The Swiss Helvetia Fund, Inc. is traded on the New York Stock Exchange, under the symbol SWZ. It was launched in August 1987 and invests solely in Swiss companies. Switzerland is a very small country with a global outlook. The bulk of the companies SWZ invests in are truly global giants. Investing in SWZ gives investors the opportunity to invest globally from a Swiss perspective.
SWZ is managed by Banque Hottinger, which is a distinguished old Swiss private bank, catering to affluent global investors. the bank was formed at the time of the French revolution to protect the funds of the fleeing French nobility. Over the centuries Banque Hottinger has involved into a global investment management firm with a global outlook. Investing in SWZ gives you access to the investment advice of this truly global investment management firm.
Performance last year, with the Swiss Franc having appreciated 0.32% against the dollar, was as follows:
|Net Asset value||(11.43%)|
|S & P 500||02.11%|
|Lipper European Fund Index (10 Largest)||(11.00%)|
|Lipper European Fund Universe Average||(13.15%)|
SWZ's cumulative performance from 12/31/96 to 12/31/11 against other Swiss indexes has been as follows:
|Swiss Helveta Fund||92.29%|
|Swiss Performance Index||112.72%|
|Swiss Market Index||50.56%|
|CS EF(CH) Swiss Blue Chips||60.30%|
|UBS Equity Fund||65.29%|
|Pictet Swiss Equities||79.41%|
|Bank Sarasin Index||52.48%|
Although SWZ has a broad portfolio, it is not diversified or wide. SWZ uses a rifle rather than a shotgun. Its ten largest holdings are as follows:
|Swiss Reinsurance (OTC:SWCEY)||2.24%|
|Zurich Financial (ZFSVY.PK)||5.19%|
|Zurmont Madison Private Equity||2.69%|
|Swatch Group (SWGAY.PK)||1.99%|
|Compagnie Financiere Richemont (OTCPK:CFRUY)||3.61%|
These ten holdings constitute 73.85% of all assets, with the top three (3) being 53.53% of assets. It is a very focused fund and not a closet index fund.
As of December 31, 2011, SWZ had net assets of $343,864,236, of which 6.73% were borrowed funds used as leverage. It also had 3.36% of its assets invested in private equity limited partnerships.
SWZ has done well over the years with $ 74,159,926 in net unrealized appreciation.
Fund ratios for the past five (5) years have been as follows:
|Net Expenses||Net Investment Income||Portfolio Turnover|
As of March 6, 2011, SWZ traded at a 9.48% discount from net asset value. It had previously been trading at a discount in the low teens. This is because management has elected to tender for up to 5% of the outstanding shares at a discount of only 2% whenever SWZ traded at a discount above 10% for a period of time. They did conduct one tender offer in 2011. I do not believe in these mini tender offers, and think it is a way for closed end funds to cannibalize themselves over time.
I truly like SWZ and recommend it as a part of everyone's portfolio. You get the Swiss perspective to global investing, with the benefit of a long established global money manager. I suspect that private clients of Banque Hottinger are paying more in fees than what is charged SWZ. As usual, I would look for discounts in net asset value in excess of 10% before investing.