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-   -   Online trading in Swizerland (https://www.englishforum.ch/finance-banking-taxation/210600-online-trading-swizerland.html)

jacktorrance 09.06.2014 11:39

Online trading in Swizerland
 
Hello all,

I know there is other topics on the subject but some are a bit hold and don't answer some of my questions. Thanks in advance for your help.

I am a swiss citizen, living in ch, with less than 5000 chf to invest. I also have a ssn due to the fact that I worked in the US. Although I have been reading extensively on the subject lately, I am also totally new in investing so pardon my ignorance.

I am looking for the best, cheapest option for onlike trading (stock, mutual funds..). I plan to do mostly long term "buy and hold" on Swiss, European and American markets

A lot of people here have been talking about Interactive Brokers and Saxo Bank, but they both have a minimum equity deposit in cash or stock of USD 10,000. My researches to far have pointed out the best alternative might be strateo

Here are ma questions

1) What do you think about Strateo's fees. Especially custody fees
https://www.strateo.ch/en/prices

2) What do you think would be the best option for long term investing in Switzerland. Would it be wiser to use another platform like swissquote or postfinance? Again im looking for the cheapest option as I don't have a lot of money to invest

newbie questions:

3) What happens if the online brokers you are using fails? Do you loose all your investment? Then would is be wiser to use a larger online broker company?

4) If I buy multiple same company stock at once, do I pay the transaction fee for each stock or once for all the stocks?

5) Can you choose the currency of your account when opening one? What are the plus/minus of using usd versus chf when investing in multiple markets?

Thanks all for your time,

Sbrinz 09.06.2014 11:56

Re: Online trading in Swizerland
 
Have you looked at Swiss Post Finance, you can trade small amounts there.

fatmanfilms 09.06.2014 12:24

Re: Online trading in Swizerland
 
Quote:

Originally Posted by Sbrinz (Post 2173747)
Have you looked at Swiss Post Finance, you can trade small amounts there.

However terribly high minimum charges. I would use Schwab or TD Ammeritrade due to low fees.

Stocks should be held in a nominee account, so not at risk in theory. Schwab or TDA have a flat dealing charge of under $10 regardless of the value of the trade.

In Switzerland you have to pay stamp duty on foreign trades.....

Bernet83 09.06.2014 20:09

Re: Online trading in Swizerland
 
I use "etoro.com", they are not Swiss but the provide a social platform. Quite nice and friendly.

miba 14.06.2014 16:25

Re: Online trading in Swizerland
 
Given your fresh experience in investing, you should take a look at investing in an Index Fund.

PostFinance offers a number of funds (by known asset managers) which they select based on their performance the previous year. Their fees are also very reasonable. They charge 1.0% when you buy (or 0.5% if you have a private account plus), selling is free of charge, and they have no custody fees. Depending on your horizon, one suggestion is a Post Finance Fund, they all cover the swiss market but differ by the equity (stocks) / fixed income (bonds) allocation. The more long term you plan to hold the fund, the more equity can be allocated.
https://www.postfinance.ch/en/priv/p...und/offer.html

An advantage when investing in an index fund (which is nothing else but a baskets of stocks and bonds), is that your risk is distributed along all the components of the basket, so if one of the stocks in the basket plunges, the impact on your investment is mitigated. What I also like about Post Finance, is that you can automatically invest a specific amount each month in a fund. That way you benefit from the "average cost basis" method, which tends to beat a one-time buy and hold strategy.
See http://www.investopedia.com/terms/a/...asismethod.asp

My 2 cents.

fatmanfilms 14.06.2014 17:01

Re: Online trading in Swizerland
 
1% on an index fund is insanely high

miba 14.06.2014 21:25

Re: Online trading in Swizerland
 
It as a trading fee at the end of the day.
Given 5000 CHF, it would be 50 CHF, with the private account plus it's 25 CHF instead, which is inline with what other trading platforms charge.
However, there is no custody fee or fee for selling (which is not the case with SwissQuote or InteractiveBrokers).

Trading on InteractiveBrokers is cheaper, you could trade for as low as 1$ and some ETFs are free of charge (they make their money on the spread).
However, the minimum monthly trading cost at InteractiveBrokers is 10$ (9 CHF), which doesn't include any price feed (an additional 10 CHF for SIX Level 1 pricing).
Considering all these costs, you're at 228 CHF in yearly recurring costs at IB. Investing 5000 CHF, that's 4.56% of your investment which you need to recover before making any profits.

PostFinance beats it.

