UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-06312
The Lazard Funds, Inc.
(Exact name of registrant as specified in charter)
30 Rockefeller Plaza
New York, New York 10112
(Address of principal executive offices) (Zip code)
Mark R. Anderson, Esq.
Lazard Asset Management LLC
30 Rockefeller Plaza
New York, New York 10112
(Name and address of agent for service)
Registrant’s telephone number, including area code: (212) 632-6000
Date of fiscal year end: 12/31
Date of reporting period: 6/30/19
ITEM 1. REPORTS TO STOCKHOLDERS.
Lazard Funds
Semi-Annual Report
June 30, 2019
Alternatives Funds
Lazard Emerging Markets Income Portfolio
Lazard Enhanced Opportunities Portfolio
Lazard Explorer Total Return Portfolio
Important Information on Paperless Delivery
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports like this one will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. Shareholders who hold accounts directly with the Fund may elect to receive shareholder reports and other communications from the Fund electronically by signing up for paperless delivery at www.icsdelivery.com/lazardassetmanagement. If you own these shares through a financial intermediary, you may contact your financial intermediary.
You may elect to receive all future reports in paper free of charge. You can inform the Fund that you wish to continue receiving paper copies of your shareholder reports by following the instructions included with this disclosure and visiting www.fundreports.com. If you own these shares through a financial intermediary, you may contact your financial intermediary or follow instructions included with this disclosure to elect to continue to receive paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with the fund complex or your financial intermediary.
PRIVACY NOTICE
WHAT DOES LAZARD DO WITH YOUR PERSONAL INFORMATION?
Financial companies choose how they share your personal information. U.S. federal law gives our clients the right to limit some but not all sharing. U.S. federal and other applicable law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
We do not disclose nonpublic personal information about our clients or former clients to third parties other than as described below.
Personal information we collect.We collect personal information about you in connection with our providing advisory services to you. The legal basis for our collection of your personal information is our contract with you and our legitimate business interest to provide contractual services to you. The collection of this information is necessary for us to be able to provide advisory services to you and the failure to provide such information will result in our inability to provide our services. This information includes your social security number (for U.S. persons) and may include other information such as your:
● | Assets and income; | |
● | Investment experience; | |
● | Transaction history; | |
● | Credit history; and | |
● | Wire transfer instructions. |
How we collect this information.We collect this information from you through various means. For example, when you give us your contact information, enter into an investment advisory contract with us, buy securities (i.e., interests in a fund) from us, direct us to buy or sell securities for your account, tell us where to send money, or make a wire transfer. We also may collect your personal information from other sources, such as our affiliates1 or other non-affiliated companies (such as credit bureaus).
1 | Our affiliates are companiesrelated to us by common ownership or control and can include both financial and nonfinancial companies. Non-affiliates are companiesnot related to us by common ownership or control and can include both financial and nonfinancial companies. |
How we use this information.All financial companies need to share customers’ personal information to run their everyday business and we use the personal information we collect from you for our everyday business purposes. These purposes may include for example:
● | To provide advisory services to you; | |
● | To open an account for you; | |
● | To process a transaction for your account; | |
● | To market products and services to you; and/or | |
● | To respond to court orders and legal investigations. |
If you are an investor located within a European Union country, please note that personal information may be collected, shared and/or stored outside of the European Union.
Disclosure to others.We may provide your personal information to our affiliates and to firms that assist us in servicing your account and have a need for such information, such as a broker, counterparty, fund administrator or third party service provider that aggregates data in a central repository for access by a broker, counterparty or fund administrator to provide its services. We may also disclose such information to service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you. We require third party service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you to protect the confidentiality of your information and to use the information only for the purposes for which we disclose the information to them. These sharing practices are consistent with applicable privacy and related laws, and in general, you may not limit our use of your personal information for these purposes under such laws. We note that the U.S. federal privacy laws only give you the right to limit the certain types of information sharing that we do not engage in (e.g., sharing with our affiliates certain information relating to your transaction history or creditworthiness for their use in marketing to you, or sharing any personal information with non-affiliates for them to market to you). We may also share your personal information with nonaffiliates (such as a government agency or regulatory authority) as required by applicable law.
How we protect your personal information.To protect your personal information from unauthorized access and use, we use security measures that comply with applicable law. These measures include computer safeguards and secured files and buildings.
How long we keep your personal information.We retain your personal information for the duration of your advisory relationship with us and for a period of time thereafter as required by applicable law.
Your rights with respect to this information.If you are an investor located within a European Union country, you have the following rights with respect to your personal information:
● | The right to request and obtain a copy of your personal information that we maintain; | |
● | The right to correct your personal information that we maintain; | |
● | The right to request the erasure of your personal information from our systems, subject to applicable recordkeeping requirements applicable to us; and | |
● | The right to lodge a complaint with a supervisory authority. |
Who is providing this Privacy Notice.This Privacy Notice relates to the following entities:
● | Lazard Asset Management LLC | |
● | Lazard Asset Management (Canada), Inc.2 | |
● | Lazard Asset Management Securities LLC |
Who to contact with questions.If you have any questions about this Privacy Notice, please call (800) 823-6300 or visit our website at http://www.lazardassetmanagement.com.
2 | Lazard Asset Management (Canada), Inc. does not disclose any non-public personal information about its customers to any third party, except as permitted by or required by any applicable law, including the laws of the United States and Canada. |
The Lazard Funds, Inc.Table of Contents
Please consider a Portfolio’s investment objectives, risks, charges and expenses carefully before investing. For more complete information about The Lazard Funds, Inc. (the “Fund”), you may obtain a prospectus or summary prospectus by calling 800-823-6300, or online, at www.lazardassetmanagement.com. Read the prospectus or each Portfolio’s summary prospectus carefully before you invest. The prospectus and each Portfolio’s summary prospectus contain the investment objectives, risks, charges, expenses and other information about each Portfolio of the Fund, which are not detailed in this report.
Distributed by Lazard Asset Management Securities LLC.
Semi-Annual Report 1
The Lazard Funds, Inc.A Message from Lazard (unaudited)
Dear Shareholder,
Global markets registered strong gains in the first half of 2019. They reached near-record highs in April, thanks to strong corporate earnings and better-than-expected quarterly US GDP growth. However, heightened trade tensions and mixed economic data gave investors pause in May as China and the United States again raised tariffs on each other’s imports after trade talks stalled.
The US equity market rose strongly during the period, boosted by hopes that renewed trade negotiations and a potential interest rate cut by the Federal Reserve in July would keep the United States on strong economic footing. Financials, materials, and technology outperformed, while energy lagged against a backdrop of falling oil prices, concerns about global demand, and rising inventories. Volatility as measured by the CBOE Volatility Index (VIX) rose mildly but remained well below levels at the end of 2018.
European equity markets have been caught in the middle of opposing forces, mainly growing tensions around global trade and increasingly dovish central banks. This has pushed European government bond yields to fresh lows and caused bond-sensitive sectors to climb higher, further stretching valuations.
Emerging markets equities gained more than 10% year to date. The asset class’s performance was volatile over the latter half of the period, reflecting extraordinary uncertainty among investors about the geopolitical environment, particularly US actions on trade in May and early June. Emerging markets debt also delivered strong year-to-date returns, supported by liquidity from central banks. However, the global growth outlook has become more uncertain and current valuations provide less compensation for the increased risks.
2 Semi-Annual Report
In this environment, we believe it is becoming increasingly important for investors to be discerning, to focus on fundamentals and not short-term macro drivers, particularly as sentiment is vulnerable to rapid shifts. We are privileged that you have turned to Lazard for your investment needs and value your continued confidence in our investment management capabilities.
Sincerely,
Lazard Asset Management LLC
Semi-Annual Report 3
The Lazard Funds, Inc.Performance Overviews (unaudited)
Lazard Emerging Markets Income Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Income Portfolio and JPMorgan Emerging Local Markets®Index Plus*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Five Years | Since Inception† | |||||||||||
Institutional Shares** | 3.82 | % | –1.17 | % | –0.84 | % | |||||||
Open Shares** | 3.69 | % | –1.39 | % | –1.08 | % | |||||||
JPMorgan Emerging Local Markets Index Plus | 3.65 | % | –0.59 | % | –0.28 | % |
† | The inception date for the Portfolio was April 30, 2014. |
4 Semi-Annual Report
Lazard Enhanced Opportunities Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Enhanced Opportunities Portfolio, ICE BofAML U.S. Convertible ex Mandatory®Index and HFRX Global Hedge Fund®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Since Inception† | ||||||||
Institutional Shares** | 3.54 | % | 2.59 | % | |||||
Open Shares** | 3.28 | % | 2.34 | % | |||||
ICE BofAML U.S. Convertible ex Mandatory Index | 7.91 | % | 8.54 | % | |||||
HFRX Global Hedge Fund Index | –1.95 | % | 0.39 | % |
† | The inception date for the Portfolio was December 31, 2014. |
Semi-Annual Report 5
Lazard Explorer Total Return Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Explorer Total Return Portfolio, JPMorgan EMBI Global Diversified®Index, JPMorgan GBI-EM Global Diversified®Index and Global Diversified Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Five Years | Since Inception† | |||||||||||
Institutional Shares** | 4.76 | % | 0.34 | % | 0.95 | % | |||||||
Open Shares** | 4.51 | % | 0.03 | % | 0.64 | % | |||||||
JPMorgan EMBI Global Diversified Index | 12.45 | % | 5.30 | % | 6.33 | % | |||||||
JPMorgan GBI-EM Global Diversified Index | 8.99 | % | –0.45 | % | 0.26 | % | |||||||
Global Diversified Index | 10.77 | % | 2.46 | % | 3.32 | % |
† | The inception date for the Portfolio was June 28, 2013. |
Notes to Performance Overviews:
* | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), State Street Bank and Trust Company, the Fund’s administrator (“State Street”) or DST Asset Manager Solutions, Inc., the Fund’s transfer and dividend distributing agent (“DST”); without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. |
Performance results do not include adjustments made for financial reporting purposes in accordance with US Generally Accepted Accounting Principles, if any, and may differ from amounts reported in the financial highlights. For Institutional Shares and Open Shares of Lazard Enhanced Opportunities Portfolio, a one-time voluntary reimbursement by the administrator increased the total return ratio by 0.49% for year ended December 31, 2017. | |
The performance quoted represents past performance. Current performance may be lower or higher than the performance quoted. Past performance is not indicative, or a guarantee, of future results; the investment return and principal value of the Portfolio will fluctuate, so that Portfolio shares, when redeemed, may be worth more or less than their original cost. Within the longer periods illustrated there may have been short-term fluctuations, counter to the overall trend of investment results, and no single period of any length may be taken as typical of what may be expected in future periods. The graph and table above do not reflect the deduction of taxes that a shareholder would pay on the Portfolio’s distributions or the redemption of Portfolio shares. |
6 Semi-Annual Report
The performance data of the indices have been prepared from sources and data that the Investment Manager believes to be reliable, but no representation is made as to their accuracy. The indices are unmanaged, have no fees or costs and are not available for investment. | |
The JPMorgan Emerging Local Markets Index Plus tracks total returns for local currency-denominated money market instruments. | |
The ICE BofAML U.S. Convertible ex Mandatory Index measures the performance of convertible securities of all corporate sectors with a par amount of $25 million or more and a maturity of at least one year and excludes preferred equity redemption stocks and converted securities. | |
The HFRX Global Hedge Fund Index is designed to be representative of the overall composition of the hedge fund universe. It is comprised of all eligible hedge fund strategies, including but not limited to convertible arbitrage, distressed securities, equity hedge, equity market neutral, event-driven, macro, merger arbitrage, and relative value arbitrage. The strategies are asset weighted based on the distribution of assets in the hedge fund industry. | |
The JPMorgan EMBI Global Diversified Index is a uniquely weighted version of the EMBI Global. Risks associated with the securities comprising this index include fixed income and emerging markets. The JPMorgan GBI-EM Global Diversified Index is a uniquely weighted version of the GBI-EM Global. Risks include fixed income, emerging markets and derivatives. These indices limit the weights of those index countries with larger debt stocks by only including specified portions of these countries’ eligible current face amounts of debt outstanding. The countries covered in both indices are identical. | |
The Global Diversified Index is an unmanaged Index created by the Investment Manager and is a 50/50 blend of the JPMorgan EMBI Global Diversified Index and the JPMorgan GBI-EM Global Diversified Index. | |
** | The performance of Institutional Shares and Open Shares may vary, primarily based on the differences in fees borne by shareholders investing in different classes. |
Semi-Annual Report 7
Information About Your Portfolio’s Expenses (unaudited)
Expense Example
As a shareholder in a Portfolio of the Fund, you incur ongoing costs, including management fees, distribution and service (12b-1) fees (Open Shares only), and other expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the six month period from January 1, 2019 through June 30, 2019 and held for the entire period.
Actual Expenses
For each Share class of the Portfolios, the first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000=8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
For each Share class of the Portfolios, the second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the class’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other mutual funds.
8 Semi-Annual Report
Portfolio | Beginning Account Value 1/1/19 | Ending Account Value 6/30/19 | Expenses Paid During Period 1/1/19 - 6/30/19 | * | Annualized Expense Ratio During Period 1/1/19 - 6/30/19 | ||||
Emerging Markets Income | |||||||||
Institutional Shares | |||||||||
Actual | $1,000.00 | $1,048.80 | $4.52 | 0.89% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.38 | $4.46 | 0.89% | |||||
Open Shares | |||||||||
Actual | $1,000.00 | $1,048.90 | $5.23 | 1.03% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.69 | $5.16 | 1.03% | |||||
Enhanced Opportunities† | |||||||||
Institutional Shares | |||||||||
Actual | $1,000.00 | $1,059.00 | $15.01 | 2.94% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,010.22 | $14.65 | 2.94% | |||||
Open Shares | |||||||||
Actual | $1,000.00 | $1,057.80 | $16.43 | 3.22% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,008.83 | $16.04 | 3.22% | |||||
Explorer Total Return | |||||||||
Institutional Shares | |||||||||
Actual | $1,000.00 | $1,077.80 | $5.62 | 1.09% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.39 | $5.46 | 1.09% | |||||
Open Shares | |||||||||
Actual | $1,000.00 | $1,077.70 | $3.04 | 0.59% | |||||
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.87 | $2.96 | 0.59% |
* | Expenses are equal to the annualized expense ratio, net of expenses waivers and reimbursements, of each Share class multiplied by the average account value over the period, multiplied by 181/365 (to reflect one-half year period). |
† | The expense ratios include broker expense and dividend expense on securities sold short. |
Semi-Annual Report 9
The Lazard Funds, Inc.Portfolio Holdings Presented by Asset Class/Sector and Region June 30, 2019 (unaudited)
Lazard Enhanced Opportunities Portfolio | |||||||||
Asset Class/Sector | Long | * | Short | † | |||||
Equity | |||||||||
Communication Services | 8.2 | % | –9.0 | % | |||||
Consumer Discretionary | 2.5 | –3.9 | |||||||
Consumer Staples | 0.8 | –0.8 | |||||||
Energy | 2.0 | –1.4 | |||||||
Financials | 13.3 | –6.9 | |||||||
Health Care | 18.3 | –20.3 | |||||||
Industrials | 4.3 | –3.7 | |||||||
Information Technology | 19.3 | –28.0 | |||||||
Materials | 3.8 | –2.6 | |||||||
Real Estate | 0.9 | –15.1 | |||||||
Utilities | 1.3 | –0.9 | |||||||
Exchange-Traded Funds | — | –7.4 | |||||||
Short-Term Investments | 25.3 | — | |||||||
Total Investments | 100.0 | % | –100.0 | % |
* | Represents percentage of total investments excluding securities sold short. |
† | Represents percentage of total securities sold short. |
Asset Class/Region* | Lazard Emerging Markets Income Portfolio | Lazard Explorer Total Return Portfolio | ||||||||
Fixed Income | ||||||||||
Africa | 10.0 | % | 4.7 | % | ||||||
Asia | 4.4 | 21.7 | ||||||||
Europe | 2.2 | 18.2 | ||||||||
North America | 57.6 | 36.9 | ||||||||
South America | 6.4 | 18.1 | ||||||||
Purchased Options | — | 0.2 | ||||||||
Short-Term Investments | 19.4 | 0.2 | ||||||||
Total Investments | 100.0 | % | 100.0 | % |
* | Represents percentage of total investments. |
10 Semi-Annual Report
The Lazard Funds, Inc.Portfolios of Investments June 30, 2019 (unaudited)
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 11
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Emerging Markets Income Portfolio (continued) | ||||||||||
1.625%, 08/31/19 | USD | 205 | $ | 204,774 | ||||||
1.750%, 09/30/19 | USD | 126 | 125,872 | |||||||
1.000%, 10/15/19 | USD | 250 | 249,199 | |||||||
1.500%, 10/31/19 | USD | 890 | 888,192 | |||||||
3.375%, 11/15/19 | USD | 220 | 220,988 | |||||||
1.750%, 11/30/19 | USD | 460 | 459,264 | |||||||
1.375%, 12/15/19 | USD | 240 | 239,250 | |||||||
Total US Treasury Securities (Cost $2,794,870) | 2,797,761 |
Fair | ||||||||
Description | Shares | Value | ||||||
Short-Term Investments | 18.3% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $992,415) | 992,415 | $ | 992,415 | |||||
Total Investments | 94.8% (Cost $5,101,066) (») | $ | 5,126,972 | ||||||
Cash and Other Assets in Excess of Liabilities | 5.2% | 282,030 | |||||||
Net Assets | 100.0% | $ | 5,409,002 |
The accompanying notes are an integral part of these financial statements.
12 Semi-Annual Report
Lazard Emerging Markets Income Portfolio (continued)
Forward Currency Contracts open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | Unrealized | |||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | ||||||||||||||
ARS | 3,262,450 | USD | 71,000 | CIT | 07/18/19 | $ | 3,899 | $ | — | ||||||||||||
CLP | 15,996,730 | USD | 23,000 | HSB | 07/12/19 | 610 | — | ||||||||||||||
CLP | 36,666,540 | USD | 54,000 | HSB | 07/12/19 | 117 | — | ||||||||||||||
CNY | 2,555,042 | USD | 377,000 | CIT | 07/11/19 | — | 4,527 | ||||||||||||||
CNY | 1,036,275 | USD | 150,000 | CIT | 08/08/19 | 1,010 | — | ||||||||||||||
COP | 85,932,600 | USD | 26,000 | SCB | 07/12/19 | 729 | — | ||||||||||||||
COP | 167,665,000 | USD | 50,000 | SCB | 07/12/19 | 2,152 | — | ||||||||||||||
COP | 75,180,100 | USD | 23,000 | SCB | 07/26/19 | 358 | — | ||||||||||||||
CZK | 3,381,000 | USD | 146,732 | BNP | 07/26/19 | 4,540 | — | ||||||||||||||
CZK | 2,158,000 | USD | 95,909 | CIT | 06/08/20 | 1,027 | — | ||||||||||||||
CZK | 3,318,000 | USD | 145,863 | CIT | 06/08/20 | 3,179 | — | ||||||||||||||
CZK | 1,223,000 | USD | 53,750 | SCB | 06/08/20 | 1,186 | — | ||||||||||||||
HUF | 36,393,000 | USD | 128,533 | CIT | 07/19/19 | — | 299 | ||||||||||||||
HUF | 15,310,000 | USD | 53,887 | CIT | 08/01/19 | 104 | — | ||||||||||||||
IDR | 2,943,270,320 | USD | 205,796 | BNP | 09/20/19 | 469 | — | ||||||||||||||
IDR | 363,225,000 | USD | 25,000 | CIT | 09/20/19 | 455 | — | ||||||||||||||
IDR | 29,610,000 | USD | 2,000 | HSB | 09/20/19 | 75 | — | ||||||||||||||
IDR | 796,000,000 | USD | 50,000 | HSB | 09/20/19 | 5,784 | — | ||||||||||||||
ILS | 136,000 | USD | 37,947 | BNP | 07/02/19 | 161 | — | ||||||||||||||
ILS | 45,000 | USD | 12,467 | CIT | 07/02/19 | 142 | — | ||||||||||||||
ILS | 174,000 | USD | 48,774 | CIT | 08/01/19 | 72 | — | ||||||||||||||
INR | 22,091,255 | USD | 317,000 | CIT | 07/16/19 | 2,798 | — | ||||||||||||||
KRW | 415,379,000 | USD | 351,275 | HSB | 07/19/19 | 7,698 | — | ||||||||||||||
KZT | 60,483,500 | USD | 154,000 | HSB | 09/19/19 | 2,728 | — | ||||||||||||||
KZT | 2,361,000 | USD | 6,000 | SCB | 10/30/19 | 69 | — | ||||||||||||||
MXN | 698,000 | USD | 35,309 | CIT | 07/12/19 | 998 | — | ||||||||||||||
MXN | 100,000 | USD | 4,981 | HSB | 07/12/19 | 220 | — | ||||||||||||||
MXN | 555,000 | USD | 28,890 | HSB | 07/12/19 | — | 21 | ||||||||||||||
MXN | 1,325,000 | USD | 68,779 | HSB | 08/01/19 | — | 82 | ||||||||||||||
MXN | 5,038,784 | USD | 262,000 | JPM | 07/12/19 | 96 | — | ||||||||||||||
PEN | 354,570 | USD | 106,000 | HSB | 08/09/19 | 1,505 | — | ||||||||||||||
PEN | 172,115 | USD | 52,000 | HSB | 09/06/19 | 129 | — | ||||||||||||||
PHP | 4,884,140 | USD | 95,000 | HSB | 07/25/19 | 242 | — | ||||||||||||||
PLN | 1,028,000 | USD | 270,075 | BNP | 07/11/19 | 5,330 | — | ||||||||||||||
RUB | 3,254,750 | USD | 50,000 | CIT | 07/17/19 | 1,376 | — |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 13
Lazard Emerging Markets Income Portfolio (concluded)
Currency | Currency | Settlement | Unrealized | Unrealized | |||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | ||||||||||||||
RUB | 11,214,725 | USD | 173,000 | HSB | 07/17/19 | $ | 4,023 | $ | — | ||||||||||||
SGD | 439,000 | USD | 322,276 | HSB | 07/12/19 | 2,253 | — | ||||||||||||||
SGD | 98,000 | USD | 70,966 | HSB | 08/16/19 | 1,521 | — | ||||||||||||||
THB | 3,817,000 | USD | 122,293 | CIT | 08/16/19 | 2,300 | — | ||||||||||||||
THB | 2,814,000 | USD | 91,975 | HSB | 07/26/19 | — | 169 | ||||||||||||||
TRY | 368,000 | USD | 62,701 | CIT | 07/11/19 | 503 | — | ||||||||||||||
TRY | 945,000 | USD | 161,078 | HSB | 07/26/19 | — | 111 | ||||||||||||||
UGX | 301,101,300 | USD | 81,000 | CIT | 07/09/19 | 165 | — | ||||||||||||||
USD | 213,225 | AUD | 307,000 | HSB | 08/22/19 | — | 2,656 | ||||||||||||||
USD | 17,000 | BRL | 69,930 | CIT | 05/18/20 | — | 692 | ||||||||||||||
USD | 147,679 | CZK | 3,381,000 | CIT | 07/26/19 | — | 3,593 | ||||||||||||||
USD | 53,000 | DOP | 2,716,754 | CIT | 08/01/19 | — | 406 | ||||||||||||||
USD | 37,000 | EGP | 633,255 | CIT | 09/19/19 | — | 21 | ||||||||||||||
USD | 50,639 | ILS | 181,000 | CIT | 07/02/19 | — | 78 | ||||||||||||||
USD | 50,033 | RUB | 3,254,750 | CIT | 07/17/19 | — | 1,343 | ||||||||||||||
USD | 132,180 | ZAR | 1,874,000 | SCB | 07/12/19 | — | 704 | ||||||||||||||
UYU | 1,902,340 | USD | 55,000 | HSB | 09/06/19 | — | 1,613 | ||||||||||||||
UYU | 1,913,230 | USD | 55,000 | HSB | 10/04/19 | — | 1,602 | ||||||||||||||
UYU | 1,888,700 | USD | 50,000 | HSB | 05/29/20 | — | 87 | ||||||||||||||
ZAR | 1,488,000 | USD | 100,999 | HSB | 07/12/19 | 4,513 | — | ||||||||||||||
ZAR | 1,874,000 | USD | 132,445 | HSB | 07/12/19 | 438 | — | ||||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 64,974 | $ | 18,004 |
The accompanying notes are an integral part of these financial statements.
14 Semi-Annual Report
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Convertible Corporate Bonds | 115.3% | ||||||||||
Bermuda | 0.6% | ||||||||||
Teekay Corp., 5.000%, 01/15/23 (±) | USD | 75 | $ | 58,734 | ||||||
Canada | 8.9% | ||||||||||
Aphria, Inc., 5.250%, 06/01/24 (±) | USD | 107 | 95,498 | |||||||
Aurora Cannabis, Inc., 5.500%, 02/28/24 (#), (±) | USD | 156 | 188,760 | |||||||
Canopy Growth Corp., 4.250%, 07/15/23 (#), (±) | CAD | 186 | 187,839 | |||||||
Element Fleet Management Corp.: | ||||||||||
4.250%, 06/30/20 (±) | CAD | 38 | 29,103 | |||||||
4.250%, 06/30/24 (±) | CAD | 91 | 74,952 | |||||||
First Majestic Silver Corp., 1.875%, 03/01/23 (±) | USD | 40 | 42,600 | |||||||
SSR Mining, Inc., 2.500%, 04/01/39 (#), (±) | USD | 40 | 42,626 | |||||||
Tilray, Inc., 5.000%, 10/01/23 (±) | USD | 198 | 159,638 | |||||||
821,016 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 15
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
Chile | 0.6% | ||||||||||
Liberty Latin America, Ltd., 2.000%, 07/15/24 (±) | USD | 59 | $ | 59,401 | ||||||
China | 1.7% | ||||||||||
Qudian, Inc., 1.000%, 07/01/26 | USD | 79 | 80,443 | |||||||
YY, Inc., 1.375%, 06/15/26 (#), (±) | USD | 79 | 80,186 | |||||||
160,629 | ||||||||||
Mexico | 3.6% | ||||||||||
Cemex SAB de CV, 3.720%, 03/15/20 (±) | USD | 328 | 326,997 | |||||||
Netherlands | 0.6% | ||||||||||
NXP Semiconductors NV, 1.000%, 12/01/19 (±) | USD | 55 | 57,955 | |||||||
Norway | 1.3% | ||||||||||
Ship Finance International, Ltd., 5.750%, 10/15/21 (±) | USD | 120 | 121,090 | |||||||
Thailand | 2.2% | ||||||||||
Sea, Ltd., 2.250%, 07/01/23 (±) | USD | 111 | 201,711 | |||||||
United States | 95.8% | ||||||||||
Air Transport Services Group, Inc., 1.125%, 10/15/24 (±) | USD | 83 | 84,533 | |||||||
Alder Biopharmaceuticals, Inc., 2.500%, 02/01/25 (±) | USD | 47 | 43,681 | |||||||
Allscripts Healthcare Solutions, Inc., 1.250%, 07/01/20 (±) | USD | 214 | 214,029 | |||||||
Altair Engineering, Inc., 0.250%, 06/01/24 (±) | USD | 99 | 107,241 |
The accompanying notes are an integral part of these financial statements.
16 Semi-Annual Report
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
Arconic, Inc., 1.625%, 10/15/19 (±) | USD | 84 | $ | 84,855 | ||||||
Atlas Air Worldwide Holdings, Inc., 1.875%, 06/01/24 (±) | USD | 79 | 81,105 | |||||||
Benefitfocus, Inc., 1.250%, 12/15/23 (±) | USD | 123 | 109,728 | |||||||
Boingo Wireless, Inc., 1.000%, 10/01/23 (±) | USD | 70 | 59,920 | |||||||
Carbonite, Inc., 2.500%, 04/01/22 (±) | USD | 86 | 103,454 | |||||||
Chegg, Inc., 0.250%, 05/15/23 (±) | USD | 117 | 179,176 | |||||||
Cleveland-Cliffs, Inc., 1.500%, 01/15/25 (±) | USD | 82 | 118,333 | |||||||
CONMED Corp., 2.625%, 02/01/24 (±) | USD | 33 | 38,019 | |||||||
Coupa Software, Inc., 0.125%, 06/15/25 (±) | USD | 39 | 41,733 | |||||||
Cowen, Inc., 3.000%, 12/15/22 (±) | USD | 102 | 117,787 | |||||||
CSG Systems International, Inc., 4.250%, 03/15/36 (±) | USD | 110 | 121,698 | |||||||
Electronics For Imaging, Inc., 0.750%, 09/01/19 (±) | USD | 66 | 65,634 | |||||||
Encore Capital Group, Inc., 3.250%, 03/15/22 (±) | USD | 204 | 205,122 | |||||||
Enphase Energy, Inc., 1.000%, 06/01/24 (±) | USD | 59 | 66,891 | |||||||
Evolent Health, Inc.: | ||||||||||
2.000%, 12/01/21 (±) | USD | 69 | 61,335 | |||||||
1.500%, 10/15/25 (±) | USD | 85 | 54,905 | |||||||
EZCORP, Inc., 2.375%, 05/01/25 (±) | USD | 103 | 92,921 | |||||||
Forestar Group, Inc., 3.750%, 03/01/20 (±) | USD | 48 | 47,707 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 17
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
FTI Consulting, Inc., 2.000%, 08/15/23 (±) | USD | 171 | $ | 182,969 | ||||||
Green Plains, Inc.: | ||||||||||
4.125%, 09/01/22 (±) | USD | 42 | 36,213 | |||||||
4.000%, 07/01/24 (±) | USD | 79 | 74,853 | |||||||
Herbalife Nutrition, Ltd., 2.625%, 03/15/24 (±) | USD | 113 | 109,615 | |||||||
Hope Bancorp, Inc., 2.000%, 05/15/38 (±) | USD | 87 | 79,452 | |||||||
IAC Financeco 3, Inc., 2.000%, 01/15/30 (±) | USD | 51 | 52,477 | |||||||
IH Merger Sub LLC: | ||||||||||
3.000%, 07/01/19 | USD | 326 | 472,089 | |||||||
3.500%, 01/15/22 (±) | USD | 113 | 137,780 | |||||||
II VI, Inc., 0.250%, 09/01/22 (±) | USD | 99 | 104,259 | |||||||
IIP Operating Partnership L.P., 3.750%, 02/21/24 (±) | USD | 117 | 209,430 | |||||||
Innoviva, Inc., 2.125%, 01/15/23 (±) | USD | 118 | 123,752 | |||||||
Inphi Corp., 0.750%, 09/01/21 (±) | USD | 102 | 113,091 | |||||||
Intercept Pharmaceuticals, Inc.: | ||||||||||
3.250%, 07/01/23 (±) | USD | 145 | 129,284 | |||||||
2.000%, 05/15/26 (±) | USD | 83 | 82,131 | |||||||
Ionis Pharmaceuticals, Inc., 1.000%, 11/15/21 (±) | USD | 197 | 232,964 | |||||||
Jazz Investments I, Ltd., 1.500%, 08/15/24 (±) | USD | 100 | 98,511 | |||||||
Kaman Corp., 3.250%, 05/01/24 (±) | USD | 45 | 52,763 | |||||||
Karyopharm Therapeutics, Inc., 3.000%, 10/15/25 (±) | USD | 56 | 34,975 | |||||||
KBR, Inc., 2.500%, 11/01/23 (±) | USD | 90 | 104,553 |
The accompanying notes are an integral part of these financial statements.
18 Semi-Annual Report
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
Knowles Corp., 3.250%, 11/01/21 (±) | USD | 147 | $ | 176,469 | ||||||
Liberty Interactive LLC: | ||||||||||
4.000%, 11/15/29 (±) | USD | 160 | 112,846 | |||||||
3.750%, 02/15/30 (±) | USD | 101 | 69,400 | |||||||
Liberty Media Corp., 2.250%, 12/01/48 (±) | USD | 160 | 182,642 | |||||||
Ligand Pharmaceuticals, Inc., 0.750%, 05/15/23 (±) | USD | 133 | 114,827 | |||||||
Marriott Vacations Worldwide Corp., 1.500%, 09/15/22 (±) | USD | 148 | 142,903 | |||||||
Microchip Technology, Inc., 1.625%, 02/15/27 (±) | USD | 102 | 120,166 | |||||||
Neurocrine Biosciences, Inc., 2.250%, 05/15/24 (±) | USD | 114 | 149,568 | |||||||
NRG Energy, Inc., 2.750%, 06/01/48 (±) | USD | 173 | 184,778 | |||||||
Nuance Communications, Inc., 1.000%, 12/15/35 (±) | USD | 175 | 164,250 | |||||||
Nutanix, Inc., 0.000%, 01/15/23 (±) | USD | 40 | 37,347 | |||||||
Okta, Inc., 0.250%, 02/15/23 (±) | USD | 58 | 150,284 | |||||||
OSI Systems, Inc., 1.250%, 09/01/22 (±) | USD | 88 | 104,297 | |||||||
Pacira BioSciences, Inc., 2.375%, 04/01/22 (±) | USD | 143 | 146,412 | |||||||
Palo Alto Networks, Inc., 0.750%, 07/01/23 (±) | USD | 88 | 92,714 | |||||||
PAR Technology Corp., 4.500%, 04/15/24 (±) | USD | 40 | 48,747 | |||||||
PDL BioPharma, Inc., 2.750%, 12/01/21 (±) | USD | 150 | 157,468 | |||||||
Perficient, Inc., 2.375%, 09/15/23 (#), (±) | USD | 110 | 121,760 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 19
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
Pluralsight, Inc., 0.375%, 03/01/24 (#), (±) | USD | 143 | $ | 152,886 | ||||||
PRA Group, Inc.: | ||||||||||
3.000%, 08/01/20 (±) | USD | 91 | 90,120 | |||||||
3.500%, 06/01/23 (±) | USD | 132 | 123,096 | |||||||
PROS Holdings, Inc.: | ||||||||||
1.000%, 05/15/24 (±) | USD | 51 | 58,222 | |||||||
2.000%, 06/01/47 (±) | USD | 121 | 166,230 | |||||||
Q2 Holdings, Inc., 0.750%, 06/01/26 (±) | USD | 8 | 8,604 | |||||||
Rapid7, Inc., 1.250%, 08/01/23 (±) | USD | 104 | 158,730 | |||||||
Redfin Corp., 1.750%, 07/15/23 (±) | USD | 87 | 80,682 | |||||||
Redwood Trust, Inc., 4.750%, 08/15/23 (±) | USD | 80 | 78,000 | |||||||
Retrophin, Inc., 2.500%, 09/15/25 (±) | USD | 110 | 98,548 | |||||||
RWT Holdings, Inc., 5.625%, 11/15/19 (±) | USD | 111 | 111,675 | |||||||
Silicon Laboratories, Inc., 1.375%, 03/01/22 (±) | USD | 61 | 75,808 | |||||||
Synaptics, Inc., 0.500%, 06/15/22 (±) | USD | 53 | 47,336 | |||||||
Tabula Rasa HealthCare, Inc., 1.750%, 02/15/26 (±) | USD | 111 | 111,125 | |||||||
Team, Inc., 5.000%, 08/01/23 (±) | USD | 127 | 129,108 | |||||||
TerraVia Holdings, Inc., 5.000%, 10/01/19 | USD | 216 | 4,320 | |||||||
The Medicines Co., 3.500%, 01/15/24 (±) | USD | 40 | 65,314 | |||||||
Twitter, Inc.: | ||||||||||
0.250%, 09/15/19 (±) | USD | 86 | 85,496 | |||||||
0.250%, 06/15/24 (±) | USD | 55 | 53,562 |
The accompanying notes are an integral part of these financial statements.
20 Semi-Annual Report
Principal | ||||||||||
Security | Amount | Fair | ||||||||
Description | Currency | (000) | Value | |||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||||
Vishay Intertechnology, Inc., 2.250%, 06/15/25 (±) | USD | 87 | $ | 80,040 | ||||||
Wayfair, Inc., 0.375%, 09/01/22 (±) | USD | 25 | 37,842 | |||||||
Zillow Group, Inc., 2.000%, 12/01/21 (±) | USD | 124 | 140,323 | |||||||
Zynga, Inc., 0.250%, 06/01/24 (±) | USD | 67 | 66,729 | |||||||
8,831,642 | ||||||||||
Total Convertible Corporate Bonds (Cost $10,226,257) | 10,639,175 |
Number of | Exercise | Notional | Fair | ||||||||||||||
Description | Counterparty | Contracts | Price | Amount | Value | ||||||||||||
Purchased Options | 0.0% | |||||||||||||||||
Call | |||||||||||||||||
Alder Biopharmaceuticals, Inc. 15, Expires 07/19/19 | RBS | 13 | $ | 15.00 | $ | 1,300 | $ | 195 | |||||||||
Cemex SAB de CV 7, Expires 07/19/19 | RBS | 8 | 7.00 | 800 | 16 | ||||||||||||
Evolent Health, Inc. 12.5, Expires 12/20/19 | RBS | 1 | 12.50 | 100 | 40 | ||||||||||||
Infinera Corp. 4, Expires 10/18/19 | RBS | 16 | 4.00 | 1,600 | 256 | ||||||||||||
Nutanix, Inc. 37.5, Expires 10/18/19 | RBS | 4 | 37.50 | 400 | 140 | ||||||||||||
Team, Inc. 20, Expires 12/20/19 | RBS | 9 | 20.00 | 900 | 540 | ||||||||||||
Vishay Intertechnology, Inc. 20, Expires 12/20/19 | RBS | 17 | 20.00 | 1,700 | 935 | ||||||||||||
Total Purchased Options (Cost $3,292) | 2,122 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 21
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||
Short-Term Investments | 39.2% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $3,613,950) | 3,613,950 | $ | 3,613,950 | |||||
Total Investments excluding Securities Sold Short | 154.8% (Cost $13,866,598) | 14,279,696 | |||||||
Securities Sold Short | (56.6)% | ||||||||
Common Stocks | (52.4)% | ||||||||
Bermuda | (0.1)% | ||||||||
Teekay Corp. | (2,606 | ) | (8,965 | ) | ||||
Canada | (3.9)% | ||||||||
Aphria, Inc. | (6,920 | ) | (48,509 | ) | ||||
Aurora Cannabis, Inc. | (14,532 | ) | (113,640 | ) | ||||
Canopy Growth Corp. | (2,729 | ) | (110,177 | ) | ||||
Element Fleet Management Corp. | (3,422 | ) | (24,981 | ) | ||||
First Majestic Silver Corp. | (2,864 | ) | (22,654 | ) | ||||
SSR Mining, Inc. | (1,444 | ) | (19,740 | ) | ||||
Tilray, Inc. | (367 | ) | (17,088 | ) | ||||
(356,789 | ) | |||||||
Chile | (0.3)% | ||||||||
Liberty Latin America, Ltd., Class C | (1,398 | ) | (24,032 | ) | ||||
China | (0.8)% | ||||||||
Qudian, Inc. Sponsored ADR | (5,119 | ) | (38,393 | ) | ||||
YY, Inc. ADR | (551 | ) | (38,399 | ) | ||||
(76,792 | ) | |||||||
Netherlands | (0.3)% | ||||||||
NXP Semiconductors NV | (277 | ) | (27,038 | ) |
The accompanying notes are an integral part of these financial statements.
22 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||
Norway | (0.2)% | ||||||||
Ship Finance International, Ltd. | (1,914 | ) | $ | (23,944 | ) | |||
Thailand | (1.8)% | ||||||||
Sea, Ltd. ADR | (4,980 | ) | (165,435 | ) | ||||
United States | (45.0)% | ||||||||
Air Transport Services Group, Inc. | (1,679 | ) | (40,968 | ) | ||||
Alder Biopharmaceuticals, Inc. | (1,573 | ) | (18,514 | ) | ||||
Allscripts Healthcare Solutions, Inc. | (2,757 | ) | (32,064 | ) | ||||
Altair Engineering, Inc., Class A | (1,509 | ) | (60,948 | ) | ||||
Atlas Air Worldwide Holdings, Inc. | (824 | ) | (36,783 | ) | ||||
Benefitfocus, Inc. | (1,152 | ) | (31,277 | ) | ||||
Boingo Wireless, Inc. | (727 | ) | (13,064 | ) | ||||
Carbonite, Inc. | (2,009 | ) | (52,314 | ) | ||||
Chegg, Inc. | (3,685 | ) | (142,204 | ) | ||||
Cleveland-Cliffs, Inc. | (8,811 | ) | (94,013 | ) | ||||
CONMED Corp. | (243 | ) | (20,793 | ) | ||||
Coupa Software, Inc. | (169 | ) | (21,397 | ) | ||||
Cowen, Inc., Class A | (4,377 | ) | (75,241 | ) | ||||
CSG Systems International, Inc. | (679 | ) | (33,156 | ) | ||||
Encore Capital Group, Inc. | (2,615 | ) | (88,570 | ) | ||||
Enphase Energy, Inc. | (2,188 | ) | (39,887 | ) | ||||
Evolent Health, Inc., Class A | (1,649 | ) | (13,110 | ) | ||||
EZCORP, Inc. Class A | (4,378 | ) | (41,460 | ) | ||||
FTI Consulting, Inc. | (566 | ) | (47,453 | ) | ||||
Green Plains, Inc. | (3,591 | ) | (38,711 | ) | ||||
Herbalife Nutrition, Ltd. | (977 | ) | (41,777 | ) | ||||
Hope Bancorp, Inc. | (695 | ) | (9,577 | ) | ||||
IAC/InterActiveCorp | (121 | ) | (26,321 | ) | ||||
II-VI, Inc. | (1,245 | ) | (45,517 | ) | ||||
Innovative Industrial Properties, Inc. REIT | (1,556 | ) | (192,259 | ) | ||||
Innoviva, Inc. | (3,496 | ) | (50,902 | ) | ||||
Inphi Corp. | (1,067 | ) | (53,457 | ) | ||||
Intercept Pharmaceuticals, Inc. | (954 | ) | (75,910 | ) | ||||
Invitation Homes, Inc. REIT | (21,272 | ) | (568,601 | ) |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 23
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Enhanced Opportunities Portfolio (continued) | ||||||||
Ionis Pharmaceuticals, Inc. | (1,978 | ) | $ | (127,126 | ) | |||
Jazz Pharmaceuticals PLC | (214 | ) | (30,508 | ) | ||||
Kaman Corp. | (153 | ) | (9,745 | ) | ||||
Karyopharm Therapeutics, Inc. | (3,223 | ) | (19,306 | ) | ||||
KBR, Inc. | (2,494 | ) | (62,200 | ) | ||||
Knowles Corp. | (5,509 | ) | (100,870 | ) | ||||
Ligand Pharmaceuticals, Inc. | (188 | ) | (21,460 | ) | ||||
Live Nation Entertainment, Inc. | (1,575 | ) | (104,344 | ) | ||||
Marriott Vacations Worldwide Corp. | (343 | ) | (33,065 | ) | ||||
Microchip Technology, Inc. | (1,167 | ) | (101,179 | ) | ||||
Neurocrine Biosciences, Inc. | (1,054 | ) | (88,989 | ) | ||||
NRG Energy, Inc. | (1,338 | ) | (46,991 | ) | ||||
Nuance Communications, Inc. | (1,897 | ) | (30,295 | ) | ||||
Nutanix, Inc., Class A | (429 | ) | (11,128 | ) | ||||
Okta, Inc. | (1,137 | ) | (140,431 | ) | ||||
OSI Systems, Inc. | (623 | ) | (70,168 | ) | ||||
Pacira BioSciences, Inc. | (1,067 | ) | (46,404 | ) | ||||
Palo Alto Networks, Inc. | (180 | ) | (36,677 | ) | ||||
PAR Technology Corp. | (1,067 | ) | (30,089 | ) | ||||
PDL BioPharma, Inc. | (25,366 | ) | (79,649 | ) | ||||
Perficient, Inc. | (2,076 | ) | (71,248 | ) | ||||
Pluralsight, Inc., Class A | (2,452 | ) | (74,345 | ) | ||||
PRA Group, Inc. | (1,686 | ) | (47,444 | ) | ||||
PROS Holdings, Inc. | (2,621 | ) | (165,804 | ) | ||||
Q2 Holdings, Inc. | (55 | ) | (4,200 | ) | ||||
Rapid7, Inc. | (2,107 | ) | (121,869 | ) | ||||
Redfin Corp. | (1,561 | ) | (28,067 | ) | ||||
Redwood Trust, Inc. REIT | (2,115 | ) | (34,961 | ) | ||||
Retrophin, Inc. | (1,710 | ) | (34,354 | ) | ||||
Silicon Laboratories, Inc. | (458 | ) | (47,357 | ) | ||||
Synaptics, Inc. | (229 | ) | (6,673 | ) | ||||
Tabula Rasa HealthCare, Inc. | (1,191 | ) | (59,467 | ) | ||||
Team, Inc. | (3,850 | ) | (58,982 | ) | ||||
The Medicines Co. | (1,418 | ) | (51,714 | ) | ||||
Twitter, Inc. | (506 | ) | (17,659 | ) | ||||
Vishay Intertechnology, Inc. | (1,110 | ) | (18,337 | ) |
The accompanying notes are an integral part of these financial statements.
