Carmignac Portfolio Emerging Patrimoine: Letter from the Fund Managers - Q1 2026
In the first quarter of 2026, Carmignac Portfolio Emerging Patrimoine delivered a net performance of +3.06%, outperforming its reference indicator (+0.66%), driven primarily by the rebound of its equity investments and, to a lesser extent, by its credit protection strategies.
Market environment
The first quarter of 2026 was marked by a clear inflection in global market dynamics, with a transition from a supportive environment at the start of the year to a more volatile and geopolitically driven backdrop by quarter-end.
The first two months extended the positive momentum observed in 2025, emerging market assets benefited from a combination of a still-accommodative financial conditions and strong fundamentals. In equities, this translated into continued strength in North Asian technology and commodity-linked markets, while in fixed income, both local and hard-currency was supported by yield compression and currency appreciation.
This environment shifted markedly in March following the escalation of the conflict in the Middle East. The outbreak of hostilities involving Iran triggered a sharp energy shock, with oil prices rising above $110 per barrel amid disruptions to flows through the Strait of Hormuz. This led to a broad repricing across asset classes, with rising inflation expectation, higher global yields and a marked increase in risk aversions.
Emerging market equities experienced a sharp correction, reversing part of their earlier gains. The impact, however, was highly differentiated. Oil-importing economies, particularly in South and Southeast Asia, were the most exposed, with India facing a sharp drawdown amid rising energy costs and currency pressures. By contrast, commodity-exporting countries, like in Latin America, benefited from improved terms of trade and stronger investor flows. North Asian markets, particularly South Korea and Taiwan, demonstrated relative resilience, supported by continued strength in the semiconductor and AI-related sectors.
In fixed income, the geopolitical shock triggered a sharp shift in monetary policy expectations. Markets moved from pricing potential rate cuts to anticipating a more hawkish stance from central banks, reflecting renewed inflation concerns. In the United States, this repricing led to a significant rise in yields, with the 2-year and 10-year Treasury increasing by around 42 and 28 basis points respectively in March. This move also spilled over into emerging markets, putting upward pressure on local rates and tightening financial conditions.
As a result, hard-currency debt came under pressure amid widening spreads, while local debt was impacted by both higher rates and currency depreciation. Nevertheless, some commodity-linked currencies proved more resilient, benefitting from higher energy price.
Overall, the quarter highlighted the increasing importance of selectivity with emerging markets. While the asset class faced a more challenging environment, underlying fundamentals remained relatively strong, with contained inflation, improved external balances and more credible monetary policy frameworks compared to previous periods of stress.
Performance review
During the first quarter of 2026, the Fund delivered a positive absolute performance, outperforming its reference indicator, supported by the strong performance of its equity selection and its defensive positioning, notably through credit protection strategies.
On the equity side, performance was driven by our exposure to Asia, particularly South Korea and Taiwan, which were the main contributors over the quarter despite the March sell-off. Our technology holdings were the key drivers, benefiting from continued strength across the AI value chain. In Taiwan, TSMC was the largest contributor, supported by sustained demand for advanced semiconductors and its leading position in the AI hardware ecosystem. South Korea also contributed positively, with SK Hynix benefiting from strong memory pricing and ongoing earnings upgrades, while Hyundai Motor performed well as the market increasingly recognized the value of its robotics subsidiary, Boston Dynamics. Latin America also contributed positively, with names such as Axia Energia supported by strong stock selection and improving investor sentiment. Conversely, some positions in India and in platform businesses detracted, amid broader market weakness and concerns over the sustainability of asset-light models in a more competitive AI-driven environment.
On the fixed income side, contributions were slightly negative over the quarter. In local-currency debt, performance was initially supported by our long duration positioning during the first two months of the year, particularly in high real rate environments. However, these gains were more than offset by the sharp repricing in rates observed in March. Our long positions in local rates, notably in South Africa, Peru and Colombia, were the main detractors as yields moved higher, despite some positive contributions from selected Latin American markets such as Mexico and Brazil.
Hard-currency sovereign debt was the main detractor within fixed income, in a context of widening spreads. Our exposures to Egypt and Romania were particularly impacted, with Egypt proving more sensitive to the deterioration in global risk sentiment. However, this negative contribution was largely offset by our credit protection strategies, notably via CDS indices such as iTraxx Xover, which performed well during the market correction.
Finally, currency allocation contributed positively over the period. Despite a negative contribution from the U.S. dollar, the Fund benefited from its exposure to several commodity-linked currencies, including the Kazakh tenge and the Chilean peso, which were supported by rising energy prices.
