Crypto among new funds on offer

A SECOND KiwiSaver provider is to offer exposure to cryptocurrency in a bid to attract new members.

Koura, founded by Rupert Carlyon just over two years ago, is adding three new specialty funds to its KiwiSaver offering: a carbonneutral cryptocurrency fund, clean energy fund and a New Zealand property fund.

Koura’s move follows NZ Funds Management, which added the ability to invest in cryptocurrency to its KiwiSaver funds in October 2020.

Mr Carlyon said the difference with his KiwiSaver scheme was investors would have to specifically opt in to have the new investment funds be part of their KiwiSaver portfolios.

‘‘We don’t think this is an appropriate investment for everyone. We don’t think everyone needs cryptocurrency or clean energy because it’s high risk and it is highly volatile,’’ he said.

Using Koura’s online advice tool people would be able to select whether they would like to invest in the funds, he said.

A small percentage of their KiwiSaver account would then be allocated to the new funds and members could then go and tailor that and increase it if they wanted to.

But there would be a cap of 10% for each of the funds.

Ensuring people knew what they were getting into was all about disclosure, Mr Carlyon said.

‘‘We have got a very robust process around disclosure. It is going to be pretty hard to say you accidentally ended up here or you didn’t understand the risks. We will be giving people warnings on the way in and making sure we give people warnings after they have selected those funds.

‘‘We are not out to try and convince everyone to invest in cryptocurrency. We are really just saying it is here if you want it; and if you want it, make sure you understand all of the risks. That has been one of the biggest focuses of the regulatory regime . . . making sure we have got all the appropriate disclosures in place.’’

The cryptocurrency fund would be invested in a fund run by Fidelity — the fourthlargest asset manager globally — through an investment structure that was insured against cybersecurity incidents, Mr Carlyon said.

The clean energy fund would be invested via a First Trust ETF [exchangetraded fund] run out of the US which invested in 60 USbased companies involved in that area.

‘‘Historically, it has invested in Tesla and other things all the way from transportation to battery technology to wind technology, but it is really focused on the technology side and the enablers rather than other clean energy funds, which focus more on the utility company side of it.’’

The property fund would invest in NZXlisted real estate investment trusts and the listed retirement village stocks. —