Grasping the most promising opportunities within the emerging universe
A concentrated and high conviction portfolio seeking high alpha generation across the diversified emerging market universe.
A Fund focused on selecting high-quality companies that offer attractive long-term growth prospects, with sound financials and sustainable profitability.
Calendar Year Performance 2014Calendar Year Performance 2015Calendar Year Performance 2016Calendar Year Performance 2017Calendar Year Performance 2018Calendar Year Performance 2019Calendar Year Performance 2020Calendar Year Performance 2021Calendar Year Performance 2022Calendar Year Performance 2023
+ 5.8 %
+ 5.2 %
+ 1.4 %
+ 18.8 %
- 18.6 %
+ 24.7 %
+ 44.7 %
- 10.7 %
- 15.6 %
+ 9.5 %
Net Asset Value
1188.9 €
Asset Under Management
875 M €
Market
Emerging markets
SFDR - Fund Classification
Article
9
Data as of: 29 Feb 2024.
Data as of: 18 Mar 2024.
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.
Emerging markets were up sharply in February, in contrast to January, which was a trickier month. Share indices (+6.9% for the Hang Seng, +9.6% for the CSI 300) benefitted from new stimulus by the Chinese government, which lowered its 5-year interest rates by another 25 basis points. China also celebrated its lunar new year, pushing consumer spending and tourism back up to pre-Covid levels. Tourist spending was 7.7% higher than it was over the same period of 2019, reaching CNY 632.7bn (EUR 81.5bn). However, looking at the economic data, the NBS manufacturing indicator was in contraction territory (49.1 in February after 49.2 in January) for the fifth month in a row, showing that the country has yet to resolve its structural problems. India’s annual inflation fell to 5.1% in January. Its manufacturing indicator gained 2.4% over November and 3.8% over December. In this context, the Nifty 50 returned +1.2% over the month. South Korea’s economy continued to benefit from US-China tensions and the buzz surrounding AI stocks, as the KOSPI index gained 6.5%.
Performance commentary
The Fund delivered a positive return, and beat its reference indicator. China’s lunar new year and economic stimulus pushed local markets into the black, having a positive impact on our Chinese portfolio. In the consumer discretionary sector, we benefitted from the performance of New Oriental Education and Anta Sports Products, as well as Vipshop whose earnings were much better than expected. In South Korea, Hyundai shares leapt at the beginning of the month thanks to strong global sales in January, despite the weak US vehicle market. Samsung Electronics also gained ground early in the month, as did its semiconductor peers. In Latin America, local indices were down slightly. However, careful stock selection meant our portfolio delivered a neutral performance over February. More specifically, Eletrobras offset the poor fortunes of Equatorial Energia and MercadoLibre in Brazil. In Mexico, industrial real estate firm Vesta was down, but financial group Banorte stopped our South American portfolio from reporting a loss or bucking the Fund’s upward trend.
Outlook strategy
We remain optimistic for emerging markets in 2024. The vast emerging world presents numerous opportunities across all regions and sectors, as valuations are attractive. China remains weak, with a struggling real estate market and only mild improvement in domestic consumer spending. However, Chinese authorities’ monetary and fiscal stimulus is starting to pay off. We are keeping a significant allocation to Chinese markets, taking advantage of market inefficiencies and the upside potential for consumer companies with strong balance sheets and valuations that do not fully reflect their underlying fundamentals or growth prospects. Nearly all of the Chinese companies in our Fund are leaders in their field, with high cash flows to sustain decent margins against the current backdrop of weak growth. We took advantage of Chinese markets’ rally to reduce our exposure to China, closing positions in WuXi Biologics and online services specialist Meituan. Elsewhere in Asia, we are keeping our top holdings in the technology sector (Taiwan Semiconductor, Samsung Electronics), which are receiving impetus from the artificial intelligence trend. During the month, we increased our exposure to the Indian market and, in particular, its banking sector through private bank Kotak Mahindra, which we strengthened as valuations had returned to reasonable levels. Lastly, we keep strengthening Latin American countries that are benefitting from structural trends such as reindustrialisation in North America and economic developments including the rise in commodity prices. We are positioned on industrial real estate company Vesta in Mexico, and infrastructure company Eletrobras in Brazil. Carmignac Emergents still has a concentrated portfolio with exposure balanced between growth and discounted stocks, and with a particular emphasis on valuations and sustainability criteria.
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.
The Fund is a common fund in contractual form (FCP) conforming to the UCITS Directive under French law.
The information presented above is not contractually binding and does not constitute investment advice. Past performance is not a reliable indicator of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor), where applicable. Investors may lose some or all of their capital, as the capital in the UCI is not guaranteed. Access to the products and services presented herein may be restricted for some individuals or countries. Taxation depends on the situation of the individual. The risks, fees and recommended investment period for the UCI presented are detailed in the KIDs (key information documents) and prospectuses available on this website. The KID must be made available to the subscriber prior to purchase.). The reference to a ranking or prize, is no guarantee of the future results of the UCITS or the manager.
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Market environment
Emerging markets were up sharply in February, in contrast to January, which was a trickier month. Share indices (+6.9% for the Hang Seng, +9.6% for the CSI 300) benefitted from new stimulus by the Chinese government, which lowered its 5-year interest rates by another 25 basis points. China also celebrated its lunar new year, pushing consumer spending and tourism back up to pre-Covid levels. Tourist spending was 7.7% higher than it was over the same period of 2019, reaching CNY 632.7bn (EUR 81.5bn). However, looking at the economic data, the NBS manufacturing indicator was in contraction territory (49.1 in February after 49.2 in January) for the fifth month in a row, showing that the country has yet to resolve its structural problems. India’s annual inflation fell to 5.1% in January. Its manufacturing indicator gained 2.4% over November and 3.8% over December. In this context, the Nifty 50 returned +1.2% over the month. South Korea’s economy continued to benefit from US-China tensions and the buzz surrounding AI stocks, as the KOSPI index gained 6.5%.