Index funds were pioneered by Vanguard's John Bogle in 1976 with the radical premise that the average investor cannot beat the market net of fees, so the rational strategy is to capture the market return at minimal cost. Forty years of evidence supports this: 85% of active US large-cap funds and around 80% of European large-cap funds underperform their index over 10 years.
An index fund typically charges 0.05–0.30% per year, versus 1.0–1.8% for an active fund. On a CHF 100,000 portfolio compounding for 30 years at 7% gross, this fee saving alone is worth roughly CHF 300,000 in extra final wealth. The trade-off is that you cannot outperform the index; you also cannot underperform by manager error.
Major index families in Europe include MSCI (World, Emerging Markets), FTSE (All-World, Europe), SPI (Swiss Performance Index) and STOXX (Europe 600). For a one-fund global portfolio, the MSCI ACWI or FTSE All-World tracks both developed and emerging markets in a single line. ETF wrappers from iShares, Vanguard, UBS, Amundi and Xtrackers replicate these indices with TERs from 0.07% to 0.30%.
An investor puts CHF 50,000 into a Vanguard FTSE All-World ETF with 0.22% TER. Over 25 years at a 7% gross return she accumulates CHF 271,000 — versus CHF 215,000 if she had paid 1.5% per year in an active fund of identical pre-fee performance.