How can I best invest my money?

Numerous studies have shown that around 70 to 80 percent of the success of your long-term financial investments depends on the investment strategy you select. A key factor in choosing an investment strategy is your personal risk tolerance and risk capacity. This will dictate how you should spread your money across various asset classes, such as equities and bonds, as well as across different markets, such as Switzerland, the US or Europe. 

What is a realistic return?

Many banks, financial advisors and fund managers lure customers with the promise of an excess return over the market. However, a number of studies have shown that almost nobody is able to consistently outperform the market – on the contrary. A far more realistic goal is to gain and lose a similar amount as the market as a whole. The best way to achieve this is with index funds and ETFs as they replicate the performance of an index.

How well is my securities portfolio performing compared to others?

Securities portfolios frequently contain a large amount of proprietary products. The more they contain, the lower the returns compared to the return generated by the index. The reason for this is that proprietary products are usually actively managed funds, which charge far higher fees than index funds or ETFs, yet frequently perform worse. How well is your securities portfolio performing compared to the index and other investors? Get a securities portfolio check now.

Am I paying too much for my financial investments?

Many banks charge excessive deposit and transaction fees. There are also the fees incurred directly for the financial products used. These often amount to 1.5% per year or more for actively managed funds. It is possible to save a lot of money if you choose ETFs over active funds and move your portfolio to a cheaper bank. Over a ten-year period, a securities account containing 500,000 francs will rise in value by 31,000 francs more if the  rate of net return can be increased from 2% to 2.5% thanks to lower fees. After 20 years, this figure would rise to more than 76,000 francs. 

Why should I invest in ETFs and index funds?

ETFs and indexed funds are cost-effective, transparent and liquid and are therefore especially suited to private investors wishing to build up their assets over the long term. Both aim to replicate a market index, such as the SMI, as closely as possible. By choosing ETFs or index funds, investors are not taking on large risks as they will always gain and lose about the same amount as the markets. This is a sensible approach as even professional investors, such as banks or fund managers, rarely manage to consistently outperform the market. 

Should I invest in Bitcoin and other cryptocurrencies?

An increasing number of investors are interested in digital currencies based on blockchain technologies. The coming years will show whether this trend will catch on in the financial industry. Cryptocurrencies are set to remain a speculative investment, which could fit into a securities account geared to the long term. Purchases and sales can be processed via VZ Depository Bank.

How can I invest on a sustainable basis?

The choice of funds and ETFs which specialise in sustainable investments is becoming ever larger and more confusing. But not all investments that brand themselves as "sustainable" would meet objective sustainability criteria. For instance, many investors assume that such investments contribute positively to the climate. However, this is a common misunderstanding. In addition, the environment frequently scores lowest in sustainability ratings. More importance is often placed on aspects such as society and corporate governance.

Sustainable investing with VZ

How can I prevent inflation decimating my portfolio?

If inflation is higher than interest rates, your savings will lose value. Investors should therefore take measures to limit any losses in purchasing power. In the past, tangible assets have proven successful – for example shares in well financed companies with high pricing power. Real estate also offers a certain level of protection against inflation. Certain bonds also aim at protecting against inflation.

Does it make sense to invest my money as a pension fund would?

For retirees and those about to retire, it is a good idea to base your approach on the investment strategies pursued by pension funds, which are among the most successful investors in Switzerland. They don’t take any undue risks and largely invest in equities, bonds and real estate. They also focus on investment instruments with regular payouts.

How do I find the right portfolio manager?

Many banks are not only portfolio managers, but also structure their own financial products, such as investment funds or structured products. This leads to conflicts of interest. If banks invest their portfolio management clients’ funds in their own products, they profit twice over: They earn fees for managing the securities accounts as well as on the products themselves. Portfolios managed by banks therefore often contain a large number of proprietary products, which demonstrably reduces the returns generated within the portfolios.