Thursday, February 18, 2016

Taking on risk that could otherwise be diversified away

Since the United States is the world's largest national economy, it is understandable that US investors think that it is fine to hold all of their assets within US borders. The home country bias is understandable, but it isn't optimal. Owning an American-only portfolio can lead to suboptimal risk-adjusted returns, according to best practices in portfolio management which reduces the volatility of your investment portfolio by adding international diversification to your overall wealth strategy.
In the long term, a well-diversified, global portfolio can help avoid unnecessary risks.

Jurisdictional diversification is key

Holding some emerging market mutual funds at your local bank, even in other currencies, is not true international diversification. Going to another jurisdiction outside of the United States, to other non-American financial institutions, holding other foreign investments and other currencies is the real thing. Hiring a wealth manager with international experience and a global outlook and a different perspective than your local investment adviser will lead you to true international diversification.
Don't tie your future financial well-being to just one country, one market, one currency and one perspective.
US financial professionals for the most part, understandably focus on the American market, American financial institutions and US dollar investments.  However, to achieve greater resiliency for your overall portfolio through international diversification, a global-oriented wealth manager will target different investments than your domestic adviser. Holding a portion of your assets in a bank outside of the American banking system provides institutional risk diversification and greater flexibility. Currency diversification provides a hedge against a falling US dollar. The prudent investor shouldn't walk around blindfolded but should prepare for bumps which may arise along their home-markets roads.
It is simply prudent to have some assets outside of the American system.

Where to go? Grüezi!

Switzerland has adopted a white money strategy putting the old myths of secret numbered accounts and hiding funds from the tax man behind. Despite turbulences, Switzerland remains the global leader for private wealth management with a world share of 25%, of which 51% is from investors abroad.
 Switzerland: The global leader
The highest level of economic and political stability, high-quality services and extensive expertise and experience is Switzerland's claim to fame for long-term success as the leading center for private wealth management. Especially during times of increasing volatility, the world's wealthy turn to Switzerland as a safe haven for their assets.

The Swiss traditions of honesty, reliability, continuity and a high regard for privacy are qualities appreciated by investors around the world.
Switzerland: Perhaps the safest home to your assets

Get started and get it right

A Swiss wealth manager registered as an Investment Adviser with the Securities and Exchange Commission in the United States, is focused on providing US tax-compliant, unrestricted wealth management services to Americans domiciled in the United States. Giving advice, telephone calls, correspondence and personal meetings with clients or promotional activities for potential clients is allowed. Reporting requirements are also clear so you can get it right, right from the beginning.
American clients welcome!
You can establish a relationship with a Swiss SEC-registered wealth manager and develop an internationally-diversified portfolio held with a Swiss bank that welcomes American clients without leaving home. Your Swiss wealth manager will walk you through the steps. Nevertheless, a trip to Switzerland to meet your wealth manager and to discuss your needs and goals in person is highly recommended.

Swiss SEC-registered wealth managers range from larger, bank-associated firms to smaller and more personal independent wealth managers. Minimum amounts of investment range between USD 50,000 and USD 30mn with everything in between.

They are also happy to collabroate with American financial professionals in co-counseling their clients in developing an internationally-diversified portfolio to complement the American portfolio already in place.
There's not an easier way to find a suitable Swiss wealth manager.

Do your homework

Finding a suitable Swiss SEC-registered wealth manager is easy. The new Swiss platform Where Americans are Welcome at lists them all, in an easy-to-access manner, individually, alphabetically and regionally. You can browse through the listings, read up on their SEC registrations and ADV Part 2 brochures with information on company size, assets under management, minimum amounts of investment, strategies, fees and so forth. Some provide particularly client-friendly access.

You can easily do your homework in the comfort of your home and narrow down a few (perhaps with the help of your local adviser) that you would like to get in contact with for an initial consultation. They are not more than a phone call or click away. And don't forget to mention that you accessed them through the Where Americans are Welcome platform!

