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Carmignac Portfolio Global Bond: Letter from the Fund Manager - Q1 2026

[Management Team] [Author] Rigeade Guillaume
Author(s)
Guillaume RIGEADE
Published on
April 20, 2026
Read time
4 minute(s) read
+0.34%
Performance of the Fund in the 1st quarter of 2026 (A EUR Acc Share class).
+0.59%
Performance of the reference indicator1 in the 1st quarter of 2026 (A EUR Acc Share class).
+6.86%
Outperformance of the Fund over its recommended investment horizon (three years) versus its reference indicator1 A EUR Acc Share class).

In the first quarter of 2026, Carmignac Portfolio Global Bond posted a performance of +0.34%, compared with +0.59% for its reference indicator1.

Market review

The first quarter of 2026 was dominated by a succession of geopolitical and political shocks, culminating in the outbreak of war involving Iran, which ultimately drove a sharp repricing across fixed income markets.

The first two months of the year unfolded in a relatively constructive, albeit increasingly fragile, environment. Political risks resurfaced quickly, with tensions around Greenland, renewed tariff threats and the US intervention in Venezuela contributing to a gradual deterioration in sentiment. Uncertainty around trade policy following the US Supreme Court ruling on tariffs, combined with growing concerns over the impact of artificial intelligence (AI) on employment and emerging signs of stress in private credit, further increased investor caution.

This environment led to a clear rise in risk aversion and supported sovereign bond markets, resulting in a decline in yields, with 10-year German and US rates falling by around 20 basis points and 30 basis points respectively in February.

March, however, marked a clear regime shift. The outbreak of military conflict with Iran at the end of February and the disruption risk around the Strait of Hormuz triggered a sharp surge in energy prices and a reassessment of inflation risks. Euro area inflation rose to 2.5% in March, and the ECB warned on 19 March that the conflict was creating upside risks to inflation and downside risks to growth. Inflation expectations moved significantly higher, with the euro area 1-year inflation swap rising by 157 basis points in March to 3.37%. In turn, markets rapidly shifted from pricing potential rate cuts to anticipating further monetary tightening, leading to a broad sell-off across fixed income assets.

Sovereign bond markets reacted abruptly. In Europe, 10-year Bund yields rose by 15 basis points over the quarter to reach 3.00%, closing above this threshold for the first time since 2011, including a 36 basis point increase in March alone, while the repricing was even more pronounced at the front end, with the 2-year yield rising by 62 basis points over the month, reflecting a rapid repricing of monetary policy expectations towards more than three hikes by year-end. In the United States, Treasury yields also moved higher, with the 10-year reaching around 4.30% at quarter-end.

Credit markets followed the same pattern, with a marked increase in risk aversion. Spreads widened significantly across the board, as reflected in the rise of the iTraxx Xover index, which widened by 93 basis points in March, highlighting the broad-based repricing of credit risk.

On FX markets, the US dollar was positive overall during the quarter, declining in January amid debasement concerns before rebounding from February in a more risk-averse environment and extending its gains in March. Commodity-linked and emerging market currencies, particularly in Latin America, also performed well.

Performance Review

The fund delivered a positive performance over the quarter, with contributions primarily driven by currency strategies, while rates and spread products were more mixed in a volatile environment marked by shifting rate expectations and geopolitical tensions.

Rate strategies were negative overall. Detractors included long positions in German rates as well as exposure to emerging market rates, notably in Hungary and South Africa, in a context of rising yields. These were partially offset by gains from short positions on US, UK and French rates, particularly during the March repricing driven by higher inflation expectations. Inflation strategies also contributed positively.
Spread products delivered an overall neutral contribution. Hard-currency emerging market debt was impacted by the sharp repricing observed in March, driven by both higher underlying rates and widening spreads. Corporate credit remained broadly neutral over the period, while credit hedging strategies, notably through CDS, contributed positively.

Currency strategies were the main contributor to performance over the quarter. The US dollar was the primary driver, complemented by gains on several commodity-linked and emerging currencies, notably the Norwegian krone, Brazilian real, Australian dollar and Mexican peso.

Modified duration was actively managed throughout the quarter, starting at 3.3, declining to around 2.8 at the end of February, before being rebuilt to approximately 4.5 by quarter-end.

In February, declining yields driven by risk aversion—linked to AI concerns, geopolitical tensions and tariff uncertainty—led us to reinforce our short exposure to US rates, against a backdrop of resilient growth and persistent inflation.

Following the escalation of the Iranian conflict and the associated repricing in global rates, we progressively increased duration. This was focused on the front end of European curves, particularly Germany, France and Italy, where yields became more attractive as markets priced in an excessive number of ECB rate hikes relative to the growth outlook.

We also adjusted our inflation strategies by extending duration, switching part of our exposure from short-dated to longer-dated instruments.

In March, we reduced our euro exposure from 62% to 42%, reallocating towards the US dollar (from 9% to 15%) and the Japanese yen (from 5% to 14%).

Outlook

The global environment is characterised by heightened uncertainty, driven by geopolitical tensions, rising energy prices and persistent inflationary pressures, while growth remains relatively resilient. In this context, central banks face constrained policy flexibility. The portfolio is positioned with a higher modified duration, around 4.5, primarily driven by exposure to emerging markets, European rates, particularly Germany, and complemented by credit carry.

In rates, we maintain a cautious stance in the United States, where resilient growth and inflation risks argue for upward pressure on yields. Conversely, we favour European duration at the front end, particularly in Germany, where market expectations for rate hikes appear excessive relative to the macroeconomic outlook. We also maintain short positions in France and the UK, reflecting fiscal concerns, and remain short Japan given ongoing inflation dynamics. In emerging markets, we continue to favour selective countries offering attractive real yields.

Our exposure to spread products remains significant, with a focus on hard-currency emerging market debt and selective corporate credit, which contribute both carry and diversification. However, given tighter valuations and episodic risk aversion, we maintain hedging strategies to mitigate potential spread widening.

In foreign exchange, we retain limited US dollar exposure. We favour a diversified basket of emerging and commodity-linked currencies, while maintaining exposure to the Japanese yen, supported by ongoing monetary policy normalisation.

Source: Carmignac, Bloomberg, 31/03/2026. Performance of the A EUR Acc Share class, ISIN code: LU0336083497.
1Reference indicator, JPM Global Government Bond index. (coupons reinvested).

Carmignac Portfolio Global Bond

A global, flexible and macroeconomic approach to fixed income markets
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Carmignac Portfolio Global Bond A EUR Acc

ISIN: LU0336083497
Recommended minimum investment horizon
3 years
Risk indicator*
2/7
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

Credit: Credit risk is the risk that the issuer may default.
Interest Rate: Interest rate risk results in a decline in the net asset value in the event of changes in interest rates.
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.
Discretionary Management: Anticipations of financial market changes made by the Management Company have a direct effect on the Fund's performance, which depends on the stocks selected.
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: LU0336083497
Entry costs
2,00 % 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
1,24 % 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
0,14 % 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

ISIN: LU0336083497
Carmignac Portfolio Global Bond+0,3+0,5+1,8+3,0−5,6+0,1+4,7+8,4−3,7+0,1
Reference Indicator+0,6−6,0+2,8+0,5−11,8+0,6+0,6+8,0+4,3−6,2
Carmignac Portfolio Global Bond+1,1 %+0,3 %+1,7 %
Reference Indicator−1,2 %−2,5 %−0,5 %

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.
The return may increase or decrease as a result of currency fluctuations, for the shares which are not currency-hedged.

Reference Indicator: JPM Global Government Bond index

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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.

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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.

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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.