Alternative strategies

Carmignac Portfolio Merger Arbitrage Plus

Share Class

LU2585801173

Carmignac Portfolio Merger Arbitrage Plus fund performance

Performance Overview

Data as of:  12 Feb 2025.

Calendar Year Performance (as %)

Calendar Year Performance (as %)

Data as of:  31 Jan 2025.
Carmignac Portfolio Merger Arbitrage Plus - I GBP Hdg Acc
Carmignac Portfolio Merger Arbitrage Plus I GBP Hdg Acc+5.2 %---
Category Average----
Ranking (quartile)----
​Past performance is not necessarily indicative of future performance. Performances are net of fees (excluding possible entrance fees charged by the distributor). Morningstar Rating™ :  © Morningstar, Inc. All Rights Reserved. The information contained herein: is proprietary to Morningstar and/or its content providers; may not be copied or distributed; and is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.
Source: Carmignac at 31/01/2025.

Statistics (%)

These measures are used to assess a Fund's risk-adjusted performance. A well-performing Fund should ideally have a solid return (measured by the Sharpe ratio and alpha) relative to its risk (measured by volatility), while being well aligned with market expectations (measured by beta relative to the reference indicator).

Volatility

Data as of:  31 Jan 2025.
Fund+1.8 %-+1.9 %

Calculation : Weekly basis

Source: Carmignac at 31 Jan 2025.

Comments from the Investment Team

Read the Investment team's analysis below.

Carmignac Portfolio Merger Arbitrage Plus Monthly comments

Data as of:  31 Jan 2025.
The Investment team

Market Environment

  • January was a month of contrasts for Merger arb performance, with an excellent start to the month driven by a general tightening of merger arb spreads. This movement reflects the optimism of all players with the arrival of the Trump administration, which should be more favorable to M&A activity. This sentiment is also present in Europe, where Marcus Bokkerink, Chairman of the UK's Competition and Markets Authority (CMA), has been dismissed by the British government, which would like to see a new chairman more favorable to growth and business.

  • The end of January saw the US Department of Justice (DOJ) file a lawsuit to block Hewlett Packard Enterprise's $14 billion acquisition of Juniper Networks. The DOJ argued that the merger would reduce competition in the enterprise wireless equipment market, consolidating the sector from three major players (HPE, Juniper and Cisco Systems) to just two. This decision took the market by surprise, and led to a return of uncertainty for more complex deals such as Surmodics.

  • The HFRX Merger Arbitrage index gained +1.35% over the month.

  • Measured by the number of transactions, M&A activity was down slightly, with 18 deals announced worldwide. This slight downturn was due in particular to announcements in the United States, which slowed down pending the Trump administration's first measures.

  • Three deals worth over $10 billion were announced: Johnson & Johnson announced the acquisition of Intra-Cellular Therapies, Inc. for a total of around $14.6 billion to strengthen its position in neuroscience, the Italian banking sector continues to be active with the announcement of the hostile takeover of Mediobanca by Banca Monte Dei Paschi di Siena for 13 billion euros, and finally the launch of a hostile bid by QXO for specialist building products distributor Beacon Roofing Supply ($11 billion).

Performance Commentary

  • The fund posted a positive performance over the month.

  • Main positive contributors to performance were: DS Smith, Shinko, Banco Sabadell and Hess.

  • Main negative contributors to performance were: Juniper and Surmodics.

Outlook and Investment Strategy

  • The fund's investment rate is 120%, up on the previous month.

  • With 46 portfolio positions, diversification remains satisfactory

  • 2024 was a very complicated year for Merger Arbitrage: strong antitrust pressure, particularly in the US, with some deals blocked (Capri, Albertsons) and others under increased scrutiny (Hess, Pioneer Natural Resources, Catalent or Juniper), recovery in M&A activity not as strong as expected due to this increased scrutiny from the competition authorities, highly volatile deals (DS Smith, United States Steel, China Traditional Chinese Medicine) which led to the unwinding and closure of several Merger Arbitrage portfolios within the largest investment platforms.

  • Outlook for 2025 is much brighter, thanks to a more favorable antitrust environment for M&A activity worldwide: change of administration in the US following Trump's election, publication of the Draghi report in Europe recommending the emergence of national champions to face global competition, regulator in the UK pushed by the political class to prioritize economic activity, Japanese market continuing to open up to foreign capital. Lower interest rates should also drive M&A activity in the quarters ahead.

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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.
Carmignac Portfolio is a sub-fund of Carmignac Portfolio SICAV, an investment company under Luxembourg law, conforming to the UCITS Directive.
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.