These are also extraordinary times in currency markets and extreme measures and volatility are to be expected.
I've been bearish on CHF since July, took a touch of drawdown and didn't make anywhere near as much money as I could have if I had been patient upon my choice of entry, as ever, but not anymore. Personally, I applaud the SNB because this decision has taught myself the final piece of the price action jigsaw. Thankyou Big speculators
The Swiss government has basically told the world that they will print as much money as it takes, and buy up as much crap sovereign debt as they can, to competitively devalue the currency. This essentially puts Switzerland in the same sinking boat as Italy, Greece, and Portugal… with one key difference: Switzerland has 0% interest rates. In other words, you can now borrow in francs at 0% and buy government-backed euro garbage yielding 5%, 10%, 30%…. with absolutely no downside currency risk. http://www.zerohedge.com/news/guest-post-immediate-effect
wow i just noticed the huge move on the EUR.USD i was so lucky that i was sleeping at the moment so i didnt get out of my shorts! so the eur.usd moved and came all the way back...but the eur.chf stayed at 1.2, and so did the usd.chf So...why did the EUR.USD make that move again?
How do you come to that conclusion? They don't even have the same currency... Are you saying this because of the gvmt backed bonds?
That is if you believe the policy of a bank that failed to tell you that they intended to set a 1.2 base exchange rate against the EUR, before it happened. It's to obvious for my liking. I'd much rather have been told about that intended change yesterday... I could now be sipping cocktails with Martinghoul.
Assuming they maintain the level. According to their website: The Swiss National Bank is constituted as a special statute joint-stock company. The rights of the shareholders are embodied in the National Bank ActNational Bank Act (PDF); company law is applied merely complementarily (art. 2 NBA). The share capital of the Swiss National Bank amounts to CHF 25 million. It is divided into 100,000 registered shares with a nominal value of CHF 250 each. The shares are fully paid up (art. 25 para.1 NBA). A dividend not exceeding 6% of the share capital is paid from the net profit (art. 31 para. 1 NBA). The SNB share is listed in the main segment of the Swiss stock exchange (SWX). Symbol/ISIN: SNBN / CH0001319265 Movements in the price of the SNB share resembles those of risk-free long-term bonds rather than shares (as the dividend is limited to 6% of the share capital by law). If that's the case don't they have to be cognizant of the size of the euro reserves they add and their effect on the banks equity? Maybe someone more familiar with the SNB can fill us in.
they will only make profit. as long as they buy at 1.20 and do not let it go lower the trade always shows profit. also note that today they made a killing by trading for 3 hours at around 1.10 before issuing the statement. smart guys.