Urban studies: Doing research when every city is different 
European Stocks Rally on Chinese Growth and Mining Merger Speculation 
Global Markets React to Strong U.S. Jobs Data and Rising Yields 
Stock Futures Dip as Investors Await Key Payrolls Data 
UBS Predicts Potential Fed Rate Cut Amid Strong US Economic Data 
China's Refining Industry Faces Major Shakeup Amid Challenges 
China’s Growth Faces Structural Challenges Amid Doubts Over Data 
U.S. Stocks vs. Bonds: Are Diverging Valuations Signaling a Shift? 
Wall Street Analysts Weigh in on Latest NFP Data 
UBS Projects Mixed Market Outlook for 2025 Amid Trump Policy Uncertainty 
2025 Market Outlook: Key January Events to Watch 
US Futures Rise as Investors Eye Earnings, Inflation Data, and Wildfire Impacts 
Mexico's Undervalued Equity Market Offers Long-Term Investment Potential 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
Lithium Market Poised for Recovery Amid Supply Cuts and Rising Demand 
Oil Prices Dip Slightly Amid Focus on Russian Sanctions and U.S. Inflation Data 
US Gas Market Poised for Supercycle: Bernstein Analysts 
Long CHFJPY has been our top strategic pick for 2020 premised on the substantial difference in the underlying balance of payments position between the two countries.
The bottom line is that Japan neutralises all of its current account surplus through outflows of long-term equity & FDI whereas Switzerland recycles only one-half in this manner (refer above chart).
In other words, Switzerland needs to generate substantially greater outflows of short-term capital than Japan. This not only biases CHF higher vs JPY on a trend basis, but also means that CHF could potentially hold its own versus JPY in risk-off environment. It’s fair to say that the thesis that CHF could prove more anti-cyclical than JPY has not yet been established (CHJFJPY has dipped a 1.5% in the last two weeks), so to be on the safe side we are buying JPY vs one of the most cyclical European currencies, SEK, to neutralise the possibility that we are could inadvertently find ourselves on the wrong side of a deeper shake-out in risk.
For now, therefore, while we are still short CHFJPY spot and are short CHF-JPY correlation through a dual AED, the net spot position now converts to long CHFSEK.
This off course is highly sensitive to growth and is well-placed to capitalise on a more substantive re- think of the regional and global economic outlook.
Sell SEKJPY at 11.268, stop at 11.493.
Long CHFJPY from 113.45 on Jan 14th. Marked at -0.83%.
Stay long a 2-month dual at-expiry digital (USDCHF < 0.9625 & USDJPY > 110.70). Bought at 10.5%. Marked at 2.52%. Courtesy: JPM
