High performance with tamed risk

Stefano Gianti
Published in
7 min readDec 28, 2021


Creating value in the double-digit percentage range while simultaneously keeping fluctuations in value under control is a difficult exercise. We show you how to find these hidden gems and the products on Swiss DOTS you can use to implement them.

Investing in cryptocurrencies such as Bitcoin is a hot topic right now. Yet at the same time, the significant volatility of these instruments deters many from making an investment. With the help of suitable leveraged products on Swiss DOTS and by choosing the underlying products carefully, investors can achieve similar performance to Bitcoin with lower levels of risk.

The Swiss DOTS platform offers you access to a wide selection of leverage products with various underlying products, such as international and Swiss equities, currency pairs, indexes or even precious metals.

As a first step, investors should be on the lookout for attractive, defensive securities characterised by minimal price fluctuations. Generally speaking, defensive companies engage in business activities that are less sensitive to cyclical fluctuations. Typical examples include food multinational Nestlé and pharmaceutical company Novartis.

Where are low-volatility securities hiding?

Historic volatility is a simple tool that can be used when looking for these hidden gems. The lower it is, the lower fluctuations were in the past. Table 1 lists the 60-day volatilities of SMI securities as of 5 November as well as the highest and lowest 60-day volatilities over the past 12 months. Unsurprisingly, the SMI, which includes all 20 securities, has the lowest volatility at 10.5%. What’s more, the range between the extremes is relatively narrow with a minimum of 8.4% and a maximum of 16.7%. Of the individual securities, SGS Surveillance, Zurich Insurance, Nestlé and Novartis showed the lowest volatility as of the reporting date. These, combined with a knock-out warrant with leverage of 3 to 5, are best suited for achieving above-average performance comparable to that of crypto investments such as Bitcoin, Ethereum, etc. Securities such as Richemont, Alcon, Credit Suisse or Logitech are less suitable as they are usually subject to considerable fluctuations.

Historic volatility of SMI securities as of 5 November 2021 (60-day) // Source: Infront

Which leveraged products should be considered for upgrading the performance of more defensive securities?

Mini-futures, factor certificates and knock-out warrants are particularly suitable for this purpose due to their volatility neutrality. The leverage on these products should not be too high to limit the risk that they will be knocked out. Potential candidates can be recorded on the Swissquote website.

Selection of knock-out warrants on Zurich Insurance (26 November 2021, 38 products) // Source: Swissquote

Taking the example of knock-out warrant SG4JVO (57942754) on Zurich Insurance compared to Bitcoin, it is clear that the leveraged product’s performance is comparable to that of the crypto investment.

Comparison of KO warrant SG4JVO with Bitcoin (USD) and Zurich Insurance // Source: Infront

Another example is knock-out warrant CBPLWD (53899238) on Nestlé. This warrant also has no problem keeping pace with Bitcoin.

Comparison of KO warrant CBPLWD with Bitcoin (USD) and Nestlé // Source: Infront

Despite the low volatility of Zurich Insurance and Nestlé, the fluctuations in both leveraged products were similar to those recorded by Bitcoin.

In order to reduce risk while achieving comparable performance, the price trend of the underlying must not only exhibit low volatility but must also develop with as few significant changes in direction as possible. The price development of the S&P 500 index since May 2020 is a prime example of this kind of wishful thinking. This benefited the knock-out call warrant CBUKRN (54475483), which achieved an increase in value comparable to Bitcoin with significantly lower fluctuations.

Chart 3: Comparison of KO warrant CBUKRN with Bitcoin and the S&P 500 index // Source: Infront

With the help of volatility-neutral leveraged products, it is possible to create value in the double-digit percentage range while simultaneously keeping value fluctuations under control. To achieve this, the security underlying the leveraged product must exhibit low volatility and follow as stable a trend as possible. If both of these factors apply, things can really take off without fraying investors’ nerves.

Back to the future

There will be a number of opportunities to put all this into practice over the coming weeks.

On Swiss DOTS, leveraged products on the SMI such as knock-out call warrant CBWW8D (53899785) offer excellent opportunities to achieve performance similar to crypto investments with lower fluctuations.

Leveraged products on Novartis, such as knock-out call warrant CB57DZ (48431561), could also be promising. After the sale of its stake in Roche, there is reason to hope that a little imagination is finally returning to the pharmaceutical group.

In Europe, Total Energies is among the underlying securities with low volatility, steady growth and excellent prospects. These can be implemented using the knock-out call warrant SG0GMK (58285203). Knock-out call warrant SGDDK6 (56493687) on Bayer is also tempting, as the German group seems to be initiating a turnaround. Glencore also appears to be experiencing a continuous upward trend, and there is strong evidence that this positive trend will continue. Investors can achieve above-average profits from this development with knock-out call warrant SGXRIA (110133157).

Gold exhibits relatively low volatility when it comes to commodities. After an extended correction phase, the yellow metal appears to be on the brink of an upward surge. Knock-out warrants such as CB8457 (48547626) should be able to keep pace with Bitcoin easily over the coming weeks and with fewer fluctuations. Knock-out call warrants such as SGVHUM (59103277) on Brent Oil are also worth considering. Although crude oil is slightly more volatile than gold, it is already experiencing an upward trend. Several experts expect prices to rise to over 100 USD per barrel in the medium term.

The essentials in a nutshell

With the right low-volatility underlying products and a suitable leveraged product on Swiss DOTS, you can achieve similar performance to crypto investments with lower price fluctuations!

The Swiss DOTS platform offers you access to a wide selection of leverage products with various underlying products, such as international and Swiss equities, currency pairs, indexes or even precious metals.

At the same time you can benefit from particularly long trading times — from 8:00 to 22:00 — and various order options.

Swiss DOTS products can be traded at a flat rate from just CHF 9.- .

Go to Swiss DOTS products


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All investments carry a degree of risk.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74–89 % of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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Stefano Gianti

Education Manager at Swissquote, Member of SIAT_Italia (the Italian Society of Technical Analysts) and IFTA (International Federation of Technical Analysts).