Best world ETF with Swissquote (trying again)

Investing / Brokers
1

Hello, I am rebalancing my portfolio.

On IB I am getting VT.
I am keeping part of my portfolio (50k) in Swissquote.
(Why is not the topic just here. I know the fees are higher.)

Is VT also the “best etf” also with Swissquote if I want a world etf, or is there a better option?

thanks for your help, my head is hurting from many hours of learning a lot of information about all this and looking at lots and lots of articles and numbers.

(PS made a first post but erased it by mistake, sorry)

2

Your topic will undoubtedly be merged into an existing one concerning the “best” ETF in the context of UCITS ETFs as an alternative to VT.

To answer your question about buying on Swissquote. Buying VT is not optimized because of the purchase cost (I invite you to take a look at the product purchase pricing on Swissquote). To sum up, Swissquote allows the purchase of certain ETFs at a “privileged” price of CHF 9.- flat. This is not really flat, as you have to add stamp duty, any stock exchange commission (CHF 2.-) and any Swissquote commission (CHF 0.85), which sometimes applies and sometimes doesn’t (I don’t know why, as I don’t use this broker).

So buying VT is not the best choice on Swissquote. The alternatives ro VT would be as follows:

  • SPDR ACWI
  • FWRA
  • VWRL

For purchases in CHF without having to convert via Swissquote and its 0.95% surcharge.

4 Likes
3

Thanks, this is already helpful. Definitely finding it challenging to do the maths with all the parts of the fees. And I think I saw that to buy on the NY stock exchange you need to subsribe to real time market data in Swissquote (10.-/mont)

4

Approx 0.3% to buy, 0.3% to sell. 0.95% for FX if you don’t have dollars handy.

If I just add them up , it’s about 1.55% and let’s say you hold the ETF for 10 years, it’s about 0.155% per annum. You can optimise by converting money somewhere else and moving USD to SQ

If you buy SPDR ACWI, the buying cost is 10CHF and no FX. So depending on size of trades, SPDR ACWI can be competitive (and simpler) even after considering 0.05% extra TER and 0.1% WHT tax loss

TER -: SPDR ACWI (0.12%)

1 Like
5

Usually I do my mental accounting like this:

  • an estimated average growth rate is 6% per year.
  • or 0.5% per month.
  • 1.55% entry fee is a bit more than 3 months of time in the market. Not fun, but bearable.

If you use the tax advantage of VT and hold to it for 10 years, might be totally worth it.

Plus the stamp duty of 0.15% (in both cases, actually).

OP might also consider buying VT at Interactive Brokers and transfer to Swissquote, if OP insists.

And OP might also consider diversification of fund providers as well, if you want to diversify brokers.

1 Like
6

If with world you mean MSCI World, then XDWD, which is traded in CHF at SIX and you can buy for 9 CHF flat through Swissquote.

7

If OP is willing to buy at IBKR and transfer to SQ then all the costs become mute issue (trading , FX etc)

My comment was about when ETFs are bought & sold at SQ

1 Like
8

thanks for your inputs, I’m going to have USD available in my swissquote account, and some chf, but mainly USD.

does the currency I have (I would rather avoid converting within swissquote) change which ETF it would make more sense to go for?

I am a bit confused because for each ETF there seems to be the possibility of choosing the currency, the exchange…

9

If I were you, I would continue to buy VT through IBKR.

Pro:

  • no comissions
  • no Stempelsteuer and such things
  • W-8BEN allows paying out 85% of the dividend → opportunity costs

Con:

  • in case you die, your heirs will have fun getting the assets released.

Solution:
Keep buying VT and define a batch size (e.g. USD 400k). Once you reach this size, transfer the securities to SQ. Just hold with SQ. Continue buying with IBKR. Repeat this procedure. Teach your kids and grandkids (jk).

Pro:

  • you keep the trading costs on the lowest level.
  • in average, you will get more than 65% of the received dividends.
  • your costs for securities custody are capped and very, very low.

Cons:

  • you have two broker, there is no one-broker-solution, if you are aiming for the best results (btw: if you want to opimize VT, buy VTI, VEA and VWO, which represent in the correct ratio VT; even lower costs and even more companies behind).
1 Like
10

the situation is that I am stuck with a certain % of my assets in Swissquote for the time being. And I am wondering what best to do with that money inside swissquote (assume moving it out is not an option) until the situation changes.

11

If you intend to invest the $50k all at once, choosing a USD-traded ETF categorized as ETF leader by Swissquote would be the best option to minimize the fees (flat $9 commission + exchange fees + stamp duty). One such option is the USB MSCI World ETF with a TER of 0.10% (accumulating IE00BD4TXV59 or distributing IE00B7KQ7B66). This doesn’t include any emerging market stocks and you lose the 15% US WHT, but seems like a great option otherwise.

Depending on how long you’re stuck at Swissquote for that part of your portfolio, it may be worth buying VT at Swissquote (commission is $135 for a trade between $25k and $50k) to get the tax benefits and slightly lower TER - and emerging markets and small caps.

Swissquote ETF Leaders

1 Like
12

Following are possible

WEBG (in USD)
SSAC (in USD)

1 Like
13

These are both ‘ETF Leaders’, so that’s good. SSAC has a TER of 0.20%. I would prefer an ETF with a lower TER. WEBG with the 0.07% TER might be a great option, though.

1 Like
14

I agree that WEBG is cheaper. But it is distributing, so dividends would also need reinvesting

The only advantage of SSAC is that it is sold in two currencies on SIX (USD & CHF) & they are accumulative. If someone have higher positions in SSAC USD, they can switch to SSAC_CHF for 50 CHF and then they have CHF denominated asset without paying any FX fees.
So it all depends on how much money is involved and how long is investment horizon.

I would have loved SPDR ACWI to have a dual currency situation too.

3 Likes
15

Yes, that could be interesting as well. The UBS MSCI World ETF is also listed in both USD and CHF but only for the distributing share class. The accumulating share class is USD-only.

1 Like
16

Note that you can buy SPDR ACWI in CHF on DEGIRO.

17

Yes I am aware
I buy it on SQ for now in CHF

18

Folks who use Swissquote, can you tell me if Annual account statement is enough for tax return purposes ?

I only have a couple of ETFs in my trading account.
I am wondering if I need to get a specific eTAX statement or I can just list the securities in ZH tax software & attach the annual account statement and that’s it

19

Unless you claim da-1, ZH doesn’t need you to attach any statement.

3 Likes
20

Yes, you can. The eTax statements are just meant as an optional and convenient shortcut.

2 Likes