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Kōura Wealth KiwiSaver Scheme Details

There's a lot more to selecting a KiwiSaver fund than just checking past returns and fees. If your hard-earned money is invested in KiwiSaver, you need to ask the important questions to understand where and how that money is invested.

What questions are important to Investors?

Note: The following information is taken from Kōura Kiwisaver Scheme's own website, fund updates, and the product disclosure statement published on 9 March 2020.

Who is Kōura Wealth?

Facts & History of the KiwiSaver provider

History

Kōura Wealth was established in 2007. They are an all-digital advisory firm.  

Why are they called Kōura? Firstly, They fully plan on being the KiwiSaver gold standard scheme.

But this isn’t just any kind of gold they are talking about here, it’s KiwiSaver gold. That’s why they looked for a uniquely New Zealand way to express this word. And what better way to demonstrate our proud Kiwi heritage than using Te Reo Māori?

So they named their company kōura. You may recognise kōura as a freshwater crayfish, but it also translates to gold and goal and has wider connotations of wealth and abundance – all cornerstones of their company.

✅   New Zealand Based Provider

 

History

 

 

Who are the people looking after my money?

The investment team, structure and their alignment with clients

The Investment team

Rupert Carlyon - Founder, Managing Director

Rupert has worked in financial service roles his entire career – starting at global investment bank UBS, where he had a slew of roles in London and Auckland.
Returning to New Zealand in 2014, Rupert was disappointed to see the KiwiSaver market had not moved on since he left. Seven years on, New Zealanders were still being given the same stock-standard, three-fund offering and he could see that KiwiSaver was not really working for everyone.

So he began to look internationally, at companies and technologies that were doing retirement investing right. kōura is the result - a way to give kiwis access to the technology and products to help them achieve their financial goals.

Warren Couillault - Chairman

Warren is New Zealand’s KiwiSaver guru. And when you’re running a KiwiSaver company, it’s pretty great to have him on board. Warren was a crucial member of the team that created the Fisher Funds KiwiSaver scheme in 2007 and the award-winning Generate KiwiSaver scheme in 2011.

Now the CEO of Hobson Wealth Partners, one of New Zealand’s largest wealth managers and a key strategic partner of ours, Warren is also the Chairman of kōura and sits on our Investment Committee. His role is to help steer the team, making sure they continue to deliver great financial outcomes for you.

David Moore - Director

David spent 30 years treading trading floors in London. On moving to New Zealand, he decided to pour that energy and knowledge into being a top financial advisor.

David’s analytical nous and integral understanding of the financial advice game made him a perfect choice for kōura. He’s a Chair of the Investment Committee, and as an Authorised Financial Advisor has final approval of our digital advice models.

Anna Scott - Director

Anna is an Executive Director and Chief Operating Officer at Hobson Wealth. She has been responsible for transforming Hobson into a modern technology-focused wealth management firm after its separation from Macquarie. Anna’s operational focused skillset and knowledge have paved the way for kōura’s unique technology-based customer-centric model.

Prior to Hobson, Anna spent her career working for large financial institutions in New Zealand and offshore – chasing down great customer outcomes and delivering them. We’re pretty stoked she’s now doing this for you and us.

How is the Investment Team Structured?

The Manager of the Scheme is Kōura Wealth Limited, a company incorporated in New Zealand under the Companies Act 1993 on 20 February 2019. Kōura manages the investments of, and administers, the Scheme. Kōura is 100% New Zealand owned, we are very proud of our Kiwi heritage. 

Details of the directors of Kōura are set above.

Kōura is licenced to act as managed investment scheme manager by the Financial Markets Authority (the FMA) under the FMC Act. Kōura also holds a digital-advice exemption allowing it to offer its clients personalised digital advice.

The Manager’s  functions

As the Manager of the Scheme they:

  •  Offer and issue Units in the Funds
  •  Manage the Funds in the Scheme and their investments; and
  •  Are responsible for administering the Scheme

Below is a link to a list of all their documents:

 

Kōura Documents List  

 

The Schemes Objective 

The Kōura KiwiSaver Scheme has been designed and set up to help people achieve better outcomes for their KiwiSaver. Fundamentally, they believe that KiwiSaver is a complicated product and investors need help and advice to help them achieve their objectives. They do this through a differentiated fund structure and digital advice. 

The Kōura Funds

You can choose to invest in any of the following investment funds (Funds):

  • US Equities Fund
  • Rest of World Equities Fund
  • Emerging Markets Equities Fund
  • New Zealand Equities Fund
  • Fixed Interest Fund
  • Cash Fund

All of the Funds are investment options under the Scheme. You will be allocated units in the Funds that you select when you sign up for the Scheme. The Scheme is governed by a trust deed dated 16 August 2019 (Governing Document), and the Funds are invested in according to the SIPO. 

You can get an electronic copy of the Governing Document and SIPO from the scheme register on the Disclose website below:

 

Governing Doc & SIPO 

 

Investment & Strategy Objective

The objective of the Scheme is to provide investors the ability to create an appropriate portfolio by investing in a range of funds. The investment objectives and strategies for each of Kōura’s 6 funds are set out in Schedules 1- 6 of their SIPO together with the market indices used to measure the performance of the assets each fund invests in.

