SNB Raised Bets on US Tech Stocks in Q1, 2020

Hit by the coronavirus pandemic, Swiss National Bank(SNB) lost US$39.34 billion in Q1, 2020, the heaviest quarterly loss since its establishment in 1907.

SNB‘s report released last month showed that in the past 5 years, the value of US stocks held by the bank more than tripled from US$26.7 billion in December, 2014 to US$97.5 billion in December, 2019. The stock market plunged over 30% after reaching a historical high in Q1, 2020, but compared with Q4 last year, the total value of SNB’s stock assets didnt shrink too much in Q1, 2020, as the bank had made the right bet.

During the stock market crash, SNB increased stepped up US stock holdings by around 22%, particularly favoring stocks of the technology sector. SNBs latest SEC Form 13F shows that as of March 31st, the bank owns US$4.5 billion of stocks from Microsoft, 4.4 billion from Apple, 3.2 billion from Amazon, 1.6 from Google and 2.7 billion from Facebook.

The 5 technology giants account for over 20% in S&P 500 Index, and they have gained over 10% year to date while the rest of the market slumped 13%. In a time when even Warren Buffet is selling stock assets and shunning risks, SNB, though inevitably suffering significant losses, has managed to avoid systematic breakdown by betting wisely on technology stocks.