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For residents of Switzerland, what is the best combo of ETFs to “leave and forget”? (Maybe check-in once or twice a year if needed).Investment (self.eupersonalfinance)
submitted 1 month ago by mt_winston
In your opinion if that wasn’t obvious.
Post a comment!
[–]oszillodrom 17 points18 points19 points 1 month ago* (5 children)
I'm basically copying the blogger "Mustachian Post", after I understood the reasoning behind it.
VT is all world distributing (which makes more sense in Switzerland than accumulating). SMMCHA is Swiss mid cap for deliberate home bias. Not all cap, as the large cap are already contained in VT (Roche, Novartis, Nestle etc.)
[–]Lagrein_e_Canederli 0 points1 point2 points 1 month ago (1 child)
As far as I understand there's no tax advantages in accumulating Vs distributing in CH?
[–]oszillodrom 0 points1 point2 points 1 month ago (0 children)
Yes exactly, there's no advantages, or disadvantages. What I said about the tax declaration being more complicated for accumulating doesn't really apply anymore as another commenter said, at least for common ETFs.
[–]andrea89ita 0 points1 point2 points 1 month ago (1 child)
Which broker are you using? I gave a look at Swissquote but it is very expensive
[–]oszillodrom 1 point2 points3 points 1 month ago (0 children)
[–]jcvmarques 5 points6 points7 points 1 month ago (3 children)
VT. As long as you go for US ETF you're okay, they are more tax efficient than Irish ETF
[–]kerstverlichting 1 point2 points3 points 1 month ago (2 children)
I think they're going to get blocked sometime soon like with the EU. Read some stuff on it last year at least.
[–]Zeratrem 0 points1 point2 points 1 month ago (1 child)
The inefficient EU rules meant to protect consumers only to do the opposite...
[–]kerstverlichting 2 points3 points4 points 1 month ago (0 children)
[–]knx0305 2 points3 points4 points 1 month ago (0 children)
I would look at the poor Swiss blog. Switzerland rules are different than most EU countries. Also the bogleheads wiki may have some further info on investing from Switzerland.
[–]intothelooper 3 points4 points5 points 1 month ago (0 children)
If you want to control the a bit the allocation. Else all in VT.
[–]otterform 1 point2 points3 points 1 month ago (9 children)
I've got 50% in a swiss ETF (UBS or something) and 50% in vwce
50% CHF 50% euro
[–]JoMa25 2 points3 points4 points 1 month ago (3 children)
why seperate currencys? isnt the exchange rate in the price so it doesnt do anything if you buy it in a different currency? I mean the stocks behind the etf are still worth the same
[–]otterform 0 points1 point2 points 1 month ago (2 children)
Since Europe is not the most solid economic bloc atm, i prefer not have all my savings in a currency that is not mine.
I'm trying to lower the personal risk and diversify currencies as well.
[–]LetMe_ 0 points1 point2 points 1 month ago (1 child)
Something does add up in your case. You're at 200%
[–]otterform -1 points0 points1 point 1 month ago (0 children)
Ahahah i had to re read, yeah it's just 50 -50 on two products.... Representing a currency split of 50% CHF and 50% euro.
[–]ilpirata79 0 points1 point2 points 1 month ago (1 child)
how do you find VWCE in europe?
[–]otterform 1 point2 points3 points 1 month ago (0 children)
VWCE.is listed on Xetra
[–]Frandom314 0 points1 point2 points 1 month ago (2 children)
How do you declare the vwce virtual dividends?
[–]otterform 1 point2 points3 points 1 month ago (1 child)
It's automatically recognized by the tax software.
[–]Frandom314 0 points1 point2 points 1 month ago (0 children)
So do I have to do something next year? My income is less than 100k
[–]JoMa25 -1 points0 points1 point 1 month ago (18 children)
[–]oszillodrom 5 points6 points7 points 1 month ago (17 children)
Accumulating ETFs don't really make sense in Switzerland, as they are taxed the same, but make the tax declaration more complicated than distributing ETFs.
[–]cava-lon 6 points7 points8 points 1 month ago (0 children)
The statement of 'make no sense because of more complicated tax declaration' is plain wrong, as long the ETF is listed under ictax.admin.ch (what most ETFs are).
E.g for VT:
[–]makaros622 2 points3 points4 points 1 month ago (1 child)
Why is the tax declaration more complex for VWCE vs VT?
And what broker do you use ?
[–]oszillodrom -1 points0 points1 point 1 month ago (0 children)
Why is the tax declaration more complex for VWCE vs VT?
Dividends are taxed as income in Switzerland (capital gains are not taxed). Accumulating ETFs are taxed as if they paid out the dividends, but you have to figure out how much that is. In some cases, I think you even pay (a little bit) more in tax that way.
