The Gerd Kommer investment strategy helps you to manage your money according to Dr. Gerd Kommer to invest. When you register, we will first ask you a few questions, on the basis of which we will suggest a “Level 1 asset allocation” that suits your needs, i.e. a division between “risky” and “low-risk” parts of the portfolio. This division has a strong influence on the expected future return and risk of the overall portfolio. The products in the two parts of the portfolio are selected, regularly checked and replaced if necessary.
The Gerd Kommer Robo Advisor strategy is offered via the Scalable Capital platform. Custody management and processing are carried out by Scalable Capital Bank. Once you have decided on a Level 1 asset allocation, a portfolio will be opened as part of onboarding and the desired investment amount will be withdrawn from your reference account. After the money is received, the portfolio is invested according to the selected allocation and continuously managed as part of the strategy.
The “Gerd Kommer” investment strategy can be selected within Scalable Capital’s asset management. Access is only possible via the Scalable Capital app or the corresponding web platform.
Financial portfolio management and custody account management are carried out by Scalable Capital Bank GmbH in compliance with all regulatory requirements.
Gerd Kommer Invest GmbH continues to advise Scalable Capital on questions of the investment approach as well as on strategic and operational issues in connection with the “Gerd Kommer” investment strategy. She is also responsible for marketing and communications measures.
There is no corporate connection between Scalable Capital Bank GmbH and Gerd Kommer Invest GmbH. There are no mutual investments.
The service fee for the “Gerd Kommer” investment strategy is 0.70% p. a. (including VAT). The income is divided between the partners involved according to the contractual agreement.
We are not subject to any conflicts of interest because we – such as: B. tax advisors, lawyers or craftsmen – are paid exclusively by you. This means that we do not receive any commissions, commissions or “kickbacks” from third parties. We do not use any “in-house” products. Our compensation does not vary depending on whether you invest conservatively or more ambitiously.
We follow a purely scientific investment approach, i.e. h. we invest exclusively on the basis of scientific findings. We do not use or make any forecasts. We do not speculate with customer funds.
We minimize product costs by using low-cost index funds (ETFs). Product costs, our service fee and the trading costs not shown separately are together far below the total costs of conventional asset management at banks and many independent asset managers.
No other Robo Advisor strategy invests according to Dr. Gerd Kommer. You can find a detailed description of our investment approach in our White paper.
Dr. Gerd Kommer has his investment approach in several ways books has been published and made transparent for over 20 years. To date, these books have had a total circulation of over 150,000 copies. The book Souverän Investing with Index Funds and ETFs has been on the bestseller list for business books most of the time since 2015 manager magazine.
The “Gerd Kommer” Robo Advisor strategy is a digital asset management within the Scalable Capital platform. It is aimed at investors with tax residency in Germany who want a fully managed solution.
After answering a structured questionnaire about financial goals, risk appetite, knowledge and experience, an individually suitable ETF portfolio is put together. This usually consists of several ETFs and reflects different risk profiles in a differentiated manner. Financial portfolio management – including ongoing monitoring, product selection and systematic rebalancing – is carried out by Scalable Capital Bank GmbH. Adjustments such as deposits and withdrawals or changes to the risk class can be easily made via the Scalable app or web access.
The Gerd Kommer ETF, on the other hand, is a single, globally diversified stock ETF for do-it-yourself investors. It contains no bond component and therefore corresponds to a 100% equity allocation. Investors who want a more defensive allocation must independently add a lower-risk component (e.g. a bond ETF).
The asset management of the “Gerd Kommer” investment strategy is carried out by Scalable Capital, a regulated securities institute. Scalable Capital is legally obliged to analyze your personal financial situation and other relevant circumstances to ensure the suitability of the investment strategy.
At the beginning of the registration process, you answer a structured questionnaire. Your information about financial goals, current financial situation, capital market knowledge and experience as well as your risk appetite form the basis for the subsequent suitability test and the investment proposal.
A central part of this process is assessing your risk-bearing capacity. Both your financial ability to take on risks and your knowledge and experience with capital market investments are taken into account. On this basis, the “Gerd Kommer” investment strategy that is suitable for you is recommended and implemented within Scalable Capital’s asset management.
We advise our customers to have an immediately available emergency reserve for unforeseen events (e.g. in a separate bank account) that should cover your normal ongoing expenses and obligations for six to twelve months.
The remaining part of your liquid assets should be invested long-term, cost-effectively and broadly diversified.
We do not consider capital-forming life insurance to be a sensible investment product and generally advise against it. Gerd Kommer has a blog post about this with the title “Capital-forming life insurance – a German wrong turn" written.
Yes, the minimum investment amount for an investment is 20 euros per portfolio. If the invested volume falls below the limit of 20 euros at any time due to market movements, you do not have to add any additional money.
Partial withdrawals that cause the investment amount to fall below 20 euros are not possible. Within this framework, only a full payment of your investment amount and an associated contract termination is possible.
The “Gerd Kommer” investment strategy is currently aimed exclusively at people with tax residency in Germany and Austria.
When registering, we ask you to provide a so-called reference account. This must be a current account (payment account) in your name at a credit institution based in the SEPA area.
Please note that a current account is not suitable as a reference account. If you would like to specify a joint account, please ensure that you are registered as the beneficial owner.
Yes, in addition to your “reference account” (e.g. your “house bank”), you can also use other checking accounts in your name to make deposits into your clearing account. These will be created either immediately or at the latest with the next rebalancing of your portfolio.