24 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Enhanced Opportunities Portfolio (concluded) | ||||||||
Wayfair, Inc., Class A | (198 | ) | $ | (28,908 | ) | |||
Zillow Group, Inc. Class C | (1,199 | ) | (55,622 | ) | ||||
Zynga, Inc., Class A | (4,081 | ) | (25,017 | ) | ||||
(4,148,900 | ) | |||||||
Total Common Stock (Proceeds $4,501,816) | (4,831,895 | ) | ||||||
Exchange-Traded Fund | (4.2)% | ||||||||
iShares 7-10 Year Treasury Bond ETF (Proceeds $374,044) | (3,496 | ) | (384,630 | ) | ||||
Total Securities Sold Short (Proceeds $4,875,860) | (5,216,525 | ) | ||||||
Total Investments | 98.2% (Cost and short proceeds $8,990,738) (») | $ | 9,063,171 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.8% | 159,801 | |||||||
Net Assets | 100.0% | $ | 9,222,972 |
Forward Currency Contracts open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | |||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Depreciation | ||||||||||
USD | 280,282 | CAD | 375,000 | SSB | 09/19/19 | $ | 6,486 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 25
The accompanying notes are an integral part of these financial statements.
26 Semi-Annual Report
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
Indonesia | 0.8% | ||||||||||||
LLPL Capital Pte, Ltd., 6.875%, 02/04/39 | USD | 500 | $ | 570,308 | ||||||||
Minejesa Capital BV, 4.625%, 08/10/30 | USD | 300 | 303,319 | |||||||||
873,627 | ||||||||||||
Nigeria | 0.9% | ||||||||||||
IHS Netherlands Holdco BV: | ||||||||||||
9.500%, 10/27/21 (#) | USD | 725 | 752,245 | |||||||||
9.500%, 10/27/21 | USD | 225 | 233,456 | |||||||||
985,701 | ||||||||||||
Panama | 0.2% | ||||||||||||
C&W Senior Financing DAC, 7.500%, 10/15/26 (#) | USD | 200 | 208,500 | |||||||||
Peru | 0.9% | ||||||||||||
Hunt Oil Co. of Peru LLC Sucursal Del Peru, 6.375%, 06/01/28 (#) | USD | 900 | 999,000 | |||||||||
Saudi Arabia | 0.8% | ||||||||||||
Acwa Power Management And Investments One, Ltd., 5.950%, 12/15/39 (#) | USD | 875 | 907,812 | |||||||||
South Africa | 0.8% | ||||||||||||
Liquid Telecommunications Financing PLC, 8.500%, 07/13/22 (#) | USD | 850 | 847,790 | |||||||||
South Korea | 0.6% | ||||||||||||
Heungkuk Life Insurance Co., Ltd., 4.475%, 11/09/22 (§), (¶) | USD | 200 | 193,000 | |||||||||
SK E&S Co., Ltd., 4.875%, 11/26/19 (§), (¶) | USD | 510 | 506,494 | |||||||||
699,494 | ||||||||||||
Tanzania | 0.6% | ||||||||||||
HTA Group, Ltd., 9.125%, 03/08/22 | USD | 625 | 654,883 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 27
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
Turkey | 0.7% | ||||||||||||
Petkim Petrokimya Holding AS, 5.875%, 01/26/23 (#) | USD | 350 | $ | 338,625 | ||||||||
Turkiye Is Bankasi AS, 5.000%, 04/30/20 | USD | 455 | 453,577 | |||||||||
792,202 | ||||||||||||
Venezuela | 0.1% | ||||||||||||
Petroleos de Venezuela SA: | ||||||||||||
5.375%, 04/12/27 («) | USD | 170 | 25,500 | |||||||||
5.500%, 04/12/37 («) | USD | 180 | 27,000 | |||||||||
52,500 | ||||||||||||
Zambia | 0.3% | ||||||||||||
First Quantum Minerals, Ltd.: | ||||||||||||
7.000%, 02/15/21 (#) | USD | 70 | 71,400 | |||||||||
7.500%, 04/01/25 (#) | USD | 200 | 190,500 | |||||||||
261,900 | ||||||||||||
Total Corporate Bonds (Cost $11,810,763) | 11,750,348 | |||||||||||
Foreign Government Obligations | 62.3% | ||||||||||||
Chile | 5.2% | ||||||||||||
Republic of Chile: | ||||||||||||
3.240%, 02/06/28 | USD | 450 | 471,797 | |||||||||
0.830%, 07/02/31 | EUR | 1,060 | 1,205,326 | |||||||||
3.860%, 06/21/47 | USD | 785 | 851,480 | |||||||||
3.500%, 01/25/50 | USD | 3,075 | 3,130,350 | |||||||||
5,658,953 | ||||||||||||
Congo | 2.0% | ||||||||||||
Republic of Congo, 6.000%, 06/30/29 (Ø) | USD | 2,550 | 2,205,413 | |||||||||
Costa Rica | 1.0% | ||||||||||||
Republic of Costa Rica: | ||||||||||||
5.520%, 05/26/21 | USD | 75 | 75,014 | |||||||||
4.250%, 01/26/23 | USD | 180 | 177,750 |
The accompanying notes are an integral part of these financial statements.
28 Semi-Annual Report
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
5.520%, 08/23/23 | USD | 770 | $ | 713,677 | ||||||||
4.375%, 04/30/25 | USD | 160 | 153,500 | |||||||||
1,119,941 | ||||||||||||
Guatemala | 1.3% | ||||||||||||
Guatemala Government Bonds: | ||||||||||||
4.900%, 06/01/30 (#) | USD | 755 | 774,111 | |||||||||
6.125%, 06/01/50 (#) | USD | 590 | 620,606 | |||||||||
1,394,717 | ||||||||||||
Hungary | 3.3% | ||||||||||||
Hungary: | ||||||||||||
5.375%, 02/21/23 | USD | 2,220 | 2,449,631 | |||||||||
5.750%, 11/22/23 | USD | 1,034 | 1,172,944 | |||||||||
3,622,575 | ||||||||||||
Indonesia | 4.8% | ||||||||||||
Indonesia Government Bonds, 8.125%, 05/15/24 | IDR | 71,229,000 | 5,301,525 | |||||||||
Iraq | 2.2% | ||||||||||||
Republic of Iraq: | ||||||||||||
6.752%, 03/09/23 | USD | 1,285 | 1,320,337 | |||||||||
5.800%, 01/15/28 | USD | 1,135 | 1,117,266 | |||||||||
2,437,603 | ||||||||||||
Mexico | 5.7% | ||||||||||||
Mexican Bonos, 10.000%, 12/05/24 | MXN | 107,860 | 6,276,929 | |||||||||
Mozambique | 3.0% | ||||||||||||
Mozambique International Bonds, 10.500%, 01/18/23 | USD | 3,278 | 3,300,536 | |||||||||
Panama | 4.6% | ||||||||||||
Republic of Panama: | ||||||||||||
4.000%, 09/22/24 | USD | 365 | 389,295 | |||||||||
3.750%, 03/16/25 | USD | 1,580 | 1,666,406 | |||||||||
7.125%, 01/29/26 | USD | 550 | 686,125 | |||||||||
8.875%, 09/30/27 | USD | 185 | 262,064 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 29
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
3.875%, 03/17/28 | USD | 820 | $ | 876,888 | ||||||||
4.500%, 05/15/47 | USD | 535 | 603,881 | |||||||||
4.500%, 04/16/50 | USD | 475 | 533,039 | |||||||||
5,017,698 | ||||||||||||
Paraguay | 3.0% | ||||||||||||
Republic of Paraguay: | ||||||||||||
4.700%, 03/27/27 | USD | 1,960 | 2,120,475 | |||||||||
6.100%, 08/11/44 | USD | 485 | 578,059 | |||||||||
5.600%, 03/13/48 | USD | 480 | 543,450 | |||||||||
3,241,984 | ||||||||||||
Peru | 4.3% | ||||||||||||
Republic of Peru: | ||||||||||||
7.350%, 07/21/25 | USD | 265 | 337,958 | |||||||||
4.125%, 08/25/27 | USD | 1,470 | 1,640,428 | |||||||||
2.844%, 06/20/30 | USD | 2,764 | 2,781,966 | |||||||||
4,760,352 | ||||||||||||
Philippines | 4.8% | ||||||||||||
Republic of Philippines, 3.750%, 01/14/29 | USD | 4,840 | 5,275,600 | |||||||||
Qatar | 2.4% | ||||||||||||
State of Qatar, 5.103%, 04/23/48 | USD | 2,230 | 2,657,184 | |||||||||
Russia | 3.5% | ||||||||||||
Russian Foreign Bond - Eurobond: | ||||||||||||
4.375%, 03/21/29 | USD | 800 | 828,000 | |||||||||
4.375%, 03/21/29 (#) | USD | 1,200 | 1,242,000 | |||||||||
5.100%, 03/28/35 (#) | USD | 1,600 | 1,737,600 | |||||||||
3,807,600 | ||||||||||||
Saudi Arabia | 3.4% | ||||||||||||
Saudi Government International Bonds: | ||||||||||||
4.000%, 04/17/25 | USD | 3,115 | 3,320,590 | |||||||||
3.250%, 10/26/26 | USD | 230 | 234,600 | |||||||||
3.625%, 03/04/28 | USD | 135 | 138,578 | |||||||||
3,693,768 |
The accompanying notes are an integral part of these financial statements.
30 Semi-Annual Report
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
Ukraine | 3.3% | ||||||||||||
Ukraine Government Bonds: | ||||||||||||
7.750%, 09/01/21 | USD | 485 | $ | 507,067 | ||||||||
7.750%, 09/01/22 | USD | 85 | 89,888 | |||||||||
8.994%, 02/01/24 | USD | 1,400 | 1,524,600 | |||||||||
7.750%, 09/01/24 | USD | 1,240 | 1,295,180 | |||||||||
7.750%, 09/01/25 | USD | 210 | 217,560 | |||||||||
3,634,295 | ||||||||||||
United Arab Emirates | 3.2% | ||||||||||||
Abu Dhabi Government International Bonds: | ||||||||||||
2.500%, 10/11/22 | USD | 1,250 | 1,262,500 | |||||||||
3.125%, 05/03/26 | USD | 205 | 212,944 | |||||||||
3.125%, 10/11/27 | USD | 2,005 | 2,077,681 | |||||||||
3,553,125 | ||||||||||||
Venezuela | 1.3% | ||||||||||||
Republic of Venezuela: | ||||||||||||
12.750%, 08/23/22 («) | USD | 418 | 83,600 | |||||||||
9.000%, 05/07/23 («) | USD | 613 | 122,600 | |||||||||
8.250%, 10/13/24 («) | USD | 1,174 | 234,800 | |||||||||
7.650%, 04/21/25 («) | USD | 1,273 | 254,600 | |||||||||
11.750%, 10/21/26 («) | USD | 707 | 141,400 | |||||||||
9.250%, 09/15/27 («) | USD | 557 | 111,400 | |||||||||
9.250%, 05/07/28 («) | USD | 551 | 110,200 | |||||||||
11.950%, 08/05/31 («) | USD | 518 | 103,600 | |||||||||
9.375%, 01/13/34 («) | USD | 639 | 127,800 | |||||||||
7.000%, 03/31/38 («) | USD | 851 | 170,200 | |||||||||
1,460,200 | ||||||||||||
Total Foreign Government Obligations (Cost $65,761,110) | 68,419,998 | |||||||||||
Quasi Government Bonds | 0.4% | ||||||||||||
Venezuela | 0.4% | ||||||||||||
Petroleos de Venezuela SA: | ||||||||||||
9.000%, 11/17/21 («) | USD | 280 | 42,000 | |||||||||
6.000%, 05/16/24 («) | USD | 780 | 117,000 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 31
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||
6.000%, 11/15/26 («) | USD | 510 | $ | 76,500 | ||||||||
5.375%, 04/12/27 («) | USD | 315 | 47,250 | |||||||||
9.750%, 05/17/35 («) | USD | 280 | 42,000 | |||||||||
5.500%, 04/12/37 («) | USD | 470 | 70,500 | |||||||||
Total Quasi Government Bonds (Cost $749,618) | 395,250 | |||||||||||
Supranational Bonds | 0.4% | ||||||||||||
Africa Finance Corp., 4.375%, 04/17/26 (#) (Cost $397,103) | USD | 400 | 410,060 | |||||||||
US Treasury Securities | 21.3% | ||||||||||||
US Treasury Bills: | ||||||||||||
0.000%, 07/16/19 | USD | 3,000 | 2,997,418 | |||||||||
0.000%, 07/23/19 | USD | 5,700 | 5,692,758 | |||||||||
0.000%, 07/30/19 | USD | 5,710 | 5,700,380 | |||||||||
0.000%, 08/06/19 | USD | 9,000 | 8,981,662 | |||||||||
Total US Treasury Securities (Cost $23,371,362) | 23,372,218 |
Fair | ||||||||||||
Description | Shares | Value | ||||||||||
Short-Term Investments | 0.2% | ||||||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $221,410) | 221,410 | $ | 221,410 |
The accompanying notes are an integral part of these financial statements.
32 Semi-Annual Report
Notional | ||||||||||||||||||||
Number of | Exercise | Amount | Fair | |||||||||||||||||
Description | Counterparty | Contracts | Price | (000) | Value | |||||||||||||||
Lazard Explorer Total Return Portfolio (continued) | ||||||||||||||||||||
Purchased Options | 0.1% | ||||||||||||||||||||
Call | ||||||||||||||||||||
USD vs AUD Apr 20 1.55, Expires 04/29/20 | GSC | 62,800 | $ | 1.55 | $ | 6,280 | $ | 43,828 | ||||||||||||
USD vs AUD Apr 20 1.55, Expires 04/29/20 | JPMS | 63,700 | 1.55 | 6,370 | 44,456 | |||||||||||||||
USD vs CNH Jul 19 6.87, Expires 07/01/19 | BRC | 56,900 | 6.87 | 5,690 | 11,079 | |||||||||||||||
USD vs CNH Jul 19 6.89, Expires 07/03/19 | JPMS | 42,500 | 6.89 | 4,250 | 9,333 | |||||||||||||||
USD vs EUR Apr 20 0.94, Expires 04/29/20 | JPMS | 102,200 | 0.94 | 10,220 | 22,862 | |||||||||||||||
USD vs EUR Apr 20 0.94, Expires 04/29/20 | GSC | 117,800 | 0.94 | 11,780 | 26,352 | |||||||||||||||
Put | ||||||||||||||||||||
USD vs BRL Jul 19 3.75, Expires 07/10/19 | JPMS | 19,700 | 3.75 | 1,970 | 3,830 | |||||||||||||||
USD vs BRL Jul 19 3.75, Expires 07/12/19 | JPMS | 40,100 | 3.75 | 4,010 | 9,251 | |||||||||||||||
Total Purchased Options (Cost $468,429) | 170,991 | |||||||||||||||||||
Total Investments | 95.4% (Cost $102,779,795) (») | $ | 104,740,275 | ||||||||||||||||||
Cash and Other Assets in Excess of Liabilities | 4.6% | 5,068,248 | |||||||||||||||||||
Net Assets | 100.0% | $ | 109,808,523 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 33
Lazard Explorer Total Return Portfolio (continued)
Forward Currency Contracts open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
BRL | 2,073,973 | USD | 541,196 | BOA | 07/02/19 | $ | — | $ | 1,092 | |||||||||||||
BRL | 2,073,973 | USD | 539,928 | BOA | 08/02/19 | — | 1,360 | |||||||||||||||
BRL | 465,231 | USD | 121,401 | BRC | 07/02/19 | — | 245 | |||||||||||||||
BRL | 1,082,200 | USD | 282,397 | BRC | 07/02/19 | — | 570 | |||||||||||||||
BRL | 2,120,341 | USD | 553,296 | BRC | 07/02/19 | — | 1,117 | |||||||||||||||
BRL | 2,120,341 | USD | 551,540 | BRC | 08/02/19 | — | 931 | |||||||||||||||
BRL | 1,351,204 | USD | 352,592 | CIT | 07/02/19 | — | 712 | |||||||||||||||
BRL | 3,487,786 | USD | 910,126 | GSC | 07/02/19 | — | 1,837 | |||||||||||||||
BRL | 3,487,786 | USD | 907,781 | GSC | 08/02/19 | — | 2,074 | |||||||||||||||
BRL | 33,619 | USD | 8,657 | JPM | 07/02/19 | 98 | — | |||||||||||||||
BRL | 827,198 | USD | 216,346 | JPM | 07/02/19 | — | 927 | |||||||||||||||
BRL | 2,254,522 | USD | 585,438 | JPM | 07/02/19 | 1,685 | — | |||||||||||||||
BRL | 2,280,116 | USD | 591,362 | JPM | 07/02/19 | 2,426 | — | |||||||||||||||
BRL | 2,368,460 | USD | 618,114 | JPM | 07/02/19 | — | 1,320 | |||||||||||||||
BRL | 4,511,538 | USD | 1,167,461 | JPM | 07/02/19 | 7,434 | — | |||||||||||||||
BRL | 5,203,674 | USD | 1,349,641 | JPM | 08/02/19 | 1,647 | — | |||||||||||||||
BRL | 1,428,293 | USD | 373,654 | SCB | 07/02/19 | — | 1,698 | |||||||||||||||
BRL | 4,477,126 | USD | 1,168,291 | SCB | 07/02/19 | — | 2,358 | |||||||||||||||
BRL | 6,653,979 | USD | 1,643,161 | SCB | 07/02/19 | 89,669 | — | |||||||||||||||
BRL | 4,477,126 | USD | 1,165,569 | SCB | 08/02/19 | — | 2,951 | |||||||||||||||
BRL | 2,224,026 | USD | 580,352 | UBS | 07/02/19 | — | 1,171 | |||||||||||||||
BRL | 3,075,838 | USD | 802,630 | UBS | 07/02/19 | — | 1,620 | |||||||||||||||
BRL | 2,224,026 | USD | 578,993 | UBS | 08/02/19 | — | 1,458 | |||||||||||||||
BRL | 3,075,838 | USD | 800,374 | UBS | 08/02/19 | — | 1,642 | |||||||||||||||
COP | 3,507,955,500 | USD | 1,034,978 | UBS | 07/08/19 | 56,427 | — | |||||||||||||||
COP | 626,430,000 | USD | 196,352 | UBS | 07/25/19 | — | 1,710 | |||||||||||||||
CZK | 7,696,452 | EUR | 298,796 | BOA | 07/08/19 | 4,295 | — | |||||||||||||||
CZK | 8,241,615 | EUR | 322,442 | BOA | 09/20/19 | 41 | — | |||||||||||||||
CZK | 5,087,204 | EUR | 197,640 | BRC | 07/08/19 | 2,677 | — | |||||||||||||||
CZK | 29,081,916 | EUR | 1,126,610 | BRC | 07/08/19 | 18,985 | — | |||||||||||||||
CZK | 8,241,615 | EUR | 322,411 | BRC | 09/20/19 | 76 | — | |||||||||||||||
CZK | 8,241,615 | EUR | 322,442 | SCB | 09/20/19 | 41 | — | |||||||||||||||
CZK | 10,152,310 | EUR | 393,546 | UBS | 07/08/19 | 6,339 | — | |||||||||||||||
CZK | 8,241,615 | EUR | 322,432 | UBS | 09/20/19 | 52 | — | |||||||||||||||
CZK | 185,548 | USD | 8,279 | CIT | 07/08/19 | 20 | — | |||||||||||||||
CZK | 13,100,025 | USD | 570,000 | GSC | 07/08/19 | 15,908 | — |
The accompanying notes are an integral part of these financial statements.
34 Semi-Annual Report
Lazard Explorer Total Return Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
EUR | 323,899 | CZK | 8,241,615 | BOA | 07/08/19 | $ | — | $ | 118 | |||||||||||||
EUR | 323,868 | CZK | 8,241,615 | BRC | 07/08/19 | — | 153 | |||||||||||||||
EUR | 500,000 | CZK | 12,934,350 | BRC | 07/08/19 | — | 9,657 | |||||||||||||||
EUR | 240,000 | CZK | 6,117,072 | GSC | 07/08/19 | — | 547 | |||||||||||||||
EUR | 323,899 | CZK | 8,241,615 | SCB | 07/08/19 | — | 118 | |||||||||||||||
EUR | 323,883 | CZK | 8,241,615 | UBS | 07/08/19 | — | 136 | |||||||||||||||
EUR | 18,957 | USD | 21,582 | UBS | 07/22/19 | 9 | — | |||||||||||||||
IDR | 1,413,884,210 | USD | 94,625 | BRC | 11/18/19 | 3,910 | — | |||||||||||||||
IDR | 6,789,600,000 | USD | 480,000 | SCB | 07/17/19 | — | 192 | |||||||||||||||
IDR | 976,705,040 | USD | 65,375 | SCB | 11/18/19 | 2,692 | — | |||||||||||||||
MXN | 14,356,354 | USD | 750,159 | BOA | 07/22/19 | — | 4,621 | |||||||||||||||
MXN | 7,798,235 | USD | 405,198 | BRC | 07/22/19 | — | 229 | |||||||||||||||
MXN | 8,190,629 | USD | 427,537 | CIT | 07/22/19 | — | 2,191 | |||||||||||||||
MXN | 33,142,264 | USD | 1,724,129 | HSB | 07/22/19 | — | 3,022 | |||||||||||||||
MXN | 3,219,980 | USD | 167,383 | SCB | 07/22/19 | — | 167 | |||||||||||||||
MXN | 13,971,761 | USD | 733,218 | UBS | 07/22/19 | — | 7,652 | |||||||||||||||
MYR | 702,300 | USD | 167,342 | SCB | 07/29/19 | 2,540 | — | |||||||||||||||
PLN | 1,649,920 | USD | 436,949 | BOA | 09/24/19 | 5,776 | — | |||||||||||||||
PLN | 1,181,221 | USD | 312,702 | BRC | 09/24/19 | 4,256 | — | |||||||||||||||
PLN | 1,542,383 | USD | 408,389 | CIT | 09/24/19 | 5,481 | — | |||||||||||||||
PLN | 1,600,654 | USD | 423,420 | HSB | 09/24/19 | 6,086 | — | |||||||||||||||
PLN | 1,527,316 | USD | 404,485 | SCB | 09/24/19 | 5,342 | — | |||||||||||||||
PLN | 1,331,461 | USD | 352,583 | UBS | 09/24/19 | 4,690 | — | |||||||||||||||
THB | 1,843,800 | USD | 60,000 | SCB | 09/23/19 | 238 | — | |||||||||||||||
USD | 541,507 | BRL | 2,073,973 | BOA | 07/02/19 | 1,403 | — | |||||||||||||||
USD | 120,355 | BRL | 465,231 | BRC | 07/02/19 | — | 801 | |||||||||||||||
USD | 280,000 | BRL | 1,082,200 | BRC | 07/02/19 | — | 1,827 | |||||||||||||||
USD | 553,108 | BRL | 2,120,341 | BRC | 07/02/19 | 929 | — | |||||||||||||||
USD | 349,645 | BRL | 1,351,204 | CIT | 07/02/19 | — | 2,235 | |||||||||||||||
USD | 910,411 | BRL | 3,487,786 | GSC | 07/02/19 | 2,122 | — | |||||||||||||||
USD | 8,773 | BRL | 33,619 | JPM | 07/02/19 | 18 | — | |||||||||||||||
USD | 215,855 | BRL | 827,198 | JPM | 07/02/19 | 436 | — | |||||||||||||||
USD | 588,310 | BRL | 2,254,522 | JPM | 07/02/19 | 1,187 | — | |||||||||||||||
USD | 594,989 | BRL | 2,280,116 | JPM | 07/02/19 | 1,201 | — | |||||||||||||||
USD | 618,042 | BRL | 2,368,460 | JPM | 07/02/19 | 1,247 | — | |||||||||||||||
USD | 1,177,271 | BRL | 4,511,538 | JPM | 07/02/19 | 2,376 | — |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 35
Lazard Explorer Total Return Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||||
USD | 270,000 | BRL | 1,047,951 | JPM | 08/02/19 | $ | — | $ | 2,131 | |||||||||||||||
USD | 372,708 | BRL | 1,428,293 | SCB | 07/02/19 | 752 | — | |||||||||||||||||
USD | 1,168,962 | BRL | 4,477,126 | SCB | 07/02/19 | 3,029 | — | |||||||||||||||||
USD | 1,736,334 | BRL | 6,653,979 | SCB | 07/02/19 | 3,504 | — | |||||||||||||||||
USD | 580,686 | BRL | 2,224,026 | UBS | 07/02/19 | 1,505 | — | |||||||||||||||||
USD | 802,630 | BRL | 3,075,838 | UBS | 07/02/19 | 1,620 | — | |||||||||||||||||
USD | 290,000 | COP | 954,970,000 | GSC | 07/08/19 | — | 7,113 | |||||||||||||||||
USD | 190,000 | COP | 626,430,000 | SCB | 07/25/19 | — | 4,642 | |||||||||||||||||
USD | 196,562 | COP | 626,430,000 | UBS | 07/08/19 | 1,665 | — | |||||||||||||||||
USD | 590,000 | COP | 1,889,770,000 | UBS | 07/08/19 | 2,049 | — | |||||||||||||||||
USD | 203,081 | CZK | 4,649,799 | BOA | 07/08/19 | — | 4,884 | |||||||||||||||||
USD | 376,919 | CZK | 8,635,774 | BRC | 07/08/19 | — | 9,323 | |||||||||||||||||
USD | 60,000 | CZK | 1,341,504 | SCB | 09/20/19 | — | 61 | |||||||||||||||||
USD | 746,751 | EUR | 657,641 | BOA | 07/22/19 | — | 2,297 | |||||||||||||||||
USD | 746,769 | EUR | 657,642 | BRC | 07/22/19 | — | 2,280 | |||||||||||||||||
USD | 746,440 | EUR | 657,642 | SCB | 07/22/19 | — | 2,609 | |||||||||||||||||
USD | 21,558 | EUR | 18,957 | UBS | 07/08/19 | — | 9 | |||||||||||||||||
USD | 373,431 | IDR | 5,347,529,376 | BOA | 07/15/19 | — | 4,553 | |||||||||||||||||
USD | 248,831 | IDR | 3,568,988,976 | CIT | 07/17/19 | — | 3,382 | |||||||||||||||||
USD | 248,916 | IDR | 3,570,696,976 | GSC | 07/17/19 | — | 3,418 | |||||||||||||||||
USD | 124,513 | IDR | 1,784,017,956 | HSB | 07/15/19 | — | 1,589 | |||||||||||||||||
USD | 373,467 | IDR | 5,351,775,464 | SCB | 07/15/19 | — | 4,818 | |||||||||||||||||
USD | 324,909 | MXN | 6,261,769 | BRC | 07/22/19 | — | 271 | |||||||||||||||||
USD | 2,658,701 | MXN | 51,274,371 | BRC | 07/22/19 | — | 4,023 | |||||||||||||||||
USD | 300,000 | MXN | 5,942,550 | GSC | 07/22/19 | — | 8,602 | |||||||||||||||||
USD | 350,000 | MXN | 6,893,950 | JPM | 07/22/19 | — | 8,009 | |||||||||||||||||
USD | 2,660,218 | MXN | 51,274,371 | SCB | 07/22/19 | — | 2,505 | |||||||||||||||||
USD | 353,651 | MXN | 6,806,569 | UBS | 07/22/19 | 179 | — | |||||||||||||||||
USD | 2,659,528 | MXN | 51,274,371 | UBS | 07/22/19 | — | 3,195 | |||||||||||||||||
USD | 160,000 | MYR | 667,648 | SCB | 07/29/19 | — | 1,499 | |||||||||||||||||
USD | 110,000 | PLN | 410,575 | SCB | 09/24/19 | — | 170 | |||||||||||||||||
USD | 1,164,696 | THB | 36,245,333 | BOA | 09/23/19 | — | 19,463 | |||||||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 274,062 | $ | 161,305 |
The accompanying notes are an integral part of these financial statements.
36 Semi-Annual Report
Lazard Explorer Total Return Portfolio (concluded)
Credit Default Swap Agreements open at June 30, 2019:
Payment | Upfront | |||||||||||||||||||||||||||||
Receive | Frequency | S&P | Premiums | |||||||||||||||||||||||||||
Referenced | Counter- | Notional | Expiration | Buy/ | (Pay) | Paid/ | Credit | Fair | Paid | Unrealized | ||||||||||||||||||||
Obligation | party | Amount | Date | Sell | Rate | Received | Rating | Value | (Received) | Depreciation | ||||||||||||||||||||
Republic of Turkey | GSC | $ | 1,130,000 | 06/20/24 | Buy | (1.000 | )% | Quarterly | NR | $ | 142,843 | $ | 174,045 | $ | 31,202 |
Centrally Cleared Swap Agreements Open at June 30, 2019:
Payment | Upfront | |||||||||||||||||||||||||
Receive | Frequency | Premiums | ||||||||||||||||||||||||
Referenced | Notional | Expiration | Buy/ | (Pay) | Paid/ | Fair | Paid | Unrealized | ||||||||||||||||||
Obligation | Amount | Date | Sell | Rate | Received | Value | (Received) | Depreciation | ||||||||||||||||||
Republic of Turkey | $ | 3,460,000 | 06/20/24 | Buy | (1.000 | )% | Quarterly | $ | 437,484 | $ | 529,498 | $ | 92,014 | |||||||||||||
Republic of South Africa | 5,760,000 | 06/20/24 | Buy | (1.000 | ) | Quarterly | 177,647 | �� | 274,417 | 96,770 | ||||||||||||||||
United Mexican States | 6,307,000 | 06/20/24 | Buy | (1.000 | ) | Quarterly | 30,798 | 103,951 | 73,153 | |||||||||||||||||
Republic of Indonesia | 7,360,000 | 06/20/24 | Buy | (1.000 | ) | Quarterly | 34,823 | 55,771 | 20,948 | |||||||||||||||||
Markit CDX.EM Index | 8,650,000 | 06/20/24 | Buy | (1.000 | ) | Quarterly | 270,322 | 422,496 | 152,174 | |||||||||||||||||
Total Centrally Cleared Swap Agreements | $ | 951,074 | $ | 1,386,133 | $ | 435,059 |
Interest Rate Swap Agreements open at June 30, 2019:
Receive | Payment | |||||||||||||||||||
Counter- | Notional | Expiration | (Pay) | Frequency | Unrealized | |||||||||||||||
Currency | party | Amount | Date | Rate | Paid/Received | Variable Rate | Appreciation | |||||||||||||
BRL | JPM | $ | 12,301,284 | 01/03/22 | 8.69 | % | Upon Maturity | Brazil Cetip Interbank Deposit Rate | $ | 241,987 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 37
The Lazard Funds, Inc.Notes to Portfolio of Investments June 30, 2019 (unaudited)
(#) | Pursuant to Rule 144A under the Securities Act of 1933, these securities may only be traded among “qualified institutional buyers.” At June 30, 2019, the percentage of net assets for each Portfolio was as follows: |
Percentage of | ||||||
Portfolio | Net Assets | |||||
Emerging Markets Income | 2.9 | % | ||||
Enhanced Opportunities | 8.4 | % | ||||
Explorer Total Return | 9.6 | % |
(») | The Portfolio, at all times, maintains portfolio securities in sufficient amount to cover its obligations related to investments in forward currency contracts. |
(*) | Non-income producing security. |
(±) | Some or all of this security position has been pledged to cover collateral requirements on securities sold short. |
(§) | Variable and floating rate securities are securities for which interest rate changes are based on changes in a designated base rate. The rates shown are those in effect on June 30, 2019. |
(¶) | Date shown is the next perpetual call date. |
(«) | Issue in default. |
(Ø) | Step up bonds are securities which increase the interest payment rate at a specified point in time. Rate shown reflects rate in effect at June 30, 2019 which may step up at a future date. |
Security Abbreviations:
ADR | — | American Depositary Receipt | |||
ETF | — | Exchange-Traded Fund | |||
NTN-B | — | Brazil Sovereign “Nota do Tesouro Nacional” Series B | |||
NTN-F | — | Brazil Sovereign “Nota do Tesouro Nacional” Series F | |||
REIT | — | Real Estate Investment Trust | |||
Currency Abbreviations: | |||||
ARS | — | Argentine Peso | KRW | — | South Korean Won |
AUD | — | Australian Dollar | KZT | — | Kazakhstan Tenge |
BRL | — | Brazilian Real | MXN | — | Mexican New Peso |
CAD | — | Canadian Dollar | MYR | — | Malaysian Ringgit |
CLP | — | Chilean Peso | PEN | — | Peruvian Nuevo Sol |
CNH | — | Chinese Yuan Renminbi | PHP | — | Philippine Peso |
CNY | — | Chinese Renminbi | PLN | — | Polish Zloty |
COP | — | Colombian Peso | RUB | — | Russian Ruble |
CZK | — | Czech Koruna | SGD | — | Singapore Dollar |
DOP | — | Dominican Republic Peso | THB | — | Thai Baht |
EGP | — | Egyptian Pound | TRY | — | New Turkish Lira |
EUR | — | Euro | UGX | — | Ugandan Shilling |
HUF | — | Hungarian Forint | USD | — | United States Dollar |
IDR | — | Indonesian Rupiah | UYU | — | Uruguayan Peso |
ILS | — | Israeli Shekel | ZAR | — | South African Rand |
INR | — | Indian Rupee |
The accompanying notes are an integral part of these financial statements.
38 Semi-Annual Report
Counterparty Abbreviations:
BNP | — | BNP Paribas SA | JPM | — | JPMorgan Chase Bank NA |
BOA | — | Bank of America NA | JPMS | — | JPMorgan Securities, Inc. |
BRC | — | Barclays Bank PLC | RBS | — | RBS Securities, Inc. |
CIT | — | Citibank NA | SCB | — | Standard Chartered Bank |
GSC | — | Goldman Sachs International | SSB | — | State Street Bank and Trust Co. |
HSB | — | HSBC Bank USA NA | UBS | — | UBS AG |
Index Abbreviations:
CDX.EM — Credit Derivatives Emerging Markets
Portfolio holdings by industry (as a percentage of net assets), for those Portfolio previously presented by country:
Lazard | |||||
Explorer | |||||
Total Return | |||||
Industry† | Portfolio | ||||
Corporate & Quasi Government Bonds | |||||
Banks | 0.4 | % | |||
Capital Markets | 0.2 | ||||
Chemicals | 0.3 | ||||
Communications Equipment | 1.0 | ||||
Diversified Telecommunication Services | 0.9 | ||||
Electric Utilities | 2.8 | ||||
Independent Power & Renewable Electricity Producers | 0.7 | ||||
Insurance | 0.2 | ||||
Media | 0.3 | ||||
Metals & Mining | 1.2 | ||||
Oil, Gas & Consumable Fuels | 1.8 | ||||
Wireless Telecommunication Services | 1.3 | ||||
Subtotal | 11.1 | ||||
Foreign Government Obligations | 62.3 | ||||
Supranational Bonds | 0.4 | ||||
US Treasury Securities | 21.3 | ||||
Purchased Options | 0.1 | ||||
Short-Term Investments | 0.2 | ||||
Total Investments | 95.4 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 39
Lazard Enhanced | |||||||||
Opportunities Portfolio | |||||||||
Industry† | Long | Short | |||||||
Common, Preferred Stocks and Convertible Corporate Bonds | |||||||||
Aerospace & Defense | 0.9 | % | — | % | |||||
Air Freight & Logistics | 1.8 | –0.8 | |||||||
Banks | 0.9 | –0.1 | |||||||
Biotechnology | 12.0 | –5.6 | |||||||
Capital Markets | 1.3 | –0.8 | |||||||
Chemicals | 0.1 | — | |||||||
Commercial Services & Supplies | 1.4 | –0.6 | |||||||
Construction Materials | 3.5 | — | |||||||
Consumer Finance | 6.4 | –2.3 | |||||||
Diversified Consumer Services | 1.9 | –1.5 | |||||||
Diversified Financial Services | 1.1 | –0.3 | |||||||
Electronic Equipment, Instruments & Components | 5.6 | –2.9 | |||||||
Entertainment | 2.9 | –3.2 | |||||||
Equity Real Estate Investment Trusts (REITs) | 10.1 | –8.3 | |||||||
Health Care Equipment & Supplies | 0.4 | –0.2 | |||||||
Health Care Technology | 5.1 | –1.1 | |||||||
Hotels, Restaurants & Leisure | 1.5 | –0.4 | |||||||
Independent Power & Renewable Electricity Producers | 2.0 | –0.5 | |||||||
Interactive Media & Services | 4.5 | –1.5 | |||||||
Internet & Direct Marketing Retail | 0.4 | –0.3 | |||||||
IT Services | 6.5 | –3.9 | |||||||
Media | 4.6 | –0.3 | |||||||
Metals & Mining | 2.2 | –1.5 | |||||||
Mortgage Real Estate Investment Trusts (REITs) | 0.8 | –0.4 | |||||||
Oil, Gas & Consumable Fuels | 3.2 | –0.8 | |||||||
Personal Products | 1.2 | –0.5 | |||||||
Pharmaceuticals | 10.9 | –4.5 | |||||||
Professional Services | 2.0 | –0.5 | |||||||
Real Estate Management & Development | 1.4 | –0.3 | |||||||
Semiconductors & Semiconductor Equipment | 5.2 | –3.0 | |||||||
Software | 11.9 | –6.1 | |||||||
Technology Hardware, Storage & Peripherals | 0.7 | — | |||||||
Trading Companies & Distributors | 0.6 | –0.1 | |||||||
Wireless Telecommunication Services | 0.6 | –0.1 | |||||||
Subtotal | 115.6 | –52.4 | |||||||
Exchange-Traded Funds | — | –4.2 | |||||||
Short-Term Investments | 39.2 | — | |||||||
Total Investments | 154.8 | % | –56.6 | % |
† | Industry classifications may be different than those used for compliance monitoring purposes. |
The accompanying notes are an integral part of these financial statements.
40 Semi-Annual Report
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Semi-Annual Report 41
The Lazard Funds, Inc.Statements of Assets and Liabilities (unaudited)
June 30, 2019 | Lazard Emerging Markets Income Portfolio | Lazard Enhanced Opportunities Portfolio | ||||||
ASSETS | ||||||||
Investments in securities, at fair value | $ | 5,126,972 | $ | 14,279,696 | ||||
Cash | 200,000 | — | ||||||
Cash collateral due from broker on options & forward contracts | — | 15,500 | ||||||
Foreign currency, at fair value | 114,831 | 138,219 | ||||||
Receivables for: | ||||||||
Investments sold | — | 514,494 | ||||||
Dividends and interest | 28,454 | 75,506 | ||||||
Amount due from Investment Manager (Note 3) | 9,166 | 17,059 | ||||||
Receivable from broker - variation margin on centrally cleared swaps | — | — | ||||||
Gross unrealized appreciation on: | ||||||||
Forward currency contracts | 64,974 | — | ||||||
Swap agreements | — | — | ||||||
Premiums for swap agreements purchased | — | — | ||||||
Prepaid expenses | 19,676 | — | ||||||
Total assets | 5,564,073 | 15,040,474 | ||||||
LIABILITIES | ||||||||
Securities sold short, at fair value | — | 5,216,525 | ||||||
Cash collateral due to broker on options and swap agreements | — | 698 | ||||||
Due to custodian | — | 18,771 | ||||||
Payables for: | ||||||||
Investments purchased | 97,047 | 491,147 | ||||||
Management fees | — | — | ||||||
Accrued custodian fees | 7,421 | 51,430 | ||||||
Accrued professional services | 26,852 | 28,359 | ||||||
Capital stock redeemed | 317 | — | ||||||
Dividends on securities sold short | — | 1,560 | ||||||
Gross unrealized depreciation on: | ||||||||
Forward currency contracts | 18,004 | 6,486 | ||||||
Swap agreements | — | — | ||||||
Other accrued expenses and payables | 5,430 | 2,526 | ||||||
Total liabilities | 155,071 | 5,817,502 | ||||||
Net assets | $ | 5,409,002 | $ | 9,222,972 | ||||
NET ASSETS | ||||||||
Paid in capital | $ | 5,463,924 | $ | 9,937,659 | ||||
Distributable earnings (Accumulated loss) | (54,922 | ) | (714,687 | ) | ||||
Net assets | $ | 5,409,002 | $ | 9,222,972 |
The accompanying notes are an integral part of these financial statements.
42 Semi-Annual Report
Lazard Explorer Total Return Portfolio | ||||
$ | 104,740,275 | |||
— | ||||
816,240 | ||||
1,273,503 | ||||
3,889,127 | ||||
940,484 | ||||
— | ||||
128,571 | ||||
274,062 | ||||
241,987 | ||||
174,045 | ||||
28,074 | ||||
112,506,368 | ||||
— | ||||
78,344 | ||||
700,000 | ||||
1,580,920 | ||||
61,988 | ||||
35,588 | ||||
32,045 | ||||
3,774 | ||||
— | ||||
161,305 | ||||
31,202 | ||||
4,152 | ||||
2,689,318 | ||||
$ | 109,817,050 | |||
$ | 133,379,988 | |||
(23,562,938 | ) | |||
$ | 109,817,050 |
Semi-Annual Report 43
June 30, 2019 | Lazard Emerging Markets Income Portfolio | Lazard Enhanced Opportunities Portfolio | ||||||
Institutional Shares | ||||||||
Net assets | $ | 5,241,235 | $ | 9,069,771 | ||||
Shares of capital stock outstanding* | 690,408 | 1,030,241 | ||||||
Net asset value, offering and redemption price per share | $ | 7.59 | $ | 8.80 | ||||
Open Shares | ||||||||
Net assets | $ | 167,767 | $ | 153,201 | ||||
Shares of capital stock outstanding* | 20,074 | 17,435 | ||||||
Net asset value, offering and redemption price per share | $ | 8.36 | $ | 8.79 | ||||
Cost of investments in securities | $ | 5,101,066 | $ | 13,866,598 | ||||
Proceeds received from securities sold short | $ | — | $ | 4,875,860 | ||||
Cost of foreign currency | $ | 114,666 | $ | 138,219 |
*$0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total.
The accompanying notes are an integral part of these financial statements.
