Carmignac Portfolio Patrimoine Europe

This month has seen an erosion of American exceptionalism.

Uncertainties surrounding the policies of Trump 2.0 have weighed heavily on the morale of American consumers and businesses, reigniting fears about economic growth.

In the absence of visibility in the United States, investor attention has shifted to the rest of the world, where valuation levels remain low.

European equities benefited from this trend, despite Trump's protectionist threats.

Investors began to anticipate a ceasefire between Russia and Ukraine. Politics was the main focus of attention during the month, with tense meetings between European leaders and the Trump administration.

The financial sector was the best performer in the equity markets alongside the defense sector.

All the main bond segments recorded positive returns during the month, with the fall in US rates having repercussions on the global market.

In this context, the fund recorded a positive performance, but one that was lower than its reference indicator.

The selection of quality stocks weighed on the relative performance of the Fund.

The fund's relative underperformance can be explained by our investments in technology stocks (such as ASML and Capgemini) as well as in the healthcare sector.

On the other hand, our convictions in the industrial (e.g. Kingspan) and financial (e.g. Adyen and Deutsche Boerse) sectors performed well.

Our diversification strategies, including index options, the European automotive and chemical sectors and the VIX, also posted a positive performance.

In bonds, our positioning on sovereign rates was beneficial.

Similarly, our credit strategies continue to perform well, supported by an embedded yield.

Given the continuing uncertainties regarding the evolution of US fiscal and tariff policies, as well as their implications for inflation and economic growth, we continue to diversify our portfolio.

Rather than reducing our equity exposure, which remains at around 40%, we are opting for sector diversification and buying protection through options.

We continue to believe that the consensus is still too pessimistic in Europe. We are therefore maintaining a negative sensitivity to the eurozone and retaining substantial exposure to credit.

We also maintain a significant exposure to commodities, which should benefit from the political and geopolitical uncertainties on the continent.

The Fund is strategically positioned to take advantage of a potential resurgence of interest in a region that has been largely neglected by investors.