My foray into private banking

Anecdotally, I’ve heard this from several professional asset managers who mainly (99%) invest money for institutional investors but who offer private money management for “friends and family”: some prospective private clients would hear the professional’s advice on custom portfolio construction (typically a mix of low fee ETFs and/or mutual funds tailored to the client’s needs), but would then insist on adding this stock to the mix, and excluding that stock from the proposed ETF, and discussing (as a layperson really) the benefits of such a, shall we say, Frankenstein portfolio.
All of those professional money managers I have heard this from politely decline managing assets for such “active” private clients as it goes against their professional … pride?
A private banker though will happily accommodate any strategy the client prefers and will at best act as a rail guard for really stupid things the client might want to implement. The private banker isn’t a bad person, they are just accommodating what the client wants.

Anyhow, as @Cortana expressed so eloquently some people will do better this way (even with high fees) than managing the money entirely themselves and e.g. selling at the worst time when panic sinks in for them. The private banker will then at least tell the client that they should sit through this, and hopefully they’re successful. Maybe that alone is worth the high fee for someone who hasn’t got the financial background and the guts to navigate the markets.

No offense taken.

Comparing yearly returns would be adequate if all investments (and potential withdrawals) took place on January 1 (or thereabouts). The total return and the TWR for that year would then match mostly.*
If investments (or withdrawals) took place throughout the year, then you’d need to compare the aggregated total return and the aggregated TWR on a more granular basis. Most funds do this on a monthly basis, but you can go as granular as daily.

At the risk of boring you, comparing a portfolio tailored for high distributions to a total return index only partially makes sense given the way you describe the deceased’s desire for choosing stocks and an apparent preference of high steady and regular distributions (possibly with less volatiliy) over total return of an index.

* The different cash flows from an index fund and the relatively high distribution portfolio discussed here would still make some minor differences.

Hey, wow, what a coincidence, I happen to offer this for a very small fee …

Just kidding.

I would look for someone who does this on Honorarbasis.

The somewhat radical view by finpension claims that there is no independent financial advice (see their post here), but their alternative is that the investor educate themselves – which is not feasible for some people for whatever reason ever.

I hesitate to post the name of the Honorarberater that I used, not because I didn’t like them, but because I don’t want to endorse anyone with my name. If you insist, DM me and I’ll send you a name.

Be prepared to pay up – they are independent for a reason and do have to finance themselves without getting kickbacks from the funds/ETFs they recommend or the bank they will propose for accounts and custody of your assets.


As a private client advisor I experienced that quite a lot. Especially during the Corona crash. From the ~250 clients with invested assets, ~50 called or requested an appointment to discuss the situation in March/April 2020. More than half of them were in the mindset or already decided to sell everything. I was able to prevent most planned sells. Used a lot of graphs, historic data etc. to convince them to stay invested and see the bigger picture. If I remember correctly, only 3 couldn‘t take it anymore. And I‘m glad it turned out that way. Not only for the sake of my annual performance and the bank itself, but for the clients too.


In fitness and strength training there is the saying „the best workout plan is the one that you are going to stick with“. While there might me plans that would result in significantly better results in theory, they won‘t work at all if the person doesn‘t enjoy it, is insecure or loses motivation fast.

I think this can be applied to investing too.


Not everyone will agree with that but imo wealth below 9 digits (OK maybe 8 depending on the case) can be “self-managed” (with a bit of help, sure) and shouldn’t require anything that your average financial adviser and broker cannot provide (vs the obscene fees that private banks charge).

Fees don’t matter anymore once you’re in the 9-digit zone. Bankers then simply become another necessary annoyance among lawyers, service providers, family offices, corporate trustees, like parasites that feed on the back of larger animals.

There’s also the social aspect: similar to luxury hotels for instance, which above a certain threshold all provide the same kind of services and amenities, the only thing matching the price is the level of exclusivity (the “coma” club).


These fees seem quite high even on the range of private banking fees. CS charge me 0.85% “all in” fee including discretionary active management, custody and brokerage fees. Obviously excluding the TER of any funds in the portfolio, but about 40% is invested directly in the stocks/bonds, and most of the funds are active with lowish TER.

