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-   -   VIAC 3rd Pillar - ROI seems off (https://www.englishforum.ch/finance-banking-taxation/301396-viac-3rd-pillar-roi-seems-off.html)

Rozelina 24.11.2020 20:26

VIAC 3rd Pillar - ROI seems off
 
Hi all,

Hope you are doing well.

As many here probably, I am using VIAC app for my 3rd pillar and I am 97% invested in equities. There is something going on with the ROI of my account which I cannot wrap my head around it and I would appreciate if someone sheds some light on it.

Being almost fully invested in equities, during March bottom my account was -18.51% down. As of today my account is +10.38% up. Now, using as benchmark SPY (please see screenshot attached), which has increased by 66% since March bottom, it looks like whatever funds VIAC is investing in is not even returning half of what SPY did since Mar20. Unless if they have too high managements fees or some other hidden costs which I cannot see. Am I missing something here or being paranoid for believing somethings seems off with VIAC?

https://ibb.co/KqTFSLD

roegner 24.11.2020 20:37

Re: VIAC 3rd Pillar - ROI seems off
 
If I look here:

https://www.etf.com/SPY#overview

I do not see 66% increase this year? What is it you are investing in?

Rozelina 24.11.2020 21:07

Re: VIAC 3rd Pillar - ROI seems off
 
Hi roegner

Mar bottom SPY price 219, current price 363. That’s a total of ~65% appreciation.
In my VIAC account I have chosen CSIF SPI Extra 35% CSIF US 35% CSIF World ex.CH 25%

Hope that makes it clear enough

DUTCH 24.11.2020 21:17

Re: VIAC 3rd Pillar - ROI seems off
 
1. SPI (Switzerland), World, US Equity markets all behaved differently, you cannot compare them to SPY (S&P) returns.
2. Evidence of this, SPY dropped circa 33% in March sell-off, while your strategy was only down 18%
3. There is a currency angle to be taken into account. SPY is all USD, your portfolio is not 100% USD. As example CHF is about 6% stronger compared to USD in 2020.


Bottomline, nothing sinister going on in VIAC. HTH.

Rozelina 24.11.2020 21:32

Re: VIAC 3rd Pillar - ROI seems off
 
Hi Dutch and thanks for your answer. I agree with the FX point, I completely missed that part. I am not sure though I understand what you mean by "SPY dropped...18%" Excluding Travel and Oil industry, pretty much everything else has doubled (in some cases tripled) price wise, with new ATHs. Donít you think VIAC funds seem to be underperforming vs VTI for example which is up ~70% since March bottom.

Quote:

Originally Posted by DUTCH (Post 3242550)
1. SPI (Switzerland), World, US Equity markets all behaved differently, you cannot compare them to SPY (S&P) returns.
2. Evidence of this, SPY dropped circa 33% in March sell-off, while your strategy was only down 18%
3. There is a currency angle to be taken into account. SPY is all USD, your portfolio is not 100% USD. As example CHF is about 6% stronger compared to USD in 2020.


Bottomline, nothing sinister going on in VIAC. HTH.


HickvonFrick 24.11.2020 22:14

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Rozelina (Post 3242558)
Hi Dutch and thanks for your answer. I agree with the FX point, I completely missed that part. I am not sure though I understand what you mean by "SPY dropped...18%" Excluding Travel and Oil industry, pretty much everything else has doubled (in some cases tripled) price wise, with new ATHs. Don’t you think VIAC funds seem to be underperforming vs VTI for example which is up ~70% since March bottom.

VTI started the year at 164.98 - now its 187.61 - an increase of 13.71% in USD. SP500 is 12.30% up YTD

You are 10.38% up in CHF according to your original post - so something like 16% up in USD given the abovementioned 6% strengthening of the franc. IE you have actually overperformed both VTI and SPY - and with less volatility, generally considered a good thing (you went down less but up less).

16% in USD is a good performance.

I'm up 11.97% in CHF in my VIAC so similar - I put some in NASDAQ explaining the difference.

Dr Mick 24.11.2020 22:29

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Rozelina (Post 3242558)
Hi Dutch and thanks for your answer. I agree with the FX point, I completely missed that part. I am not sure though I understand what you mean by "SPY dropped...18%" Excluding Travel and Oil industry, pretty much everything else has doubled (in some cases tripled) price wise, with new ATHs. Donít you think VIAC funds seem to be underperforming vs VTI for example which is up ~70% since March bottom.

-20% to +10% requires a ~35% price appreciation, assuming no fresh money has been added. Is that the case?
Also, your US exposure is 35% + 2/3 * 25% ~= 52%, that is, approximately half that of SPY/VTI.

Finally, and this is rather important, bear in mind that rebalancing occurs every month. How have non-US stocks performed this year?

