health insurance risk based capital
Tags of my notes in the CHF from day trading the currency markets by Kathy Lien
Swiss Franc-CHF
Switzerland the 19 largest in the world economy
One of the richest nations in the world based on GDP per capita
Switzerland is known for its chemicals, pharmaceuticals, machinery, precision instruments, watches, and a financial system that protects the identities.
Banking and insurance employs more than 50% of the population and is over 70% of GDP
Time for risk aversion, capital flows drive the economy
During the search of risk sometimes flows trade to the economy
Two thirds of all trade is with Europe.
In recent years, merchandise trade flows has fluctuated between deficit and surplus
The current account had a surplus since 1966
Safe Haven Currency:
Switzerland has a history of being politically neutral.
Switzerland is the main currency of refuge. It attracts more foreign capital than any other country.
Because it is a safe-haven currency, the franc moves mainly in the external events rather than domestic economic conditions
Strong correlation with gold:
Switzerland is the fourth official world's largest holder of gold.
25% of the bank notes (money) backed by gold.
The Franco has an 80% correlation with gold.
Carry Trades:
Due to the low interest rates Switzerland's offer, the franc is a currency carry trade popular.
Futures:
The interest rate differences between 3 months Swiss Euro Futures and Eurodollar futures on 3 months are closely watched.
This indicates how much higher returns on U.S. fixed assets income offer on Swiss fixed income assets.
The differential provides traders with indications of potential currency movements (since investors tend to seek higher yields high interest).
This is particularly important to carry traders who enter and exit your trade based on interest rate differentials.
Regulation:
The Swiss are under pressure to relax the confidentiality and increase the transparency of the banking system.
Because the confidentiality of your accounts is a major strengths of its banking system, any discussion of this impact the franc.
Mergers and Acquisitions:
Since banking is a major industry, mergers and acquisitions can have a significant impact on the franc.
Cross-Currency:
The EUR / CHF is most commonly marketed the CHF / USD, because EUR / CHF is more liquid and less volatile.
Day traders, many prefer the USD / CHF due to increased volatility.
The USD / CHF is only a two synthetic derivatives of the EUR / USD and EUR / CHF.
EUR / USD and EUR / CHF are used as indicators for trading USD / CHF
In theory, rate / USD CHF should be exactly like EUR / CHF divided by EUR / USD (except during major global risk aversion, when the USD / CHF will develop a home market)
Countries leading exports to Switzerland-Main The Swiss import countries —
1. Germany 1. Germany
2. U.S. 2. France
3. France 3. Italy
4. United Kingdom 4. Netherlands
5. Japan 5. United Kingdom
Swiss National Bank (SNB) – Central Bank of Switzerland:
Instead of an interest rate, seeks to establish a target range of interest-the 3-month Swiss Libor.
The central bank 's main objective is to maintain a inflation below 2%
The Swiss interest rates are extremely low.
Repos are the central bank 's policy instrument important.
The Central Bank publishes a quarterly newsletter containing a detailed assessment of the current state of the economy and monetary policy review.
The central bank publishes a monthly bulletin containing a summary of economic developments.
Important Economic Indicators
KoF Main Indicators of the report:
The KoF Leading Indicators Report is published by the Swiss Institute for Business Cycle Research, and is used to measure health future of the economy.
Consisting of 6 parts: 1 – Changes in orders from manufacturers 2 – Expected purchase plans of manufacturers in the next 3 months 3 — Case stocks in the wholesale business 4 – the consumers' perception of their financial conditions 5 – Construction sector lag 6 – The order backlog for manufacturers.
Other indicators:
IPC
GDP
Balance of Payments
Production index (industrial production) – Quarterly report
Retail-Monthly Report
About the Author:
http://www.informedtrades.com/members/tekmnd/
Article Source: ArticlesBase.com – Swiss Franc Fundamentals
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