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  #221  
Old 09.11.2017, 08:55
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Re: Interactive brokers in Switzerland

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A what benefit?

It's a curse in some jurisdictions. (Fortunately not in Switzerland)
If there is no capital gains tax it seems there is no problem to buy and sell at the same time. I have done it with securities and it is the same essentially (other than accounting entries). You need some sophistication to do this tbh, not for the ordinary investor.
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  #222  
Old 09.11.2017, 09:15
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Re: Interactive brokers in Switzerland

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Maybe I am completely misunderstanding what you mean here but if I bought a stock for 163 and it's now worth 212, then selling the stock would not allow me to buy more
Non sense, you can buy as much as you want. If only you can afford it, that is

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and keep the long-term advantages of a lower overall cumulative price
Low cost basis would become a huge disadvantage if you would have to pay capital gains taxes for any reason.

Like, planning on moving to US? Sell everything you've got before the move

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averaging up) upon buying more stocks. If I sell now I get a one-time gain and then start from scratch.
It seems you have some kind of psychological problem with it, I don't know, but there's absolutely no difference here strictly economically and mathematically, except for a small random market price risk due to delay and buying/selling from different markets, transaction costs and capital gains taxes in some cases
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  #223  
Old 09.11.2017, 09:18
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Re: Interactive brokers in Switzerland

Some people like to make their lives unnecessarily complicated. If you want to jump through all the hoops to try to exchange shares from one exchange to another, be my guest. It sounds like an exercise in futility to me.

Sell the old shares, buy the new shares. You'll have solved the problem in 15 minutes, and will have a higher cost-basis in case you ever move to a country that imposes capital gains tax. Win-win.
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  #224  
Old 09.11.2017, 09:43
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Re: Interactive brokers in Switzerland

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Some people like to make their lives unnecessarily complicated. If you want to jump through all the hoops to try to exchange shares from one exchange to another, be my guest. It sounds like an exercise in futility to me.

Sell the old shares, buy the new shares. You'll have solved the problem in 15 minutes, and will have a higher cost-basis in case you ever move to a country that imposes capital gains tax. Win-win.
Still he will need to borrow cash until the sale is settled.
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  #225  
Old 09.11.2017, 09:47
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Re: Interactive brokers in Switzerland

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Still he will need to borrow cash until the sale is settled.
Or accept the very small risk that the stock will make a big move over the 3 days it takes for the cash to settle. Provided he doesn't sell right around earnings-announcement time or ex-dividend date, the stock is unlikely to fluctuate more than a couple of percent.
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  #226  
Old 09.11.2017, 09:48
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Re: Interactive brokers in Switzerland

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Non sense, you can buy as much as you want. If only you can afford it, that is

Low cost basis would become a huge disadvantage if you would have to pay capital gains taxes for any reason.

Like, planning on moving to US? Sell everything you've got before the move

It seems you have some kind of psychological problem with it, I don't know, but there's absolutely no difference here strictly economically and mathematically, except for a small random market price risk due to delay and buying/selling from different markets, transaction costs and capital gains taxes in some cases
I don't have any "psychological problem" with anything, I simply do not understand how I financially benefit from selling my shares now for a one-time, short-term profit, instead of either transferring them to a new platform or leaving them be and continue being able to continue to profit from their gains.

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Some people like to make their lives unnecessarily complicated. If you want to jump through all the hoops to try to exchange shares from one exchange to another, be my guest. It sounds like an exercise in futility to me.

Sell the old shares, buy the new shares. You'll have solved the problem in 15 minutes, and will have a higher cost-basis in case you ever move to a country that imposes capital gains tax. Win-win.
How am I 'jumping through hoops'? I am making a transfer request which if it goes through is great, otherwise I will keep it in a broker I already have set up. There is no making life difficult and no hoops I am jumping through that I can note, so please tone down the rhetoric.
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  #227  
Old 09.11.2017, 10:04
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Re: Interactive brokers in Switzerland

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I don't have any "psychological problem" with anything, I simply do not understand how I financially benefit from selling my shares now for a one-time, short-term profit, instead of either transferring them to a new platform or leaving them be and continue being able to continue to profit from their gains.
At worst, you are in the same position as you were before, except now all of your shares are sitting with Interactive Brokers.

The only difference is that you will have realized a profit (which has no tax consequences in Switzerland) instead of sitting on an unrealized profit. This will allow you to increase the cost basis of the new shares that you hold. This can only be a good thing -- if ever you move to a country that taxes capital gains, your basis for the gain will be higher and therefore the tax due will be lower.
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  #228  
Old 09.11.2017, 10:11
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Re: Interactive brokers in Switzerland

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At worst, you are in the same position as you were before, except now all of your shares are sitting with Interactive Brokers.

