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Old 05.01.2011, 15:16
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Got quite some CHF any advice what to do with it as in Investing

I have quite some CHF in my bank account and i dont want it laying there doing nothing. Any advice as in what stocks are interesting at the moment, or maybe i should change it into a dif. currency now that CHF is so high..??

Thanks
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Old 05.01.2011, 15:18
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Re: Got quite some CHF any advise what to do with it as in Investing

I'll send my account details....
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Old 05.01.2011, 15:21
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Re: Got quite some CHF any advise what to do with it as in Investing

300000 chf buys you a house in aargau (not too far from ZH). This saves you 12x2000 = 24000chf in rent annually. This is an 8% return...
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Old 05.01.2011, 15:29
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Re: Got quite some CHF any advise what to do with it as in Investing

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300000 chf buys you a house in aargau (not too far from ZH). This saves you 12x2000 = 24000chf in rent annually. This is an 8% return...
300k is not going to get you a habitable house in Aargau, particularly not in the south of the Kanton.

You can however pick up a flat for this sum.
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Old 05.01.2011, 16:34
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Re: Got quite some CHF any advise what to do with it as in Investing

Is above really how people calculate returns on investments?
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Old 05.01.2011, 16:41
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Re: Got quite some CHF any advise what to do with it as in Investing

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Is above really how people calculate returns on investments?

Here's how I calculate not buy apple products (and instead by their stock)

http://www.kyleconroy.com/apple-stock.php
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Old 05.01.2011, 16:46
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Re: Got quite some CHF any advise what to do with it as in Investing

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Is above really how people calculate returns on investments?
more or less... roughly... kinda sorta ... in a nutshell ... yes

with more realistic numbers, of course..
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Old 05.01.2011, 16:51
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Re: Got quite some CHF any advice what to do with it as in Investing

I am relativly new to this group but does anyone do investment clubs or anything like that here. I think that is the best way for people to learn, and subsequently invest, thier money. I have never tried it but have always been intrigued by it and would be willing to.
The investment question gets asked a lot and I know a lot of poeple who are totally lost on this very important sudject.
It may be something to start - and many questions could be answered, with lots of analysis done to follow-up potential investments.
Good luck for now
pops
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Old 05.01.2011, 17:08
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Re: Got quite some CHF any advise what to do with it as in Investing

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300000 chf buys you a house in aargau (not too far from ZH). This saves you 12x2000 = 24000chf in rent annually. This is an 8% return...
Don't they adjust your taxable income upwards for the rent you're not paying? Then factor in that mortgage interest here is tax deductible (I think)...and basically Switzerland makes buying a house almost as complicated as laundry day here...
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Old 05.01.2011, 17:10
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Re: Got quite some CHF any advice what to do with it as in Investing

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The investment question gets asked a lot and I know a lot of poeple who are totally lost on this very important sudject.

pops
ok here is the best piece of advice you're ever gonna get pops...

"keep it in the bank!"
"don't give up your day job!"

Ok that was two pieces of advice... both are for free
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Old 05.01.2011, 22:00
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Re: Got quite some CHF any advise what to do with it as in Investing

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300000 chf buys you a house in aargau (not too far from ZH). This saves you 12x2000 = 24000chf in rent annually. This is an 8% return...
And we here ignore not only the tax bill, but also maintenance costs, property tax, insurance, whathaveyou. And risk.
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Old 05.01.2011, 23:46
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Re: Got quite some CHF any advise what to do with it as in Investing

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And we here ignore not only the tax bill, but also maintenance costs, property tax, insurance, whathaveyou. And risk.
Do we also ignore the rent that is saved too??
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Old 05.01.2011, 23:50
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Re: Got quite some CHF any advise what to do with it as in Investing

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I'll send my account details....
Me 2, & I am a nicer guy
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Old 06.01.2011, 09:32
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Re: Got quite some CHF any advise what to do with it as in Investing

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Do we also ignore the rent that is saved too??
No - if you look at the post I answered, the saved rent figured as pure return on investment, which I find quite optimistic to say the least.
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Old 06.01.2011, 10:33
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Re: Got quite some CHF any advice what to do with it as in Investing

Back on track, Swiss banks and Post Finance offer many funds for investing in shares. If you look at their growth history you might pick a future winner.

