Edouard Carmignac, chief executive of independent management firm Carmignac Gestion, was the first speaker at the second day of the Morningstar Investment Conference today.

The theme of his talk was risk and he said that investors remained far too risk averse.

The reason for this was that the economy and markets were currently behaving as ‘schizophrenic’.

This was because ‘the three different universes, USA, Europe and emerging markets were all obeying different rules’.

He said: “Risk aversion is currently too high yet valuations in markets should push us to take more risk especially in emerging markets.

“I think the notion of emotional control is interesting and the difficulty with clients is they want to buy rising stocks at their highest as they feel comfortable with that. The difficulty then for fund managers is to go against that and make investments decision where the value is.”

He said his firm saw opportunities in emerging markets and especially continued strong growth in China which he recently visited with his team.

Mr Carmignac said he invested in companies in the developed world which had their main exposure in emerging markets and had increased the indirect exposure to these companies.

When asked what was the most important asset to hold in a portfolio, he said: “We adopt a policy of active asset allocation, in a long term portfolio we would hold a sizeable consumption in emerging markets.”

Being a French banker, he also spoke about his views on the future of the Eurozone.

“The Eurozone will be very different two years from now, we will have a core Europe made up of the countries prepared to align their fiscal policy with Germany and those other countries who will be making trade agreements with these core countries.

“The important thing is that Greece can no longer be in the Eurozone and if we were to give them the means to hang in the Eurozone we would have to invest so much that other countries such as Portugal would want the same thing and we cannot afford that.”