The only difference is that you will have realized a profit (which has no tax consequences in Switzerland) instead of sitting on an unrealized profit. This will allow you to increase the cost basis of the new shares that you hold. This can only be a good thing -- if ever you move to a country that taxes capital gains, your basis for the gain will be higher and therefore the tax due will be lower.
I would rather sit on an unrealized profit that I know is going to rise higher, than a realized one that I will regret selling too soon. Again please correct me, but I don't see how I will be liable for CGT if I am merely transferring my long-term positions to IB.

I am not going to be moving to any other country for the forseeable future, and intend to nationalize, so I have no concerns there.

Ultimately the way I see it, I either transfer my shares to IB for easier management, or keep all my current shares in a safe place with no yearly or inactivity costs like Cornertrader.ch and my only losses are the transfer fees from Postfinance.
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  #229  
Old 09.11.2017, 10:16
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Re: Interactive brokers in Switzerland

Does IB has all the companies from NYSE and NASDAQ? And what happens if the company that you are looking for is not listed?
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  #230  
Old 09.11.2017, 10:27
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Re: Interactive brokers in Switzerland

You first check with IB if the name you are looking can be traded there...
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  #231  
Old 09.11.2017, 10:47
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Re: Interactive brokers in Switzerland

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I would rather sit on an unrealized profit that I know is going to rise higher, than a realized one that I will regret selling too soon. Again please correct me, but I don't see how I will be liable for CGT if I am merely transferring my long-term positions to IB.
In either case, your profit will be the same. Why would you have any regrets?

Suppose you bought shares in Apple at $116 on Jan 1, 2017

Situation 1: You decide to sell them today for $176. You then immediately buy them back at $176 with Interactive Brokers. By the end of the year, the share price has risen to $200. Your total profit is $84, of which $60 is realized at $24 is unrealized. Your share basis price is $176 for CGT, if you ever become liable for CGT.

Situation 2: You continue to hold onto your original shares. At the end of the year, your profit is $84. The entire $84 profit is unrealized. Your basis price is $116 for CGT, if you ever become liable for CGT.
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  #232  
Old 09.11.2017, 10:52
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Re: Interactive brokers in Switzerland

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In either case, your profit will be the same. Why would you have any regrets?

Suppose you bought shares in Apple at $116 on Jan 1, 2017

Situation 1: You decide to sell them today for $176. You then immediately buy them back at $176 with Interactive Brokers. By the end of the year, the share price has risen to $200. Your total profit is $84, of which $60 is realized at $24 is unrealized. Your share basis price is $176 for CGT, if you ever become liable for CGT.

Situation 2: You continue to hold onto your original shares. At the end of the year, your profit is $84. The entire $84 profit is unrealized. Your basis price is $116 for CGT, if you ever become liable for CGT.
Are you taking into account 'averaging up' the stock prices by buying more to make the overall purchase price lower, than simply selling and then re-buying? Doesn't seem like it to me from the two examples you posted.
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  #233  
Old 09.11.2017, 11:14
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Re: Interactive brokers in Switzerland

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Are you taking into account 'averaging up' the stock prices by buying more to make the overall purchase price lower, than simply selling and then re-buying? Doesn't seem like it to me from the two examples you posted.
Maybe you can give a numerical example of what you mean and how you expect to benefit from averaging up. What you are saying doesn't make much sense to me at the moment. I suspect when you run the numbers, you'll get to the same answer.
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  #234  
Old 09.11.2017, 11:56
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Re: Interactive brokers in Switzerland

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Are you taking into account 'averaging up' the stock prices by buying more to make the overall purchase price lower, than simply selling and then re-buying? Doesn't seem like it to me from the two examples you posted.
You seem to be massively over complicating a very simple situation here.

If you sell at your current broker and purchase with a new one for the same price then nothing is changing except the broker. You will have the same number of shares at the same price you currently have (minus transaction fees, which will be lower than title transfer fees).
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  #235  
Old 09.11.2017, 12:24
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Re: Interactive brokers in Switzerland

I'm not registered with IB. I was wondering, do they have interest rate swaps and would it be feasible to use them as an alternative to a fixed rate CHF mortgage?
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  #236  
Old 09.11.2017, 12:43
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Re: Interactive brokers in Switzerland

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Maybe you can give a numerical example of what you mean and how you expect to benefit from averaging up. What you are saying doesn't make much sense to me at the moment. I suspect when you run the numbers, you'll get to the same answer.
Same as here... https://www.investopedia.com/terms/a/averageup.asp

