before relying on this summary.
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
- NZ Funds Wealth Builder - Income Strategy charges 0.08% lower in annual fund charges (1.20% vs 1.28%).
- 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 67 diversified funds we've matched on Sorted Smart Investor. Mechanical only — no opinion, no forward-looking view.
Annual fund charge
Lower is better
Mercer
1.28%
Highest 23% of cohort
NZ Funds
1.20%
Upper half of cohort
5-year return p.a.
Past performance — not a predictor
Mercer
2.47%
Lower half over 5 years
NZ Funds
0.79%
Bottom 4% over 5 years
Fund size
Larger = more stable, lower close-risk
Mercer
NZ$21m
Lower half by size
NZ Funds
NZ$20m
Lower half by size
| Metric | Mercer | NZ Funds | Lower / higher is |
|---|---|---|---|
| Annual fund charge | 1.28% | 1.20% | Lower is better |
| Risk indicator (1–7) | 4 | 4 | Higher = more volatility |
| 5-year return p.a. | 2.47% | 0.79% | Higher is better (past not future) |
| Fund size | NZ$21m | NZ$20m | Larger = more stable, lower close-risk |
| Growth / income split | 53% / 47% | 0% / 100% | 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. |
Portfolio overlap
How many top-10 positions both funds hold, and at what weight. Computed from each fund's most recently disclosed top-10 holdings — exact-name matched (Microsoft Corp. = Microsoft Corporation), with a Cash / Cash & Equivalents collapse rule.
What each fund says it does
Mercer
Mercer Income Generator Fund
The fund aims to provide a gross fixed monthly income in excess of bank deposit rates, along with a positive return on capital over the long term. To achieve this, the fund invests in a diversified mix of growth and defensive assets, with a focus on reliable income generation. Environmental, Social and Governance characteristics are integrated into the underlying investment managers’ investment processes. The fund aims to maximise the amount of the monthly distribution payments to investors by outperforming, over the medium term, the weighted average return of tFull Mercer Mercer Income Generator Fund profile →
NZ Funds
NZ Funds Wealth Builder - Income Strategy
The objective of the NZ Funds Wealth Builder - Income Strategy is to generate gains by investing in income assets and other authorised assets with active management. The fund is anticipated to own and trade New Zealand, Australian and international bonds over the minimum suggested timeframe.Full NZ Funds NZ Funds Wealth Builder - Income Strategy profile →
Documents
Crawled directly from each manager's website. How we record provenance →
NZ Funds
Common questions
What's the difference between the Mercer Income Generator Fund and the NZ Funds Wealth Builder - Income Strategy?
Which fund has lower fees, Mercer Income Generator Fund or NZ Funds Wealth Builder - Income Strategy?
How do the 5-year returns compare?
Are both funds PIE-taxed in NZ?
Where can I read the official documents for these funds?
