‘M4’ Major Currencies (CHF)

Exhibit-01 (above)

Chart-01 displays the latest 18 months of currency values for the four currencies in this sample and an equal-weight basket thereof, rebased. On balance, the Japanese Yen has remained fairly stable vis-a-vis the Swiss Franc, while all other currencies have seen a more or less pronounced drop in value, particularly the €uro.

Exhibit-02 (below)

Chart-02 shows actual exchange rates, expressed in Swiss Francs, over the latest three years, as reference. The data is smoothed.

Exhibit-03 (above)

The history of Chart-02 is the basis for Table-01, showing exchange rates current and three year previous, as well as distance between current and extreme readings of the latest 36 months. The British Pound is at a three year low. Japanese Yen are the only currency to have risen mildly. The lower part of Table-01 shows observed risk (normalised over these 36 months). Across the board, to a CHF-based investor, exposure to foreign currencies has not been worth the risk.

Exhibit-04 (below)

In Chart-03 sixty months of history are shown, giving annualised return for individual currencies and the M4 composite. Here too, it is Sterling that stands out as the weakest of the currencies. For the specific time frame, all the other three currencies have actually risen.

Exhibit-05 (above)

Chart-04 shows history of the four currencies in the M4 basket, rebased to 120 months ago, the starting date of the graph. While the Japanese Yen may have seen the greatest swings in this time, it is the US Dollar that has managed to separate itself from the crowd by holding it’s value to the Swiss Franc since the end of 2015.

Exhibit-06 (below)

Table-02 gives, in the upper part actual FOREX rates at fixed points in time: ten, five, and three years ago, 12 months previous and latest year end. In the lower section, corresponding rates of change are calculated, highlighting in colour the best (green) and worst (red) performing currency.

Exhibit-07 (above)

Chart-04 gives 120 months of history of 3-year normalised returns of the four currencies. In the recent past and by this measure, all four currencies have converged. This is rather different to the years 2010-2013, or 2013-2015, when normalised rats of change of the four currencies to the Swiss Franc were much more apart.

Exhibit-08 (below)

Chart-06 calculates annualised rates of return for the M4 basket, and individual currencies, from 31.12.1999 to date. It may surprise that €uro/CHF has held up better than any of the other rates. But this reflects interventions by the Swiss National Bank, more than any other factor. All in all, one should not forget that the graph shows changes in value, annualised across a history of more than 20 years. Even single digit changes compound to significant gains, or losses over such periods of time. Put differently, the strength of the Swiss Franc has not only lasted for quite some time, but indeed gone very far.