Bonds for a Swiss investor in 2020

Investing / Portfolios
25

There’s a lot more nuance to that… I’d even argue the reverse would be worse, many people want to buy CHF, it’s reasonable to give it to them (and increase the balance sheet) instead of making the swiss economy uncompetitive.

(You’ll note that contrary to other central banks, they didn’t even increase the balance sheet to smooth out liquidity triggered by the 2020 crisis, most of the increase was while defending the exchange rate)

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26

But if the CHF loses value, the SNB assets would likely increase right? (as they are denominated in not-CHF)

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27

The biggest asset of a central bank is its credibility anyway.

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28

Clearly it a force that tends to protect the CHF’s value relatively to the foreign currencies the SNB is invested in. Now, the asset prices do fluctuate in their own currencies (again, it can be positive or negative)…

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