For more information on their SIPO, please visit the link below:

 

SIPO  

 

How do I know my money is safe?

Governance & Compliance processes

All KiwiSaver Scheme Providers must ensure they meet regulatory standards and act with customer interests in mind.

KiwiSaver Scheme Managers must exercise care, diligence and skill in the investment of scheme assets, and act in accordance with the stated investment policy and objectives. The FMA monitors that KiwiSaver Schemes are compliant with their obligations. Additionally, KiwiSaver Scheme Trustees also have a responsibility as front-line supervisors for monitoring the management and administration of these schemes.

Kōura Supervisor & Custodian

Kōura appoints Public Trust as their independent supervisor and custodian.

Public Trust of New Zealand was a government-appointed corporation sole providing trustee services to those unwilling to use private services or required by the courts or legislation to use the Public Trustee. From 2001 Public Trust ceased to be a corporation, adopting a structure similar to a company as a Crown entity, and was renamed Public Trust. It administers 50,000 estates, trusts, funds and agencies. They supervise seven KiwiSaver Providers with approximately $13.5 billion assets under management.

A supervisor is a licensed entity independent of a KiwiSaver scheme provider that supervises the provider’s management of the scheme. KiwiSaver schemes are trusts, and (except for restricted KiwiSaver schemes) the terms of the trust deed states that the supervisor (or another custodian) must hold all contributions and investments in trust for the investors.

A custodian plays a key role in protecting your investments. They hold your money and investments (i.e. keep custody of them) on your behalf. So they are the legal holder of your assets while you are the beneficial and ultimate owner.

Below you will find a link to The Public Trust:

 

Public Trust

 

Investment Policies

  • Currency Hedging: Hedging involves removing some or all of the foreign currency risk implicit in owning international assets. Where a fund has foreign currency exposure, the hedging policy for that fund is set out in Schedules 1 – 6 of this SIPO.
  • Permitted investments:  Kōura’s investment universe in respect of each fund will be limited to the permitted investments as set out in the Schedules. Kōura is not an active fund manager. Any investments Kōura makes will be made on a passive basis. Kōura will not invest in any non-listed financial instruments aside from unlisted investment funds. Kōura may invest in other investments (that are not explicitly listed as “permitted investments”) that Kōura considers appropriately reflect the risk profile of the fund and will contribute to the performance objectives of the relevant fund. 
  • Rebalancing: Investors are expected to hold a portfolio of funds rather than invest in a single fund. Portfolios will be rebalanced semi-annually to ensure that the proportion of every fund in the portfolio remains at rebalancing as at the time the customer chose the portfolio
  • Derivatives: Except for currency hedging, Kōura does not use derivatives, however a fund may invest in a managed investment scheme that does use derivatives.

For more information, please visit the link below:

SIPO (p. 5)  

How do they decide where to invest?

The investment processes followed by the manager

Investment Philosophy

The Scheme operates to a number of core principles:

Passive investment:

They believe that markets are efficient, and therefore a passive approach to investing will deliver better long term results for investors in the long term. This means that we invest in index funds or indexed portfolios with a long-term asset allocation strategy attempting to replicate market performance, rather than actively choosing investments to exploit short term fluctuations in financial markets. 

Long term views: 

They believe that investors' interests are best served by taking long term views and therefore they should not be making regular changes to the investment strategy or the composition of the Kōura funds. Investors will do better by remaining invested through the cycle rather than trying to time the market. 

Use of underlying investment managers:

For their international exposures (US Equities, Rest of World Equities and Emerging Markets Equities), they will invest exclusively in funds managed by one of the large global passive fund managers. 

For their domestic exposures (NZ Equities, Fixed Interest and Cash), Kōura may elect to either invest directly in a portfolio of securities or alternatively may invest in an existing investment fund. The Investment Committee will review the available options on an ongoing basis. 

Responsible Investing:

As investors they have a unique ability to influence behaviour by choosing where to invest or, more importantly, where not to invest. They therefore believe it is important to invest according to globally recognised Environmental, Social and Governance principles.  

Currency hedging: 

Currency risk adds volatility to investor returns. They, therefore, believe it is important to hedge their international exposures to reduce the volatility of their investors' portfolios. Their hedging policies are described in the Schedules relating to each of their Funds within the SIPO

Below is a link to the  Statement of Investment Policy and Objectives (SIPO) in full:

 

SIPO (p. 4)  

 

Monitoring

Each fund is monitored daily to ensure that investments have been made in compliance with the SIPO.

On a monthly basis, the Kōura Managing Director prepares investment performance reports for the Investment Committee to review the performance of the fund.

On a quarterly basis, the Investment Committee will conduct a formal review of the funds to ensure that they are performing in line with expectation. That review will consider (amongst other things):

  • The performance of the fund versus the underlying benchmark on a monthly basis.  
  • The liquidity profile of the fund. 
  • The reputation of the underlying fund manager (if the fund invests in an underlying investment fund).  
  • Fees  Any other relevant information.

