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What is True Wealth's investment approach?

We pursue a scientifically based, passive (i.e. index-oriented) investment approach and implement this consistently for our clients. We deliberately avoid expensive, actively managed investment products that claim to beat the market. Numerous scientific studies have come to the conclusion that low-cost and liquid investment funds achieve better returns on average and after costs than expensive ones.

This is why we rely primarily on ETFs, i.e. exchange-traded investment funds that track a market index. However, there are over ten thousand ETFs on the market and not all of them are suitable. We select the best ones for you. In addition to the product costs, we also take into account the market liquidity and the counterparty risk resulting from the structure of the ETF.

In addition, we analyse how well the ETF tracks the market index (so-called tracking error) and take into account the tax efficiency of the investment instruments in order to minimize withholding tax on dividends. We also pay attention to the trading currency of the ETF in order to avoid unnecessary currency conversions from CHF to foreign currencies, where this is beneficial to the bottom line. In Pillar 3a, we also use index funds for tax reasons.

Find out more about our investment approach in the video podcast with CEO Felix Niederer.

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