With the VIAC Account Plus, 95% of pension assets are held in the account at a preferential interest rate of 0.1% per annum. The remaining 5% are invested globally and broadly diversified in equities. There are no custody fees, brokerage fees, administration fees or product costs. With the investment focus Global or Switzerland, product costs are also included. External product costs of approx. 0.01% are only incurred for Sustainable implementation.
VIAC's investment strategies cover six different risk types. In addition to the interest-bearing account (no fluctuations), we offer various strategies with a small equity component (strategy 20), which are exposed to smaller fluctuations, up to pure equity strategies (strategy 100), which are exposed to larger fluctuations. The questionnaire helps you to find the right strategy for you. Of course, you can adjust the strategy at any time.
No. With an investment you are always exposed to the market movements of the stock exchange. If you do not want any fluctuations, you can also open an interest-bearing 3a account with us.
If you don't want to have any fluctuations in the meantime, you can change your strategy at any time and without additional costs and invest again at a later date. However, we generally recommend a "buy and hold" strategy. Our system will then perform the regular monitoring for you.
Yes, each of our strategies also invests abroad. The discussion about foreign currency risks is often very superficial and non-transparent. For example, Nestlé, a Swiss share, generates only about 1% of its sales in Swiss francs. In the risk assessment, however, this share is allocated 100% to the Swiss franc. On the other hand, Apple also generates sales in CHF, but is allocated entirely to the USD.
From our point of view, it is important to create the awareness that foreign currencies are indispensable for an investment. These offer both opportunities and risks. It is also not enough to "hedge" the foreign currencies. What is often ignored is that you pay the interest rate difference between the two currencies for a hedge. Historically, in case of Swiss investors the costs of hedging have exceeded the benefits.
In selecting our funds, we have made sure that physically replicating funds are used. Physical replication means that the underlying shares of the index are effectively bought by the index fund or ETF provider. Investment in synthetically replicating products is avoided if possible, as they are exposed to counterparty risk.
Traditional investment funds are often "actively" implemented and try to beat the underlying index (e.g. SMI). However, the active management of assets causes additional expenditure, which is reflected in higher costs. Our strategies, on the other hand, are passively implemented with index funds and ETFs. These reflect the underlying index directly and are correspondingly inexpensive. Our strategies also resemble a modular concept, as several index investments are used for each strategy (per asset class and region). Accordingly, our strategies are only available from VIAC and are not publicly available.
No. We are convinced that good diversification, which we offer through our broad-based strategies, is the best way to invest in the long term. An important driver for the performance are the costs, which we want to keep as low as possible for our customers. We can only achieve this through a certain degree of standardization.
No, the fund offering is determined by VIAC and optimized in the best possible way according to costs, tradability and performance. We monitor market developments on an ongoing basis and try to select the best index funds for our clients at all times.
Yes, you can also receive dividends from index funds and ETFs. Some of the index funds and ETFs distribute dividends. In these cases the received money will be credited to your account and reinvested in the next rebalancing if there is a sufficient deviation from your target strategy.
In the current low interest rate environment, we are not using 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 (administration fee and product costs) may exceed the yield and bonds thus have a negative return. If interest rates rise again one day, bonds will also suffer valuation losses. For these reasons, we currently believe that the positive interest-bearing account is the better solution for our customers.
Yes, in the section VIAC Strategies you will find a factsheet with historical performance and other interesting information on each investment strategy.
In terms of sustainable implementation, we distinguish between the global and the Swiss equity part.
The global equity part of our sustainable strategies is implemented with sustainable ETFs and index funds based on the MSCI Socially Responsible and the MSCI ESG Leaders Indices. Sustainability is taken into account in various ways:
- First, certain industries are completely excluded. These include alcohol, gambling, tobacco, eroticism, nuclear power, military weapons, civil firearms and genetically modified organisms.
- All remaining industries are then analyzed and evaluated in the second step in the environmental, social and corporate governance (ESG for environment, social and governance) areas. The resulting ESG rating ranges from CCC to AAA. A "good" or at least an A must be achieved in order to be included in the index.
- Third, it is also examined whether a company has been subject of controversy (e.g. human rights violations or causing serious environmental damage). Companies with a score of four or higher (on a ten-point scale) are also excluded.
Finally, the best-in-class approach means that in each industry, companies with the best ESG rating are considered first and included in the Index. This happens until 25% (50% in the case of the MSCI ESG Leaders indices) of the market capitalization of the respective industry is reached.
