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Carmignac Portfolio Grande Europe: Letter from the Fund Manager - Q2 2025

[Management Team] [Author] Denham Mark
Author(s)
Mark DENHAM
Published on
July 14, 2025
Read time
3 minute(s) read
+2.60%
Carmignac Portfolio Grande Europe’s performance in the 2nd quarter of 2025 for the F EUR Share class.
+2.49%
Performance of the Reference indicator1 in the 2nd quarter of 2025.
+95.06%
Performance of the Fund since Mark Denham took over (17/11/2016) vs +98.85% for its reference indicator.

During the second quarter of 2025, Carmignac Portfolio Grande Europe (F share class) posted a positive return of +2.60%, providing a return above its reference indicator which rose +2.49%.

Market environment

The second quarter of 2025 was marked by heightened volatility, underpinned by persistent geopolitical tensions and shifting monetary policy dynamics. Amid this turbulence, monetary policy acted as a stabilizing force. The European Central Bank cut interest rates twice—each by 25 basis points—bringing the key policy rate to 2.25%, its lowest level since 2022. These moves were broadly supportive of risk assets, particularly in the context of softening inflationary pressures and a more accommodative policy stance globally.

Investor sentiment, however, remained highly sensitive. The renewed threat of U.S. tariffs on European imports—proposed by President Trump at rates as high as 50%—was a significant source of market stress. While the initial announcement triggered a sharp risk-off move, the subsequent delay of the tariff implementation to July 9 provided a temporary reprieve. This window of relief catalysed a strong rally in European equities, buoyed by improving consumer sentiment and a resurgence in risk appetite. Nonetheless, this momentum proved fragile. As the tariff deadline approached and uncertainty resurfaced, markets retraced gains, ending the quarter on a more cautious note.

Performance review & positioning

After a difficult first quarter, the fund participated in the somewhat surprising rally post the initial sell-off post tariff announcements. The rebound was also led by an eclectic collection of sectors with Telecoms, Financials, Industrials, Real estate and Technology all relatively strong. These are sectors which would not normally be supportive for the fund; however, stock selection was positive enough to offset any headwinds.

In Q2, healthcare continued to be one of the weaker areas of the market and is a large exposure in the fund. Ongoing concerns over attempts by the US administration to cut healthcare costs have hung heavy over the pharmaceutical stocks, including attempts to instigate a “most favoured nation” pricing deflator. In practice we do not see this having a significant impact on most companies. We are also waiting to see what tariff level will be applied to the sector by the US, which has been unhelpful. These concerns plus weak prescription growth continued to hinder Novo Nordisk, which fell 7% in the period. On a positive note, the banning of cheap counterfeit versions of their weight loss drug should allow prescriptions to revert to a growth trajectory in the second half this year. Consequently, we retain conviction in the name.

Overall, our stock selection in Healthcare was strong enough to allow the sector to contribute positively to fund performance, primarily through strong performance of Galderma which rose +25% as market expectations rose for its portfolio of dermatological products, especially the recently launched eczema drug Nemluvio. Hearing aid manufacturer Demant was another bright spot, rising 12%, anticipating better growth in 2H sales after a subdued first quarter.

We have reduced some of our exposures in the sector in recent weeks, including Zealand Pharma, where we expect a more competitive environment for their yet to be launched obesity portfolio. We also cut back biotech name Argenx, where after a stellar performance in 2024 rising 80%, we expect a quieter year this year and few research & development catalysts to spur upside.

In Europe we had confirmation that the German government is to pursue large scale spending on defence and infrastructure in the coming years through establishing and implementing a 500bn€ fund. We expect this to have meaningful beneficial impact on the German economy and on several companies who we expect to have exposure to this spending. Some of our pre-existing names such as Siemens and Schneider are set to benefit, but we have also pro-actively added several new names with more targeted exposure including warehouse equipment company Kion, whose stock was a large contributor for us in Q2 rising 36%, as well as IT service company Bechtle and engineering services company SPIE. All these names should benefit from the plan, while also being stocks that conform to our stringent financial and sustainability criteria.

The Financial sector continues to perform well in Europe, rising more than 5% in the period. Since the aftermath of the banking crisis of 2008, the banking sector has been repairing itself through cost cutting, some mergers & acquisitions and better capital allocation. It has also had the tailwind of rising interest rates boosting income in recent years.
Most balance sheet financials still do not meet our criteria, however after recent changes some now do, including UBS which is proceeding well with integrating Credit Suisse and given that the Swiss government has made clear future capital requirements, investors can now focus on the jewel in their crown – their Wealth management business which is significantly undervalued relative to global peers. This is a name we have added to the fund. In addition, we have reinforced our conviction in direct to consumer platforms Fineco and Nordnet as we expect that distribution channels to continue gaining market share in Europe.

Outlook

We retain our exclusive focus on companies demonstrating consistently high profitability and reinvestment, and the best sustainability standards, as we believe these names will deliver the highest and most consistent long term profit growth. The good news is that the recent pullback in such companies offers the long-term investor an opportunity to add to holdings, which we have been doing.

Source: Carmignac, Bloomberg, 30/06/2025.
1From 01/01/2025 the Benchmark was changed to MSCI Europe (Net Return, EUR), historical data will be chain linked with STOXX Europe 600 (Net Return, EUR).

Carmignac Portfolio Grande Europe

A high conviction, sustainable European equity strategy
Discover the fund page

Carmignac Portfolio Grande Europe F EUR Acc

ISIN: LU0992628858
Recommended minimum investment horizon
5 years
Risk indicator*
4/7
SFDR - Fund Classification**
Article 9

*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

Equity: The Fund may be affected by stock price variations, the scale of which is dependent on external factors, stock trading volumes or market capitalization.
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: LU0992628858
Entry costs
We do not charge an entry fee. 
Exit costs
We do not charge an exit fee for this product.
Management fees and other administrative or operating costs
1.17% 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
0.58% 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: LU0992628858
Carmignac Portfolio Grande Europe−1.7+12.0+15.5−20.6+22.5+14.4+35.5−9.6+11.0+5.1
Reference Indicator+8.5+8.8+15.8−10.6+24.9−2.0+26.8−10.8+10.6+1.7
Carmignac Portfolio Grande Europe+10.1%+7.3%+6.2%
Reference Indicator+12.8%+11.2%+6.3%

Source: Carmignac at Jun 30, 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: MSCI Europe NR index

Share

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.