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In August, the Fund delivered a negative performance in both absolute and relative terms.
The underperformance relative to our reference indicator was primarily driven by the Healthcare and Tech sectors.
The technology sector faced pressure following earnings reports from several major firms that either missed expectations or included cautious forward guidance, contributing to the broader market sell-off.
Microsoft, our largest holding, was among the impacted names. While the company exceeded Q2 earnings expectations, its weaker-than-anticipated revenue outlook for Q3 unsettled investors and weighed on sentiment.
Vertex Pharmaceuticals was the top detractor in healthcare, falling over 14% due to a clinical trial failure. Despite strong fundamentals with 12% YoY revenue growth and $12B in cash, the setback overshadowed its earnings beat and weighed on sentiment.
Conversely, Novo Nordisk emerged as the top contributor. After facing several headwinds in recent months, the stock rebounded strongly, delivering a 15% gain in August.
At the sector level, Consumer Staples stood out as the strongest performer, demonstrating resilience amid broader market volatility.
Unilever, a position we recently initiated, reported strong results. The operational separation of its ice cream business was completed in July, a strategic move viewed as a value unlock that enables greater focus on higher-margin segments.
Prysmian which has been a contributor to the Fund for the past few months continued its strong momentum, capitalizing on robust demand in electrification and digital infrastructure.
Our macroeconomic framework continues to advocate for a defensive approach to equity markets.
During the month, we made some adjustments to our portfolio. We initiated a position in Siemens which should benefit from Germany’s new infrastructure investment plan and the region’s industrial pivot.
On the other side, we have reduced our position in Home depot and Prysmian crystallizing gains after their strong run in recent months and reducing risk to cyclical sentiment reversals.
Political uncertainty in the US continues to inject volatility into markets while the euphoric rally in domestic European sectors appears overextended.
In this environment, higher visibility should be rewarded. We therefore maintain our stance, limiting exposure to cyclical stocks in favour of quality.
Healthcare illustrates this opportunity. Policy and tariff uncertainties have weighed on the sector, but greater clarity on regulation and trade policy could catalyse a significant re-rating.
North America | 64.6 % |
Europe | 35.4 % |
Carmignac Portfolio Grandchildren is an intergenerational Fund that focuses on high-quality companies to help investors build capital not only for themselves, but also for future generations.
Market environment
Markets have been climbing the wall of worry for most of the summer.
In August 2025, equity markets posted solid gains globally, with major indices such as the S&P 500 and Nasdaq reaching new record highs. These gains were primarily driven by a small group of mega-cap technology firms, including Nvidia, Microsoft, Apple, and Amazon.
At Jackson Hole, following the release of July’s US non-farm payrolls—which suggested a slowing labour market—Powell opened the door to potential mid-September rate cuts. This fueled expectations of an aggressive cutting cycle.
European markets underperformed in local currencies, with France lagging in particular due to political uncertainties.
Chinese onshore equities rose to decade highs, supported by optimism around anti-involution reforms, strength in the technology sector, and incremental government measures aimed at boosting the equity market.
The euro appreciated against the dollar over the period, creating a divergence between local currency and euro-denominated index performances.