EDIT I did the maths, the weighted TER for all 21 fixed income positions is 0.16%, and for all 46 equity positions 0.18%.

Last 10 years it made sense for me, I didnt have time as I was busy turnining around a couple of businesses = very high risk portion of my investments. I was happy to leave the bank to manage a lower risk lower volatility balanced portfolio. Now I have a look to the pros and cons of DIY, with the help interalia of this site.

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That fee seems to be low compared to what I’ve seen in wealth management fees at major banks (but still too high, in my opinion).

According to, the cheapest CS wealth management costs 1.35% p.a. up to 1 Mio. AUM with 45-75% stocks, using index funds: Credit Suisse Invest Mandate (Index) - For direct investment it’s even 1.95%: Credit Suisse Invest Mandate (All Instruments) -

Do you have a discount (due to investing much more than 1 Mio.) or what’s your wealth management offer called?

The Private Mandate All Instruments. Yes of course it’s discounted and a very low 7 figure sum. Negotiated together with a SARON remortgage. But UBS is fighting hard to get the business back and offering similar discounts. But, I do get the impression the banks publish a “rack rate” and woo you with 50% discounts. I might also just have a very good deal indeed.

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you really should. imo, it’s ‘crazy’ to pay ~1% for fixed income (=low return) positions.

An all-in fee of 0.85% p.a. is not high, to be honest. As it says: all fees are included.
ZKB for instance is at 0.95% p.a. which is also quite fair.

I have some clients who have their assets diversified in trading mandate - but also trade with a lower amount on IB.

Maybe I can use an opportunity and ask a question that wasn’t answered for me yet.

How easy it is as a regular person with a wealth of, say, 500k+ , get an access to shares of index funds (CS, Swisscanto) reserved for qualified customers? What would be other associated fees, like custody or management?


Indeed my thinking is heading towards a blended approach with more equities in the mandate (and alternatives - tbc) and get weighting of yield at super low cost in ETFs.

Alternatively “replicate” the mandate via ETF so the blended cost is lower, plus overweight along some thematic/sector topics that I believe in too.

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I dont disagree, but so far I viewed it as a portfolio cost and was too busy to really drill down.


At Swissquote at least some CS QB index funds seem to be available but with the note ‘Mindestzeichnung: 5’000’000.00 CHF’. I don’t know whether that’s a fixed requirement to get access to the QB fund class or whether that’s up for negotiation.

I wouldn’t expect any additional fees. Or did you mean the ZB fund classes? Those are reserved for institutional investors, as far as I know. I wouldn’t expect those to be directly accessible to private investors at all, at least not for anyone investing below 8 digits.

Just discovered which is definitely not mustachian, but likely fees are lower than standard private banking. (It seems to be sub-1% all inclusive of TER + management)

(in case anyone wonders what the landscape looks like, I think people had thread about Alpian too before)

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Could be an alternative indeed

0.75% + stamp duty + TER

Margin on FX is 0.2% (unknown at Vontobel) and the cash in CHF earns 0.5%

Their FX margin on the Swiss market is one of the lowest if we compare with Yuh, Swissquote, Flowbank and Co.

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I’m not the target of those, but if I were I’d probably go with volt, there’s a well known private bank behind and the fees are lower :slight_smile:

How so ? The “Global Trends” dynamic portfolio has the following fees:


at the top, there are the Swiss stamp duty + Margin on FX

Margin on FX and investments TER will determine who is the cheapest.

Let’s not forget the performance net of fees…that’s the most important at the end of the day :slight_smile:

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Ah yes, you’re right. I mixed the 3a fees from the wealth management ones. Anyway, I’m not the target customer :slight_smile:

Haven’t followed the whole discussion, but I’m curious: What’s the value added of private banking compared to cheap DIY index investing?

Given that 99% of active management underperforms, I don’t buy into the idea of “access to exclusive investment opportunities” - that’s just marketing BS to me, trying to make me feel special (which I already do, no need to pay 1.25% for it :stuck_out_tongue_closed_eyes:).

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That’s more about Private Equity and other alternative asset classes to which you only have access to when you reach a certain portfolio size of a few millions/10s of millions.