I still don’t see why one would want to hold a bitcoin ETF in a 3a solution that will be taxed upon withdrawal vs in a taxable account where capital gains are tax free.
7 Likes
Plus you don’t profit from exemption of dividend/interest tax in 3a as Bitcoin doesn’t produce income, plus in 3a you will be taxed for capital gains once you withdraw money. There’s absolutely nothing speaking for holding Bitcoin in 3a accounts instead of taxable accounts.
1 Like
Because many people don’t feel confident to buy BTC on websites with silly names, associate it (correctly) with a lot more silliness and silly names like m1lfHunt3r69 on twitter, images of cats and apes, scandals, criminals; they don’t know or want to understand how to use a wallet (I don’t blame them, neither do I, the whole craptocurrency thing is just a problem looking for a solution).
While when you put a name like Blackrock around it, where many, including myself, have put a lot of money in their funds, it suddenly takes on a mantle of authority.
Basically Blackrock is taking fools for a ride, collecting TERs on hot air, that’s all 
I am glad Vanguard is not participating in “trading turds” as Charlie Munger put it.
P.S. in my opinion!
2 Likes
Sure, I’m not attacking bitcoin ETFs (I wouldn’t use them because why pay fees for something you can do yourself but I can definitely see why people would want to buy one).
I could even understand people with no taxable brokerage account and a fear of investments and brokers wanting to buy a bitcoin ETF through their regular 3a provider because that’s the only place they do have an account and would trust buying it.
Problem is: 3a solutions that allow for people to choose how the assets are invested are not your run off the mill 3a providers, and people who go for a customized allocation would, in my opinion, not be likely to be the ones otherwise shying investments. In that context, holding a bitcoin ETF in a 3a would generate taxes on an asset that otherwise wouldn’t generate any (on top of loosing valuable tax advantaged space for assets that would actually benefit from it).
Even for people who don’t max their 3a, you’d probably have to be bullish on bitcoin to buy an ETF holding it exclusively and in a bullish scenario, it’s fully possible that the taxes when withdrawing the 3a would overshadow the tax gain when investing in it.
From a tax perspective, bitcoin and bitcoin ETFs are perfect assets to hold in a taxable account (because they’re not taxed except on wealth) and very, very poor ones to hold in a 3a because they don’t generate anything but capital gains/losses (which wouldn’t be taxed anyway), loose out on the tax freeness of the dividends/interests (which they don’t generate) and will still be taxed at withdrawal (which they wouldn’t be in a taxable account).
I’m not entering a debate on whether to hold bitcoins or not, nor wheter to use ETFs for it or not but if we’re going to hold bitcoin in any shape or form, I’d do it in taxable and keep the 3a space for other assets.
4 Likes
You’re right in everything you wrote, in a far more eloquent way to describe “fools”!
Put it into perspective - 5% max allocation allowed with automatic rebalancing.
That’s a yearly 350CHF buy-in, <0.01 BTC. The management cost of that is 0.875 CHF (as is 90 rappen). Do you really want to optimize 90 rappens, besides being right in theory? Well, go for it.
Even if your 3a is closing to ~100k, there’s a 5k CHF limit to your exposure, which means 12.5 CHF per year for management fees. Oh wow what a waste. You could’ve bought … wait, just about nothing with that money. 
In the end you might pay a few hundred chuffs on capital taxes at withdrawal 20+ years later - that was the price for the service I’m sure a lot of people wouldn’t mind vs risking all their capital and credentials on binance/kraken or worse at FTX and the like.
1 Like
Those who transfered from VIAC to finpension, what was the execution time? Until assets are properly invested at the receiving end.
Even if it’s just a 5% allocation, there’s absolutely nothing speaking for doing it in 3a instead of outside of 3a. That has nothing to do with optimization it just dorsn’t make sense to do it in your 3a portfolio.
The risk is the same whether you buy the Bitcoin ETF inside or outside of 3a, there’s not any more protection in 3a for these securities.
5 Likes
Automatic rebalancing?
Tax saving now (vs capital taxation 20yrs later)?
Which incurs unnecessary transaction costs, especially with a volatile assets such as Bitcoing this could lead to high transaction costs due to the very frequent rebalancing.
What tax savings are you talking about?
You get the same income tax savings if you put something else than crypto in your 3a portfolio for this 5% (ideally something with high dividends/interest as this is not taxed inside 3a).
Again, if you put crypto into 3a, you will get taxed on capital gains at withdrawal, while holding crypto outside 3a will not get taxed for capital gains.
From a tax perspective cryptos in 3a has only negative consequences.
2 Likes
Isn’t it the same for any other instrument?
If you buy an any security or ETF, you’ll get taxed on capital gains when you exit just as well.
Yes, that’s correct. But other securities profuce income, which is not taxed in 3a, while cryptos don’t produce income.
Well, OK.
But then again, the SP500 appreciated close to 25% last year, only to produce 1.39% (untaxed) dividend income. BTC has appreciated well over 100% with 0% dividend income.
Focusing on the small things misses the point sometimes.
Is there a high yield product one can purchase on 3a in FinPension to max out untaxed gains (vs the Quality factor)?
1 Like
High yield and/or emerging markets bonds.
both of which produce approximately zero appreciation (vs Quality)?
You get my point, right?
1 Like
Bit late in the day, or month, but my personal reasoning was that I already buy an all-world fund elsewhere, cheaper, while Finpension is the only solution which offers the Quality mutual fund, therefore I try to take full advantage of that USP.
1 Like
I just noticed FP has a bucket of new funds since they included Swisscanto and also UBS funds.
Without going through all 87 funds, is there anything else worth considering?
My Portfolio1 is in Quality, My Portfolio2 is a mixed bag of minimum volatility equities and hedged bonds (my doomsday portfolio).
Rebalancing can be switched off, for anybody interested. 
2 Likes
why should it be switched off?
Rebalancing only makes sense between assets classes, no? Within the asset class of stocks, if one region grows more than another one, that means its market allocation has increased as well, so no need to rebalance?
1 Like