Citywire + rated Marc Renaud has eaten into his ‘unusually’ high cash reserves after finding growing value opportunities in the European market.
The Paris-based boutique founder had pushed cash to 11.8% in his flagship Mandarine Valeur fund, according to data from the end of January. Renaud had held more than this in the final days of January before settling to 11.8% on January 31.
The rationale given was there were limited value opportunities in the market, and Renaud preferred sitting on liquidity rather than increasing positions in existing holdings.
It is understood that the end of January slump has opened up opportunities, with Renaud deploying a huge chunk of position, which was reduced to 2% in mid-February.
Renaud normally runs almost fully invested with 2-3% cash, so the 11.8% position was ‘unusual and only occurring over short periods of time’. This, the company added, was either due to market movements or subscription/redemption patterns.
In a statement to Citywire Selector, a spokesperson for Mandarine Gestion said Renaud’s strict adherence to value screening meant there was little beyond commodities and energy to invest in, due to high valuations.
‘Some of those had even reached fair value, which triggered a sale. Since then things have changed and Marc has benefitted from the slump by buying back stocks which looked attractive,’ the spokesperson said.
Renaud announced in December of last year that he had struck a strategic deal with insurance giant Crédit Mutuel Arkéa, which took a 15% stake in Mandarine Gestion.
On a three-year basis to the end of January 2018, the Mandarine Valeur returned 23.5% in euro terms. This compares to a 27.5% by its Citywire-assigned benchmark, the STOXX Europe 600 TR EUR, over the same period.