NZX vs ASX: the key differences for investors

New Zealand and Australian investors have two neighbouring exchanges to choose from. They share a time zone (almost), close economic ties and a number of companies, but they're very different markets. Here's how they compare.

At a glance

Size and depth

The ASX is far larger. Its two biggest companies, Commonwealth Bank and BHP, are each worth roughly as much as every NZX-listed company combined. More companies means more choice in every sector and more daily trading, which keeps the gap between buying and selling prices (the spread) narrow.

The NZX is small and concentrated. A handful of companies, including Fisher & Paykel Healthcare, Infratil, Auckland International Airport and the electricity generators, make up a large share of the NZX 50. Many smaller NZX companies trade lightly, so large orders can move the price.

Sector mix

The NZX leans towards defensive, income-paying businesses: electricity generators and retailers, infrastructure, property trusts, telecommunications and healthcare. It has little mining and no large banks of its own (the Australian banks own New Zealand's biggest banks).

The ASX is dominated by financials and resources: the big four banks, global miners such as BHP, Rio Tinto and Fortescue, and energy producers. It also has major healthcare, technology and retail companies.

This difference matters. When iron ore or copper prices rise, the ASX often outperforms. When interest rates fall, the NZX's utilities and property stocks often benefit. Our guide to how tariffs, oil and the NZ dollar move shares goes deeper.

Indices: NZX 50 vs ASX 200

The S&P/NZX 50 is a gross index, meaning it assumes dividends are reinvested. The S&P/ASX 200 headline figure is a price index that doesn't include dividends. So comparing the two headline numbers over long periods flatters the NZX 50. To compare fairly, use the ASX 200 Accumulation Index, which also includes dividends.

Trading hours

Both markets run a pre-open session, an opening auction, continuous trading and a closing auction. The NZX trades from 10:00am to 4:45pm New Zealand time. The ASX trades from about 10:00am to 4:00pm Sydney time, which is usually noon to 6:00pm in New Zealand. For about four hours each afternoon, both are open at once. See the full trading hours guide.

Settlement and holding shares

Both settle trades two business days after the trade (T+2). In New Zealand, shares in your own name sit under a CSN (Common Shareholder Number). In Australia, they sit under a HIN (Holder Identification Number) within the CHESS system. Many investors on either side hold shares through a platform's custodian instead.

Dividends and tax credits

Both countries use dividend imputation, so company tax paid can flow through to local shareholders:

• New Zealand: imputation credits at the 28% company tax rate.
• Australia: franking credits at the 30% company tax rate (25% for smaller base-rate entities).

Each credit only works in its own country. A New Zealander can't use franking credits; an Australian can't use imputation credits. This is why the same company can look more attractive to investors on one side of the Tasman. See imputation and franking credits explained.

Tax on gains

• New Zealand residents generally pay no tax on share gains unless they buy with the purpose of selling or trade as a business. Overseas shares outside Australia can fall under the FIF rules; most Australian-resident ASX companies are exempt. See the FIF guide.
• Australian residents pay capital gains tax on profits, with a 50% discount for individuals who hold shares for more than 12 months.

Disclosure and research

Both exchanges require listed companies to announce price-sensitive information immediately (continuous disclosure), and both publish announcements online. Australia also has a public daily short position report from ASIC, which shows how much of each company has been sold short. New Zealand has no equivalent daily public report. Our guide to ASX short selling reports explains how to use it.

Which should you invest in?

There's no single answer, and many investors hold both. The NZX offers steady, dividend-paying local businesses and no currency risk for New Zealanders. The ASX offers breadth, liquidity and sectors New Zealand lacks. Holding both spreads risk across two economies with different strengths.

Frequently asked questions

Is the ASX bigger than the NZX?

Yes, by a wide margin. The ASX is worth more than ten times as much as the NZX and has around 2,000 listings compared with around 130 companies on the NZX Main Board.

Why does the NZX 50 seem to beat the ASX 200 over time?

The NZX 50 headline index includes reinvested dividends, while the ASX 200 headline index doesn't. Compare the NZX 50 with the ASX 200 Accumulation Index for a like-for-like view.

Are the NZX and ASX open at the same time?

Partly. The NZX opens two hours earlier in New Zealand time. Both are open from about noon until 4:45pm New Zealand time on most business days, and the ASX continues until about 6pm New Zealand time.

Can I use franking credits as a New Zealand investor?

No. Franking credits only offset Australian tax. Some Australian companies also attach New Zealand imputation credits, which New Zealand residents can use.