1. Newsroom
  2. Why Swiss equities should be considered in every equity allocation in 2024
Menu
Analysen 12.03.2024

Why Swiss equities should be considered in every equity allocation in 2024

Why Swiss equities should be considered in every equity allocation in 2024

Investors may find the strong fundamentals and stable economic, political and social aspects of Switzerland attractive in terms of equity investments in a year which may be dominated by geopolitical newsflow.


Indeed, 2024 will see an unprecedented number of elections around the world, potentially leading to concerning media coverage. Switzerland, by contrast, stands out as a beacon of stability.

One factor adding to the positive outlook on Switzerland is the normalisation of the Swiss franc, whose historical strength has nevertheless been an accelerator for Swiss companies’ productivity gains. Recent trends in 2024 indicate a slight weakening in the Swiss franc and a potential for an earlier interest rate cut. This could ease the currency headwinds of 2023 which pressured the earnings potential of Swiss companies expressed in Swiss francs.

Active investment solutions offer greater diversification compared with ETFs, which have to passively reflect the actual index weightings of the three mega-caps (Nestlé, Roche and Novartis), that together make up more than 40% of the SPI. We could therefore see other opportunities in the rest of the Swiss equity market, notably in the quality small- and mid-cap space, which cannot be easily accessed via passive solutions. The expected recovery of Switzerland’s GDP growth from 0.8% to 1.5% in 2024 could be an additional tailwind for the quality small- and mid-cap segment.

Swiss equities should be considered in any equity portfolio as a risk/return-enhancing allocation, as well as a source of diversification over the medium to long term, especially compared with European and global equities. With a similar 10% earnings growth expected in 2024 for both Swiss and US equities, but with more attractive valuations and less dependence on developments in the IT sector, Swiss equities are an attractive and differentiated investment proposal for 2024.

Our Swiss & Global Equities Expertise

Taylor-Jolidon_Eleanor_Square.jpg
Eleanor Taylor Jolidon
Co-Head of Swiss and Global Equity
View her Linkedin profile

Martin Moeller Martin Moeller
Co-Head Swiss and Global Equity
LINKEDIN PROFIL SEHEN
Expertise

Globale Aktien

In Unternehmen mit nachhaltig besserer Mehrwertschöpfung investieren.


Auch lesenswert

Analysen 21.05.2024

Embracing regenerative agriculture for sustainable growth

UBP’s impact team believes in the pivotal role regenerative agriculture has to play in addressing environmental challenges and fostering long-term prosperity. This theme can provide fertile ground for investors looking at impact investing.

Analysen 08.05.2024

UBP House View - May 2024

In light of the extended duration of high interest rates, we’re employing a carry strategy, ramping up our allocation to high-yield bonds.

Analysen 26.04.2024

Swiss equities back on the radar

Following a relatively lacklustre performance in 2023 and the Swiss National Bank’s recent interest rate cut, is now the time to revisit the Swiss equity opportunity set? In this Investment Rendez-Vous podcast, Eleanor Taylor Jolidon, co-head of UBP’s Swiss and Global Equity team, walks us through Swiss business models, current valuations and industries of particular interest.