Fund-vs-fund · NZ Fixed Interest
Mercer Macquarie NZ Fixed Interest Fund vs NZ Funds New Zealand and Australian Bonds
Both are NZ Fixed Interest 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 risk profile and portfolio composition. The NZ Funds New Zealand and Australian Bonds fund carries a risk indicator of 4, one step higher than the Mercer Macquarie NZ Fixed Interest Fund's indicator of 3, despite both sitting in the NZ Fixed Interest category. This divergence reflects meaningfully different underlying exposures: Mercer's fund concentrates its top five holdings entirely in New Zealand Government Bonds, ranging from 6.34% to 7.98% each, giving it a sovereign-heavy character. NZ Funds' portfolio, by contrast, leads with bank paper — Westpac, ANZ, Bank of New Zealand, and Kiwibank instruments — including a perpetual subordinated security (Kiwibank 4.93% Perpetual), which carries structural subordination risk absent from the government bond stack.
On fees, the gap is substantial. Mercer discloses an annual fund charge of 0.60%, while NZ Funds discloses 1.44% — a 140 basis point difference that compounds materially over time against any return differential. The five-year return figures are 0.71% per annum for Mercer and 0.97% for NZ Funds, though both figures are low in absolute terms and the period captured significant fixed income drawdowns. Mercer's fund is larger at approximately NZ$183.9 million versus NZ$144.7 million for NZ Funds. Growth asset allocations are minimal on both sides: 0.13% (Mercer) and 0.07% (NZ Funds).
Readers should verify all figures against each fund's current Product Disclosure Statement and latest Quarterly Fund Update on FMA Disclose before relying on this comparison.
Cached comparison generated 2026-05-21 from each fund's latest FMA Disclose QFU. Regenerated when the underlying facts change.
What's different at a glance
- Mercer Macquarie NZ Fixed Interest Fund charges 0.84% lower in annual fund charges (0.60% vs 1.44%).
- 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 14 nz fixed interest funds we've matched on Sorted Smart Investor. Mechanical only — no opinion, no forward-looking view.
Annual fund charge
Lower is better
Mercer
0.60%
Lower half of cohort
NZ Funds
1.44%
Highest 4% of cohort
5-year return p.a.
Past performance — not a predictor
Mercer
0.71%
Lower half over 5 years
NZ Funds
0.97%
Lower half over 5 years
Fund size
Larger = more stable, lower close-risk
Mercer
NZ$184m
Upper half by size
NZ Funds
NZ$145m
Lower half by size
| Metric | Mercer | NZ Funds | Lower / higher is |
|---|---|---|---|
| Annual fund charge | 0.60% | 1.44% | Lower is better |
| Risk indicator (1–7) | 3 | 4 | Higher = more volatility |
| 5-year return p.a. | 0.71% | 0.97% | Higher is better (past not future) |
| Fund size | NZ$184m | NZ$145m | Larger = more stable, lower close-risk |
| Growth / income split | 0% / 100% | 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 | InvestNow · 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 Macquarie NZ Fixed Interest Fund
The fund is an actively managed portfolio of fixed interest securities. It is a medium risk investment product, focusing predominantly on government bonds and corporate securities in the New Zealand market. Environmental, Social and Governance characteristics are integrated into our investment process. The fund aims to provide a Gross Return above the return of the Bloomberg NZBond Composite 0+ Yr Index on a rolling three-year basis.Full Mercer Mercer Macquarie NZ Fixed Interest Fund profile →
NZ Funds
NZ Funds New Zealand and Australian Bonds
The objective of the New Zealand and Australian Bonds fund is to generate gains by investing in income assets and other authorised assets with active management. The fund is anticipated to mainly own and trade New Zealand and Australian bonds over the minimum suggested timeframe.Full NZ Funds NZ Funds New Zealand and Australian Bonds profile →
Documents
Crawled directly from each manager's website. How we record provenance →
NZ Funds
Common questions
What's the difference between the Mercer Macquarie NZ Fixed Interest Fund and the NZ Funds New Zealand and Australian Bonds?
Which fund has lower fees, Mercer Macquarie NZ Fixed Interest Fund or NZ Funds New Zealand and Australian Bonds?
How do the 5-year returns compare?
Are both funds PIE-taxed in NZ?
Where can I read the official documents for these funds?
