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