Just sharing an interesting article about AGIO
Heh, was shared upthread 
Ahh sorry. I just read it and thought it explains very well some points. Didn’t realise it was duplicate
1 Like
Is there any summary of some kind about RE investments for Swiss investors? Basically a guide on if, when and what kind of investments to choose (domestic/abroad, REIT, direct residential etc.)?
That is a lot of topics to put aside, but generally speaking it is what would happen. You might have extra problems with taxes because you will get cash in lieu of dividend. If I was working for the taxes and hated you, I would definitely use your own broker statements to show that you technically didn’t received tax-free distribution and that you should pay taxes on the distribution. Who knows who would win in court
So you mean take margin loan and invest in DRPF?
IB will/might loan your shares if you are on margin. That means the statements will show “cash in lieu of dividend” instead of “dividend”. The money comes from the one that borrowed the shares, not from the fund.
About professionnal trader, as I always says, the sentence says “proportionnaly” or something similar. That means that according to me, you need to have a higher yield than the borrowing rate, not just more dividends that the interest in absolute value. It looks like a lot of people don’t come to the same conclusion, but no one with a different analysis has provided a different explaination of the presence of the concept of proportionallity in the sentence.
Okay.
I think the main thing to think about a scenario if DRPF drops 20%, would it cause an issue for you or not.
It’s a liquid fund but in the end the underlying assets are volatile.
SYEP is when you don’t use margin. They will loan your shares anyway and not give you a cent for it if you use margin.
1 Like
This only concerns US ETFs and CH funds. I don’t think there is much interest in shorting these RE funds, but if your shares are lent when there is a distribution, technically speaking you are not entitled to receiving back 35% of the Swiss withholding tax 
.
1 Like
So for the not-uber-rich who pay more in wealth tax each year than my entire wealth is, is DRPF still worth considering when planning to invest in RE, or should one rather invest into an SXI ETF?
22 posts were merged into an existing topic: Mandatory Expenses once FIREd
I got confused on the wealth tax part. Why would it decrease the wealthy tax? Can you elaborate on that?
In my naive view, imagine I deposit 200k cash and purchased 400k worth of DRPF with 200k margin loan. I am paying wealth tax of 200k in both scenarios.
No, you would a taxable wealth of about minus 200k, as the tax value is close to 0 for the funds that directly own real estate
oh wow. That’s surprising. The DRPF fund value is not subject to wealth tax?
yes, no taxes for DRPF. Wealth or Income for investors.
But they are paid at fund level (if they have any)
Another question. Regarding positive carry
I see the dividend yield is about 2.1% (4.2/20) and possibly/hopefully keep dropping when the price go to 20.5 or even 21.
and the blended margin rate at IBKR for 1 million is 2.181%, for 3 million is 2.001%.
Am I getting it right? It seems to be barely positive, even if considering the margin loan of a few millions CHF.
You can use margin without breaking a professional trader trader rule, as long as your taxable portfolio income at least matches the interest payments on your margin.
IMO, probably not.
Trying to diversify away from a 100% stocks portfolio and increasing home bias a bit, softening the dips while trying to maintain returns.
But to be honest I still haven’t found a really convincing source that says “adding x% of Swiss RE with yearly rebalancing outperforms a pure world stocks portfolio”.