Carmignac Portfolio Sécurité: Letter from the Fund Managers - Q4 2025

Author(s)

Published on

14 January 2026

Read time

4 minute(s) read

+0.17%

Carmignac Portfolio Sécurité’s performance in the 4^th quarter of 2025 vs +0.43% for its reference indicator¹ (FW EUR Acc Share class).

+2.64%

Carmignac Portfolio Sécurité’s Performance in 2025 vs +2.28% for its reference indicator (FW EUR Acc Share class).

+8.61%

Carmignac Portfolio Sécurité’s Performance over 2-year vs +5.51% for its reference indicator (FW EUR Acc Share class).

In the fourth quarter of 2025, Carmignac Portfolio Sécurité posted a performance of +0.17%, compared with +0.43% for its reference indicator, bringing full-year performance to 2.64% versus 2.28% for the reference indicator.

Market review and portfolio allocation

2025 was a year dominated by politics, fiscal shocks and central bank pivots, with the return of Donald Trump to the White House acting as the main catalyst for volatility across global fixed income markets.

The year opened with a sharp bond sell-off. Strong US activity data in January, notably a robust December jobs report, pushed the 10-year Treasury yield to a yearly high near 4.8% as markets reassessed the timing of Federal Reserve easing. However, inflation data quickly softened fears of renewed overheating, and expectations of rate cuts re-emerged, setting the tone for a year in which monetary policy would oscillate between growth concerns and political pressure.

The inauguration of President Trump on 20 January marked a turning point. Early tariff announcements against Canada, Mexico and China triggered risk-off episodes and contributed to higher term premia, especially at the long end of the US curve. Fixed income markets became increasingly sensitive to policy credibility, fiscal sustainability and inflation risks, culminating in several episodes of abrupt curve steepening. These tensions peaked in early April with the so-called “Liberation Day” reciprocal tariff announcements. The resulting equity crash spilled into rates, with the US 30-year yield recording its largest daily jump since March 2020 as investors reassessed recession and inflation tail risks simultaneously.

By mid-year, fiscal concerns took centre stage. In the US, Moody’s downgrade of sovereign debt and the passage of the “One Big Beautiful Bill Act” reinforced fears of structurally higher deficits. Long-dated Treasury yields repeatedly tested the 5% threshold, even as growth momentum began to slow. Ultimately, weakening labour market data over the summer gave the Fed room to pivot decisively, delivering three rate cuts between September and December. As a result, the 10-year Treasury yield ended the year around 4.15%, down roughly 40bps year-on-year.

In Europe, the fixed income narrative was reshaped by fiscal policy rather than trade. After early ECB rate cuts supported sovereign bonds, the announcement of a €500bn German defence and infrastructure stimulus in March triggered the largest daily rise in Bund yields since reunification. This marked a regime shift: long-term yields moved structurally higher on expectations of sustained issuance and higher potential growth. Political instability in France compounded the move, pushing French yields above Italian levels for the first time in decades.

Japan provided a final pillar to the global rates story. Persistent inflation near 3%, a surprise change in political leadership and aggressive fiscal stimulus led the Bank of Japan to raise rates twice in 2025. Ten-year JGB yields surged nearly 100bps, their largest annual rise in over thirty years.

Despite these shocks, credit markets proved resilient. Strong carry, falling policy rates in the second half of the year and continued investor demand for yield drove further spread compression across investment grade and high yield, extending a multi-year rally in corporate debt.

Performance review

The year was, above all, a carry story. The Fund’s core allocation to short-dated, highly rated corporate bonds provided the main engine of returns, supported by selective positioning in our preferred segments, particularly financials (including subordinated instruments), the energy sector and CLOs. Additional positive contributions came from inflation-related strategies, US yield-curve management, and diversifying emerging-market exposure. We also maintained a proactive risk framework, notably through credit hedges (iTraxx Xover), which proved valuable as shock absorbers during periods of market stress, but weighed on performance as spreads tightened to multi-year lows across the board.

