Asset management mandates

How does the asset management mandate work?

Our asset management mandate with index investments invests money according to an investment strategy without experimentation. The asset comprises exclusively cost-effective index investments which efficiently replicate the relevant investment markets. The focus is on investments with good sustainability characteristics. An intelligent rebalancing process is applied to ensure the investment strategy is followed at all times. If an asset class exceeds or falls below the relevant bandwidth, it is returned to the original weighting taking into account the current market environment.

Who is the mandate suitable for?

The portfolio management mandate with index investments is suitable for investors who wish to place their money in a sustainable investment strategy without taking on any unnecessary risks. The mandate targets a level of returns in line with the market as it uses only index investments and sticks to its strategy, while implementing it in a cost-effective manner.

Which investment instruments do we use?

As part of the portfolio management mandate with index investments, we make use of cost-effective ETFs together with other index funds. Until recently, these were only available to institutional investors. The investment experts at VZ monitor all index funds traded on the Swiss stock exchange and apply a professional selection process to pick the best index funds for each asset class.

Why opt for index funds?

When you invest in an index fund, you are buying a share of an entire stock exchange index, for example the SMI. The aim of an index fund is for it to replicate an index identically. If the index goes up, so does the value of the index fund. In contrast to traditional investment funds, index funds are not actively managed funds, which try to outperform their relevant index by buying and selling securities. Over the long term, however, very few actively managed funds are able to outperform their benchmark index. And thanks to the low fees charged by index funds, investors benefit from higher returns over the long term.

What are the advantages of independent asset management?

With a asset management mandate, you transfer the responsibility for managing your securities to the investment experts at VZ. We put together individual solutions which focus on your needs. We analyse various markets and securities, make investment decisions and continually monitor the performance of your assets.

As we do not sell our own financial products and are not brokers, we can make these decisions without any conflicts of interest. This means we always use the investment instruments that perform well in our objective selection process.

How does the asset management mandate work?

Our asset management mandate with index investments focus ESG invests money according to an investment strategy without experimentation. In the investment process, criteria relating to environment, society and governance (ESG) are taken into consideration. The portfolio comprises exclusively cost-effective index investments which efficiently replicate the relevant investment markets. An intelligent rebalancing process is applied to ensure that the investment strategy is followed at all times. If an asset class exceeds or falls below the relevant lower limit of the range, it is returned to the original weighting taking into account the current market environment.

Who is the mandate suitable for?

The asset management mandate with index investments focus ESG is suitable for investors who wish to place their money in an investment strategy that takes no unnecessary risks and focuses on ESG criteria in the investment process. The mandate uses only index investments, intelligent rebalancing, independent and cost-efficient implementation and strongly adheres to its strategy, while taking ESG criteria into consideration.

Which investment instruments do we use?

As part of the asset management mandate with index investments, we make use of cost-effective ETFs together with other index funds. Until recently, these were only available to institutional investors. If possible, index funds that take ESG criteria into consideration are also used. The investment experts at VZ monitor all index funds authorised in Switzerland and apply a professional selection process to pick the best index funds for each asset class.

Why opt for index funds?

When you invest in an index fund, you are buying a share of an entire stock exchange index, for example of the SMI. The aim of an index fund is for it to replicate an index identically. If the index goes up, so does the value of the index fund. In contrast to traditional investment funds, index funds are not actively managed funds, which try to outperform their relevant index by buying and selling securities. Over the long term, however, very few actively managed funds are able to outperform their benchmark index. And thanks to the low fees charged by index funds, investors benefit from higher returns over the long term.

What are the advantages of independent asset management?

With an asset management mandate, you transfer the responsibility for managing your securities to the investment experts at VZ. We put together individual solutions which focus on your needs. We analyse various markets and securities, make investment decisions and continually monitor the performance of your assets.

As we do not sell our own financial products and are not brokers, we can make these decisions without any conflicts of interest. This means that we always use the investment instruments that perform well in our objective selection process.

How does the asset management mandate work?

With our asset management mandate with sustainable fund selection, we continually monitor over 10,000 investment funds, applying a multi-step process to choose the best of them: funds that perform well in the quantitative analysis process and also invest in equities and bonds issued by companies that excel in environmental and social aspects as well as corporate social responsibility. In terms of sustainability, companies that operate in the areas of arms manufacturing or in businesses related to gambling, pornography, tobacco or alcohol are largely excluded.

Who is the mandate suitable for?

The asset management mandate with sustainable fund selection is aimed at investors wishing to invest in companies and also help towards overcoming the challenges posed by environmental and social issues. 

Which investment instruments are used?

The asset is made up of collective investments. For each market, we analyse whether actively managed investment funds or index funds are better suited. When using index funds, we make sure that cost-effective or institutional tranches are available which meet all the qualitative requirements.