Wise 15.06.2014 20:40

Re: Online trading in Swizerland
 
I think Strateo is a good option. I personally tried almost all of them and in terms of fees and service, I appreciate Strateo. Custody fees are more than fair. You will never pay more than 25 francs per quarter, I pay 10 francs and all other costs are transparent.
I also invested couple of thousand francs in ETFs and I took advantage of their ETF leader promotion. It's a flat fee which is 9 francs.
I also double checked before investing and I know that they have a swiss banking licence which is not given by brokers like interactive brokers. No worries, your securities are always protected. You won't lose them and money is protected till 100'000 francs (Swiss deposit guarantee system).
I had also multi currency account automatically. They offer for free a multi currency account to all their clients. So no matter which currency you invest, you won't lose because of currency change - my base currency is CHF
So good look :)

ritzdank 04.03.2016 16:28

Re: Online trading in Swizerland
 
Quote:

PostFinance beats it.
I am fairly new to investing and my interest got actually triggered through a meeting with an adviser from Postfinance who called me one day. Apart from trying to sell me a life insurance (thanks but no), he suggested that I could invest a reasonable part of my cash assets in bonds and/or funds.

So, I made the decision to open an e-trading account and to invest 50k. I was intrigued by the idea of "dollar cost averaging" (investing once every month/quarter/year instead of investing the entire 50k). Before doing the necessary clicks, I stumbled upon two books (The intelligent investor and A random walk down wallstreet) and luckily read them. The problem now is, that I am much more aware of the potential risks and opportunities which actually makes me feel more paralyzed than before. Not only taking risks, but also facing incredible differences in fees make me hesitant to start using the Postfinance account (especially after looking at Schwab, TD Ameritrade). Both authors remind you constantly that if you are on low risk, yields won't be higher than 2-4% which means keep you broker fees as low as possible.

Coming back to your comment:

Quote:

Given 5000 CHF, it would be 50 CHF, with the private account plus it's 25 CHF instead, which is inline with what other trading platforms charge.
However, there is no custody fee or fee for selling (which is not the case with SwissQuote or InteractiveBrokers).
Can you confirm that 1% are the only fees occurring? After looking at their PDF (Fund costs and sales remuneration), they also mention transaction fees called Courtagen in German) which are "quite" high for example, for a SIX Structured Product, it is 25CHF (for investments from 0-5k). If that's true, if you would like to invest let's say 500CHF each month you would have. 1% issuing fee 5CHF + 25CHF = 30CHF (That's already 6% in fees of the amount invested! 360CHF/per year investment costs). On top of that, you have for their own products (Postfinance Bond Fund 1) a TER of 0.79%. It will be hard to make any profit given that you would like to invest regularly.

I am tempted to open an account at Ameritrade (their choice of ETFs is also much bigger than with PF), since they offer 100+ commission-free ETFs which means dollar-cost averaging with no commissions.

Thanks for any further advice/experience!

fatmanfilms 04.03.2016 17:52

Re: Online trading in Swizerland
 
Quote:

Originally Posted by ritzdank (Post 2549002)
I am tempted to open an account at Ameritrade (their choice of ETFs is also much bigger than with PF), since they offer 100+ commission-free ETFs which means dollar-cost averaging with no commissions.

Thanks for any further advice/experience!

You have to use those trades quite quickly, within 3 months or less.

Dollar-cost averaging is a waste of time of your a long term investor, your just as likely to pay more in a rising market than pay less in a falling market.
It's a life insurance salesman's way of getting you to invest monthly as his commission is based on possibly 25 years of investment :msnnerd:

Richdog 10.09.2017 09:07

Re: Online trading in Swizerland
 
Hey guys. I have recently made a decision to start trading in stocks instead of leaving my savings in a low interest savings account.

I have already traded around 20% of my allocated funds and I used the PostFinance E-trading platform which I thought looked decent and is also incredibly convenient for me as a PostFinance account holder. However I then did some more searching for threads l.ike this and saw that it may not be the wisest choice to use. My questions are:
  1. What is the best value trading system to use for the long-term, going forward form this point?
  2. Now that I have bought shares from PF, when I switch platforms is there any way of allowing another trading system to see the shares I have bought or are they now only viewable on the PostFinance E-trading system?

Thanks in advance for any insight you can give me. :)

fatmanfilms 10.09.2017 10:28

Re: Online trading in Swizerland
 
Quote:

Originally Posted by Richdog (Post 2844492)
Hey guys. I have recently made a decision to start trading in stocks instead of leaving my savings in a low interest savings account.

I have already traded around 20% of my allocated funds and I used the PostFinance E-trading platform which I thought looked decent and is also incredibly convenient for me as a PostFinance account holder. However I then did some more searching for threads l.ike this and saw that it may not be the wisest choice to use. My questions are:
  1. What is the best value trading system to use for the long-term, going forward form this point?
  2. Now that I have bought shares from PF, when I switch platforms is there any way of allowing another trading system to see the shares I have bought or are they now only viewable on the PostFinance E-trading system?

Thanks in advance for any insight you can give me. :)

Depends on what markets your trading, I always by UK or US shares in the US using Schwab. There is no stamp duty on UK shares traded as ADR's which is a huge saving.

No

Richdog 10.09.2017 10:31

Re: Online trading in Swizerland
 
Quote:

Originally Posted by fatmanfilms (Post 2844513)
Depends on what markets your trading, I always by UK or US shares in the US using Schwab. There is no stamp duty on UK shares traded as ADR's which is a huge saving.

