How to invest in AI from New Zealand

Author: Kevin McHugh, Head of Publishing at Banked

What’s driving the AI boom

The surge of interest in AI investing comes down to money: the world’s largest technology companies have been committing eye-watering amounts to building out AI infrastructure. Amazon, Microsoft, Alphabet, and Meta have each guided hundreds of billions of dollars in annual spending on data centres, chips, and the computing power needed to train and run AI models. That spending flows directly to chipmakers, networking companies, and the operators of the data centres housing all those computers.

At the chip level, Nvidia has emerged as the dominant supplier of the graphics processing units (GPUs) that power AI workloads. Memory chipmakers like Micron and SK Hynix have also seen surging demand as AI systems require increasingly large amounts of high-speed memory. Broader AI infrastructure stocks, including data centres, power companies, and cooling technology providers, have followed.

For a Kiwi investor, the question isn’t whether AI represents a real, sustained spending cycle. The bigger questions are how to get exposure without losing too much to fees and currency conversion costs, and how to manage the concentration risk that comes with a theme driven by a small number of very large companies.

Three ways to get AI exposure from NZ

There’s no single “AI stock” you can simply buy. Most investors get exposure through one of three routes, and many use a mix of all three:

1. Buy individual US-listed AI stocks directly (Nvidia, Micron, Broadcom, Palantir, etc.) through a NZ share trading platform that supports US shares.
2. Hold a themed AI or broad-tech ETF, a fund that spreads your money across a basket of AI-related companies.
3. Buy NZX or ASX-listed companies whose earnings are tied to AI infrastructure, mainly data centre operators.

Each comes with a different mix of fees, tax treatment, and risk. Below is what each one looks like in practice.

Option 1: Buy US-listed AI stocks directly

Sharesies, Hatch, Tiger Brokers, Stake, and Interactive Brokers all let New Zealand residents buy US shares. The main differences are in the brokerage fee (the cost per trade), the currency conversion fee when you move NZD to USD, and whether the platform lets you buy fractions of a share.

That last point matters because some AI stocks carry high share prices, so fractional investing (where you can buy a portion of a share rather than a whole one) is useful if you want to start with a few hundred dollars. Sharesies, Hatch, and Tiger Brokers all support fractional US shares; Interactive Brokers does too on most major names. See our fractional shares guide for the full breakdown.

Here’s how each platform’s fees are structured (check each provider’s pricing page for current rates, as these change):

• Sharesies: Percentage-based transaction fee capped per US-share order, plus a currency conversion fee. Optional monthly plans can reduce per-trade costs for regular investors. Learn more about Sharesies.
• Hatch: Flat-fee brokerage per order, plus a currency conversion fee on each NZD/USD conversion. Learn more about Hatch.
• Tiger Brokers: Flat-fee brokerage plus small US settlement fees, with promotional offers available for new customers. Learn more about Tiger Brokers.
• Stake: Flat fee per trade, plus a currency conversion fee. A premium plan reduces ongoing costs for active investors. Learn more about Stake.
• Interactive Brokers: Aimed at more active or larger investors, with very low currency conversion fees. Generally the cheapest option once your portfolio is large enough that fixed costs don’t dominate.

For small, regular buys, platforms with capped fees tend to work in your favour. For larger one-off purchases, flat-fee brokers like Tiger and Interactive Brokers tend to be cheaper. See our share trading fee comparison for a full side-by-side with current rates.

Option 2: AI and tech-themed ETFs

If you’d rather not pick individual companies, an ETF (exchange-traded fund) lets you buy a single fund that holds a basket of AI-related stocks. You’re spreading your risk across many companies instead of betting on one.

There are two types worth knowing about: pure AI/robotics ETFs that focus specifically on the theme, and broader tech or S&P 500 index funds where AI companies already make up a big chunk. Our ETFs and index funds guide covers how ETFs work for NZ investors.

The main AI-focused ETFs available through US-share brokers like Hatch, Sharesies, Tiger, Stake, and Interactive Brokers:

• Global X Artificial Intelligence & Technology ETF (AIQ): Targets AI and technology hardware names across memory, chips, and software. Check the fund page for the current annual fee and holdings (globalxetfs.com/funds/aiq).
• Global X Robotics & Artificial Intelligence ETF (BOTZ): Focused on industrial robotics and automation alongside AI. One of the larger AI-themed funds by assets (globalxetfs.com/funds/botz).
• iShares Future AI & Tech ETF (IRBO): A broader mix of companies weighted more evenly across the theme, with a lower annual fee than the Global X funds (ishares.com).

It’s worth comparing those against plain index funds too. The S&P 500, which tracks America’s 500 largest companies, already has a heavy weighting in the leading AI names, so a standard S&P 500 fund gives you indirect AI exposure at a much lower annual fee than a themed fund. Our guide to investing in the S&P 500 from NZ explains how.

If you’d prefer to keep things simple and stay on-shore, two NZX-listed funds give you US tech exposure without having to deal in US dollars:

• Smart US Technology (NZD Hedged) ETF (UST): Tracks a US technology index, is currency-hedged (meaning the fund offsets the effect of NZD/USD movements so your returns aren’t affected by exchange rates), and is structured as a Portfolio Investment Entity, or PIE, a type of NZ fund that handles overseas tax complexities for you (smartinvest.co.nz).
• Kernel S&P 500 funds (hedged and unhedged): Low annual management fee, also PIE-structured. Kernel also runs a separate platform for buying selected US-listed shares and ETFs directly (kernelwealth.co.nz/funds).