Investment Strategy Review

The Investment Committee meets quarterly. At each meeting, it will review the Scheme’s investment funds and a sample of Kōura Portfolios. In conducting its review, it will consider whether the funds and portfolios are meeting the desired risk and return objectives or whether changes are required to the investment approach, asset allocation or asset exposure being targeted. 

The Investment Committee will report to the Board of Directors of the Manager with the results of that review.

Managing Conflict of Interest

At all times, Kōura ensures that it acts in the best interests of its customers and treats all customers equitably.

Kōura has a Conflicts of Interest Policy in place relating to any potential conflicts that may arise between Kōura and investors' individual interests. Any conflicts must be managed by the Kōura Board and the Supervisor must be notified. Where a conflict exists, it will be resolved in favour of the investor.

Kōura is a wholly-owned subsidiary of Kōura Wealth Holdings Limited. Hobson Wealth Holdings Limited and HWPL Custodian Limited (controlled by a director of Hobson Wealth Partners) are both shareholders of Kōura Wealth Holdings Limited.

Furthermore, two of the directors of Hobson Wealth Partners are also on the board of Kōura. Hobson Wealth Partners are paid brokerage fees in respect of investment decisions for Kōura’s funds. This conflict is managed by ensuring that brokerage fees paid to Hobson Wealth Partners are on arms' length terms.

Does Kōura Wealth Invest responsibly?

Social and Ethical Considerations

Socially responsible investing (SRI) or Environmental, Social and Governance investing (ESG), also known as sustainable, socially conscious, “green” or ethical investing, is any investment strategy which seeks to consider both financial return and social/environmental good to bring about social change regarded as positive by society.

Basically, SRI investing is investing in companies that have a positive impact on society, based on a number of factors.

Kōura’s Responsible Investment Policy

Koura is committed to responsible investing and applies the UN Principles of Responsible Investing. Koura will invest in a way that recognises its fiduciary duty to provide the highest returns to its savers but also takes into account the environmental, social and governance (ESG) issues as they affect the companies whose shares and bonds we purchase.

As investors, we have a unique ability to influence behaviour by choosing where and how we allocate our capital. Equally importantly, international research shows that returns are at least no worse off and potentially better off after incorporating ESG principles into investment decisions.
Kōura and its investors need to acknowledge that it is a passive investor, and relies on external funds and fund managers. As a result, it may not always be able to adhere to all of its ESG principles. Kōura relies on external providers for funds and for ESG analysis, this creates limitations.

The Kōura Investment Committee will review our adherence to our ESG principles at least annually with a view to consistently improving our adherence.
Below is a link to Kōura Responsible Investment Policy:

 

Responsible Investment Policy 

 

Ethical Exclusions

Where possible, they will apply this exclusions list to their own investments - They will not directly invest in companies who are directly involved in the activities set out in this list. They will also select underlying funds that apply a similar exclusions policy.

As of 2 September 2019, the exclusion list included:

    • the manufacture of cluster munitions
    • the manufacture or testing of nuclear explosive devices (NEDs)
    • the manufacture of anti-personnel mines
    • the manufacture of tobacco
    • the processing of whale meat
    • recreational cannabis, and
    • the manufacture of civilian automatic and semi-automatic firearms, magazines, or parts

 

How do Kōura Wealth compare to others?

Best Performing KiwiSaver Funds

FUND TYPE
FUND NAME
5YR AVERAGE
Conservative
Milford
Conservative
6.3%
Moderate
Aon Russell
Lifepoints
7.3%
Balanced
Milford
Balanced
9.1%
Growth
Milford Active
Growth
10.7%
Aggressive
Booster
GearedGrowth
12.4%

*Past performance is not necessarily indicative of future performance.

*All returns are after fees and before tax, updated 30th September 2020.

*Source: MorningStar Fund Report September 2020

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Look at more than just fees and past performance

We have looked at the best performing KiwiSaver funds based on their 5-year returns, however, looking at past performance of a fund is just one aspect when choosing a KiwiSaver fund. Other questions you should be asking include:

  • How and where is my money invested? 

  • What is the level of volatility (risk) of this fund? Does it align with my volatility tolerance and capacity?

  • How do the fees compare to other funds with a similar rate of return?

  • What are the providers processes when selecting investments and making changes in the funds?

Our research team at National Capital looks at over 100+ funds and can recommend the right KiwiSaver investment for you. 

Why get advice from National Capital?

  • Detailed Research: We research various factors of KiwiSaver funds – from asset allocation all the way to ethical investing.

  • Answers: How do I know my money is safe? What risks are being taken?

  • Monitoring: We’re constantly monitoring the KiwiSaver landscape.

  • Expertise: Our team specialise in Investment and KiwiSaver research.

  • No cost to you: We get paid by the KiwiSaver providers

  • Gift of Time: We do the hard work, so you can focus on life.

Our KiwiSaver recommendations look at the big picture and not just the scorecard. So, what are you waiting for?

List of Kōura Wealth KiwiSaver Funds

Kōura Wealth KiwiSaver Scheme has the following KiwiSaver Funds. More details on each of these funds can be found in the links below.


Product Disclosure Statement (p. 3)