Why was Switzerland neutral during World War 2?

Answer 1

Despite what many people think about Switzerland it wasn't secretly on the side of the Nazis. The Swiss Nazi party was tiny and most Swiss people opposed the Third Reich because of their multicultural heritage, and direct democracy which was and still is a big part of Swiss nationhood. The country was under constant threat of invasion from Nazi Germany, but it was ready to mobilize every man with a gun and fight a guerrilla war to stop the Nazis. Thing is, they would've done it to the allies too if they invaded also.
Switzerland assisted Germany somewhat until near the end of the war, however Switzerland has a fairly long history of remaining neutral during European conflicts. During the Second World War, it was not in Switzerland's interests to opening ally herself with either the Allies or Axis.

In mid-1940 after France was defeated by Germany & Italy, Switzerland was totally surrounded by the Axis Powers. There was no possibility of the Allies lending assistance to Switzerland if she chose to ally herself with them. Switzerland wisely decided not to openly ally herself with Hitler. By 1941, Switzerland had no borders with any Axis enemies. Switzerland had important business & financial ties to numerous nations of both the Allies & Axis, and these remained the primary source of Switzerland economic health.