I was speaking to a Swatch manager on New Years' Eve and he confirmed that Swatch are expecting their best ever year in 2011.
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Old 06.01.2011, 11:04
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Re: Got quite some CHF any advice what to do with it as in Investing

Banks and independent financial advisors will be happy to take your money - and their commission - with figures that show you how their funds/investment plans have done so well.

However, the fact is that we remain in a very unstable investment market and no one knows what the future holds. If you are looking long-term (10 year or more) it is likely that most investments will show a profit of some sort. But I have ZKB funds from 1998 that are worth about the same they were when bought (and went 20% down). A UK pension fund that has lost 25% over the last 3 years and a further 25% due to the fall of the GBP.

For short term, I would stay in CHF and perhaps even be happy with the 0.375% interest on a deposit account.

Despite what those in rented property say against it as an investment, property has made many of my friends and acquaintances millionaires over the last 50 years and put a roof over their heads...
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Old 06.01.2011, 13:06
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Re: Got quite some CHF any advice what to do with it as in Investing

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300000 chf buys you a house in aargau (not too far from ZH). This saves you 12x2000 = 24000chf in rent annually. This is an 8% return...
Quote:
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Is above really how people calculate returns on investments?
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Don't they adjust your taxable income upwards for the rent you're not paying? Then factor in that mortgage interest here is tax deductible (I think)...and basically Switzerland makes buying a house almost as complicated as laundry day here...
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And we here ignore not only the tax bill, but also maintenance costs, property tax, insurance, whathaveyou. And risk.
I would compare two scenarios, with buying a house, and without.

Without buying a house you pay say 24k a year in rent. You also earn about 1.75% interest, well, I think you could get 2% if you were to lock in for the year but the highest comparis shows is 1.75% so let's go with that. Minus the tax on the interest, so about 75% of 1.75%, so 4k.

If you buy the house (as cash to simplify), you don't pay 24k a year in rent. Instead you pay property tax and full maintenance. Properrty tax looks like 1.5% in Aargau, maintence would probably be about 1%, so, now you're paying 7.5k a year. So you're better off by about 12.5k a year if you buy. If you a buy a house for 300,000 that is equivalent to paying 2,000 a month in rent. If you could rent for 1,000 a month in Aargau, then you're better off renting there, then buying there. And if you pay 700k for the same place in Zurich, then you're better off renting in Zurich.

To the OP, the best thing you can do is minimize your tax bill, max out your 3A account, make additional AVC's into your pension plan. Everything else involves an element of risk, and if anyone on this board had the perfect formula to make lots of money risk free I'm sure they would be smart enough not to give it away.

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Banks and independent financial advisors will be happy to take your money - and their commission - with figures that show you how their funds/investment plans have done so well.

However, the fact is that we remain in a very unstable investment market and no one knows what the future holds. If you are looking long-term (10 year or more) it is likely that most investments will show a profit of some sort. But I have ZKB funds from 1998 that are worth about the same they were when bought (and went 20% down). A UK pension fund that has lost 25% over the last 3 years and a further 25% due to the fall of the GBP.

For short term, I would stay in CHF and perhaps even be happy with the 0.375% interest on a deposit account.

