Emma Gayrard from La Française is our Fund Manager of the Month

Emma Gayrard, CFA, is an Investment Grade Analyst-Portfolio Manager with four years of professional experience. Currently at La Française Asset Management since 2022, she has a strong background in credit analysis. Prior to her current role, Emma served as a Desk Credit Analyst at La Banque Postale Asset Management and gained valuable experience as a Sell-side Credit Analyst at TP ICAP (Europe) from 2019 to 2020. A CFA Charterholder since 2021, Emma holds a Master's in Finance from EDHEC Business School Nice (2018) and a Bachelor's in Business Administration from the same institution (2015)

What made you decide to go into the financial sector? Did you have any other vocations?

Working in finance was neither a familial nor a childhood vocation (I rather dreamt about being a pop star or a dancer at that time). Growing up, especially starting my studies EDHEC Business school, I knew that being in the financial sector, would be challenging but continuously evolving and intellectually rewarding as you have the opportunity to work with smart people, and learn from them and markets every day.  That looked very appealing. I’ve quickly been decided about working in financial markets, in the asset management industry. You need both the global macro and the micro view, and you have a long-term vision of your job while being able to act on your convictions.

How should investors orient their portfolios in this environment?

Despite year-end rally, investing in bonds continues to offer opportunities today. It’s still possible to lock attractive yield, and especially in the credit space, while investing on quality.

Naturally, Investors should maintain a diversified asset allocation, in the context of their time horizon and risk ability. I think holding a substantial cash bucket is a smart idea as cash is nowadays nicely remunerated.

What can your funds contribute that others cannot in the current market conditions?

At La Française, my team is specialized in the financial sector, mainly through subordinated debt and senior bond from niche banks. We are 5 portfolio managers and above all financial analysts, in charge of the entire securities analysis and investment. Thanks to our rigorous and premium fundamental approach, this expertise has never suffered the slightest default since 2008 (launch of the first subordinated debt funds) and defaults on subordinated debt can lead to very large and sudden losses. Also, I would say that as PM we are really available and talk a lot to clients. 

Could you give us an example of a fund that you have held for a long time in your portfolios and why?

As a credit investor, with a high beta DNA, geared toward the financial sector we have held our conviction in the European banking sector for a long time. Today, this industry is administrated by the public sector, thus not cyclical and is stronger than ever (highly capitalized, low leverage and healthy balance-sheets). More specifically, we have held and continue to like Spanish and Italian banks, whose financial health has improved considerably in recent years. Today their fundamentals are the most resilient in this environment, with less pressure on their profitability and margins, and which have higher provisions than their continental European counterparts.

What ratios does a company have to meet to be part of your portfolio?

This varies regarding the industry. In general, for corporates on the financial side I obviously look at cash generation and liquidities, also compare them vs short term engagement and investment needs, or leverage (like net debt on Ebitda). For all sectors, a strong governance is essential. We do not hesitate to avoid a company for weak governance. As an example, Credit Suisse was excluded from our portfolios since 2021. We also have our in-house ESG and carbon score for each company thanks to our ESG team. As our funds are all Article 8 or 9 (SFDR), they are a fundamental criterion when we invest.

 If you had to define yourself with 3 words, what would it be and why?

• Open minded
• Enthusiast  
• Demanding (starting with myself)

What is your favorite thing to do in your free time?

I rarely have a day without doing sport, dance, or yoga. Yoga had an important place in my life for years, and I actually teach classes during weekends.