RHHBY - EWL: Swiss Equities Look Unattractive As CHF Is Likely Overvalued While EWL's Portfolio Mix Offers Low Growth Potential

• Swiss equities have underperformed U.S. equities historically if we compare EWL with the S&P 500 index, or the SPY tracker.
• An important reason for this is, in spite of the sophistication of the Swiss economy, that the United States is home to the tech stocks which benefit from scale effects.
• CHF meanwhile appears overvalued relative to USD. At some point, this trend is likely to reverse, even if such a reversal depends on more significant SNB intervention.
• The "tail risk" of a future headwind in the exchange rate movement, coupled with the fairly stolid portfolio mix of EWL, makes EWL relatively unattractive.
• I would not recommend EWL to U.S. investors and would go as far as to suggest that Swiss investors would be better off investing abroad.

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