Carmignac’s AAA-rated Mark Denham shares his ‘investment recipe’

Mark Denham, Carmignac

Mark Denham is Head of European Equities at Carmignac and manages, amongst other funds, FP Carmignac European Leaders, a Europe ex-UK large cap equity fund. Mark is rated AAA by Citywire for his three-year rolling risk-adjusted performance across all funds he is managing to 30/04/2020.

How are you navigating the current backdrop?

In order to keep the long term in focus and tolerate shocks, including the pandemic we have been experiencing for months now, we seek visibility. Good visibility is needed to navigate the current volatile and turbulent environment. With the setback on the world economy inflicted by the lockdowns, and the uncertainty the coronavirus has brought with regards to the resumption of “normal” activity, we prefer to stick to our robust approach and decided not to stride from our path. After all, we set a 3 to 5 years horizon for our companies to prove their quality and thus recommend our investors a minimum holding period of 5 years as well.

Can you give us an overview of your “robust approach” as you name it?

In one sentence, we are looking for quality businesses with long-term growth prospects, exhibiting high profitability and reinvesting internally for their future. We run a financial screen based on five key metrics – including return on investments, reinvestments, and operating margin stability – complemented by in-depth fundamental analysis. We also integrate social responsibility metrics, which allow us to refine the scope: we exclude companies operating in controversial sectors, and we favor those with a positive contribution on society or the planet, according to our proprietary and third-party ESG research.

Has this investment approach proven successful until now?

I have spent more than 16 years developing and finetuning this approach, and I believe that it has shown its potential. In fact, Citywire’s recent attribution of the “AAA” Fund manager rating 1 is a testament to this well-oiled approach, as it covers the three-year risk-adjusted performances of all the funds I am managing to April. For years now, it has helped me seize several themes offering structural growth drivers, which have proven to be resilient in the current context, thanks to their well-rounded risk management and foresightedness. So yes, I suppose we can say it has proven successful until now!

FP Carmignac European Leaders A GBP Acc. ISIN Code: GB00BJHPHZ49For more information, please visit the Fund’s web page.

1 Source and Copyright: Citywire. Mark Denham is AAA-rated by Citywire for his rolling three-year risk-adjusted performance across all funds he is managing to 30 April 2020. Citywire Fund Manager Ratings and Citywire Rankings are proprietary to Citywire Financial Publishers Ltd (“Citywire”) and © Citywire 2014. All rights reserved. You may only use this material for your personal and non-commercial use. No part of this material may be copied, distributed or adapted in any form or by any means without prior written consent. This includes but is not limited to all individual fund manager data such as rankings of fund managers and ratings of fund managers. Citywire does not accept any liability for your reliance upon, or any errors or omissions in, the Citywire Ratings or Citywire Rankings. Past performance is not necessarily indicative of future performance. The reference to a ranking or prize is no guarantee of the future results of the UCIS or the manager.