Despite what those in rented property say against it as an investment, property has made many of my friends and acquaintances millionaires over the last 50 years and put a roof over their heads...
Mostly agree, investing in properties can make you money, as shown in the US, Ireland, and Spain quite recently it can also burn you, so be aware when investing in a property that you don't live in that it is a bet, not a sure thing.
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Old 06.01.2011, 13:57
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Re: Got quite some CHF any advice what to do with it as in Investing

Well done so far. I would say short any/all paper currencies, invest in something you enjoy. Paper will be worth less, but it is more difficult to predict which paper will fall most. Gold/Silver might go much higher or it might be peaking, but all currencies look set to buy less and less of everything from food, shoes, to bottled water. Some toys: A Ferrari 308, a 1980s 911, a classic VW Bug, Old Mini, a Swatch, a quality camera lens, some clothes you will want in 15 years, all look set to hold their own as a basket over 15 years against sterling/Euro. This could save on expenditure, if you get 15 years out of them.

A house bought with a mortgage. Nice properties are appearing on the market now. Perhaps a nice Multifamily house in the centre of Baden, Mellingen, Bremgarten, or Muri if you can get a 5%+ yield, 2 or 3 apartments, one for you, rather than buying one apartment cash in Aargau. Then if currencies stop falling and magically reverse in the face of world peace (interest rates climb more than apartment values netted against rental income), think of selling two and close out, while it is still cheaper for purchasers to buy off you rather than rent.

Your one third 300K apartment should have held your value, and you might profit on the others, while not having to do any maintenance yourself, while employing a hauswart, accountant, etc. Tax wise, mortgages look brilliant in Aargau so even 'not making any money' you can end up saving tax. If it works out, invite us round for a beer.

I am put off buying apartments in a block as you are at the mercy of landlords/other tenants that want to renovate shared facilities at your expense, replace heating systems for fun, etc.

Houses are great, but then only if you want a house, as you cannot offset costs for a private gardener, cleaner so easily against income.
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Old 06.01.2011, 14:13
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Re: Got quite some CHF any advice what to do with it as in Investing

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Well done so far. I would say short any/all paper currencies, invest in something you enjoy. Paper will be worth less, but it is more difficult to predict which paper will fall most. Gold/Silver might go much higher or it might be peaking, but all currencies look set to buy less and less of everything from food, shoes, to bottled water. Some toys: A Ferrari 308, a 1980s 911, a classic VW Bug, Old Mini, a Swatch, a quality camera lens, some clothes you will want in 15 years, all look set to hold their own as a basket over 15 years against sterling/Euro. This could save on expenditure, if you get 15 years out of them.
Most of those items would hold a storage / carrying cost. If you have infinite cold storage then go for it, otherwise be cautious. A car will rust if not stored in a properly dry garage, which will cost you something every month. Clothes will go moldy if not protected properly with dessicates. Gold and silver are highly speculative. Think of the person who bought gold at the peak in the early 1980's, it took them 30 years to get back to that spot.

Property in Switzerland is much more expensive than property in many other countries. Although the prices are competitive with rents, if fundamental economic conditions change in the next 10 years you'll be in trouble. For example the Swiss Franc is fairly high right now, even if the value of the CHF investment goes up, in terms of GBP it may be falling, and if you are looking to retire outside Switzerland that will hurt you.

Be wary of anyone with the perfect answer. Pay as little in tax as possible, and diversify.
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Old 06.01.2011, 14:32
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Re: Got quite some CHF any advice what to do with it as in Investing

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Most of those items would hold a storage / carrying cost. If you have infinite cold storage then go for it, otherwise be cautious. A car will rust if not stored in a properly dry garage, which will cost you something every month. Clothes will go moldy if not protected properly with dessicates. Gold and silver are highly speculative. Think of the person who bought gold at the peak in the early 1980's, it took them 30 years to get back to that spot.

Property in Switzerland is much more expensive than property in many other countries. Although the prices are competitive with rents, if fundamental economic conditions change in the next 10 years you'll be in trouble. For example the Swiss Franc is fairly high right now, even if the value of the CHF investment goes up, in terms of GBP it may be falling, and if you are looking to retire outside Switzerland that will hurt you.

Be wary of anyone with the perfect answer. Pay as little in tax as possible, and diversify.
& brutally high Swiss capital gains tax on property sales
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