Swiss shares or the world: what home bias brings, and what it costs

Switzerland is a few percent of the world stock market, but often a much bigger share of a Swiss-based investor's equities. That choice has real advantages. It also has a less visible cost: three companies make up almost half the SMI.

Published 21 October 2026 · MSCI and iShares data to end of September 2026 · 6 min read

Key points

Switzerland is a few percent of the world stock market; the United States, almost three quarters.
The SMI is highly concentrated: Roche, Novartis and Nestlé make up almost half the index.
Swiss shares avoid currency risk and their withholding tax is recoverable, but on their own they do not diversify.

Switzerland's real place

In the global equity index, Switzerland is a few percent, less than France; the United States, almost three quarters. Yet many Swiss-based investors hold far more, often without having decided it: through their bank, their 3a or out of habit. Some 3a strategies place almost 40% of their equities in Switzerland. That is what is called home bias.

The SMI: three stocks make up almost half

Roche, Novartis and Nestlé account for almost half the SMI, and health care for more than 40% of the index. Technology weighs less than 1%, while it is the largest sector of the world stock market. The index rules even cap each stock at 18%, precisely to limit that concentration.

The largest SMI positions, at end of September 2026

Roche

16.7%

Novartis

15.6%

Nestlé

13.4%

ABB

8.4%

UBS

8.4%

Source: BlackRock, iShares SMI ETF factsheet at 30.09.2026. The SMI has 20 stocks; the top 10 make up 83%.

What home bias brings

Swiss shares have three real advantages for an investor who lives in francs.

No currency risk: your dividends and capital are in francs, like your spending.
Recoverable withholding tax: the 35% withheld on Swiss dividends is given back through your tax return, while part of the tax withheld abroad is lost.
Solid, global companies: a large part of their sales is made outside Switzerland.

What it costs

The cost of home bias is concentration: your savings depend on a few companies and two or three sectors. Depending on the period, that has helped or hurt. From 2016 to 2025, the SMI returned about 7.6% a year, and global equities about 10% a year in francs, driven by American technology. In the 2000s, by contrast, the dollar lost about a third of its value in francs, which weighed heavily on global equities for a Swiss-based investor.

Nobody knows which decade comes next. Diversification exists precisely so you do not depend on the answer.

How to size it

Measure your current Swiss share: add up your Swiss shares in your brokerage account, your 3a and your bank's funds.
Decide it rather than drift into it: a moderate Swiss share brings its advantages without depending on three stocks.
Check your 3a: some 3a strategies place almost 40% of their equities in Switzerland. A more global version often exists at the same provider.

Going further

Your wealth is already very Swiss. Salary, pension fund, home and savings account are in francs and tied to the Swiss economy. Your equities are the simplest place to diversify the rest.

Expats: think about where you will retire. If you plan to retire in your home country, your future spending will be in another currency: a large Swiss share is then a currency bet too.

Currency is a separate topic. Investing globally means accepting the dollar: what that has cost, and when to hedge, is in the strong franc and currency risk.

Your split over 25 yearsEquities, bonds and cash: 1'500 simulated paths.

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Your next step

To do, at your own pace:

Measure your Swiss share: brokerage account, 3a and bank funds.
Decide that share instead of drifting into it, and write it down.
Check the Swiss share of your 3a strategy.

Path “Investing: the right decisions” · step 2 of 6

Step 3: The strong franc → See the path

Frequently asked questions

What share of the world stock market is Switzerland?

Only a few percent. In the MSCI World index, the United States weighs almost 73% and Switzerland less than France, the fifth country with about 2.2% (end of September 2026).

Is the SMI diversified?

Not much. Roche, Novartis and Nestlé make up almost half the index, and health care more than 40%. Technology weighs less than 1%. Each stock is capped at 18%, precisely to limit that concentration.

Why do so many Swiss investors overweight Switzerland?

No currency risk, familiar companies, and a 35% withholding tax on Swiss dividends that a resident fully recovers. These advantages are real, but they do not make up for being concentrated in a few stocks.

Have Swiss shares done better or worse?

It depends on the period. From 2016 to 2025, the SMI returned about 7.6% a year and global equities about 10% a year in francs. In the 2000s, the dollar lost about a third of its value in francs, which sharply reduced the return of global equities for a Swiss-based investor.

I will retire outside Switzerland. Does that change the answer?

Yes. If your future spending will be in euros, pounds or dollars, a large Swiss share becomes a currency bet in itself. Your home market and the world market matter more for you than for someone who will retire in Switzerland.

Sources: MSCI, MSCI World index factsheet at 30.09.2026 (country weights, annual returns) ; BlackRock, iShares SMI ETF (CH) factsheet at 30.09.2026 (top holdings, sectors, 18% cap, annual index returns) ; SNB, exchange rates ; finpension, 3a Durable 60 strategy factsheet (30.09.2026) ; VStG / LIA (withholding tax). ViaVest calculations of the global return in francs.