The Fund delivered a positive performance over the month, outperforming its declining performance indicator.
The Fund benefited from its stock selection, particularly with Hermès, SAP, and Galderma.
Conversely, Novo Nordisk disappointed investors with results that fell short of expectations for its new experimental anti-obesity drug. However, this decline was mitigated by the put options we held on the Danish stock.
Regarding interest rates, our cautious approach proved successful once again this month, and our exposure to credit was also positive.
s we enter 2025, market sentiment in Europe is extremely negative. However, there are several potential sources of positive news that could improve performance over the year: political developments in Germany and France, the economic situation in China, geopolitical factors, and lower-than-expected US tariffs.
In this context, we believe that investing in equities, particularly those aligned with our quality and growth convictions, presents an attractive opportunity.
Additionally, given the global increase in debt and national deficits, budgetary constraints will compel central banks (excluding those in the United States) to play a significant role in providing economic support in 2025.
Therefore, we are maintaining our exposure to credit, which continues to offer an attractive yield and some visibility regarding potential performance.
We remain cautious about sovereign bonds, preferring inflation-linked bonds over nominal rates. We also anticipate steeper yield curves, making short rates an effective hedge against risky assets in the event of unexpected macroeconomic deterioration.
To enhance the overall construction of our portfolio, we have implemented several decorrelation strategies, including exposure to commodities, UK rates, and volatility.
Europe | 100.0 % |
Total % Equities | 100.0 % |
Market environment
The month was characterized by a cautious market environment, with investors balancing optimism about economic growth against concerns about inflation and monetary policy. Nevertheless, the year turned out to be favorable for risky assets, even though Europe experienced significant regional disparities, with the DAX rising sharply and the CAC 40 declining due to political uncertainty.
In December, although the Fed and the ECB cut their key rates, they indicated that they would remain vigilant, albeit for different reasons. The Fed was cautious due to persistent uncertainty about inflation in the United States, while the ECB was concerned about growth in Europe.
In response to the Fed's cautious stance on inflation, interest rates rose again, with a steepening yield curve reflecting the fears of central bankers.
In equities, US markets fell, while European and Asian markets recovered. However, cyclical sectors were particularly hard hit, whereas growth sectors performed well.