However, starting in November portfolio hedges reflecting our defensive positioning weighed on performance. In a carry-driven market with spreads reaching multi-year lows across the board, our spread-hedging strategies (on both credit and sovereign debt) detracted slightly from performance.

In terms of portfolio evolution, throughout 2025 duration was managed dynamically to reflect evolving rate-cut expectations and macroeconomic risks. We increased modified duration from 1.5 to 2.1 in January, maintaining a modest long bias in German rates as ECB easing was priced conservatively. As markets moved to price more aggressive cuts, we reduced duration to 1.9 in March and then to 1.6 in April. Ahead of the May FOMC meeting, duration was reduced further to 1.3 - its low point for the year - as markets appeared particularly optimistic about the trajectory of monetary policy. From July onwards, we rebuilt duration via the front end of the euro curve and curve-steepening strategies, as the market no longer priced rate cuts despite persistent downside risks to growth, bringing duration to its current level of 2.6.

On the credit side, we gradually increased exposure throughout the year, reaching the high-70% range, including CLOs, primarily through short-maturity issuers offering attractive carry, funded by a reduction in money market instruments, against the backdrop of steeper credit curves.

What is our outlook for the coming months?

The current environment remains characterised by gradual monetary normalisation, persistent macroeconomic and political uncertainty, and carry-driven markets amid late-cycle valuations. In this context, we continue to favour a barbell construction aimed at capturing attractive carry while preserving the portfolio’s ability to absorb temporary stress episodes, resulting in a modified duration of 2.6 slightly above that of its reference indicator.

At the core of the portfolio, exposure remains tilted toward credit (around 77–79%), primarily invested in short-dated, highly rated corporate bonds, where we find attractive risk-adjusted carry with limited spread duration.

This core allocation is balanced by the following positions:

A long exposure concentrated at the front end of the euro yield curve, where the market no longer prices additional rate cuts despite ongoing downside risks to growth.
A short position on French government bonds amid heightened political and fiscal uncertainty.
A short position on the 7–10 year US yield curve, combined with long breakeven inflation, reflecting overly optimistic rate-cut expectations amid resilient growth and inflation likely to remain above target.
Credit protection representing 7.9% via iTraxx Xover CDS, reflecting tight spreads and elevated uncertainty.
An allocation of 15.1% to money market instruments, providing an attractive and low-risk source of carry.

Finally, the portfolio offers a yield-to-maturity of 3.7%, which serves as a key source of recurring performance and the first line of defence during periods of interest rate and/or credit spread corrections.

¹Reference indicator: ICE BofA ML 1–3 Year All Euro Government Index.
Source: Carmignac, Bloomberg, 31/12/2025. Performance of the FW EUR Acc share class, ISIN LU0992624949.

Carmignac Portfolio Sécurité FW EUR Acc

ISIN: LU0992624949

Recommended minimum investment horizon: 2 years

Risk indicator*: 3/7

SFDR - Fund Classification**: Article 8

*Risk Scale from the KIID (Key Investor Information Document). Risk 1 does not mean a risk-free investment. This indicator may change over time. **Sustainable Finance Disclosure Regulation (SFDR) 2019/2088. The SFDR classification of the Funds may change over time.

Main risks of the fund

Interest Rate: Interest rate risk results in a decline in the net asset value in the event of changes in interest rates.

Credit: Credit risk is the risk that the issuer may default.

Risk of Capital Loss: The portfolio does not guarantee or protect the capital invested. Capital loss occurs when a unit is sold at a lower price than that paid at the time of purchase.

Currency: Currency risk is linked to exposure to a currency other than the Fund’s valuation currency, either through direct investment or the use of forward financial instruments.

The Fund presents a risk of loss of capital. Please refer to the Fund’s prospectus to view the exhaustive list of risks.

