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Carmignac ups equities to near max level

Carmignac ups equities to near max level

French group Carmignac Gestion has increased its equity exposure across three of its most popular funds to their near maximum permitted levels.

In its latest investor note, the Paris-based group’s Didier Saint-Georges, its spokesperson and investment committee member, said that equity markets had experienced a sharp upturn during the month of September following the delay in the Fed’s tapering program and positive market indicators in Europe and China.

‘Our holdings in domestic stocks with strong growth potential such as the Macau casinos (Wynn Macau) as well as the leading companies exposed to global growth have benefited from this move, particularly since we strengthened our equity exposures over the month [September] bringing them close to their maximum authorised levels.’

The €23.7 billion global mixed asset Carmignac Patrimoine fund, managed by Edouard Carmignac and Rose Ouahba, now has a 50% equity exposure, while its €1.1 billion emerging market version Carmignac Emerging Patrimoine, run by Simon Pickard, Charles Zerah and Frédéric Leroux, stands at 48%.

The firm’s €6.7 billion global equity Carmignac Investissement fund, managed solely by Edouard Carmignac, is now at its maximum investment level.

This rise follows a tactical move during the summer by the French firm to drop Carmignac Patrimoine’s equity exposure from 42% in July to 24% in August, which was detailed in the firm's August investor note.

A spokesperson then told Citywire Global the drop in the €24 billion fund’s equity exposure was a tactical move to protect the fund against macro risks such as the Syrian conflict and the US budget debate. By the start of September it was back up to around 43%.

Dollar bets

The firm also made some changes to its US dollar exposure during the summer. While its biggest funds, Patrimoine and the Investissement funds, have retained their overweight to the green bill, they have taken some profits and reduced their exposure.

When the US dollar ended the month of August slightly higher than the euro after benefiting from its safe haven status, the firm took this opportunity to reduce its exposure to the US dollar.

By the end of August the Patrimoine fund’s US dollar exposure was at 43% - down from 67% in July’s factsheet – and Investissement’s was 64.9% - down from 78.5% in July.

In its latest investor note for September, Saint-Georges said they have removed the hedges they had on the US dollar and on certain emerging currencies following the delay in the QE tapering initiative and the rise in interest rates in countries like Brazil and India.

‘Our currency exposure is now balanced with Carmignac Patrimoine having a 38% exposure to the euro and a 42% exposure to the US dollar.’

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