In the current low interest rate environment, we do not use bonds for cost and risk reasons. Bond yields are closely linked to interest rates. In the case of low (or even negative) interest rates, it is therefore possible that costs incurred (provider’s fee and product costs) exceed the yield and thus result in a net negative return on bonds. Should interest rates rise again one day, bonds will also suffer valuation losses. For these reasons, we currently believe that the positive interest rate account is the better solution for our customers.
Your retirement savings account currently bears interest at 0.1%. This interest rate is slightly lower than the classic 3a account of WIR Bank, the “Terzo Account”. The reason for this is that we do not want to invest our clients in bonds in the current low interest rate environment. With the slightly lower interest rate, WIR Bank was able to find a good solution that benefits everyone. Our clients have a positive return, save on the cash portion of fees (which would be incurred on a bond investment) and avoid interest rate risks. WIR Bank, for its part, can attract these funds somewhat more favourably and thus also benefits. Last but not least, we are also happy that we can offer our customers a guaranteed positive return. A classic win-win situation!
PS: If someone wants to optimize additionally, he can only make the part of his deposit that he wants to invest in shares and then choose the Global / Switzerland / Global Sustainable 100 strategy. The portion he wishes to hold in cash can be invested in the bank of his choice, e.g. in the classic Terzo account. Unfortunately, however, this involves a little extra work and the pure equity exposure naturally fluctuates much more – this would always have to be considered in a consolidated way.