VZ only invests in funds that perform well in analyses. This results in a measurably improved performance. As it is independent, VZ is not bound by a limited investment universe and can always choose the best fund free of conflicts of interest.

What does sustainable investing mean?

Sustainable investments explicitly take into account ESG criteria. These criteria are concerned with the dimensions of environment, society and corporate governance.

E: Environmental

Companies whose activities promote climate change, exploit natural resources, attack the ozone layer or have a negative impact on biodiversity are avoided. Instead, investors prefer companies whose activities contribute towards the development of environmentally friendly technologies, products and services.

S: Social

Companies that are involved in controversies over human rights, breach employment rights or whose activities threaten people’s health or security are avoided. There is a preference for companies whose activities contribute towards improving people’s quality of life.

G: Governance

Companies that do not act in the interests of their shareholders or breach the principles of ethical business conduct are avoided. Investors instead prefer companies with exemplary corporate governance practices.

Principles for Responsible Investment

VZ has committed to the United Nation’s Principles for Responsible Investment (UN PRI): by following the six rules for responsible investment, we aim to help build a more sustainable global financial system.

Sustainable investing with VZ

What are the advantages of independent asset management?

It is not easy to maintain an overview of the wide range of sustainable funds on offer. At VZ, we continually monitor over 10,000 investment funds, applying a multi-step process to choose those that perform best in qualitative and quantitative analyses. As we are independent, we are not bound by a limited investment universe and can always choose the best fund for you free of conflicts of interest.

During the selection process, we rely on the data and ratings provided by MSCI ESG Research and Morningstar/Sustainalytics, the leading global providers of sustainability analysis.

How does the asset management mandate work?

The asset management mandate OPA-focussed invests in a similar way to an average Swiss pension fund – whether in equities, bonds or real estate. Adherence to the investment strategy has top priority and is ensured by an intelligent rebalancing process: If the defined bandwidths are violated, for example through strong overweighting or underweighting of individual asset classes, these are brought back to the strategic weightings through targeted transactions. This intelligent rebalancing process is based on fixed rules, meaning that human emotions do not negatively influence investment decisions. 

Who is the mandate suitable for?

People about to retire rely on their money being invested in a way that is profitable over the long term. For them, following the strategy of successful pension funds can be a good idea. For decades now, pension funds have been among the most successful investors. The pension fund index shows that since 2000, Swiss pension funds have generated an average annual return of around 3 percent – with an equity weighting of 30 percent on average. VZ has launched the asset management mandate OPA-focussed for investors wishing to benefit from this experience.

Which investment instruments are used?

The portfolio management mandate OPA-focussed is implemented with cost-effective ETFs and other index funds. VZ monitors all index funds traded on the Swiss stock exchange and applies a professional selection process to pick the best index funds for each asset class. In the core portfolio of the mandate, the markets are replicated using index funds which are based on the Pictet LPP Indices.

How does the asset management mandate work?

The asset management mandate with individual securities combines successful investment models, such as best manager selection process, dividend strategy and relative strength. The most suitable investment instruments are selected for each asset class.

Who is the mandate suitable for?

The asset management with individual stocks is suitable for investors who already have a certain level of wealth. By focussing on individual stocks, they aim to leverage addition return opportunities, while also having to assume additional risk, however.

Which investment instruments are used?

The most suitable investment instruments are selected for each asset class. Depending on this selection, investments are made in individual securities, actively investment managed funds or index funds.

• When using ETFs and other index funds, we make sure that cost-effective or institutional tranches are available which meet all the qualitative requirements.
• The asset class Equities Switzerland mainly consists of individual securities that are selected based on their dividend strength and their price potential.
• In the asset class Equities international we make use of factor index funds.

How does the asset management mandate work?

The asset management mandate top Swiss dividend equities selected around 25 of the top Swiss equities – in principle ten large caps, ten mid caps and five small caps. The equities are assessed on the basis of their dividend returns and are selected taking into account the stability of their dividends and potential. In doing so, we also take into account fundamental data and company-specific features. The companies should also be in a position to maintain their distributions at a high level or even to increase them. When structuring the asset, we are sure to make it as broadly diversified as possible. As an investor, you decide whether you wish to reinvest the dividends on an ongoing basis or have them paid out annually.

Who is the mandate suitable for?

The asset management mandate top Swiss dividend equities is suitable for investors looking for an additional investment opportunity. A pure equities asset is particularly suitable

• for experienced investors able to cope with major price fluctuations
• as an addition to a asset which is tailored to the risk capacity and risk tolerance of the investor
• for investors who do not need to access their money for at least ten years.

Which investment instruments are used?

The equities contained in the SMI, SMIM and SPI Extra indices are analysed based on their dividend returns. Further important criteria include the stability of the companies’ dividends and the potential for future distributions. We continually monitor the stocks we choose and take into account the fundamental data and company-specific features.