Index Solutions ETF versus Index Funds 

ETF versus Index Funds 

Credit Suisse Asset Management offers index funds rather than exchange-traded funds (ETFs) as we believe they offer clear advantages.

Index Solutions: ETF versus Index Funds

Alongside index funds, exchange-traded funds (ETFs) also pursue a passive investment approach. This means that the investor is exposed to the index’s fluctuations in value.

Compared to ETFs, however, index funds display three core strengths:

  • They physically replicate their reference indices. The investor receives almost the same performance that is replicated by the index. 
  • They are charged in a transparent manner. 
  • The subscription and redemption of shares are exempt from Swiss stamp duty.

Credit Suisse index funds versus exchange-traded funds – comparison

 

Credit Suisse index fund

ETF

Swiss stamp duty   

There is no Swiss stamp duty on subscriptions, redemptions, or transactions within the fund* 

0.15%/0.075% on the transaction volume for buying and selling, depending on issuer (Swiss/non-Swiss ISIN) of the ETF 

Liquidity

Daily subscription and redemption 

Intraday trading

Trade price

NAV +/– fixed subscription or redemption spread as compensation for transaction expenses within the fund 

Bid and ask price at the time of the trade, plus broker commission

Valuation

At NAV, according to index   

Last traded price

Minimum investment

No

No

Subscribable in various currencies

Yes

No   

US inheritance tax relevancy

No (Swiss ISIN)

Yes, for US ISIN (varies, depending on the provider)  

Replication of benchmark

Physical (physical delivery possible for CSIF II [CH] Gold)

Physical or synthetic, depending on the provider 

Securities lending

No securities lending in Blue CSIFs 

Most ETFs engage in securities lending transactions 

CHF-hedged benchmarks available

Yes

Varies, depending on the provider 

* CSIF (Lux): Swiss stamp duty of 0,15 % for subscriptions only.
Source: Credit Suisse, June 2017

Risks

  • No capital protection
  • The risks of owning stocks are the large unforeseen general market downturns
  • General prevailing local or global economic conditions and events can negatively affect equity valuations