44 Semi-Annual Report
Lazard Explorer Total Return Portfolio | ||||
$ | 109,724,181 | |||
13,326,969 | ||||
$ | 8.23 | |||
$ | 92,869 | |||
11,173 | ||||
$ | 8.31 | |||
$ | 102,779,795 | |||
$ | — | |||
$ | 1,273,224 |
Semi-Annual Report 45
The Lazard Funds, Inc.Statements of Operations (unaudited)
For the Six Months Ended June 30, 2019 | Lazard Emerging Markets Income Portfolio | Lazard Enhanced Opportunities Portfolio | ||||||
Investment Income (Loss) | ||||||||
Income | ||||||||
Interest* | $ | 127,371 | $ | 238,701 | ||||
Dividends | — | 709 | ||||||
Total investment income* | 127,371 | 239,410 | ||||||
Expenses | ||||||||
Management fees (Note 3) | 17,069 | 54,054 | ||||||
Custodian fees | 21,423 | 101,407 | ||||||
Professional services | 20,594 | 21,758 | ||||||
Registration fees | 17,213 | 17,758 | ||||||
Administration fees | 7,691 | 8,074 | ||||||
Directors’ fees and expenses | 2,601 | 2,872 | ||||||
Shareholders’ services | 2,757 | 2,856 | ||||||
Shareholders’ reports | 1,794 | 2,295 | ||||||
Distribution fees (Open Shares) | 178 | 149 | ||||||
Other^ | 2,704 | 2,867 | ||||||
Total gross expenses before expenses on securities sold short | 94,024 | 214,090 | ||||||
Broker expense on securities sold short | — | 72,930 | ||||||
Dividend expense on securities sold short | — | 23,468 | ||||||
Total gross expenses | 94,024 | 310,488 | ||||||
Management fees waived and expenses reimbursed | (70,650 | ) | (142,777 | ) | ||||
Total net expenses | 23,374 | 167,711 | ||||||
Net investment income (loss) | 103,997 | 71,699 | ||||||
Net Realized and Unrealized Gain (Loss) on Investments, Securities Sold Short, Foreign Currency Transactions, Forward Currency Contracts, Futures Contracts, Options and Swap Agreements | ||||||||
Net realized gain (loss) on: | ||||||||
Investments** | (97,976 | ) | 232,514 | |||||
Securities sold short | — | (305,995 | ) | |||||
Foreign currency transactions | (1,373 | ) | (60 | ) | ||||
Forward currency contracts | 50,552 | (2,573 | ) | |||||
Futures contracts | — | — | ||||||
Written options | — | 20,085 | ||||||
Swap agreements | — | — | ||||||
Total net realized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts, options and swap agreements | (48,797 | ) | (56,029 | ) |
The accompanying notes are an integral part of these financial statements.
46 Semi-Annual Report
Lazard Explorer Total Return Portfolio | ||||
$ | 2,962,025 | |||
— | ||||
2,962,025 | ||||
493,739 | ||||
73,227 | ||||
26,257 | ||||
18,372 | ||||
14,339 | ||||
5,189 | ||||
3,547 | ||||
2,880 | ||||
118 | ||||
4,925 | ||||
642,593 | ||||
— | ||||
— | �� | |||
642,593 | ||||
(44,673 | ) | |||
597,920 | ||||
2,364,105 | ||||
(1,527,063 | ) | |||
— | ||||
(11,647 | ) | |||
399,309 | ||||
(9,190 | ) | |||
191,289 | ||||
(265,883 | ) | |||
(1,223,185 | ) |
Semi-Annual Report 47
For the Six Months Ended June 30, 2019 | Lazard Emerging Markets Income Portfolio | Lazard Enhanced Opportunities Portfolio | |||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||
Investments | $ | 196,947 | $ | 1,677,095 | |||||
Securities sold short | — | (1,021,352 | ) | ||||||
Foreign currency translations | 860 | 311 | |||||||
Forward currency contracts | 1,834 | 55 | |||||||
Written options | — | (274 | ) | ||||||
Swap agreements | — | — | |||||||
Total net change in unrealized appreciation (depreciation) on investments, securities sold short, foreign currency translations, forward currency contracts, options and swap agreements | 199,641 | 655,835 | |||||||
Net realized and unrealized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts, options and swap agreements | 150,844 | 599,806 | |||||||
Net increase (decrease) in net assets resulting from operations | $ | 254,841 | $ | 671,505 | |||||
* Net of foreign withholding taxes of | $ | — | $ | (234 | ) | ||||
** Net of foreign capital gains taxes of | $ | — | $ | — | |||||
^ Includes interest on line of credit of | $ | 2 | $ | — |
The accompanying notes are an integral part of these financial statements.
48 Semi-Annual Report
Lazard Explorer Total Return Portfolio | ||||
$ | 8,118,113 | |||
— | ||||
(1,529 | ) | |||
(409,084 | ) | |||
18,966 | ||||
(439,668 | ) | |||
7,286,798 | ||||
6,063,613 | ||||
$ | 8,427,718 | |||
$ | 6,160 | |||
$ | 310 | |||
$ | 299 |
Semi-Annual Report 49
The Lazard Funds, Inc.Statements of Changes in Net Assets (unaudited)
Lazard Emerging Markets Income Portfolio | ||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||
Increase (Decrease) in Net Assets | ||||||||||
Operations | ||||||||||
Net investment income (loss) | $ | 103,997 | $ | 223,104 | ||||||
Net realized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts, options and swap agreements | (48,797 | ) | (314,757 | ) | ||||||
Net change in unrealized appreciation (depreciation) on investments, securities sold short, foreign currency translations, forward currency contracts, options and swap agreements | 199,641 | (218,974 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | 254,841 | (310,627 | ) | |||||||
Distributions to shareholders (Note 2(i)) | ||||||||||
Institutional Shares | (101,260 | ) | (538,715 | ) | ||||||
Open Shares | — | (8,027 | ) | |||||||
Return of capital | ||||||||||
Institutional Shares | — | (215,126 | ) | |||||||
Open Shares | — | (3,206 | ) | |||||||
Net decrease in net assets resulting from distributions | (101,260 | ) | (765,074 | ) | ||||||
Capital stock transactions | ||||||||||
Net proceeds from sales | ||||||||||
Institutional Shares | 100,015 | 353,037 | ||||||||
Open Shares | 50,316 | 40,296 | ||||||||
Net proceeds from reinvestment of distributions | ||||||||||
Institutional Shares | 101,260 | 753,834 | ||||||||
Open Shares | — | 11,233 | ||||||||
Cost of shares redeemed | ||||||||||
Institutional Shares | (165,674 | ) | (917,500 | ) | ||||||
Open Shares | — | (29,858 | ) | |||||||
Net increase (decrease) in net assets from capital stock transactions | 85,917 | 211,042 | ||||||||
Total increase (decrease) in net assets | 239,498 | (864,659 | ) | |||||||
Net assets at beginning of period | 5,169,504 | 6,034,163 | ||||||||
Net assets at end of period | $ | 5,409,002 | $ | 5,169,504 |
The accompanying notes are an integral part of these financial statements.
50 Semi-Annual Report
Lazard Enhanced Opportunities Portfolio | Lazard Explorer Total Return Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
$ | 71,699 | $ | 129,042 | $ | 2,364,105 | $ | 7,356,460 | |||||||||
(56,029 | ) | 414,280 | (1,223,185 | ) | (13,671,481 | ) | ||||||||||
655,835 | (826,012 | ) | 7,286,798 | (9,184,201 | ) | |||||||||||
671,505 | (282,690 | ) | 8,427,718 | (15,499,222 | ) | |||||||||||
— | (425,197 | ) | (2,262,169 | ) | (6,311,065 | ) | ||||||||||
— | (2,387 | ) | (1,818 | ) | (10,083 | ) | ||||||||||
— | — | — | (833,996 | ) | ||||||||||||
— | — | — | (1,333 | ) | ||||||||||||
— | (427,584 | ) | (2,263,987 | ) | (7,156,477 | ) | ||||||||||
1,296,608 | 4,469,209 | 507,492 | 6,934,144 | |||||||||||||
41,744 | 7 | 1,788 | 8,549 | |||||||||||||
— | 415,898 | 2,251,636 | 7,088,834 | |||||||||||||
— | 2,387 | 1,818 | 11,416 | |||||||||||||
(9,075,438 | ) | (3,201,293 | ) | (6,469,152 | ) | (126,158,624 | ) | |||||||||
— | (10,796 | ) | (11,112 | ) | (889,813 | ) | ||||||||||
(7,737,086 | ) | 1,675,412 | (3,717,530 | ) | (113,005,494 | ) | ||||||||||
(7,065,581 | ) | 965,138 | 2,446,201 | (135,661,193 | ) | |||||||||||
16,288,553 | 15,323,415 | 107,370,849 | 243,032,042 | |||||||||||||
$ | 9,222,972 | $ | 16,288,553 | $ | 109,817,050 | $ | 107,370,849 |
Semi-Annual Report 51
Lazard Emerging Markets Income Portfolio | |||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | ||||||||
Shares issued and redeemed | |||||||||
Institutional Shares | |||||||||
Shares outstanding at beginning of period | 685,762 | 648,255 | |||||||
Shares sold | 13,212 | 39,351 | |||||||
Shares issued to shareholders from reinvestment of distributions | 13,499 | 98,805 | |||||||
Shares redeemed | (22,065 | ) | (100,649 | ) | |||||
Net increase (decrease) | 4,646 | 37,507 | |||||||
Shares outstanding at end of period | 690,408 | 685,762 | |||||||
Open Shares | |||||||||
Shares outstanding at beginning of period | 13,908 | 11,589 | |||||||
Shares sold | 6,166 | 4,177 | |||||||
Shares issued to shareholders from reinvestment of distributions | — | 1,424 | |||||||
Shares redeemed | — | (3,282 | ) | ||||||
Net increase (decrease) | 6,166 | 2,319 | |||||||
Shares outstanding at end of period | 20,074 | 13,908 |
The accompanying notes are an integral part of these financial statements.
52 Semi-Annual Report
Lazard Enhanced Opportunities Portfolio | Lazard Explorer Total Return Portfolio | ||||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | ||||||||||||||
1,948,553 | 1,754,786 | 13,774,341 | 26,808,845 | ||||||||||||||
153,255 | 512,981 | 62,159 | 803,468 | ||||||||||||||
— | 51,342 | 275,997 | 840,498 | ||||||||||||||
(1,071,567 | ) | (370,556 | ) | (785,528 | ) | (14,678,470 | ) | ||||||||||
(918,312 | ) | 193,767 | (447,372 | ) | (13,034,504 | ) | |||||||||||
1,030,241 | 1,948,553 | 13,326,969 | 13,774,341 | ||||||||||||||
12,624 | 13,575 | 12,090 | 109,240 | ||||||||||||||
4,811 | 1 | 219 | 979 | ||||||||||||||
— | 289 | 222 | 1,314 | ||||||||||||||
— | (1,241 | ) | (1,358 | ) | (99,443 | ) | |||||||||||
4,811 | (951 | ) | (917 | ) | (97,150 | ) | |||||||||||
17,435 | 12,624 | 11,173 | 12,090 |
Semi-Annual Report 53
The Lazard Funds, Inc.Financial Highlights (unaudited)
LAZARD EMERGING MARKETS INCOME PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | For the Period 4/30/14* to | |||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.38 | $ | 9.14 | $ | 8.40 | $ | 8.42 | $ | 9.16 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.15 | 0.34 | 0.19 | 0.16 | 0.01 | 0.01 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.21 | (0.87 | ) | 0.79 | 0.08 | (0.74 | ) | (0.85 | ) | |||||||||||||||
Total from investment operations | 0.36 | (0.53 | ) | 0.98 | 0.24 | (0.73 | ) | (0.84 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.15 | ) | (0.90 | ) | (0.20 | ) | (0.16 | ) | — | — | ||||||||||||||
Net realized gains | — | — | (0.04 | ) | (0.10 | ) | — | — | ||||||||||||||||
Return of capital | — | (0.33 | ) | — | — | (0.01 | ) | — | ||||||||||||||||
Total distributions | (0.15 | ) | (1.23 | ) | (0.24 | ) | (0.26 | ) | (0.01 | ) | — | |||||||||||||
Net asset value, end of period | $ | 7.59 | $ | 7.38 | $ | 9.14 | $ | 8.40 | $ | 8.42 | $ | 9.16 | ||||||||||||
Total Return (b) | 4.88 | % | –5.79 | % | 11.73 | % | 2.82 | % | –7.94 | % | –8.30 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 5,241 | $ | 5,059 | $ | 5,925 | $ | 12,156 | $ | 12,800 | $ | 4,985 | ||||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||||||
Net expenses | 0.89 | % | 0.90 | % | 0.90 | % | 0.90 | % | 0.90 | % | 0.90 | % | ||||||||||||
Gross expenses | 3.52 | % | 3.79 | % | 2.13 | % | 2.25 | % | 2.55 | % | 5.15 | % | ||||||||||||
Net investment income (loss) | 3.96 | % | 4.06 | % | 2.17 | % | 1.80 | % | 0.09 | % | 0.10 | % | ||||||||||||
Portfolio turnover rate | 37 | % | 65 | % | 74 | % | 174 | % | 175 | % | 125 | % |
The accompanying notes are an integral part of these financial statements.
54 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | For the Period 4/30/14* to | |||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.97 | $ | 9.43 | $ | 8.50 | $ | 8.39 | $ | 9.14 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.16 | 0.35 | 0.18 | 0.13 | (0.02 | ) | (0.01 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) | 0.23 | (0.92 | ) | 0.79 | 0.08 | (0.73 | ) | (0.85 | ) | |||||||||||||||
Total from investment operations | 0.39 | (0.57 | ) | 0.97 | 0.21 | (0.75 | ) | (0.86 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.65 | ) | — | — | — | — | |||||||||||||||||
Net realized gains | — | — | (0.04 | ) | (0.10 | ) | — | — | ||||||||||||||||
Return of capital | — | (0.24 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (0.89 | ) | (0.04 | ) | (0.10 | ) | — | — | |||||||||||||||
Net asset value, end of period | $ | 8.36 | $ | 7.97 | $ | 9.43 | $ | 8.50 | $ | 8.39 | $ | 9.14 | ||||||||||||
Total Return (b) | 4.89 | % | –5.97 | % | 11.42 | % | 2.52 | % | –8.21 | % | –8.50 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 168 | $ | 111 | $ | 109 | $ | 128 | $ | 155 | $ | 132 | ||||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||||||
Net expenses | 1.03 | % | 1.05 | % | 1.13 | % | 1.20 | % | 1.20 | % | 1.20 | % | ||||||||||||
Gross expenses | 5.66 | % | 13.51 | % | 12.51 | % | 12.29 | % | 12.19 | % | 13.96 | % | ||||||||||||
Net investment income (loss) | 3.84 | % | 3.95 | % | 1.96 | % | 1.51 | % | –0.18 | % | –0.18 | % | ||||||||||||
Portfolio turnover rate | 37 | % | 65 | % | 74 | % | 174 | % | 175 | % | 125 | % |
† | Unaudited. |
* | The Portfolio commenced operations on April 30, 2014. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 55
LAZARD ENHANCED OPPORTUNITIES PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | For the Period 12/31/14* to | |||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.31 | $ | 8.67 | $ | 9.16 | $ | 8.89 | $ | 10.00 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.05 | 0.06 | 0.11 | ^ | 0.05 | (0.02 | ) | — | (b) | |||||||||||||||
Net realized and unrealized gain (loss) | 0.44 | (0.20 | ) | 0.40 | 0.35 | (0.21 | ) | — | (b) | |||||||||||||||
Total from investment operations | 0.49 | (0.14 | ) | 0.51 | 0.40 | (0.23 | ) | — | (b) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.10 | ) | (0.17 | ) | (0.08 | ) | (0.14 | ) | — | ||||||||||||||
Net realized gains | — | (0.12 | ) | (0.83 | ) | (0.05 | ) | (0.35 | ) | — | ||||||||||||||
Return of capital | — | — | — | — | (0.39 | ) | — | |||||||||||||||||
Total distributions | — | (0.22 | ) | (1.00 | ) | (0.13 | ) | (0.88 | ) | — | ||||||||||||||
Net asset value, end of period | $ | 8.80 | $ | 8.31 | $ | 8.67 | $ | 9.16 | $ | 8.89 | $ | 10.00 | ||||||||||||
Total Return (c) | 5.90 | % | –1.66 | % | 5.56 | %^ | 4.50 | % | –2.32 | % | 0.00 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 9,070 | $ | 16,184 | $ | 15,206 | $ | 14,077 | $ | 4,823 | $ | 4,899 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 2.94 | % | 2.36 | % | 2.78 | %^ | 1.79 | % | 1.70 | % | 1.70 | % | ||||||||||||
Gross expenses | 5.43 | % | 3.80 | % | 5.02 | %^ | 3.60 | % | 13.45 | % | 69.35 | %(e) | ||||||||||||
Gross expenses, excluding expenses on securities sold short | 3.73 | % | 2.71 | % | 3.45 | % | 3.51 | % | 13.45 | % | 69.35 | %(e) | ||||||||||||
Net investment income (loss) | 1.26 | % | 0.73 | % | 1.20 | % | 0.57 | % | –0.22 | % | –1.70 | % | ||||||||||||
Portfolio turnover rate: | ||||||||||||||||||||||||
Excluding securities sold short | 298 | % | 312 | % | 210 | % | 247 | % | 639 | % | 37 | % | ||||||||||||
Including securities sold short | 303 | % | 409 | % | 310 | % | 340 | % | — | % | — | % |
The accompanying notes are an integral part of these financial statements.
56 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | For the Period 12/31/14* to | |||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.30 | $ | 8.65 | $ | 9.15 | $ | 8.89 | $ | 10.00 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.05 | 0.04 | 0.10 | ^ | 0.04 | (0.05 | ) | — | (b) | |||||||||||||||
Net realized and unrealized gain (loss) | 0.44 | (0.19 | ) | 0.37 | 0.33 | (0.21 | ) | — | (b) | |||||||||||||||
Total from investment operations | 0.49 | (0.15 | ) | 0.47 | 0.37 | (0.26 | ) | — | (b) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.08 | ) | (0.14 | ) | (0.06 | ) | (0.11 | ) | — | ||||||||||||||
Net realized gains | — | (0.12 | ) | (0.83 | ) | (0.05 | ) | (0.35 | ) | — | ||||||||||||||
Return of capital | — | — | — | — | (0.39 | ) | — | |||||||||||||||||
Total distributions | — | (0.20 | ) | (0.97 | ) | (0.11 | ) | (0.85 | ) | — | ||||||||||||||
Net asset value, end of period | $ | 8.79 | $ | 8.30 | $ | 8.65 | $ | 9.15 | $ | 8.89 | $ | 10.00 | ||||||||||||
Total Return (c) | 5.78 | % | –1.80 | % | 5.16 | %^ | 4.13 | % | –2.57 | % | 0.00 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 153 | $ | 105 | $ | 117 | $ | 112 | $ | 110 | $ | 100 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 3.22 | % | 2.60 | % | 3.01 | %^ | 2.07 | % | 1.95 | % | 1.95 | % | ||||||||||||
Gross expenses | 8.14 | % | 14.49 | % | 16.40 | %^ | 15.58 | % | 26.46 | % | 69.36 | %(e) | ||||||||||||
Gross expenses, excluding expenses on securities sold short | 6.42 | % | 13.40 | % | 14.85 | % | 15.46 | % | 26.46 | % | 69.36 | %(e) | ||||||||||||
Net investment income (loss) | 1.13 | % | 0.48 | % | 1.06 | % | 0.45 | % | –0.46 | % | –1.95 | % | ||||||||||||
Portfolio turnover rate: | ||||||||||||||||||||||||
Excluding securities sold short | 298 | % | 312 | % | 210 | % | 247 | % | 639 | % | 37 | % | ||||||||||||
Including securities sold short | 303 | % | 409 | % | 310 | % | 340 | % | — | % | — | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 57
LAZARD ENHANCED OPPORTUNITIES PORTFOLIO
† | Unaudited. |
* | The Portfolio commenced operations on December 31, 2014. |
^ | A one-time voluntary reimbursement by the administrator increased the net investment income per share amount of $0.04 per share. For Institutional Shares and Open Shares, the one-time voluntary reimbursement by the administrator increased the total return ratio by 0.49%, decreased the gross expense and net expense ratios by 0.44% and increased the net investment income (loss) ratio by 0.44%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
(e) | Gross expense ratio was the result of the Portfolio being in existence for one day during the period ended December 31, 2014. |
The accompanying notes are an integral part of these financial statements.
58 Semi-Annual Report
LAZARD EXPLORER TOTAL RETURN PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | |||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | |||||||||||||||||||
Institutional Shares | |||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.79 | $ | 9.03 | $ | 8.77 | $ | 8.56 | $ | 9.32 | $ | 9.86 | |||||||||||||
Income (Loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) (a) | 0.17 | 0.40 | 0.31 | 0.42 | 0.28 | 0.36 | |||||||||||||||||||
Net realized and unrealized gain (loss) | 0.43 | (1.25 | ) | 0.24 | �� | 0.21 | (0.75 | ) | (0.38 | ) | |||||||||||||||
Total from investment operations | 0.60 | (0.85 | ) | 0.55 | 0.63 | (0.47 | ) | (0.02 | ) | ||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | (0.16 | ) | (0.35 | ) | (0.22 | ) | (0.19 | ) | (0.15 | ) | (0.49 | ) | |||||||||||||
Net realized gains | — | — | — | — | — | (0.01 | ) | ||||||||||||||||||
Return of capital | — | (0.04 | ) | (0.07 | ) | (0.23 | ) | (0.14 | ) | (0.02 | ) | ||||||||||||||
Total distributions | (0.16 | ) | (0.39 | ) | (0.29 | ) | (0.42 | ) | (0.29 | ) | (0.52 | ) | |||||||||||||
Redemption fees | — | — | — | — | — | — | (b) | ||||||||||||||||||
Net asset value, end of period | $ | 8.23 | $ | 7.79 | $ | 9.03 | $ | 8.77 | $ | 8.56 | $ | 9.32 | |||||||||||||
Total Return (c) | 7.78 | % | –9.65 | % | 6.41 | % | 7.47 | % | –5.13 | % | –0.21 | % | |||||||||||||
Ratios and Supplemental Data: | |||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 109,716 | $ | 107,276 | $ | 242,040 | $ | 256,331 | $ | 249,222 | $ | 133,473 | |||||||||||||
Ratios to average net assets (d): | |||||||||||||||||||||||||
Net expenses | 1.09 | % | 1.10 | % | 1.06 | % | 1.12 | % | 1.16 | % | 1.24 | % | |||||||||||||
Gross expenses | 1.15 | % | 1.10 | % | 1.06 | % | 1.12 | % | 1.16 | % | 1.30 | % | |||||||||||||
Net investment income (loss) | 4.24 | % | 4.64 | % | 3.45 | % | 4.80 | % | 3.17 | % | 3.57 | % | |||||||||||||
Portfolio turnover rate | 100 | % | 151 | % | 152 | % | 173 | % | 262 | % | 182 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 59
LAZARD EXPLORER TOTAL RETURN PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | |||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | |||||||||||||||||||
Open Shares | |||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.83 | $ | 9.08 | $ | 8.82 | $ | 8.61 | $ | 9.37 | $ | 9.88 | |||||||||||||
Income (Loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) (a) | 0.16 | 0.35 | 0.28 | 0.39 | 0.24 | 0.33 | |||||||||||||||||||
Net realized and unrealized gain (loss) | 0.45 | (1.24 | ) | 0.24 | 0.21 | (0.75 | ) | (0.38 | ) | ||||||||||||||||
Total from investment operations | 0.61 | (0.89 | ) | 0.52 | 0.60 | (0.51 | ) | (0.05 | ) | ||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | (0.16 | ) | (0.32 | ) | (0.20 | ) | (0.17 | ) | (0.12 | ) | (0.43 | ) | |||||||||||||
Net realized gains | — | — | — | — | — | (0.01 | ) | ||||||||||||||||||
Return of capital | — | (0.04 | ) | (0.06 | ) | (0.22 | ) | (0.14 | ) | (0.02 | ) | ||||||||||||||
Total distributions | (0.16 | ) | (0.36 | ) | (0.26 | ) | (0.39 | ) | (0.26 | ) | (0.46 | ) | |||||||||||||
Redemption fees | — | — | — | — | 0.01 | — | (b) | ||||||||||||||||||
Net asset value, end of period | $ | 8.28 | $ | 7.83 | $ | 9.08 | $ | 8.82 | $ | 8.61 | $ | 9.37 | |||||||||||||
Total Return (c) | 7.77 | % | –9.97 | % | 6.02 | % | 7.07 | % | –5.42 | % | –0.52 | % | |||||||||||||
Ratios and Supplemental Data: | |||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 92 | $ | 95 | $ | 992 | $ | 1,176 | $ | 1,342 | $ | 7,150 | |||||||||||||
Ratios to average net assets (d): | |||||||||||||||||||||||||
Net expenses | 0.59 | % | 1.40 | % | 1.42 | % | 1.48 | % | 1.50 | % | 1.54 | % | |||||||||||||
Gross expenses | 3.54 | % | 5.22 | % | 2.36 | % | 2.34 | % | 1.66 | % | 1.78 | % | |||||||||||||
Net investment income (loss) | 3.94 | % | 3.94 | % | 3.09 | % | 4.46 | % | 2.62 | % | 3.26 | % | |||||||||||||
Portfolio turnover rate | 100 | % | 151 | % | 152 | % | 173 | % | 262 | % | 182 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
60 Semi-Annual Report
The Lazard Funds, Inc.Notes to Financial Statements June 30, 2019 (unaudited)
1. Organization
The Lazard Funds, Inc. (the “Fund”) was incorporated in Maryland on May 17, 1991 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. As of December 31, 2018, the Fund was comprised of thirty-two no-load portfolios (each referred to as a “Portfolio”). This report includes only the financial statements of Emerging Markets Income, Enhanced Opportunities and Explorer Total Return Portfolios. The financial statements of the other twenty-nine Portfolios are presented separately. The financial statements of other Portfolios are presented separately.
The Portfolios are operated as “non-diversified” funds, as defined in the 1940 Act.
Each Portfolio currently offers Institutional Shares and Open Shares, and certain Portfolios offer R6 Shares. Each share class is identical except as to minimum investment requirements; eligibility requirements for R6 Shares; the services offered to, and expenses borne by, each class; and the availability of Service Payments (as defined in the Portfolios’ Prospectus).
2. Significant Accounting Policies
The accompanying financial statements are presented in conformity with US Generally Accepted Accounting Principles (“GAAP”). The Fund is an investment company and therefore applies specialized accounting guidance in accordance with Accounting Standards Codification Topic 946. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of the financial statements:
(a) Valuation of Investments—Equity securities traded on a securities exchange or market, including exchange-traded option contracts, rights and warrants, are valued at the last reported sales price (for domestic equity securities) or the closing price (for foreign equity securities) on the exchange or market on which the security is principally traded or, for securities trading on the NASDAQ National Market System (“NASDAQ”), the NASDAQ Official Closing Price. If there is no available closing price for a foreign equity security, the last reported sales price is used. If there are no
Semi-Annual Report 61
reported sales of a security on the valuation date, the security is valued at the most recent quoted bid price on such date reported by such principal exchange or market. Exchange-traded futures contracts are valued at the settlement price on the exchange on which the contract is principally traded. Swap agreements, such as credit default, interest rate and total return swap agreements, generally are valued by an independent pricing service. Forward currency contracts generally are valued using quotations from an independent pricing service. Investments in money market funds are valued at the fund’s net asset value (“NAV”) per share.
Bonds and other fixed-income securities that are not exchange-traded are valued on the basis of prices provided by independent pricing services which are based on, among other things, trading in securities with similar characteristics, brokers’ quotations and/or a matrix system which considers such factors as other security prices, yields and maturities.
Calculation of a Portfolio’s NAV may not take place contemporaneously with the determination of the prices of portfolio assets used in such calculation. Trading on Europe, Latin and South America and Far East securities exchanges and in over-the-counter markets ordinarily is completed well before the close of business on each business day in New York (i.e.,a day on which the New York Stock Exchange (the “NYSE”) is open). In addition, European or Far Eastern securities trading generally, or in a particular country or countries, may not take place on all business days in New York and on which the NAV of a Portfolio is calculated.
The Valuation Committee of Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), which meets periodically under the direction of the Board of Directors (the “Board”), may evaluate a variety of factors to determine the fair value of securities for which market quotations are determined not to be readily available or reliable. These factors include, but are not limited to, the type of security, the value of comparable securities, observations from financial institutions and relevant news events. Input from the Investment Manager’s portfolio managers/analysts also will be considered.
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If a significant event materially affecting the value of securities occurs between the close of the exchange or market on which the security is principally traded and the time when a Portfolio’s NAV is calculated, or when current market quotations otherwise are determined not to be readily available or reliable (including restricted or other illiquid securities such as certain derivative instruments), such securities will be valued at their fair value as determined by, or in accordance with procedures approved by, the Board. The fair value of non-US securities may be determined with the assistance of an independent pricing service using correlations between the movement of prices of such securities and indices of US securities and other appropriate indicators, such as closing market prices of relevant American Depositary Receipts (“ADRs”) or futures contracts. Non-US securities may trade on days when a Portfolio is not open for business, thus affecting the value of the Portfolio’s assets on days when Portfolio shareholders may not be able to buy or sell Portfolio shares.
The effect of using fair value pricing is that the NAV of a Portfolio will reflect the affected securities’ values as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price securities may result in a value that is different from the most recent closing price of a security and from the prices used by other investment companies to calculate their portfolios’ NAVs.
(b) Portfolio Securities Transactions and Investment Income—Portfolio securities transactions are accounted for on trade date. Realized gain (loss) on sales of investments are recorded on a specific identification basis. Dividend income and dividend expenses on short sales are recorded on the ex-dividend date except for certain dividends from non-US securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by a Portfolio. Interest income, if any, is accrued daily. A Portfolio amortizes premiums and accretes discounts on fixed-income securities using the effective yield method.
A Portfolio may be subject to taxes imposed by non-US countries in which it invests. Such taxes are generally based upon income
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earned or capital gains (realized and/or unrealized). An affected Portfolio accrues and applies such taxes to net investment income, net realized gains and net unrealized gains concurrent with the recognition of income earned or capital gains (realized and/or unrealized) from the applicable portfolio securities.
(c) Foreign Currency Translation and Forward Currency Contracts—The accounting records of the Fund are maintained in US dollars. Portfolio securities and other assets and liabilities denominated in a foreign currency are translated daily into US dollars at the prevailing rates of exchange. Purchases and sales of securities, income receipts and expense payments are translated into US dollars at the prevailing exchange rates on the respective transaction dates.
The Portfolios do not isolate the portion of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in their market prices. Such fluctuations are included in net realized and unrealized gain (loss) on investments. Net realized gain (loss) on foreign currency transactions and forward currency contracts represent net foreign currency gain (loss) from forward currency contracts, disposition of foreign currencies, currency gain (loss) realized between the trade and settlement dates on securities transactions, and the difference between the amount of dividends, interest and foreign withholding taxes recorded on the Portfolios’ accounting records and the US dollar equivalent amounts actually received or paid. Net change in unrealized appreciation (depreciation) on foreign currency translations reflects the impact of changes in exchange rates on the value of assets and liabilities, other than investments in securities, during the period.
A forward currency contract is an agreement between two parties to buy or sell currency at a set price on a future date. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of the foreign currency relative to the US dollar.
The US dollar value of forward currency contracts is determined using quotations provided by an independent pricing service.
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Daily fluctuations in the value of such contracts are recorded as unrealized appreciation (depreciation) on forward currency contracts. When the contract is closed, a Portfolio records a realized gain (loss) equal to the difference between the value at the time it was opened and the value at the time it was closed.
During the period ended June 30, 2019, the Emerging Markets Income, Enhanced Opportunities and Explorer Total Return Portfolios traded in forward currency contracts.
(d) Futures Contracts—For hedging and investment purposes, certain Portfolios may enter into futures contracts in US domestic markets, or exchanges located outside the United States.
Foreign markets may offer advantages such as trading opportunities or arbitrage possibilities not available in the United States. Foreign markets, however, may have greater risk potential than domestic markets. For example, some foreign exchanges are principal markets so that no common clearing facility exists and an investor may look only to the broker for performance of the contract. In addition, any profits a Portfolio might realize in trading could be eliminated by adverse changes in the currency exchange rate, or the Portfolio could incur losses as a result of those changes. Transactions on foreign exchanges may include both commodities which are traded on domestic exchanges and those which are not. Unlike trading on domestic commodity exchanges, trading on foreign commodity exchanges is not regulated by the Commodity Futures Trading Commission.
Engaging in these transactions involves risk of loss to the Portfolio which could adversely affect the value of the Portfolio’s net assets. Although each of these Portfolios intends to purchase or sell futures contracts only if there is an active market for such contracts, no assurance can be given that a liquid market will exist for any particular contract at any particular time. Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified periods during the trading day. Futures
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contract prices could move to the limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions and potentially subjecting the Portfolio to substantial losses.
During the period ended June 30, 2019, the Explorer Total Return Portfolio traded in futures contracts.
(e) Options Transactions—For hedging and investment purposes, the Portfolios may purchase and write (sell) put and call options. Such options may be traded on US or non-US securities exchanges or on over-the-counter markets.
The risk associated with purchasing an option is that the Portfolios pay a premium whether or not the option is exercised. Additionally, the Portfolios will not benefit from exercise of an option should the counterparty not perform under the contract. Put and call options purchased are accounted for in the same manner as portfolio securities and other assets.
The risk involved in writing an option is that the Portfolios bear the market risk of an unfavorable change in the price of the security or currency underlying the written option. A Portfolio as a writer of an option has no control over whether the underlying instrument may be sold (“call”) or purchased (“put”) and as a result bears the market risk of an unfavorable change in the price of the instrument underlying the written option. There is the risk the Portfolios may not be able to enter into a closing transaction because of an illiquid market. Certain options may be written with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. When the Portfolios write an option, the premium received by the Portfolios is recorded as a liability and is subsequently adjusted to the current market value of the option written.
During the period ended June 30, 2019, the Enhanced Opportunities and Explorer Total Return Portfolios traded in options.
(f) Short Sales—A short sale is a transaction in which a Portfolio sells securities it does not own but has borrowed in anticipation of
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a decline in the market price of the securities. The initial amount of a short sale is recorded as a liability which is marked-to-market daily. Fluctuations in the value of the short liability are recorded as unrealized gains or losses. A Portfolio realizes a gain or loss upon closing of the short sale (returning the security to the counterparty by way of purchase or delivery of a long position owned). Short sales by a Portfolio involve certain risks and special considerations. Possible losses from short sales differ from losses that could be incurred from a purchase of a security because losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. The Portfolio may have to pay a fee to borrow the particular security and is liable to the buyer for any dividends or interest payable on securities while those securities are in a short position. These dividends and interest amounts are an expense of the Portfolio. The Portfolio designates collateral consisting of cash, US government securities or other liquid assets sufficient to collateralize the market value of short positions.
Proceeds from short sales are generally retained in cash accounts or invested in securities that are cash equivalents. With regard to securities borrowed as of June 30, 2019, pursuant to short sale arrangements, the Portfolios have a right to set off any assets held (including the borrowed securities) or obligations owed to the lender (State Street), in the event of the lender’s default, against any obligations owed by the lender to the Portfolios under any agreement or collateral document, including the collateral value of the Securities Loan Collateral, as that term is defined in the Securities Lending and Services Agreement between the Portfolios and State Street. At June 30, 2019, the Enhanced Opportunities Portfolio had pledged $10,259,061 of long securities as collateral under such arrangements.
For the period ended June 30, 2019, proceeds from securities sold short and purchases to cover short positions for the Enhanced Opportunities Portfolio were $20,958,521 and $21,884,127, respectively.
(g) Swap Agreements—A Portfolio may enter into credit default swap agreements whereby one counterparty (the “Protection Buyer”) pays an upfront payment or a periodic fee throughout the term of the swap agreement provided there is no credit event,
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which is expressed in basis points on the notional amount, in return for a payment by the seller of the credit default swap agreement (the “Protection Seller”) that results if a credit event such as defined in the swap agreement occurs, such as bankruptcy of the reference entity, obligation or index. Such credit default swap agreements are cash settled transactions. If a Portfolio enters into a credit default swap agreement as the Protection Buyer, the Portfolio is exposed to credit risk arising from the potential inability of the Protection Seller to perform under the agreement. If a Portfolio enters into a credit default swap agreement as the Protection Seller, the Portfolio is not exposed to credit risk but is subject to market risk as the credit default swap agreement is recorded at fair value which reflects the creditworthiness of the reference entity. As a Protection Seller, a Portfolio would effectively add leverage to its portfolio because, in addition to its total net assets, a Portfolio would be subject to risk of loss limited to the notional amount of the swap agreement.
Credit ratings on the reference obligor underlying the credit derivatives, together with the periods of expiration, are generally indicators of payment/performance risk. In such instances where a Portfolio is the seller of protection, the likelihood of payment and performance is generally considered greater as the credit spread on the reference obligor underlying the credit derivatives and the period of expiration increases.
Certain standardized swaps, including certain interest rate swaps and credit default swaps, are (or soon will be) subject to mandatory central clearing. Cleared swaps are transacted through futures commission merchants (“FCMs”) that are members of central clearing-houses, with the clearinghouse serving as central counterparty, similar to transactions in futures contracts. Centralized clearing will be required for additional categories of swaps on a phased-in basis based on requirements published by the US Securities and Exchange Commission (“SEC”) and Commodity Futures Trading Commission.
At the time the Fund enters into a centrally cleared swap, the Fund deposits and maintains as collateral an initial margin with the broker, as required by the clearinghouse on which the transaction is effected. Such amount is shown as cash collateral due from broker
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on the statement of assets and liabilities. Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments are known as variation margin and are recorded by the Fund as unrealized gains or losses. Risks may arise from the potential inability of a counterparty to meet the terms of the contract. The credit/counterparty risk for centrally cleared swaps is generally less than non-centrally cleared swaps, since the clearinghouse, which is the issuer or counterparty to each centrally cleared swap, has robust risk mitigation standards, including the requirement to provide initial and variation margin. When the contract is closed, the Fund records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the time it was closed.
Interest rate swap agreements involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest with respect to the notional amount of principal. Certain forms of interest rate swap agreements may include: (i) interest rate caps, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates exceed a specified rate, or “cap,” (ii) interest rate floors, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates fall below a specified rate, or “floor,” (iii) interest rate collars, under which a party sells a cap and purchases a floor or vice versa in an attempt to protect itself against interest rate movements exceeding given minimum or maximum levels, (iv) callable interest rate swaps, under which the counterparty may terminate the swap transaction in whole at zero cost by a predetermined date and time prior to the maturity date, (v) spread locks, which allow the interest rate swap users to lock in the forward differential (or spread) between the interest rate swap rate and specified benchmark, or (vi) basis swaps, under which two parties can exchange variable interest rates based on different money markets.
Swap agreements generally are valued by an independent pricing service, and the change in value, if any, is recorded as unrealized appreciation (depreciation) on swap agreements in a Portfolio’s
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accompanying Statement of Assets and Liabilities. Once the interim payments are settled in cash, the net amount is recorded as realized gain (loss) on swap agreements in a Portfolio’s accompanying Statement of Operations, in addition to any realized gain (loss) recorded upon the termination of swap agreements.
During the period ended June 30, 2019, the Explorer Total Return Portfolio traded in swap agreements.
(h) Federal Income Taxes—The Fund’s policy is to have each Portfolio qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and to distribute all of its taxable income, including any net realized capital gains, to shareholders. Therefore, no federal income tax provision is required.
At December 31, 2018, the following Portfolios had unused realized capital loss carryovers which, for federal income tax purposes, could be used to offset future realized capital gains with no expiration date as follows:
Portfolio | Short-Term | |||
Emerging Markets Income | $ | 24,288 | ||
Explorer Total Return | 22,514,234 |
Under current tax law, post-October capital losses or certain late-year ordinary losses, as defined by the Code, within the taxable year may be deferred and treated as occurring on the first day of the following tax year. For the tax year ended December 31, 2018, the Portfolios had no such losses to defer.
For federal income tax purposes, the aggregate cost, aggregate gross unrealized appreciation, aggregate gross unrealized depreciation and the net unrealized appreciation (depreciation) were as follows:
Portfolio | Aggregate Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | ||||||||||||
Emerging Markets Income | $ | 5,101,066 | $ | 114,981 | $ | 42,105 | $ | 72,876 | ||||||||
Enhanced Opportunities | 8,990,738 | 813,819 | 747,872 | 65,947 | ||||||||||||
Explorer Total Return | 102,779,795 | 4,483,512 | 2,634,549 | 1,848,963 |
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Management has analyzed the Portfolios’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on tax returns filed for any open tax years (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction’s statute of limitations. Each Portfolio files a US federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal Revenue Service for a period of three years from the date of filing.
(i) Dividends and Distributions—Emerging Markets Income and Explorer Total Return Portfolios intend to declare dividends from net investment income, if any, daily and to pay such dividends monthly. Dividends from net investment income, if any, for Enhanced Opportunities Portfolio will be declared and paid annually. During any particular year, net realized gains from investment transactions in excess of available capital loss carryforwards would be taxable to the Portfolios, if not distributed. The Portfolios intend to declare and distribute these amounts, at least annually, to shareholders; however, to avoid taxation, a second distribution may be required. Differences in per share distributions, by class, are generally due to differences in class specific expenses.
Income and capital gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These book/tax differences, which may result in distribution reclassifications, are primarily due to differing treatments of foreign currency transactions, wash sales, return of capital distributions, certain fixed-income securities, and fund expenses, derivatives and distributions from real estate investment trusts. The book/tax differences relating to shareholder distributions resulted in reclassifications among certain capital accounts.
(j) Allocation of Expenses—Expenses common to the Fund, Lazard Retirement Series, Inc., Lazard Global Total Return and Income Fund, Inc. and Lazard World Dividend & Income Fund, Inc. (each a “Lazard Fund” and collectively, the “Lazard Fund Complex”), each a registered management investment company advised by the Investment Manager, not directly chargeable to one or more spe-
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cific Lazard Funds are allocated to the Fund and among its Portfolios primarily on the basis of relative net assets. Expenses of the Fund not directly chargeable to one or more Portfolios are similarly allocated among the Portfolios on the basis of relative net assets. Portfolios accrue distribution and service (12b-1) fees to Open Shares. The Portfolios’ income, expenses (other than class specific expenses) and realized and unrealized gains and losses are allocated proportionally each day between the classes based upon the relative net assets of each class.
(k) Redemption Fee—Until August 15, 2016, the Portfolios imposed a 1.00% redemption fee (short-term trading fee) on Portfolio shares redeemed less than 30 days after such shares were acquired. The fees were retained by the Portfolios and are included as paid in capital on the Statements of Assets and Liabilities. As of August 15, 2016, redemption fees no longer apply to transactions in Portfolio shares.
(l) Estimates—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
(m) Net Asset Value—NAV per share for each class of each Portfolio is determined each day the NYSE is open for trading as of the close of regular trading on the NYSE (generally 4:00 p.m. Eastern time). The Fund will not treat an intraday unscheduled disruption in NYSE trading as a closure of the NYSE, and will price its shares as of 4:00 p.m., if the particular disruption directly affects only the NYSE. NAV per share is determined by dividing the value of the total assets of the Portfolio represented by such class, less all liabilities, by the total number of Portfolio shares of such class outstanding.
