Hi,
After reading a lot in the last weeks about investing and money I want to start investing in ETFs. Before I start, I want to understand the different fees (ETF-fees and IBKR fees)
Fee from IBKR is 1.5 CHF + 0.015% when buying on EBS, correct? The plan is to transfer CHF to IBKR and then buy on EBS. Or is it better to exchange currency and buy on another exchange? I don’t want to buy US based ETF. I’m looking to buy Ireland based ETF or Switzerland based.
So for each 1000CHF I invest I pay ETF fee 5% (50CHF) + IBKR fee 1.5CHF + 0.15CHF = 51.65 CHF.
And then each year: 0.12%
And then another 3% when I sell?
CHF 1.50 + 0.015% (min. CHF 0.50, max. CHF 150) is the fee of SIX/EBS, the exchange itself. In addition to that, IBKR charges a commission of 0.05% (min. CHF 1.50, max. CHF 49). And there is a clearing fee of CHF 0.38.
The total fees (assuming IBKR tiered pricing model) are CHF 3.88 at the minimum. This holds up to around CHF 3k. Between 3k and 98k the total fees are CHF 1.88 + 0.065%. Above 98k it’s CHF 50.88 + 0.015%, capped around CHF 200.
LSE and Xetra are less than USD 2 for small trades but you have to pay USD 2 for currency conversion. I.e., if you only buy a single ETF at once, the total fees are often not that far off. However, if you buy multiple ETFs at once, LSE and Xetra are cheaper than SIX if you stick to a single currency conversion.
Read the full text, those are the max. fees you pay, they depend on the distributor from which you are buying/selling it.
You don’t actually pay them directly, meaning you don’t get a bill for the TER, these are the costs of the fund and they are charged to the fund. But they are of course fees.
And to be clear, at IBKR you don’t pay anything beyond the mentioned exchange fees and IBKR commissions when buying/selling ETFs. I.e., these 5% and 3% are completely irrelevant for us.
In general, most ETFs provide much clearer information on their ‘marketing’ factsheets than the legally required KID, in my opinion.
And to be clear, at IBKR you don’t pay anything beyond the mentioned exchange fees and IBKR commissions when buying/selling ETFs. I.e., these 5% and 3% are completely irrelevant for us.
Okay that is good to know, so no 5% and 3% fees, that sounds good
In general, most ETFs provide much clearer information on their ‘marketing’ factsheets than the legally required KID, in my opinion.
Looking at the marketing sheet of the iShares CoreSPI, I don’t see anything about the “transaction costs” which are 0.02% according to KID. So for example for the iShares CoreSPI the annually fees on IBKR are 0.12% or 0.10%, just that I understand this correct. Thanks.
That’s true, transaction costs are not part of the TER. I.e., total costs are 0.12% p.a. in this case (charged to the fund, not from your IBKR cash). However, to my knowledge, transaction costs are similarly low across comparable (passive) ETFs.
If you really want to see how well an ETF tracks an index, you better check the tracking difference instead of just checking the TER (+ transaction costs). https://www.trackingdifferences.com/ may be useful for this. Especially smaller ETFs that use sampling often have a significantly larger tracking difference to the index than the TER. Sometimes bad tracking also results in better performance but that would be luck and not something that can be relied upon in the future. Good passive ETFs have a small tracking difference with little variation between years.
Alternatively, you can also simply compare e.g. the average performance of the last 5 or 10 years between ETFs that track the same or a similar index. This should give you a good indication even if it doesn’t directly show you how well the ETFs track the index. The performance figures are already net of fees, so you don’t have to account for the TER yourself. https://www.justetf.com/ may be useful for this.
That’s true, fees are not everything. If the ETF is underperformaning in comparison to similiar ETFs with higher fees. I will for sure do more research in the next days. On justetf.com the distributed etf charts are threated as the dividends are reinvested?
The displayed performance numbers all refer to the total performance, i.e., including dividend reinvestment. In the individual ETF charts there is a checkbox to optionally exclude dividends.
So now I tried to open an order on EBS for UBS ETF (CH) SMIM (CHF) A-dis https://www.justetf.com/ch/etf-profile.html?isin=CH0111762537#overview for 1000 CHF. Now I see there is a fee listed Comission (Entry&Exit) for 10 CHF. With your example from yesterday I expected the fee would be around 3.88 CHF, so maybe I didn’t understand or I’m doing something wrong, but from where are this 10CHF fee comming?
You’re on the default fixed pricing plan, which has a minimum of CHF 5 at SIX/EBS (the CHF 10 are for the combination of buy and sale). Switch to tiered in your account settings (Account Configuration → IBKR Pricing Plan).
I see CHF 5.38 as total transactional costs in my table but I think that includes the IBKR commission of CHF 1.50 twice (buy and sale). In the preview (button at the bottom right) I see the expected fees of up to CHF 3.88.
By reading and partipating to this forum, you confirm you have read and agree with the disclaimer presented on http://www.mustachianpost.com/
En lisant et participant à ce forum, tu confirmes avoir lu et être d'accord avec l'avis de dégagement de responsabilité présenté sur http://www.mustachianpost.com/fr/
Durch das Lesen und die Teilnahme an diesem Forum bestätigst du, dass du den auf http://www.mustachianpost.com/de/ dargestellten Haftungsausschluss gelesen hast und damit einverstanden bist.
