Kernel March 2029 NZ Bond Fund Update
Fund update for the quarter ended 30 June 2025
What is the purpose of this update?
This document details the performance and fees of the Kernel March 2029 NZ Bond Fund, enabling comparison with other funds. Kernel Wealth Limited prepared this update in accordance with the Financial Markets Conduct Act 2013. This information is not audited and may be updated.
Description of this fund
The Kernel March 2029 NZ Bond Fund is designed to invest in New Zealand interest-bearing assets and is scheduled to terminate and fully distribute on or around 15 March 2027, its Fund Maturity Date.
Total value of the fund: $1,478,289
The date the fund started: 07 March 2024
How has the fund performed?
| Metric | Value |
|---|---|
| Annual return (after deductions for charges and tax) | 5.95% |
| Annual return (after deductions for charges but before tax) | 8.35% |
| Market index annual return (reflects no deduction for charges and tax) | 5.73% |
The market index annual return is based on the annual return of a combination of the Bloomberg NZ Bond Bank Bill Index and the Bloomberg NZ Bond Composite 0+ Yr Index. Further details are available in the 'Statement of Investment Policy and Objectives' document on the offer register at www.disclose-register.companiesoffice.govt.nz.
Annual Return Graph Description: The graph shows annual returns for the fund and the market index. The fund's annual returns (after charges and tax) were 5.83% for the year ending 31 March 2025, 5.67% for the year ending 31 March 2024, 5.84% for the year ending 31 March 2023, and 5.62% for the year ending 31 March 2022. The last bar represents the average annual return for the fund up to 30 June 2025. This data does not predict future performance. Returns are shown after tax at the highest prescribed investor rate (PIR) for an individual New Zealand resident; your tax may be lower.
What are the risks of investing?
Risk indicator for the Kernel March 2029 NZ Bond Fund: The risk indicator is rated from 1 (low risk) to 7 (high risk). This rating reflects the volatility of the fund's assets. Higher risk generally implies higher potential returns over time, but also greater fluctuations. For guidance on personal risk tolerance, consult financial advice or use the profiler at sorted.org.nz/tools/investor-profiler.
It is important to note that even the lowest risk category does not guarantee a risk-free investment, and other risks not captured by this rating may exist. The risk indicator is not a guarantee of future performance. It is based on 5 years of returns data up to 30 June 2025. While risk indicators are generally stable, they can change. The indicator will be updated in future fund updates. For more information on risks, refer to the Product Disclosure Statement - Diversified & Other Funds.
What fees are investors charged?
Investors in the Kernel March 2029 NZ Bond Fund incur fund charges. For the year ending 31 March 2025, these were:
| Charge Description | % per annum of fund's net asset value |
|---|---|
| Total fund charges | 0.50% |
| Total management and administration charges | 0.50% |
| Manager's basic fee | 0.50% |
| Other management and administration charges | 0.00% |
Investors are not charged individual action fees for specific actions or decisions, such as withdrawals. All fees include GST. Small differences in fees can significantly impact long-term investment growth.
Example of how this applies to an investor
An investor, Emma, who invested $10,000 on 1 July 2024 without further contributions, received a return of $835 (8.35%) after fund charges by 30 June 2025. Her total return after tax for the period was $595.
What does the fund invest in?
Actual investment mix
The fund's assets are allocated as follows: 6.70% in Cash and cash equivalents and 93.30% in New Zealand fixed interest.
Target investment mix
| Asset Category | Target asset mix |
|---|---|
| Cash and cash equivalents | 100% |
| New Zealand fixed interest | - |
| International fixed interest | - |
| Australasian equities | - |
| International equities | - |
| Listed property | - |
| Unlisted property | - |
| Commodities | - |
| Other | - |
Top 10 investments
| Name | % of fund's net asset value | Type | Country | Credit rating (if applicable) |
|---|---|---|---|---|
| Rabobank 5.31% 05/04/2029 | 14.14% | New Zealand fixed interest | New Zealand | AA |
| NZ LGFA 4.50% 15/05/2030 | 10.35% | New Zealand fixed interest | New Zealand | AAA |
| Toyota Finance NZ Ltd 5.69% 23/04/2029 | 7.88% | New Zealand fixed interest | New Zealand | A+ |
| Southland Building Society 6.14% 07/03/2029 | 7.13% | New Zealand fixed interest | New Zealand | BBB+ |
| Westpac 4.34% 24/09/2029 | 6.89% | New Zealand fixed interest | New Zealand | AA- |
| NZ LGFA 1.50% 20/04/2029 | 6.24% | New Zealand fixed interest | New Zealand | AAA |
| Bank of China Deposit | 5.82% | Cash and cash equivalents | New Zealand | A |
| Christchurch Intl Airport Ltd 5.18% 19/05/28 | 4.92% | New Zealand fixed interest | New Zealand | A- |
| Chorus 6.38% 06/12/2028 | 4.06% | New Zealand fixed interest | New Zealand | BBB |
| Kiwi Property Group 6.24% 27/09/2029 | 3.66% | New Zealand fixed interest | New Zealand | BBB+ |
The top 10 investments constitute 71.09% of the fund's net asset value. The fund is not hedged for currency.
Key personnel
The following individuals have significant influence on the fund's investment decisions:
| Name | Current position | Years | Months | Previous position | Years | Months |
|---|---|---|---|---|---|---|
| Dean Anderson | Chief Executive | 6 | 9 | Smartshares Product Manager, NZX | 4 | 4 |
| Stephen Upton | Chief Operating Officer | 6 | 0 | Smartshares Chief Operating Officer - NZX | 3 | 6 |
| Kerry McIntosh | Chairman | 6 | 0 | Operating Partner, Zino Ventures (current) | 7 | 4 |
| Vicki Dale | Investment Committee Member | 2 | 7 | Risk and Compliance Manager, Kernel Wealth (current) | 3 | 8 |
| Matthew Winton | Portfolio Manager | 3 | 1 | Europe Head of Linear Interest Rate Products, BNP Paribas, London | 7 | 0 |
Further information
Additional information, including the Product Disclosure Statement - Diversified & Other Funds, is available on the offer register at www.disclose-register.companiesoffice.govt.nz.
Notes
The risk indicator calculation uses market index returns and actual returns, as the fund has not been in existence for five years. Consequently, the risk indicator may offer a less reliable indication of the fund's potential future volatility. The risk indicator for this fund is based on 3 years and 9 months of market index returns.