3. Investment Management, Administration, Custody, Distribution and Transfer Agency Agreements
The Fund, on behalf of the Portfolios, has entered into a management agreement (the “Management Agreement”) with the Invest-
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ment Manager. Pursuant to the Management Agreement, the Investment Manager regularly provides each Portfolio with investment research, advice and supervision and furnishes continuously an investment program for each Portfolio consistent with its investment objectives and policies, including the purchase, retention and disposition of securities, and provides the Portfolios with administrative, operational and compliance assistance services. For its services provided to the Portfolios, the Investment Manager earns a management fee, accrued daily as a percentage of each Portfolio’s average daily net assets and payable by each Portfolio monthly, at the annual rate set forth below:
Portfolio | Annual Rate | ||||
Emerging Markets Income | 0.65 | % | |||
Enhanced Opportunities | 0.95 | ||||
Explorer Total Return (a) | 0.80 |
(a) | From January 1, 2019 to June 4, 2019, percentage was 0.90%. |
The Investment Manager has voluntarily agreed to waive its fees and, if necessary, reimburse the Portfolios until May 1, 2020 if the aggregate direct expenses of the Portfolios, exclusive of taxes, brokerage, interest on borrowings, dividend and interest expenses on securities sold short, fees and expenses of “Acquired Funds” (as defined in Form N-1A) and extraordinary expenses, including, for the purposes of the expense limitation agreement only, fees related to filing foreign tax reclaims, on behalf of the Portfolios, exceed the percentages of the value of the Portfolio’s average daily net assets set forth opposite the Portfolio’s name on table below. The Fund, on behalf of the Portfolio, may deduct from the payment to be made to the Investment Manager under the Management Agreement, or the Investment Manager will bear, such excess expense.
Portfolio | Institutional Shares | Open Shares | |||||||
Emerging Markets Income | 0.80 | % | 0.95 | % | |||||
Enhanced Opportunities (a) | 1.25 | 1.50 | |||||||
Explorer Total Return (b) | 1.00 | 1.30 |
(a) | From January 1, 2019 to June 4, 2019, percentages were 0.90% and 1.05%, respectively. |
(b) | From January 1, 2019 to June 4, 2019, percentages were 1.10% and 1.40%, respectively. |
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During the period ended June 30, 2019, the Investment Manager waived its management fees and reimbursed the following Portfolios for other expenses as follows:
Institutional Shares | Open Shares | ||||||||||||||||
Portfolio | Management Fees Waived | Expenses Reimbursed | Management Fees Waived | Expenses Reimbursed | |||||||||||||
Emerging Markets Income | $ 16,606 | $ 50,742 | $ 463 | $ 2,839 | |||||||||||||
Enhanced Opportunities | 53,487 | 86,351 | 567 | 2,372 | |||||||||||||
Explorer Total Return | 43,283 | — | 48 | 1,342 |
The aforementioned waivers and/or reimbursements are not subject to recoupment by the Investment Manager.
State Street provides the Fund with custody and certain fund administration and accounting services.
The Fund has a distribution agreement with Lazard Asset Management Securities LLC (the “Distributor”), a wholly-owned subsidiary of the Investment Manager, to serve as the distributor for shares of each Portfolio. The Distributor bears the cost of printing and mailing prospectuses to potential investors and certain expenses in connection with the offering of Portfolio shares.
Under a distribution and servicing plan adopted pursuant to Rule 12b-1 under the 1940 Act, each Portfolio pays a monthly fee to the Distributor, at an annual rate of 0.25% of the average daily net assets of its Open Shares, for distribution and servicing of accounts. The Distributor may make payments to certain financial institutions, securities dealers and other industry professionals for providing these services.
DST is the Fund’s transfer and dividend disbursing agent.
4. Directors’ Compensation
Certain Directors of the Fund are officers of the Investment Manager. For the period ended June 30, 2019, each Director who is not an affiliated person of the Investment Manager or any of its affiliates was paid by all of the funds in the Lazard Fund Complex: (1) an annual retainer of $232,000, (2) an additional annual fee of $33,000 to the lead Independent Director (an “Independent Direc-
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tor” is a Director who is not an “interested person” (as defined in the 1940 Act) of the Fund), and (3) an additional annual fee of $23,000 to the Audit Committee Chair. The Independent Directors may be paid additional compensation for participation on ad hoc committees or other work performed on behalf of the Board. The Independent Directors also are reimbursed for travel and other out-of-pocket expenses for attending Board and committee meetings. The Directors do not receive benefits from the Fund pursuant to any pension, retirement or similar arrangement. Independent Directors’ fees are allocated among the funds in the Lazard Fund Complex at a rate of $5,000 per fund with the remainder allocated based upon each fund’s proportionate share of combined net assets. The Statements of Operations show the Independent Directors’ fees and expenses paid by each Portfolio.
5. Securities Transactions and Transactions with Affiliates
Purchases and sales of portfolio securities (excluding short-term investments and short sales) for the period ended June 30, 2019 were as follows:
Portfolio | Purchases | Sales | ||||||
Emerging Markets Income | $ | 419,959 | $ | 1,104,647 | ||||
Enhanced Opportunities | 45,131,131 | 53,284,568 | ||||||
Explorer Total Return | 91,609,384 | 115,383,927 |
For the period ended June 30, 2019, the Portfolios did not engage in any cross-trades in accordance with Rule 17a-7 under the 1940 Act, and no brokerage commissions were paid to affiliates of the Investment Manager or other affiliates of the Fund for portfolio transactions executed on behalf of the Fund.
At June 30, 2019, the Investment Manager owned 88.22% and 60.76% of the outstanding shares of the Emerging Markets Income and Enhanced Opportunities Portfolios, respectively.
6. Line of Credit
The Fund has a $50 million Line of Credit Agreement (the “Agreement”) with State Street, primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. Inter-
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est on borrowings is payable at the higher of the Federal Funds rate or One-Month LIBOR rate plus 1.00%, on an annualized basis. Under the Agreement, the Fund has agreed to pay a 0.20% per annum fee on the unused portion of the commitment, payable quarterly in arrears. The Fund has also agreed to pay an upfront fee of 0.05% of the committed line amount. During the period ended June 30, 2019, the following Portfolios had borrowings under the Agreement as follows:
Portfolio | Average Daily Loan Balance | * | Maximum Daily Loan Outstanding | Weighted Average Interest Rate | Number of Days Borrowings were Outstanding | |||||||||||
Emerging Markets Income | $ | 25,000 | $ | 25,000 | 3.49 | % | 1 | |||||||||
Explorer Total Return | 3,070,000 | 3,070,000 | 3.51 | 1 |
*For days borrowings were outstanding.
Management believes that the fair value of the liabilities under the line of credit is equivalent to the recorded amount based on its short-term maturity and interest rate, which fluctuates with LIBOR. A Portfolio’s outstanding balance on the line of credit, if any, would be categorized as Level 2.
7. Investment Risks
(a) Non-US Securities Risk—A Portfolio’s performance will be influenced by political, social and economic factors affecting the non-US countries and companies in which the Portfolio invests. Non-US securities carry special risks, such as less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less liquidity.
(b) Emerging Market Risk—Emerging market countries generally have economic structures that are less diverse and mature, and political systems that are less stable, than those of developed countries. The economies of countries with emerging markets may be based predominantly on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme debt burdens or volatile inflation rates. The securities markets of emerging market countries have historically been extremely volatile. These market conditions may continue or
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worsen. Investments in these countries may be subject to political, economic, legal, market and currency risks. The risks may include less protection of property rights and uncertain political and economic policies, the imposition of capital controls and/or foreign investment limitations by a country, nationalization of businesses and the imposition of sanctions by other countries, such as the US. Significant devaluation of emerging market currencies against the US dollar may occur subsequent to acquisition of investments denominated in emerging market currencies.
(c) Foreign Currency Risk—Investments denominated in currencies other than US dollars may experience a decline in value, in US dollar terms, due solely to fluctuations in currency exchange rates. A Portfolio’s currency investments could be adversely affected by delays in, or a refusal to grant, repatriation of funds or conversion of emerging market currencies. The Investment Manager generally does not intend to actively hedge the Portfolio’s foreign currency exposure.
(d) Fixed-Income and Debt Securities Risk—The market value of a debt security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The debt securities market can be susceptible to increases in volatility and decreases in liquidity. Liquidity can decline unpredictably in response to overall economic conditions or credit tightening.
Prices of bonds and other debt securities tend to move inversely with changes in interest rates. Typically, a rise in rates will adversely affect debt securities and, accordingly, will cause the value of a Portfolio’s investments in these securities to decline. Interest rate risk is usually greater for fixed-income securities with longer maturities or durations. A rise in interest rates (or the expectation of a rise in interest rates) may result in periods of volatility, decreased liquidity and increased redemptions, and, as a result, the Portfolio may have to liquidate portfolio securities at disadvantageous prices. During periods of reduced market liquidity, a Portfo-
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lio may not be able to readily sell debt securities at prices at or near their perceived value. An unexpected increase in Portfolio redemption requests, including a single large request for a significant percentage of a Portfolio’s shares, which may be triggered by market turmoil or an increase in interest rates, could cause the Portfolio to sell its holdings at a loss or at undesirable prices and adversely affect the Portfolio’s share price and increase the Portfolio’s liquidity risk, and/or Portfolio expenses. Economic and other developments can adversely affect debt securities markets.
A Portfolio’s investments in lower-rated, higher-yielding securities (“junk bonds”) are subject to greater credit risk than its higher-rated investments. Credit risk is the risk that the issuer will not make interest or principal payments, or will not make payments on a timely basis. Non-investment grade securities tend to be more volatile, less liquid and are considered speculative. If there is a decline, or perceived decline, in the credit quality of a debt security (or any guarantor of payment on such security), the security’s value could fall, potentially lowering a Portfolio’s share price. The prices of non-investment grade securities, unlike investment grade debt securities, may fluctuate unpredictably and not necessarily inversely with changes in interest rates. The prices of high yield securities can fall in response to negative news about the issuer or its industry, or the economy in general to a greater extent than those of higher-rated securities. The market for these securities may be less liquid and therefore these securities may be harder to value or sell at an acceptable price, especially during times of market volatility or decline.
Some fixed-income securities may give the issuer the option to call, or redeem, the securities before their maturity. If securities held by a Portfolio are called during a time of declining interest rates (which is typically the case when issuers exercise options to call outstanding securities), the Portfolio may have to reinvest the proceeds in an investment offering a lower yield (and the Portfolio may not fully benefit from any increase in the value of its portfolio holdings as a result of declining interest rates).
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Adjustable rate securities provide a Portfolio with a certain degree of protection against rises in interest rates, although such securities will participate in any declines in interest rates as well. Certain adjustable rate securities, such as those with interest rates that fluctuate directly or indirectly based on multiples of a stated index, are designed to be highly sensitive to changes in interest rates and can subject the holders thereof to extreme reductions of yield and possibly loss of principal. Certain fixed-income securities may be issued at a discount from their face value (such as zero coupon securities) or purchased at a price less than their stated face amount or at a price less than their issue price plus the portion of “original issue discount” previously accrued thereon,i.e.,purchased at a “market discount.”The amount of original issue discount and/or market discount on certain obligations may be significant, and accretion of market discount together with original issue discount will cause a Portfolio to realize income prior to the receipt of cash payments with respect to these securities.
(e) Underlying Funds Risk—Shares of exchange-traded funds (“ETFs”), closed-end funds and exchange-traded notes (“ETNs” and collectively with ETFs and closed-end funds, “Underlying Funds”) in which certain Portfolios invest may trade at prices that vary from their NAVs, sometimes significantly. The shares of ETFs and closed-end funds may trade at prices at, below or above their most recent NAV. Shares of closed-end funds, in particular, frequently trade at persistent discounts to their NAV. In addition, the performance of an ETF pursuing a passive index-based strategy may diverge from the performance of the index. ETNs may not trade in the secondary market, but typically are redeemable by the issuer. A Portfolio’s investments in Underlying Funds are subject to the risks of Underlying Funds’ investments, as well as to the general risks of investing in Underlying Funds. Portfolio shares will bear not only the Portfolio’s management fees and operating expenses, but also their proportional share of the management fees and operating expenses of the ETFs and closed-end funds in which the Portfolio invests. While ETNs do not have management fees, they are subject to certain investor fees. ETNs are debt securities that, like ETFs, typically are listed on exchanges and their terms generally provide for a return that tracks specified market indexes.
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However, unlike ETFs and closed-end funds, ETNs are not registered investment companies and thus are not registered under the 1940 Act. In addition, as debt securities, ETNs are subject to the additional risk of the creditworthiness of the issuer. ETNs typically do not make periodic interest payments.
These Portfolios may be limited by the 1940 Act in the amount of their assets that may be invested in ETFs and closed-end funds unless an ETF or a closed-end fund has received an exemptive order from the SEC on which the Portfolios may rely or an exemption is available.
Many ETFs have received an exemptive order from the SEC providing an exemption from the 1940 Act limits on the amount of assets that may be invested in ETFs and closed-end funds, and a Portfolio’s reliance on an order is conditioned on compliance with certain conditions of the order. If an exemptive order has not been received and an exemption is not available under the 1940 Act, the Portfolio will be limited in the amount it can invest in Underlying Funds that are registered investment companies to: (1) 3% or less of an Underlying Fund’s voting shares, (2) an Underlying Fund’s shares in value equal to or less than 5% of the Portfolio’s assets and (3) shares of Underlying Funds in the aggregate in value equal to or less than 10% of the Portfolio’s total assets.
(f) Short Position Risk—Short sales or positions may involve substantial risks. If a short position appreciates in value during a period of the Portfolio’s investment, there will be a loss to the Portfolio that could be substantial. Short positions involve more risk than long positions because the maximum sustainable loss on a security purchased is limited to the amount paid for the security plus the transaction costs. However, a Portfolio’s potential loss on a short position is unlimited because, theoretically, there is no limit to the potential price increase of a security.
Short sales of securities also may involve additional transaction-related costs such as those in connection with borrowing the securities sold short.
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There is a risk that certain Portfolios may be unable to fully implement their investment strategies due to a lack of available securities to borrow to effect short sales or for some other reason.
When seeking to effect short sales of securities, a Portfolio may not always be able to borrow a security the Portfolio seeks to sell short at a particular time or at an acceptable price. In addition, a Portfolio may not always be able to close out a short sale position at a particular time or at an acceptable price. If the lender of a borrowed security requires a Portfolio to return the security to it on short notice, and the Portfolio is unable to borrow the security from another lender, the Portfolio may have to buy the borrowed security at an unfavorable price, resulting in a loss. In addition, there is a risk that the collateral pledged to the Portfolio’s custodian to secure securities borrowings in connection with short sales of securities may not be returned to the Portfolio or may not be returned in a timely manner.
It is possible that the market value of the securities a Portfolio holds in long positions will decline at the same time that the market value of the securities to which the Portfolio has short exposure increases, thereby increasing the Portfolio’s potential volatility.
(g) Derivatives and Hedging Risk—Derivatives transactions, including those entered into for hedging purposes (i.e., seeking to protect Portfolio investments), may increase volatility, reduce returns, limit gains or magnify losses, perhaps substantially, particularly since most derivatives have a leverage component that provides investment exposure in excess of the amount invested. Over-the-counter swap agreements, forward currency contracts, writing or purchasing over-the-counter options on securities (including options on ETFs and ETNs), indexes and currencies and other over-the-counter derivatives transactions are subject to the risk of default by the counterparty and can be illiquid. Changes in liquidity may result in significant, rapid and unpredictable changes in the prices for derivatives. These derivatives transactions, as well as the exchange-traded futures and options in which certain Portfolios may invest, are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related index, commodity, interest rate, currency, security or other reference asset.
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As such, a small investment could have a potentially large impact on a Portfolio’s performance. Purchasing options will reduce returns by the amount of premiums paid for options that are not exercised. In fact, many derivatives may be subject to greater risks than those associated with investing directly in the underlying or other reference asset. Derivatives transactions incur costs, either explicitly or implicitly, which reduce returns, and costs of engaging in such transactions may outweigh any gains or any losses averted from hedging activities. Successful use of derivatives, whether for hedging or for other investment purposes, is subject to the Investment Manager’s ability to predict correctly movements in the direction of the relevant reference asset or market and, for hedging activities, correlation of the derivative instruments used with the investments seeking to be hedged. Use of derivatives transactions, even when entered into for hedging purposes, may cause a Portfolio to experience losses greater than if the Portfolio had not engaged in such transactions.
8. Contractual Obligations
The Fund enters into contracts in the normal course of business that contain a variety of indemnification provisions. A Portfolio’s maximum exposure under these arrangements is unknown. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.
9. Fair Value Measurements
Fair value is defined as the price that a Portfolio would receive to sell an asset, or would pay to transfer a liability, in an orderly transaction between market participants at the date of measurement. The Fair Value Measurements and Disclosures provisions of GAAP also establish a framework for measuring fair value, and a three-level hierarchy for fair value measurement that is based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer, broadly, to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions
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about the assumptions that market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances. The fair value measurement level within the fair value hierarchy for the assets and liabilities of the Fund is based on the lowest level of any input that is significant to the overall fair value measurement. The three-level hierarchy of inputs is summarized below:
● | Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities |
● | Level 2 – other significant observable inputs (including unadjusted quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.) |
● | Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities) |
Changes in valuation technique may result in transfers into or out of the current assigned level within the hierarchy.
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in these securities.
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The following table summarizes the valuation of the Portfolios’ assets and liabilities by each fair value hierarchy level as of June 30, 2019:
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Emerging Markets Income Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Foreign Government Obligations* | $ | — | $ | 1,336,796 | $ | — | $ | 1,336,796 | |||||||||
US Treasury Securities | — | 2,797,761 | — | 2,797,761 | |||||||||||||
Short-Term Investments | 992,415 | — | — | 992,415 | |||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | — | 64,974 | — | 64,974 | |||||||||||||
Total | $ | 992,415 | $ | 4,199,531 | $ | — | $ | 5,191,946 | |||||||||
Liabilities: | |||||||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | $ | — | $ | (18,004 | ) | $ | — | $ | (18,004 | ) | |||||||
Enhanced Opportunities Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Common Stocks* | |||||||||||||||||
United States | $ | 15 | $ | — | $ | — | $ | 15 | |||||||||
Preferred Stocks* | |||||||||||||||||
United States | 24,434 | — | — | 24,434 | |||||||||||||
Convertible Corporate Bonds | — | 10,639,175 | — | 10,639,175 | |||||||||||||
Purchased Options | 2,122 | — | — | 2,122 | |||||||||||||
Short-Term Investments | 3,613,950 | — | — | 3,613,950 | |||||||||||||
Total | $ | 3,640,521 | $ | 10,639,175 | $ | — | $ | 14,279,696 | |||||||||
Liabilities: | |||||||||||||||||
Securities Sold Short | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Bermuda | $ | (8,965 | ) | $ | — | $ | — | $ | (8,965 | ) | |||||||
Canada | (356,789 | ) | — | — | (356,789 | ) | |||||||||||
Chile | (24,032 | ) | — | — | (24,032 | ) | |||||||||||
China | (76,792 | ) | — | — | (76,792 | ) | |||||||||||
Netherlands | (27,038 | ) | — | — | (27,038 | ) | |||||||||||
Norway | (23,944 | ) | — | — | (23,944 | ) | |||||||||||
Thailand | (165,435 | ) | — | — | (165,435 | ) | |||||||||||
United States | (4,148,900 | ) | — | — | (4,148,900 | ) | |||||||||||
Exchange-Traded Fund | (384,630 | ) | — | — | (384,630 | ) | |||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | — | (6,486 | ) | — | (6,486 | ) | |||||||||||
Total | $ | (5,216,525 | ) | $ | (6,486 | ) | $ | — | $ | (5,223,011 | ) |
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Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Explorer Total Return Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Corporate Bonds* | $ | — | $ | 11,750,348 | $ | — | $ | 11,750,348 | |||||||||
Foreign Government Obligations* | — | 68,419,998 | — | 68,419,998 | |||||||||||||
Quasi Government Bonds* | — | 395,250 | — | 395,250 | |||||||||||||
Supranational Bonds | — | 410,060 | — | 410,060 | |||||||||||||
US Treasury Securities | — | 23,372,218 | — | 23,372,218 | |||||||||||||
Short-Term Investments | 221,410 | — | — | 221,410 | |||||||||||||
Purchased Options | — | 170,991 | — | 170,991 | |||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | — | 274,062 | — | 274,062 | |||||||||||||
Interest Rate Swap Agreements | — | 241,987 | — | 241,987 | |||||||||||||
Total | $ | 221,410 | $ | 105,304,914 | $ | — | $ | 105,256,324 | |||||||||
Liabilities: | |||||||||||||||||
Other Financial Instruments† | |||||||||||||||||
Centrally Cleared Swap Agreements | $ | — | $ | (435,059 | ) | $ | — | $ | (435,059 | ) | |||||||
Credit Default Swap Agreements | — | (31,202 | ) | — | (31,202 | ) | |||||||||||
Forward Currency Contracts | — | (161,305 | ) | — | (161,305 | ) | |||||||||||
Total | $ | — | $ | (627,566 | ) | $ | — | $ | (627,566 | ) |
10. Derivative Instruments
Certain Portfolios may use derivative instruments, including forward currency contracts, futures contracts, options or swap agreements.
Forward currency contracts may be used for hedging purposes or to seek to increase returns.
A Portfolio may enter into futures transactions to hedge against changes in interest rates, securities prices, and/or currency exchange rates, to increase total return, or to otherwise gain access or attain exposure to certain markets or other underliers.
A Portfolio may write or purchase a call or put option to seek to realize, through the receipt of premiums or changes in market value, a greater return than would be realized on the underlying securities alone, or to seek to protect the Portfolio from losses.
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A Portfolio enters into swap agreements in an attempt to obtain a particular exposure when it is considered desirable to do so, possibly at a lower cost to such Portfolio than if it had invested directly in the asset that yielded the desired exposure.
During the period ended June 30, 2019, the approximate average monthly notional exposure for derivative instruments was as follows:
Derivative Instruments | Emerging Markets Income Portfolio | Enhanced Opportunities Portfolio | Explorer Total Return Portfolio | |||||||||
Credit default swap agreements: | ||||||||||||
Average notional value – buy protection OTC | — | — | 8,200,000 | |||||||||
Average notional value – buy protection centrally cleared | — | — | 24,400,000 | # | ||||||||
Forward currency contracts: | ||||||||||||
Average amounts purchased | 4,500,000 | 100,000 | 21,400,000 | |||||||||
Average amounts sold | 700,000 | 600,000 | 27,500,000 | |||||||||
Futures contracts: | ||||||||||||
Average notional value of contracts – long | — | — | 5,100,000 | * | ||||||||
Interest rate swap agreements: | ||||||||||||
Average notional value – receives fixed rate | — | — | 3,500,000 | |||||||||
Options: | ||||||||||||
Average value of purchased options | — | 100,000 | 700,000 | |||||||||
Average value of written options | — | — | 14,500,000 | # |
# | Represents average monthly notional exposure for the four months the derivative instrument was open during the period. |
* | Represents notional exposure for the fifteen days the derivative instrument was open during the period. |
The Enhanced Opportunities Portfolio also traded in written options having an average monthly notional exposure of less than $50,000.
Emerging Markets Income Portfolio
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Assets – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized appreciation on forward currency contracts | $ | 64,974 | |||
Liabilities – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized depreciation on forward currency contracts | $ | 18,004 |
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The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Total | |||
Forward currency contracts | $ | 50,552 | ||
Net Change in Unrealized Appreciation (Depreciation) on: | Total | |||
Forward currency contracts | $1,834 |
Enhanced Opportunities Portfolio
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Assets – Derivative Financial Instruments | Total | |||||
Purchased options | Investments in securities, at fair value | $2,122 | ||||
Liabilities – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized depreciation on forward currency contracts | $6,486 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Equity Contracts | Foreign Currency Contracts | Total | |||||||||
Forward currency contracts | $ | — | $ | (2,573 | ) | $ | (2,573 | ) | ||||
Purchased options | (111,052 | ) | — | (111,052 | ) | |||||||
Written options | 20,085 | — | 20,085 | |||||||||
Total | $ | (90,967 | ) | $ | (2,573 | ) | $ | (93,540 | ) | |||
Net Change in Unrealized Appreciation (Depreciation) on: | Equity Contracts | Foreign Currency Contracts | Total | |||||||||
Forward currency contracts | $ | — | $ | 55 | $ | 55 | ||||||
Purchased options | 9,398 | — | 9,398 | |||||||||
Written options | (274 | ) | — | (274 | ) | |||||||
Total | $ | 9,124 | $ | 55 | $ | 9,179 |
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Explorer Total Return Portfolio
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Assets – Derivative Financial Instruments | Foreign Currency Contracts | Interest Rate Contracts | Total | |||||||||
Forward currency contracts | ||||||||||||
Unrealized appreciation on forward currency contracts | $ | 274,062 | $ | — | $ | 274,062 | ||||||
Purchased options | ||||||||||||
Investments in securities, at fair value | 170,991 | — | 170,991 | |||||||||
Swap agreements | ||||||||||||
Unrealized appreciation on interest rate swap | — | 241,987 | 241,987 | |||||||||
Total | $ | 445,053 | $ | 241,987 | $ | 687,040 | ||||||
Liabilities – Derivative Financial Instruments | Credit Contracts | Foreign Currency Contracts | Total | |||||||||
Forward currency contracts | ||||||||||||
Unrealized depreciation on forward currency contracts | $ | — | $ | 161,305 | $ | 161,305 | ||||||
Swap agreements | ||||||||||||
Unrealized depreciation on centrally cleared swaps | 435,059 | — | 435,059 | |||||||||
Premiums for swap agreements purchased | 142,843 | — | 142,843 | |||||||||
Total | $ | 577,902 | $ | 161,305 | $ | 739,207 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Credit Contracts | Foreign Currency Contracts | Interest Rate Contracts | Total | ||||||||||||
Futures Contracts | $ | — | $ | — | $ | (9,190 | ) | $ | (9,190 | ) | ||||||
Forward currency contracts | — | 399,309 | — | 399,309 | ||||||||||||
Purchased options | — | (1,133,365 | ) | — | (1,133,365 | ) | ||||||||||
Written options | — | 191,289 | — | 191,289 | ||||||||||||
Swap agreements | (294,983 | ) | — | 29,100 | (265,883 | ) | ||||||||||
Total | $ | (294,983 | ) | $ | (542,767 | ) | $ | 19,910 | $ | (817,840 | ) | |||||
Net Change in Unrealized Appreciation (Depreciation) on: | Credit Contracts | Foreign Currency Contracts | Interest Rate Contracts | Total | ||||||||||||
Forward currency contracts | $ | — | $ | (409,084 | ) | $ | — | $ | (409,084 | ) | ||||||
Purchased options | — | 369,957 | — | 369,957 | ||||||||||||
Written options | — | 18,966 | — | 18,966 | ||||||||||||
Swap agreements | (601,367 | ) | — | 161,699 | (439,668 | ) | ||||||||||
Total | $ | (601,367 | ) | $ | (20,161 | ) | $ | 161,699 | $ | (459,829 | ) |
As of June 30, 2019, the Emerging Markets Income, Enhanced Opportunities and Explorer Total Return Portfolios held derivative
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instruments that are eligible for offset in the Statements of Assets and Liabilities and are subject to master netting arrangements. A master netting arrangement is an agreement between two counterparties who have multiple contracts with each other that provides for the net settlement of all contracts, as well as any cash collateral, through a single payment in the event of default on, or termination of, any one contract.
The required information for the affected Portfolios are presented in the below table, as of June 30, 2019:
Emerging Markets Income Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | |||||||||||
Forward Currency Contracts | $ | 64,974 | $ | — | $ | 64,974 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received | Net Amounts of Derivative Assets | ||||||||||||||
BNP Paribas SA | $ | 10,500 | $ | — | $ | — | $ | 10,500 | ||||||||||
Citibank NA | 18,028 | (10,959 | ) | — | 7,069 | |||||||||||||
HSBC Bank USA NA | 31,856 | (6,341 | ) | — | 25,515 | |||||||||||||
JPMorgan Chase Bank NA | 96 | — | — | 96 | ||||||||||||||
Standard Chartered Bank | 4,494 | (704 | ) | — | 3,790 | |||||||||||||
Total | $ | 64,974 | $ | (18,004 | ) | $ | — | $ | 46,970 |
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||
Forward Currency Contracts | $ | 18,004 | $ | — | $ | 18,004 |
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Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
Citibank NA | $ | 10,959 | $ | (10,959 | ) | $ | — | $ | — | |||||||||
HSBC Bank USA NA | 6,341 | (6,341 | ) | — | — | |||||||||||||
Standard Chartered Bank | 704 | (704 | ) | — | — | |||||||||||||
Total | $ | 18,004 | $ | (18,004 | ) | $ | — | $ | — |
Enhanced Opportunities Portfolio
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||
Forward Currency Contracts | $ | 6,486 | $ | — | $ | 6,486 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
State Street Bank and Trust Co. | $ | 6,486 | $ | — | $ | — | $ | 6,486 |
Explorer Total Return Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | |||||||||||
Forward Currency Contracts | $ | 274,062 | $ | — | $ | 274,062 | ||||||||
Interest Rate Swap Agreements | 241,987 | — | 241,987 | |||||||||||
Purchased Options | 170,991 | — | 170,991 | |||||||||||
Total | $ | 687,040 | $ | — | $ | 687,040 |
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Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received (a) | Net Amounts of Derivative Assets | ||||||||||||||
Bank of America NA | $ | 11,515 | $ | (11,515 | ) | $ | — | $ | — | |||||||||
Barclays Bank PLC | 41,912 | (31,427 | ) | — | 10,485 | |||||||||||||
Citibank NA | 5,501 | (5,501 | ) | — | — | |||||||||||||
Goldman Sachs International | 88,210 | (88,210 | ) | — | — | |||||||||||||
HSBC Bank USA NA | 6,086 | (4,611 | ) | — | 1,475 | |||||||||||||
JPMorgan Chase Bank NA | 261,742 | (12,387 | ) | (249,355 | ) | — | ||||||||||||
JPMorgan Securities, Inc. | 89,732 | — | — | 89,732 | ||||||||||||||
Standard Chartered Bank | 107,807 | (23,788 | ) | — | 84,019 | |||||||||||||
UBS AG | 74,535 | (18,593 | ) | — | 55,942 | |||||||||||||
Total | $ | 687,040 | $ | (196,032 | ) | $ | (249,355 | ) | $ | 241,653 |
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||
Credit Default Swap Agreements | $ | 142,843 | $ | — | $ | 142,843 | ||||||||
Forward Currency Contracts | 161,305 | — | 161,305 | |||||||||||
Total | $ | 304,148 | $ | — | $ | 304,148 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
Bank of America NA | $ | 38,388 | $ | (11,515 | ) | $ | — | $ | 26,873 | |||||||||
Barclays Bank PLC | 31,427 | (31,427 | ) | — | — | |||||||||||||
Citibank NA | 8,520 | (5,501 | ) | — | 3,019 | |||||||||||||
Goldman Sachs International | 166,434 | (88,210 | ) | — | 78,224 | |||||||||||||
HSBC Bank USA NA | 4,611 | (4,611 | ) | — | — | |||||||||||||
JPMorgan Chase Bank NA | 12,387 | (12,387 | ) | — | — | |||||||||||||
Standard Chartered Bank | 23,788 | (23,788 | ) | — | — | |||||||||||||
UBS AG | 18,593 | (18,593 | ) | — | — | |||||||||||||
Total | $ | 304,148 | $ | (196,032 | ) | $ | — | $ | 108,116 |
(a) | Collateral amounts disclosed in the table above may be adjusted due to the requirement to limit collateral amounts to avoid the effect of over-collateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein. |
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11. Accounting Pronouncements
In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-08,Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, which amends the amortization period for certain purchased callable debt securities. Management has evaluated the impact of the amendments and has adopted these amendments and incorporated the changes in the current financial statements and related disclosures. For public business entities, the amendments in this ASU became effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018.
In August 2018, the FASB issued an Accounting Standards Update, ASU 2018-13, Fair Value Measurement (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement which removes, modifies and adds disclosures to Topic 820. The amendments in this ASU apply to all entities that are required, under existing GAAP, to make disclosures about recurring or nonrecurring fair value measurements. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. Management has evaluated the impact of the amendments and has elected to adopt these amendments and incorporate the changes in the current financial statements.
12. Subsequent Events
Management has evaluated subsequent events affecting the Portfolios through the issuance of the financial statements and has determined that there were no subsequent events that required adjustment or disclosure.
92 Semi-Annual Report
The Lazard Funds, Inc.
Board of Directors and Officers Information (unaudited)
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Independent Directors(3): | ||||
Franci J. Blassberg (1953) | Director (August 2014) | Debevoise & Plimpton LLP, a law firm,Of Counsel(2013 – present)
Cornell Law School,AdjunctProfessor(2013 – 2016, 2019)
The Buchmann Faculty of Law, Tel Aviv University,VisitingProfessor(2019)
University of California, Berkeley School of Law,Adjunct Professor (Spring 2017) | ||
Kenneth S. Davidson (1945) | Director (August 1995) | Davidson Capital Management Corporation, an investment manager,President (1978 – present)
Landseer Advisors LLC, an investment manager,Senior Advisor(2012 – 2014) | ||
Nancy A. Eckl (1962) | Director (April 2007) | College Retirement Equities Fund (eight accounts),Trustee (2007 – present)
TIAA-CREF Funds (69 funds) and TIAA-CREF Life Funds (11 funds),Trustee(2007 – present)
TIAA Separate Account VA-1,Member of the ManagementCommittee(2007 – present) | ||
Trevor W. Morrison (1971) | Director (April 2014) | New York University School of Law,Dean and Eric M. and Laurie B.Roth Professor of Law (2013 – present)
Columbia Law School,Professor ofLaw(2008 – 2013) | ||
Richard Reiss, Jr. (1944) | Director (May 1991) | Georgica Advisors LLC, an investment manager,Chairman (1997 – present)
Resource America, Inc., a real estate asset management company,Director(2016 – 2018) |
Semi-Annual Report 93
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Robert M. Solmson (1947) | Director (September 2004) | Fairwood Capital, LLC, a private investment corporation engaged primarily in real estate and hotel investments, Co-Managing Partner and Managing Director (2008 – present) | ||
Interested Directors(4): | ||||
Ashish Bhutani (1960) | Director (July 2005) | Investment Manager, Chief Executive Officer (2004 – present)
Lazard Ltd, Vice Chairman and Director (2010 – present) | ||
Nathan A. Paul (1973) | Director (October 2017), Chief Executive Officer and President (February 2017; previously, Vice President and Secretary since April 2002) | Investment Manager, Chief Business Officer (April 2017 – present) and Managing Director (2003 – present)
Investment Manager, General Counsel (2002 – April 2017) |
(1) | The address of each Director of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each Director serves as a Director for each of the funds in the Lazard Fund Complex (comprised of, as of July 31, 2019, 39 active investment portfolios). Each Director serves an indefinite term, until his or her successor is elected, and each Director serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | “Independent Directors” are not “interested persons” (as defined in the 1940 Act) of the Fund. |
(4) | Messrs. Bhutani and Paul are “interested persons” (as defined in the 1940 Act) of the Fund because of their positions with the Investment Manager. |
The Fund’s Statement of Additional Information contains further information about the Directors and is available without charge by calling 800-823-6300, or online, at www.lazardassetmanagement.com.
94 Semi-Annual Report
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) During the Past Five Years | ||
Officers(3): | ||||
Mark R. Anderson (1970) | Chief Compliance Officer (September 2014), Vice President and Secretary (February 2017) | Managing Director (since February 2017, previously Director), Chief Compliance Officer (since September 2014) and General Counsel (since April 2017) of the Investment Manager
Senior Vice President, Counsel and Deputy Chief Compliance Officer of AllianceBernstein L.P. (2004 – August 2014) | ||
Christopher Snively (1984) | Chief Financial Officer (March 2016) | Senior Vice President of the Investment Manager (since November 2015)
Assurance Manager at PricewaterhouseCoopers LLP (2008 – November 2015) | ||
Stephen St. Clair (1958) | Treasurer (May 2003) | Vice President of the Investment Manager | ||
Shari L. Soloway (1981) | Assistant Secretary (November 2015) | Head of Legal, North America (since January 2019, previously Senior Vice President, Legal and Compliance (since September 2015)) of the Investment Manager
Vice President and Associate General Counsel of GE Asset Management (July 2011 – September 2015) | ||
Jessica A. Falzone (1989) | Assistant Secretary (January 2019) | Vice President, Legal and Compliance, of the Investment Manager (since March 2018)
Associate at Schulte Roth & Zabel LLP (2014 – March 2018) | ||
Cesar A. Trelles (1975) | Assistant Treasurer (December 2004) | Vice President of the Investment Manager |
(1) | The address of each officer of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each officer serves for an indefinite term, until his or her successor is elected and qualifies or until his or her earlier resignation or removal. Each officer serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | In addition to Nathan A. Paul, Chief Executive Officer and President (since February 2017; previously, Vice President and Secretary since April 2002), whose information is included in the Interested Directors section above. |
Semi-Annual Report 95
The Lazard Funds, Inc.Other Information (unaudited)
Proxy Voting
A description of the policies and procedures used to determine how proxies relating to Fund portfolio securities are voted is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov.
The Fund’s proxy voting record for the most recent 12-month period ended June 30 is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov. Information as of June 30 each year will generally be available by the following August 31.
Schedule of Portfolio Holdings
The Fund files its complete schedule of each Portfolio’s holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT reports are available on the SEC’s website at https://www.sec.gov.
Board Consideration of Management Agreement
At meetings of the Board held on May 22, 2019 and June 5, 2019, the Board considered the approval, for an additional annual period, of the Management Agreement between the Fund, on behalf of the Portfolios, and the Investment Manager. The Independent Directors were assisted in their review by independent legal counsel, who advised the Board on relevant legal standards and met with the Independent Directors in executive sessions separate from representatives of the Investment Manager.
Representatives of the Investment Manager discussed with the Board the Investment Manager’s written materials provided in advance of the meetings, including, at the June 5, 2019 meeting, additional information requested by the Independent Directors at the May 22, 2019 meeting.
Services Provided
The Investment Manager’s materials addressed, among other matters, the nature, extent and quality of services that the Investment Manager provides the Fund, including a discussion of the Invest-
96 Semi-Annual Report
ment Manager and its clients (of which the Lazard Funds complex of 39 active funds comprised approximately $29 billion of the approximately $235 billion of total assets under the management of the Investment Manager and its global affiliates as of March 31, 2019).
The Board considered the various services provided by the Investment Manager including the Investment Manager’s research, portfolio management and trading capabilities and oversight of day-to-day operations, including supervision of fund accounting and administration-related services and assistance in meeting legal and regulatory requirements, as well as regular reporting to, and support of, the Board. The Investment Manager’s representatives stated that the Investment Manager believes that the Fund and its shareholders continue to be able to obtain significant benefits as a result of the resources and support of the Investment Manager’s global research, portfolio management, trading, operations, risk management, technology and legal and compliance infrastructure. The Board also considered information provided by the Investment Manager regarding its personnel, resources, financial condition and experience; the Fund’s distribution channels and the relationships with various intermediaries; marketing and shareholder servicing activities on behalf of the Portfolios; and Portfolio asset flows and the growth or decline in asset levels. The Board accepted the assertion of representatives of the Investment Manager that the Fund benefits from the services and infrastructure provided by the Investment Manager and that such services and infrastructure are greater than those typically provided to a $29 billion fund complex not managed by a large, global firm such as the Investment Manager.
Comparative Fee, Expense Ratio and Performance Information
The Board reviewed information prepared by Strategic Insight, an independent provider of investment company data, comparing, for the fiscal year ended December 31, 2018, each Portfolio’s:
● | contractual management fee (i.e., without giving effect to any fee waivers), referred to in the Strategic Insight materials as “advisor fee,” expense ratio (net of any fee waivers or expense reimbursements) and performance (for one-, three-, five- and ten-year peri- |
Semi-Annual Report 97
ods ended March 31, 2019, as applicable) to those of a group of comparison funds selected by Strategic Insight (a “Group”); | |
● | advisor fee and expense ratio to a broader group of funds based on the Portfolio’s Morningstar category (an “Expense Universe”); and |
● | performance (for the one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to that of the funds in the Portfolio’s Morningstar category (a “Category”) and the benchmark index and the Portfolio’s performance for each of the four most recently completed calendar years, as applicable, and the first quarter of 2019, to that of the funds in the Portfolio’s Category and the benchmark index. |
The Strategic Insight materials outlined the process of construction of the Groups, Expense Universes and Categories, and representatives of the Investment Manager and independent legal counsel had previously discussed with the Board in further detail the methodologies used by Strategic Insight in constructing the Groups, Expense Universes and Categories, including how the methodologies could affect the results of the comparisons.
Advisor Fees and Expense Ratios.Representatives of the Investment Manager discussed the results of the Strategic Insight advisor fee and expense ratio comparisons with the Board. For the Emerging Markets Income Portfolio, the Investment Manager proposed to lower the management fee in the Management Agreement by 0.10%, with no diminution in services thereunder, and to lower the current expense limitation by 0.10%, and for the Explorer Total Return Portfolio the Investment Manager proposed to lower the current expense limitation by 0.10%. After giving effect to the proposed advisor fee and expense limitation reductions, the results of the Strategic Insight comparisons showed the advisor fees and expense ratios of the Portfolios were generally competitive within each Portfolio’s respective Group. The Board considered the comparisons, additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager and that the Investment Manager continues to voluntarily enter into expense limitation agreements for all of
98 Semi-Annual Report
the Portfolios, pursuant to which the Investment Manager currently was waiving advisor fees and/or reimbursing expenses.
As applicable, the Board also considered fees paid to the Investment Manager by any funds advised or sub-advised by the Investment Manager utilizing the same investment strategies as the Portfolios, as well as any separately managed accounts of the Investment Manager with similar investment objectives, policies and strategies (for each Portfolio, collectively with such funds, “Similar Accounts”). Representatives of the Investment Manager discussed the nature of the Similar Accounts and the significant differences in services provided by the Investment Manager to the different types of Similar Accounts as compared to the services provided to the Portfolios. The Board considered the relevance of the fee information provided for Similar Accounts, in light of the Investment Manager’s discussion of the significant differences in services provided, to evaluate the fees paid to the Investment Manager by the Portfolios.
Performance.When evaluating the performance of each Portfolio, the Board considered Strategic Insight’s performance analysis along with other information provided by the Investment Manager, including additional performance information, as well as additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager. The Board also received and would continue to receive regular updates and/or additional information (as requested by the Board) from the Investment Manager in respect of Portfolios with relative underperformance compared to the relevant Group, as well as any other Portfolios for which the Board requested additional information.
Investment Manager Profitability and Economies of Scale
The Board reviewed information prepared by the Investment Manager for each Portfolio concerning the estimated profitability percentage of the Management Agreement to the Investment Manager and its affiliates for the calendar year ended December 31, 2018 and the Investment Manager’s cost allocation methodology to compute an estimate of each Portfolio’s costs to the Investment Manager. The Investment Manager’s representatives
Semi-Annual Report 99
reviewed with the Board information provided on the Investment Manager’s brokerage practices and the Portfolios’ brokerage allocation, commission payments and soft dollar commissions and benefits (all as applicable). The Investment Manager’s representatives stated that neither the Investment Manager nor its affiliates receive any other significant indirect benefits from the Investment Manager acting as investment manager to the Portfolios. The representatives of the Investment Manager reminded the Board that the Investment Manager is continuing to support distribution relationships through direct payments from its or its affiliates’ own resources to third parties in connection with distribution and shareholder servicing and/or administrative and recordkeeping services, and noted that the Fund does not bear any related costs other than the 0.25% 12b-1 fee pursuant to the Distribution and Servicing Plan adopted for the Portfolios’ Open Shares.