No

Cheers fattie. Ideally I just want to use one single .platform, and I will be trading mainly tech industry shares on SIX/NYSE. :)

fatmanfilms 10.09.2017 11:23

Re: Online trading in Swizerland
 
Quote:

Originally Posted by Richdog (Post 2844515)
Cheers fattie. Ideally I just want to use one single .platform, and I will be trading mainly tech industry shares on SIX/NYSE. :)

If the shares on the SIX are also traded in the US, which many will be I would go with a US Broker. (No Swiss stamp duty :D). Most smaller / new tech companies will choose a NASDAQ listing in any case.

Richdog 10.09.2017 11:50

Re: Online trading in Swizerland
 
Quote:

Originally Posted by fatmanfilms (Post 2844523)
If the shares on the SIX are also traded in the US, which many will be I would go with a US Broker. (No Swiss stamp duty :D). Most smaller / new tech companies will choose a NASDAQ listing in any case.

I bought my first stocks on SIX, should I really have bought them on NYSE then? Damn it.

Any particular trading platforms you can recommend? :)

Urs Max 10.09.2017 20:37

Re: Online trading in Swizerland
 
Quote:

Originally Posted by Richdog (Post 2844531)
I bought my first stocks on SIX, should I really have bought them on NYSE then? Damn it.

Any particular trading platforms you can recommend? :)

Using a Swiss broker doesn't necessarily mean you buy via SIX. Of the ~260 SIX-listed companies only ~40 are foreign. By necessity all others are traded abroad including virtually all listed on NYSE+NASDAQ.

Swiss stamp tax is 0.075% for domestic, 0.15% for foreign companies. Negligible if you buy to hold for many years.

Postfinance is usually a very good choice, both as bank and as broker.

Quote:

Originally Posted by fatmanfilms (Post 2549044)
Dollar-cost averaging is a waste of time of your a long term investor, your just as likely to pay more in a rising market than pay less in a falling market.

Depends. If you buy for a constant amount with each purchase you're wrong. You're right if you buy a constant number of stocks/ETF shares each time.

ivank 11.09.2017 07:35

Re: Online trading in Swizerland
 
Quote:

Swiss stamp tax is 0.075% for domestic, 0.15% for foreign companies. Negligible if you buy to hold for many years.
Go with a discount american broker (Schwab, IB, and so on) and the costs will be negligible even if you buy and hold for a single day!! You also forgot currency conversion fees, which easily amount to 1-2% with swiss brokers. And higher dividend withholding taxes: 30% "thanks for choosing swiss" instead of normal 15% on american stocks.

Quote:

Postfinance is usually a very good choice, both as bank and as broker.
I beg to differ, shitty choice like most swiss brokers, very expensive. Btw, if you didn't know, swiss deposit protection doesn't cover securities...

Troublawesome 11.09.2017 23:28

Re: Online trading in Swizerland
 
www.degiro.ch

Richdog 12.09.2017 09:01

Re: Online trading in Swizerland
 
Quote:

Originally Posted by ivank (Post 2844871)
Go with a discount american broker (Schwab, IB, and so on) and the costs will be negligible even if you buy and hold for a single day!! You also forgot currency conversion fees, which easily amount to 1-2% with swiss brokers. And higher dividend withholding taxes: 30% "thanks for choosing swiss" instead of normal 15% on american stocks.


I beg to differ, shitty choice like most swiss brokers, very expensive. Btw, if you didn't know, swiss deposit protection doesn't cover securities...

Hmm also Moneyland does a comparison and PF looks like it ain't exactly cheap... https://www.moneyland.ch/en/onlineTrading/list

This is tough finding out which broker to use. Is the general consensus that IB (Interactive Brokers) is the best one? https://www.interactivebrokers.com/en/home.php

If so can I 'transfer' my shares from PF to IB, or are they completely platform independent? Sorry for the noob questions... :o

EDIT - What about the top options here too? https://www.nerdwallet.com/blog/inve...stock-trading/

ivank 12.09.2017 09:29

Re: Online trading in Swizerland
 
Quote:

Originally Posted by Richdog (Post 2845497)
Hmm also Moneyland does a comparison and PF looks like it ain't exactly cheap... https://www.moneyland.ch/en/onlineTrading/list

That comparison's a total joke. What's the point in comparing among the most expensive options in the world?

Quote:

If so can I 'transfer' my shares from PF to IB, or are they completely platform independent?
Depends on what exactly did you buy and where it can be traded. Did you buy some of postfinance's own funds? Then you're probably locked to their platform and you have sell them first though PF. Vanilla stocks and ETFs freely tradeable on a major exchange can be transferred to a different broker, but there may be some fees for this service

Quote:

EDIT - What about the top options here too? https://www.nerdwallet.com/blog/inve...stock-trading/
Many good options, customer is king in US, not a victim, but a big advantage of IB for swiss investors is in cheap FX.


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