The PIE structure matters because PIE income is taxed at your personal tax rate (capped at 28%), and the fund handles the overseas investment tax rules internally on your behalf, so you don’t need to do anything extra at tax time. For Kiwis who’d rather not deal with IRD paperwork, a NZD-listed PIE fund is the simplest starting point.

Option 3: NZX/ASX-listed AI plays

The third route is to buy listed companies whose businesses benefit from AI infrastructure spending, without owning chip stocks directly. Most of these are data centre operators, companies that build and run the facilities that house the computers powering AI.

The biggest NZX name here is Infratil, which holds a large stake in CDC Data Centres, one of Australia and New Zealand’s largest data centre businesses. CDC has a substantial and growing portfolio of capacity across both countries, with long-term expansion plans and partnerships with major AI hardware providers like Nvidia.

Because Infratil’s investment thesis is built around long-term infrastructure assets rather than quarterly earnings, it can be a more stable way to get AI data centre exposure than buying chip stocks directly (infratil.com).

Spark New Zealand also has a data-centre angle, though the exposure is more limited. Spark sold a majority stake in its data-centre business to private equity, retaining a 25% share, while committing to a significant expansion of capacity over the coming years.

That means most of the direct upside from data centre growth flows to the private equity buyer rather than Spark shareholders. It’s the most accessible NZX-listed option, but the exposure is diluted.

On the ASX, NEXTDC (NXT) operates a large network of data centres across Australia and has pursued partnerships with major AI companies including OpenAI to develop dedicated AI computing infrastructure.

Macquarie Technology Group (MAQ) is another ASX-listed data centre operator building out AI-capable facilities. Both are more direct data centre plays than anything available on the NZX.

NZX-listed shares like Infratil and Spark are taxed under the standard NZ rules. ASX-listed shares count toward the overseas investment tax threshold explained below.

Tax: The overseas investment rules in plain English

If the total amount you’ve paid for overseas shares (US shares, ASX shares, foreign-domiciled ETFs) stays under NZ$50,000 at all times during the tax year, you’re outside the Foreign Investment Fund (FIF) rules. You simply declare any dividends as ordinary income and that’s it.

Once your total overseas share cost exceeds NZ$50,000 on any single day during the year, you lose the exemption for that entire year. From that point, the FIF rules apply to all your overseas investments, and you need to calculate your FIF income using one of IRD’s approved methods.

Most individual investors use the Fair Dividend Rate (FDR) method, which is simpler than it sounds: you’re taxed on 5% of the opening value of your overseas investments at the start of the tax year, regardless of whether the shares went up or down, or whether you received dividends. It’s a deemed return: a fixed percentage that IRD uses as a proxy for your investment income.

The alternative is the Comparative Value (CV) method, which taxes you on your actual gains (price increases plus dividends). You can choose this method in years when your shares have fallen in value, to avoid being taxed on income you didn’t actually earn.

NZ-domiciled PIE funds (the Smart and Kernel funds mentioned above) handle all this inside the fund, so you don’t need to track it yourself. That’s a real simplification once your overseas portfolio grows.

IRD’s Guide to foreign investment funds (IR461) is the best place to read further, and it’s worth checking IRD’s website for any rule changes. This isn’t tax advice. If your overseas holdings are large or complicated, talking to an accountant is worth the cost.

Risks worth thinking about first

A few honest counterpoints before you invest:

The AI rally has been driven by a small number of very large companies. Nvidia, Microsoft, Apple, Alphabet, Meta, and Broadcom are all positioned as AI winners, which means even a “diversified” S&P 500 fund is more concentrated in AI than it might look. Themed AI funds like AIQ and BOTZ concentrate things even further: their top 10 holdings can make up 35–60% of the fund.

The leading AI stocks are also expensive by historical standards. Markets have remained broadly optimistic, but a slowdown in big tech spending on data centres, a shift in customer demand, or new restrictions on chip exports could cause prices to fall sharply.

Currency is another factor. If the NZD strengthens against the USD, your unhedged returns shrink even if the underlying shares go up. NZD-hedged funds (like Kernel’s hedged S&P 500 or Smart UST) remove that risk, at the cost of a slightly higher fee and giving up any benefit from a weaker NZD.

And fees matter more than people expect on small, regular buys. Investing a small amount in an individual AI stock every fortnight on a percentage-based fee adds up. Either consolidate to monthly orders, use a flat-fee broker, or invest through a NZ-domiciled fund.

Getting started

For most Kiwis getting into AI investing for the first time, a sensible path is:

1. Decide whether you want individual stocks, an ETF, or NZ/ASX-listed companies. ETFs are the lower-effort, lower-risk starting point.
2. Pick a platform whose fee structure suits how often and how much you plan to invest. See our share trading platforms comparison for the full lineup.
3. Set a position size you’d be comfortable seeing drop by 30–40%. AI stocks have historically moved that much during downturns.
4. Consider auto-investing to spread your purchases over time rather than putting everything in at once.

Compare the full lineup of share trading platforms to find the one that best fits your buying pattern.

Related:

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