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Investment Options for Parked Money In Swiss Broker

rowena

Active Member
Hello,
I parked some of my money to Swiss broker but I reached the threshold and they will apply negative interest rates for money. I need to invest a product to avoid negative rates. I am not looking for something risky. I don't need to use this money in the near feature. I just want to avoid inflation. Can you recommend me an investment option? Amount is 6 digit and currency is euro.
 

GiGoGo

I make things happen
Silver Member
Germany Bund 30 Year Yield +0.24%
Also some US Treasures have higher yield
 

Martin Everson

Offshore Retiree
Mentor Group Gold
Elite Member
I need to invest a product to avoid negative rates
There is not much risk free cash instruments that is yielding for Euro's.

I just want to avoid inflation.
Inflation?...lol.

Eurozone inflation rate is close to zero that's why euro rate is negative. The eurozone aint doing good at all...lol.

Can you recommend me an investment option?
Physical cash.

Still would love to hear what others would do. Can't wait for the buy stable coin or gold responses to appear smi(&%
 

void

Entrepreneur
Still would love to hear what others would do. Can't wait for the buy stable coin or gold responses smi(&%
Just to please Martin.... :)

Under current circumstances BTC is pretty conservative investment with huge potential.

And more serious... how about buying a share in some well established company - a trusted current owner can cashout some money, reduce risk (if any) and you can earn a few percent...
 

iloveyouguys

BANNED MEMBER
Why don't you invest in the US? It's the best market if you're not at the bottom

Vanguard index funds.
For the ten years ended December 31, 2018, the 500 Index Fund posted an average annual return of about 13%.
In a crisis you can lose 30% but it is bound to go back up unless US economy collapses permanently.

 

rowena

Active Member
Germany Bund 30 Year Yield +0.24%
Also some US Treasures have higher yield
I noted this thanks.

Inflation?...lol.

Eurozone inflation rate is close to zero that's why euro rate is negative. The eurozone aint doing good at all...lol.

Physical cash.

Still would love to hear what others would do. Can't wait for the buy stable coin or gold responses to appear smi(&%
I know that inflation is very low but as you said it is not zero.

Physical cash is not an option, it is hard to manage and I don't have any tax-related concerns.

I already have crypto investments. I bought them 3 years ago so far I made a %400 profit but this is not something low risk or medium risk. It is a very high-risk investment. Gold... maybe.


Why don't you invest in the US? It's the best market if you're not at the bottom

Vanguard index funds.
For the ten years ended December 31, 2018, the 500 Index Fund posted an average annual return of about 13%.
In a crisis you can lose 30% but it is bound to go back up unless US economy collapses permanently.
I checked my with my broker and it looks like I can able to buy Vanguard EUR funds. I will check low-risk Vanguard based options. I noted this option thanks.
 

BlueMist

Entrepreneur
Does this sound like a non-risky way to invest 6 digits? i.e potential 30% loss followed by hope ns2
I think it depends on what "near future" means for the OP?

Also why not to check SQ managed portfolios? They have different portfolios depending on your level of risk.
 

rowena

Active Member
I think it depends on what "near future" means for the OP?

Also why not to check SQ managed portfolios? They have different portfolios depending on your level of risk.
I mean 5-10 years.

The broker is not SQ but personally I don't believe broker based managed portfolios or similar products. Generally, they're ripping off(except proper investment firms like Vanguard, Schwab, Blackrock).
 

BlueMist

Entrepreneur
I mean 5-10 years.

The broker is not SQ but personally I don't believe broker based managed portfolios or similar products. Generally, they're ripping off(except proper investment firms like Vanguard, Schwab, Blackrock).
Then why not ETF? I have portfolio of ETFs with 10-20 years investment in mind.
Google Mark Zoril, he provides financial advise for $96 per year. He will help you to build ETF portfolio based on your age and investment period. He has many customers from UAE, he helped me to build my ETF portfolio in EUR currency. You can email him, schedule a chat video appointment, he also releases interesting podcasts about his investments views and concerns.

I think the important thing here is not to hear or read too many things from different sources, just stick to the plan and contribute to the portfolio e.g. monthly, quarterly or annually. Most people are contributing monthly but they are usually using cheap broker like IBKR, I don't want to do this every month and I don't want to pay too high charges either, so I prefer to contribute lumps sums annually. The general rule is that the total investment fees should not exceed 1%.
 

JohnSeed

Corporate Services
BANNED MEMBER
Then why not ETF? I have portfolio of ETFs with 10-20 years investment in mind.
ETF will always relay on the manager or the firm that is handling the ETF so the fees are most often high because of greed.

Invest in Gold or Art that may keep the money in your pockets rather than brokers.
 

Martin Everson

Offshore Retiree
Mentor Group Gold
Elite Member
Physical cash is not an option, it is hard to manage and I don't have any tax-related concerns.
What has tax got to with this....lol? Its about avoiding negative rates.

Why do you not simply spread your euros around various banks to stay under the negative rate thresholds? :rolleyes:

Gold... maybe.
lol...do you know the volatility of gold on a 5-10 year basis? It is as stable as Donald Trump.

