Swiss Francs as hedge in market chaos

Investing / Funding & Currency conversions
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Interesting times in the markets, not the least US treasuries and currency!

CHF/USD at 1.23! Up 8.4% in one month, 11.9% in a year!

When I look at my portfolio over the past month it is a bloodbath in CHF, double whammy on equities nosediving and CHF skyrocketing. Switch to USD and flat for the month! That pillar 2a with a pile of CHF is a marvelous counterbalance, not just as a protected asset but also as a currency hedge.

I have said before, what’s not to like about the pillar 2a - still stands.

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Yes, I was thinking of doing exactly this, but didn’t pull the trigger in time.

Gold is also an alternative.

And if you want to be more speculative, gold traders. GDX has pretty much been a horrible losing trade until the start of 2024 and this tariff war finally seems to be the trigger for the re-rating of gold miners.

But it doesn’t seem very popular:

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CHF money market fund is the best performing asset class this year it seems. Who would have thought :slight_smile:

There are so many so called “stores of value” but when things go really bad, the Gold Standard remains CHF & Gold.

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I did. I plowed massively into pillar 2a at start of year

In your survey, .. vs 2%… AND a 33% tax break. Plus the hedge. And still 93% say stay the course. Well I guess the above IS my version of staying the course :grinning_face:

This crisis is far from over imv. Currently dead cat bounce will fade quickly, we will have S&P500 with 30-40 pct drop from top, only this time recovery will be 2-3 years

I will start to buy large tranches of equities once we have had 10 pct drops in a single day, ie panic really sets in. Wont be long

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Trump can lower taxes for the super rich any time and cancel his 10% tariff blanket as well as china tariffs

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I think the tariff strategy has done real damage to investor psychology. Trump better get the deals done quickly.

I’m still hopeful that tariffs will be resolved and this could lead to a new massive bull run. But to get this, Trump will need to not just soothe existing fears, but excite animal spirits again.

I think a combination of ending tariff wars and ending Ukraine war could do it.

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Trust takes years to build , minutes to break and many more years to rebuild

Zelensky showdown was first straw, the blatant tariff chart was second and the China punishment (for retaliation ) was the last one.

I think it would take a lot of effort from US to rebuild the trust. But I actually think they will try the approach of „more bullying“ to align the allies.

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I think there is some lingering loss of trust in the US now. Trump and his cronies openly flaunting with their market manipulation, and creating major policy uncertainty with tweets.

This will have lasting consequences for a long time, even if course is reversed fully.

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The Bulwark are a bunch of republican anti Trump journalists. I found this opinion piece very interesting and I believe we are beyond the turning point.

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This video might be interesting

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Haven’t watched the video. Would think that CHF purely goes up in times of volatility because of unwinding carry trades, ie short CHF at low interest rate, buy high yielders such as AUD, NZD etc.

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I also didn’t know that CHF was backed up by gold for quite long time. The video provides some historical context too

But overall the main point seems to be that trust is earned over many many years and many cycles.

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Switzerland was forced to abandon gold backing when they joined the IMF:

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