Not everything apart from oil and travel has doubled. As an example, the STOXX Europe 600 index is down ~5% YTD in Euro (this index is overweight on banks/financials)
https://www.ishares.com/ch/individua...ts-etf-de-fund

poot 25.11.2020 09:20

Re: VIAC 3rd Pillar - ROI seems off
 
You can always change to a personally-selected portfolio, then you see exactly which funds you're in and the % allocation. But as someone mentioned, rebalancing does occur. And this option is not really for less experienced investors

aSwissInTheUS 25.11.2020 11:31

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Dr Mick (Post 3242573)
-20% to +10% requires a ~35% price appreciation, assuming no fresh money has been added. Is that the case?
Also, your US exposure is 35% + 2/3 * 25% ~= 52%, that is, approximately half that of SPY/VTI.

Adding to that: The selected "CSIF US ESG Ė Pension Fund" does not reflect the S&P 500. That would be "iShares Core S&P 500" or a bit broader, but not as broad as VTI the "UBS ETF MSCI USA SRI"
https://viac.ch/en/pillar-3a/strategies/

"CSIF US ESG Ė Pension Fund" tracks the MSCI USA ESG Leaders
https://www.msci.com/documents/10199...2-3c0ec1f38dd5

gipfelisturmer 26.11.2020 10:28

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Rozelina (Post 3242532)
As many here probably, I am using VIAC app for my 3rd pillar and I am 97% invested in equities.

...

using as benchmark SPY (please see screenshot attached), which has increased by 66% since March bottom, it looks like whatever funds VIAC is investing in is not even returning half of what SPY did since Mar20.

Well, quite simple really.

Global 100 (97% stocks) contains less than 32% of US (the fund that ASITUS above linked to).
So you only got roughly 1/3 of the US (mental) rise, and then whatever else might have been tacked on by CH, rest of the developed and emerging world.

Was that not obvious to you when you were choosing the allocation strategy?

Rozelina 27.11.2020 21:06

Re: VIAC 3rd Pillar - ROI seems off
 
Thank you all for your inputs. Very helpful.

Yes I agree World and CH has not followed the same pattern such as US which is only a part of my exposure.

Which individual strategy would you guys recommend (which funds specifically from the ones available) to be as close as possible to VTI? I know I need to stick with minimum 35% allocated to CH, but I would like the rest 60% focused on US. Do you think moving everything from CSIF US – Pension Fund and CSIF World ex CH – Pension Fund to iShares Core S&P 500 would be a better option considering though the higher TER I would need to pay for it?

On a side note, I agree that US stock market has been going mental since March bottom, but I am not gonna fight the trend.

HickvonFrick 27.11.2020 22:00

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Rozelina (Post 3243839)
Thank you all for your inputs. Very helpful.

Yes I agree World and CH has not followed the same pattern such as US which is only a part of my exposure.

Which individual strategy would you guys recommend (which funds specifically from the ones available) to be as close as possible to VTI? I know I need to stick with minimum 35% allocated to CH, but I would like the rest 60% focused on US. Do you think moving everything from CSIF US – Pension Fund and CSIF World ex CH – Pension Fund to iShares Core S&P 500 would be a better option considering though the higher TER I would need to pay for it?

On a side note, I agree that US stock market has been going mental since March bottom, but I am not gonna fight the trend.

For vti i think us Pension fund would be closest. Us Pension fund and sp500 will be very similar but the former is a bit cheaper and I suspect a marginally better performer as it includes smaller companies.

I'd personally maximise NASDAQ then us pension fund and for the Swiss equities I'd choose exclusively small cap. That's for seeking the highest performance.

Next year I'm going for finpension which seems to be an improvement on viac. 99 rather than 97% equities and no fx fees.

Rozelina 28.11.2020 01:22

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by HickvonFrick (Post 3243854)
For vti i think us Pension fund would be closest. Us Pension fund and sp500 will be very similar but the former is a bit cheaper and I suspect a marginally better performer as it includes smaller companies.

I'd personally maximise NASDAQ then us pension fund and for the Swiss equities I'd choose exclusively small cap. That's for seeking the highest performance.

Next year I'm going for finpension which seems to be an improvement on viac. 99 rather than 97% equities and no fx fees.

Is Finpesion a new player in the market? Never heard of them. Mind giving a bit more info about them on how they compete with VIAC?

HickvonFrick 28.11.2020 02:12

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by Rozelina (Post 3243901)
Is Finpesion a new player in the market? Never heard of them. Mind giving a bit more info about them on how they compete with VIAC?

Yup it's brand new.

https://thepoorswiss.com/finpension-3a-review/

See especially the not at the bottom discussing the advantages over VIAC

Rozelina 28.11.2020 12:41

Re: VIAC 3rd Pillar - ROI seems off
 
Quote:

Originally Posted by HickvonFrick (Post 3243904)
Yup it's brand new.

https://thepoorswiss.com/finpension-3a-review/

See especially the not at the bottom discussing the advantages over VIAC

Seems very good to me. Thepoorswiss articles always have great content. Lower fees overall and freedom to invest 99% in equities. Glad to see some new players heating up the competition.


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