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Edouard Carmignac: the art of swimming against the current.

His investment fund, Carmignac Gestion, has experienced spectacular growth since the 2008 crisis.

Article also available in : English EN | français FR

When a financier emits theories that are not validated by observers, he puts money on the table to get his points across. This is exactly what Edouard Carmignac did at the beginning of autumn by buying himself a full publicity page in Le Monde, Le Figaro, El Pais and the Financial Times. The whole point of it? A poisoned departing gift to the person who had globally been sparred by analysts and economists: Jean Claude Trichet, the governor of the European Central Bank. Carmignac had already written a pamphlet against Trichet in Le Monde two years earlier.

The initiative surprised a lot of people. First in its timing (on the eve of Trichet’s departure. He was benefitting from a lot of positive comments before his final exit) then in its virulence. “We won’t regret you!” attacked Carmignac in an open letter which figures prominently on the official website of Carmignac Gestion. He then blamed Jean Claude Trichet for having “worsened the impact of the 2008 crisis by underestimating its scale and endangering the euro by inconsiderate rate hikes”. To top it all off, Carmignac judged Trichet’s support policy of weakened European countries’ debt to be grossly insufficient. These are excessive critics that do not take into account the regulatory corset of the ECB which was notably defended by Germany against one and all.

This open letter once again demonstrated that Edouard Carmignac remained a free thinker prone to provocation which is exactly how those who him well describe him.

Aged 64 years old, this Frenchman, with roots in Normandy, grew up in Peru until the age of 12 before heading to Paris for his higher studies and later obtained an MBA at Columbia Business School. He is currently considered to be one of the most original personalities in European finance

A small well organized group can bring down the greatest of all powers just like a small firm with a good product can become a multinational
Edouard Carmignac

With facial traits similar to those of François Pinault and a tendency to munch his words, Carmignac knows how to give an artistic side to his activity. This pop art fan who has giant portraits of Lenin and Mao in his office located at Place Vendôme is a a specialist of counter opinion. He created Carmignac Gestion back in 1989 after working at Blyth, Eastman, Dillon & Co at New York and BNP Paribas in Paris. Why did he choose Lenin and Mao to decorate his office? “To convince myself at every moment of my existence that a small well organized group can bring down the greatest of all powers just like a small firm with a good product can become a multinational” he explained in 2009 to the magazine Challenges.

The way that Carmignac Gestion has grown over the past few years supports his beliefs and gives credibility to his old dated willingness (which was mocked at the beginning) to follow in the footsteps of the American fund Fidelity.

After only eight years, the volume of assets managed by the different funds overseen by Carmignac Gestion has grown from 797 million euros (2002) to…more than 45 billion euros (2011). Nowadays, the fund employs 180 persons among which are 22 analysts and fund managers. It invests in 50 exchanges worldwide.

After only eight years, the volume of assets managed by the different funds overseen by Carmignac Gestion has grown from 797 million euros (2002) to…more than 45 billion euros (2011)

The activities have grown substantially since the beginning of the 2008 financial crisis. They have benefited most notably from a sharp focus on emerging markets and commodities which are the historical specialty of Edouard Carmignac.

Assisted by Eric Helderlé, Carmignac is much more involved in the firm’s financial and strategic development as well as its overall management than sales, marketing, IT systems and common daily tasks which he leaves to his managing director. “Several fund managers prove to be good in managing money but not when it comes to managing their firm” he asserted to the Financial Times in 2009.

Carmignac’s touch is however very present as demonstrated by the morning meetings regrouping a single team of managers and which are as rocky and animated as the big boss’s personality. Carmignac is described as relishing these tests of balance of powers where in order for two or more beneficiaries to emerge, there can be only one victor.

A highly skilled polo player, he has won several tournaments and most notably the Queen’s Cup in London. “I love kissing the queen” he said in one of those witty comments that have the knack for enraging his critics

Johann Harscoët , February 2012

Article also available in : English EN | français FR

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