An annual long-term study indicates a favorable trend in Swiss equities and bonds. The analysis highlights the average nominal annual returns for bonds and equities, showcasing the potential benefits of a balanced investment approach.

Since 1926, bonds have achieved an average return of 4.0 percent, while equities have performed even better with an average return of 7.7 percent. A balanced portfolio consisting of 60 percent equities and 40 percent bonds would have yielded an average return of 6.6 percent. The advantages of extended holding periods are evident, as investments in Swiss equities have produced positive returns in:

• 85 of the last 99 years over five years
• 96 out of 99 years over ten years

In 2024, Swiss bonds experienced a nominal yield of 5.3 percent, a decrease from 7.4 percent in 2023. This decline was influenced by weaker growth prospects and strong disinflation affecting interest rates. The Swiss Bond aaa-bbb Total Return Index outperformed foreign currency equivalents, offering an inflation-adjusted yield of 4.7 percent. Meanwhile, the Swiss Performance Index (SPI) achieved a return of 6.2 percent in 2024, closely aligning with the previous year’s return of 6.1 percent, yet falling short of the long-term geometric average of 7.7 percent since 1926. It is noteworthy that Swiss bonds experienced their worst performance in 2022, with a decline of 12.1 percent.

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