The profitability percentages were within ranges determined by relevant court cases not to be so disproportionately large that they bore no reasonable relationship to the services rendered. The Board (1) considered the Investment Manager’s estimated profitability with respect to each Portfolio as part of their evaluation of the Portfolio’s fee under the Management Agreement, considered in relation to the mix of services provided by the Investment Manager (including the nature, extent and quality of such services), and (2) evaluated the profitability in light of the relevant circumstances for each Portfolio. Representatives of the Investment Manager and the Board discussed ways economies of scale could be realized and how they could be shared, including the Investment Manager’s reinvestment of profits back into its business, waiving or reducing Portfolio management fees and/or reimbursing expenses, adding discounts to a Portfolio’s management fee schedule as a Portfolio’s assets increase or by instituting management fees at inception that account for future scale. It was noted that each Portfolio had declining or generally stable assets, and/or a low level of assets, over the past calendar year so that the potential that the Investment Manager may have realized any economies of scale was reduced.
100 Semi-Annual Report
At the conclusion of these discussions, the Board expressed the opinion that it had been furnished with such information as may reasonably be necessary to make an informed business decision with respect to evaluation of the renewal of the Management Agreement. Based on its discussions and considerations as described above, with the assistance of independent legal counsel and in the exercise of its business judgment, the Board made the following conclusions and determinations.
● | The Board concluded that the nature, extent and quality of the services provided by the Investment Manager are adequate and appropriate, noting the benefits of the significant services and infrastructure associated with an approximately $235 billion global asset management business. |
● | The Board concluded that each Portfolio’s fee paid to the Investment Manager was appropriate under the circumstances and in light of the factors and the totality of the services provided. |
● | The Board, after considering the information provided and the totality of the relevant circumstances for each Portfolio, concluded that the investment performance of each Portfolio was acceptable or that, for any Portfolios that were not performing in accordance with expectations, the Board accepted that the Investment Manager was taking steps intended to improve performance and the Board would continue to monitor performance. |
● | The Board recognized that economies of scale may be realized, particularly as the assets of the Portfolios increase and determined that they would continue to consider potential material economies of scale. |
In evaluating the Management Agreement, the Board relied on the information described above, in addition to information provided by the Investment Manager throughout the year relating to the operations of the Fund and the investment management and other services provided under the Management Agreement, including information on the investment performance of the Portfolios in comparison to similar mutual funds and benchmark performance indices over various time periods; general market outlook as appli-
Semi-Annual Report 101
cable to the Portfolios; and compliance reports. The Board also relied on its previous knowledge, gained through meetings and other interactions with the Investment Manager, of the Investment Manager and the services provided to the Fund by the Investment Manager. The Board considered these conclusions and determinations in their totality and determined to approve the Fund’s Management Agreement for each Portfolio. In deciding whether to vote to approve the Management Agreement (as proposed to be revised, as applicable) for each Portfolio, each Director may have accorded different weights to different factors so that each Director may have had a different basis for his or her decision.
102 Semi-Annual Report
The Lazard Funds, Inc.
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
https://www.lazardassetmanagement.com
Investment Manager
Lazard Asset Management LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
Distributor
Lazard Asset Management Securities LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Custodian
State Street Bank and Trust Company
One Iron Street
Boston, Massachusetts 02210
Transfer Agent and Dividend Disbursing Agent
DST Asset Manager Solutions, Inc.
2000 Crown Colony Drive
Quincy, Massachusetts 02169
Telephone: 617-483-7000
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
30 Rockefeller Plaza
New York, New York 10112-0015
Legal Counsel
Proskauer Rose LLP
Eleven Times Square
New York, New York 10036-8299
http://www.proskauer.com
Lazard Asset Management LLC • 30 Rockefeller Plaza • New York, NY 10112 • www.lazardassetmanagement.com | ||
Performance information as of the most recent month end is available online at www.lazardassetmanagement.com. LZDPS031 | We Recycle This document is printed on recycled paper. |
Lazard Funds
Semi-Annual Report
June 30, 2019
Equity Funds
Lazard Developing Markets Equity Portfolio
Lazard Emerging Markets Core Equity Portfolio
Lazard Emerging Markets Equity Advantage Portfolio
Lazard Emerging Markets Equity Blend Portfolio
Lazard Emerging Markets Equity Portfolio
Lazard Equity Franchise Portfolio
Lazard Global Equity Select Portfolio
Lazard Global Listed Infrastructure Portfolio
Lazard Global Strategic Equity Portfolio
Lazard International Quality Growth Portfolio
Lazard International Equity Advantage Portfolio
Lazard International Equity Concentrated Portfolio
Lazard International Equity Portfolio
Lazard International Equity Select Portfolio
Lazard International Equity Value Portfolio
Lazard International Small Cap Equity Portfolio
Lazard International Strategic Equity Portfolio
Lazard Managed Equity Volatility Portfolio
Lazard US Equity Concentrated Portfolio
Lazard US Equity Select Portfolio
Lazard US Realty Equity Portfolio
Lazard US Small-Mid Cap Equity Portfolio
Important Information on Paperless Delivery
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports like this one will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. Shareholders who hold accounts directly with the Fund may elect to receive shareholder reports and other communications from the Fund electronically by signing up for paperless delivery at www.icsdelivery.com/lazardassetmanagement. If you own these shares through a financial intermediary, you may contact your financial intermediary.
You may elect to receive all future reports in paper free of charge. You can inform the Fund that you wish to continue receiving paper copies of your shareholder reports by following the instructions included with this disclosure and visiting www.fundreports.com. If you own these shares through a financial intermediary, you may contact your financial intermediary or follow instructions included with this disclosure to elect to continue to receive paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with the fund complex or your financial intermediary.
PRIVACY NOTICE
WHAT DOES LAZARD DO WITH YOUR PERSONAL INFORMATION?
Financial companies choose how they share your personal information. U.S. federal law gives our clients the right to limit some but not all sharing. U.S. federal and other applicable law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
We do not disclose nonpublic personal information about our clients or former clients to third parties other than as described below.
Personal information we collect. We collect personal information about you in connection with our providing advisory services to you. The legal basis for our collection of your personal information is our contract with you and our legitimate business interest to provide contractual services to you. The collection of this information is necessary for us to be able to provide advisory services to you and the failure to provide such information will result in our inability to provide our services. This information includes your social security number (for U.S. persons) and may include other information such as your:
● | Assets and income; | |
● | Investment experience; | |
● | Transaction history; | |
● | Credit history; and | |
● | Wire transfer instructions. |
How we collect this information. We collect this information from you through various means. For example, when you give us your contact information, enter into an investment advisory contract with us, buy securities (i.e., interests in a fund) from us, direct us to buy or sell securities for your account, tell us where to send money, or make a wire transfer. We also may collect your personal information from other sources, such as our affiliates1 or other non-affiliated companies (such as credit bureaus).
1 | Our affiliates are companiesrelated to us by common ownership or control and can include both financial and nonfinancial companies. Non-affiliates are companiesnot related to us by common ownership or control and can include both financial and nonfinancial companies. |
How we use this information. All financial companies need to share customers’ personal information to run their everyday business and we use the personal information we collect from you for our everyday business purposes. These purposes may include for example:
● | To provide advisory services to you; | |
● | To open an account for you; | |
● | To process a transaction for your account; | |
● | To market products and services to you; and/or | |
● | To respond to court orders and legal investigations. |
If you are an investor located within a European Union country, please note that personal information may be collected, shared and/or stored outside of the European Union.
Disclosure to others.We may provide your personal information to our affiliates and to firms that assist us in servicing your account and have a need for such information, such as a broker, counterparty, fund administrator or third party service provider that aggregates data in a central repository for access by a broker, counterparty or fund administrator to provide its services. We may also disclose such information to service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you. We require third party service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you to protect the confidentiality of your information and to use the information only for the purposes for which we disclose the information to them. These sharing practices are consistent with applicable privacy and related laws, and in general, you may not limit our use of your personal information for these purposes under such laws. We note that the U.S. federal privacy laws only give you the right to limit the certain types of information sharing that we do not engage in (e.g., sharing with our affiliates certain information relating to your transaction history or creditworthiness for their use in marketing to you, or sharing any personal information with non-affiliates for them to market to you). We may also share your personal information with non-affiliates (such as a government agency or regulatory authority) as required by applicable law.
How we protect your personal information. To protect your personal information from unauthorized access and use, we use security measures that comply with applicable law. These measures include computer safeguards and secured files and buildings.
How long we keep your personal information. We retain your personal information for the duration of your advisory relationship with us and for a period of time thereafter as required by applicable law.
Your rights with respect to this information. If you are an investor located within a European Union country, you have the following rights with respect to your personal information:
● | The right to request and obtain a copy of your personal information that we maintain; | |
● | The right to correct your personal information that we maintain; | |
● | The right to request the erasure of your personal information from our systems, subject to applicable recordkeeping requirements applicable to us; and | |
● | The right to lodge a complaint with a supervisory authority. |
Who is providing this Privacy Notice. This Privacy Notice relates to the following entities:
● | Lazard Asset Management LLC | |
● | Lazard Asset Management (Canada), Inc.2 | |
● | Lazard Asset Management Securities LLC |
Who to contact with questions. If you have any questions about this Privacy Notice, please call (800) 823-6300 or visit our website at http://www.lazardassetmanagement.com.
2 | Lazard Asset Management (Canada), Inc. does not disclose any non-public personal information about its customers to any third party, except as permitted by or required by any applicable law, including the laws of the United States and Canada. |
The Lazard Funds, Inc.Table of Contents
Please consider a Portfolio’s investment objectives, risks, charges and expenses carefully before investing. For more complete information about The Lazard Funds, Inc. (the “Fund”), you may obtain a prospectus or summary prospectus by calling 800-823-6300, or online, at www.lazardassetmanagement.com. Read the prospectus or each Portfolio’s summary prospectus carefully before you invest. The prospectus and each Portfolio’s summary prospectus contain the investment objectives, risks, charges, expenses and other information about each Portfolio of the Fund, which are not detailed in this report.
Distributed by Lazard Asset Management Securities LLC.
Semi-Annual Report 1
The Lazard Funds, Inc.A Message from Lazard (unaudited)
Dear Shareholder,
Global markets registered strong gains in the first half of 2019. They reached near-record highs in April, thanks to strong corporate earnings and better-than-expected quarterly US GDP growth. However, heightened trade tensions and mixed economic data gave investors pause in May as China and the United States again raised tariffs on each other’s imports after trade talks stalled.
The US equity market rose strongly during the period, boosted by hopes that renewed trade negotiations and a potential interest rate cut by the Federal Reserve in July would keep the United States on strong economic footing. Financials, materials, and technology outperformed, while energy lagged against a backdrop of falling oil prices, concerns about global demand, and rising inventories. Volatility as measured by the CBOE Volatility Index (VIX) rose mildly but remained well below levels at the end of 2018.
European equity markets have been caught in the middle of opposing forces, mainly growing tensions around global trade and increasingly dovish central banks. This has pushed European government bond yields to fresh lows and caused bond-sensitive sectors to climb higher, further stretching valuations.
Emerging markets equities gained more than 10% year to date. The asset class’s performance was volatile over the latter half of the period, reflecting extraordinary uncertainty among investors about the geopolitical environment, particularly US actions on trade in May and early June. Emerging markets debt also delivered strong year-to-date returns, supported by liquidity from central banks. However, the global growth outlook has become more uncertain and current valuations provide less compensation for the increased risks.
In this environment, we believe it is becoming increasingly important for investors to be discerning, to focus on fundamentals and not short-term macro drivers, particularly as sentiment is vulnerable to rapid shifts. We are privileged that you have turned to Lazard
2 Semi-Annual Report
for your investment needs and value your continued confidence in our investment management capabilities.
Sincerely,
Lazard Asset Management LLC
Semi-Annual Report 3
The Lazard Funds, Inc.Performance Overviews (unaudited)
Lazard Developing Markets Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Developing Markets Equity Portfolio and MSCI Emerging Markets® Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | |||||
Year | Years | Years | |||||
Institutional Shares** | 2.00% | 2.41% | 5.77% | ||||
Open Shares** | 1.63% | 2.02% | 5.40% | ||||
MSCI Emerging Markets Index | 1.21% | 2.49% | 5.81% |
4 Semi-Annual Report
Lazard Emerging Markets Core Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Core Equity Portfolio and MSCI Emerging Markets Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Year | Inception | † | ||||
Institutional Shares** | 0.39% | 2.07% | 2.69% | ||||
Open Shares** | –0.05% | 1.68% | 2.30% | ||||
R6 Shares* | 0.48% | N/A | –5.92% | ||||
MSCI Emerging Markets Index | 1.21% | 2.49% | 2.74% (Institutional and Open Shares) | ||||
–5.31% (R6 Shares) |
† | The inception date for the Institutional and Open Shares was October 31, 2013 and for the R6 Shares was April 6, 2018. |
Semi-Annual Report 5
Lazard Emerging Markets Equity Advantage Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Equity Advantage Portfolio and MSCI Emerging Markets Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | 0.07% | 4.63% | |||
Open Shares** | –0.23% | 4.33% | |||
MSCI Emerging Markets Index | 1.21% | 3.71% |
† | The inception date for the Portfolio was May 29, 2015. |
Lazard Emerging Markets Equity Blend Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Equity Blend Portfolio and MSCI Emerging Markets Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Years | Inception | † | ||||
Institutional Shares** | 0.75% | 1.25% | 2.83% | ||||
Open Shares** | 0.44% | 0.97% | 2.53% | ||||
MSCI Emerging Markets Index | 1.21% | 2.49% | 3.92% |
† | The inception date for the Portfolio was May 28, 2010. |
6 Semi-Annual Report
Lazard Emerging Markets Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Equity Portfolio and MSCI Emerging Markets Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 2.57% | –0.44% | 5.42% | 6.50% | |||||
Open Shares** | 2.36% | –0.70% | 5.12% | 6.21% | |||||
R6 Shares** | 2.57% | N/A | N/A | 2.35% | |||||
MSCI Emerging Markets Index | 1.21% | 2.49% | 5.81% | 5.46% (Institutional Shares) | |||||
5.99% (Open Shares) | |||||||||
4.66% (R6 Shares) |
† | The inception date for the Institutional Shares was July 15, 1994, for the Open Shares was January 8, 1997 and for the R6 Shares was January 19, 2015. |
Semi-Annual Report 7
Lazard Equity Franchise Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Equity Franchise Portfolio and MSCI World®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | 5.61% | 6.51% | |||
Open Shares** | 5.33% | 6.19% | |||
MSCI World Index | 6.33% | 7.05% |
† | The inception date for the Portfolio was September 29, 2017. |
Lazard Global Equity Select Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Global Equity Select Portfolio and MSCI ACWI®*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Year | Inception | † | ||||
Institutional Shares** | 8.90% | 7.91% | 7.87% | ||||
Open Shares** | 8.65% | 7.57% | 7.57% | ||||
MSCI ACWI | 5.74% | 6.16% | 6.74% |
† | The inception date for the Portfolio was December 31, 2013. |
8 Semi-Annual Report
Lazard Global Listed Infrastructure Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Global Listed Infrastructure Portfolio, MSCI World Core Infrastructure (USD Hedged) Index, Global Listed Infrastructure Index (USD Hedged) and MSCI World Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Years | Inception | † | ||||
Institutional Shares** | 9.67% | 10.45% | 12.02% | ||||
Open Shares** | 9.39% | 10.18% | 11.69% | ||||
MSCI World Core Infrastructure (USD Hedged) Index | 17.39% | 9.29% | 10.87% | ||||
Global Listed Infrastructure Index (USD Hedged) | 16.09% | 9.56% | 10.07% | ||||
MSCI World Index | 6.33% | 6.60% | 8.98% |
† | The inception date for the Portfolio was December 31, 2009. |
Semi-Annual Report 9
Lazard Global Strategic Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Global Strategic Equity Portfolio and MSCI ACWI*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | 8.02% | 5.74% | |||
Open Shares** | 7.84% | 5.46% | |||
MSCI ACWI | 5.74% | 6.17% |
† | The inception date for the Portfolio was August 29, 2014. |
Lazard International Quality Growth Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Quality Growth Portfolio and MSCI AWI*
Average Annual Total Returns*
Periods Ended June 30, 2019
Since | |||
Inception | † | ||
Institutional Shares** | 20.30% | ||
Open Shares** | 20.00% | ||
MSCI ACWI | 13.60% |
† | The inception date for the Portfolio was December 31, 2018. |
Important Notice to Shareholders
Effective July 31, 2019, Lazard International Compounders Portfolio changed its name to Lazard International Quality Growth Portfolio.
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Lazard International Equity Advantage Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Equity Advantage Portfolio and MSCI EAFE®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | –2.72% | 1.83% | |||
Open Shares** | –2.93% | 1.54% | |||
MSCI EAFE Index | 1.08% | 3.11% |
† | The inception date for the Portfolio was May 29, 2015. |
Lazard International Equity Concentrated Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Equity Concentrated Portfolio and MSCI ACWI ex-US*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | 2.81% | 1.43% | |||
Open Shares** | 2.56% | 1.16% | |||
MSCI ACWI ex-US | 1.29% | 2.33% |
† | The inception date for the Portfolio was August 29, 2014. |
Semi-Annual Report 11
Lazard International Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Equity Portfolio and MSCI EAFE Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 2.61% | 1.76% | 7.43% | 5.87% | |||||
Open Shares** | 2.31% | 1.48% | 7.13% | 4.71% | |||||
R6 Shares** | 2.56% | N/A | N/A | 2.84% | |||||
MSCI EAFE Index | 1.08% | 2.25% | 6.90% | 5.25% (Institutional Shares) | |||||
4.82% (Open Shares) | |||||||||
3.81% (R6 Shares) |
† | The inception date for the Institutional Shares was October 29, 1991, for the Open Shares was January 23, 1997 and for the R6 Shares was April 1, 2015. |
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Lazard International Equity Select Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Equity Select Portfolio, MSCI ACWI ex-US and MSCI EAFE/ACWI ex-US Linked Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | |||||
Year | Years | Years | |||||
Institutional Shares** | 1.85% | 1.57% | 6.73% | ||||
Open Shares** | 1.47% | 1.25% | 6.39% | ||||
MSCI ACWI ex-US | 1.29% | 2.16% | 6.54% | ||||
MSCI EAFE/ACWI ex-US Linked Index | 1.29% | 2.16% | 6.10% |
Lazard International Equity Value Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Equity Value Portfolio and MSCI EAFE Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
Since | |||
Inception | † | ||
Institutional Shares** | –0.58% | ||
Open Shares** | –0.82% | ||
MSCI EAFE Index | 8.35% |
† | The inception date for the Portfolio was October 31, 2018. |
Semi-Annual Report 13
Lazard International Small Cap Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Small Cap Equity Portfolio and MSCI EAFE Small Cap®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | |||||
Year | Years | Years | |||||
Institutional Shares** | –11.67% | 2.40% | 9.18% | ||||
Open Shares** | –11.95% | 2.13% | 8.89% | ||||
MSCI EAFE Small Cap Index | –6.35% | 4.40% | 9.67% |
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Lazard International Strategic Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard International Strategic Equity Portfolio and MSCI EAFE Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 3.29% | 2.72% | 9.06% | 6.33% | |||||
Open Shares** | 3.06% | 2.46% | 8.78% | 5.04% | |||||
R6 Shares** | 3.36% | N/A | N/A | 4.84% | |||||
MSCI EAFE Index | 1.08% | 2.25% | 6.90% | 4.37% (Institutional Shares) | |||||
3.45% (Open Shares) | |||||||||
5.22% (R6 Shares) |
† | The inception date for the Institutional Shares was October 31, 2005, for the Open Shares was February 3, 2006 and for the R6 Shares was January 19, 2015. |
Semi-Annual Report 15
Lazard Managed Equity Volatility Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Managed Equity Volatility Portfolio and MSCI World Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Since | ||||
Year | Inception | † | |||
Institutional Shares** | 8.47% | 7.34% | |||
Open Shares** | 8.15% | 7.02% | |||
MSCI World Index | 6.33% | 7.13% |
† | The inception date for the Portfolio was May 29, 2015. |
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Lazard US Equity Concentrated Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard US Equity Concentrated Portfolio, S&P 500®Index and Russell 1000 Value/S&P 500 Linked Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 11.35% | 10.57% | 13.88% | 8.50% | |||||
Open Shares** | 11.02% | 10.24% | 13.52% | 8.17% | |||||
R6 Shares** | 11.37% | N/A | N/A | 11.23% | |||||
S&P 500 Index | 10.42% | 10.71% | 14.70% | 8.81% | |||||
(Institutional and Open Shares) | |||||||||
14.36% (R6 Shares) | |||||||||
Russell 1000 Value/S&P 500 Linked Index | 10.42% | 10.71% | 14.40% | 8.08% (Institutional and Open Shares) | |||||
N/A (R6 Shares) |
† | The inception date for the Institutional and Open Shares was September 30, 2005 and for the R6 Shares was November 15, 2016. |
Semi-Annual Report 17
Lazard US Equity Select Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard US Equity Select Portfolio and S&P 500 Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 11.64% | 8.68% | 12.90% | 7.42% | |||||
Open Shares** | 11.24% | 8.35% | 12.56% | 7.11% | |||||
R6 Shares** | 11.63% | 8.72% | N/A | 9.54% | |||||
S&P 500 Index | 10.42% | 10.71% | 14.70% | 8.53% (Institutional and Open Shares) | |||||
11.41% (R6 Shares) |
† | The inception date for the Institutional and Open Shares was December 30, 2004 and for the R6 Shares was May 19, 2014. |
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Lazard US Realty Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Open Shares of Lazard US Realty Equity Portfolio, MSCI US REIT®Index*, and MSCI USA IMI Core Real Estate®Index
Average Annual Total Returns*
Periods Ended June 30, 2019
Institutional Shares | Open Shares | ||||||||||||
One | Five | Since | One | Five | Ten | ||||||||
Year | Years | Inception | † | Year | Years | Years | |||||||
US RealtyEquity Portfolio** | 11.06% | 7.48% | 12.36% | 10.74% | 7.18% | 16.33% | |||||||
MSCI US REITIndex | 9.66% | 6.44% | 10.25% | 9.66% | 6.44% | 14.14% | |||||||
MSCI USA IMI Core Real Estate® Index | 10.86% | 8.15% | 11.96% | 10.86% | 8.15% | 15.64% |
† | The inception date for the Institutional Shares was September 26, 2011. |
Semi-Annual Report 19
Lazard US Small-Mid Cap Equity Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard US Small-Mid Cap Equity Portfolio and Russell 2500®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | |||||
Year | Years | Years | |||||
Institutional Shares** | 1.18% | 7.02% | 13.42% | ||||
Open Shares** | 0.92% | 6.71% | 13.07% | ||||
Russell 2500 Index | 1.77% | 7.66% | 14.44% |
Notes to Performance Overviews:
* | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), State Street Bank and Trust Company, the Fund’s administrator (“State Street”) or DST Asset Manager Solutions, Inc., the Fund’s transfer and dividend distributing agent (“DST”); without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
Performance results do not include adjustments made for financial reporting purposes in accordance with US Generally Accepted Accounting Principles (“GAAP”), if any, and also exclude one-time adjustments related to reimbursed custodian out-of-pocket expenses (Note 3 in the Notes to Financial Statements) for Lazard International Small Cap Equity and Lazard US Small-Mid Cap Equity Portfolios and settlement proceeds received from class action lawsuits (Lazard Developing Markets Equity Portfolio Open Shares, Lazard International Equity and Lazard International Small Cap Equity Portfolios), and may differ from amounts reported in the financial highlights. | |
The performance quoted represents past performance. Current performance may be lower or higher than the performance quoted. Past performance is not indicative, or a guarantee, of future results; the investment return and principal value of the Portfolio will fluctuate, so that Portfolio shares, when redeemed, may be worth more or less than their original cost. Within the longer periods illustrated there may have been short-term fluctuations, counter to the overall trend of investment results, and no single period of any length may be taken as typical of what may be expected in future periods. The graph and table above do not reflect the deduction of taxes that a shareholder would pay on the Portfolio’s distributions or the redemption of Portfolio shares. | |
The performance data of the indices have been prepared from sources and data that the Investment Manager believes to be reliable, but no representation is made as to |
20 Semi-Annual Report
their accuracy. The indices are unmanaged, have no fees or costs and are not available for investment. | |
The MSCI Emerging Markets Index is a free-float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets. The MSCI Emerging Markets Index consists of 26 emerging markets country indices. | |
The MSCI World Index is a free-float-adjusted market capitalization index that is designed to measure global developed markets equity performance. The MSCI World Index consists of 23 developed markets country indices. | |
The MSCI ACWI is a free-float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The MSCI ACWI consists of 49 country indices comprising 23 developed and 26 emerging markets country indices. | |
The Global Listed Infrastructure Index (USD Hedged) is an unmanaged index created by the Investment Manager, which is the performance of the UBS Global 50/50 Infrastructure & Utilities®Index for all periods through March 31, 2015, when the index ceased to be published, and the FTSE Developed Core Infrastructure 50/50®Index for all periods thereafter. The UBS Global 50/50 Infrastructure & Utilities Index tracked a 50% exposure to the global developed markets utilities sector and a 50% exposure to the global developed markets infrastructure sector. The FTSE Developed Core Infrastructure 50/50 Index tracks a 50% exposure to the global developed markets utilities sector and a 50% exposure to the global developed markets infrastructure sector. | |
The MSCI EAFE Index (Europe, Australasia, Far East) is a free-float-adjusted market capitalization index that is designed to measure developed markets equity performance, excluding the United States and Canada. The MSCI EAFE Index consists of 21 developed markets country indices. | |
The MSCI ACWI ex-US is a free-float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets, excluding the United States. The MSCI ACWI ex-US consists of 48 country indices comprising 22 developed and 26 emerging markets country indices. | |
The MSCI EAFE/ACWI ex-US Linked Index is an unmanaged index created by the Investment Manager, which links the performance of the MSCI EAFE Index for all periods through June 30, 2010 (when Lazard International Equity Select Portfolio’s benchmark index changed) and the MSCI ACWI ex-US for all periods thereafter. | |
The MSCI EAFE Small Cap Index targets all companies with market capitalizations below that of the companies in the MSCI EAFE Index and up to 99% coverage of the free-float-adjusted market capitalization in each market (subject to minimum investability criteria and a universal minimum size range). The MSCI EAFE Small Cap Index consists of 21 developed markets country indices. | |
The S&P 500 Index is a market capitalization-weighted index of 500 companies in leading industries of the US economy. | |
The Russell 1000 Value/S&P 500 Linked Index is an unmanaged index created by the Investment Manager, which links the performance of the Russell 1000®Value Index for all periods through May 30, 2012 (when Lazard US Equity Concentrated Portfolio’s investment strategy changed) and the S&P 500 Index for all periods thereafter. | |
The Russell 1000 Value Index measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values. The Russell 1000 Index measures the performance of the large-cap segment of the US |
Semi-Annual Report 21
equity universe. It includes approximately 1000 of the largest securities based on a combination of their market cap and current index membership. | |
The MSCI US REIT Index is a free-float-adjusted market capitalization index that is comprised of equity REITs. The index is based on its parent index, the MSCI USA IMI®, which captures large, mid and small caps securities. With 151 constituents, the MSCI US REIT Index represents about 99% of the US REIT universe and securities are classified in the Equity REITs Industry (under the Real Estate sector) according to the GICS. It however excludes Mortgage REITs and selected Specialized REITs. | |
The MSCI USA IMI Core Real Estate Index is a free-float-adjusted market capitalization index that consists of large, mid and small cap stocks engaged in the ownership, development and management of specific core property type real estate. The index excludes companies, such as real estate services and real estate financing companies that do not own properties. | |
The MSCI World Core Infrastructure Index (the “Infrastructure Index”) captures large and mid-cap securities across the 23 developed market countries. The Infrastructure Index is designed to represent the performance of listed companies within the developed markets that are engaged in core industrial infrastructure activities. Note that Lazard Infrastructure invests in a range of companies globally, not specifically developed markets countries. The Global Listed Infrastructure Index (USD Hedged) will be replaced with the MSCI World Core Infrastructure Index (Hedged). The Investment Manager believes that the new index is an appropriate alternative to the prior index. | |
The Russell 2500 Index measures the performance of the small-to mid-cap segment of the US equity universe, commonly referred to as “smid” cap. The Russell 2500 Index is a subset of the Russell 3000®Index. The Russell 3000 Index measures the performance of the largest 3000 US companies, representing approximately 98% of the investable US equity market. The Russell 2500 Index includes approximately 2500 of the smallest securities based on a combination of their market cap and current index membership. | |
** | The performance of Institutional Shares, Open Shares and R6 Shares may vary, primarily based on the differences in fees borne by shareholders investing in different classes. |
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The Lazard Funds, Inc.
Information About Your Portfolio’s Expenses (unaudited)
Expense Example
As a shareholder in a Portfolio of the Fund, you incur ongoing costs, including management fees, distribution and service (12b-1) fees (Open Shares only), and other expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the six month period from January 1, 2019 through June 30, 2019 and held for the entire period.
Actual Expenses
For each Share class of the Portfolios, the first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000=8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
For each Share class of the Portfolios, the second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the class’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other mutual funds.
Semi-Annual Report 23
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
Developing Markets Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,168.10 | $6.13 | 1.14% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.14 | $5.71 | 1.14% |
Open Shares | ||||
Actual | $1,000.00 | $1,165.50 | $7.68 | 1.43% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,017.70 | $7.15 | 1.43% |
Emerging Markets Core Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,123.40 | $6.11 | 1.16% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.04 | $5.81 | 1.16% |
Open Shares | ||||
Actual | $1,000.00 | $1,120.60 | $8.15 | 1.55% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,017.11 | $7.75 | 1.55% |
R6 Shares | ||||
Actual | $1,000.00 | $1,124.40 | $6.16 | 1.17% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.99 | $5.86 | 1.17% |
Emerging Markets Equity Advantage | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,118.60 | $5.78 | 1.10% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.34 | $5.51 | 1.10% |
Open Shares | ||||
Actual | $1,000.00 | $1,116.50 | $7.35 | 1.40% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,017.85 | $7.00 | 1.40% |
24 Semi-Annual Report
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
Emerging Markets Equity Blend | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,148.70 | $6.13 | 1.15% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.09 | $5.76 | 1.15% |
Open Shares | ||||
Actual | $1,000.00 | $1,148.60 | $7.62 | 1.43% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,017.70 | $7.15 | 1.43% |
Emerging Markets Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,104.00 | $5.63 | 1.08% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.44 | $5.41 | 1.08% |
Open Shares | ||||
Actual | $1,000.00 | $1,102.80 | $6.93 | 1.33% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.20 | $6.66 | 1.33% |
R6 Shares | ||||
Actual | $1,000.00 | $1,104.00 | $5.63 | 1.08% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.44 | $5.41 | 1.08% |
Equity Franchise | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,129.00 | $5.01 | 0.95% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.08 | $4.76 | 0.95% |
Open Shares | ||||
Actual | $1,000.00 | $1,126.70 | $6.33 | 1.20% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.84 | $6.01 | 1.20% |
Semi-Annual Report 25
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
Global Equity Select | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,186.90 | $5.69 | 1.05% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.59 | $5.26 | 1.05% |
Open Shares | ||||
Actual | $1,000.00 | $1,185.00 | $7.31 | 1.35% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.10 | $6.76 | 1.35% |
Global Listed Infrastructure | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,143.80 | $5.00 | 0.94% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.13 | $4.71 | 0.94% |
Open Shares | ||||
Actual | $1,000.00 | $1,143.00 | $6.38 | 1.20% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.84 | $6.01 | 1.20% |
Global Strategic Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,189.00 | $5.43 | 1.00% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.84 | $5.01 | 1.00% |
Open Shares | ||||
Actual | $1,000.00 | $1,190.20 | $7.06 | 1.30% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.35 | $6.51 | 1.30% |
International Quality Growth | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,203.00 | $4.64 | 0.85% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.58 | $4.26 | 0.85% |
Open Shares | ||||
Actual | $1,000.00 | $1,200.00 | $5.89 | 1.08% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.44 | $5.41 | 1.08% |
26 Semi-Annual Report
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
International Equity Advantage | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,114.90 | $4.72 | 0.90% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.33 | $4.51 | 0.90% |
Open Shares | ||||
Actual | $1,000.00 | $1,113.80 | $6.29 | 1.20% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.84 | $6.01 | 1.20% |
International Equity Concentrated | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,179.90 | $5.13 | 0.95% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.08 | $4.76 | 0.95% |
Open Shares | ||||
Actual | $1,000.00 | $1,178.40 | $6.75 | 1.25% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.60 | $6.26 | 1.25% |
International Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,155.60 | $4.33 | 0.81% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.78 | $4.06 | 0.81% |
Open Shares | ||||
Actual | $1,000.00 | $1,153.70 | $5.66 | 1.06% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.54 | $5.31 | 1.06% |
R6 Shares | ||||
Actual | $1,000.00 | $1,155.20 | $4.28 | 0.80% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.83 | $4.01 | 0.80% |
Semi-Annual Report 27
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
International Equity Select | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,151.20 | $5.33 | 1.00% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.84 | $5.01 | 1.00% |
Open Shares | ||||
Actual | $1,000.00 | $1,149.40 | $7.19 | 1.35% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.10 | $6.76 | 1.35% |
International Equity Value | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,086.40 | $4.91 | 0.95% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.08 | $4.76 | 0.95% |
Open Shares | ||||
Actual | $1,000.00 | $1,085.40 | $6.20 | 1.20% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.84 | $6.01 | 1.20% |
International Small Cap Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,142.70 | $5.95 | 1.12% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.24 | $5.61 | 1.12% |
Open Shares | ||||
Actual | $1,000.00 | $ 1,141.40 | $7.33 | 1.38% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $ 1,017.95 | $6.90 | 1.38% |
International Strategic Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,154.40 | $4.27 | 0.80% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.83 | $4.01 | 0.80% |
Open Shares | ||||
Actual | $1,000.00 | $1,153.00 | $5.61 | 1.05% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.59 | $5.26 | 1.05% |
R6 Shares | ||||
Actual | $1,000.00 | $1,155.00 | $4.27 | 0.80% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.83 | $4.01 | 0.80% |
28 Semi-Annual Report
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
Managed Equity Volatility | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,149.80 | $4.00 | 0.75% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.08 | $3.76 | 0.75% |
Open Shares | ||||
Actual | $1,000.00 | $1,149.00 | $5.59 | 1.05% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.59 | $5.26 | 1.05% |
US Equity Concentrated | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,216.40 | $4.18 | 0.76% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.03 | $3.81 | 0.76% |
Open Shares | ||||
Actual | $1,000.00 | $1,214.80 | $5.71 | 1.04% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.64 | $5.21 | 1.04% |
R6 Shares | ||||
Actual | $1,000.00 | $1,216.70 | $4.23 | 0.77% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.98 | $3.86 | 0.77% |
US Equity Select | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,185.70 | $4.06 | 0.75% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.08 | $3.76 | 0.75% |
Open Shares | ||||
Actual | $1,000.00 | $1,183.90 | $5.69 | 1.05% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.59 | $5.26 | 1.05% |
R6 Shares | ||||
Actual | $1,000.00 | $1,186.70 | $4.07 | 0.75% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.08 | $3.76 | 0.75% |
Semi-Annual Report 29
Ending | Annualized | |||
Beginning | Account | Expenses Paid | Expense Ratio | |
Account Value | Value | During Period* | During Period | |
Portfolio | 1/1/19 | 6/30/19 | 1/1/19 - 6/30/19 | 1/1/19 - 6/30/19 |
US Realty Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,206.10 | $5.47 | 1.00% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.84 | $5.01 | 1.00% |
Open Shares | ||||
Actual | $1,000.00 | $1,204.50 | $6.94 | 1.27% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.50 | $6.36 | 1.27% |
US Small-Mid Cap Equity | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,215.10 | $4.94 | 0.90% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.33 | $4.51 | 0.90% |
Open Shares | ||||
Actual | $1,000.00 | $1,213.40 | $6.42 | 1.17% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.99 | $5.86 | 1.17% |
* | Expenses are equal to the annualized expense ratio, net of expenses waivers and reimbursements, of each Share class multiplied by the average account value over the period, multiplied by 181/365 (to reflect one-half year period). |
30 Semi-Annual Report
Portfolio Holdings Presented by Asset Class/Sector June 30, 2019 (unaudited)
Lazard | ||||||||||||||||
Lazard | Lazard | Emerging | Lazard | |||||||||||||
Developing | Emerging | Markets | Emerging | |||||||||||||
Markets | Markets Core | Equity | Markets | |||||||||||||
Equity | Equity | Advantage | Equity Blend | |||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||
Equity | ||||||||||||||||
Communication Services | 14.0 | % | 12.3 | % | 11.9 | % | 13.8 | % | ||||||||
Consumer Discretionary | 8.6 | 11.1 | 12.4 | 7.3 | ||||||||||||
Consumer Staples | 1.1 | 3.4 | 6.4 | 3.3 | ||||||||||||
Energy | 9.0 | 7.5 | 7.8 | 7.2 | ||||||||||||
Financials | 29.2 | 29.8 | 23.5 | 28.0 | ||||||||||||
Health Care | 4.3 | 0.9 | 2.5 | 2.8 | ||||||||||||
Industrials | 11.8 | 6.2 | 6.3 | 9.5 | ||||||||||||
Information Technology | 12.5 | 14.1 | 15.7 | 16.2 | ||||||||||||
Materials | 4.4 | 12.2 | 7.1 | 3.8 | ||||||||||||
Real Estate | — | 1.1 | 2.7 | 0.2 | ||||||||||||
Utilities | 2.7 | — | 1.9 | 1.9 | ||||||||||||
Short-Term Investments | 2.4 | 1.4 | 1.8 | 6.0 | ||||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||
Lazard | ||||||||||||||||
Emerging | Lazard | Lazard | Lazard | |||||||||||||
Markets | Equity | Global | Global Listed | |||||||||||||
Equity | Franchise | Equity Select | Infrastructure | |||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||
Equity | ||||||||||||||||
Communication Services | 11.9 | % | 11.3 | % | 4.9 | % | 6.4 | % | ||||||||
Consumer Discretionary | 6.5 | 20.4 | 8.9 | — | ||||||||||||
Consumer Staples | 6.4 | 4.7 | 13.3 | — | ||||||||||||
Energy | 11.3 | — | 0.8 | — | ||||||||||||
Financials | 28.3 | — | 19.8 | — | ||||||||||||
Health Care | 0.6 | 22.1 | 13.9 | — | ||||||||||||
Industrials | 5.3 | 16.7 | 16.2 | 40.5 | ||||||||||||
Information Technology | 18.7 | 12.8 | 14.2 | — | ||||||||||||
Materials | 6.4 | — | 1.9 | — | ||||||||||||
Real Estate | — | — | 1.0 | — | ||||||||||||
Utilities | 0.9 | 9.3 | — | 45.3 | ||||||||||||
Short-Term Investments | 3.7 | 2.7 | 5.1 | 7.8 | ||||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
* | Represents percentage of total investments. |
Semi-Annual Report 31
Lazard | Lazard | Lazard | ||||||||||||||
Global | Lazard | International | International | |||||||||||||
Strategic | International | Equity | Equity | |||||||||||||
Equity | Quality Growth | Advantage | Concentrated | |||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||
Equity | ||||||||||||||||
Communication Services | 12.6 | % | 7.0 | % | 4.8 | % | 8.2 | % | ||||||||
Consumer Discretionary | 6.2 | 12.4 | 9.6 | 7.0 | ||||||||||||
Consumer Staples | 7.4 | 5.1 | 11.4 | 7.2 | ||||||||||||
Energy | 3.0 | — | 6.8 | 7.2 | ||||||||||||
Financials | 19.8 | 20.3 | 16.2 | 21.8 | ||||||||||||
Health Care | 16.6 | 11.6 | 12.4 | 9.9 | ||||||||||||
Industrials | 13.0 | 26.4 | 14.9 | 8.8 | ||||||||||||
Information Technology | 14.4 | 11.4 | 6.1 | 18.3 | ||||||||||||
Materials | 2.6 | 2.1 | 6.9 | 2.6 | ||||||||||||
Real Estate | — | — | 4.1 | 2.6 | ||||||||||||
Utilities | — | — | 4.2 | 2.0 | ||||||||||||
Short-Term Investments | 4.4 | 3.7 | 2.6 | 4.4 | ||||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||
Lazard | ||||||||||||||||
Lazard | Lazard | Lazard | International | |||||||||||||
International | International | International | Small Cap | |||||||||||||
Equity | Equity Select | Equity Value | Equity | |||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||
Equity | ||||||||||||||||
Communication Services | 7.8 | % | 8.4 | % | 8.0 | % | 10.5 | % | ||||||||
Consumer Discretionary | 7.1 | 9.1 | 16.7 | 12.6 | ||||||||||||
Consumer Staples | 9.1 | 7.0 | 7.8 | 6.3 | ||||||||||||
Energy | 6.2 | 6.3 | 3.9 | 1.0 | ||||||||||||
Financials | 18.3 | 22.4 | 21.3 | 10.8 | ||||||||||||
Health Care | 9.8 | 10.4 | — | 8.9 | ||||||||||||
Industrials | 17.9 | 15.9 | 14.8 | 23.5 | ||||||||||||
Information Technology | 7.3 | 9.0 | 12.0 | 13.8 | ||||||||||||
Materials | 7.4 | 2.4 | 6.6 | 1.9 | ||||||||||||
Real Estate | 2.8 | 1.4 | — | 9.6 | ||||||||||||
Utilities | 2.7 | 3.5 | 4.3 | 0.9 | ||||||||||||
Short-Term Investments | 3.6 | 4.2 | 4.6 | 0.2 | ||||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % |
* | Represents percentage of total investments. |
32 Semi-Annual Report
Lazard | Lazard | |||||||||||||||
International | Managed | Lazard US | ||||||||||||||
Strategic | Equity | Equity | Lazard US | |||||||||||||
Equity | Volatility | Concentrated | Equity Select | |||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||
Equity | ||||||||||||||||
Communication Services | 9.4 | % | 7.0 | % | 8.6 | % | 7.1 | % | ||||||||
Consumer Discretionary | 8.1 | 10.1 | 6.7 | 9.6 | ||||||||||||
Consumer Staples | 9.6 | 15.3 | 8.2 | 7.9 | ||||||||||||
Energy | 3.4 | 1.7 | — | 6.2 | ||||||||||||
Financials | 26.4 | 12.9 | 8.4 | 13.4 | ||||||||||||
Health Care | 9.8 | 12.9 | 22.4 | 19.3 | ||||||||||||
Industrials | 19.7 | 10.5 | 6.0 | 9.4 | ||||||||||||
Information Technology | 4.6 | 8.0 | 28.7 | 21.6 | ||||||||||||
Materials | 2.1 | 3.5 | 5.0 | 0.9 | ||||||||||||
Real Estate | 1.8 | 6.8 | — | 1.7 | ||||||||||||
Utilities | 1.6 | 8.3 | — | — | ||||||||||||
Short-Term Investments | 3.5 | 3.0 | 6.0 | 2.9 | ||||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||
Lazard US | ||||||||||||||||
Lazard US | Small-Mid | |||||||||||||||
Realty Equity | Cap Equity | |||||||||||||||
Asset Class/Sector* | Portfolio | Portfolio | ||||||||||||||
Equity | ||||||||||||||||
Communication Services | — | % | 2.5 | % | ||||||||||||
Consumer Discretionary | 2.3 | 10.2 | ||||||||||||||
Consumer Staples | — | 0.8 | ||||||||||||||
Energy | — | 1.7 | ||||||||||||||
Financials | — | 16.3 | ||||||||||||||
Health Care | — | 14.2 | ||||||||||||||
Industrials | — | 17.0 | ||||||||||||||
Information Technology | — | 15.0 | ||||||||||||||
Materials | — | 6.2 | ||||||||||||||
Real Estate | 96.3 | 12.0 | ||||||||||||||
Utilities | — | 4.1 | ||||||||||||||
Short-Term Investments | 1.4 | — | ||||||||||||||
Total Investments | 100.0 | % | 100.0 | % |
* | Represents percentage of total investments. |
Semi-Annual Report 33
The Lazard Funds, Inc.Portfolios of Investments
June 30, 2019 (unaudited)
The accompanying notes are an integral part of these financial statements.
