Fra Zerohedge:
Having traded in a narrow range for 3 months, Swiss stocks tumbled last week amid contagion concerns over Deutsche Bank. With valuations at their highest realtive to Euro peers since 2008, it appears investors are hedging aggressively. Bearish Swiss stock option positions out-number bullish by the most since Lehman (after which SMI fell by 50%).
“probably nothing”
Bloomberg paints a rosier picture, noting an exodus from defensive plays made Swiss equities lag most developed markets this quarter, sending the number of outstanding bearish options to an eight-year high versus contracts betting on gains.
A run into companies including Novartis AG and Roche Holding AG in the immediate aftermath of the Brexit vote pushed Swiss valuations to the highest since 2008 relative to their euro-area peers.
“At a certain point you start taking a chance with other stocks — there are just more opportunities out there,” said Ion-Marc Valahu, co-founder and fund manager at Clairinvest in Geneva.
But we can’t help but worry when UBS CDS have risen 11 straight days…
