Case Study: The Swiss Franc Shock of 2015, A Forex Black Swan Event

On 15 January 2015, the Swiss National Bank scrapped the 1.20 floor it had held under EUR/CHF for more than three years, without warning and three days after a senior official had called it a cornerstone of policy. The franc jumped by double digits within minutes, liquidity disappeared, stop-losses filled hundreds of pips away, retail brokers were left with client negative balances they could not recover, and at least one hedge fund was nearly wiped out. This case study rebuilds why Switzerland capped its own currency, how the market came to treat the floor as a free option, what actually happened in the minutes after the announcement, and who was hurt and why. It then turns the event into a risk framework for HNI, family office and active currency traders: measuring tail risk that VaR misses, sizing positions to survive a gap, judging broker and counterparty risk, and reading the RBI's management of the rupee, NSE and BSE currency derivatives and offshore LRS holdings through the lens of a peg that broke.