34 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Developing Markets Equity Portfolio (continued) | ||||||||
Colombia | 2.6% | ||||||||
Bancolombia SA Sponsored ADR | 124,747 | $ | 6,367,087 | |||||
Hong Kong | 1.7% | ||||||||
China Gas Holdings, Ltd. | 604,800 | 2,244,946 | ||||||
Techtronic Industries Co., Ltd. | 240,002 | 1,840,515 | ||||||
4,085,461 | ||||||||
India | 9.4% | ||||||||
HDFC Bank, Ltd. ADR | 52,985 | 6,890,169 | ||||||
ICICI Bank, Ltd. Sponsored ADR | 556,001 | 7,000,053 | ||||||
Reliance Industries, Ltd. | 273,801 | 4,970,483 | ||||||
Shriram Transport Finance Co., Ltd. | 246,476 | 3,877,303 | ||||||
22,738,008 | ||||||||
Indonesia | 2.7% | ||||||||
PT Bank Rakyat Indonesia (Persero) Tbk | 21,103,700 | 6,515,012 | ||||||
Macau | 0.7% | ||||||||
SJM Holdings, Ltd. | 1,566,000 | 1,784,448 | ||||||
Mexico | 1.6% | ||||||||
Grupo Financiero Banorte SAB de CV, Class O | 660,357 | 3,831,318 | ||||||
Peru | 2.4% | ||||||||
Credicorp, Ltd. | 25,255 | 5,781,122 | ||||||
Philippines | 1.5% | ||||||||
BDO Unibank, Inc. | 1,316,585 | 3,598,668 | ||||||
Portugal | 2.7% | ||||||||
Galp Energia SGPS SA | 417,220 | 6,431,898 | ||||||
Russia | 8.5% | ||||||||
Mail.Ru Group, Ltd. GDR (*) | 134,482 | 3,431,431 | ||||||
Novatek OAO Sponsored GDR | 25,047 | 5,324,556 | ||||||
Sberbank of Russia PJSC | 1,189,307 | 4,483,676 | ||||||
Yandex NV Class A (*) | 189,335 | 7,194,730 | ||||||
20,434,393 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 35
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Developing Markets Equity Portfolio (continued) | ||||||||
South Africa | 3.8% | ||||||||
Capitec Bank Holdings, Ltd. | 52,897 | $ | 4,878,124 | |||||
Petra Diamonds, Ltd. (*) | 1,779,300 | 443,620 | ||||||
Standard Bank Group, Ltd. | 275,153 | 3,843,029 | ||||||
9,164,773 | ||||||||
South Korea | 9.1% | ||||||||
Doosan Bobcat, Inc. | 60,939 | 1,921,860 | ||||||
NCSoft Corp. | 6,553 | 2,706,791 | ||||||
Netmarble Corp. (*) | 18,439 | 1,806,723 | ||||||
Partron Co., Ltd. | 164,575 | 2,529,881 | ||||||
S-Oil Corp. | 21,363 | 1,548,136 | ||||||
Samsung Biologics Co., Ltd. (*) | 4,162 | 1,154,616 | ||||||
Samsung Electronics Co., Ltd. | 208,137 | 8,486,157 | ||||||
WONIK IPS Co., Ltd. | 92,747 | 1,923,842 | ||||||
22,078,006 | ||||||||
Taiwan | 8.4% | ||||||||
Airtac International Group | 159,000 | 1,789,926 | ||||||
ASE Technology Holding Co., Ltd. | 896,289 | 1,765,324 | ||||||
Bizlink Holding, Inc. | 743,000 | 5,160,345 | ||||||
Catcher Technology Co., Ltd. | 216,670 | 1,554,588 | ||||||
Largan Precision Co., Ltd. | 14,860 | 1,847,920 | ||||||
MediaTek, Inc. | 210,000 | 2,129,363 | ||||||
Silicon Motion Technology Corp. ADR | 67,500 | 2,995,650 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 392,000 | 2,990,385 | ||||||
20,233,501 | ||||||||
United Arab Emirates | 1.3% | ||||||||
NMC Health PLC | 100,073 | 3,054,209 | ||||||
United Kingdom | 1.6% | ||||||||
KAZ Minerals PLC | 487,080 | 3,749,738 | ||||||
Total Common Stocks (Cost $211,566,074) | 231,051,261 |
The accompanying notes are an integral part of these financial statements.
36 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Developing Markets Equity Portfolio (concluded) | ||||||||
Preferred Stocks | 2.2% | ||||||||
Brazil | 2.2% | ||||||||
Banco Bradesco SA ADR (Cost $4,482,064) | 541,863 | $ | 5,321,095 | |||||
Short-Term Investments | 2.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $5,783,404) | 5,783,404 | 5,783,404 | ||||||
Total Investments | 100.3% (Cost $221,831,542) | $ | 242,155,760 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.3)% | (666,434 | ) | ||||||
Net Assets | 100.0% | $ | 241,489,326 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 37
The accompanying notes are an integral part of these financial statements.
38 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Core Equity Portfolio (continued) | ||||||||
Colombia | 1.2% | ||||||||
Bancolombia SA Sponsored ADR | 53,100 | $ | 2,710,224 | |||||
Hong Kong | 1.2% | ||||||||
Techtronic Industries Co., Ltd. | 366,500 | 2,810,596 | ||||||
Hungary | 1.0% | ||||||||
MOL Hungarian Oil & Gas PLC | 200,590 | 2,226,738 | ||||||
India | 10.6% | ||||||||
HDFC Bank, Ltd. ADR | 70,369 | 9,150,785 | ||||||
Hindalco Industries, Ltd. | 1,036,864 | 3,110,104 | ||||||
Hindustan Zinc, Ltd. | 582,947 | 2,061,459 | ||||||
Infosys, Ltd. Sponsored ADR | 271,715 | 2,907,351 | ||||||
Maruti Suzuki India, Ltd. | 25,295 | 2,394,610 | ||||||
Motherson Sumi Systems, Ltd. | 726,823 | 1,284,069 | ||||||
UPL, Ltd. | 271,619 | 3,689,664 | ||||||
24,598,042 | ||||||||
Indonesia | 2.3% | ||||||||
PT Bank Mandiri (Persero) Tbk | 5,778,400 | 3,286,225 | ||||||
PT Telekomunikasi Indonesia (Persero) Tbk Sponsored ADR | 71,360 | 2,086,567 | ||||||
5,372,792 | ||||||||
Luxembourg | 1.7% | ||||||||
Tenaris SA ADR | 50,700 | 1,333,917 | ||||||
Ternium SA Sponsored ADR | 112,750 | 2,528,983 | ||||||
3,862,900 | ||||||||
Mexico | 3.2% | ||||||||
Arca Continental SAB de CV | 366,445 | 1,982,693 | ||||||
Gruma SAB de CV, Class B | 181,383 | 1,702,342 | ||||||
Grupo Aeroportuario del Pacifico SAB de CV ADR | 15,400 | 1,606,374 | ||||||
Grupo Financiero Banorte SAB de CV, Class O | 370,400 | 2,149,020 | ||||||
7,440,429 | ||||||||
Peru | 1.2% | ||||||||
Credicorp, Ltd. | 11,550 | 2,643,911 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 39
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Core Equity Portfolio (continued) | ||||||||
Philippines | 2.0% | ||||||||
BDO Unibank, Inc. | 1,240,481 | $ | 3,390,650 | |||||
GT Capital Holdings, Inc. | 66,131 | 1,213,599 | ||||||
4,604,249 | ||||||||
Portugal | 0.9% | ||||||||
Galp Energia SGPS SA | 139,849 | 2,155,924 | ||||||
Russia | 7.1% | ||||||||
LUKOIL PJSC Sponsored ADR | 92,354 | 7,796,946 | ||||||
Sberbank of Russia PJSC Sponsored ADR (London) | 333,997 | 5,137,603 | ||||||
Sberbank of Russia PJSC Sponsored ADR (United States) | 53,682 | 820,261 | ||||||
Severstal PJSC GDR | 165,126 | 2,786,204 | ||||||
16,541,014 | ||||||||
South Africa | 5.4% | ||||||||
Barloworld, Ltd. | 144,678 | 1,315,264 | ||||||
FirstRand, Ltd. | 580,925 | 2,828,205 | ||||||
Mondi PLC | 139,740 | 3,186,805 | ||||||
Naspers, Ltd., N Shares | 13,031 | 3,165,673 | ||||||
The Bidvest Group, Ltd. | 153,818 | 2,068,272 | ||||||
12,564,219 | ||||||||
South Korea | 9.7% | ||||||||
DB Insurance Co., Ltd. | 36,416 | 1,869,681 | ||||||
NCSoft Corp. | 6,169 | 2,548,176 | ||||||
S-Oil Corp. | 19,336 | 1,401,243 | ||||||
Samsung Electronics Co., Ltd. | 293,500 | 11,966,575 | ||||||
SK Hynix, Inc. | 54,236 | 3,267,130 | ||||||
Woongjin Coway Co., Ltd. | 22,433 | 1,504,122 | ||||||
22,556,927 | ||||||||
Taiwan | 8.9% | ||||||||
Far EasTone Telecommunications Co., Ltd. | 880,000 | 2,218,567 | ||||||
Formosa Plastics Corp. | 1,095,000 | 4,040,058 | ||||||
Largan Precision Co., Ltd. | 17,000 | 2,114,040 | ||||||
Silicon Motion Technology Corp. ADR | 43,610 | 1,935,412 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR | 264,778 | 10,371,354 | ||||||
20,679,431 |
The accompanying notes are an integral part of these financial statements.
40 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Core Equity Portfolio (concluded) | ||||||||
Thailand | 1.4% | ||||||||
Bangkok Bank Public Co. Ltd. | 228,600 | $ | 1,484,287 | |||||
Kasikornbank Public Co. Ltd. | 272,800 | 1,685,680 | ||||||
3,169,967 | ||||||||
United Kingdom | 1.8% | ||||||||
Unilever NV NY Shares | 69,200 | 4,201,824 | ||||||
Total Common Stocks (Cost $215,679,016) | 225,441,086 | |||||||
Preferred Stocks | 0.8% | ||||||||
Brazil | 0.8% | ||||||||
Itau Unibanco Holding SA Sponsored ADR (Cost $1,772,552) | 204,043 | 1,922,085 | ||||||
Short-Term Investments | 1.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $3,290,034) | 3,290,034 | 3,290,034 | ||||||
Total Investments | 99.4% (Cost $220,741,602) | $ | 230,653,205 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.6% | 1,341,914 | |||||||
Net Assets | 100.0% | $ | 231,995,119 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 41
The accompanying notes are an integral part of these financial statements.
42 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
China Mengniu Dairy Co., Ltd. | 4,000 | $ | 15,497 | |||||
China Merchants Bank Co., Ltd., Class H | 19,500 | 97,368 | ||||||
China Mobile, Ltd. | 7,000 | 63,717 | ||||||
China Petroleum & Chemical Corp., Class H | 42,000 | 28,601 | ||||||
China Resources Cement Holdings, Ltd. | 12,000 | 11,596 | ||||||
China Resources Gas Group, Ltd. | 6,000 | 29,745 | ||||||
China Resources Land, Ltd. | 6,000 | 26,317 | ||||||
China SCE Group Holdings, Ltd. | 37,000 | 17,837 | ||||||
China Telecom Corp., Ltd., Class H | 198,000 | 99,701 | ||||||
China Unicom Hong Kong, Ltd. | 86,000 | 94,505 | ||||||
China Vanke Co., Ltd., Class H | 4,700 | 17,641 | ||||||
CNOOC, Ltd. | 62,000 | 106,667 | ||||||
Country Garden Holdings Co., Ltd. | 34,000 | 51,504 | ||||||
Country Garden Services Holdings Co., Ltd. | 13,000 | 29,954 | ||||||
CSPC Pharmaceutical Group, Ltd. | 34,000 | 54,604 | ||||||
Foshan Haitian Flavouring & Food Co., Ltd., Class A | 2,400 | 36,676 | ||||||
Fujian Sunner Development Co., Ltd., Class A | 4,900 | 18,093 | ||||||
G-bits Network Technology Xiamen Co., Ltd., Class A | 800 | 24,489 | ||||||
Great Wall Motor Co., Ltd. Class H | 24,500 | 17,577 | ||||||
Hangzhou Shunwang Technology Co., Ltd., Class A (*) | 8,400 | 19,204 | ||||||
Hualan Biological Engineering, Inc., Class A | 5,700 | 25,326 | ||||||
Huaxin Cement Co., Ltd., Class A | 6,580 | 19,451 | ||||||
Hubei Jumpcan Pharmaceutical Co., Ltd., Class A | 3,900 | 17,113 | ||||||
Industrial & Commercial Bank of China, Ltd., Class H | 118,000 | 85,913 | ||||||
Industrial Bank Co., Ltd., Class A | 22,000 | 58,702 | ||||||
Jiangsu Hengrui Medicine Co., Ltd., Class A | 1,800 | 17,314 | ||||||
LexinFintech Holdings, Ltd. ADR (*) | 1,560 | 17,410 | ||||||
Li Ning Co., Ltd. | 10,000 | 23,622 | ||||||
Longfor Group Holdings, Ltd. | 6,500 | 24,532 | ||||||
Momo, Inc. Sponsored ADR | 417 | 14,929 | ||||||
NetEase, Inc. ADR | 109 | 27,879 | ||||||
New Oriental Education & Technology Group, Inc. Sponsored ADR (*) | 259 | 25,014 | ||||||
PetroChina Co., Ltd., Class H | 124,000 | 68,225 | ||||||
PICC Property & Casualty Co., Ltd., Class H | 12,000 | 12,916 | ||||||
Ping An Bank Co., Ltd., Class A | 11,000 | 22,127 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 43
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
Ping An Insurance (Group) Co. of China, Ltd., Class H | 17,000 | $ | 204,608 | |||||
Postal Savings Bank of China Co., Ltd., Class H | 21,000 | 12,480 | ||||||
Sany Heavy Industry Co., Ltd., Class A | 11,200 | 21,369 | ||||||
Sinotruk Hong Kong, Ltd. | 12,000 | 20,797 | ||||||
Tangshan Jidong Cement Co., Ltd., Class A | 8,500 | 21,861 | ||||||
Tencent Holdings, Ltd. | 8,600 | 389,068 | ||||||
Tencent Music Entertainment Group ADR | 2,600 | 38,974 | ||||||
Tianneng Power International, Ltd. | 16,000 | 12,891 | ||||||
Times China Holdings, Ltd. | 13,000 | 26,088 | ||||||
Topchoice Medical Investment Corp., Class A (*) | 1,900 | 24,526 | ||||||
Weichai Power Co., Ltd., Class A | 25,700 | 46,073 | ||||||
YY, Inc. ADR (*) | 219 | 15,262 | ||||||
Zhengzhou Coal Mining Machinery Group Co., Ltd., Class A | 23,000 | 19,177 | ||||||
3,116,902 | ||||||||
Colombia | 0.4% | ||||||||
Ecopetrol SA Sponsored ADR | 2,173 | 39,744 | ||||||
Egypt | 0.3% | ||||||||
Commercial International Bank Egypt SAE ADR | 8,401 | 35,620 | ||||||
Greece | 0.1% | ||||||||
JUMBO SA | 668 | 12,915 | ||||||
Hong Kong | 0.4% | ||||||||
Lee & Man Paper Manufacturing, Ltd. | 19,000 | 13,264 | ||||||
Sino Biopharmaceutical, Ltd. | 28,500 | 29,227 | ||||||
42,491 | ||||||||
Hungary | 0.9% | ||||||||
Magyar Telekom Telecommunications PLC | 9,928 | 14,720 | ||||||
MOL Hungarian Oil & Gas PLC | 7,088 | 78,684 | ||||||
93,404 | ||||||||
India | 7.0% | ||||||||
Axis Bank, Ltd. GDR (*) | 921 | 53,605 | ||||||
Dr Reddy’s Laboratories, Ltd. ADR | 508 | 19,035 | ||||||
GAIL India, Ltd. GDR | 2,811 | 76,112 |
The accompanying notes are an integral part of these financial statements.
44 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
HDFC Bank, Ltd. ADR | 1,106 | $ | 143,824 | |||||
ICICI Bank, Ltd. Sponsored ADR | 3,932 | 49,504 | ||||||
Infosys, Ltd. Sponsored ADR | 10,432 | 111,623 | ||||||
Reliance Industries, Ltd. Sponsored GDR (*),(#) | 1,959 | 70,826 | ||||||
State Bank of India GDR (*) | 1,036 | 53,668 | ||||||
Vedanta, Ltd. ADR | 763 | 7,760 | ||||||
Wipro, Ltd. ADR | 13,892 | 60,152 | ||||||
WNS Holdings, Ltd. ADR (*) | 1,040 | 61,568 | ||||||
707,677 | ||||||||
Indonesia | 2.5% | ||||||||
PT Bank Central Asia Tbk | 31,700 | 67,319 | ||||||
PT Bank Mandiri (Persero) Tbk | 31,700 | 18,028 | ||||||
PT Bank Rakyat Indonesia (Persero) Tbk | 262,200 | 80,945 | ||||||
PT Gudang Garam Tbk | 6,800 | 37,006 | ||||||
PT Unilever Indonesia Tbk | 15,500 | 49,377 | ||||||
252,675 | ||||||||
Malaysia | 2.1% | ||||||||
AirAsia Group Berhad | 26,000 | 17,179 | ||||||
Bermaz Auto Berhad | 32,200 | 20,731 | ||||||
Genting Malaysia Berhad | 19,300 | 15,136 | ||||||
Hong Leong Bank Berhad | 5,300 | 24,370 | ||||||
Nestle Malaysia Berhad | 500 | 18,041 | ||||||
Petronas Chemicals Group Berhad | 29,800 | 60,584 | ||||||
RHB Bank Bhd | 44,700 | 60,466 | ||||||
216,507 | ||||||||
Mexico | 3.1% | ||||||||
Alfa SAB de CV, Class A | 29,000 | 28,496 | ||||||
America Movil SAB de CV, Class L Sponsored ADR | 5,709 | 83,123 | ||||||
Grupo Aeroportuario del Centro Norte SAB de CV | 7,600 | 46,415 | ||||||
Grupo Financiero Banorte SAB de CV, Class O | 8,400 | 48,736 | ||||||
Grupo Mexico SAB de CV, Series B | 6,000 | 15,933 | ||||||
Mexichem SAB de CV | 8,400 | 17,633 | ||||||
Wal-Mart de Mexico SAB de CV | 26,900 | 73,438 | ||||||
313,774 | ||||||||
Peru | 0.2% | ||||||||
Credicorp, Ltd. | 77 | 17,626 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 45
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
Philippines | 1.7% | ||||||||
Ayala Land, Inc. | 37,400 | $ | 37,097 | |||||
Cebu Air, Inc. | 21,780 | 38,706 | ||||||
DMCI Holdings, Inc. | 118,000 | 23,730 | ||||||
International Container Terminal Services, Inc. | 15,150 | 43,265 | ||||||
JG Summit Holdings, Inc. | 18,370 | 24,167 | ||||||
166,965 | ||||||||
Poland | 0.9% | ||||||||
Dino Polska SA (*) | 770 | 27,037 | ||||||
Enea SA (*) | 8,276 | 20,694 | ||||||
PGE Polska Grupa Energetyczna SA (*) | 4,497 | 11,557 | ||||||
PLAY Communications SA | 2,391 | 20,740 | ||||||
Tauron Polska Energia SA (*) | 25,536 | 11,723 | ||||||
91,751 | ||||||||
Russia | 5.2% | ||||||||
Gazprom PJSC Sponsored ADR | 9,877 | 72,364 | ||||||
LUKOIL PJSC Sponsored ADR | 1,328 | 112,116 | ||||||
MMC Norilsk Nickel PJSC ADR | 2,613 | 59,332 | ||||||
Novolipetsk Steel PJSC GDR | 1,986 | 50,206 | ||||||
Sberbank of Russia PJSC Sponsored ADR | 6,891 | 105,999 | ||||||
Severstal PJSC GDR | 2,481 | 41,862 | ||||||
Tatneft PJSC Sponsored ADR | 1,089 | 80,649 | ||||||
522,528 | ||||||||
South Africa | 3.9% | ||||||||
Anglo American Platinum, Ltd. | 1,363 | 81,098 | ||||||
AVI, Ltd. | 6,769 | 43,905 | ||||||
Capitec Bank Holdings, Ltd. | 443 | 40,853 | ||||||
Exxaro Resources, Ltd. | 1,226 | 15,014 | ||||||
FirstRand, Ltd. | 5,489 | 26,723 | ||||||
Motus Holdings, Ltd. | 1,649 | 8,567 | ||||||
Mr Price Group, Ltd. | 1,890 | 26,639 | ||||||
MTN Group, Ltd. | 2,331 | 17,665 | ||||||
Naspers, Ltd., N Shares | 569 | 138,229 | ||||||
398,693 |
The accompanying notes are an integral part of these financial statements.
46 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
South Korea | 13.5% | ||||||||
AfreecaTV Co., Ltd. | 384 | $ | 20,490 | |||||
Celltrion, Inc. (*) | 69 | 12,295 | ||||||
CJ Corp. | 125 | 10,942 | ||||||
Daelim Industrial Co., Ltd. | 554 | 55,215 | ||||||
Douzone Bizon Co., Ltd. | 356 | 19,198 | ||||||
GS Engineering & Construction Corp. | 612 | 21,457 | ||||||
Hana Financial Group, Inc. | 466 | 15,103 | ||||||
Hotel Shilla Co., Ltd. | 176 | 14,816 | ||||||
Hyundai Department Store Co., Ltd. | 174 | 12,458 | ||||||
Hyundai Marine & Fire Insurance Co., Ltd. | 819 | 20,201 | ||||||
Hyundai Mobis Co., Ltd. | 184 | 37,584 | ||||||
Industrial Bank of Korea | 4,472 | 54,449 | ||||||
KB Financial Group, Inc. ADR | 1,259 | 49,705 | ||||||
Kia Motors Corp. | 2,472 | 94,421 | ||||||
Koentec Co., Ltd. | 2,699 | 27,480 | ||||||
KT&G Corp. | 249 | 21,251 | ||||||
LG Chem, Ltd. | 71 | 21,862 | ||||||
LG Electronics, Inc. | 341 | 23,448 | ||||||
LG Household & Health Care, Ltd. | 51 | 58,038 | ||||||
LG Uplus Corp. | 4,724 | 59,369 | ||||||
NCSoft Corp. | 93 | 38,415 | ||||||
POSCO | 107 | 22,650 | ||||||
Samsung Electro-Mechanics Co., Ltd. | 258 | 21,899 | ||||||
Samsung Electronics Co., Ltd. GDR | 495 | 503,313 | ||||||
Samsung SDS Co., Ltd. | 202 | 37,600 | ||||||
Shinsegae International, Inc. | 73 | 13,486 | ||||||
SK Hynix, Inc. | 1,295 | 78,010 | ||||||
1,365,155 | ||||||||
Taiwan | 12.1% | ||||||||
Advantech Co., Ltd. | 8,000 | 68,055 | ||||||
Asia Cement Corp. | 24,000 | 36,715 | ||||||
Chailease Holding Co., Ltd. | 8,000 | 33,149 | ||||||
Delta Electronics, Inc. | 8,000 | 40,687 | ||||||
Eva Airways Corp. | 60,000 | 28,893 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 47
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (continued) | ||||||||
Feng TAY Enterprise Co., Ltd. | 9,000 | $ | 70,352 | |||||
International Games System Co., Ltd. | 3,000 | 28,986 | ||||||
Makalot Industrial Co., Ltd. | 5,000 | 33,865 | ||||||
Novatek Microelectronics Corp., Ltd. | 5,000 | 27,918 | ||||||
President Chain Store Corp. | 6,000 | 58,055 | ||||||
Rexon Industrial Corp., Ltd. | 7,000 | 19,115 | ||||||
St Shine Optical Co., Ltd. | 3,000 | 53,296 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR | 12,497 | 489,508 | ||||||
Taiwan Styrene Monomer | 21,000 | 16,621 | ||||||
Uni-President Enterprises Corp. | 12,000 | 31,948 | ||||||
Yuanta Financial Holding Co., Ltd. | 260,000 | 156,247 | ||||||
Zhen Ding Technology Holding, Ltd. | 8,000 | 25,660 | ||||||
1,219,070 | ||||||||
Thailand | 2.7% | ||||||||
Advanced Info Service Public Co. Ltd. (‡) | 4,700 | 33,410 | ||||||
Central Pattana Public Co. Ltd. NVDR | 8,200 | 20,054 | ||||||
CP ALL Public Co. Ltd. (‡) | 14,400 | 40,382 | ||||||
Home Product Center Public Co. Ltd. | 66,900 | 38,176 | ||||||
Krungthai Card Public Co. Ltd. NVDR | 28,600 | 40,366 | ||||||
PTT Exploration & Production Public Co. Ltd. (‡) | 4,100 | 18,048 | ||||||
Thanachart Capital Public Co., Ltd. NVDR | 27,900 | 50,510 | ||||||
Tisco Financial Group Public Co. Ltd. NVDR (‡) | 10,900 | 33,237 | ||||||
274,183 | ||||||||
Turkey | 1.0% | ||||||||
BIM Birlesik Magazalar AS | 1,303 | 17,923 | ||||||
Haci Omer Sabanci Holding AS | 9,844 | 14,604 | ||||||
Tekfen Holding AS | 3,410 | 15,301 | ||||||
Turk Telekomunikasyon AS (*) | 22,575 | 19,433 | ||||||
Turkiye Garanti Bankasi AS ADR (*) | 19,375 | 29,644 | ||||||
96,905 | ||||||||
United States | 0.8% | ||||||||
Yum China Holdings, Inc. | 1,666 | 76,969 | ||||||
Total Common Stocks (Cost $9,135,966) | 9,719,667 |
The accompanying notes are an integral part of these financial statements.
48 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Advantage Portfolio (concluded) | ||||||||
Preferred Stocks | 0.6% | ||||||||
Brazil | 0.6% | ||||||||
Banco Bradesco SA ADR (Cost $56,426) | 5,917 | $ | 58,105 | |||||
Short-Term Investments | 1.8% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $181,640) | 181,640 | 181,640 | ||||||
Total Investments | 98.6% (Cost $9,374,032) | $ | 9,959,412 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.4% | 140,861 | |||||||
Net Assets | 100.0% | $ | 10,100,273 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 49
The accompanying notes are an integral part of these financial statements.
50 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Blend Portfolio (continued) | ||||||||
CNOOC, Ltd. | 626,800 | $ | 1,078,370 | |||||
Consun Pharmaceutical Group, Ltd. | 549,000 | 376,728 | ||||||
Focused Photonics Hangzhou, Inc., Class A | 244,400 | 851,285 | ||||||
Huami Corp. ADR (*) | 15,945 | 159,450 | ||||||
JNBY Design, Ltd. | 314,000 | 575,963 | ||||||
NetEase, Inc. ADR | 13,684 | 3,499,957 | ||||||
Ping An Insurance (Group) Co. of China, Ltd., Class H | 169,500 | 2,040,058 | ||||||
Precision Tsugami China Corp., Ltd. | 220,000 | 235,411 | ||||||
Sinotrans, Ltd., Class H | 923,000 | 336,223 | ||||||
Tencent Holdings, Ltd. | 34,600 | 1,565,322 | ||||||
Tianyun International Holdings, Ltd. | 1,582,000 | 232,313 | ||||||
West China Cement, Ltd. | 2,984,000 | 458,679 | ||||||
Wuliangye Yibin Co., Ltd. Class A | 42,800 | 736,068 | ||||||
Yestar Healthcare Holdings Co., Ltd. (*) | 675,000 | 120,988 | ||||||
Zhuzhou CRRC Times Electric Co., Ltd., Class H | 92,900 | 489,687 | ||||||
ZTO Express Cayman, Inc. ADR | 45,726 | 874,281 | ||||||
25,335,943 | ||||||||
Colombia | 1.7% | ||||||||
Bancolombia SA Sponsored ADR | 33,592 | 1,714,536 | ||||||
Egypt | 1.2% | ||||||||
Commercial International Bank Egypt SAE GDR | 201,374 | 855,917 | ||||||
Credit Agricole Egypt SAE | 69,032 | 194,393 | ||||||
Dice Sport & Casual Wear (*) | 761,243 | 83,443 | ||||||
1,133,753 | ||||||||
Estonia | 0.1% | ||||||||
Tallinna Sadam AS | 35,959 | 79,744 | ||||||
Georgia | 0.6% | ||||||||
Bank of Georgia Group PLC | 19,609 | 373,311 | ||||||
TBC Bank Group PLC | 9,763 | 196,596 | ||||||
569,907 | ||||||||
Greece | 1.1% | ||||||||
JUMBO SA | 25,146 | 486,183 | ||||||
OPAP SA | 50,460 | 565,221 | ||||||
1,051,404 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 51
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Blend Portfolio (continued) | ||||||||
Hong Kong | 1.6% | ||||||||
China Water Affairs Group, Ltd. | 396,000 | $ | 390,001 | |||||
Kingboard Laminates Holdings, Ltd. | 314,000 | 288,457 | ||||||
NewOcean Energy Holdings, Ltd. (*) | 496,000 | 112,349 | ||||||
Techtronic Industries Co., Ltd. | 93,282 | 715,356 | ||||||
TK Group Holdings, Ltd. | 230,000 | 113,699 | ||||||
1,619,862 | ||||||||
Hungary | 1.0% | ||||||||
OTP Bank Nyrt. | 24,861 | 989,060 | ||||||
India | 11.2% | ||||||||
Axis Bank, Ltd. (*) | 191,918 | 2,253,576 | ||||||
Bajaj Auto, Ltd. | 21,669 | 887,880 | ||||||
Escorts, Ltd. | 36,718 | 285,356 | ||||||
Graphite India, Ltd. | 32,293 | 156,922 | ||||||
HCL Technologies, Ltd. | 33,517 | 517,022 | ||||||
ICICI Bank, Ltd. Sponsored ADR | 158,300 | 1,992,997 | ||||||
Infosys, Ltd. Sponsored ADR | 53,600 | 573,520 | ||||||
Jubilant Life Sciences, Ltd. | 37,656 | 279,460 | ||||||
Kiri Industries, Ltd. (*) | 29,310 | 217,062 | ||||||
Mahanagar Gas, Ltd. | 28,645 | 353,144 | ||||||
Petronet LNG, Ltd. | 76,241 | 271,038 | ||||||
Reliance Industries, Ltd. | 75,870 | 1,377,316 | ||||||
Tata Consultancy Services, Ltd. | 40,515 | 1,307,480 | ||||||
The South Indian Bank, Ltd. | 379,265 | 71,449 | ||||||
Uflex, Ltd. | 47,212 | 165,723 | ||||||
UPL, Ltd. | 28,092 | 381,601 | ||||||
11,091,546 | ||||||||
Indonesia | 4.6% | ||||||||
PT Bank Mandiri (Persero) Tbk | 2,430,800 | 1,382,417 | ||||||
PT Bank Pembangunan Daerah Jawa Timur Tbk | 2,167,300 | 97,416 | ||||||
PT Bank Rakyat Indonesia (Persero) Tbk | 5,716,890 | 1,764,885 | ||||||
PT Bekasi Fajar Industrial Estate Tbk | 9,411,600 | 203,710 | ||||||
PT Erajaya Swasembada Tbk | 968,200 | 131,488 | ||||||
PT Telekomunikasi Indonesia (Persero) Tbk Sponsored ADR | 33,530 | 980,417 | ||||||
4,560,333 |
The accompanying notes are an integral part of these financial statements.
52 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Blend Portfolio (continued) | ||||||||
Kenya | 0.2% | ||||||||
KCB Group, Ltd. | 442,400 | $ | 164,974 | |||||
Kuwait | 0.2% | ||||||||
Human Soft Holding Co. KSC | 22,392 | 233,211 | ||||||
Mexico | 3.0% | ||||||||
America Movil SAB de CV, Class L Sponsored ADR | 38,643 | 562,642 | ||||||
Credito Real SAB de CV | 101,900 | 124,974 | ||||||
Grupo Cementos de Chihuahua SAB de CV | 73,100 | 402,981 | ||||||
Grupo Financiero Banorte SAB de CV, Class O | 110,690 | 642,211 | ||||||
Grupo Mexico SAB de CV, Series B | 184,901 | 491,014 | ||||||
Kimberly-Clark de Mexico SAB de CV, Series A | 401,800 | 747,131 | ||||||
2,970,953 | ||||||||
Oman | 0.2% | ||||||||
Ooredoo | 160,160 | 192,178 | ||||||
Pakistan | 0.1% | ||||||||
Bank Alfalah, Ltd. | 433,000 | 118,154 | ||||||
Philippines | 1.3% | ||||||||
Bloomberry Resorts Corp. | 1,938,200 | 427,678 | ||||||
International Container Terminal Services, Inc. | 125,150 | 357,397 | ||||||
PLDT, Inc. Sponsored ADR | 19,082 | 473,615 | ||||||
1,258,690 | ||||||||
Russia | 7.0% | ||||||||
Gazprom PJSC Sponsored ADR | 116,048 | 850,230 | ||||||
LUKOIL PJSC Sponsored ADR | 12,273 | �� | 1,031,177 | |||||
Mobile TeleSystems PJSC Sponsored ADR | 104,200 | 970,102 | ||||||
Sberbank of Russia PJSC | 278,352 | 1,049,384 | ||||||
Sberbank of Russia PJSC Sponsored ADR | 106,047 | 1,620,398 | ||||||
Yandex NV Class A (*) | 36,900 | 1,402,200 | ||||||
6,923,491 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 53
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Blend Portfolio (continued) | ||||||||
Singapore | 0.4% | ||||||||
BOC Aviation, Ltd. | 49,200 | $ | 412,772 | |||||
South Africa | 1.1% | ||||||||
Standard Bank Group, Ltd. | 76,411 | 1,067,223 | ||||||
South Korea | 11.1% | ||||||||
ELP Corp. | 8,031 | 90,927 | ||||||
Eugene Technology Co., Ltd. | 31,361 | 311,165 | ||||||
Hanwha Life Insurance Co., Ltd. | 33,914 | 96,153 | ||||||
HS Industries Co., Ltd. | 56,560 | 457,545 | ||||||
Hyundai Mobis Co., Ltd. | 5,199 | 1,061,944 | ||||||
Innocean Worldwide, Inc. | 6,656 | 410,924 | ||||||
KT&G Corp. | 6,701 | 571,901 | ||||||
NCSoft Corp. | 2,394 | 988,869 | ||||||
Nice Information & Telecommunication, Inc. | 10,103 | 193,407 | ||||||
Samjin Pharmaceutical Co., Ltd. | 4,746 | 123,462 | ||||||
Samsung Electronics Co., Ltd. | 91,055 | 3,712,492 | ||||||
Shinhan Financial Group Co., Ltd. | 28,744 | 1,117,870 | ||||||
SK Hynix, Inc. | 30,830 | 1,857,173 | ||||||
10,993,832 | ||||||||
Taiwan | 7.0% | ||||||||
Bizlink Holding, Inc. | 47,000 | 326,428 | ||||||
Chailease Holding Co., Ltd. | 102,300 | 423,890 | ||||||
Hon Hai Precision Industry Co., Ltd. | 250,136 | 624,193 | ||||||
Largan Precision Co., Ltd. | 6,614 | 822,486 | ||||||
MediaTek, Inc. | 84,000 | 851,745 | ||||||
Powertech Technology, Inc. | 116,000 | 284,257 | ||||||
Primax Electronics, Ltd. | 98,000 | 171,167 | ||||||
Silicon Motion Technology Corp. ADR | 18,024 | 799,905 | ||||||
TaiDoc Technology Corp. | 87,000 | 400,980 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 212,720 | 1,622,741 | ||||||
Tripod Technology Corp. | 129,000 | 457,887 | ||||||
TSC Auto ID Technology Co., Ltd. | 13,000 | 117,075 | ||||||
6,902,754 |
The accompanying notes are an integral part of these financial statements.
54 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Blend Portfolio (concluded) | ||||||||
Thailand | 0.4% | ||||||||
Tisco Financial Group Public Co. Ltd. (‡) | 139,000 | $ | 423,787 | |||||
Turkey | 0.9% | ||||||||
KOC Holding AS ADR | 58,267 | 878,084 | ||||||
Ukraine | 0.2% | ||||||||
Kernel Holding SA | 15,235 | 197,081 | ||||||
United Arab Emirates | 1.4% | ||||||||
NMC Health PLC | 46,774 | 1,427,534 | ||||||
Total Common Stocks | ||||||||
(Cost $89,160,578) | 90,482,205 | |||||||
Preferred Stocks | 1.4% | ||||||||
Brazil | 1.4% | ||||||||
Banco Bradesco SA ADR (Cost $1,346,856) | 147,708 | 1,450,493 | ||||||
Short-Term Investments | 6.0% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $5,900,475) | 5,900,475 | 5,900,475 | ||||||
Total Investments | 99.0% (Cost $96,407,909) | $ | 97,833,173 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.0% | 939,451 | |||||||
Net Assets | 100.0% | $ | 98,772,624 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 55
The accompanying notes are an integral part of these financial statements.
56 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Portfolio (continued) | ||||||||
India | 10.7% | ||||||||
Axis Bank, Ltd. (*) | 10,039,422 | $ | 117,886,823 | |||||
Bajaj Auto, Ltd. | 1,740,863 | 71,331,279 | ||||||
Bharat Petroleum Corp., Ltd. | 11,113,459 | 63,068,622 | ||||||
Coal India, Ltd. | 18,516,769 | 68,164,003 | ||||||
HCL Technologies, Ltd. | 6,645,102 | 102,505,089 | ||||||
Hero MotoCorp, Ltd. | 2,609,820 | 97,602,410 | ||||||
Infosys, Ltd. Sponsored ADR | 8,075,252 | 86,405,196 | ||||||
Oil and Natural Gas Corp., Ltd. | 34,867,788 | 84,735,380 | ||||||
Tata Consultancy Services, Ltd. | 5,031,654 | 162,379,020 | ||||||
UPL, Ltd. | 3,023,025 | 41,064,681 | ||||||
895,142,503 | ||||||||
Indonesia | 5.6% | ||||||||
PT Astra International Tbk | 204,274,200 | 107,756,057 | ||||||
PT Bank Mandiri (Persero) Tbk | 305,812,742 | 173,918,307 | ||||||
PT Semen Indonesia (Persero) Tbk | 58,031,300 | 47,596,266 | ||||||
PT Telekomunikasi Indonesia (Persero) Tbk Sponsored ADR | 4,794,610 | 140,194,396 | ||||||
469,465,026 | ||||||||
Luxembourg | 0.8% | ||||||||
Ternium SA Sponsored ADR | 2,792,867 | 62,644,007 | ||||||
Malaysia | 0.6% | ||||||||
British American Tobacco Malaysia Berhad | 7,433,600 | 51,814,813 | ||||||
Mexico | 3.3% | ||||||||
America Movil SAB de CV, Class L Sponsored ADR | 10,030,771 | 146,048,026 | ||||||
Grupo Mexico SAB de CV, Series B | 22,239,947 | 59,059,334 | ||||||
Kimberly-Clark de Mexico SAB de CV, Series A | 38,523,995 | 71,633,807 | ||||||
276,741,167 | ||||||||
Pakistan | 0.8% | ||||||||
Habib Bank, Ltd. | 20,889,280 | 14,809,799 | ||||||
Oil & Gas Development Co., Ltd. | 6,864,417 | 5,650,053 | ||||||
Pakistan Petroleum, Ltd. | 51,465,552 | 46,555,512 | ||||||
67,015,364 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 57
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Portfolio (continued) | ||||||||
Philippines | 0.8% | ||||||||
PLDT, Inc. Sponsored ADR | 2,727,481 | $ | 67,696,078 | |||||
Russia | 9.7% | ||||||||
ALROSA PAO (*) | 74,529,068 | 101,522,975 | ||||||
Gazprom PJSC Sponsored ADR | 18,607,913 | 136,331,507 | ||||||
LUKOIL PJSC Sponsored ADR | 1,510,078 | 127,487,668 | ||||||
Magnit PJSC Sponsored GDR | 4,276,740 | 62,329,431 | ||||||
Mobile TeleSystems PJSC Sponsored ADR | 13,419,643 | 124,936,876 | ||||||
Sberbank of Russia PJSC | 68,155,115 | 256,944,102 | ||||||
809,552,559 | ||||||||
South Africa | 7.3% | ||||||||
Imperial Logistics, Ltd. | 2,010,083 | 7,342,755 | ||||||
Life Healthcare Group Holdings, Ltd. | 31,307,531 | 49,914,378 | ||||||
Motus Holdings, Ltd. | 5,811,313 | 30,192,867 | ||||||
Nedbank Group, Ltd. | 4,103,080 | 73,861,391 | ||||||
PPC, Ltd. (*) | 42,770,239 | 14,029,003 | ||||||
Sanlam, Ltd. | 13,570,458 | 75,403,144 | ||||||
Shoprite Holdings, Ltd. | 8,493,059 | 95,087,225 | ||||||
Standard Bank Group, Ltd. | 6,097,180 | 85,158,577 | ||||||
The Bidvest Group, Ltd. | 5,189,072 | 69,773,453 | ||||||
Vodacom Group, Ltd. | 9,400,110 | 79,880,353 | ||||||
Woolworths Holdings, Ltd. | 8,556,220 | 29,712,897 | ||||||
610,356,043 | ||||||||
South Korea | 14.2% | ||||||||
Hanwha Life Insurance Co., Ltd. | 7,283,970 | 20,651,595 | ||||||
Hyundai Mobis Co., Ltd. | 580,941 | 118,662,636 | ||||||
KB Financial Group, Inc. | 3,215,107 | 127,394,077 | ||||||
KT&G Corp. | 898,130 | 76,651,466 | ||||||
Samsung Electronics Co., Ltd. | 9,183,122 | 374,414,029 | ||||||
Shinhan Financial Group Co., Ltd. | 3,918,107 | 152,377,371 | ||||||
SK Hynix, Inc. | 3,765,959 | 226,858,101 | ||||||
Woongjin Coway Co., Ltd. | 1,275,820 | 85,543,121 | ||||||
1,182,552,396 |
The accompanying notes are an integral part of these financial statements.
58 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Emerging Markets Equity Portfolio (concluded) | ||||||||
Taiwan | 4.7% | ||||||||
Catcher Technology Co., Ltd. | 11,425,000 | $ | 81,973,341 | |||||
Hon Hai Precision Industry Co., Ltd. | 39,045,425 | 97,434,545 | ||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 27,446,284 | 209,374,853 | ||||||
388,782,739 | ||||||||
Thailand | 1.8% | ||||||||
Kasikornbank Public Co. Ltd. | 13,244,054 | 81,837,393 | ||||||
The Siam Cement Public Co. Ltd. (‡) | 4,638,600 | 71,392,164 | ||||||
153,229,557 | ||||||||
Turkey | 2.2% | ||||||||
KOC Holding AS | 26,487,848 | 80,255,183 | ||||||
Tupras Turkiye Petrol Rafinerileri AS | 5,142,041 | 102,137,563 | ||||||
182,392,746 | ||||||||
Total Common Stocks (Cost $7,576,637,449) | 8,022,670,228 | |||||||
Short-Term Investments | 3.7% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $308,295,968) | 308,295,968 | 308,295,968 | ||||||
Total Investments | 99.8% (Cost $7,884,933,417) | $ | 8,330,966,196 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.2% | 18,648,570 | |||||||
Net Assets | 100.0% | $ | 8,349,614,766 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 59
The accompanying notes are an integral part of these financial statements.