Fees

ISIN: LU0992624949

Maximum subscription fees paid to distributors: -

Redemption Fees: -

Conversion Fee: 0%

Ongoing Charges: 0.65%

Management Fees: 0.55% MAX

Performance Fees: -

Footnote

Performance

ISIN: LU0992624949


Carmignac Portfolio Sécurité	+2.6	+5.8	+4.5	−4.2	+0.4	+2.5	+3.9	−2.7	+0.4	+2.4
Reference Indicator	+2.3	+3.2	+3.4	−4.8	−0.7	−0.2	+0.1	−0.3	−0.4	+0.3


Carmignac Portfolio Sécurité	+4.3%	+1.8%	+1.5%
Reference Indicator	+2.9%	+0.6%	+0.3%

Source: Carmignac at 31 Dec 2025.
Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). The Fund presents a risk of loss of capital.
The return may increase or decrease as a result of currency fluctuations, for the shares which are not currency-hedged.

Reference Indicator: ICE BofA 1-3 Year All Euro Government index

Share our page via Linkedin

Share our page via X / Twitter

Share our page via Facebook

Download the PDF document

Share our page via Email

Were you satisfied with this article?

Marketing communication. Please refer to the KID/KIID, prospectus of the fund before making any final investment decisions. This document is intended for professional clients.

This material may not be reproduced, in whole or in part, without prior authorisation from the Management Company. This material does not constitute a subscription offer, nor does it constitute investment advice. This material is not intended to provide, and should not be relied on for, accounting, legal or tax advice. This material has been provided to you for informational purposes only and may not be relied upon by you in evaluating the merits of investing in any securities or interests referred to herein or for any other purposes. The information contained in this material may be partial information and may be modified without prior notice. They are expressed as of the date of writing and are derived from proprietary and non-proprietary sources deemed by Carmignac to be reliable, are not necessarily all-inclusive and are not guaranteed as to accuracy. As such, no warranty of accuracy or reliability is given and no responsibility arising in any other way for errors and omissions (including responsibility to any person by reason of negligence) is accepted by Carmignac, its officers, employees or agents.

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.

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.

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.

Access to the Funds may be subject to restrictions regarding certain persons or countries. This material is not directed to any person in any jurisdiction where (by reason of that person’s nationality, residence or otherwise) the material or availability of this material is prohibited. Persons in respect of whom such prohibitions apply must not access this material. Taxation depends on the situation of the individual. The Funds are not registered for retail distribution in Asia, in Japan, in North America, nor are they registered in South America. Carmignac Funds are registered in Singapore as restricted foreign scheme (for professional clients only). The Funds have not been registered under the US Securities Act of 1933. The Funds may not be offered or sold, directly or indirectly, for the benefit or on behalf of a «U.S. person», according to the definition of the US Regulation S and FATCA.
The risks, fees and ongoing charges are described in the KID (Key Information Document). The KID must be made available to the subscriber prior to subscription. The subscriber must read the KID. Investors may lose some or all their capital, as the capital in the funds are not guaranteed. The Funds present a risk of loss of capital.

The Funds’ prospectus, KIDs, NAVs and annual reports are available at www.carmignac.com/en, or upon request to the Management Carmignac Portfolio refers to the sub-funds of Carmignac Portfolio SICAV, an investment company under Luxembourg law, conforming to the UCITS Directive. The French investment funds (fonds communs de placement or FCP) are common funds in contractual form conforming to the UCITS or AIFM Directive under French law.

