Fund switch

This tool visualizes the tax implications of switching funds.

To exit a fund you tipically have to realize gains and pay capital gain taxes. This operation effectively reduces the total amount of money available, slowing down the compound interest.

Configuration

A capital of means that if you invested € you'd now be standing on €, with an unrealized of €.

The taxable gains are of the initial investment. Hence, to realize the of € on an initial investment of € you'll have to pay € of capital gain tax.

Current and desired funds

Use the following fields to configure the parameters of the current and desired funds.

Subtract ongoing charges to the the annual return.

For example, suppose one of the funds is VWCE.

Its benchmark, FTSE All-World, had a compound annual growth rate of 8.66%. Meanwhile the ongoing charges of the fund are 0.24%:

Management fees: 22‰
Transaction fees: 2‰

Hence, you should input 8.42%.

Current fund

Desired fund

Future capital without switching

Suppose you originally invested money.

If you remain in the current fund, after days the gross and net (before exit fees) capitals would be:

Future capital if switching

Due to capital gain taxes and exit fees, upon realizing the current fund , your liquidity will be of the gross.

To then invest in the desired fund you'll have to pay in purchase fees, meaning that you'll be entering the fund with of the current gross capital; i.e.

Though you might be entering the desired fund with less capital, you'll later pay fewer capital gain taxes.

Hence, after days the gross and net (before exit fees) capitals in the desired fund would be: