Performance Avenir - French stocks
Discover the value of growth
Past performances should not be seen as a guide to future performances.
ISIN Code : FR0007082359
Information to download
Simplified Prospectus : Performance Avenir
Monthly management report : April 2012
Disclaim : This English translation is for the convenience of English-speaking readers. However, only the French text has any legal value. Consequently, the translation may not be relied upon to sustain any legal claim, nor should it be used as the basis of any legal opinion. Euronext Paris SA expressly disclaims all liability for any inaccuracy herein.
Background
In the French financial markets there are more than 600 small and medium business stocks to analyse. They are split between the Premier Marché, the Nouveau Marché, Alternext and the Marché Libre.
The small caps sector presents numerous opportunities for investing:
- The large number of stocks available presents a diversified choice.
- The smaller companies are generally composed of a single business and the business model is therefore easily understandable.
- The structure of small companies and their niche positioning means they are often less sensitive to monetary and macroeconomic risks.
In themselves, small caps represent a real pool of growth potential.
The law n°2006-1726 of 23 December 2006 on the ratio of “other stocks”, known as “ratio poubelle”, (which prevented funds from investing more than 10% of their capital in Alternext-type shares) was abrogated in January 2007. This news means good investment prospects for Alternext stocks, a market in which we are already present.
Objectives
- Maximum protection of the capital invested.
- To outperform French equities over the medium to long term through a rigorous selection of the best French stocks, mainly among small and medium capitalisations.
Management strategy
Atypical companies
- We identify new companies which are in a growth phase (often a more important factor than their sector) or belong to a sector which is not yet represented in the main national indices
- This diversity allows us to invest in companies which are often atypical, but which have the potential to become the future ‘nuggets’ of the Parisian index.
- We invest in companies which are less exposed to sudden jolts in the economy and which offer at the same time growth and strong visibility. Equally we invest in those businesses which present clear defensive characteristics, with secure business plans thanks to high repeat turnover.
To analyse the management of companies
After analysing the financial strengths and weaknesses of a business, our management team makes a point of meeting with the management of the business. Trust in the quality of management is vital and quantitative criteria alone cannot make up for this. This trust can sometimes even outweigh the financial ratios
Risk management
In order to limit the risks inherent in medium capitalisation stocks, Performance Avenir is composed up of around one hundred stocks. The largest positions do not exceed 5% of holdings over the long term. This wide diversification is the source of the low volatility of the fund.
Awards: The fund received in May 2006, the Standard & Poors ‘5-star’ rating and the highest ‘Lipper’ distinction in the categories of ‘Capital Preservation’, ‘Regular Performance’ and ‘Absolute Performance’.
Advantages and disadvantages
Advantage: Investment in Small and medium cap securities serves in benefiting from the dynamism of such securities, wich are often less exposed on an international level (dollar risk, US activity, etc.).
Disavantage: Small and medium cap securities present lesser liquidity owing to norrower monitoring, performance trends can be quite tangibly decorrelated with that of the major indexes.