Outlook for coming months
Going forward, while geopolitical developments may continue to generate short-term volatility, our medium- to long-term investment thesis on emerging markets remains unchanged. Emerging economies today benefit from stronger fundamentals, more credible central banks and healthier external balances than in previous cycles, providing a solid foundation to navigate the current environment. We therefore remain constructive on emerging market assets, supported by resilient fundamentals, improving external balances and still-attractive valuations across both equities and fixed income. However, in a context of heightened geopolitical uncertainty and rising inflation risks, we believe a more selective and flexible approach is warranted.
Over the quarter, we have actively reduced the overall risk profile of the portfolio. Net equity exposure was gradually lowered from around 36% at the beginning of the year to below 10% at the end of March, and modified duration was reduced from approximately 220bps to around 120bps, notably through the implementation of short positions on developed market rates. These adjustments reflect our focus on preserving capital while maintaining exposure to the most compelling opportunities.
On the equity side, we maintain a positive but selective bias, focusing on companies with strong structural growth, high earnings visibility and robust balance sheets. Asia remains a core pillar of the portfolio, particularly through exposure to the AI value chain, with high-conviction positions such as TSMC and SK Hynix. At the same time, we have reduced exposure to more cyclical or vulnerable areas such as India, although we remain confident in its long-term growth prospects. We also retain selective exposure to Latin America, supported by attractive valuations and improving macro dynamics.
In fixed income, we have reduced our exposure to local-currency debt in countries more sensitive to the energy shock, particularly in Central and Eastern Europe. We remain selectively invested in markets offering attractive real yields, including parts of Latin America and South Africa. In hard-currency sovereign debt, we maintain a broadly stable allocation, focusing on our core convictions such as Côte d’Ivoire, Egypt and Romania, while increasing exposure to Ecuador, where improving macroeconomic discipline and ongoing reform momentum support a constructive outlook.
In a context of elevated energy prices and renewed inflationary pressures, we maintain exposure to inflation-linked bonds in selected markets, notably Brazil and Poland. We have also strengthened our credit protection strategies, both through indices and single-name CDS, including positions on countries more exposed to geopolitical risks such as Qatar and South Africa.
On currencies, we have significantly adjusted our positioning. We reduced our exposure to the euro from around 40–50% to approximately 25% and increased our allocation to the U.S. dollar to around 35% in March, before lowering back at the end of the period. We continue to favour commodity-linked currencies such as the Brazilian real and Kazakh tenge, which benefit from the current energy environment, and have taken profits on the Chilean peso following its strong performance earlier in the year. In contrast, we have reduced exposure to several Asian currencies, which are more vulnerable as net energy importers. We have also built a position in the Chinese renminbi, which remains less sensitive to global risk sentiment and brings decorrelation.
1Reference indicator: 40% MSCI EM NR index + 40% JPM GBI-EM Global Diversified Composite index + 20% €STR Capitalized index.
Carmignac Portfolio Emerging Patrimoine
Carmignac Portfolio Emerging Patrimoine A EUR Acc
- Recommended minimum investment horizon
- 5 years
- Risk indicator*
- 3/7
- SFDR - Fund Classification**
- Article 8
*Risk Scale from the KID (Key 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
Fees
- Entry costs
- 4.00% of the amount you pay in when entering this investment. This is the most you will be charged. Carmignac Gestion doesn't charge any entry fee. The person selling you the product will inform you of the actual charge.
- Exit costs
- We do not charge an exit fee for this product.
- Management fees and other administrative or operating costs
- 1.83% of the value of your investment per year. This estimate is based on actual costs over the past year.
- Performance fees
- 20.00% when the share class overperforms the Reference indicator during the performance period. It will be payable also in case the share class has overperformed the reference indicator but had a negative performance. Underperformance is clawed back for 5 years. The actual amount will vary depending on how well your investment performs. The aggregated cost estimation above includes the average over the last 5 years, or since the product creation if it is less than 5 years.
- Transaction Cost
- 0.71% of the value of your investment per year. This is an estimate of the costs incurred when we buy and sell the investments underlying the product. The actual amount varies depending on the quantity we buy and sell.
Performance
| Carmignac Portfolio Emerging Patrimoine | 7.3 | -14.4 | 18.6 | 20.4 | -5.2 | -9.6 | 7.8 | 1.9 | 14.2 | 3.1 |
| Reference Indicator | 10.6 | -5.8 | 18.2 | 1.5 | 1.6 | -8.4 | 6.6 | 8.2 | 9.5 | 0.7 |
| Carmignac Portfolio Emerging Patrimoine | + 6.9 % | + 2.1 % | + 4.7 % |
| Reference Indicator | + 7.6 % | + 3.1 % | + 5.0 % |
Source: Carmignac at Mar 31, 2026.
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.
Reference Indicator: 40% MSCI EM NR index + 40% JPM GBI-EM Global Diversified Composite index + 20% €STR Capitalized index. Quarterly rebalanced.
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.