Yes, all incoming credits (including distributions) are automatically taken into account in the investment process.
Yes, many investors want to invest a certain, consistent amount each month for their retirement provision during their savings phase. Savings plans are just the thing for this. The setup can be done either directly when opening the account or at any time later in the personal customer area.
Direct debits for monthly savings plans are initiated on the first banking day of each month. The reference account is usually debited on the second or third banking day of the month. The amount will be credited to the respective portfolio on the following banking day.
Note: If the account is opened exclusively with a monthly savings plan, the direct debit for the first savings installment will be initiated immediately after the account is opened.
Many investors would like to receive a regular fixed amount during the withdrawal phase to cover their living expenses. To do this, you can set up a payout plan within Scalable Capital's asset management. The setup is easy via the Scalable app or web access. Additional, individual withdrawals are possible at any time.
If, in a specific case, withholding tax is due due to realized price gains, this is automatically withheld by the custodian bank for payment plans and individual withdrawals.
Payouts that would reduce the investment amount below the minimum investment amount of 20 euros are not possible. If you fall below this limit, your monthly payment plan will be deactivated.
Yes, at Scalable Capital you can create several individual portfolios with different level 1 asset allocations (dividing the portfolio into a risky and a low-risk part of the portfolio).
The selection is limited by your maximum risk category.
Please note that an additional clearing account and securities account is opened for each newly created portfolio. In addition, the minimum investment amount of 20 euros must be invested again.
Yes, a separate Level 1 asset allocation (dividing the portfolio into a risky and a low-risk part of the portfolio) can be set for each portfolio. For example, you can choose an 80/20 Level 1 asset allocation for your first portfolio and a 50/50 Level 1 asset allocation for your second portfolio. However, the selection is limited by the maximum permissible risk category specified for you. The maximum risk category is determined based on your investment objectives, your knowledge and experience and your financial situation.
Yes, you can switch your invested assets between the individual portfolios at any time. To do this, initiate a withdrawal in the portfolio from which you want to withdraw funds. Once the amount has been credited to your checking account, you can then instruct a deposit into the target portfolio.
The “Gerd Kommer” investment strategy is offered by Scalable Capital Bank GmbH as part of financial portfolio management. Gerd Kommer Invest GmbH advises Scalable Capital on the investment approach as well as on strategic and operational issues related to the strategy.
Scalable Capital Bank GmbH is a securities institution with permission from the Federal Financial Supervisory Authority (BaFin) for financial portfolio management (Section 15 Securities Institutions Act - WpIG). It is subject to supervision by the Federal Financial Supervisory Authority (BaFin) and the Deutsche Bundesbank.
Dr. Gerd Kommer points to his books For over 20 years, we have been pointing out the serious harm of conflicts of interest in the investment business. For this reason, it is fundamentally important for us to be completely independent. We do not receive commissions, commissions or “kickbacks” and do not use any in-house financial products. Only truly independent and conflict-free asset management will act in the best interests of the customer over the long term.
Neither Gerd Kommer Invest GmbH nor Scalable Capital Bank GmbH is authorized to obtain possession or ownership of the customer's assets. The customer's assets are held by the custodian bank. In the event of an insolvency of Gerd Kommer Invest GmbH or Scalable Capital Bank GmbH, the customer assets contained in the custody account do not fall into the relevant insolvency estate. Insolvency would therefore not affect the asset positions of investors (customers).
In the event of the custodian bank becoming insolvent, investors (customers) have a right to return their securities in their portfolio. Here, too, the securities do not fall into the bankruptcy estate of the custodian bank. The custodian bank only acts as custodian of the securities.
Balances in the customer clearing accounts at the custodian bank are guaranteed by the state deposit insurance up to a deposit amount of 100,000 euros (by the Federal Republic of Germany), as well as, in a significantly higher amount, by the deposit protection fund of the Federal Association of German Banks (BdB) - private deposit insurance (www.edb-banken.de/).
Furthermore, as a regulated securities institution, Scalable Capital Bank GmbH is assigned to the compensation scheme for securities trading companies (EdW) (www.e-d-w.de). The EdW pays compensation if an institution is no longer able to meet its “liabilities from securities transactions” to its customers for reasons directly related to its financial situation and the supervisory authority (BaFin) has determined that compensation is necessary. For this compensation, the protection is limited to 90%, but a maximum of 20,000 euros per investor. Such a compensation event can only arise in special constellations at a securities institution without permission to accept possession or ownership of the customer's assets (such as Scalable Capital Bank GmbH); This could include accepting customer money despite the lack of the relevant regulatory permission. Secondary claims (such as damages due to a faulty system) are generally not eligible for compensation.
From a legal perspective, the ETFs used are without exception so-called UCITS funds, i.e. mutual funds that are subject to EU UCITS fund legislation and regulation. The investor assets in these funds represent a so-called special fund. If an ETF provider goes bankrupt, the assets managed by the ETF provider are protected from access by the ETF provider's creditors and are completely separated due to their status as a special fund. The assets managed by ETFs (investor assets) do not become part of the ETF provider's insolvency estate and are therefore protected from access by the ETF provider's creditors. Only holders of ETF shares are entitled to their pro rata share of the assets managed by the ETF.
Protecting your personal data has the highest priority. Processing as part of the “Gerd Kommer” investment strategy takes place via the infrastructure of Scalable Capital GmbH.
