A Note on Currency Hedging of Dollar Investments of Swiss Investors 1974-2025

Peter Kugler

Working papers from Faculty of Business and Economics - University of Basel

Abstract: Our econometric (cointegration) analysis of the Swiss franc US dollar exchange rates over the period 1974 – 2025 provides strong evidence for a negative bias of the forward rate as predictor of the spot rate for the years up to 2007, which disappears with data from 2008 onwards. This implies that hedging increased the expected Swiss franc value of dollar investments before 2008. This advantage of hedging disappeared in the last 15 to 20 years and hedged and unhedged dollar investment have the same franc expected value in the long run.

JEL-codes: E43 E44 G15 (search for similar items in EconPapers)
Date: 2026-04-21
New Economics Papers: this item is included in nep-his, nep-ifn and nep-mon
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Persistent link: https://EconPapers.repec.org/RePEc:bsl:wpaper:2026/02

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