Insight
Active vs index NZ managed funds — what they cost, what they returned
We classified 285 NZ retail managed funds with reported fees into active (227) and index (58) using a manager-list + name-token rule. Fees and 5-year returns are taken from each fund's most recent FMA Quarterly Fund Update. No opinion, no forward-looking view — just the numbers.
Median active fund charge
0.99%
across 227 active funds
Median index fund charge
0.42%
across 58 index funds
Fee gap (median)
0.58%
active − index, percentage points p.a.
What this means in dollars
On a NZ$100,000 balance, the median fee gap costs an active-fund investor about NZ$580 p.a. in fund charges before compounding. Over 10 years, mechanically compounding the gap (assuming flat returns) widens it to about NZ$5954. The active fund still wins if its net-of-fees performance beats the index by more than the gap.
Per-category breakdown
Median values across all funds we matched in each category. — means we don't have enough funds of that style in that category to show a median (or the fund hasn't reported the metric).
| Category | Active funds | Index funds | Fee gap | 5y return gap | ||
|---|---|---|---|---|---|---|
| # | med fee | # | med fee | act − idx | act − idx | |
| Diversified Funds | 59 | 1.02% | 8 | 0.25% | +0.77% | -1.59% |
| Australasian Equities | 44 | 1.07% | 14 | 0.54% | +0.53% | -0.07% |
| International Equities | 56 | 0.95% | 26 | 0.47% | +0.48% | -3.03% |
| New Zealand Fixed Interest | 12 | 0.66% | 2 | 0.32% | +0.34% | +0.15% |
| International Fixed Interest | 27 | 0.76% | 4 | 0.36% | +0.40% | -0.04% |
| Listed Property | 13 | 1.05% | 2 | 0.54% | +0.51% | -0.43% |
| Cash and Cash Equivalents | 4 | 0.44% | 1 | 0.12% | +0.32% | — |
| Other | 7 | 1.08% | 1 | 0.55% | +0.53% | — |
Read the gap columns carefully. A positive fee gap means active funds in this category typically charge more than index funds. A positive return gap means active funds have also outperformed over 5 years (after fees, before tax) — sometimes the case in less-efficient categories. A negative number means the opposite. Past performance is not a reliable indicator of future returns.
All index funds we tracked
Sorted by lowest annual fund charge. Each row links through to the fund's own page.
Methodology
- Classification. A fund is "index" if its manager is Vanguard, Smartshares, Foundation Series or Simplicity (entirely passive in NZ retail), or its fund name contains "Index", "Passive" or "Tracker". Everything else is "active". Smart-beta and enhanced-indexing funds default to active.
- Fee field. "Annual fund charge" is the standardised total cost ratio used in FMA Quarterly Fund Updates — a like-for-like number across all NZ retail funds. It includes management fees, admin costs and indirect fund expenses, but excludes performance fees from prior years.
- Return field. "5-year return p.a." is the after-fees-after-tax annualised return at the highest PIR (28%), as published in the Quarterly Fund Update. Source: FMA Disclose register, mirrored on Sorted Smart Investor.
- Sample. Of the 289 retail funds tracked on this site, 285 have reported fees we could match. Funds in `pending-ingestion` status are excluded until their first QFU is parsed.
- What this is not. Not a recommendation. Not a forecast. The 5-year window is a backward-looking observation that depends on the specific market regime — it will look different in 12 months. Read each fund's current PDS before investing.
Sources
Frequently asked questions
What counts as an "index" fund in this analysis?
A fund is classified as index if (a) its manager runs a wholly passive NZ retail offering — Vanguard, Smartshares, Foundation Series, Simplicity — or (b) the fund name contains "Index", "Passive" or "Tracker". Everything else is treated as active. Edge cases (smart-beta, enhanced indexing) default to active until manually overridden.
Where do the fee and return numbers come from?
Each fund's "annual fund charge" and 5-year-after-fees-after-tax return are mirrored from the FMA Disclose register via Sorted Smart Investor. We do not republish numbers we cannot trace to a primary source. The Quarterly Fund Update (QFU) on Disclose is the canonical document.
Does a lower index-fund fee mean it always outperforms an active fund?
No. Net 5-year returns depend on market conditions, manager skill (or its absence), tracking error, currency exposure and tax structure. The 5-year return median in this table is what happened over a specific window, not a forecast. Past performance is not a reliable indicator of future returns.
Can I see the underlying holdings of the funds in this comparison?
Yes — every fund's top-10 holdings are shown on its individual page (linked from each row), pulled from the most recent FMA-mandated Quarterly Fund Update where available.
Is this financial advice?
No. ManagedFundsNZ is not licensed to provide financial advice. This page reports mechanical numbers from public disclosure data so you can do your own comparison. For personalised guidance, talk to a licensed financial adviser.
ManagedFundsNZ is not a licensed financial adviser. This page reports mechanical comparisons of public disclosure data; it is not personalised advice. Past performance is not a reliable indicator of future returns. Always read each fund's current Product Disclosure Statement and consider speaking to a licensed financial adviser before investing.