Mustachian portfolios

My understanding is that it will (try to) replicate the movement of gold when expressed in USD, but in CHF instead. It’s fairly different from owning gold directly (personally I’m not sure I understand why people would do that, but shrug :slight_smile:)

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New to this forum, so bear with me! I started my interest for index ETF three years ago, but didn’t have the energy/guts to open a brooker account. Now, i am set with IB and Degiro (for kids) and 100k to be invested (the sooner the better even though it’s a weird “timing” amid the crisis - but hey we don’t wanna time the market, right). Nonetheless, I was wondering about one thing. There was a bull market over the past decade and almost all portfolios posted here started somehow in this period. Any ideas how to be well diversified for an upcoming bear market (if there will be any - or am I am already trying to “time” too much …)? Thanks for hints/replies!

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Thanks for your super-fast reply!

Degiro for kids because of cost-averaging and portfolio way below 100k.

How old are you / investing horizon? Are you swiss / living in ch / working in ch / gonna stay in ch? Do you rent / buy your home?

I am 39 (2kids), Swiss resident, working in CH, gonna stay hopefully in CH. still renting in CH but I own an apartment in Europe that is sub-rented and “generates” about 6k / year (net).

About the horizon: the big unknown :slight_smile: obviously, we would aim for 10-25years but it depends if we would buy some real estate in CH (in that case I’d sell the foreign property).

Yes: go, look elsewhere.
You might find another forum to discuss such ideas.
The only way is up, up, up!

hehe, you mean scrolling up to the top of the forum post and start investing :smiley:

Just do IWDA+EMIM on Degiro and VT on IB. No hedging necessary for 15-20y time horizon.
If you feel like trying to beat the market, allocate a small part of your portfolio (10%?) for this purpose. If it outperforms, congrats.

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Thanks for your feedback! I will start investing quarterly for the next 12 months.

Hi ritzdank,

If your purpose is to maximize profit throughout a bear market, I’d play the long game, take the bear market as an opportunity to buy cheap and make my profit once the stocks start going up again, turboboosted by all the cheap stocks that I have bought up to then. There are plenty of examples of portfolios that would sustain this strategy in this thread.

If you are afraid of drawbacks and feel you may be tempted to sell through a bear market if taking too many losses, an option is a conservative assets allocation (60/40 or 40/60 are popular ones you may want to study). Another option are defensive portfolios, meant to limit drawbacks rather than optimize returns. One example would be Ray Dalio’s All Weather Portfolio, another one the golden butterfly.

I can’t help if what you want to reduce is currency risk since that’s not something I’ve put real effort into understanding as of yet.

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My current portfolio:

IBKR: VTI
VIAC: 12% SMI, 25% SPI Extra, 18% Europe, 9% Japan, 6% Pacific, 7% Canada, 20% EM, 3% cash
ValuePension: 3% SMI, 6% SPI Extra, 30% MSCI World ex CH, 60% MSCI USA, 1% cash

14.5k IBKR, 14.2k VIAC and 17.8k ValuePension, so 46.5k in total. Future contributions: 1.5k IBKR and 568 VIAC per month. I will quarterly adjust the MSCI World/USA ratio in ValuePension so that I don’t get overexposed in the US because of my higher contributions to IBKR and VTI.

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I’m not sure if bonds with negative real return are a good alternative today.

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apologies if my enquiry here is not directly related to the post above

what is the reason that we invest via IB on the VT / VTI / VTWL ?
there is a tax impact on dividends if same ETF via Swissquote of CT for example ?

we can still own / buy USA ETF’s via a Swiss Bank - correct ?

many thanks

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Yes, most swiss brokers have US ETFs (but then most swiss brokers are fairly expensive :slight_smile:)

At IB we save Foreign exchange & transaction commissions buying & selling & annual depot costs compared to Swiss broker.

In the end, no.

Yes. In some cases it may make more sense to buy VWRL & others (IE-based) instead of the VT’s, when with a Swiss broker.

Well, you are 39 with wife and 2 kids… and you want to go all in on shares? Whilst I understand you already had wealth of about 100k… i suspect that your ability to materially save will be constrained. Unlike people that save 30%+ of their current wealth you won‘t be able to buy low in case the market crashes.

Hi @TeaCup, thanks for your reply and consideration! Sure, I don’t wanna play lottery with my family, hence I am here to gather more understanding (apart from reading books about investing).

I haven’t been explicit enough maybe. We do have an emergency fund of 40k in cash, +contributions to pilier 2 and 3a (~120k) and some real-estate (~200k worth). So, the 100k for shares at IB are definitely not 100% of our net worth. As with many other mustachians on this forum, I also “accepted” the fact that my pilier 2+3 are some sort of bond investments (hence my balance bond/shares is already at about a 40/60 split).

My current problem/question is rather should i lump-sum invest the 100k onto the market or do cost-average quarterly over the next 24months for example. For the latter, does anybody know how much of negative interest rates are applied at IB for parkign CHF cash assets?

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Negative interest at IB begins with 100k CHF. At the moment, you pay 1.062% on the money over 100k.

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We’ve recently had plenty of discussion about this on this (bit unaptly named) thread. :slightly_smiling_face:

My personal recommendation still stands to go with what you are and feel comfortable with.

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Yes, indeed the thread topic isn’t quite clear :grin:. My last questions posted here are also heading away from the thread’s initial purpose! So, I will stop asking new ones :slight_smile: Many thanks to all the lovely people here helping me in deciding upon our financial future!

Hello, I am new to investing (but not so new anymore either). I have a savings rate of 55% and it is likely to go up in the near future as I am in line for a promotion. I am very satisfied with my current lifestyle and that is what I aim for in retirement. So that part is all very well managed. Investing, however, is still on training wheels. I started investing circa 2 years ago and went from all cash on hand to the following situation as of today:

130K invested in ETF (VT/VTI/VXUS)
10K invested in stocks
38K invested in pillar 3A (VIAC, 80% Global)
20K voluntary buy in to pillar 2
180K cash in hand (I know…I feel like an idiot for not being bolder)

I am entering my 40s now and I hope to be bit bolder in the coming 10 years and ramp up my investing. This is my current monthly savings and investing strategy that I have been trying to stick to:

  1. 580 chf to VIAC
  2. 3000 chf to ETFs
  3. 2000 chf to bank account (doing nothing)…

I realize that point 3 is not ideal at all, but it has been tough going from 0 investment to the amount I have today. At this point, I feel comfortable with this formula. According to my calculations, I should be able to achieve FI in next 12-15 years with an annual ROI of 5.5%. I do make lump sump investments that go beyond 3000 chf monthly when there is a market crash like the coronavirus crash when I invested around 40K chf. Another thing that is forcing me to be bolder is the ever creeping negative interest rate threshold for holding cash in bank.

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Maybe you should look arround for a good local bank with good interest rates. Bank bonds for 7-8 years at 1.25% or similar. That way the return of your risk free part will be a bit higher.

I have never heard of such a thing in Switzerland. Is this really possible? Mind you, I am a US citizen so the choices for investments and banks is rather lacking.