Carmignac Investissement: Heading into 2023

We expect a very mixed economic performance across the different regions. We will have to be selective in seizing opportunities through diversification by trying to take advantage of the market trends and dynamics that seem most promising.

We focus on companies and sectors that are best able to weather an economic slowdown through:

• Innovation to address global health challenges, particularly those related to aging and obesity;

• Supply of essential goods, high and stable margin luxury goods, and harnessing digitisation and online shopping;

• Infrastructure related to the growth of artificial intelligence, such as data centers and cloud computing platforms.

The prospect of recurring waves of inflation prompts us to reconsider investment themes which have been sidelined in recent years:

• Diversifying the portfolio by investing in Asia (China, Japan) and in the manufacturing sector in the US;

• Investing in “transition” oil and gas companies committed to clean energy, in line with our sustainable approach.

After ten years of stable environment, inflation has returned with a vengeance. Caught up in this new dynamic, central banks were forced to raise interest rates, leading to a historic decline in bond prices and depressing equities (except in the energy sector, which benefited from rising commodity prices).

Thus, after years of outperformance, the high-priced growth sector – i.e. companies that are expected to grow at a significantly higher rate than the market average – has suffered, particularly the technology names. This development was reflected in Carmignac Investissement: