Calendar Year Performance 2014Calendar Year Performance 2015Calendar Year Performance 2016Calendar Year Performance 2017Calendar Year Performance 2018Calendar Year Performance 2019Calendar Year Performance 2020Calendar Year Performance 2021Calendar Year Performance 2022Calendar Year Performance 2023
+ 13.8 %
+ 3.3 %
+ 9.5 %
+ 0.1 %
- 3.7 %
+ 8.4 %
+ 4.7 %
+ 0.1 %
- 5.6 %
+ 3.0 %
Net Asset Value
1481.2 €
Asset Under Management
730 M €
Market
Global market
SFDR - Fund Classification
Article
8
Data as of: 29 Feb 2024.
Data as of: 18 Mar 2024.
Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). The return may increase or decrease as a result of currency fluctuations, for the shares which are not currency-hedged.
February was a turning point for the disinflation trend that had been shoring up the markets over previous months. Growth figures brought more pleasant surprises on both sides of the Atlantic, but the (dis)inflation trend disappointed investors. While credit indices continued to benefit from growth being stronger than anticipated, sovereign assets performed much less glowingly, with traders forced to lower their expectations of central bank rate cuts in 2024. In the United States, leading and lagging indicators seem to be converging towards a single benign growth scenario. Both the manufacturing and service components of PMIs improved, and consumer confidence picked up further in February, showing businesses’ and households’ shared enthusiasm about the economic outlook. This US economic exceptionalism results from the knock-on effects of a growing labour market, on which job reports were surprisingly positive once again. However, this frenetic growth seems to impinge on the immaculate disinflation scenario that had been underpinning risk appetite. While headline inflation continues to benefit from the sharp drop in commodity prices, core inflation disappointed investors, sticking at +3.9% y/y, while the services price index rebounded to +5.4% y/y. The US Federal Reserve chair therefore took a less dovish than expected tone, driving up yields. The 10-year Treasury yield gained 34 bps over the month, reversing last December’s bond rally. Albeit to a lesser extent, the Eurozone also showed signs of progress with leading indicators still rebounding as the services sector expands. Inflation slowed by less than expected due to the robust services component of core inflation. While wage growth seems to have peaked, the figure of +4.5% y/y remains well above the European Central Bank’s inflation target. This combination of firmer growth and stickier inflation led to the 10-year Bund yield gaining 25 bps, while risky assets made further progress as high yield spreads narrowed by 23 bps. Japan’s complacent monetary policy seems even more likely to end with the publication of higher-than-expected core inflation, above the 2% mark for the 11th month in a row.
Performance commentary
The Fund delivered a slightly negative monthly performance, though beat its reference indicator. Our corporate bond selection continued to generate a steady, positive return as spreads narrowed. Our external debt holdings also raised performance considerably, especially in Africa. Our long position on Egypt was particularly profitable following the IMF’s various comments on the funds that it will be disbursing. However, our credit hedging proved costly, reducing our gains. We are nonetheless keeping a high level of protection given that corporate bond spreads are barely 50 bps away from their all-time lows. Our relatively low modified duration also made a big difference to the lead over our reference indicator. We kept our overall modified duration at a prudent level throughout February (around 3.7 at month-end).
Outlook strategy
We are remaining cautious and had reduced the Fund’s modified duration to around 3.7 by month-end. There are basically three reasons for our approach: we remain optimistic for US real yields given how high they are; we are long on the local debt of emerging markets where real yields are high and a rate-cutting cycle is underway, such as Brazil; and we are feeling positive about undervalued currencies that are benefitting from solid economic trends, such as demand for commodities, and out-of-synch cycles. We are also taking a selective approach to special government bond cases (external debt) in the high yield segment, where risk is well rewarded. We are therefore keeping a certain amount of credit hedging. At a foreign exchange level, our dollar exposure remained neutral at around 27%. Another 6% is held in the Japanese yen. We have a positive outlook for some emerging markets and commodity-based currencies, including the Brazilian real, and certain Asian currencies such as the won, as the South Korean economy should benefit from the AI boom. As far as developed market currencies go, we are also long on the Norwegian krone.
Reference to certain securities and financial instruments is for illustrative purposes to highlight stocks that are or have been included in the portfolios of funds in the Carmignac range. This is not intended to promote direct investment in those instruments, nor does it constitute investment advice. The Management Company is not subject to prohibition on trading in these instruments prior to issuing any communication. The portfolios of Carmignac funds may change without previous notice.
The reference to a ranking or prize, is no guarantee of the future results of the UCIS or the manager.
Carmignac Portfolio is a sub-fund of Carmignac Portfolio SICAV, an investment company under Luxembourg law, conforming to the UCITS Directive.
The information presented above is not contractually binding and does not constitute investment advice. Past performance is not a reliable indicator of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor), where applicable. Investors may lose some or all of their capital, as the capital in the UCI is not guaranteed. Access to the products and services presented herein may be restricted for some individuals or countries. Taxation depends on the situation of the individual. The risks, fees and recommended investment period for the UCI presented are detailed in the KIDs (key information documents) and prospectuses available on this website. The KID must be made available to the subscriber prior to purchase.). The reference to a ranking or prize, is no guarantee of the future results of the UCITS or the manager.
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Market environment
February was a turning point for the disinflation trend that had been shoring up the markets over previous months. Growth figures brought more pleasant surprises on both sides of the Atlantic, but the (dis)inflation trend disappointed investors. While credit indices continued to benefit from growth being stronger than anticipated, sovereign assets performed much less glowingly, with traders forced to lower their expectations of central bank rate cuts in 2024. In the United States, leading and lagging indicators seem to be converging towards a single benign growth scenario. Both the manufacturing and service components of PMIs improved, and consumer confidence picked up further in February, showing businesses’ and households’ shared enthusiasm about the economic outlook. This US economic exceptionalism results from the knock-on effects of a growing labour market, on which job reports were surprisingly positive once again. However, this frenetic growth seems to impinge on the immaculate disinflation scenario that had been underpinning risk appetite. While headline inflation continues to benefit from the sharp drop in commodity prices, core inflation disappointed investors, sticking at +3.9% y/y, while the services price index rebounded to +5.4% y/y. The US Federal Reserve chair therefore took a less dovish than expected tone, driving up yields. The 10-year Treasury yield gained 34 bps over the month, reversing last December’s bond rally. Albeit to a lesser extent, the Eurozone also showed signs of progress with leading indicators still rebounding as the services sector expands. Inflation slowed by less than expected due to the robust services component of core inflation. While wage growth seems to have peaked, the figure of +4.5% y/y remains well above the European Central Bank’s inflation target. This combination of firmer growth and stickier inflation led to the 10-year Bund yield gaining 25 bps, while risky assets made further progress as high yield spreads narrowed by 23 bps. Japan’s complacent monetary policy seems even more likely to end with the publication of higher-than-expected core inflation, above the 2% mark for the 11th month in a row.