[ad_1]
The Swiss National Bank now has foreign exchange reserves worth more than 850 billion Swiss francs. How do you keep this money?
The Swiss National Bank (SNB) is a major international investor with huge investments in foreign exchange valued at more than 850 billion Swiss francs. Most, around 40 percent, are held in euros. This reflects the importance of the common currency for the Swiss export industry. It keeps a good third of the money in US dollars and therefore the world’s leading currency.
Therefore, the SNB holds approximately three-quarters of its total foreign exchange investments in these two most important currencies: the euro and the US dollar. The remainder is divided into other major currencies, such as the Japanese yen, the British pound or the Canadian dollar.
Equity investments regularly in focus
The SNB does not hold its foreign exchange reserves in cash, but in the form of stocks and bonds. It is responsible for spreading its risks as widely as possible.
Equity investments, in particular, are a subject of public debate – they only make up about 20 percent of the entire pie, but even that is a whopping 170 billion! There are repeated demands that the SNB invest its money in a more sustainable way.
Incidentally, the SNB does not select individual stocks, particularly profitable ones, but rather tracks existing stock indices around the world. In doing so, the SNB wants to prevent it, as a major investor, from causing distortions in the stock market.
Stocks, bonds and gold
Similar to pension funds, the SNB invests most of its investments in bonds, particularly in government bonds (around CHF 600 billion). These papers are less volatile than stocks, for example.
More than a ton of gold is stored in the vault of the Swiss National Bank.
Keystone
In addition to these foreign exchange reserves of around 860 billion francs, the SNB still has a treasure trove of gold. There are a total of 1040 tons.
The gain is secondary
The SNB has amassed a huge mountain of foreign exchange worth more than 850 billion Swiss francs in recent years in its fight against an excessively strong Swiss franc. While a “normal” investor aims to generate the best possible returns on his investments, this is of secondary importance at Banco Nacional. You don’t have to primarily make a profit, but rather keep an eye on the Swiss franc.
The SNB’s result can fluctuate wildly from quarter to quarter, depending on how the prices of currency, stocks and bonds move, as well as the price of gold.