The Swiss equity component is deliberately implemented in a classic (non-sustainable) way. This is for the following reasons: In principle, the Swiss market is already more sustainable per se than most other markets. This is because industries such as tobacco, alcohol, weapons etc. are not represented at all. What is then usually done with sustainable Swiss funds is that they are additionally filtered according to ESG ratings. For example, Novartis is then excluded (governance issue), whereas Nestlé or Roche are not. Additionally the Swiss market as measured by the SPI is dominated by these three heavyweights. Other international stock indices often have a much broader natural diversification. Excluding one of these heavyweights results in a very large deviation from the index and thus a different risk profile. This problem is often solved in sustainable funds in such a way that the heavyweights are not (or only partially) excluded, but only reduced in weighting. In our view, however, this only embellishes the problem, but does not solve it.
Consequently, we deliberately refrain from "greenwashing" the Swiss equity part. The Swiss equity market meets the exclusion criteria of many sustainable investment approaches without additional filtering and is therefore already "more sustainable" per se.
It is also important that our investment focus on "Global", "Switzerland" and "Global Sustainable" - as the name suggests - is a focused implementation of the theme. International equities also account for around 25% of the Switzerland 100 strategy. In our opinion, the fact that a "label" is used to try to make the Swiss equity component look sustainable is not a goal-oriented approach. With the classic approach to Swiss equities, we are not trying to solve this problem half-heartedly, but are optimizing the foreign equity component where added value can really be generated and are consciously committed to the chosen implementation.
PS: By the way, all of our chosen strategies already have a lasting impact. On the one hand, this is due to the fact that we avoid the senseless sending of millions of pages of paper and, on the other hand, we have a tree planted for each VIAC client. These are already over 30'000 trees with which we help to slow down climate change and achieve a real impact: day by day.
The client can choose between "Global", "Switzerland" and "Global Sustainable". We recommend focusing on "global" in order to keep investment costs as low as possible and spread investment risks as widely as possible. Strategies with investment focus "Switzerland" invest at least 75% in Switzerland across all asset classes. The "Global Sustainable" focus does not invest in gold, companies in the alcohol, gambling, tobacco, eroticism, nuclear power and weapons sectors. In addition, all equity investments outside Switzerland are made in accordance with the strict ESG sustainability criteria. For these sustainable strategies, the sustainable ETFs used cause an average additional cost of about 0.10%.
The Terzo Pension Foundation has applied the following selection criteria for the selection of index funds and ETFs:
- Low fees for the client
- Good liquidity for trading
- Low Tracking Error
- Trading spread
- Physical replication
- Minimization of possible tax influences (e.g. stamp taxes)
Your pension assets are invested globally and diversified. In the standard strategies you participate in the development of more than 2’800 companies worldwide. This clearly minimizes the individual security risk. In addition to the Swiss franc, you are also invested in other currencies, with the US dollar accounting for the largest share of foreign currencies.
Index funds and ETFs are characterized by the following features, among others:
- Low fees
- Passive implementation - usually follow an index (you know what you have)
- Efficient diversification; index funds and ETFs in some cases cover several hundred individual stocks
All VIAC strategies are implemented with index funds and ETFs. The main distinguishing feature is trade. In the case of index funds, subscriptions or redemptions take place once a day (primary market and thus exempt from stamp duty), while ETFs (exchange traded funds) are traded directly on the stock exchange (secondary market). Both index funds and ETFs usually follow an index (e.g. SMI for Swiss equities) and try to replicate its performance as accurately as possible. Since they merely follow the index and do not try to actively beat it, they are also called passive investment products. These passive investment funds are particularly suitable for investors who wish to invest in a broadly diversified market with a single transaction at low cost and in the long term.
By answering 6 simple questions you will find the right strategy for you. Your willingness to take risks has a major influence. If you don't like big fluctuations, you will only be offered low-risk strategies. In addition to risk appetite, risk capacity also plays a major role. This is essentially determined by the investment horizon, which is typically very long in the third pillar. For example, a 30-year-old investor can easily sit out a stock market crisis. This is the case since his investment horizon (period of time in which the money is invested) is around 35 years (that is, until retirement).
Your money is invested globally and diversified. By using index funds and ETFs, you can participate in the development of more than 2’800 companies worldwide (standard strategies). The most important asset classes are equities, real estate and gold, whereby the equity component is tailored to your risk profile. In the current low interest rate environment, bonds are not used for cost and risk reasons (since after fees a negative return would result) - instead of which the positive interest-bearing account is used.
The Terzo Pension Foundation of WIR Bank is responsible for ensuring that index investments (index funds and ETFs) are selected and used for the benefit of the client. No active asset management is carried out within the strategies.