Buy and sell spreads.

We don’t currently charge any buy and sell spreads across any of our schemes – Westpac KiwiSaver Scheme, Westpac Active Series or Westpac Retirement Plan but it’s important that you know what they are in case that changes.

What are buy and sell spreads?  

When you invest in a managed fund, you’re not buying individual shares or bonds directly. Instead, you buy units. Each unit represents a small slice of everything the fund owns. Buy and sell spreads are our estimate of the trading costs to buy and sell assets, such as shares and bonds. The unit price of the fund is then adjusted to cover these costs.

How do they work? 

When you invest or make a change to your investment (contribute more, withdraw money or switch funds) the fund may need to buy or sell assets. This involves trading costs. We can apply buy and sell spreads so that only that investor pays the trading cost, not everyone else in the fund. This helps to keep things fair and makes sure investors aren’t penalised when others move money around. 

We may apply a small adjustment to the unit price when you enter or exit a fund. In normal trading and market conditions, the spread applied will generally be 0% (meaning there'll be no change in the unit price). However, this may change during periods of market volatility or increased fund switching when the amount of trading and the cost to do so increases.

It’s important to remember that any buy and sell spreads applied go back into the fund. They're not a fee paid to us and we receive no benefit from them.