My thoughts: are that selling the 33 shares I already bought at 163 for a one-time profit at 210 of approx. 1500 and then buying 100 new shares at 210, will not lead to a higher overall profit than if I keep my existing shares that I bought at 164 and purchase 100 additional shares for 210. This will bring my average price up to 194.8 for 100 shares:
  • 33*163 (current number of shares and price I obught for) + 67*210 (planned next purchase) = 19449.
  • 19482 / 100 (overall number of shares) = 194.8 (new average share price)

So as the shares continue to increase over the coming months and years the potential profit from having an overall aggregated share price of 194.8 is greater than the 1500chf profit I would lock in now by selling only 33 shares at 210 and then buying 100 new ones for 210.

Is that really way off target?

Last edited by Richdog; 09.11.2017 at 12:56.
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  #237  
Old 09.11.2017, 13:06
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Re: Interactive brokers in Switzerland

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My thoughts: are that selling the 33 shares I already bought at 163 for a one-time profit at 210 of approx. 1500 and then buying 100 new shares at 210, will not lead to a higher overall profit than if I keep my existing shares that I bought at 164 and purchase 100 additional shares for 210.
Nor will you have any loss except for transaction fees, that's the whole point. Transactions fees might very well be lower than what your broker would charge for the positions transfer such as CHF 108 per security incl. 8% VAT at Postfinacne plus CHF 100/hour "for special expenses" which, who knows, a cross-CSD transfer might just turn out to be

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This will bring my average price up to 194.8 for 100 shares:
And why you do care about that, exactly? It doesn't matter - you can jerk all you want over your past performance, celebrate and mourn past trades but it won't change in the slightest where you're standing now. And when it does matter - if you were to pay capital gains taxes on it eventually, it's a good thing that your average price is as high as possible.

Last edited by ivank; 09.11.2017 at 13:36.
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  #238  
Old 09.11.2017, 13:26
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Re: Interactive brokers in Switzerland

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Same as here... [url]
  • 33*163 (current number of shares and price I obught for) + 67*210 (planned next purchase) = 19449.
  • 19482 / 100 (overall number of shares) = 194.8 (new average share price)
Whereas if you sell the old shares and buy back 100 shares at 210, you'll spend 21'000 and have an average share price of 210. Which sounds bad, until you realize that you have 1'500 realized profit sitting in your pocket. Put that back into the equation (21'000 - 1'500) and you're exactly back where you started, at 19'500, or average share price of 195.

That's what everyone is trying to tell you -- it's a wash either way. Average share price has no meaning from a tax perspective. It's a philosophy of timing your investments.

The purchase price of a share, however, does matter from a tax perspective as it forms the basis of how capital gains are calculated. If you can sell without penalty, take the profit, and reinvest to increase your basis price, you absolutely should. In countries where there is capital gains tax, this is good practice and allows you to crystalize (tax-free) profits where you can offset against any realized capital losses, saving you tax in future years. Under US law, you have to wait 30 days before reinvesting in the same shares, otherwise the shares are treated as if you had never sold them (known as "bed and breakfasting")
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  #239  
Old 09.11.2017, 13:52
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Re: Interactive brokers in Switzerland

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Same as here... https://www.investopedia.com/terms/a/averageup.asp

My thoughts: are that selling the 33 shares I already bought at 163 for a one-time profit at 210 of approx. 1500 and then buying 100 new shares at 210, will not lead to a higher overall profit than if I keep my existing shares that I bought at 164 and purchase 100 additional shares for 210. This will bring my average price up to 194.8 for 100 shares:
  • 33*163 (current number of shares and price I obught for) + 67*210 (planned next purchase) = 19449.
  • 19482 / 100 (overall number of shares) = 194.8 (new average share price)

So as the shares continue to increase over the coming months and years the potential profit from having an overall aggregated share price of 194.8 is greater than the 1500chf profit I would lock in now by selling only 33 shares at 210 and then buying 100 new ones for 210.

Is that really way off target?
in scenario 1, you have 33 shares and buy another 67. at the end, you have 100 shares.

in scenario 2, you have 33 shares, you sell 33 shares and buy 100 shares. at the end you have 100 shares.

33 + 67 = 100
33 - 33 +100 = 100

so whatever the value of shares you have in the future, will be the same, so the profit will be the same.

like i said, try to do the full calculation and work out your profit in both scenarios and see if they are really different.
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  #240  
Old 09.11.2017, 14:16
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Re: Interactive brokers in Switzerland

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like i said, try to do the full calculation and work out your profit in both scenarios and see if they are really different.
Have a look at the post just above yours. I did the math.
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