At Obermatt, we believe in data-driven investment strategies that empower you to navigate complex market conditions. In this week’s Swiss Bliss podcast on Swissquote, Hermann Stern Jr. discusses the Swiss and US markets with Olga Miler, award-winning fintech entrepreneur, economist and host of Swiss Bliss.
Recent interest rate cuts haven't generated the surge in the SMI that some anticipated. This could be due to the frequent rate cuts by the European Central Bank and the Swiss National Bank, driving investors to adopt a wait-and-see approach, anticipating diminishing returns from further cuts.
Furthermore, dominant market players like Nestlé, Novartis and Roche have struggled to keep pace with the SMI and other indices. Obermatt’s 360° View rank for all three stocks are quite low. While ranks range from 1 to 100 (best), Nestlé weighs in at a meager 8, Novartis at 12, and Roche at 10. The SMI stocks ranking highly according to Obermatt’s comprehensive 360° View come from a different sector, with Richemont (76) and Swatch (70) coming in strong.
The picture isn't limited to the SMI's muted response. The US market faces significant challenges, including slowing economic growth and concerns about inflation. Additionally, high levels of consumer debt in the US market raise concerns about its long-term stability. This potentially volatile environment may make certain Swiss stocks a more stable alternative.
Our Obermatt method provides a framework for identifying promising investment opportunities. This method analyzes potential investments based on 15 financial and non-financial metrics, including value, growth, safety, and market sentiment metrics, all of which form Obermatt’s 360° View rank. Detailed ranks are also available for each of the 15 metrics.
Utilizing this approach, see exciting opportunities within the Swiss market, especially in companies like Richemont and the Swatch Group. These companies demonstrate strong fundamentals and a promising outlook. Obermatt uses the same algorithm-based method to select the top 36 stocks in the Swiss market that form the investible Obermatt Swiss Pearls Index (OMSP1). While Nestlé, Novartis and Roche are popular with many investors, they did not make the cut to be part of the OMSP1.