Scalable Capital uses modern IT infrastructure to ensure the security of your data. The personal data you provide (e.g. address, account details or information about your financial circumstances) will be transmitted and processed in encrypted form at all times. Storage takes place in data centers within Europe.
2-factor authentication (2FA) protects your account with a second security factor in addition to your password - usually your linked smartphone with the Scalable app.
After logging in, confirm your identity via a push notification in the app (e.g. via Face ID, fingerprint or device PIN). This means your account remains protected even if your password becomes known. 2FA is used for logins as well as for security-relevant changes such as personal data or the reference account.
You will receive one upon setup Backup code. This is important if you lose your smartphone, change it or no longer have access to your device. Therefore, keep it safe. Without a linked device and without a backup code, identity verification by support is required. To use 2FA, you need the Scalable app installed and an active internet connection.
For more details, step-by-step instructions and up-to-date information, see the official FAQ page on 2-factor authentication from Scalable Capital.
Yes, you can cancel at any time for free.
No, there is no minimum holding period or minimum term. You can terminate the asset management contract at any time. The “Gerd Kommer” Robo Advisor strategy invests exclusively in ETFs that can be traded on every trading day in order to offer you the best possible liquidity.
However, a longer investment horizon can be advantageous for investing and reduce investment risks. Particularly in the event of negative performance, a longer holding period increases the likelihood that the portfolio can recover.
You can cancel your portfolio free of charge at any time via the Scalable Capital app or web access (under “Home” > Product selection > “Gear”).
Once notice of termination is received, the securities held in your portfolio will be sold. Pending transactions are processed properly beforehand. Execution takes place as quickly as possible, usually no later than the next banking day. Please note that same-day execution cannot be guaranteed, even on trading days.
After the sales are completed, the remaining balance will be transferred to your stored reference account. The account and securities account will then be closed. The value date on your current account usually occurs within six to nine banking days after the value date of the sales.
Even after termination, you retain access to your personal area and can access important documents - such as your annual tax certificate - in your mailbox.
We reject any form of “market timing” – the attempt to “avoid” “bad” market phases – because it does not work reliably enough and can be detrimental to returns in the long term. This rejection includes valuation-driven market timing. We believe that the investment principle of always investing immediately when you receive money that you basically want to invest is very sensible.
In this context, the blog post “Overvaluation of the stock market – what to do?” by Gerd Kommer may be of interest to you. This blog post makes it clear, among other things, that many of the popular statements published about supposedly highly or overvalued or hot markets are technically incorrect misunderstandings and confusions. It is also explained that even a very highly valued stock market still has a higher expected return than, for example, overnight deposits at banks or savings accounts.
Market timing in terms of entry timing works just as poorly as market timing in general. Gerd Kommer has a detailed blog post about this with the title “Timing of market entry – does it work?" written.
On a statistical average, when it comes to the stock market, entering immediately with the entire amount intended for the investment in one amount is clearly more profitable than entering in partial amounts over e.g. B. twelve or 36 months.
For psychological reasons, however, a stretched entry can make sense for some private investors.
As part of the “Gerd Kommer” investment strategy within Scalable Capital's asset management, risk management is generally not carried out via the timing of market entry, but rather via the selected strategic asset allocation (Level 1 asset allocation), i.e. the division of the portfolio into a risky and a low-risk component.
If you are currently worried about whether now is the right time to start, you can start with a consciously conservative (low-risk) Level 1 asset allocation and then, once these concerns diminish, “upgrade” to a more ambitious Level 1 asset allocation possible within your maximum risk category (i.e. a Level 1 asset allocation1 with a higher proportion of the risky portfolio component).
Gerd Kommer has a blog post on this question entitled “Entry into the stock market: one-time investment or phased investment?" written.
Short-term bonds with a high credit rating and a short remaining term in the investor's “home currency” are the lowest-risk asset class in terms of fluctuations in returns and default risk. Science sees it that way and it has to be that way for logical reasons. Gerd Kommer explained this logic in a blog post entitled “The concept of cash flow cascade” shown.
There is no economically relevant difference between withdrawals from the portfolio from distributions (dividends and interest) and withdrawals from the portfolio from the sale of shares. Gerd Kommer has a blog post about this with the title “Depot withdrawals: myths and misunderstandings” written.
A division of asset classes into “tangible assets” and “non-tangible assets” is of little economic use. Tangible assets are e.g. B. Stocks and real estate, non-material assets include bonds, bank deposits or claims to private or state pension insurance. Gerd Kommer has a blog post about this with the title “The concept of real asset investing: facts and fantasies” published.
The following applies to an investor with loan liabilities: If the investor does not invest exclusively in the risky part of the portfolio (i.e. has a 100/0 level 1 asset allocation), then he is entering into a so-called “negative interest differential transaction”. Whether a capital investment makes sense in this constellation cannot be answered in general terms. Gerd Kommer has a blog post about this with the title “Negative interest rate differential transactions – harmful and unnecessary" written.
On the one hand, the global market share of “passive investing” - if you measure it correctly - is much lower than is often misleadingly published in the media and on the other hand, over the last 25 years, with the bursting of the dot-com bubble, the Great Financial Crisis and the Corona crisis, ETFs have passed several stress tests of their legal structure very well.
Gerd Kommer has written a blog post on this and other issues in connection with “criticism of ETFs” entitled “The absurd demonization of ETFs" published.
In the context of passive investing, rebalancing is the periodic restoration of the original, consciously chosen portfolio structure after it has shifted due to different return developments of the individual portfolio components - a situation that inevitably occurs and is normal over longer periods of time.
