Opportunities beyond Swiss bonds: Global credit for Swiss investors | Insight Investment

Swiss investors have historically benefited from a strong domestic bond market, but today's environment presents a very different challenge. With Swiss bond yields among the lowest in global fixed income markets, investors seeking income, diversification and long-term return potential may increasingly need to look beyond the domestic market. This paper explores why a globally diversified credit strategy, hedged back into Swiss francs, may offer a compelling alternative to a traditional Swiss bond allocation.

Global credit investing for Swiss investors

Global credit markets provide access to a significantly broader investment universe than the Swiss franc-denominated bond market, encompassing thousands of issuers across sectors, regions and economic cycles. By investing globally while hedging currency exposure back into Swiss francs, investors can retain Swiss-franc stability while accessing higher-yielding opportunities and a wider range of potential return drivers.

This paper examines how global investment-grade corporate bonds can help Swiss investors improve portfolio diversification, access higher income potential, and reduce reliance on a relatively concentrated domestic market. It also explores how active bond management can seek additional value through security selection, sector allocation, duration positioning, relative-value opportunities and credit research.

Why the future may be different for Swiss bonds

A key challenge for investors is that historical performance may not be a reliable guide to future returns. Swiss bonds have benefited from a unique combination of low interest rates, strong demand for safe-haven assets and favourable market conditions. While this has rewarded home bias in the past, the same conditions may not persist over the coming decade.

At the same time, global credit markets continue to evolve. Emerging themes such as AI infrastructure financing, investment in power networks and data centres, and potential growth in European securitisation markets are creating new opportunities that are largely absent from domestic Swiss bond indices. Global investors are better positioned to access these developments as they reshape fixed income markets.

Key questions addressed in this paper

Are Swiss bonds still attractive relative to global fixed income markets?

What are the benefits of global credit investing for Swiss investors?

How can currency-hedged bond strategies preserve Swiss-franc exposure?

Why is active management important in corporate bond markets?

What opportunities are emerging from AI-driven investment and European securitisation reform?

How can investors balance income, diversification and risk in today's low-yield environment?

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Opportunities beyond Swiss bonds: Global credit for Swiss investors examines the investment case for moving beyond domestic fixed income markets and considers how a globally diversified, actively managed credit strategy may help investors build more resilient portfolios in the years ahead.