Comparing ETF Investment Costs

Dear sir/madame,

I would like to invest around 20,000 Swiss francs in the iShares Core MSCI World ETF with the ISIN number IE00B4L5Y983.

I would like to make this investment in tranches of 1000 francs per month. I do not want to invest in an other shares or securities. I only want to invest in that ETF.

Could you please tell me which fields I should fill out in your online trading comparison in order to find the best broker for this investment?

Should I fill out the fields: "Number of transactions of Swiss ETFs (per year)" and "Value per transaction Swiss ETF (CHF)"? Or should I fill out the fields "Number of transactions of US equities (per year)" and "Value per transaction US equities (USD)"?

My "Country of residence" is Switzerland and I selected the "Not specified" option in the "Current provider" field.

I look forward to receiving your reply.

Kind regards

Hi there,

The ETFs which you mentioned are also listed on the SIX Swiss Exchange:

https://www.six-swiss-exchange.com/funds/security_info_de.html?id=IE00B4L5Y983USD4

When using the moneyland.ch online trading comparison to compare costs, simply select the "Individual profile" options and fill out the relevant fields like this:

Total amount of Swiss ETFs (CHF) = 20000
Number of transactions of Swiss ETFs (per year) = 20
Value per transaction Swiss ETF (CHF) = 1000

Important: The cost of making multiple, smaller investments in ETF shares (20 x CHF 1000) is significantly higher than the cost of investing the full amount in a single, large share purchase (1 x CHF 20,000). The reason for this is that brokerage fees apply on a per-transaction basis. Many brokers charge flat fees rather than fees based on the size of the amount transacted, or they charge a minimum base fee and then an additional fee based on a percentage of the transacted amount. In some cases you may save money by saving up and then making a single investment. You can find more information in the moneyland.ch guide to investing in ETFs.

ETFs listed on U.S. exchanges: Currently, the online trading comparison only lets you compare brokerage fees for ETFs which are listed on Swiss exchanges (including the flat fees from Swissquote and Strateo which only apply to trades on Swiss exchanges).

However, many brokers use the same brokerage fees for ETF share transactions that they use for transactions of shares in stocks. If you want to buy shares in an ETF which is listed on a U.S. exchange, you can enter the relevant amounts in these fields:

Total amount of US equities (USD) = 20000
Number of transactions of US equities (per year) = 20
Value per transaction US equities (USD) = 1000

The comparison results will give you a good idea of which broker is the most affordable for an investment in ETFs listed on U.S. exchanges.

Best regards from Moneyguru

More on this topic:
Guide to investing in ETFs
Online trading broker comparison

I would like to buy an ETF based on Swiss stocks, like, for example, the UBS ETF (CH) SMIM (CHF) A-dis. With a 0.28% TER, the price is good. But now I've noticed that in addition to the recurring fees, I pay an insane 5% entry fee. This seems to be the case with other ETFs on Swiss stocks, and starting out with a 5% minus makes investing very unattractive to cost-sensitive investors.

Is there any way to get around these fees. Any alternative products for tracking Swiss stocks? And, why in the world do these Swiss stock ETFs have that crazy fee? None of the other ETFs I know of have it.

Just to avoid misunderstandings, I am not talking about brokerage fees or other third-party fees.
 

The front-end load shown in the documentation is normally the maximum fee which may be charged (up to 5%, for example). In practice, the front-end load you pay will normally be much lower.

The best thing you can do is ask the broker through which you will buy the ETF shares. They should be able to clarify the actual costs for your situation.

Here's a good example. The documentation of the Pictet CH Solutions - Swiss High Dividend / CH0140970119 states that a front-end load of up to 5% may apply.

But PostFinance charges just 1%, maximum 20 francs, for this fund.

PostFinance states that you are charged a fee equal to 1% of the first 1000 francs of the purchase price when you buy the shares. There is no minimum front-end load other than the 20-franc minimum fee. There is no back-end load.