Rebalancing does not contradict the buy-and-hold principle, which is very important in Gerd Kommer's Robo Advisor strategy.
In ours White paper Let's go into more detail about rebalancing.
Since high-risk asset classes (e.g. stocks) have higher long-term returns than low-risk asset classes (e.g. bonds), if rebalancing is avoided, the risky parts of the portfolio will assume an increasing weight in the portfolio over time. This makes the portfolio riskier. From a rational point of view, this is not desirable.
Rebalancing is primarily used for risk management. However, rebalancing can also have a slightly yield-increasing effect within asset classes with similar return potential.
In ours White paper Let's go into more detail about rebalancing.
Rebalancing is always carried out when the current allocation is sufficiently far away from the target allocation. The distance between the current allocation and the target allocation is determined every day.
To illustrate: According to the backtest, for a 50/50 portfolio consisting of 50% risky and 50% low-risk portfolio part, this would have been the case on average once a quarter over the period from the beginning of 2005 up to and including August 2020; for all other level 1 asset allocations from 100/0 to 0/100, rebalancing would be performed slightly less frequently, but on average always at least twice per year.
The rebalancing of individual customer portfolios is based on threshold values. To put it simply, we use the threshold value as the total deviation of the current weights of all security positions from their target weights.
This means that if there is a sufficiently large deviation between the current weights of the security positions and their target weights, a rebalancing is automatically triggered, returning the portfolio to its target allocation.
The deviation between the current weightings of the individual security positions and their target weightings is checked every trading day. This allows us to rebalance the portfolio towards its target allocation whenever necessary, thereby controlling portfolio risk.
The “Gerd Kommer” investment strategy is based on fundamental trust in the long-term positive development of the global market economy, i.e. the long-term growth of the global economy. The global economy has demonstrated this positive development over the past 250 years during a number of serious political and economic crises.
We are also convinced that the capital market (market for listed stocks and bonds) has a high degree of “information efficiency”. This is fundamentally different from almost all other markets. Information efficiency means that at any given time there is a high probability that all publicly available information about a security is already included in its market price or price (valuation) and therefore speculation based on public information after costs is a counterproductive exercise.
What we therefore resolutely reject are:
All of these bets represent “bad risk”, i.e. risk for which the capital market does not pay any compensation (expected return) from an ex-ante perspective.
In order to allow our customers to participate as best as possible in the general, long-term growth of the global economy, we invest for them worldwide in all important asset classes: stocks, government and corporate bonds, including stocks and bonds of real estate companies and stocks of raw materials companies.
In order to give our customers access to these asset classes, we invest exclusively in index funds in the form of strictly regulated ETFs (“exchange-traded funds” or “exchange-traded funds”), which represent these asset classes in the form of several thousand individual securities from up to 190 countries (according to the location of the primary listing of the companies, this is approx. 45 countries).
Other essential principles in our investment approach include:
You can find a detailed description of our investment approach in our White paper.
No, our investment approach is commonly referred to as “passive investing”. It is based on a long-term, forecast-free, disciplined buy-and-hold philosophy with a portfolio of very broadly diversified (spread), transparent index investments (ETFs) with the lowest possible costs.
This approach deliberately avoids predicting security prices or other economic variables, such as stock market trends, interest rates, inflation, currency prices, economic growth, industry developments and others. Because such forecasts don't work in at least half of all cases, but reacting to them incurs considerable costs, we avoid this counterproductive back and forth, in and out. As a result, there is a high probability of doing better than 90% of all comparable “active” investors in the long term.
Gerd Kommer explained why “active investing” should be rejected in a blog post entitled “Ten reasons why active investing works poorly” summarized.
You can find a detailed description of our investment approach in our White paper. The Books by Dr. Gerd Kommer explains and describes the approach in more detail.
There are now several thousand studies showing that active investing, which always represents a mixture of asset picking and/or market timing, does not work reliably when costs are taken into account. Passive investing is the superior alternative. Gerd Kommer has a detailed blog post entitled “Ten reasons why active investing works poorly” written that summarizes why we oppose active investing.
You can find a detailed description of our investment approach in our White paper.
If there are strong downward movements in the general stock market in a comparably short period of time (e.g. over six to 36 months) and these price losses cumulatively exceed around 20%, one typically speaks of a “crash” (after this mark has been reached).
During such strong market downturns (collapses), we simply do “nothing”. We neither initiate sales in our clients' portfolios solely because of downward movements nor do we delay previously planned purchases of securities.
We carry out the planned regular and mechanical rebalancing (see also frequently asked questions about “rebalancing” for details) as planned and completely “normally”, which can have a very long-term effect on increasing returns. In a stock crash, rebalancing will result in a shift from the low-risk part of the portfolio to the high-risk part (“re-buying”) if the stock market had a strongly negative return (severe price losses) before the rebalancing point.
Some key considerations on “What to do in a stock crash?” Gerd Kommer wrote using the specific example of the “Corona Crash” (which began in mid-February 2020) in a blog post entitled “The Corona crash: what to do?” shown.
You can find a detailed description of our investment approach in our White paper.
There are also in-depth information on numerous specific aspects of the investment concept Blog posts, YouTube videos and Podcasts.
An even more detailed theoretical and empirical justification of the approach is provided by: Books by Dr. Gerd Kommer.
Basically, the “Gerd Kommer” investment approach is based on: all Investing in stocks and “overweighting” a few broad segments of the stock market identified using statistical methods (so-called factor investing).
We do not aim to deliberately overweight stocks with high dividend yields because, in our view, there is no sufficiently convincing empirical evidence of a systematic advantage of stocks with high dividends in terms of return and risk. Gerd Kommer has a blog post about this with the title “Dividend strategies: facts and fantasies” written.
No, ESG criteria are not specifically taken into account as selection conditions for ETFs (and therefore for the underlying stocks and bonds) (“ESG” stands for environmental, social and governance; “SRI” stands for socially responsible investing).
When it comes to ESG investing, an investor's individual value system naturally plays a key role. There are big differences between the preferences of individual private investors. Therefore, it would be difficult to construct an ESG portfolio that meets the needs of all investors equally.
In line with established scientific findings, we believe that investing in individual securities (stocks or bonds) is not a good idea. “Individual value risk” is additional risk that can be diversified away and, from a scientific perspective, is not compensated for by a correspondingly higher expected return. If you are specifically interested in this point of view, we recommend the blog post by Gerd Kommer entitled “The questionability of individual stock investments”.
The low-risk portfolio part is the “safety anchor” in the portfolio. Its task is not to contribute the highest possible return to the overall portfolio (this is the task of the risky part of the portfolio), but rather its task is to bring as much “security” and “stability” as possible into the overall portfolio. Furthermore, it should be noted in this context that inflation-adjusted (real) “zero returns” on super-safe bonds (bonds with the lowest possible yield fluctuations and the lowest possible default risk) have historically been the norm. “Zero returns” (real returns close to zero) for this asset class are by no means a new phenomenon in the recent past, as is often suggested in the media and the public, but rather the historical rule. Gerd Kommer has a blog post about this with the title “Zero interest rates and investment shortages – real or just constructed?" written.
For bonds, there is a negative (inverse) relationship between remaining term and interest rate risk. Interest rate risk for bonds is the risk of price losses if market interest rates rise. Since the low-risk portfolio part acts as a “risk anchor” within the “Gerd Kommer” investment strategy, any risks, including interest rate risks, should be minimized. We therefore limit ourselves to short-term bonds with a high credit rating in the investor's home currency. Gerd Kommer has a blog post about this with the title “The interest rate risk on bonds" written.
For many private investors, bank deposits appear to be the lowest-risk form of investment. Unfortunately, this view is only correct with regard to the special or individual risk of “return fluctuations”. Here, bank deposits are actually the lowest-risk financial product. For many other types of risk – e.g. B. Default risk – bank deposits are, however, very risky.
From an economic perspective, a bank deposit is an unsecured loan from the depositor to a company in the financial sector. Almost without exception, banks are “highly indebted” companies with a typical debt capital ratio of 90%. This rate exceeds that in all other sectors. Individual bank bankruptcies and industry-wide “systemic” banking sector crises have historically occurred many times in all Western countries, most recently worldwide and in Germany from 2008 to 2012. Gerd Kommer has a blog post about this with the title “The underestimated risk of bank deposits" written.
Emerging market hard currency (USD) government bonds have historically delivered attractive returns, while maintaining comparatively low volatility and low correlation to other asset classes, including emerging market equities. Gerd Kommer has a blog post about this with the title “Emerging market government bonds – an asset class worth considering?" published.
Since emerging market government bonds do not meet the three criteria for the low-risk part of the portfolio, they must be assigned to the risky part of the portfolio. These three criteria are: low credit risk (default risk), low interest rate risk and no exchange rate risk. Gerd Kommer has a blog post about this with the title “Emerging market government bonds – an asset class worth considering?" written.
No, because in our view gold and other precious metals (especially platinum and silver) represent an unattractive asset class in terms of their long-term historical return-risk combinations. Furthermore, there are a number of factual arguments against adding gold or other precious metals. Gerd Kommer has a blog post about this with the title “Gold as an investment – do you need it?" written.
However, stocks and corporate bonds from precious metal producers (e.g. mining companies) as well as from companies that process or sell precious metals are part of the global capital market. Such companies are indirectly included in the portfolio via the broadly diversified ETFs of Gerd Kommer's Robo Advisor strategy.
With the exception of precious metals, investing in physical raw materials (such as oil, precious metals or wheat) is generally not realistically possible for private investors. This fact may not be clear to some investors. This lack of opportunity is related to the high storage and insurance costs for physical raw materials. Realistically, the only investments possible are in commodity futures, which are also available in ETF form (more precisely ETC form). Commodity futures are so-called derivatives, i.e. “derived” securities. The return and risk of commodity futures differ greatly from the underlying physical commodity market (“spot market”).
Apart from that, we generally do not see commodity futures as an attractive asset class from a risk-return perspective.
You can find more information about this in our White paper.
Anyone who has set up a savings plan (regularly investing consistent amounts in the capital market) will experience the cost averaging effect (also known as dollar-cost averaging). Due to the normal price fluctuations of stocks, regularly investing a constant amount of money results in the average share price in the investor's portfolio being lower than the corresponding average share price in the market. However, this purely mathematical effect does not have a systematic return-enhancing effect on the investor's long-term return, even though this is exactly what has been reported in the media and in the world for decades Financial advice books is postulated.
Although the repeatedly claimed advantageous return effect of cost averaging does not actually exist, it is still fully recommended to build assets and make retirement provision through a long-term fund savings contract.
Rule-based, mechanical investing in the stock market in consistent monthly amounts can be very advantageous, especially psychologically, because it removes or at least greatly reduces the “pressure to make decisions” from the investment process. In addition, the investor of course benefits in the long term from the well-known compound interest effect.
Gerd Kommer has a detailed blog post about this with the title “The legend of the cost averaging effect" written.
Perhaps Gerd Kommer’s blog post entitled “Entry into the stock market: one-time investment or phased investment?” interesting to you.
We divide our portfolios into two main components. This is, on the one hand, the risky and, on the other hand, the low-risk part of the portfolio. We always mention the risky part first (in our example 60%) and the low-risk part last (in our example 40%). This simple regulation allows you to immediately see at any time what risk-reward ratio your portfolio represents.
The risky part of the portfolio consists primarily of globally diversified stocks, taking into account so-called factor premiums (you can find further information about factor premiums in our White paper) and to a small extent from emerging market government bonds in hard currency (USD). The risky part of the portfolio represents the “return engine” in the overall portfolio.
The low-risk part of the portfolio consists of bonds with a high credit rating with a short remaining term in the investor's “home currency” (euro) in order to minimize default risk, interest rate risk and exchange rate risk. The low-risk portfolio part represents the “safety anchor” in the overall portfolio. It ensures that the overall portfolio fluctuations are reduced.
The low-risk part of the portfolio has the primary task of contributing security to the overall portfolio, not returns. If you want a higher expected return, you have to increase the proportion of the risky part of the portfolio (and in return reduce that of the low-risk part) - while consciously accepting the associated increased risk in terms of fluctuations in value and returns.
Even though we fundamentally follow a so-called “passive” investment approach with a buy-and-hold philosophy, adjustments and changes during ongoing operations are occasionally necessary and sensible. For example, whenever ETF products come onto the market that allow us to achieve cost savings or other advantages for investors without having to accept other disadvantages at the same time. Such adaptation measures always only take place as part of a specific cost-benefit analysis.
You can find more information about rebalancing under the frequently asked questions about rebalancing and in our White paper.
In principle, it cannot be ruled out that there will be potential for further development of the investment approach at greater intervals due to relevant advances in science.
We attach great importance to the greatest possible diversification.
In the equity part of the portfolio, this means several thousand individual stocks from up to 190 countries (according to the location of the primary listing of the companies, this is around 45 countries).
In the bond section, this means several hundred different individual government and corporate bonds from many dozens of different issuers.
For emerging market government bonds (which are part of the risky part of the portfolio), we diversify across at least 20 different emerging markets.
You can find more information about the aspect of diversification in our White paper.
Yes, since it can happen and is even quite likely that an investment strategy that was adopted in the past no longer meets current needs and circumstances at a later point in time, you can change flexibly at any time up to your maximum risk category. The reasons for this can be varied: changes in your assets and income situation due to career changes, real estate investments, starting a business, inheritances or gifts or due to the gradual approach to the end of your working life (retirement). Increased financial and capital market knowledge over time as well as experience and familiarity with your portfolio can also play a role; also changing attitudes towards life and the future in general. All of this and much more can and will influence your investment strategy.
Every year, 60% of all listed companies worldwide pay dividends (distributions) to their shareholders. You generally participate in these distributions via the ETFs used as part of Gerd Kommer's Robo Advisor strategy.
Distributions (e.g. dividends or interest) incurred by the ETFs used are credited to your clearing account at Scalable Capital and automatically reinvested according to your chosen investment strategy.
In principle, you can reduce the invested volume of your Gerd Kommer Robo Advisor strategy at any time, as long as the minimum investment amount is not less than 20 euros per portfolio.
However, we strongly advise against doing this for “market timing reasons”, i.e. the expectation of avoiding temporary bad stock market phases. From a scientific perspective, market timing is clearly inferior statistically and in terms of returns to a long-term, disciplined buy-and-hold strategy. The scientific studies that have proven this again and again for around 60 years are now legion. In the Investment books by Dr. Gerd Kommer mentions some of the best-known studies on this subject and summarizes many of their results.
Because this is the case, we do not do any market timing with the “Gerd Kommer” investment strategy, i.e. h. We will not reduce the risky part of our customer portfolios over time and, in particular, we will not reduce them in a strong downward market movement or a “crash”.
If you sell shares in your portfolio, the liquidation proceeds will be credited to your reference account within a few working days.
Whether an investment strategy is successful or not in the long term can be seen by comparing it with a suitable and predetermined reference value (so-called benchmark). A benchmark is defined as a fictitious portfolio consisting of an investment in a global equity fund and an investment in German government bonds. The respective weighting of these two investments results in a meaningful benchmark for each investment strategy that corresponds to the respective risk exposure.
The benchmarks for the individual allocations are in the Terms of contract contain.
In factor investing – often called smart beta investing – so-called factor premiums are overweighted compared to a market capitalization-weighted index. Normal securities indices, e.g. B. the DAX or the MSCI World Index are weighted according to the principle of market capitalization. This means that the weight of an individual stock company in the index, be it Apple or BMW, is determined by its market capitalization (also called stock market value). Market capitalization is the market value of the company's equity.
With factor investing, it is no longer just market capitalization alone that determines the weight of a company in the index, but also other “factors”, i.e. “factor premiums”. An example: The value factor expresses whether a share is inexpensive relative to certain business variables such as profit or book equity.
Factor premiums are statistically identifiable drivers of return and risk in an asset class (here in the asset class stocks). They explain a large part of the return-risk combination of a diversified portfolio. By overweighting factor premiums in a portfolio relative to a "market neutral" portfolio (the overall market), its expected return can be increased relative to an appropriate market neutral benchmark. Gerd Kommer has a blog post about this with the title “Factor investing – the basics" written.
In the “Gerd Kommer” Robo Advsior strategy we use the factor premiums Small Size, Value, Quality and Momentum in the equity segment.
Compared to a market-neutral portfolio weighted purely by market capitalization, we also overweight emerging markets. Some scientists also see the historical excess return that emerging market stocks and bonds have compared to comparable stocks and bonds from developed countries as a type of factor premium - the political risk premium.
No, factor investing can also lead to lower returns over longer periods of time than not doing factor investing, i.e. investing in a market-neutral stock portfolio. The expected return advantage of factor investing only becomes apparent in the very long term, just as the stock market is generally only more profitable in the long term than, for example, B. the asset class bonds or real estate. There is therefore no guarantee that higher returns can be achieved with factor investing in a given year or even decade than with market-neutral investing. Gerd Kommer has a blog post about this with the title “The Pains of Factor Investing" written.
In our opinion, the differences in terms of return and risk between “simple” (“fund-level” or “index-level”) and “integrated” (“stock-level”) multifactor investing are rather small.
An important practical criterion for weighing up and deciding between the two alternative factor investing philosophies is the availability of corresponding ETF products in Germany. In our opinion, the available product landscape for integrated multifactor investing is still too narrow and therefore the desired price competition between product providers is also too low. In addition, in our opinion, the specific ETF products in the integrated multifactor area are not all diversified broadly enough. For these reasons, we chose simple multifactor investing for the Robo Advisor strategy. If the situation changes at some point such that the advantages of integrated multifactor investing outweigh the disadvantages of the corresponding products, we will take this into account in the portfolio construction.
The fees for the Robo Advisor strategy depend on the average portfolio value in the corresponding billing period and are as follows:
Up to 100,000 euros: 0.70% p.a. a.
From 100,000 euros: 0.65% p. a.
From 250,000 euros: 0.60% p. a.
The reduced fees apply to the entire portfolio value. This already includes all transaction costs. The fees are calculated on an individual portfolio basis on a daily basis based on the average managed customer assets; billing is carried out separately on a monthly basis for the asset manager and the custodian bank. The fees are debited from your clearing account at the custodian bank (Scalable Capital Bank).
Other fees, e.g. B. for account and securities account management or for transactions (purchases and sales) do not apply. This also applies to setting up and executing savings and withdrawal plans.
In addition, the ETF providers charge ongoing costs, which, depending on the ETF, are currently 0.09% p.a. in the best case scenario. a. and in the most expensive case 0.45% p.a. a. - the average cost of the products is around 0.20% p.a. a. These costs are already included in the ETF returns (so they are not charged separately). Investors would also have to bear the product costs if they purchased these ETFs on their own.
The minimum investment amount is 20 euros.
We only earn money from the service fees.
We do not receive any income from the products (ETFs) in client portfolios as we do not take any commissions, commissions or “kickbacks” from the ETF providers or other third parties.
If cheaper ETFs are used over time in the Robo Advsior strategy, then this cost reduction will 100% benefit Gerd Kommer Invest's customers.
The income varies neither with the specific way in which the “Gerd Kommer” investment strategy is generally invested nor with the level 1 asset allocation (division of high-risk versus low-risk) of a specific customer portfolio.
The purpose of the compensation system and its structure is to prevent or reduce harmful conflicts of interest as much as possible.
Yes, until further notice the service fees are reduced by 0.70% p.a. for portfolio values of 100,000 euros or more. a. to 0.65% p.a. a. and from 250,000 euros to 0.60% p.a. a. The reduced fees apply to the entire portfolio value.
The product costs charged by the ETF providers are already included in the returns of the ETFs and their percentage amount is therefore independent of the investment volume.
Yes, because the applicable service fee percentage is based on the average market value of the client's assets under management in the billing period. The service fees that are applicable in the billing period are billed every month.
No, we do not charge our customers performance fees because, firstly, performance fees inevitably cause harmful conflicts of interest and, secondly, they do not increase the long-term return of customers - as is often claimed - but decrease them. Gerd Kommer has a blog post about this with the title “Performance fees – appearance and reality" written.
Dr. Gerd Kommer points to his books has been pointing out the harmfulness of conflicts of interest for over 20 years. For this reason, it is very important for us to be independent. We do not receive any commissions, commissions or “kickbacks” from ETF providers or other third parties, as only truly independent and conflict-free asset management will permanently act in the best interests of the customer. In the event that we ever receive such donations and they cannot be avoided for technical reasons, we undertake to pay out these donations to the customers as part of the asset management agreement with our customers.
We only accept non-monetary donations if they improve the quality of asset management and do not conflict with customer interests. This can be financial analysis, information material, training or technical services. We will disclose to you whether we accept this type of donations.
Representing a securities index through an ETF is usually much cheaper for the investor than investing in conventional investment funds. We select ETFs that are as cost-effective as possible for our customers.
The ongoing costs (including management fees) are currently 0.09% in the best case and 0.45% in the most expensive case - the average cost of the products is 0.18%. These costs are already included in the ETF returns (so they are not charged separately). Investors would also have to bear the product costs if they purchased these ETFs on their own.