60 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Equity Franchise Portfolio (concluded) | ||||||||
MEDNAX, Inc. N Ap (*) | 74,082 | $ | 1,869,089 | |||||
Medtronic PLC | 12,857 | 1,252,143 | ||||||
Nielsen Holdings PLC | 93,758 | 2,118,931 | ||||||
Omnicom Group, Inc. | 21,037 | 1,723,982 | ||||||
Oracle Corp. | 27,243 | 1,552,034 | ||||||
Stericycle, Inc. (*) | 44,957 | 2,146,697 | ||||||
Tapestry, Inc. | 52,184 | 1,655,798 | ||||||
23,713,278 | ||||||||
Total Common Stocks (Cost $36,857,841) | 35,986,772 | |||||||
Short-Term Investments | 2.7% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $1,000,857) | 1,000,857 | 1,000,857 | ||||||
Total Investments | 99.7% (Cost $37,858,698) | $ | 36,987,629 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.3% | 95,135 | |||||||
Net Assets | 100.0% | $ | 37,082,764 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 61
The accompanying notes are an integral part of these financial statements.
62 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Equity Select Portfolio (continued) | ||||||||
Japan | 5.2% | ||||||||
Daiwa House Industry Co., Ltd. | 24,073 | $ | 703,033 | |||||
Kansai Paint Co., Ltd. | 27,067 | 569,135 | ||||||
Kao Corp. | 10,553 | 805,090 | ||||||
TechnoPro Holdings, Inc. | 14,724 | 784,700 | ||||||
Yamaha Corp. | 17,764 | 845,806 | ||||||
3,707,764 | ||||||||
Netherlands | 2.6% | ||||||||
Wolters Kluwer NV | 26,031 | 1,895,123 | ||||||
Singapore | 1.4% | ||||||||
Oversea-Chinese Banking Corp., Ltd. | 121,624 | 1,028,323 | ||||||
South Africa | 1.5% | ||||||||
Distell Group Holdings, Ltd. | 68,207 | 628,324 | ||||||
Sanlam, Ltd. | 80,008 | 444,558 | ||||||
1,072,882 | ||||||||
South Korea | 0.4% | ||||||||
Fila Korea, Ltd. | 3,900 | 259,475 | ||||||
Sweden | 3.1% | ||||||||
Assa Abloy AB, Class B | 26,173 | 592,519 | ||||||
Epiroc AB, Class A | 79,330 | 826,012 | ||||||
Hexagon AB, B Shares | 13,902 | 771,979 | ||||||
2,190,510 | ||||||||
Switzerland | 3.2% | ||||||||
Alcon, Inc. (*) | 8,295 | 513,031 | ||||||
Novartis AG | 11,131 | 1,018,119 | ||||||
Partners Group Holding AG | 951 | 747,264 | ||||||
2,278,414 | ||||||||
Taiwan | 1.0% | ||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR | 17,616 | 690,019 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 63
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Equity Select Portfolio (continued) | ||||||||
United Kingdom | 12.3% | ||||||||
Bunzl PLC | 18,301 | $ | 483,546 | |||||
Coca-Cola European Partners PLC | 19,374 | 1,094,631 | ||||||
Compass Group PLC | 36,972 | 886,042 | ||||||
Diageo PLC | 38,225 | 1,646,131 | ||||||
Prudential PLC | 33,650 | 732,920 | ||||||
RELX PLC | 56,459 | 1,366,288 | ||||||
RSA Insurance Group PLC | 80,889 | 593,940 | ||||||
The Weir Group PLC | 21,962 | 431,413 | ||||||
Unilever PLC | 24,837 | 1,542,325 | ||||||
8,777,236 | ||||||||
United States | 46.9% | ||||||||
Accenture PLC, Class A | 7,541 | 1,393,351 | ||||||
Alphabet, Inc., Class A (*) | 1,723 | 1,865,664 | ||||||
Aon PLC | 9,214 | 1,778,118 | ||||||
Boston Scientific Corp. (*) | 26,013 | 1,118,039 | ||||||
Cisco Systems, Inc. | 18,462 | 1,010,425 | ||||||
Comerica, Inc. | 8,410 | 610,902 | ||||||
CoreLogic, Inc. (*) | 13,904 | 581,604 | ||||||
Dollar General Corp. | 5,732 | 774,737 | ||||||
Eaton Corp. PLC | 7,149 | 595,369 | ||||||
eBay, Inc. | 15,992 | 631,684 | ||||||
Honeywell International, Inc. | 8,175 | 1,427,273 | ||||||
Intercontinental Exchange, Inc. | 15,662 | 1,345,992 | ||||||
IQVIA Holdings, Inc. (*) | 11,798 | 1,898,298 | ||||||
Johnson & Johnson | 12,562 | 1,749,635 | ||||||
Lowe’s Cos., Inc. | 3,623 | 365,597 | ||||||
McDonald’s Corp. | 5,847 | 1,214,188 | ||||||
Microsoft Corp. | 16,083 | 2,154,479 | ||||||
Motorola Solutions, Inc. | 8,074 | 1,346,178 | ||||||
Rockwell Automation, Inc. | 6,828 | 1,118,631 | ||||||
S&P Global, Inc. | 5,302 | 1,207,743 | ||||||
Schlumberger, Ltd. | 13,716 | 545,074 | ||||||
Texas Instruments, Inc. | 6,036 | 692,691 | ||||||
The Coca-Cola Co. | 33,877 | 1,725,017 | ||||||
The Procter & Gamble Co. | 9,830 | 1,077,860 |
The accompanying notes are an integral part of these financial statements.
64 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Equity Select Portfolio (concluded) | ||||||||
Thermo Fisher Scientific, Inc. | 6,936 | $ | 2,036,965 | |||||
Visa, Inc., Class A | 9,255 | 1,606,205 | ||||||
Zoetis, Inc. | 15,145 | 1,718,806 | ||||||
33,590,525 | ||||||||
Total Common Stocks (Cost $56,280,509) | 68,289,327 | |||||||
Short-Term Investments | 5.2% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $3,690,630) | 3,690,630 | 3,690,630 | ||||||
Total Investments | 100.6% (Cost $59,971,139) | $ | 71,979,957 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.6)% | (443,935 | ) | ||||||
Net Assets | 100.0% | $ | 71,536,022 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 65
The accompanying notes are an integral part of these financial statements.
66 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Listed Infrastructure Portfolio (continued) | ||||||||
United Kingdom | 19.4% | ||||||||
National Grid PLC | 51,440,282 | $ | 546,664,337 | |||||
Pennon Group PLC | 17,857,009 | 168,460,394 | ||||||
Severn Trent PLC | 11,264,200 | 293,112,699 | ||||||
United Utilities Group PLC | 29,685,560 | 295,361,017 | ||||||
1,303,598,447 | ||||||||
United States | 21.2% | ||||||||
American Electric Power Co., Inc. | 1,529,107 | 134,576,707 | ||||||
Consolidated Edison, Inc. | 1,510,761 | 132,463,525 | ||||||
CSX Corp. | 1,797,811 | 139,096,637 | ||||||
Kansas City Southern | 2,522,203 | 307,254,769 | ||||||
Norfolk Southern Corp. | 2,549,508 | 508,193,430 | ||||||
Union Pacific Corp. | 1,226,036 | 207,334,948 | ||||||
1,428,920,016 | ||||||||
Total Common Stocks (Cost $5,812,578,559) | 6,208,087,755 | |||||||
Short-Term Investments | 7.8% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $522,234,791) | 522,234,791 | 522,234,791 | ||||||
Total Investments | 100.0% | ||||||||
(Cost $6,334,813,350) (») | $ | 6,730,322,546 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.0% | 424,853 | |||||||
Net Assets | 100.0% | $ | 6,730,747,399 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 67
Lazard Global Listed Infrastructure Portfolio (concluded)
Forward Currency Contracts open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | ||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Depreciation | |||||||||||||
USD | 118,245,719 | AUD | 170,632,682 | BNP | 09/26/19 | $ | 1,851,081 | ||||||||||||
USD | 71,446,191 | AUD | 103,062,752 | CIT | 09/26/19 | 1,092,706 | |||||||||||||
USD | 97,468,296 | AUD | 140,610,369 | HSB | 09/26/19 | 1,497,829 | |||||||||||||
USD | 102,728,335 | AUD | 148,172,136 | RBC | 09/26/19 | 1,560,006 | |||||||||||||
USD | 103,489,308 | AUD | 149,333,066 | SCB | 09/26/19 | 1,616,133 | |||||||||||||
USD | 84,655,823 | AUD | 122,165,527 | SSB | 09/26/19 | 1,328,225 | |||||||||||||
USD | 22,236,415 | CAD | 29,336,480 | BNP | 09/26/19 | 199,912 | |||||||||||||
USD | 19,476,152 | CAD | 25,694,498 | HSB | 09/26/19 | 174,813 | |||||||||||||
USD | 24,911,488 | CAD | 32,863,608 | SCB | 09/26/19 | 222,361 | |||||||||||||
USD | 329,814,794 | EUR | 288,218,521 | BNP | 09/26/19 | 121,060 | |||||||||||||
USD | 343,146,441 | EUR | 299,974,160 | CAN | 09/26/19 | 246,588 | |||||||||||||
USD | 342,768,595 | EUR | 299,603,256 | CIT | 09/26/19 | 199,844 | |||||||||||||
USD | 410,994,353 | EUR | 359,204,280 | HSB | 09/26/19 | 201,883 | |||||||||||||
USD | 416,395,541 | EUR | 363,977,344 | MEL | 09/26/19 | 264,622 | |||||||||||||
USD | 385,797,288 | EUR | 337,195,600 | RBC | 09/26/19 | 204,688 | |||||||||||||
USD | 380,141,689 | EUR | 332,259,738 | SSB | 09/26/19 | 209,998 | |||||||||||||
USD | 210,478,914 | GBP | 165,130,587 | BNP | 09/26/19 | 22,453 | |||||||||||||
USD | 170,585,381 | GBP | 133,833,393 | CAN | 09/26/19 | 19,670 | |||||||||||||
USD | 215,518,378 | GBP | 169,123,160 | CIT | 09/26/19 | 72,549 | |||||||||||||
USD | 237,408,916 | GBP | 186,271,737 | HSB | 09/26/19 | 42,279 | |||||||||||||
USD | 212,974,096 | GBP | 167,077,164 | RBC | 09/26/19 | 8,683 | |||||||||||||
USD | 263,653,861 | GBP | 206,908,079 | SSB | 09/26/19 | 103,655 | |||||||||||||
USD | 28,621,765 | HKD | 223,521,244 | BNP | 09/26/19 | 2,615 | |||||||||||||
USD | 109,453,750 | HKD | 854,877,566 | HSB | 09/26/19 | 22,824 | |||||||||||||
USD | 102,003,417 | HKD | 796,737,469 | SSB | 09/26/19 | 27,671 | |||||||||||||
Total gross unrealized depreciation on Forward Currency Contracts | $ | 11,314,148 |
The accompanying notes are an integral part of these financial statements.
68 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 69
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Strategic Equity Portfolio (continued) | ||||||||
Israel | 1.5% | ||||||||
Bank Leumi Le-Israel BM | 6,417 | $ | 46,368 | |||||
Japan | 4.7% | ||||||||
Digital Garage, Inc. | 900 | 28,633 | ||||||
Nexon Co., Ltd. (*) | 2,200 | 31,939 | ||||||
Suzuki Motor Corp. | 600 | 28,241 | ||||||
TechnoPro Holdings, Inc. | 500 | 26,647 | ||||||
Toei Animation Co., Ltd. | 600 | 27,880 | ||||||
143,340 | ||||||||
Netherlands | 1.5% | ||||||||
Koninklijke DSM NV | 382 | 47,232 | ||||||
New Zealand | 1.1% | ||||||||
Mainfreight, Ltd. | 1,211 | 33,153 | ||||||
South Africa | 2.4% | ||||||||
Naspers, Ltd., N Shares | 201 | 48,830 | ||||||
Sanlam, Ltd. | 4,412 | 24,515 | ||||||
73,345 | ||||||||
Switzerland | 5.2% | ||||||||
Alcon, Inc. (*) | 392 | 24,245 | ||||||
Novartis AG | 592 | 54,148 | ||||||
Partners Group Holding AG | 66 | 51,861 | ||||||
The Swatch Group AG | 107 | 30,721 | ||||||
160,975 | ||||||||
United Kingdom | 7.3% | ||||||||
Coca-Cola European Partners PLC | 927 | 51,608 | ||||||
Informa PLC | 4,338 | 46,054 | ||||||
Prudential PLC | 1,559 | 33,956 | ||||||
RELX PLC | 2,561 | 61,975 | ||||||
Rio Tinto PLC | 506 | 31,218 | ||||||
224,811 |
The accompanying notes are an integral part of these financial statements.
70 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Strategic Equity Portfolio (continued) | ||||||||
United States | 50.7% | ||||||||
Accenture PLC, Class A | 321 | $ | 59,311 | |||||
Alphabet, Inc., Class A (*) | 124 | 134,267 | ||||||
Aon PLC | 419 | 80,859 | ||||||
Bank of America Corp. | 1,855 | 53,795 | ||||||
Baxter International, Inc. | 580 | 47,502 | ||||||
CoreLogic, Inc. (*) | 1,076 | 45,009 | ||||||
Danaher Corp. | 400 | 57,168 | ||||||
Deere & Co. | 184 | 30,491 | ||||||
Dollar General Corp. | 324 | 43,792 | ||||||
Elanco Animal Health, Inc. | 1,390 | 46,982 | ||||||
Electronic Arts, Inc. (*) | 250 | 25,315 | ||||||
EOG Resources, Inc. | 265 | 24,687 | ||||||
Halliburton Co. | 1,167 | 26,538 | ||||||
Henry Schein, Inc. (*) | 446 | 31,175 | ||||||
Intercontinental Exchange, Inc. | 1,141 | 98,057 | ||||||
IPG Photonics Corp. (*) | 159 | 24,526 | ||||||
IQVIA Holdings, Inc. (*) | 585 | 94,126 | ||||||
Medtronic PLC | 584 | 56,876 | ||||||
Microsoft Corp. | 808 | 108,240 | ||||||
Palo Alto Networks, Inc. (*) | 176 | 35,862 | ||||||
Raytheon Co. | 295 | 51,295 | ||||||
S&P Global, Inc. | 317 | 72,209 | ||||||
The Coca-Cola Co. | 1,540 | 78,417 | ||||||
Union Pacific Corp. | 178 | 30,101 | ||||||
Visa, Inc., Class A | 604 | 104,824 | ||||||
Worldpay, Inc., Class A (*) | 292 | 35,785 | ||||||
Zoetis, Inc. | 551 | 62,533 | ||||||
1,559,742 | ||||||||
Total Common Stocks (Cost $2,472,840) | 2,945,338 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 71
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Strategic Equity Portfolio (concluded) | ||||||||
Short-Term Investments | 4.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $136,026) | 136,026 | $ | 136,026 | |||||
Total Investments | 100.1% | ||||||||
(Cost $2,608,866) | $ | 3,081,364 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.1)% | (4,119 | ) | ||||||
Net Assets | 100.0% | $ | 3,077,245 |
The accompanying notes are an integral part of these financial statements.
72 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 73
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Quality Growth Portfolio (continued) | ||||||||
Japan | 7.9% | ||||||||
Pigeon Corp. | 1,600 | $ | 64,542 | |||||
Shimano, Inc. | 300 | 44,576 | ||||||
SMS Co., Ltd. | 4,200 | 99,222 | ||||||
Toei Animation Co., Ltd. | 1,700 | 78,992 | ||||||
287,332 | ||||||||
Netherlands | 4.0% | ||||||||
ASML Holding NV | 350 | 73,173 | ||||||
Wolters Kluwer NV | 1,008 | 73,385 | ||||||
146,558 | ||||||||
Norway | 2.0% | ||||||||
Gjensidige Forsikring ASA | 3,513 | 70,743 | ||||||
Philippines | 0.9% | ||||||||
Universal Robina Corp. | 10,390 | 33,706 | ||||||
South Africa | 4.5% | ||||||||
Clicks Group, Ltd. | 6,011 | 87,629 | ||||||
Mr Price Group, Ltd. | 2,133 | 30,063 | ||||||
Sanlam, Ltd. | 7,839 | 43,557 | ||||||
161,249 | ||||||||
Spain | 1.5% | ||||||||
Industria de Diseno Textil SA | 1,848 | 55,524 | ||||||
Sweden | 6.1% | ||||||||
Assa Abloy AB, Class B | 4,712 | 106,673 | ||||||
Avanza Bank Holding AB | 5,580 | 42,620 | ||||||
Hexagon AB, B Shares | 1,288 | 71,522 | ||||||
220,815 | ||||||||
Switzerland | 8.2% | ||||||||
Alcon, Inc. (*) | 1,242 | 76,816 | ||||||
Cie Financiere Richemont SA | 537 | 45,577 | ||||||
Geberit AG | 148 | 69,141 | ||||||
Partners Group Holding AG | 134 | 105,293 | ||||||
296,827 |
The accompanying notes are an integral part of these financial statements.
74 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Quality Growth Portfolio (concluded) | ||||||||
Taiwan | 2.5% | ||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR | 2,269 | $ | 88,877 | |||||
United Kingdom | 13.0% | ||||||||
Bunzl PLC | 2,394 | 63,254 | ||||||
Compass Group PLC | 3,323 | 79,636 | ||||||
Dechra Pharmaceuticals PLC | 1,199 | 41,815 | ||||||
Intertek Group PLC | 1,084 | 75,942 | ||||||
London Stock Exchange Group PLC | 1,057 | 73,645 | ||||||
Prudential PLC | 2,126 | 46,306 | ||||||
RELX PLC | 3,796 | 91,862 | ||||||
472,460 | ||||||||
United States | 5.4% | ||||||||
Aon PLC | 639 | 123,314 | ||||||
QIAGEN NV (*) | 1,746 | 70,930 | ||||||
194,244 | ||||||||
Total Common Stocks | ||||||||
(Cost $2,922,661) | 3,500,140 | |||||||
Short-Term Investments | 3.8% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $136,134) | 136,134 | 136,134 | ||||||
Total Investments | 100.4% | ||||||||
(Cost $3,058,795) | $ | 3,636,274 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.4)% | (13,951 | ) | ||||||
Net Assets | 100.0% | $ | 3,622,323 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 75
The accompanying notes are an integral part of these financial statements.
76 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (continued) | ||||||||
Denmark | 2.3% | ||||||||
Coloplast A/S, Class B | 63 | $ | 7,135 | |||||
H. Lundbeck A/S | 58 | 2,294 | ||||||
Novo Nordisk A/S, Class B | 633 | 32,289 | ||||||
SimCorp A/S | 139 | 13,443 | ||||||
55,161 | ||||||||
Finland | 0.1% | ||||||||
Fortum Oyj | 74 | 1,635 | ||||||
France | 10.7% | ||||||||
Air France-KLM (*) | 243 | 2,336 | ||||||
AXA SA | 292 | 7,671 | ||||||
BNP Paribas SA | 203 | 9,658 | ||||||
Christian Dior SE | 24 | 12,582 | ||||||
Electricite de France SA | 1,828 | 23,055 | ||||||
Engie SA | 288 | 4,374 | ||||||
Faurecia SA | 261 | 12,115 | ||||||
Hermes International | 26 | 18,752 | ||||||
Ipsen SA | 128 | 17,467 | ||||||
Kering SA | 29 | 17,155 | ||||||
L’Oreal SA | 85 | 24,212 | ||||||
Orange SA | 349 | 5,502 | ||||||
Peugeot SA | 1,402 | 34,553 | ||||||
Schneider Electric SE | 56 | 5,080 | ||||||
Total SA | 1,112 | 62,218 | ||||||
256,730 | ||||||||
Germany | 9.1% | ||||||||
Adidas AG | 57 | 17,597 | ||||||
Allianz SE | 247 | 59,531 | ||||||
Continental AG | 77 | 11,226 | ||||||
Covestro AG | 316 | 16,063 | ||||||
CTS Eventim AG & Co. KGaA | 117 | 5,445 | ||||||
Deutsche Lufthansa AG | 525 | 8,996 | ||||||
Deutsche Telekom AG | 450 | 7,788 | ||||||
Infineon Technologies AG | 991 | 17,513 | ||||||
MTU Aero Engines AG | 146 | 34,833 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 77
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (continued) | ||||||||
Rheinmetall AG | 90 | $ | 11,017 | |||||
SAP SE | 177 | 24,331 | ||||||
Schaeffler AG (Preference Shares) | 409 | 3,043 | ||||||
217,383 | ||||||||
Hong Kong | 4.0% | ||||||||
CK Asset Holdings, Ltd. | 2,000 | 15,613 | ||||||
CK Hutchison Holdings, Ltd. | 1,000 | 9,839 | ||||||
Jardine Matheson Holdings, Ltd. | 1 | 63 | ||||||
Kerry Properties, Ltd. | 1,500 | 6,303 | ||||||
Link Real Estate Investment Trust | 500 | 6,150 | ||||||
Sands China, Ltd. | 4,400 | 21,092 | ||||||
Swire Pacific, Ltd., Class A | 2,000 | 24,608 | ||||||
WH Group, Ltd. | 12,000 | 12,216 | ||||||
95,884 | ||||||||
Ireland | 0.2% | ||||||||
Experian PLC | 154 | 4,675 | ||||||
Israel | 0.3% | ||||||||
CyberArk Software, Ltd. (*) | 17 | 2,173 | ||||||
Israel Discount Bank, Ltd., Class A | 1,047 | 4,281 | ||||||
6,454 | ||||||||
Italy | 3.2% | ||||||||
Enel SpA | 7,941 | 55,486 | ||||||
Poste Italiane SpA | 519 | 5,467 | ||||||
UniCredit SpA | 1,261 | 15,523 | ||||||
76,476 | ||||||||
Japan | 22.8% | ||||||||
Advantest Corp. | 300 | 8,300 | ||||||
AGC, Inc. | 300 | 10,396 | ||||||
Canon, Inc. | 100 | 2,929 | ||||||
Daicel Corp. | 1,400 | 12,476 | ||||||
Daiwa House Industry Co., Ltd. | 1,500 | 43,806 | ||||||
Dip Corp. | 100 | 1,678 | ||||||
DMG Mori Co., Ltd. | 300 | 4,827 | ||||||
East Japan Railway Co. ADR | 2,054 | 31,899 | ||||||
FUJIFILM Holdings Corp. | 200 | 10,161 |
The accompanying notes are an integral part of these financial statements.
78 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (continued) | ||||||||
Fukuoka Financial Group, Inc. | 500 | $ | 9,190 | |||||
FULLCAST Holdings Co., Ltd. | 100 | 2,134 | ||||||
Hitachi Capital Corp. (*) | 100 | 2,232 | ||||||
Hitachi, Ltd. | 400 | 14,701 | ||||||
Honda Motor Co., Ltd. | 400 | 10,361 | ||||||
Hoya Corp. | 100 | 7,681 | ||||||
IHI Corp. | 100 | 2,418 | ||||||
Japan Post Holdings Co., Ltd. | 3,200 | 36,256 | ||||||
Japan Tobacco, Inc. | 700 | 15,469 | ||||||
JFE Holdings, Inc. | 500 | 7,361 | ||||||
Maeda Corp. | 200 | 1,603 | ||||||
Mitsubishi Heavy Industries, Ltd. | 600 | 26,155 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 3,700 | 17,688 | ||||||
Nikkiso Co., Ltd. | 200 | 2,671 | ||||||
Nitto Denko Corp. | 100 | 4,925 | ||||||
NTT DOCOMO, Inc. | 2,100 | 49,011 | ||||||
ORIX Corp. | 1,900 | 28,402 | ||||||
Raysum Co., Ltd. | 200 | 1,852 | ||||||
Seven & I Holdings Co., Ltd. | 500 | 16,948 | ||||||
Shin-Etsu Chemical Co., Ltd. | 100 | 9,337 | ||||||
Shionogi & Co., Ltd. | 100 | 5,774 | ||||||
Showa Denko KK | 200 | 5,931 | ||||||
SoftBank Group Corp. | 200 | 9,638 | ||||||
Sompo Holdings, Inc. | 500 | 19,351 | ||||||
Sony Corp. | 100 | 5,225 | ||||||
Sumitomo Heavy Industries, Ltd. | 400 | 13,799 | ||||||
Sumitomo Mitsui Construction Co., Ltd. | 900 | 4,995 | ||||||
Sumitomo Mitsui Trust Holdings, Inc. | 400 | 14,530 | ||||||
Suzuken Co., Ltd. | 300 | 17,633 | ||||||
Taisei Corp. | 200 | 7,279 | ||||||
The Dai-ichi Life Insurance Co., Ltd. | 1,100 | 16,642 | ||||||
Tokyo Electron, Ltd. | 100 | 14,061 | ||||||
Toyo Seikan Group Holdings, Ltd. | 300 | 5,967 | ||||||
UT Group Co., Ltd. | 200 | 4,878 | ||||||
West Japan Railway Co. | 100 | 8,112 | ||||||
546,682 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 79
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (continued) | ||||||||
Luxembourg | 0.1% | ||||||||
ArcelorMittal | 130 | $ | 2,328 | |||||
Macau | 0.1% | ||||||||
Wynn Macau, Ltd. | 1,200 | 2,696 | ||||||
Netherlands | 5.9% | ||||||||
Euronext NV | 136 | 10,292 | ||||||
EXOR NV | 71 | 4,962 | ||||||
ING Groep NV | 1,942 | 22,519 | ||||||
Koninklijke Ahold Delhaize NV | 834 | 18,757 | ||||||
Royal Dutch Shell PLC, A Shares | 1,752 | 57,369 | ||||||
Wolters Kluwer NV | 374 | 27,228 | ||||||
141,127 | ||||||||
Norway | 2.4% | ||||||||
Aker BP ASA | 271 | 7,814 | ||||||
Equinor ASA | 1,476 | 29,242 | ||||||
Salmar ASA | 96 | 4,175 | ||||||
Telenor ASA | 708 | 15,046 | ||||||
56,277 | ||||||||
Singapore | 0.2% | ||||||||
DBS Group Holdings, Ltd. | 300 | 5,759 | ||||||
Spain | 2.9% | ||||||||
Amadeus IT Group SA | 332 | 26,273 | ||||||
Banco Bilbao Vizcaya Argentaria SA | 3,069 | 17,163 | ||||||
Iberdrola SA | 920 | 9,177 | ||||||
Industria de Diseno Textil SA | 600 | 18,027 | ||||||
70,640 | ||||||||
Sweden | 2.0% | ||||||||
Atlas Copco AB, Class A | 607 | 19,404 | ||||||
Evolution Gaming Group AB | 241 | 4,771 | ||||||
Granges AB | 171 | 1,959 | ||||||
Nordic Entertainment Group AB, Class B | 113 | 2,657 | ||||||
SKF AB, Class B | 154 | 2,832 | ||||||
Volvo AB, Class B | 1,068 | 16,949 | ||||||
48,572 |
The accompanying notes are an integral part of these financial statements.
80 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (continued) | ||||||||
Switzerland | 9.8% | ||||||||
Alcon, Inc. (*) | 70 | $ | 4,329 | |||||
Nestle SA | 370 | 38,306 | ||||||
Novartis AG | 857 | 78,387 | ||||||
Partners Group Holding AG | 22 | 17,287 | ||||||
Roche Holding AG | 305 | 85,817 | ||||||
Sika AG | 29 | 4,950 | ||||||
STMicroelectronics NV | 186 | 3,300 | ||||||
The Swatch Group AG | 44 | 2,382 | ||||||
234,758 | ||||||||
United Kingdom | 13.1% | ||||||||
Anglo American PLC | 466 | 13,329 | ||||||
Associated British Foods PLC | 642 | 20,123 | ||||||
Auto Trader Group PLC | 1,394 | 9,715 | ||||||
Britvic PLC | 742 | 8,379 | ||||||
Burberry Group PLC | 250 | 5,931 | ||||||
Cineworld Group PLC | 983 | 3,172 | ||||||
Compass Group PLC | 201 | 4,817 | ||||||
Dunelm Group PLC | 576 | 6,730 | ||||||
Fiat Chrysler Automobiles NV | 470 | 6,540 | ||||||
Games Workshop Group PLC | 82 | 5,172 | ||||||
Grafton Group PLC | 229 | 2,352 | ||||||
Howden Joinery Group PLC | 1,843 | 11,867 | ||||||
Imperial Brands PLC | 1,352 | 31,745 | ||||||
International Consolidated Airlines Group SA | 2,423 | 14,672 | ||||||
KAZ Minerals PLC | 407 | 3,133 | ||||||
Lloyds Banking Group PLC | 34,378 | 24,757 | ||||||
Prudential PLC | 225 | 4,901 | ||||||
RELX PLC | 194 | 4,715 | ||||||
Rightmove PLC | 668 | 4,539 | ||||||
Rio Tinto PLC | 381 | 23,506 | ||||||
Royal Bank of Scotland Group PLC | 9,556 | 26,679 | ||||||
Tate & Lyle PLC | 2,083 | 19,533 | ||||||
Unilever NV | 894 | 54,457 | ||||||
WH Smith PLC | 126 | 3,153 | ||||||
313,917 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 81
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Advantage Portfolio (concluded) | ||||||||
Total Common Stocks (Cost $2,327,330) | $ | 2,341,016 | ||||||
Short-Term Investments | 2.6% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $61,584) | 61,584 | 61,584 | ||||||
Total Investments | 100.3% | ||||||||
(Cost $2,388,914) | $ | 2,402,600 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.3)% | (6,222 | ) | ||||||
Net Assets | 100.0% | $ | 2,396,378 |
The accompanying notes are an integral part of these financial statements.
82 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 83
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Concentrated Portfolio (continued) | ||||||||
Mexico | 5.3% | ||||||||
Arca Continental SAB de CV | 482,800 | $ | 2,612,245 | |||||
Grupo Financiero Banorte SAB de CV, Class O | 356,600 | 2,068,954 | ||||||
4,681,199 | ||||||||
Netherlands | 2.6% | ||||||||
ABN AMRO Group NV | 105,120 | 2,249,320 | ||||||
South Korea | 3.5% | ||||||||
Samsung Electronics Co., Ltd. | 76,002 | 3,098,752 | ||||||
United Kingdom | 10.5% | ||||||||
BP PLC | 435,502 | 3,043,471 | ||||||
Compass Group PLC | 126,540 | 3,032,558 | ||||||
Prudential PLC | 142,213 | 3,097,495 | ||||||
9,173,524 | ||||||||
United States | 9.2% | ||||||||
Aon PLC | 17,865 | 3,447,587 | ||||||
Medtronic PLC | 47,007 | 4,578,012 | ||||||
8,025,599 | ||||||||
Total Common Stocks (Cost $76,699,422) | 80,043,146 | |||||||
Preferred Stocks | 3.5% | ||||||||
Germany | 3.5% | ||||||||
Volkswagen AG (Cost $3,184,471) | 18,202 | 3,067,492 |
The accompanying notes are an integral part of these financial statements.
84 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Concentrated Portfolio (concluded) | ||||||||
Short-Term Investments | 4.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $3,832,671) | 3,832,671 | $ | 3,832,671 | |||||
Total Investments | 99.3% (Cost $83,716,564) | $ | 86,943,309 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.7% | 601,617 | |||||||
Net Assets | 100.0% | $ | 87,544,926 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 85
The accompanying notes are an integral part of these financial statements.
86 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Portfolio (continued) | ||||||||
Germany | 5.0% | ||||||||
Fresenius SE & Co. KGaA | 376,651 | $ | 20,405,650 | |||||
SAP SE | 761,951 | 104,738,610 | ||||||
Vonovia SE | 380,706 | 18,181,836 | ||||||
143,326,096 | ||||||||
India | 1.1% | ||||||||
ICICI Bank, Ltd. Sponsored ADR | 2,561,530 | 32,249,663 | ||||||
Ireland | 1.1% | ||||||||
Ryanair Holdings PLC Sponsored ADR (*) | 482,339 | 30,937,223 | ||||||
Israel | 1.2% | ||||||||
Bank Leumi Le-Israel BM | 4,665,412 | 33,711,602 | ||||||
Japan | 12.8% | ||||||||
Daiwa House Industry Co., Ltd. | 2,119,878 | 61,909,354 | ||||||
Hitachi, Ltd. | 594,000 | 21,830,676 | ||||||
Kao Corp. | 477,180 | 36,404,129 | ||||||
Makita Corp. | 965,700 | 32,903,394 | ||||||
Nexon Co., Ltd. (*) | 2,690,100 | 39,054,057 | ||||||
Pan Pacific International Holdings Corp. | 414,764 | 26,362,798 | ||||||
Shin-Etsu Chemical Co., Ltd. | 542,800 | 50,680,448 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 1,237,700 | 43,826,924 | ||||||
Suzuki Motor Corp. | 622,000 | 29,276,956 | ||||||
Yamaha Corp. | 542,600 | 25,835,089 | ||||||
368,083,825 | ||||||||
Netherlands | 7.4% | ||||||||
ABN AMRO Group NV | 1,252,786 | 26,806,666 | ||||||
Koninklijke DSM NV | 327,168 | 40,452,060 | ||||||
Royal Dutch Shell PLC, A Shares | 2,932,360 | 96,019,392 | ||||||
Wolters Kluwer NV | 673,988 | 49,068,038 | ||||||
212,346,156 | ||||||||
Norway | 2.3% | ||||||||
Equinor ASA | 1,376,080 | 27,262,860 | ||||||
Telenor ASA | 1,880,403 | 39,959,877 | ||||||
67,222,737 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 87
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Portfolio (continued) | ||||||||
Singapore | 2.7% | ||||||||
DBS Group Holdings, Ltd. | 2,763,620 | $ | 53,052,118 | |||||
NetLink NBN Trust | 35,721,000 | 23,496,920 | ||||||
76,549,038 | ||||||||
South Korea | 1.2% | ||||||||
Samsung Electronics Co., Ltd. | 860,772 | 35,095,375 | ||||||
Spain | 1.4% | ||||||||
Red Electrica Corporacion SA | 1,974,000 | 41,097,428 | ||||||
Sweden | 3.5% | ||||||||
Assa Abloy AB, Class B | 2,784,403 | 63,034,832 | ||||||
Epiroc AB, Class A | 3,688,520 | 38,406,196 | ||||||
101,441,028 | ||||||||
Switzerland | 4.8% | ||||||||
ABB, Ltd. | 1,191,451 | 23,925,328 | ||||||
Novartis AG | 1,240,285 | 113,445,157 | ||||||
137,370,485 | ||||||||
United Arab Emirates | 0.5% | ||||||||
Network International Holdings PLC | 1,963,940 | 14,798,852 | ||||||
United Kingdom | 13.5% | ||||||||
Compass Group PLC | 1,757,533 | 42,119,654 | ||||||
Diageo PLC | 864,481 | 37,228,233 | ||||||
Howden Joinery Group PLC | 2,039,325 | 13,131,444 | ||||||
Informa PLC | 3,605,570 | 38,277,900 | ||||||
Prudential PLC | 3,107,297 | 67,679,013 | ||||||
RELX PLC | 3,130,074 | 76,074,004 | ||||||
RSA Insurance Group PLC | 3,845,027 | 28,232,703 | ||||||
The Weir Group PLC | 941,617 | 18,496,762 | ||||||
Unilever PLC | 1,084,641 | 67,353,898 | ||||||
388,593,611 |
The accompanying notes are an integral part of these financial statements.
88 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Portfolio (concluded) | ||||||||
United States | 6.7% | ||||||||
Aon PLC | 456,575 | $ | 88,109,843 | |||||
Ferguson PLC (*) | 398,564 | 28,409,225 | ||||||
Medtronic PLC | 796,910 | 77,611,065 | ||||||
194,130,133 | ||||||||
Total Common Stocks (Cost $2,418,215,498) | 2,719,215,580 | |||||||
Preferred Stocks | 1.7% | ||||||||
Germany | 1.7% | ||||||||
Volkswagen AG (Cost $55,279,849) | 298,608 | 50,322,906 | ||||||
Short-Term Investments | 3.6% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $102,933,421) | 102,933,421 | 102,933,421 | ||||||
Total Investments | 99.8% (Cost $2,576,428,768) | $ | 2,872,471,907 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.2% | 5,012,278 | |||||||
Net Assets | 100.0% | $ | 2,877,484,185 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 89
The accompanying notes are an integral part of these financial statements.
90 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Select Portfolio (continued) | ||||||||
Sanofi | 22,146 | $ | 1,915,826 | |||||
Ubisoft Entertainment SA (*) | 8,830 | 692,274 | ||||||
Vinci SA | 11,333 | 1,161,946 | ||||||
Vivendi SA | 49,668 | 1,368,938 | ||||||
10,736,782 | ||||||||
Germany | 3.5% | ||||||||
SAP SE | 23,551 | 3,237,346 | ||||||
India | 2.3% | ||||||||
ICICI Bank, Ltd. Sponsored ADR | 169,465 | 2,133,564 | ||||||
Indonesia | 0.9% | ||||||||
PT Telekomunikasi Indonesia (Persero) Tbk Sponsored ADR | 29,158 | 852,580 | ||||||
Ireland | 0.9% | ||||||||
Ryanair Holdings PLC Sponsored ADR (*) | 13,397 | 859,284 | ||||||
Japan | 8.0% | ||||||||
Daiwa House Industry Co., Ltd. | 44,500 | 1,299,587 | ||||||
Kao Corp. | 12,300 | 938,369 | ||||||
Komatsu, Ltd. | 50,600 | 1,226,198 | ||||||
Makita Corp. | 25,400 | 865,430 | ||||||
Ryohin Keikaku Co., Ltd. | 4,800 | 868,498 | ||||||
Sumitomo Mitsui Financial Group, Inc. | 36,776 | 1,302,237 | ||||||
Suzuki Motor Corp. | 19,600 | 922,554 | ||||||
7,422,873 | ||||||||
Mexico | 0.9% | ||||||||
Grupo Financiero Banorte SAB de CV, Class O | 149,800 | 869,123 | ||||||
Netherlands | 7.2% | ||||||||
ABN AMRO Group NV | 40,133 | 858,752 | ||||||
Koninklijke DSM NV | 7,724 | 955,019 | ||||||
Royal Dutch Shell PLC, A Shares | 89,918 | 2,928,029 | ||||||
Wolters Kluwer NV | 26,449 | 1,925,554 | ||||||
6,667,354 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 91
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Select Portfolio (continued) | ||||||||
Norway | 2.6% | ||||||||
Equinor ASA | 50,123 | $ | 993,035 | |||||
Telenor ASA | 68,459 | 1,454,802 | ||||||
2,447,837 | ||||||||
Russia | 1.0% | ||||||||
Yandex NV Class A (*) | 24,900 | 946,200 | ||||||
Singapore | 1.9% | ||||||||
DBS Group Holdings, Ltd. | 90,300 | 1,733,453 | ||||||
South Africa | 3.2% | ||||||||
Mr Price Group, Ltd. | 35,938 | 506,527 | ||||||
Naspers, Ltd., N Shares | 5,850 | 1,421,164 | ||||||
Sanlam, Ltd. | 195,145 | 1,084,307 | ||||||
3,011,998 | ||||||||
South Korea | 1.2% | ||||||||
Samsung Electronics Co., Ltd. | 27,026 | 1,101,904 | ||||||
Spain | 1.1% | ||||||||
Red Electrica Corporacion SA | 47,711 | 993,313 | ||||||
Sweden | 2.4% | ||||||||
Assa Abloy AB, Class B | 96,761 | 2,190,528 | ||||||
Switzerland | 5.9% | ||||||||
ABB, Ltd. | 8,487 | 170,426 | ||||||
Alcon, Inc. (*) | 6,096 | 377,027 | ||||||
Cie Financiere Richemont SA | 8,601 | 730,001 | ||||||
Lonza Group AG | 2,786 | 940,205 | ||||||
Novartis AG | 30,587 | 2,797,701 | ||||||
Sonova Holding AG | 2,046 | 465,725 | ||||||
5,481,085 | ||||||||
Taiwan | 1.2% | ||||||||
Taiwan Semiconductor Manufacturing Co., Ltd. | 146,141 | 1,114,841 |
The accompanying notes are an integral part of these financial statements.
92 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Select Portfolio (concluded) | ||||||||
Thailand | 0.7% | ||||||||
Kasikornbank Public Co. Ltd. | 107,300 | $ | 663,026 | |||||
United Kingdom | 8.3% | ||||||||
Compass Group PLC | 47,875 | 1,147,335 | ||||||
Prudential PLC | 117,649 | 2,562,474 | ||||||
RELX PLC | 80,263 | 1,950,730 | ||||||
Unilever PLC | 33,077 | 2,054,011 | ||||||
7,714,550 | ||||||||
United States | 8.6% | ||||||||
Accenture PLC, Class A | 12,350 | 2,281,909 | ||||||
Aon PLC | 12,660 | 2,443,127 | ||||||
Ferguson PLC (*) | 10,598 | 755,414 | ||||||
Medtronic PLC | 25,225 | 2,456,663 | ||||||
7,937,113 | ||||||||
Total Common Stocks (Cost $81,278,836) | 85,905,469 | |||||||
Preferred Stocks | 1.7% | ||||||||
Germany | 1.7% | ||||||||
Volkswagen AG (Cost $1,671,999) | 9,624 | 1,621,884 | ||||||
Short-Term Investments | 4.1% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $3,822,174) | 3,822,174 | 3,822,174 | ||||||
Total Investments | 98.3% (Cost $86,773,009) | $ | 91,349,527 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.7% | 1,533,395 | |||||||
Net Assets | 100.0% | $ | 92,882,922 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 93
The accompanying notes are an integral part of these financial statements.
94 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Value Portfolio (continued) | ||||||||
Netherlands | 7.9% | ||||||||
Euronext NV | 7,758 | $ | 587,114 | |||||
Intertrust NV | 25,330 | 522,876 | ||||||
Koninklijke DSM NV | 7,105 | 878,484 | ||||||
1,988,474 | ||||||||
South Korea | 3.9% | ||||||||
Kangwon Land, Inc. | 37,803 | 990,201 | ||||||
Spain | 3.2% | ||||||||
Indra Sistemas SA (*) | 80,002 | 808,816 | ||||||
Switzerland | 4.0% | ||||||||
Coca-Cola HBC AG (*) | 6,788 | 256,867 | ||||||
Glencore PLC | 217,353 | 756,329 | ||||||
1,013,196 | ||||||||
United Kingdom | 16.5% | ||||||||
BP PLC | 89,216 | 623,479 | ||||||
Cineworld Group PLC | 314,470 | 1,014,816 | ||||||
Prudential PLC | 47,142 | 1,026,784 | ||||||
Standard Chartered PLC | 55,999 | 509,562 | ||||||
Vodafone Group PLC | 600,203 | 984,521 | ||||||
4,159,162 | ||||||||
United States | 3.6% | ||||||||
International Game Technology PLC | 70,372 | 912,725 | ||||||
Total Common Stocks (Cost $23,244,699) | 22,944,975 | |||||||
Preferred Stocks | 3.5% | ||||||||
Germany | 3.5% | ||||||||
Volkswagen AG (Cost $876,589) | 5,202 | 876,667 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 95
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Equity Value Portfolio (concluded) | ||||||||
Short-Term Investments | 4.6% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $1,152,313) | 1,152,313 | $ | 1,152,313 | |||||
Total Investments | 98.9% (Cost $25,273,601) | $ | 24,973,955 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.1% | 286,112 | |||||||
Net Assets | 100.0% | $ | 25,260,067 |
The accompanying notes are an integral part of these financial statements.