For further information or if you have any questions please contact:
Anne Liebgott, CEO at +41 79 767 07 58

Tuesday, February 16, 2016

Why would a Swiss wealth manager register with the SEC in the US

Switzerland is renowned as the private wealth management capital of  the world with approximately 26% of the world’s private wealth held in Switzerland and managed by Swiss-based banks, wealth managers and
investment advisers. In times of heightened volatility and turbulence, Switzerland continues to attract the wealth of prudent investors around the world, seeking the highest possible level of safety for their assets beyond their own borders.

Now why would a Swiss wealth manager register with the Securities and Exchange Commission in the United States? A Swiss wealth manager can serve up to 14 American clients domiciled in the US with an aggregate  amount of assets under management not exceeding USD 25 million without having to register with the US authorities. So why do over 40 Swiss wealth managers take the bother to register with the SEC and fulfill the demanding regulations to be compliant? Beyond the actual SEC  registration, the Swiss SEC RIA is required to provide an annually updated “ADV Part 2,” a brochure that describes their business in detail in a narrative format, e.g. business practices, fees, conflicts of  interest, and disciplinary information. (The ADV Part 2 needs to be given to each potential client before a relationship begins and it is worthwhile to read it cover-to-cover.)

That’s why!

With an SEC registration, a Swiss wealth manager can communicate freely with American clients in the US. Phone calls, emails and correspondence of any kind are possible, providing Americans with easy access to Swiss wealth management services. A Swiss wealth manager is able to visit American clients in the US to discuss investment strategies and the development of their portfolios. And a Swiss wealth manager is able to actively promote wealth management services to Americans, individually, at conferences or on road shows, for example. Swiss wealth managers dedicated to working with American clients believe in the potential of the US market and an American investor’s growing need for international and jurisidictional diversification.

Swiss custodian banks

More and more Swiss banks are ready to accept American clients (see a list of the custodian banks here) – in collaboration with a Swiss SEC-registered investment adviser  (Swiss SEC RIA) despite a higher level of regulation. Based on a white money strategy and with FATCA in place, Swiss banks can act as a  custodian bank for American clients that work together with a Swiss SEC RIA. The set-up is compliant with SEC regulations and with the IRS…there will be no surprises along the way. A Swiss SEC RIA will assist you in the account opening process which you can do from the comfort of your home, you do not need to travel to Switzerland to do so (even if it is highly recommended that you visit Switzerland to see everything first hand).

A different perspective than your local adviser

With an international upbringing, education and professional wealth management experience, a Swiss wealth manager will have a different perspective than your local adviser. Swiss wealth managers are happy to  collaborate with your present local adviser to create an additional international portfolio that meets your needs and plans for the future.

An investment portfolio to complement the one you have at home

Your new international portfolio should complement the one you have at home. There is no need to duplicate investments. American investment portfolios are often one-sided with only American companies, American
financial institutions and the US dollar. Adding the component of international, jurisdictional diversification to your overall wealth planning is a prudent step to take…there’s no need to keep all of your eggs in the same basket.

Easy access

To get started, you need easy access to the Swiss SEC RIAs that are happy to work together with you and your local adviser. How do you choose the one that suits you best? Do you prefer a larger bank-associated wealth manager or a more personal independent investment adviser? Would you like one from the Geneva area, or do you prefer one from Zurich or even from Lugano? In any case, you will want to do your homework and check them out before you get in contact and establish a relationship.

You can easily do so using the new Swiss platform WHERE AMERICANS ARE WELCOME (WAAW) at  which lists the over 40 Swiss SEC RIAs that welcome American private clients. They are listed individually, alphabetically and regionally. Some of the more entrepreneurial Swiss SEC RIAs provide direct access to their ADV Part 2 and other information, e.g. events they are participating in, in the US and publications they issue.

TheWAAW Cheat Sheet

will show you how easy it is to establish your Swiss bank account with
Swiss wealth management expertise. Any questions on how to get started?
The Q&A section will answer them!

Other wealth management-related services such as estate planning lawyers, Swiss trustees and US tax advisers can be found on WAAW too. Considering a second passport and a foreign residence? You can find out more on WAAW.

There is no sign-up procedure to access WAAW, no need to complete forms to make inquiries, you simply click right through to the experts of your choice. There is not an easier way to find out more and get started in Switzerland!

Anne Liebgott, CEO