My already adult son would like to start his adventure with investing. Could anyone recommend the best broker for such case? And the case would be:
For the time being quite small portfolio (starting with 800 CHF, no steady income yet as he is about to start his studies) → personally I have SQ, but I guess it doesn’t make sense, due to fess, especially custody ones with such a small amounts
Something easy enough, but also not too much gamified, eg. he has Revolut card, but I’m not sure if investing there would be a good idea
What would you recommend? IB? Saxo? BCV TradeDirect (he currently has an account at BCV), …?
Additional, tax related question: does opening such account mean that he will have to start doing yearly tax return, even without having the income? (he has currently permit C)
TradeDirect seems like a decent option if he already has an account with the BCV, though the fees are at the level of Swissquote so if that’s a no go for you or him, I would then go for IB.
The UI of TradeDirect isn’t very friendly. The platform is acceptable for buy and forget but not much more than that.
OK, yes, I should have mentioned that. I guess he wants to start with something like 500 CHF long-term and 300 CHF for playing a bit to learn about emotions etc… I think it’s not bad idea - probably most of us, even on this forum went through such period
Not at all… He is at very early stages with all this. Of course I’m ready to spend time with him to provide some guidance and explanations, recommend good reads etc. I hope that moment will come at some point in the future, but currently he is more at the “casino stage”, playing blackjack or poker with friends . Me personally I have never visited any casinos, which he already did a few times (with group of friends). At least he is able to stick to relatively small (like 50 CHF max) budget and he is not increasing that when he loses and is able to take the wins into the pocket and exit hehe. No warnings signs for me so far, he treats it more like a fun, not a way to get rich. But I’m vigilant .
So I’m looking for something giving him the opportunity to play a bit, at the same time offering possibility to invest in some cheap all-world ETFs etc. All with as low as possible costs, without too much gamification, not to promote bad behaviours.
I was not aware that Neon has a trading platform, that may be interesting one to check, thanks @ma0!
I would want to make sure that he benchmarks himself and decides before doing any trade what he expects out of it, that can help to learn from it.
I would ask him to decide what vehicles he wants to use.
Stocks ?
Bonds ?
ETFs ?
Mutual funds?
Cryptos?
You know him better than we do. I don’t know if the best approach is to talk candidly about everything or if it’s better to avoid certain topics that can take him into gambling, i.e. derivatives.
Options and futures are out of the picture given his starting pot but CFDs, which really are casino-style vehicles, are an option. A CFD (Contract For Duration) is a promise from your broker that they’ll pay you the value of the “underlying” when you sell it. The broker has a lot of latitude, practices their own accounting and there is very few regulation, it is basically a trust thing. They allow to use leverage and/or short the market (also on leverage), which means one can loose way more than what is on the account. Not something I’d recommend but if he looks by himself, he might come upon them so it’s as well to talk about it prehemptively.
If he is interested in single stock trading, I would ask him to define his approach (value i.e. finding underpriced stocks, trying to catch an upswing, technical analysis, other?).
I would recommend:
Puting some in a 3a at VIAC or Finpension (I prefer VIAC myself) ;
Using VIAC invest or Finpension Invest, as recommended by dbu, for some of the remainder and put it in broadly diversified stock ETF(s) and let him use that as a benchmark.
If he really wants to go for it, use the rest as play money.
IB has potentially too many authorisations though with his small starting pot, he probably won’t get access to them so it could be an acceptable platform.
TradeDirect is probably not the right platform to scratch a betting itch and it’s probably not optimal if he has already access to VIAC/Finpension Invest or Neon on the side. The fees will be too high if he slices his monthly CHF 800 too.
Edit:@baldur this message can be deleted on request if the plan is to have your son read the topic.
Would be my recommendation if trading of stocks and/or international (i.e. non-Swiss) ETFs are involved. It’s simply the cheapest option around, so he can start making investments even with very little money.
From what I heard, IB seems simple enough for a regularly functioning adult… Maybe depends on the definition of easy then.
Also apologies, @gaijin actually did recommend IB, and @Wolverine also mentioned it as the cheapest option.
Anyways, my recommendation for an adult kid would be to have them to do their own research - and then maybe confirm/give input from your side, though maybe this is what’s already happening.
I’m familiar with SwissQuote, Saxo, Neon, Yuh, Kraken and IBKR. IBKR is the only broker I’ve found complicated and often just doesn’t work (at least for me) [1, 2, 3, 4, 5].
The usability is a bit odd, too [1]. Sometimes I get emails where they forgot to fill in the placeholders (mostly in german, the english version below in the same email then have the placeholders filled). And then there are somehow two notification centers, I get every message in de UI twice and have to mark them as read twice. Then there are all these technical questions like, “Are you aware that xyz (financial question)…”, when buying a dead simple ETF, etc.
To me describing IBKR as simple is the biggest mystery of the Swiss investment bubble
I would only recommend it if the person has experience in IT, office work or administrative tasks, etc. and enjoys working in those areas and would like the cheapest deal.
If you want a Swiss bank, Yuh is currently the cheapest for smalltime trading.
Depending on his interests, you could also look at something like Splint Invest (trading tangible assets like fashion items, Pokemon, art, etc.). Works well for one of my boys who isn’t really interested in the stock market.
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. Me personally I have never visited any casinos, which he already did a few times (with group of friends). At least he is able to stick to relatively small (like 50 CHF max) budget and he is not increasing that when he loses and is able to take the wins into the pocket and exit hehe. No warnings signs for me so far, he treats it more like a fun, not a way to get rich. But I’m vigilant 
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