if you are saving 100k CHF per year, then you are in a different league amigo. 
my early retirement goals luckily aren`t in Switzerland - so still doable with close to 40k a year.
2 Likes
whooo. Imagine how much you could save if you stop buying pre-made food every other day
(joking)
On topic: How much is Swissquote insured for similar situations? 100k for cash and?
1 Like
Just learned recently, that you can call them for the CHF>USD transaction and will get a better forex price if your account is over 50k.
Correct, I would precise that every stock/bond you purchase are in your name and registered at your name (X has purchased 100 shares of TSLA ; 80 shares of VT) so if your bank or broker get bankruptcy, you will only lose the cash sit at the broker. For Swissquote, your cash is guarantee until CHF 100’000.- (I suppose that for professional trader it is not unusual to have 500k /1M in cash in order to trade everyday).
I don’t know where I read that SQ has to register your stock/bond in a official swiss registration.
Oh ye of little faith in compound interest. To get to 200k in 5 years you only have to invest 5x33k and the interest will do the rest. 
1 Like
Sorry guys, you missed the point. The same rule apply to IB. The point is not what could happen in a normal bankrupcy, the point is what would happen in a fraudolent case. Until now, SIPC will pay 500k ( at some point). In the future EU will intervene and will pay only 20000EUR.
What happens instead in Switzerland for SQ?
1 Like
This is not unique to switzerland, it’s the same in the rest of civilized world, called client asset segregation. The difference to countries like UK or US, is that there you get some extra insurance (FSCS / SIPC) if your broker lies to do. But in swiss you get nada. You have to pray that your swiss broker doesn’t lie
Completely incorrect.
At best you are recorded as a beneficial owner even on those few exchanges that do record such fine details. Swiss and US exchanges don’t, jus your broker’s name.
It’s actually pretty simple - as long as you can trade at a moment’s notice through your broker, your securities are in principle not safe from broker fraud.
You have to go through excruciating moves like DRS or paper certificates to get some sort of guarantee that your broker wuldn’t be able to sell your sh*t while you are not looking
They don’t. And often they can’t - e.g. in case of US shares, DTCC doesn’t record beneficiaries
4 Likes
Now I’m thinking: is there a way to insure yourself individually? This is absolutely a thing to insure against: very low chance, very devastating consequences. Next to Haftpflicht and Health Insurance, Financial Institution Fraud insurance should be something you want to have. But as far as I know, there isn’t one, or?
Btw I am as much afraid of the broker committing fraud, as I am of a hacker wreaking havoc on my portfolio, or even of a glitch in the system that would screw with the position keeping.
2 Likes
I tried to google that but I get garbage back. I might try with german words that are more precise.
Some RC insurances have clauses about internet stuff but they are limited.
Very good idea, that would be some insurance worth taking, if it exists at all. If you can find anything that’be very interesting.
Thanks for these informations, I will never stop learning! I need to have more knowledge about all of this stuff and probably will invest some of my time to improve
1 Like
I found this:
https://www.mobiliar.ch/versicherungen-und-vorsorge/wohnen-und-eigentum/cyber-schutz-versicherung
But it only protects you against such things as identity theft, credit card violation, online shopping, data loss. Nothing about broker or even bank account.
from reddit:
The SIPC fund has access to $6 billion. The larger US brokers covered by SIPC have $ trillions AUM. Even IB as a smaller US broker has about $160 billion AUM. If IB pulls a Bernie Madoff, how exactly will the SIPC fund pay out $160 billion from $6 billion cash and credit line? The $30 million insurance is meaningless if they pull a Bernie Madoff as it has “an aggregate limit of $150 million”.
[note from me: like our bank insurance for 100k CHF…]
I still would like to know how much is really transferring stuff to SQ and mainly which kind of insurance SQ has. I suppose none. Maybe the safest bet is to move all back to PF if they didn’t have implemented those new costs.
source of the source:
2 Likes
How would PF be safer than SQ?
Just because of the dimensions. They also have a supplemental insurance scheme, but I am not sure it counts.
Cash is secured in both cases by Esisuisse. Whereby the size of PF might be a disadvantage because Esisuisse is limited to 6bn chf.
The e-trading platform of PF is actually run by SQ, they look the same and they are the same (link). Quote: “Swissquote is responsible for custody account management on behalf of PostFinance.”
So if SQ loses your shares, you would suffer from it also as a PF customer. In both cases, you’d probably have to drag either broker to court and fight for your money. Or, since such a case might attract bad press to Switzerland’s financial sector, the government might step in anyway.
I don’t know what your FIRE number is, but I would guess >= 2’000’000. It does not seem crazy to me to split such an amount between several brokers.
I personally start to feel uncomfortable when I have more than 500’000 in a single place. If I need 4 brokers to feel safer, I will pay the extra cost. I see it a bit like an insurance (I don’t lose everything in case of a disaster but I have to pay an extra for this).
2 Likes
My fire number is 1m. Broker cost when splitting is a secondary issue for me. Simplicity and minimalism is the most important. I would really not like to have to split between 3-4 brokers.
JLCollins keep everything at Vanguard and he wrote a blog post about it.
1 Like
Can you explain what you mean by “SQ loses your shares”? Contrary to other Brokers SQ doesnt make securities lending with your shares and your shares are not part of SQs bankrupt estate, since they are only hold in your name there.
They write in their faq: “Swissquote Bank Ltd holds a banking licence and is therefore subject to the supervision of FINMA (the Swiss Financial Market Supervisory Authority). Swissquote Bank Ltd is a member of the Swiss Bankers Association (SBA) and a signatory of the Depositor Protection Agreement. This agreement provides each bank creditor (Depositor) with immediate protection of up to an equivalent of CHF 100,000 for cash savings should a bank become insolvent. Should Swissquote Bank Ltd become insolvent, securities are fully guaranteed if they are held by the respective custodians in your name.”
2 Likes