The calculation is carried out on a daily basis based on the average managed customer assets (i.e. based on the capital employed).
Exchange-traded funds (“ETFs”) are exchange-traded investment funds that track and replicate the performance of a stock market index – such as the MSCI World – without a fund manager making active investment decisions. They are therefore also referred to as “passive” funds or index funds. Like a mutual fund in general, an ETF pools the investment money from many investors and invests it in a diversified portfolio of stocks or bonds. ETFs have a number of advantages over actively managed funds:
In other words: ETFs allow you to invest broadly and cost-effectively and to participate in asset class returns to the highest possible extent.
Our selection of specific ETFs from the approximately 1,500 currently sold in Germany takes place in a multi-stage process that is repeated approximately every three months.
The most important quantitative and qualitative ETF selection criteria are as follows:
Low costs: Avoiding costs is one of the most important criteria for long-term investment success. When selecting ETFs, we pay particular attention to the total expense ratio (TER), which indicates the total costs of index replication, as well as the total cost of ownership (TCO), which takes into account external trading costs such as bid-ask spreads, taxes and broker commissions.
High Liquidity: ETFs with low trading liquidity typically have wider “bid-ask spreads,” which increases trading costs. We pay attention to ETFs with large investment volumes and multiple market makers to ensure the best possible tradability and minimize trading costs.
Adequate diversification: ETFs usually track very broad market indices, with dozens, often hundreds or thousands of individual stocks. This broad risk diversification enables access to the fundamental return drivers of the respective asset class without having to accept high individual risks. On the other hand, very broad indices contain a so-called long tail, i.e. a number of smaller companies with lower liquidity and therefore higher trading costs. Our selection process ensures a balanced and favorable relationship between risk diversification and implicit trading costs of the ETFs.
Secure replication method: ETFs are offered in two basic versions: with physical and synthetic replication of the underlying index. We only use physically replicating ETFs.
Other criteria we take into account are the closure risk associated with the fund size and on which low-cost exchanges the ETF is traded in euros.
It is not necessary to diversify across as many different ETF providers as possible, as the investor funds in ETFs represent “special assets”. A theoretically possible insolvency of the ETF provider would therefore be irrelevant to the investors' asset position.
Accumulation funds (ETFs) are the more sensible choice in most constellations. A number of arguments for distributing funds (ETFs) do not stand up to sober, critical scrutiny. From an economic point of view, however, the differences between the two fund variants are limited anyway. Gerd Kommer has a blog post about this with the title “Distributing vs. accumulating funds" written.
Yes, tax criteria are also taken into account when selecting ETFs.
In general, we only use ETFs that have German “tax reporting” so that there is no risk of disadvantageous flat-rate or “punitive taxation”.
We also take into account the optimization of withholding tax aspects for stock ETFs (stock ETFs with fund domicile in Ireland can have advantages here compared to stock ETFs domiciled in other countries).
And finally, where possible, we try to take advantage of the slight tax advantage that accumulating ETFs have over distributing ETFs under current German tax law.
The tax burden at investor level is paid directly by the custodian bank. This means that there is no additional effort for the investor in the tax return.
In the risky part of the portfolio, we consider currency hedging to be unnecessary or, on balance, disadvantageous.
In the low-risk part of the portfolio, we only use bond ETFs denominated in euros or hedged in euros without any exchange rate risk.
Gerd Kommer has a blog post about this with the title “Currency hedging: when does it make sense and when does it not?" written.
No, we only invest in ETFs with so-called physical replication, i.e. ETFs that physically hold the securities specified by the relevant securities index (or a representative sample of them).
Leveraged ETFs are stock ETFs that acquire shares partly using debt capital or loans (i.e. not just equity that comes from the ETF investors. The “Gerd Kommer” Robo Advisor strategy does not use any leveraged ETFs.
Short ETFs are stock ETFs whose return is inverse to the market, i.e. h. Short ETFs return positively when the corresponding security index returns negatively. Short ETFs are a tool for betting on falling markets. With the “Gerd Kommer” Robo Advisor strategy we do not use any leverage ETFs.
Yes, we invest in ETFs that practice securities lending.
Below is a brief explanation of the often misunderstood topic of securities lending: Securities lending may be practiced indiscriminately by all investment funds - active and passive - not only by ETFs, but also by actively managed investment funds, hedge funds, sovereign wealth funds, pension funds and other institutional funds. Most of the approximately 1,500 ETFs sold in Germany, but not all, practice securities lending. Securities lending has existed for decades and, to our knowledge, has never caused damage to private investors in investment funds (UCITS funds) - not even in the three major stock market crises after 2000. In investment funds, securities lending is a strictly regulated and low-risk, but of course not risk-free, business that generates additional income for the fund. This additional income benefits investors directly or indirectly. Their amount is proportionate to the low risk of securities lending.
If you have any questions about our robo advisor strategy, write us a message or call us.
📱 Phone: +49 89 215 298 12
📫 Email: ed.latipac-remmok-dreg@ecivres
Monday to Friday from 9:00 a.m. to 7:00 p.m
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If you have any questions about our robo advisor strategy, write us a message or call us.
📱 Phone: +49 89 215 298 12
📫 Email: ed.latipac-remmok-dreg@ecivres
Monday to Friday from 9:00 a.m. to 7:00 p.m
Subscribe to our newsletter to stay informed about new blog posts, the latest Book of the month and news from Gerd Kommer as well as ours White paper to obtain.
Our regulations apply Privacy Policy.