In the United Kingdom: the Funds’ respective prospectuses, KIIDs and annual reports are available at www.carmignac.com/en-gb, or upon request to the Management Company, or for the French Funds, at the offices of the acilities Agent, Carmignac UK Ltd, 2 Carlton House Terrace, London, SW1Y 5AF. This document was prepared by Carmignac Gestion, Carmignac Gestion Luxembourg or Carmignac UK Ltd. FP Carmignac ICVC (the “Company”) is an Investment Company with variable capital incorporated in England and Wales under registered number 839620 and is authorised by the FCA with effect from 4 April 2019 and launched on 15 May 2019. FundRock Partners Limited is the Authorised Corporate Director (the “ACD”) of the Company and is authorised and regulated by the FCA. Registered Office: Hamilton Centre, Rodney Way, Chelmsford, Essex, CM1 3BY, UK; Registered in England and Wales with number 4162989. Carmignac Gestion Luxembourg SA has been appointed as the Investment Manager and distributor in respect of the Company. Carmignac UK Ltd (Registered in England and Wales with number 14162894) has been appointed as a sub-Investment Manager of the Company and is authorised and regulated by the Financial Conduct Authority with FRN:984288.
In Switzerland: the prospectus, KIDs and annual report are available at www.carmignac.com/en-ch, or through our representative in Switzerland, CACEIS (Switzerland), S.A., Route de Signy 35, CH-1260 Nyon. The paying agent is CACEIS Bank, Montrouge, Nyon Branch / Switzerland, Route de Signy 35, 1260 Nyon.
In Belgium: This document is intended for professional clients. This content has not been validated by FSMA. The decision to invest in the promoted fund should take into account all its characteristics or objectives as described in its prospectus. This communication is published by Carmignac Gestion S.A., a portfolio management company approved by the Autorité des Marchés Financiers (AMF) in France, and its Luxembourg subsidiary Carmignac Gestion Luxembourg, S.A., an investment fund management company approved by the Commission de Surveillance du Secteur Financier (CSSF). “Carmignac” is a registered trademark. “Investing in your Interest” is a slogan associated with the Carmignac trademark. This document does not constitute advice on any investment or arbitrage of transferable securities or any other asset management or investment product or service. The information and opinions contained in this document do not take into account investors’ specific individual circumstances and must never be interpreted as legal, tax or investment advice. The information contained in this document may be partial and could be changed without notice. This document may not be reproduced in whole or in part without prior authorisation. The risks and fees are described in the KID (Key Information Document). The prospectus, KID, the net asset-values and the latest (semi-) annual management report may be obtained, free of charge, in French or in Dutch, from the management company (tel. +352 46 70 60 1) or by consulting its website or www.fundinfo.com. These materials may also be obtained from Caceis Belgium S.A., the financial service provider in Belgium, at the following address: avenue du port, 86c b320, B-1000 Brussels. The Fund (fonds commun de placement or FCP) is a common fund in contractual form conforming to the UCITS Directive under French law. Access to the Fund may be subject to restrictions regarding certain persons or countries. The Funds are not registered for retail distribution in Asia, in Japan, in North America, nor are they registered in South America. Carmignac Funds are registered in Singapore as restricted foreign scheme (for professional clients only). The Funds have not been registered under the US Securities Act of 1933. The Funds may not be offered or sold, directly or indirectly, for the benefit or on behalf of a «U.S. person», according to the definition of the US Regulation S and FATCA. In case of subscription to a fund subject to Article 19bis of the Belgian Income Tax Code (CIR92), the investor will have to pay, upon redemption of his or her shares, a withholding tax of 30% on the income (in the form of interest, or capital gains or losses) derived from the return on assets invested in debt claims. Distributions are subject to withholding tax of 30% without income distinction. In case of subscription in a French investment fund (fonds commun de placement or FCP), you must declare on tax form, each year, the share of the dividends (and interest, if applicable) received by the Fund. Any complaint may be referred to complaints@carmignac.com or CARMIGNAC GESTION - Compliance and Internal Controls - 24 place Vendôme Paris France or on the website www.ombudsfin.be.

The Management Company can cease promotion in your country anytime. Investors have access to a summary of their rights at section 5 entitled "summary of investor rights" on the following links: UK ; Switzerland ; France ; Luxembourg ; Sweden. Belgium (French) ; Belgium (Dutch)

For Carmignac Portfolio Long-Short European Equities: Carmignac Gestion Luxembourg SA in its capacity as the Management Company for Carmignac Portfolio, has delegated the investment management of this Sub-Fund to White Creek Capital LLP (Registered in England and Wales with number OCC447169) from 2nd May 2024. White Creek Capital LLP is authorised and regulated by the Financial Conduct Authority with FRN : 998349.

Carmignac Private Evergreen refers to the Private Evergreen sub-fund of the SICAV Carmignac S.A. SICAV – PART II UCI, registered with the Luxembourg RCS under number B285278.