Asset Management Cost Comparison

Asset management customers are particularly sought after because wealthy customers in particular can be very profitable for banks. One reason for that is that fees for asset management are still high.

For its 2024 analysis, moneyland.ch examined the fees charged for asset management and investment advisory services for three different investment strategies.

The results show that Swiss asset management services are generally expensive, but there are big differences between service providers. “Depending on the investment strategy used, the most expensive mandates can cost more than three times more than the cheapest ones,” observes Benjamin Manz, managing director at moneyland.ch. Comparing asset management fees pays off. Useful note: Depending on your wealth and the bank in question, you may be able to negotiate asset management fees for better conditions.  

The average asset management fee is 1.32 percent

Using a conventional asset management service to invest 250,000 in a pure stock portfolio costs 3289 francs in asset management fees, on average, across the Swiss banks included in the study. That means the fees you pay every year are equivalent to 1.32 percent of the amount invested. That does not account for additional expenses like currency exchange costs, taxes, stock exchange fee, and fees charge by funds used. The fees charged by funds, in particular, can often cost you around as much as the fees charged for the asset management service.

Robo advisors - asset management services that are only available through digital channels – are substantially cheaper. The average asset management fee is less than half of the average fee for conventional asset management, as various moneyland.ch comparisons have shown. Hybrid models that combine digital apps with personal consultation are also on the rise.

Costs vary between investment strategies

The pricing of many Swiss banks still follows the rule that the bigger the stock component of your investment portfolio is, the higher the asset management fee will be. For example, investing one million francs in a pure stock portfolio (80 to 100 percent stocks) using Swiss asset management services will cost you 12,574 francs per year, on average. That is equal to around 1.26 percent of the invested capital. For a portfolio with a stock component of between 40 and 60 percent, the cost is still 1.16 percent. For a portfolio that does not include any stocks at all, the average asset management fee if 0.92 percent.

The cheapest asset management service

There are big differences in the flat asset management fees charged (see tables 1, 2, and 3) across the offers included in the moneyland.ch study. Of the analyzed service providers, the cheapest are the Sparkasse Schwyz, Alpian, and the Basellandschaftliche Kantonalbank. Other banks are cheapest for certain investment strategies and wealth categories.

Example: Customers who invest 500,000 francs in a pure stock portfolio pay 3500 francs per year at Sparkasse Schwyz (ETF Mandate), 3750 francs at Alpian, 5000 francs at the Basellandschaftlichen Kantonalbank, and 5400 francs at Swiss private bank Piguet Galland.

The cheapest investment advisory service

In addition to asset management, Swiss banks also offer investment advisory services. With an investment advisory service, the customer can choose between various investment recommendations, but has the final say in whether or not to invest. With asset management, on the other hand, the customer only chooses their desired investment portfolio.

For 500,000 francs of assets and a pure stock portfolio, Sparkasse Schwyz has the cheapest investment advisory at 1500 francs per year. Next in line is the Uno offer from the Basellandschaftlichen Kantonalbank, with 1750 francs of investment advisory fees. Most banks normally pass on the fees charged by funds used to the customer on top of the financial advisory fees.

Table 1: Flat fees for a portfolio worth 250,000 francs

Table 2: Flat fees for a portfolio worth 500,000 francs

Table 3: Flat fees for a portfolio worth 1 million francs

Table 4: Investment advisory fees for a portfolio worth 500,000 francs