Edouard Carmignac has listed Theresa May among US presidential hopeful Donald Trump and other populist politicians that are prompting his investment firm to reshape its portfolios.
In a letter to investors, the founder of Carmignac says the UK prime minister’s “rush to push Brexit through leaves us scratching our heads”.
Alongside May, Carmignac describes Trump as “egregiously unqualified to head the world’s leading power” and says it is concerning the Republican Party picked him as their candidate.
However, the billionaire fund manager adds that the popularity of extremist parties in Germany and France was “no less disturbing”.
Even if populist programmes were implemented gradually, Carmignac says the firm believes it is “wise to factor them into our investment approach as of today”.
In anticipation of a return to fiscal easing alongside ongoing monetary stimulus, which has “already provided as much stimulus as it can”, Carmignac says equities and commodities were likely to benefit, while the firm was cautious on developed-market sovereign bonds.
“After a more than 35-year bull run that has kept their prices up, they now have little more value to offer.
“In contrast, equities stand to gain from accommodative fiscal policies, which would reassure investors about economic stability, provided that interest-rate hikes don’t get out of hand.”
Carmignac says less “erratic” growth and a pick-up in inflation would benefit oil and gold.