Fixed income strategies

Carmignac Portfolio Flexible Bond

SICAVGlobal marketSRI Fund Article 8
Share Class

LU2490324337

A flexible solution aiming to capture bond opportunities globally
  • A conviction-driven Fund aiming to seize global bond markets opportunities while systematically hedging the currency risk.
  • An investment process based on a top-down asset allocation and a bottom-up implementation of interest rate and credit strategies.
Asset Allocation
Bonds80.5 %
Other19.5 %
Data as of:  28 Mar 2024.
Risk Indicator
2/7
Recommended Minimum Investment Horizon
3 years
Cumulative Performance since launch
+ 11.2 %
-
-
-
+ 5.7 %
From 30/06/2022
To 18/04/2024
Calendar Year Performance 2023
-
-
-
-
-
-
-
-
+ 4.6 %
+ 4.5 %
Net Asset Value
111.2 €
Asset Under Management
1 289 M €
Market
Global market
SFDR - Fund Classification

Article

8
Data as of:  18 Apr 2024.
​Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor).

Carmignac Portfolio Flexible Bond fund performance

Take a look at the Fund's performance supported by our Fund managers’ market commentary and strategy insight.

Our monthly comments

Data as of:  29 Mar 2024.
Fund management team
[Management Team] [Author] Rigeade Guillaume

Guillaume Rigeade

Co-Head of Fixed Income, Fund Manager
[Management Team] [Author] Eliezer Ben Zimra

Eliezer Ben Zimra

Fund Manager

Market environment

Central bank meetings held no big surprises in March, although the Bank of Japan did bring an end to its negative interest rate policy by raising its key rate from -0.1% to a range of 0%–0.1%. However, the prospect of coordinated easing by the European Central Bank and the Federal Reserve seems to be receding as US growth and inflation figures remain higher than expected. Despite a dovish tone, the Federal Reserve has been forced to revise its growth forecasts upwards for the cycle ahead. The consumer price index beat traders’ forecasts once again at +3.2% y/y, after another disappointing publication the previous month, while core inflation remains well above target at 3.8%. Other indicators were just as robust, and include retail sales and industrial production, which rebounded in February. Job growth of 275,000 over the month was also surprisingly high. The trend in Europe is more subtle as countries show a little more fiscal orthodoxy to meet EU deficit requirements. However, the publication of leading indicators (PMIs) was encouraging with an improvement in services activity, which is now settled in expansionary territory, and signs that consumer confidence is returning. The ECB put out a reassuring message, lowering its inflation forecasts even though services inflation is stuck at 4% and commodity price pressures seem to be mounting after easing considerably in 2023.

Performance commentary

Our Fund delivered a very good performance over March, in line with the reference indicator. This came with low volatility thanks to resilient performance drivers and low modified duration. Our buy-and-hold strategies keep adding to the portfolio’s returns, while our inflation-linked instruments are benefitting from the global economy’s more upward trajectory and the deterioration of the geopolitical situation. We stuck to our investment philosophy in March, continuing to hedge the credit portfolio with cheap protection and lowering our modified duration. By month-end, our high yield credit index hedging had increased from 18% to 23%, while the Fund’s duration dropped from 2.2 to 1.4 after we sold Japanese 10-year bonds ahead of the BoJ meeting, and reduced exposure to the euro yield curve. We further increased our exposure to European breakeven inflation.

Outlook strategy

The main developed economies’ robustness is paradoxically good but also slightly worrying news for the markets, as it results solely from countries’ new budget deficit paradigm. The increase in borrowing has created imbalances that are starting to weigh on bonds, as fiscal policy contradicts the monetary policy goals of the main central banks. This no-landing scenario for the economy also rules out any prospect of inflation returning to target, as economic data continues to amaze investors. On top of this, commodity prices – which had been the main factors behind disinflation – have surged, and will probably now weigh on producer and consumer price indices. This economic outlook suggests we should be keeping the portfolio’s modified duration low, with a preference for the short end of yield curves. We are remaining short on the long end, for which abundant supply is likely to meet lower demand at a time when central banks are reducing the size of their balance sheets. We are also short on Japanese government bonds after the BoJ began a rate-hiking cycle in March. On credit markets, we are keeping high gross exposure to sub-segments that offer good carry, such as subordinated financial debt and structured credit, while consolidating our net exposure through cheap hedging to cushion any exogenous shocks. The weighting of our inflation-linked strategies is still high, as these should benefit from raised inflation expectations and provide good cover from any increase in geopolitical risk.

Performance Overview

Data as of:  18 Apr 2024.
​Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). 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.On 30/09/2019 the composition of the reference indicator changed: the ICE BofA ML Euro Broad Market Index coupons reinvested replaces the EONCAPL7. Performances are presented using the chaining method. The Fund’s name was changed from Carmignac Portfolio Capital Plus to Carmignac Portfolio Unconstrained Euro Fixed Income.
Source: Carmignac at 21/04/2024

Carmignac Portfolio Flexible Bond Portfolio overview

Below is an overview of the composition of the portfolio.

Geographical Breakdown

Data as of:  28 Mar 2024.
Europe67.6 %
North America10.6 %
Latin America7.8 %
Eastern Europe7.2 %
Middle East2.9 %
Africa2.5 %
Asia1.0 %
Asia-Pacific0.3 %
Total % of bonds100.0 %
Europe67.6 %
itItaly
16.7 %
ieIreland
9.2 %
gbUnited Kingdom
8.8 %
frFrance
7.6 %
Grèce
6.3 %
esSpain
3.7 %
deGermany
3.1 %
Norvège
2.7 %
nlNetherlands
2.6 %
atAustria
1.6 %
ptPortugal
1.5 %
smSanMarino
1.0 %
chSwitzerland
0.9 %
adAndorra
0.9 %
Suède
0.9 %

Key figures

Below are the key figures for the Fund, which will give you a clearer idea of the Fund's management and bond positioning.

Exposure Data

Data as of:  28 Mar 2024.
Modified Duration1.4
Yield to Worst5.3 %
Yield to Maturity5.5 %
Average Coupon4.6 %
Number of Issuers149
Number of Bonds193
Average RatingBBB-

The strategy in a nutshell

Discover the Fund’s main features and benefits through the words of the Fund Managers.
Fund Management Team
[Management Team] [Author] Rigeade Guillaume

Guillaume Rigeade

Co-Head of Fixed Income, Fund Manager
[Management Team] [Author] Eliezer Ben Zimra

Eliezer Ben Zimra

Fund Manager
Eliezer and myself are managing this strategy with the objective to offer investors a flexible and diversified investment solution investing across fixed income markets, while hedging the currency risk.
[Management Team] [Author] Rigeade Guillaume

Guillaume Rigeade

Co-Head of Fixed Income, Fund Manager
View Fund's characteristics
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.
Carmignac Portfolio is a sub-fund of Carmignac Portfolio SICAV, an investment company under Luxembourg law, conforming to the UCITS Directive.