Fund-vs-fund · NZ Fixed Interest
Mercer Macquarie NZ Short Duration Fund vs Smart NZ Bond ETF
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 their risk profile relative to cost. The Smart NZ Bond ETF (Smartshares) carries a risk indicator of 3, one notch higher than the Mercer Macquarie NZ Short Duration Fund's risk indicator of 2, yet charges a lower annual fund fee of 0.54% against Mercer's 0.68%. Both sit within the NZ Fixed Interest category and share an identical growth assets allocation of 0.13%, so the divergence in risk indicator most likely reflects differences in portfolio duration and concentration rather than asset class mix.
On returns, Mercer's fund has delivered a five-year return of 1.87% per annum versus 1.29% for the Smartshares fund over the same period, a gap of 58 basis points that partially offsets the 14-basis-point fee advantage held by Smartshares. Fund size is broadly comparable — Smartshares at approximately NZD 60.9 million, Mercer at approximately NZD 47.0 million.
Portfolio construction differs meaningfully. Mercer's top holdings are more granular, with no single position exceeding 6.58%, and include a mix of NZ Government bonds and corporate issuers such as ANZ, GMT Bond Issuer, and Christchurch Airport. Smartshares' largest holding — an NZ Local Government Funding Agency bond — accounts for 13.08% of the portfolio, indicating higher single-issuer concentration at the top of the book, though the overall index-tracking structure may distribute this differently across the full portfolio.
Readers should verify all figures, including the latest fees, returns, and holdings, against each fund's current PDS and quarterly fund update on FMA Disclose before relying on any of this information.
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
- Smart NZ Bond ETF charges 0.14% lower in annual fund charges (0.54% vs 0.68%).
- 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
0.68%
Upper half of cohort
Smartshares
0.54%
Lower half of cohort
5-year return p.a.
Past performance — not a predictor
Mercer
1.87%
Top 4% over 5 years
Smartshares
1.43%
Upper half over 5 years
Fund size
Larger = more stable, lower close-risk
Mercer
NZ$47m
Lower half by size
Smartshares
NZ$58m
Lower half by size
| Metric | Mercer | Smartshares | Lower / higher is |
|---|---|---|---|
| Annual fund charge | 0.68% | 0.54% | Lower is better |
| Risk indicator (1–7) | 2 | 3 | Higher = more volatility |
| 5-year return p.a. | 1.87% | 1.43% | Higher is better (past not future) |
| Fund size | NZ$47m | NZ$58m | 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 | 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 Short Duration Fund
The fund is an actively managed portfolio of fixed interest securities. It is a low-risk investment product, focusing predominantly on corporate securities in the New Zealand and Australian market with a shorter average maturity than a standard fixed interest fund. Environmental, Social and Governance characteristics are integrated into our investment process. The fund aims to provide a Gross Return1 above the return of the Bloomberg NZBond Swaps 1–3 Year Index on a rolling three-year basis.Full Mercer Mercer Macquarie NZ Short Duration Fund profile →
Smartshares
Smart NZ Bond ETF
The Smart NZ Bond ETF is designed to provide a return (before tax, fees and other expenses) that outperforms the S&P/NZX A-Grade Corporate Bond Total Return Index over rolling three-year periods.Full Smartshares Smart NZ Bond ETF profile →
Documents
Crawled directly from each manager's website. How we record provenance →
Smartshares
Common questions
What's the difference between the Mercer Macquarie NZ Short Duration Fund and the Smart NZ Bond ETF?
Which fund has lower fees, Mercer Macquarie NZ Short Duration Fund or Smart NZ Bond ETF?
How do the 5-year returns compare?
Are both funds PIE-taxed in NZ?
Where can I read the official documents for these funds?
