Smartshares to manage NZ Super Fund portfolio

Smartshares -- a New Zealand Stock Exchange (NZX) subsidiary -- has been appointed by the New Zealand Superannuation Fund to manage a passive New Zealand equities portfolio.

The funds will be managed against the NZX/New Zealand Super Fund Custom 50 Index -- a custom-built index that will track the NZX's benchmark index of top fifty listed companies.

Individual company weightings will be capped at 15 per cent.

"We are delighted to be appointed as a manager to the largest superannuation fund in New Zealand," Smartshares director Geoff Brown said.

The New Zealand Super Fund is Smartshares' first major wholesale client.

The Government will be hoping for a better return than investors in Smartshares' four existing index-based funds, Tenz, Midz, Mozy and Fonz, have received of late.

Those funds turned in unspectacular performances in the six months to June, all underperforming the market's headline index by a considerable margin.

Tenz, Smartshares' oldest fund, was launched in 1996. It tracks New Zealand's top 10 listed companies and has been dogged by the poor performance of many shares in the index, including Telecom, Carter Holt Harvey and The Warehouse.

The Fonz follows the fortunes of our top 50 listings --- albeit with a capped weighting of 5 per cent.

The Midz fund is based on the NZSX MidCap index of medium-sized listed companies, and the Mozy is based on an index of medium-sized Australian listed companies.

The New Zealand Super Fund made a 14 per cent return on investments in the year to June 30 and now has assets of $6.6 billion,

During the year the fund's assets grew from $3.9 billion to $6.6 billion.

The fund was set up to pre-fund future pension needs by putting aside billions of dollars over the next 20 years to be called upon when demand for superannuation is expected to rapidly increase.

- NZPA