ETF Distributiv or Thesaurierend (cost and not TAX based view)

Hi all,

I have a question regarding buying ETH Distributiv (cash-out of dividend) or Thesaurierend (dividend will be invested automatically):

  • In theory, ETF based on “Distributiv” have a bader course development (because the dividend payment is calculated into the course)
  • vice versa, ETF based on “Thesaurierend” have a better course development

With oulook to the strategy of a long-term increasing portfolio value the theorie says that the ETF based “Thesaurierend” will be the better variant.

In the “Mustachian” article:

https://www.mustachianpost.com/de/schweizer-steuern-auf-erhaltene-dividenden/

it is stated that it should be “easier” for the tax. OK that’s wright in termin when the ETF is not listed at the Swiss Government. But under normal circumstances the ETF is known and listed in the Swiss Tax Goverment and “if not”, then it is up to you to declare it manually. It is also possible to send an e-Mail to the Swiss government to add the missing ETF.
==> So the TAX-issue should not be an issue to choose this strategy?

Questions:

  • If i choose ETF “Distributiv” this means i have to “reinvest” manually into the ETF after i receive the dividend in cash - this generates additional costs for buying new ETF’s (logically)
  • What is with ETF “Thesaurierend”: With the dividend the ETF company buys automatically new ETF’s for myself? AND: this should not generate costs at for example “Swissquote”?

Therefore for a longterm “Buy-and-hold” strategy i tend to choose the option “Thesaurierend” until I get into the years of “pension”. For genereting a “passive income” I have then to reeinvest my portfolio to “Distributiv” for getting cash-out of my investments. Because the course development of “Thesaurirend” ETF is better than “Distributiv” i will generate a higher ROI when i sell (a part) of my ETF and sell “Thesaurierend” ETH for generating passive invome for my “Pension time”.

Any thoughts and experience in this theory/questions warmly welcome.

What is with ETF “Thesaurierend”: With the dividend the ETF company buys automatically new ETF’s for myself? AND: this should not generate costs at for example “Swissquote”?

You don’t get new shares of ETF, the dividends are reinvested to buy new shares of companies in the ETF

Hei thank’s! So that means that “i spend my dividend” to the fund and they buy with my money more share of companies?
I thought i get automatically new shares of ETF…

You have an option to reinvest dividends in the same fund with some brokers sometimes, but it is not what is happening here.

There’s some issues with the article (and the linked NZZ article) there:.

Wie im Forum erwähnt, stellt dieser NZZ-Artikel über eine Erwähnung der in Zürich ansässigen Finanzberatungsfirma Hinder Asset Management fest:

“Kumulative ETF weisen Erträge und Kapitalgewinne manchmal nicht getrennt aus, was dazu führen kann, dass Kapitalgewinne besteuert werde”

Distributing ETFs can distribute capital gains as well. I’m pretty sure I used to own shares of one or two owned that did.

Also, the final paragraph states (emphasis mine):

“Für Investments in US-Aktien sind aus der Sicht eines Schweizer Anlegers irische ETF markant besser als Luxemburger ETF, am schlechtesten jedoch ist der Erwerb von US-domizilierten ETF am US-Aktienmarkt”

This seems to be, as has been discussed ad nauseam on this forum, plain wrong. US-ETFs would in fact be the best for most Swiss investors from a tax perspective.

…and, possibly, costs for currency conversion.

I’d prefer accumulating ETFs, as long as tax figures are properly reported / available on ICTax and I don’t have to pay capital gains tax. US-domiciled ETFs are usually distributing though.

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