FP Carmignac Global Equity Compounders celebrates its three-year anniversary

Compounders are high-quality companies that choose to reinvest their earnings sustainably to generate future growth. By investing in compounders, the Fund aims to benefit from profitable business models that reinvest their earnings internally to finance their future growth. By ploughing capital back into their business instead of paying dividends, compounders create additional growth engines, for example through innovation or product development, which allows the company to live on over economic cycles and generations.

We can observe from the graph above that compounders in the portfolio since launch generate higher average EPS than the MSCI World, reflecting potential better profitability over the long term. In this way, the Fund benefits from the compounding effect.

Thanks to its structured and quantifiable process, FP Carmignac Global Equity Compounders identifies companies that possess the ability not only to grow their earnings consistently over time but also to effectively execute their strategies due to their operational excellence. This enables us to build up strong convictions while optimising their weight based on the economic cycle to form a concentrated portfolio of 41 stocks with an active share of 85% at the end of June 2023.

Eli Lilly, Colgate, SAP or L’Oréal – for examples – have demonstrated their resilience by adapting their business model to changes in their environment over time. Their ability to adapt and continue to invest, even in difficult times, makes them major players in their sectors. The same ability can also lead them to maintain their position in the future.

By investing in compounders, FP Carmignac Global Equity Compounders aims to achieve
long-term outcomes and therefore build a legacy not only for the investors themselves, but also one that can be passed on from one generation to the next.

With this objective of transmission through the generations, we are convinced that, as investors, it is our responsibility to create value for our clients through a sustainable approach, and to have a positive footprint for future generations. We strive to identify firms generating positive change based on the Sustainable Development Goals (SDGs) defined by the United Nations.

The Fund also aims to reduce its carbon emissions relative to its reference indicator (MSCI WORLD, USD, Reinvested Net Dividends).