May I ask, which (Swiss) bank you are with? An ultra safe one with unlimited state guarantee or just a random one?
There is no bank which will gives guarantees against scams. I really think you need to differentiate between Esuisse guarantee which is normally for cash and only applies if bank goes bankrupt
I don’t know any bank which is ultra safe and guarantees all your securities against scammers
Even though I always recommend diversification of brokerages and bank accounts, I also think we need to be careful with our accounts in first place.
It’s not so easy to move money from IB to another account. It involves certain steps. For someone to do so without your knowledge would be tough. Most likely you will have some (unknowingly) role in that too (like social engineering, clicking spam links etc) . They would also need to know who you are, are you worth hacking etc
Imagine Saxo only allows to transfer to your own account. But your own bank account allows transfer to whoever. So it’s not only Saxo account that needs to be safe, it’s also your actual bank account too.
So while you try to use more secure brokerage , also try to embed safe digital practices in normal life.
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Sure, I am Dutch and invest at Rabobank. I think we have more or less similar conditions, likely Dutch banks are somewhat cheaper and there is no stamp duty!
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VWRL costs 0,22% vs VT 0,07%. The leakage at VWRL is 12%, assuming 2% dividend it is 0,24%. So in total around 0,46%. VT leaks 0,12% tax on non-US dividend (2023 data). The difference between them was in 2023 around 27 bps. On top of that I have AUM broker costs.
In my case I don’t have access to VWRL at the bank, but to Irish Vanguard Institutional Plus funds. The TER of these funds (World + EM + Small Cap, essentially VT) is around 0,12%, but Vanguard’s Irish mutual funds leak 30% US DWT.
Isn’t it absurd to think that IBKR is not safe? Even Raiffeisen accounts work with SMS verification. You would need a person who is familiar with it and can assess the situation. We can also philosophise about what will happen to VT if Iran sends nuclear bombs to America. How likely is it that your mobile phone will be hacked, your PW will be stolen and that it will hit you?
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Alright WEBG might help close the TER gap in future. As it’s a new ETF launched with 0.07%
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Cmon now you are severely overreacting.
I haven‘t seen a single shred of evidence of actual fraud for retail investors in this thread, that would be due to IBs lack of security.
IB serves MILLIONS of customers and is one of the longest running established brokers.
They are not some 3rd world country trash company.
It‘s absurd what‘s going on in this thread.
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A bit more detailed comparison is available here
Well, yes and know. I didn’t want to silence that user, but I also didn’t necessarily believe in the story. It’s not a bad idea to reassess the situation and learn about alternatives, whatever the occasion is.
If you are taking risks, it’s better to do it consciously.
I hope you’re right 
as I am invested at IBKR. As repeated many times, their explicit policy of not compensating in case of fraud / hack is worrisome.
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Just made a comparison between VWRL and VT in terms of tracking difference between the fund returns and gross benchmark (before dividend withholding taxes). Over the past 10 years VT did 0,32% per year better than VWRL. Note actual performance of VWRL is slightly better due to different benchmark, it does not invest in small stocks, which lagged large cap in that period.
We pay the “wealth” tax, which is roughly equal to 2% of capital per year. No capital gains tax (may change after 2027)
Thanks for sharing
I think you took mathematical average. Isn’t it? Or was it CAGR? In case you would like to see overall cumulative return , then following are the numbers from the ETF webpages.
All numbers as of 31 Mar 2024
VT (NAV) -: 10 yr , 8.76 %
VT (benchmark) -: 10 yr, 8.83%
VWRL (NAV) -: 10yr, 8.63%
VWRL (benchmark) -: 10yr, 8.65%
Where did you get gross benchmark returns? Because normally returns are measured as Total Return Index.
I believe the post tax calculations done by the experts on the forum are quite good and we should count with realised difference of ~0.2% in final post tax performance between US domicile MSCI ACWI index vs IE domicile MSCI ACWI Index (with TER difference of 0.12% inclusive) . Of course higher dividend yield will have slightly higher differences
It is not insignificant difference but I think for someone who is interested to diversify (partially) away from their US domicile positions then VWRL is best option for now. In couple of years perhaps FWRA or WEBG will also be good once they are established.
I posted arithmetic return (not geometric), so it is not CAGR. But the metric I used is pretty good to compare leakages of withholding taxes. This topic is very well studied in the Dutch investor circles.
The fund providers always compare performance with net return benchmarks. Net return benchmarks give you returns after DWT. The gross benchmarks do not take into account losses of DWT: this is important in the Netherlands, as Dutch domiciled funds can claim it back from the tax authorities. The elephant in the room is that there is no Dutch domiciled fund that does not apply an ESG screen. I avoid ESG funds.
The gross benchmark data for can be obtained here:
Look at “FTSE Global Equity Index Series wi All Cap” for VT and “FTSE All-World” for VWRL
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Here is IBKR guide on withdrawing in general:
“Because of anti-money laundering regulations, all withdrawals will be sent in the name of the account holder.”
I would not rely on name at all
Here is IBKR guide how to withdraw funds… to a 3rd party!
There are some controls though:
"…submit the third-party payee information to us for approval. You will be notified when we approve the information."
However consider the potential confusion of joint accounts , married vs. maiden names, double barreled names. In UK you can change your name by deed-poll in 3-8 weeks! And if your name is John Smith, Juan Garcia or Wang
fair enough indeed…
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I have a question for you, since you seem to be well informed about the topic of Total returns.
I was looking at VWRL reporting in Switzerland. And the documentation say “comparison is based on gross income reinvested” … does this mean that assumption would be that full dividends are assumed to be reinvested (without considering L1TW or L2TW) ?
Thanks for the compliment, but I cannot answer your question with certainty. It is likely that they mean that dividend is reinvested before taxes on dividend in Switzerland if you pay such taxes. Their performance data clearly indicates that they benchmark VWRL to the net index, i.e. after dividend taxes at the source (15% in America, 15% in Japan, 0% in UK, etc), the so-called level-1 tax. Probably they neglect level-1 tax and mean level-2, i.e. the tax that investor pays on distributed dividend by the fund.
As you can see, VWRL follows its benchmark very nicely, within a few bps, since inception there has been 0 difference. How can it be for a fund with a TER of 0,22%? It’s not security lending income, as it just 1-3 bps. The answer is that net index uses maximum tax rates, like 30% in America, while US-Ireland tax treaty lowers it to 15%.
To further illustrate the point, compare net and gross returns of a major index, MSCI World:
https://www.msci.com/documents/10199/ce75600b-9451-4f93-be4f-573b702a4827
https://www.msci.com/documents/10199/890dd84d-3750-4656-87f2-1229ed5a5d6e
The difference in annualized 10 year returns is 0,60%. Awesome!
That’s why for me VT is much more attractive than VWRL, at least I don’t pay taxes on US dividend (US is 60% of the fund), and it looks like US has better tax treates with some countries than Ireland (e.g. Japan-Ireland 15%, while Japan-US 10%).
Hope it helps.
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Thanks.
I also have majority of portfolio in VT.
However I also have some VWRL and I just wanted to be sure that I understand the net impact of this choice.
It seems like tracking error is not a good metric for IE domiciled funds because of this benchmark discrepancy. It’s also misleading for investors if benchmark assumes full tax and ETF assumes treaty rates.
I think the calculations made by Dr Pi in past is the best estimate (adjusted for dividend yields) and can be used as good approximation for impact of VT vs VWRL for Swiss investors
I would not judge that harshly, but yes, you need to understand the benchmark. It complicates things indeed that bencmarks use maximum tariffs, while the fund may use tax treates.
I always compare performance to the gross index and nerdishly read annual reports to see the percentage of withholding tax paid, it’s always in the annual reports.
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Awesome.
Now all you need is VT and 2% dividend to match 2% withdrawal rate and you can chill in Bahamas 
Leave security key at home
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