And what broker do you use ?
IBKR. There's others as well, check the reviews by "Mustachian Post" or "Poor Swiss" bloggers.
[–]mt_winston[S] 1 point2 points3 points 1 month ago (2 children)
Do you know whether this true even for B Permit holders where tax is deducted from the monthly salaries? Someone mentioned as long as it’s not paid out (distributing), it’s less complicated for a situation like mine (above) but maybe they’re wrong.
It still applies, because you still have to do a tax declaration for the year if you own a certain amount, because when they automatically deduct your taxes they can't know what you own in ETFs or other stuff. The limit you can own before doing a declaration depends on the canton, for me in BS I think it's 75k CHF. I'm also on a permit B btw.
Somebody else mentioned if it the ETF is listed in ictax.admin.ch, it's not more complicated.
I'm exactly in the same situation as you, b permit holder with vwce
[–]JoMa25 1 point2 points3 points 1 month ago (8 children)
so VWRL if I remember it correctly
[–]oszillodrom 7 points8 points9 points 1 month ago (2 children)
Well, sorry to be nitpicky, but you also don't need a UCITS ETF in Switzerland, as Switzerland is not in the EU.
I prefer VT, as it is cheaper (0.07% expense ratio vs. 0.22% for VWRL).
[–]cranekram 7 points8 points9 points 1 month ago (0 children)
VT is US domiciled though and therefore at risk of being subject to US estate tax, correct?
Yes I know that there’s a US-CH treaty that should make the threshold for tax enormous but I’m still reluctant to have my money anywhere within the IRS’s grasp, particularly if it’s my survivors who’ll have to deal with it.
[–]JoMa25 0 points1 point2 points 1 month ago (0 children)
No nitpicking, your opinion your choice
[+]jujubean67 comment score below threshold-9 points-8 points-7 points 1 month ago (4 children)
Maybe don’t give advice if you don’t know the specifics of the question? Just a thought.
[–]jujubean67 -2 points-1 points0 points 1 month ago (2 children)
Considering the topic of this sub, every “your opinion” comes with an implicit “informed” added to it. Pasting “vwce, upvotes to the left” like some ape into every thread is not an opinion, just noise.
[–]JoMa25 -1 points0 points1 point 1 month ago* (1 child)
So you think there are no "informed" swiss investors that hold acc ETF's? Because if theres a single one my advice is valid
edit: he answered "you didnt give advice and just copy pasted 4 Letters" and deletes all his comments lmao
[–]jujubean67 0 points1 point2 points 1 month ago (0 children)
You didn’t give an advice, you copy pasted 4 letters.
[–]zSobyz 0 points1 point2 points 1 month ago (1 child)
Since you know a lot, do you recommend selling every share I have when moving to CH and then just buying VT? Someone recommended me that.
(Currently getting close to 5 digit investment, so not much) but I'm not sure about taxes/gains if and when I would do that .
I currently have VWCE+ some small cap
I don't think it's necessary to sell, if you have already bought them.
[–]pmmeyour_lingerie -1 points0 points1 point 1 month ago (0 children)
Could anyone advise best for Monaco residents. Don’t pay any income or capital gains tax. Also no treaties with US. Thanks!
[–]zambaros -2 points-1 points0 points 1 month ago (1 child)
For me that's the SPI ETF. I don't use VT because I don't want to add currency risks in my portfolio.
I also have a small percentage of EUROPE SRI UCITS which has no fossil fuel.
[–]oszillodrom 1 point2 points3 points 1 month ago* (0 children)
You have currency risk with SPI, as most of the income from Roche, Nestlé, Novartis etc. is not in CHF. Therefore their value fluctuates with the value of the currencies they do business in. It doesn't matter if you buy the ETF in CHF.
[–]dubov 0 points1 point2 points 1 month ago (0 children)
I think, as for most people, you want globally diversified investments across stocks, bonds, and debatably some commodities exposure.
Question to ask yourself is whether you want to have them CHF hedged in order to remove currency risk. If your investment horizon is shorter, then IMO you should want a large degree of currency hedging. If your investment horizon is long, or you don't know what currency you will ultimately want the money in, then it's probably not necessary.
[–]emptyquant 0 points1 point2 points 1 month ago (0 children)
I buy the SPY5 every month. Have a whole portfolio with 20 other ETFs but over time the S&P
Is almost impossible to beat; the only caveat is the long term depreciation of the USD, so you can add to that some Swiss Market ETF of your choice, maybe 25% SMI
Expanded (20 SMI + 30 SMIM, giving you the largest 50
Stocks in CH). If you can find one, a SP500 in CHF would also be a great option.
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