Whatever you decide anyway totally avoid equites as they are one of the highest risk assets and lowest in the capital structure of companies when it comes to security.
 

BlueMist

Entrepreneur
ETF will always relay on the manager or the firm that is handling the ETF so the fees are most often high because of greed.

Invest in Gold or Art that may keep the money in your pockets rather than brokers.
The most prominent ETFs have TER (Total Expense Ratio) of 0.2% and there are many good ETFs with even lower TER 0.1%. Frankly, that's not expensive. The rest fees are the broker fees and these varies greatly. Some have annual custody fees but lower trading fees, some doesn't charge custody fees (e.g. Standard Chartered Singapore), others have fixed fees liked Internaxx anywhere between €100-180 yearly (they charge €25-45 per quarter depending if you traded something or not). Depending on the amount invested, these are not high fees generally speaking.

Expensive can be managed portfolios, e.g.:
Lux Portfolio , all of them have been performing very well, however the entry charges are 2.5% and exit charges 1%, while annual charges of 1% are taken from the fund. Considering the performance, probably it's still worth it if you can't get it done yourself.

I have no experience with Art, I believe that most art we see these days are fake anyway, the originals have long time been stolen and traded for massive amounts of money (greed, human nature of getting reach or possessing something others can't).

As for Gold I am not sure if I would trust these remote storage facilities where you buy online and they store it for you. But buying physical Gold e.g. in Singapore and storing it myself at one of the dedicated facilities e.g. Certis (Singapore), that could be an option of holding part of the assets. However you pay for the storage and you need to physically go there, so invest time and money. I believe however that gold is a good option if someone is extremely reach and can afford buying 20kg of gold which would be equal to 1% of his assets, just to diversify investment portfolio but not as a main investment.
 
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rowena

Active Member
@BlueMist
I like ETFs because easy to buy, sell and manage but the thing is I am actually looking ETF recommendations smi(&%

@moneynetwork
Of course, there are some expensive ETFs but generally, ETF fees are low(compared with broker or bank managed portfolios). I will include a little(%20) gold ETF to my portfolio but I not familiar with art investment.

@Martin Everson
Some people storing physical cash to avoid CRS etc but It is hard to manage or security is another big problem. I will increase my Euro assets this year and that's why I cannot constantly open bank accounts to stay under negative rate limit. I am planning to open another 2-3 more bank accounts which are under 1 million euro.

If you have any Euro fund or ETF recommendation which is stable and low risk, it will be useful.
 

OTR365

Active Member
It is as stable as Donald Trump.
Trump has told the World he is a "stable genius". Therefore, if gold is as stable as Trump, it must be "a pretty yuge investment, a tremendous investment to win bigly" ns2

I need to invest a product to avoid negative rates. I am not looking for something risky. ... I just want to avoid inflation.
You can't have everything. There is no getting return without taking risk. Decide what is most important to you, and act accordingly.

You could exchange your excess cash to USD to avoid negative balances. For example, Swissquote charges negative rates for CHF & EUR, but not USD. So, keep 500K (or whatever your broker's limit is) in EUR, and the rest in USD.
 
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BlueMist

Entrepreneur
@BlueMist
I like ETFs because easy to buy, sell and manage but the thing is I am actually looking ETF recommendations smi(&%
[...]
Don't invest in Gold ETF, I can't remember where but I read a good article about why it is a terrible choice.
Also you can read a book by Andrew Hallam, his is a big advocate of low cost funds, in fact he writes here why Gold is a bad investment in general. Even reading his website and past blogs will help you to understand ETFs better.

I already recommended you financial advisor, who will help you getting invested and understand the risks.
You can also read Bogleheads forum to get better idea with your selection, also their WIKI page list the best ETFs for EU investor. My portfolio consist of 3 ETFs (different % split) and I intend to stick to them regardless of what happens.

Unlike many, I still believe that keeping bigger portion of assets in cash is the best thing, as cash is the king in emergencies.
 

rowena

Active Member
@OTR365
Converting EUR to USD to avoid a negative interest rate, really?



@BlueMist
I will definitely check your recommendations thanks. My portfolio is like roughly %60 USD cash(fixed deposits), %20 real estate, %10 USA stock market and %10 bitcoin. So far they went very well but I want to diversify my portfolio with EUR based investments.
 

OTR365

Active Member
Converting EUR to USD to avoid a negative interest rate, really?
Yes, in case your bank does not charge negative rates on USD balances.

Your chart shows U.S. and Eurozone core inflation. What does it have to do with avoiding your bank's negative rates on EUR balances? Core inflation ≠ Bank's negative rate on balances.
 

rowena

Active Member
@OTR365
If you convert your currency to higher inflation currency then it is the same thing with having a negative rate. SQ does not pay interest to USD balances unlike IBKR or other brokers.
 

OTR365

Active Member
If you convert your currency to higher inflation currency then it is the same thing with having a negative rate.
I get your logic, but it relies on theory only. In practice we don't know if USD will strengthen or weaken against EUR. It would be better of course to have an USD account that pays interest.
 
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