Fixed income strategies

Carmignac Portfolio EM Debt

Luxembourg SICAV sub-fundEmerging marketsSRI Fund Article 8
Share Class

LU1623763221

Exploit fixed income opportunities across the entire emerging universe
  • Access a wide range of performance drivers across the emerging universe: local debt, external debt and currencies.
  • A conviction-driven and non-benchmarked philosophy to uncover the attractive opportunities emerging markets have to offer.
Key documents
Asset Allocation
Bonds92.2 %
Other7.8 %
Data as of:  30 Sep 2024.
Risk Indicator
3/7
Recommended Minimum Investment Horizon
3 years
Cumulative Performance since launch
+ 40.9 %
0.0 %
+ 26.9 %
+ 9.2 %
+ 9.6 %
From 31/07/2017
To 14/10/2024
Calendar Year Performance 2023
-
-
-
+ 0.8 %
- 10.5 %
+ 28.1 %
+ 9.8 %
+ 3.2 %
- 9.4 %
+ 14.3 %
Net Asset Value
140.87 €
Asset Under Management
231 M €
Market
Emerging markets
SFDR - Fund Classification

Article

8
Data as of:  14 Oct 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. The Sustainable Finance Disclosure Regulation (SFDR) 2019/2088 is a European regulation that requires asset managers to classify their funds as either 'Article 8' funds, which promote environmental and social characteristics, 'Article 9' funds, which make sustainable investments with measurable objectives, or 'Article 6' funds, which do not necessarily have a sustainability objective. For more information please refer to https://eur-lex.europa.eu/eli/reg/2019/2088/oj.

Carmignac Portfolio EM Debt fund performance

Take a look at the Fund's performance supported by our Fund managers’ market commentary and strategy insight.

Our monthly comments

Data as of:  30 Sep 2024.
Fund management team

Abdelak Adjriou

Fund Manager

Alessandra Alecci

Fund Manager

Market environment

  • The Federal Reserve delivered a more accommodating message than expected at its September meeting, cutting its key rate by -0.5%.

  • Growth data nevertheless exceeded expectations across the Atlantic, both in terms of unemployment, which declined to 4.2%, and consumer resilience, with retail sales accelerating by +0.1%.

  • The Indonesian and South African central banks followed the Federal Reserve's lead, announcing rate cuts of 25 basis points, while the Brazilian central bank raised its key rate by 25 basis points.

  • The US dollar's weakness benefited emerging currencies, which appreciated over the month, notably Latin American and Asian currencies.

  • At the end of the period, the Chinese authorities announced a series of measures aimed at countering China’s economic slowdown and boosting market sentiment.

Performance commentary

  • The Fund ended the month with a positive absolute performance, but underperformed its reference indicator.

  • Against a backdrop of monetary easing and the good performance of risky assets, our investments in local and external EM debt both contributed positively to portfolio performance.

  • In local debt, our positions in Mexican local rates made a positive contribution, as well as our exposure to South African and Indonesian rates.

  • On the credit side, our investments in emerging countries' external debt made a positive contribution, benefiting from our allocation to Mexican quasi-sovereign issuer Pemex, and our positions in Egyptian and Argentine debt. On the other hand, our credit market hedges weighed slightly on performance.

  • Finally, on the currency front, we benefited from our exposure to Latin American currencies (Brazilian real, Chilean peso) and Asian currencies (Malaysian ringgit). On the other hand, we suffered from our short positions in the Chinese yuan, which we reduced over the period.

Outlook strategy

  • Against this backdrop of a soft landing for the economies and inflation continuing its gradual decline, we are maintaining a relatively high level of modified duration, at around 6 at the end of the period.

  • Over the period, we increased portfolio's modified duration to emerging local debt, by strengthening our positions in Brazilian local rates, as the markets are still anticipating a large number of rate hikes, which we believe to be exaggerated.

  • We have also strengthened our positions in Indonesian local debt, where the fundamentals remain very favorable, with falling inflation, healthy growth and a low fiscal deficit.

  • On the external debt side, we continue to favor special situations in countries where economies are undergoing significant restructuring or improvement, such as Egypt and Romania. Over the month, we reduced our positions in external high-yield bonds on a profit-taking, after their good performance in previous weeks.

  • On credit, we are maintaining our cautious bias due to high valuations, and are maintaining a substantial level of hedging on Itraxx Xover to protect the portfolio from the risk of widening credit spreads.

  • Finally, we maintain a selective exposure to emerging currencies, with a preference for Latin American currencies and those linked to commodities, which should benefit from the Chinese stimulus. These include the Brazilian real, Chilean peso, Indonesian rupiah and South African rand.

Performance Overview

Data as of:  14 Oct 2024.
​Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). Until 31/12/2023, the reference indicator was JP Morgan GBI – Emerging Markets Global Diversified Composite Unhedged EUR Index (JGENVUEG). Performances are presented using the chaining method.Morningstar Rating™ :  © Morningstar, Inc. All Rights Reserved. The information contained herein: is proprietary to Morningstar and/or its content providers; may not be copied or distributed; and is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.The return may increase or decrease as a result of currency fluctuations, for the shares which are not currency-hedged.
Source: Carmignac at 16/10/2024

Carmignac Portfolio EM Debt Portfolio overview

Below is an overview of the composition of the portfolio.

Geographical Breakdown

Data as of:  30 Sep 2024.
Latin America31.6 %
Eastern Europe28.5 %
Africa19.7 %
Asia9.7 %
Middle East6.5 %
Europe4.1 %
Total % of bonds100.0 %
Latin America31.6 %
mxMexico
12.2 %
Brésil
5.0 %
coColombia
4.8 %
Pérou
3.6 %
arArgentina
2.7 %
Ecuador
1.6 %
République Dominicaine
1.4 %
clChile
0.3 %
crCosta Rica
0.1 %

Key figures

Below are the key figures for the Fund, which will give you a clearer idea of the Fund's management and bond positioning.

Exposure Data

Data as of:  30 Sep 2024.
Modified Duration5.8
Yield to Maturity7.1 %
Average Coupon5.7 %
Number of Issuers56
Number of Bonds85
Average RatingBB+
Yield to Maturity (YTM) is the estimated annual rate of return expected on a bond if held until maturity and assuming all payments made as scheduled and reinvested at this rate. For perpetual bonds, the next call date is used for computation. Note that the yield shown does not take into account the FX carry and fees and expenses of the portfolio. The portfolio’s YTM is the weighted average individual bonds holdings' YTMs within the portfolio.

The strategy in a nutshell

Discover the Fund’s main features and benefits through the words of the Fund Managers.
Fund Management Team

Abdelak Adjriou

Fund Manager

Alessandra Alecci

Fund Manager
The Fund is best suited for fixed income investors looking for higher returns than those offered by developed markets, by taking advantage of the emerging universe potential.

Abdelak Adjriou

Fund Manager
View Fund's characteristics
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.