2014-H1

The market

The economic growth in Europe remains well below historical levels. This growth is significantly lower than the equity market expectations. But in line with the growth potential held in our investment criteria.

Our portfolio

Our acquisitions during the Greek crisis are delivering a clear outperformance in 2014. We continue to profit from the market run to sell some positions having achieved our goals.

We are profiting of the rare sell-off in Europe, due to fears in emerging countries, to buy a motorway company and more recently a mine of non-precious metals.

Above all we used the lower option premium on equity indices in early June to cover most of our market risk over several years. So we will benefit from historically cheap insurance in a truly uncertain economic environment.

Going forward

The hedging strategy has significantly improved our portfolio stability. The cost of insurance should be financed largely by the expected dividends of our investments. The current allocation, less dynamic than in the past, does not affect our goal of wealth creation. On the contrary it strengthens our future ability to buy new undervalued companies with a less volatile capital.