After a lot of research I am finally making the step (hopefully) towards an early retirement. I am just uncertain about which fund to go for and maybe you guys could give a suggestion? Anything is truly welcomed.
I am considering to put 80% into a fund and leave the other 20% in cash, which I might move into bonds at a much later stage if it makes sense.
One thing to consider is the trading currency. VWRL is being traded in CHF while SWDA is traded in USD. If you’re at an expensive broker like me (hopefully changing soon) you will be facing currency-conversion fees of 0.5-1% each trade (one way, same for selling).
That’s hard to say. I haven’t done the math, it’d depend on how much you buy / how big your stash is. Currency-conversion is a one-time fee while TER is a recurring fee. If you have a lot of money already the difference in TER might exceed the fee you will have to pay to buy USD with your CHF.
You’re comparing these costs over a holding period of merely a year. Holding such funds over just a year is more short-term speculation than investment. And there are probably better products for short-term speculation.
For a longer-term investment though, is is virtually like comparing one-time initial fees. But honestly, is it worth worrying about the cost equivalent of two cups of beer on a 5-figure (10k) investment?
Since the ETF doesn’t issue a dividend, Degiro shouldn’t charge a dividend processing fee on it.
You are absolutely right that the long-term cost should be compared. My investment horizon is 10+ years and I aim for a portfolio covering the world market. I apologize that I did not mention this in my initial post. I decided for Degiro, as I don’t think that my investment reaches 100k soon. I know that the actual break-even is lower due to withholding tax reason.
I updated my calculation for 1, 5 and 10 years and included VEVE and VHVE as well. Those look attractive, but especially the latter has a very low fund size (24M CHF).
If you plan to, you could opt for VWRL/VWRA from the get-go (unless you want to under-/overweight EM compared to the all-world funds).
If you plan to make more regular smaller transactions, I would consider open up an account with one the German online banks / brokers.
0.4% to move your money over to EUR (TransferWise, exchangemarket)
simple pricing, no upkeep/custody fees on the brokerage account
regular smaller investments in ETFs are cheap or free on savings plans (possibly beware of spread / execution prices, but won’t really matter for small amounts)
account handled by well-reputed banks
free securities transfer to other banks/brokers within Germany
Is it the absolute cheapest option? Maybe not. But I’d very much prefer that simplicity and stability over DEGIRO. Who, by the way, are linking to two differing fee schedules on their Swiss website, depending on the language (If you switch their website’s language to English, while still showing Switzerland as the country, the linked pricing PDF shows German markets as the home market). They’re just giving me a bad vibe, somehow.
EDIT: I do speak German, forget about (most) German brokers if you don’t.