96 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 97
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Small Cap Equity Portfolio (continued) | ||||||||
France | 2.2% | ||||||||
Chargeurs SA | 30,547 | $ | 605,790 | |||||
Kaufman & Broad SA | 17,231 | 659,506 | ||||||
1,265,296 | ||||||||
Germany | 10.1% | ||||||||
Aroundtown SA | 140,216 | 1,155,288 | ||||||
AURELIUS Equity Opportunities SE & Co. KGaA | 10,122 | 480,944 | ||||||
CompuGroup Medical SE | 8,146 | 657,660 | ||||||
Corestate Capital Holding SA | 12,199 | 416,838 | ||||||
Dermapharm Holding SE | 22,426 | 774,681 | ||||||
FinTech Group AG (*) | 28,471 | 630,653 | ||||||
JOST Werke AG | 19,369 | 678,418 | ||||||
Norma Group SE | 11,290 | 467,812 | ||||||
PATRIZIA Immobilien AG | 26,142 | 541,010 | ||||||
5,803,304 | ||||||||
Greece | 0.8% | ||||||||
JUMBO SA | 24,261 | 469,072 | ||||||
Hong Kong | 0.9% | ||||||||
China Water Affairs Group, Ltd. | 526,000 | 518,032 | ||||||
India | 1.3% | ||||||||
Jubilant Life Sciences, Ltd. | 44,902 | 333,236 | ||||||
NIIT Technologies, Ltd. | 22,018 | 428,989 | ||||||
762,225 | ||||||||
Ireland | 3.3% | ||||||||
Dalata Hotel Group PLC | 119,762 | 640,738 | ||||||
Glenveagh Properties PLC (*) | 558,157 | 464,756 | ||||||
Total Produce PLC | 487,135 | 817,665 | ||||||
1,923,159 | ||||||||
Italy | 3.5% | ||||||||
Banca Generali SpA | 26,996 | 778,020 | ||||||
Carel Industries SpA | 49,981 | 608,117 | ||||||
Cerved Group SpA | 70,367 | 623,170 | ||||||
2,009,307 |
The accompanying notes are an integral part of these financial statements.
98 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Small Cap Equity Portfolio (continued) | ||||||||
Japan | 24.1% | ||||||||
Ai Holdings Corp. | 36,860 | $ | 596,615 | |||||
Ariake Japan Co., Ltd. | 9,900 | 626,506 | ||||||
ARTERIA Networks Corp. | 64,600 | 748,235 | ||||||
Digital Garage, Inc. | 24,600 | 782,644 | ||||||
en-japan, Inc. | 16,100 | 629,034 | ||||||
Financial Products Group Co., Ltd. | 86,437 | 715,909 | ||||||
GMO internet, Inc. | 45,000 | 817,739 | ||||||
Jafco Co., Ltd. | 18,400 | 675,647 | ||||||
Japan Lifeline Co., Ltd. | 42,700 | 692,801 | ||||||
KOMEDA Holdings Co., Ltd. | 42,100 | 793,945 | ||||||
Koshidaka Holdings Co., Ltd. | 47,900 | 674,336 | ||||||
Nippon Shinyaku Co., Ltd. | 9,300 | 658,651 | ||||||
Open House Co., Ltd. | 20,200 | 829,898 | ||||||
Persol Holdings Co., Ltd. | 36,900 | 869,389 | ||||||
Sanwa Holdings Corp. | 62,900 | 677,917 | ||||||
TechnoPro Holdings, Inc. | 14,245 | 759,172 | ||||||
Tsuruha Holdings, Inc. | 7,400 | 684,954 | ||||||
USS Co., Ltd. | 40,200 | 793,426 | ||||||
Zenkoku Hosho Co., Ltd. | 23,042 | 885,893 | ||||||
13,912,711 | ||||||||
Jersey | 1.5% | ||||||||
JTC PLC | 177,680 | 839,973 | ||||||
Luxembourg | 0.8% | ||||||||
Stabilus SA | 9,727 | 451,271 | ||||||
Netherlands | 2.2% | ||||||||
Aalberts Industries NV | 15,457 | 607,686 | ||||||
Van Lanschot Kempen NV | 28,829 | 654,364 | ||||||
1,262,050 | ||||||||
New Zealand | 2.0% | ||||||||
Freightways, Ltd. | 110,397 | 625,398 | ||||||
Mainfreight, Ltd. | 19,980 | 546,974 | ||||||
1,172,372 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 99
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Small Cap Equity Portfolio (continued) | ||||||||
Singapore | 0.8% | ||||||||
XP Power, Ltd. | 16,042 | $ | 450,247 | |||||
Sweden | 8.5% | ||||||||
Dometic Group AB | 75,049 | 752,641 | ||||||
Granges AB | 57,101 | 654,285 | ||||||
Indutrade AB | 20,123 | 643,210 | ||||||
Karnov Group AB (*) | 203,434 | 898,838 | ||||||
Lifco AB, B Shares | 13,556 | 751,142 | ||||||
Lindab International AB | 51,713 | 594,824 | ||||||
Loomis AB, B Shares | 18,293 | 628,812 | ||||||
4,923,752 | ||||||||
Switzerland | 1.3% | ||||||||
Kardex AG | 4,361 | 762,227 | ||||||
Thailand | 0.4% | ||||||||
Hana Microelectronics Public Co., Ltd. (‡) | 298,100 | 250,300 | ||||||
United Kingdom | 14.6% | ||||||||
Ascential PLC | 139,031 | 629,748 | ||||||
Auto Trader Group PLC | 79,008 | 550,636 | ||||||
Burford Capital, Ltd. | �� | 31,343 | 617,360 | |||||
Clinigen Healthcare, Ltd. | 76,155 | 976,103 | ||||||
Electrocomponents PLC | 75,269 | 604,957 | ||||||
Equiniti Group PLC | 230,927 | 645,381 | ||||||
GB Group PLC | 64,314 | 452,422 | ||||||
Hunting PLC | 88,054 | 572,666 | ||||||
Huntsworth PLC | 507,372 | 627,072 | ||||||
Polypipe Group PLC | 141,965 | 802,320 | ||||||
Rentokil Initial PLC | 158,678 | 801,793 | ||||||
Rightmove PLC | 82,105 | 557,889 | ||||||
Smart Metering Systems PLC | 82,308 | 555,936 | ||||||
8,394,283 | ||||||||
Total Common Stocks (Cost $53,786,988) | 55,926,591 |
The accompanying notes are an integral part of these financial statements.
100 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Small Cap Equity Portfolio (concluded) | ||||||||
Short-Term Investments | 0.2% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $125,396) | 125,396 | $ | 125,396 | |||||
Total Investments | 97.3% (Cost $53,912,384) | $ | 56,051,987 | ||||||
Cash and Other Assets in Excess of Liabilities | 2.7% | 1,544,578 | |||||||
Net Assets | 100.0% | $ | 57,596,565 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 101
The accompanying notes are an integral part of these financial statements.
102 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Strategic Equity Portfolio (continued) | ||||||||
India | 1.9% | ||||||||
Housing Development Finance Corp., Ltd. | 2,408,215 | $ | 76,477,463 | |||||
ICICI Bank, Ltd. Sponsored ADR | 3,743,729 | 47,133,548 | ||||||
123,611,011 | ||||||||
Ireland | 1.0% | ||||||||
Ryanair Holdings PLC Sponsored ADR (*) | 1,005,036 | 64,463,009 | ||||||
Israel | 1.3% | ||||||||
Bank Leumi Le-Israel BM | 11,828,341 | 85,469,906 | ||||||
Japan | 13.5% | ||||||||
AEON Financial Service Co., Ltd. | 4,638,375 | 74,554,940 | ||||||
Daiwa House Industry Co., Ltd. | 3,976,207 | 116,121,969 | ||||||
en-japan, Inc. | 842,197 | 32,904,978 | ||||||
Kao Corp. | 1,201,853 | 91,689,532 | ||||||
Komatsu, Ltd. | 3,642,325 | 88,265,053 | ||||||
Makita Corp. | 3,364,291 | 114,628,344 | ||||||
Nexon Co., Ltd. (*) | 8,454,335 | 122,737,476 | ||||||
Pan Pacific International Holdings Corp. | 951,293 | 60,465,097 | ||||||
Suzuki Motor Corp. | 2,118,872 | 99,733,317 | ||||||
Yamaha Corp. | 1,286,972 | 61,277,250 | ||||||
862,377,956 | ||||||||
Mexico | 0.4% | ||||||||
Grupo Financiero Banorte SAB de CV, Class O | 4,742,700 | 27,516,617 | ||||||
Netherlands | 3.6% | ||||||||
ABN AMRO Group NV | 4,770,854 | 102,085,024 | ||||||
Wolters Kluwer NV | 1,785,377 | 129,979,979 | ||||||
232,065,003 | ||||||||
Norway | 1.5% | ||||||||
Equinor ASA | 4,776,328 | 94,628,480 | ||||||
Philippines | 0.7% | ||||||||
GT Capital Holdings, Inc. | 2,428,320 | 44,563,165 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 103
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Strategic Equity Portfolio (continued) | ||||||||
Singapore | 2.1% | ||||||||
DBS Group Holdings, Ltd. | 6,948,471 | $ | 133,387,045 | |||||
Sweden | 3.3% | ||||||||
Assa Abloy AB, Class B | 5,031,033 | 113,895,267 | ||||||
Hexagon AB, B Shares | 1,743,683 | 96,826,795 | ||||||
210,722,062 | ||||||||
Switzerland | 7.2% | ||||||||
ABB, Ltd. | 2,812,109 | 56,469,491 | ||||||
Alcon, Inc. (*) | 688,989 | 42,612,768 | ||||||
Julius Baer Group, Ltd. | 2,571,857 | 114,733,249 | ||||||
Novartis AG | 1,696,809 | 155,202,040 | ||||||
Partners Group Holding AG | 119,683 | 94,042,884 | ||||||
463,060,432 | ||||||||
United Kingdom | 16.2% | ||||||||
Bunzl PLC | 2,900,824 | �� | 76,645,123 | |||||
CNH Industrial NV | 53,917 | 551,504 | ||||||
Coca-Cola European Partners PLC | 2,290,541 | 127,520,059 | ||||||
Compass Group PLC | 3,738,896 | 89,603,441 | ||||||
Diageo PLC | 3,691,953 | 158,991,217 | ||||||
Informa PLC | 15,102,635 | 160,334,469 | ||||||
Prudential PLC | 5,094,850 | 110,969,251 | ||||||
RELX PLC | 5,181,541 | 125,933,307 | ||||||
Rio Tinto PLC | 2,119,203 | 130,744,264 | ||||||
The Weir Group PLC | 2,886,738 | 56,705,971 | ||||||
1,037,998,606 | ||||||||
United States | 8.3% | ||||||||
Accenture PLC, Class A | 1,060,468 | 195,942,673 | ||||||
Aon PLC | 922,740 | 178,070,365 | ||||||
Medtronic PLC | 1,621,623 | 157,929,864 | ||||||
531,942,902 | ||||||||
Total Common Stocks (Cost $5,145,381,071) | 5,967,889,198 |
The accompanying notes are an integral part of these financial statements.
104 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard International Strategic Equity Portfolio (concluded) | ||||||||
Preferred Stocks | 2.3% | ||||||||
Germany | 2.3% | ||||||||
Volkswagen AG (Cost $170,537,894) | 904,227 | $ | 152,384,833 | |||||
Short-Term Investments | 3.5% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $222,496,138) | 222,496,138 | 222,496,138 | ||||||
Total Investments | 99.0% (Cost $5,538,415,103) | $ | 6,342,770,169 | ||||||
Cash and Other Assets in Excess of Liabilities | 1.0% | 60,985,647 | |||||||
Net Assets | 100.0% | $ | 6,403,755,816 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 105
The accompanying notes are an integral part of these financial statements.
106 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
Teck Resources, Ltd., Class B | 2,930 | $ | 67,614 | |||||
The Toronto-Dominion Bank | 3,667 | 214,271 | ||||||
1,712,867 | ||||||||
China | 0.3% | ||||||||
Yangzijiang Shipbuilding Holdings, Ltd. | 61,000 | 69,162 | ||||||
Denmark | 1.4% | ||||||||
Coloplast A/S, Class B | 695 | 78,715 | ||||||
H. Lundbeck A/S | 1,562 | 61,769 | ||||||
Novo Nordisk A/S, Class B | 2,231 | 113,803 | ||||||
SimCorp A/S | 1,004 | 97,100 | ||||||
351,387 | ||||||||
France | 1.2% | ||||||||
Electricite de France SA | 4,362 | 55,014 | ||||||
Hermes International | 95 | 68,518 | ||||||
Ipsen SA | 501 | 68,365 | ||||||
Total SA | 1,832 | 102,503 | ||||||
294,400 | ||||||||
Germany | 1.4% | ||||||||
Allianz SE | 543 | 130,871 | ||||||
Deutsche Lufthansa AG | 3,320 | 56,892 | ||||||
Muenchener Rueckversicherungs AG | 342 | 85,833 | ||||||
Rheinmetall AG | 664 | 81,280 | ||||||
354,876 | ||||||||
Hong Kong | 1.4% | ||||||||
CK Hutchison Holdings, Ltd. | 5,500 | 54,113 | ||||||
Jardine Matheson Holdings, Ltd. | 700 | 44,119 | ||||||
Swire Pacific, Ltd., Class A | 20,500 | 252,237 | ||||||
350,469 | ||||||||
Israel | 1.4% | ||||||||
Bank Leumi Le-Israel BM | 20,375 | 147,227 | ||||||
Israel Discount Bank, Ltd., Class A | 50,710 | 207,342 | ||||||
354,569 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 107
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
Italy | 3.0% | ||||||||
Enel SpA | 50,948 | $ | 355,986 | |||||
Hera SpA | 22,215 | 85,023 | ||||||
Italgas SpA | 13,087 | 87,863 | ||||||
Poste Italiane SpA | 12,320 | 129,788 | ||||||
Terna SpA | 17,479 | 111,364 | ||||||
770,024 | ||||||||
Japan | 6.3% | ||||||||
Amano Corp. | 2,500 | 69,162 | ||||||
ANA Holdings, Inc. | 1,500 | 49,708 | ||||||
Daito Trust Construction Co., Ltd. | 700 | 89,109 | ||||||
Daiwa House Industry Co., Ltd. | 5,200 | 151,862 | ||||||
East Japan Railway Co. | 800 | 74,920 | ||||||
Japan Airlines Co., Ltd. | 1,600 | 51,186 | ||||||
Japan Post Holdings Co., Ltd. | 16,900 | 191,475 | ||||||
Japan Prime Realty Investment Corp. REIT | 14 | 60,647 | ||||||
McDonald’s Holdings Co. Japan, Ltd. | 2,600 | 114,665 | ||||||
Nissan Chemical Corp. | 1,300 | 58,702 | ||||||
NTT DOCOMO, Inc. | 14,200 | 331,408 | ||||||
Seven & I Holdings Co., Ltd. | 3,700 | 125,413 | ||||||
Sumitomo Mitsui Construction Co., Ltd. | 12,200 | 67,711 | ||||||
Taisei Corp. | 1,600 | 58,236 | ||||||
The Dai-ichi Life Insurance Co., Ltd. | 5,200 | 78,672 | ||||||
The Gunma Bank, Ltd. | 6,600 | 23,187 | ||||||
1,596,063 | ||||||||
Netherlands | 1.0% | ||||||||
Euronext NV | 1,215 | 91,949 | ||||||
Koninklijke Ahold Delhaize NV | 3,769 | 84,767 | ||||||
Royal Dutch Shell PLC, A Shares | 2,090 | 68,437 | ||||||
245,153 | ||||||||
Norway | 1.9% | ||||||||
Equinor ASA | 6,578 | 130,323 | ||||||
Leroy Seafood Group ASA | 8,044 | 53,313 | ||||||
Salmar ASA | 1,939 | 84,325 | ||||||
Telenor ASA | 10,028 | 213,102 | ||||||
481,063 |
The accompanying notes are an integral part of these financial statements.
108 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
Puerto Rico | 0.4% | ||||||||
EVERTEC, Inc. | 2,868 | $ | 93,783 | |||||
Singapore | 1.0% | ||||||||
Jardine Cycle & Carriage, Ltd. | 3,200 | 85,847 | ||||||
Singapore Technologies Engineering, Ltd. | 59,600 | 182,689 | ||||||
268,536 | ||||||||
Spain | 0.6% | ||||||||
Corporacion Financiera Alba SA | 435 | 22,804 | ||||||
Iberdrola SA | 13,480 | 134,461 | ||||||
157,265 | ||||||||
Sweden | 0.3% | ||||||||
Axfood AB | 4,338 | 85,840 | ||||||
Switzerland | 3.9% | ||||||||
Helvetia Holding AG | 485 | 60,941 | ||||||
Novartis AG | 2,509 | 229,491 | ||||||
Partners Group Holding AG | 108 | 84,863 | ||||||
Roche Holding AG | 1,562 | 439,494 | ||||||
The Swatch Group AG | 1,124 | 60,861 | ||||||
Zurich Insurance Group AG | 366 | 127,446 | ||||||
1,003,096 | ||||||||
United Kingdom | 3.8% | ||||||||
Admiral Group PLC | 3,473 | 97,576 | ||||||
Anglo American PLC | 4,746 | 135,755 | ||||||
Auto Trader Group PLC | 9,633 | 67,136 | ||||||
Britvic PLC | 4,785 | 54,037 | ||||||
Centrica PLC | 49,328 | 54,993 | ||||||
Compass Group PLC | 5,200 | 124,619 | ||||||
Howden Joinery Group PLC | 8,569 | 55,177 | ||||||
Imperial Brands PLC | 2,218 | 52,079 | ||||||
International Consolidated Airlines Group SA | 6,485 | 39,339 | ||||||
National Grid PLC | 8,766 | 93,158 | ||||||
Rio Tinto, Ltd. | 1,029 | 75,085 | ||||||
SSP Group PLC | 6,350 | 55,388 | ||||||
WH Smith PLC | 3,030 | 75,810 | ||||||
980,152 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 109
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
United States | 54.3% | ||||||||
3M Co. | 456 | $ | 79,043 | |||||
AbbVie, Inc. | 1,204 | 87,555 | ||||||
ACI Worldwide, Inc. (*) | 1,833 | 62,945 | ||||||
AES Corp. | 3,584 | 60,068 | ||||||
Aflac, Inc. | 4,481 | 245,604 | ||||||
Akamai Technologies, Inc. (*) | 1,491 | 119,489 | ||||||
Altria Group, Inc. | 1,563 | 74,008 | ||||||
American Express Co. | 529 | 65,300 | ||||||
American Tower Corp. REIT | 964 | 197,090 | ||||||
Amgen, Inc. | 543 | 100,064 | ||||||
Aon PLC | 2,161 | 417,030 | ||||||
Apple, Inc. | 343 | 67,887 | ||||||
AutoZone, Inc. (*) | 115 | 126,439 | ||||||
Avnet, Inc. | 1,706 | 77,231 | ||||||
AXA Equitable Holdings, Inc. | 3,833 | 80,110 | ||||||
Booking Holdings, Inc. (*) | 27 | 50,617 | ||||||
Brinker International, Inc. | 1,992 | 78,385 | ||||||
Bristol-Myers Squibb Co. | 2,159 | 97,911 | ||||||
Broadcom, Inc. | 227 | 65,344 | ||||||
Broadridge Financial Solutions, Inc. | 591 | 75,459 | ||||||
Burlington Stores, Inc. (*) | 358 | 60,914 | ||||||
Cable One, Inc. | 58 | 67,917 | ||||||
Cadence Design Systems, Inc. (*) | 1,503 | 106,427 | ||||||
CBRE Group, Inc., Class A (*) | 1,210 | 62,073 | ||||||
CDW Corp. | 749 | 83,139 | ||||||
Church & Dwight Co., Inc. | 876 | 64,001 | ||||||
Cigna Corp. | 471 | 74,206 | ||||||
Colgate-Palmolive Co. | 2,822 | 202,253 | ||||||
Comcast Corp., Class A | 1,632 | 69,001 | ||||||
ConocoPhillips | 885 | 53,985 | ||||||
Darden Restaurants, Inc. | 1,878 | 228,609 | ||||||
Edison International | 3,315 | 223,464 | ||||||
Eli Lilly & Co. | 3,034 | 336,137 | ||||||
Encompass Health Corp. | 2,223 | 140,849 | ||||||
EPR Properties REIT | 801 | 59,747 |
The accompanying notes are an integral part of these financial statements.
110 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
Exelon Corp. | 2,415 | $ | 115,775 | |||||
Exponent, Inc. | 1,054 | 61,701 | ||||||
F5 Networks, Inc. (*) | 1,200 | 174,756 | ||||||
FactSet Research Systems, Inc. | 245 | 70,207 | ||||||
Fidelity National Information Services, Inc. | 1,217 | 149,302 | ||||||
HCA Healthcare, Inc. | 450 | 60,827 | ||||||
HEICO Corp., Class A | 604 | 62,435 | ||||||
Honeywell International, Inc. | 764 | 133,387 | ||||||
Insperity, Inc. | 579 | 70,719 | ||||||
Intel Corp. | 1,257 | 60,173 | ||||||
Intuit, Inc. | 530 | 138,505 | ||||||
IQVIA Holdings, Inc. (*) | 330 | 53,097 | ||||||
Johnson & Johnson | 2,581 | 359,482 | ||||||
Kellogg Co. | 1,051 | 56,302 | ||||||
Kimberly-Clark Corp. | 2,251 | 300,013 | ||||||
Kimco Realty Corp. REIT | 3,331 | 61,557 | ||||||
Life Storage, Inc. REIT | 793 | 75,398 | ||||||
Lockheed Martin Corp. | 264 | 95,975 | ||||||
LPL Financial Holdings, Inc. | 883 | 72,026 | ||||||
Lululemon Athletica, Inc. (*) | 386 | 69,561 | ||||||
MarketAxess Holdings, Inc. | 239 | 76,819 | ||||||
MasterCard, Inc., Class A | 300 | 79,359 | ||||||
McGrath RentCorp | 1,021 | 63,455 | ||||||
Mellanox Technologies, Ltd. (*) | 752 | 83,224 | ||||||
Merck & Co., Inc. | 3,033 | 254,317 | ||||||
MetLife, Inc. | 1,546 | 76,790 | ||||||
Morgan Stanley | 2,553 | 111,847 | ||||||
Morningstar, Inc. | 419 | 60,604 | ||||||
Nasdaq, Inc. | 819 | 78,763 | ||||||
NetApp, Inc. | 823 | 50,779 | ||||||
NIKE, Inc., Class B | 2,594 | 217,766 | ||||||
Nordstrom, Inc. | 1,818 | 57,921 | ||||||
Northrop Grumman Corp. | 541 | 174,803 | ||||||
Occidental Petroleum Corp. | 1,561 | 78,487 | ||||||
Omnicom Group, Inc. | 1,377 | 112,845 | ||||||
PepsiCo, Inc. | 2,365 | 310,122 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 111
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (continued) | ||||||||
Philip Morris International, Inc. | 1,757 | $ | 137,977 | |||||
Pinnacle West Capital Corp. | 3,944 | 371,091 | ||||||
Premier, Inc., Class A (*) | 3,613 | 141,304 | ||||||
Public Service Enterprise Group, Inc. | 1,268 | 74,584 | ||||||
Ralph Lauren Corp. | 646 | 73,379 | ||||||
Raytheon Co. | 273 | 47,469 | ||||||
Republic Services, Inc. | 4,244 | 367,700 | ||||||
Ross Stores, Inc. | 501 | 49,659 | ||||||
Simon Property Group, Inc. REIT | 1,872 | 299,071 | ||||||
Starbucks Corp. | 4,621 | 387,378 | ||||||
Synchrony Financial | 2,243 | 77,765 | ||||||
Sysco Corp. | 5,317 | 376,018 | ||||||
T-Mobile US, Inc. (*) | 2,026 | 150,208 | ||||||
TE Connectivity, Ltd. | 679 | 65,035 | ||||||
The Estee Lauder Cos., Inc., Class A | 2,405 | 440,380 | ||||||
The Hershey Co. | 2,778 | 372,335 | ||||||
The Procter & Gamble Co. | 3,564 | 390,793 | ||||||
The Progressive Corp. | 1,052 | 84,086 | ||||||
The TJX Cos., Inc. | 6,963 | 368,203 | ||||||
Tractor Supply Co. | 615 | 66,912 | ||||||
Tyson Foods, Inc., Class A | 1,536 | 124,017 | ||||||
USANA Health Sciences, Inc. (*) | 818 | 64,974 | ||||||
Varian Medical Systems, Inc. (*) | 436 | 59,353 | ||||||
Verizon Communications, Inc. | 5,948 | 339,809 | ||||||
Vocera Communications, Inc. (*) | 2,459 | 78,491 | ||||||
Walmart, Inc. | 1,072 | 118,445 | ||||||
Waste Management, Inc. | 2,485 | 286,694 | ||||||
WW Grainger, Inc. | 350 | 93,881 | ||||||
Zoetis, Inc. | 968 | 109,858 | ||||||
13,806,269 | ||||||||
Total Common Stocks (Cost $23,196,901) | | | | | | | 24,764,731 | |
The accompanying notes are an integral part of these financial statements.
112 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Managed Equity Volatility Portfolio (concluded) | ||||||||
Short-Term Investments | 3.1% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $778,116) | 778,116 | $ | 778,116 | |||||
Total Investments | 100.5% (Cost $23,975,017) | $ | 25,542,847 | ||||||
Liabilities in Excess of Cash and Other Assets | (0.5)% | (136,801 | ) | ||||||
Net Assets | 100.0% | $ | 25,406,046 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 113
The accompanying notes are an integral part of these financial statements.
114 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard US Equity Concentrated Portfolio (concluded) | ||||||||
IT Services | 4.3% | ||||||||
Fiserv, Inc. (*) | 381,157 | $ | 34,746,272 | |||||
Sabre Corp. | 939,700 | 20,861,340 | ||||||
55,607,612 | ||||||||
Machinery | 1.1% | ||||||||
Kennametal, Inc. | 387,575 | 14,336,399 | ||||||
Pharmaceuticals | 4.0% | ||||||||
Elanco Animal Health, Inc. | 1,544,653 | 52,209,271 | ||||||
Semiconductors & Semiconductor Equipment | 11.2% | ||||||||
Analog Devices, Inc. | 774,758 | 87,446,936 | ||||||
Skyworks Solutions, Inc. | 736,549 | 56,913,141 | ||||||
144,360,077 | ||||||||
Specialty Retail | 3.1% | ||||||||
Lowe’s Cos., Inc. | 397,854 | 40,147,447 | ||||||
Total Common Stocks (Cost $1,013,219,205) | 1,210,539,759 | |||||||
Short-Term Investments | 5.9% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $76,788,553) | 76,788,553 | 76,788,553 | ||||||
Total Investments | 99.7% (Cost $1,090,007,758) | $ | 1,287,328,312 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.3% | 4,314,879 | |||||||
Net Assets | 100.0% | $ | 1,291,643,191 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 115
The accompanying notes are an integral part of these financial statements.
116 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard US Equity Select Portfolio (continued) | ||||||||
Equity Real Estate Investment Trusts (REITs) | 1.7% | ||||||||
Prologis, Inc. | 16,960 | $ | 1,358,496 | |||||
Food Products | 1.1% | ||||||||
Mondelez International, Inc., Class A | 16,375 | 882,612 | ||||||
Health Care Equipment & Supplies | 5.6% | ||||||||
Danaher Corp. | 10,517 | 1,503,090 | ||||||
Medtronic PLC | 29,560 | 2,878,848 | ||||||
4,381,938 | ||||||||
Health Care Providers & Services | 4.2% | ||||||||
Anthem, Inc. | 3,555 | 1,003,257 | ||||||
CVS Health Corp. | 10,720 | 584,133 | ||||||
Humana, Inc. | 3,427 | 909,183 | ||||||
Laboratory Corp. of America Holdings (*) | 4,645 | 803,120 | ||||||
3,299,693 | ||||||||
Hotels, Restaurants & Leisure | 3.6% | ||||||||
McDonald’s Corp. | 13,580 | 2,820,023 | ||||||
Household Products | 2.9% | ||||||||
The Procter & Gamble Co. | 20,795 | 2,280,172 | ||||||
Industrial Conglomerates | 3.3% | ||||||||
Honeywell International, Inc. | 14,838 | 2,590,566 | ||||||
Insurance | 2.1% | ||||||||
Aon PLC | 8,465 | 1,633,576 | ||||||
Interactive Media & Services | 4.5% | ||||||||
Alphabet, Inc., Class A (*) | 3,250 | 3,519,100 | ||||||
Internet & Direct Marketing Retail | 0.7% | ||||||||
eBay, Inc. | 13,780 | 544,310 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 117
Description | Shares | Fair Value | ||||||
Lazard US Equity Select Portfolio (continued) | ||||||||
IT Services | 4.2% | ||||||||
Accenture PLC, Class A | 4,445 | $ | 821,303 | |||||
Visa, Inc., Class A | 12,140 | 2,106,897 | ||||||
Worldpay, Inc., Class A (*) | 3,317 | 406,498 | ||||||
3,334,698 | ||||||||
Life Sciences Tools & Services | 1.1% | ||||||||
Thermo Fisher Scientific, Inc. | 3,053 | 896,605 | ||||||
Machinery | 1.9% | ||||||||
Deere & Co. | 8,790 | 1,456,591 | ||||||
Multiline Retail | 1.1% | ||||||||
Dollar General Corp. | 6,484 | 876,377 | ||||||
Oil, Gas & Consumable Fuels | 6.2% | ||||||||
Chevron Corp. | 22,030 | 2,741,413 | ||||||
ConocoPhillips | 15,985 | 975,085 | ||||||
EOG Resources, Inc. | 12,955 | 1,206,888 | ||||||
4,923,386 | ||||||||
Pharmaceuticals | 8.4% | ||||||||
Elanco Animal Health, Inc. | 24,510 | 828,438 | ||||||
Johnson & Johnson | 21,135 | 2,943,683 | ||||||
Pfizer, Inc. | 37,454 | 1,622,507 | ||||||
Zoetis, Inc. | 10,974 | 1,245,439 | ||||||
6,640,067 | ||||||||
Road & Rail | 1.6% | ||||||||
Norfolk Southern Corp. | 6,415 | 1,278,702 | ||||||
Semiconductors & Semiconductor Equipment | 3.6% | ||||||||
Analog Devices, Inc. | 15,428 | 1,741,358 | ||||||
Skyworks Solutions, Inc. | 7,579 | 585,629 | ||||||
Texas Instruments, Inc. | 4,310 | 494,616 | ||||||
2,821,603 |
The accompanying notes are an integral part of these financial statements.
118 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard US Equity Select Portfolio (concluded) | ||||||||
Software | 6.9% | ||||||||
Microsoft Corp. | 33,510 | $ | 4,489,000 | |||||
Palo Alto Networks, Inc. (*) | 4,600 | 937,296 | ||||||
5,426,296 | ||||||||
Specialty Retail | 3.4% | ||||||||
Lowe’s Cos., Inc. | 15,915 | 1,605,983 | ||||||
Ross Stores, Inc. | 10,609 | 1,051,564 | ||||||
2,657,547 | ||||||||
Technology Hardware, Storage & Peripherals | 2.6% | ||||||||
Apple, Inc. | 10,453 | 2,068,858 | ||||||
Total Common Stocks (Cost $63,214,827) | 76,611,315 | |||||||
Short-Term Investments | 2.9% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $2,293,013) | 2,293,013 | 2,293,013 | ||||||
Total Investments | 100.0% (Cost $65,507,840) | $ | 78,904,328 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.0% | 9,773 | |||||||
Net Assets | 100.0% | $ | 78,914,101 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 119
The accompanying notes are an integral part of these financial statements.
120 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard US Realty Equity Portfolio (concluded) | ||||||||
VICI Properties, Inc. | 66,147 | $ | 1,457,880 | |||||
Vornado Realty Trust | 19,978 | 1,280,590 | ||||||
Weyerhaeuser Co. | 77,067 | 2,029,945 | ||||||
Total Real Estate Investment Trusts (Cost $53,748,494) | 63,144,604 | |||||||
Short-Term Investments | 1.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $947,672) | 947,672 | 947,672 | ||||||
Total Investments | 99.9% (Cost $55,727,596) | $ | 65,574,698 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.1% | 94,336 | |||||||
Net Assets | 100.0% | $ | 65,669,034 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 121
The accompanying notes are an integral part of these financial statements.
122 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard US Small-Mid Cap Equity Portfolio (continued) | ||||||||
Chemicals | 3.3% | ||||||||
Ingevity Corp. (*) | 13,480 | $ | 1,417,692 | |||||
Innospec, Inc. | 15,830 | 1,444,329 | ||||||
2,862,021 | ||||||||
Commercial Services & Supplies | 1.2% | ||||||||
The Brink’s Co. | 12,070 | 979,843 | ||||||
Communications Equipment | 1.2% | ||||||||
Ciena Corp. (*) | 24,995 | 1,028,044 | ||||||
Construction Materials | 1.7% | ||||||||
Eagle Materials, Inc. | 15,685 | 1,454,000 | ||||||
Containers & Packaging | 1.0% | ||||||||
Graphic Packaging Holding Co. | 57,910 | 809,582 | ||||||
Electric Utilities | 3.9% | ||||||||
OGE Energy Corp. | 41,700 | 1,774,752 | ||||||
PNM Resources, Inc. | 31,360 | 1,596,538 | ||||||
3,371,290 | ||||||||
Electrical Equipment | 4.0% | ||||||||
Atkore International Group, Inc. (*) | 50,150 | 1,297,380 | ||||||
EnerSys | 16,640 | 1,139,840 | ||||||
Regal Beloit Corp. | 11,915 | 973,575 | ||||||
3,410,795 | ||||||||
Electronic Equipment, Instruments & Components | 1.5% | ||||||||
FLIR Systems, Inc. | 24,130 | 1,305,433 | ||||||
Energy Equipment & Services | 0.7% | ||||||||
Cactus, Inc., Class A (*) | 17,400 | 576,288 | ||||||
Entertainment | 2.4% | ||||||||
Take-Two Interactive Software, Inc. (*) | 12,350 | 1,402,095 | ||||||
The Marcus Corp. | 19,800 | 652,608 | ||||||
2,054,703 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 123
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard US Small-Mid Cap Equity Portfolio (continued) | ||||||||
Equity Real Estate Investment Trusts (REITs) | 11.5% | ||||||||
Alexandria Real Estate Equities, Inc. | 12,825 | $ | 1,809,479 | |||||
Brixmor Property Group, Inc. | 70,205 | 1,255,265 | ||||||
Camden Property Trust | 19,395 | 2,024,644 | ||||||
Hudson Pacific Properties, Inc. | 42,000 | 1,397,340 | ||||||
Kilroy Realty Corp. | 18,440 | 1,361,057 | ||||||
PS Business Parks, Inc. | 12,160 | 2,049,325 | ||||||
9,897,110 | ||||||||
Food Products | 0.7% | ||||||||
The Simply Good Foods Co. (*) | 26,440 | 636,675 | ||||||
Health Care Equipment & Supplies | 4.3% | ||||||||
AngioDynamics, Inc. (*) | 45,969 | 905,130 | ||||||
Avanos Medical, Inc. (*) | 15,420 | 672,466 | ||||||
Lantheus Holdings, Inc. (*) | 24,390 | 690,237 | ||||||
STERIS PLC | 9,220 | 1,372,673 | ||||||
3,640,506 | ||||||||
Health Care Providers & Services | 3.1% | ||||||||
Henry Schein, Inc. (*) | 17,700 | 1,237,230 | ||||||
Laboratory Corp. of America Holdings (*) | 8,415 | 1,454,953 | ||||||
2,692,183 | ||||||||
Hotels, Restaurants & Leisure | 3.0% | ||||||||
Papa John’s International, Inc. | 17,150 | 766,948 | ||||||
Penn National Gaming, Inc. (*) | 49,670 | 956,644 | ||||||
The Cheesecake Factory, Inc. | 19,670 | 859,973 | ||||||
2,583,565 | ||||||||
Household Durables | 1.7% | ||||||||
Leggett & Platt, Inc. | 38,490 | 1,476,861 | ||||||
Insurance | 5.4% | ||||||||
Arch Capital Group, Ltd. (*) | 39,610 | 1,468,739 | ||||||
Brown & Brown, Inc. | 45,625 | 1,528,437 | ||||||
Reinsurance Group of America, Inc. | 10,260 | 1,600,868 | ||||||
4,598,044 |
The accompanying notes are an integral part of these financial statements.
124 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard US Small-Mid Cap Equity Portfolio (continued) | ||||||||
IT Services | 4.9% | ||||||||
CoreLogic, Inc. (*) | 32,080 | $ | 1,341,906 | |||||
Leidos Holdings, Inc. | 22,775 | 1,818,584 | ||||||
Sabre Corp. | 45,050 | 1,000,110 | ||||||
4,160,600 | ||||||||
Life Sciences Tools & Services | 1.3% | ||||||||
Cambrex Corp. (*) | 23,095 | 1,081,077 | ||||||
Machinery | 2.5% | ||||||||
Gardner Denver Holdings, Inc. (*) | 22,640 | 783,344 | ||||||
Kennametal, Inc. | 14,654 | 542,052 | ||||||
TriMas Corp. (*) | 25,690 | 795,619 | ||||||
2,121,015 | ||||||||
Oil, Gas & Consumable Fuels | 1.0% | ||||||||
Parsley Energy, Inc., Class A (*) | 44,100 | 838,341 | ||||||
Pharmaceuticals | 2.7% | ||||||||
Catalent, Inc. (*) | 25,590 | 1,387,234 | ||||||
Elanco Animal Health, Inc. | 28,450 | 961,610 | ||||||
2,348,844 | ||||||||
Professional Services | 1.1% | ||||||||
FTI Consulting, Inc. (*) | 11,560 | 969,190 | ||||||
Semiconductors & Semiconductor Equipment | 2.2% | ||||||||
Maxim Integrated Products, Inc. | 15,800 | 945,156 | ||||||
MKS Instruments, Inc. | 11,975 | 932,733 | ||||||
1,877,889 | ||||||||
Software | 4.6% | ||||||||
CyberArk Software, Ltd. (*) | 6,560 | 838,630 | ||||||
j2 Global, Inc. (*) | 15,585 | 1,385,351 | ||||||
RealPage, Inc. (*) | 18,850 | 1,109,323 | ||||||
SolarWinds Corp. | 34,545 | 633,555 | ||||||
3,966,859 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 125
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard US Small-Mid Cap Equity Portfolio (concluded) | ||||||||
Specialty Retail | 1.8% | ||||||||
Floor & Decor Holdings, Inc., Class A (*) | 20,805 | $ | 871,729 | |||||
Foot Locker, Inc. | 15,355 | 643,682 | ||||||
1,515,411 | ||||||||
Textiles, Apparel & Luxury Goods | 2.2% | ||||||||
Carter’s, Inc. | 9,485 | 925,167 | ||||||
Steven Madden, Ltd. | 29,162 | 990,050 | ||||||
1,915,217 | ||||||||
Trading Companies & Distributors | 1.6% | ||||||||
Air Lease Corp. | 32,600 | 1,347,684 | ||||||
Total Common Stocks (Cost $75,631,067) | 82,339,363 | |||||||
Total Investments | 96.0% (Cost $75,631,067) | $ | 82,339,363 | ||||||
Cash and Other Assets in Excess of Liabilities | 4.0% | 3,413,250 | |||||||
Net Assets | 100.0% | $ | 85,752,613 |
The accompanying notes are an integral part of these financial statements.
126 Semi-Annual Report
The Lazard Funds, Inc.Notes to Portfolios of Investments June 30, 2019 (unaudited)
(*) | Non-income producing security. |
(‡) | Security valued using Level 2 inputs, based on reference to a similar security which was trading on an active market, under GAAP hierarchy — see Note 9 in the Notes to Financial Statements. |
(#) | Pursuant to Rule 144A under the Securities Act of 1933, these securities may only be traded among “qualified institutional buyers.” At June 30, 2019, these securities amounted to 0.7% of net assets of Emerging Markets Equity Advantage Portfolio. |
(») | The Portfolio, at all times, maintains portfolio securities in sufficient amount to cover its obligations related to investments in forward currency contracts. |
Security Abbreviations: | |
ADR | — American Depositary Receipt |
GDR | — Global Depositary Receipt |
NVDR | — Non- Voting Depository Receipt |
PJSC | — Public Joint Stock Company |
REIT | — Real Estate Investment Trust |
Currency Abbreviations: | |||
AUD | — Australian Dollar | GBP | — British Pound Sterling |
CAD | — Canadian Dollar | HKD | — Hong Kong Dollar |
EUR | — Euro | USD | — United States Dollar |
Counterparty Abbreviations: | |||
BNP | — BNP Paribas SA | MEL | — The Bank of New York Mellon Corp. |
CAN | — Canadian Imperial | RBC | — Royal Bank of Canada |
Bank of Commerce | SCB | — Standard Chartered Bank | |
CIT | — Citibank NA | SSB | — State Street Bank and Trust Co. |
HSB | — HSBC Bank USA NA |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 127
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country:
Industry† | Lazard Developing Markets Equity Portfolio | Lazard Emerging Markets Core Equity Portfolio | Lazard Emerging Markets Equity Advantage Portfolio | Lazard Emerging Markets Equity Blend Portfolio | |||||||||||||
Common & Preferred Stocks | |||||||||||||||||
Aerospace & Defense | — | % | — | % | — | % | — | % | |||||||||
Air Freight & Logistics | 1.0 | — | — | 1.2 | |||||||||||||
Airlines | — | 0.9 | 1.1 | — | |||||||||||||
Auto Components | — | 0.6 | 0.5 | 1.1 | |||||||||||||
Automobiles | — | 1.0 | 1.1 | 0.9 | |||||||||||||
Banks | 25.7 | 21.8 | 16.8 | 25.0 | |||||||||||||
Beverages | 1.1 | 0.9 | 0.9 | 1.4 | |||||||||||||
Biotechnology | — | — | 0.4 | — | |||||||||||||
Building Products | — | — | 0.2 | — | |||||||||||||
Capital Markets | — | 1.0 | 1.5 | — | |||||||||||||
Chemicals | — | 4.3 | 1.3 | 0.6 | |||||||||||||
Commercial Services & Suppliers | 1.2 | — | 0.6 | 1.3 | |||||||||||||
Communications Equipment | — | — | — | — | |||||||||||||
Construction & Engineering | 1.9 | — | 0.9 | 1.2 | |||||||||||||
Construction Materials | 0.8 | 2.0 | 1.6 | 1.8 | |||||||||||||
Consumer Finance | 1.6 | — | 0.6 | 0.1 | |||||||||||||
Containers & Packaging | — | — | — | 0.2 | |||||||||||||
Diversified Consumer Services | 2.1 | 1.6 | 0.6 | 0.6 | |||||||||||||
Diversified Financial Services | — | 1.7 | 0.7 | 0.4 | |||||||||||||
Diversified Telecommunication Services | — | 2.1 | 2.9 | 1.0 | |||||||||||||
Electric Utilities | — | — | 0.4 | — | |||||||||||||
Electrical Equipment | 3.4 | — | — | 1.0 | |||||||||||||
Electronic Equipment, Instruments & Components | 1.8 | 0.9 | 0.9 | 2.5 | |||||||||||||
Energy Equipment & Services | — | 0.6 | — | — | |||||||||||||
Entertainment | 3.7 | 2.2 | 1.8 | 4.5 | |||||||||||||
Food & Staples Retailing | — | — | 2.1 | — | |||||||||||||
Food Products | — | 0.7 | 1.6 | 0.4 | |||||||||||||
Gas Utilities | 0.9 | — | 1.4 | 0.4 | |||||||||||||
Health Care Equipment & Supplies | — | — | 0.5 | 0.5 | |||||||||||||
Health Care Providers & Services | 3.8 | 0.5 | 0.2 | 1.4 | |||||||||||||
Hotels, Restaurants & Leisure | 0.7 | — | 0.9 | 1.0 | |||||||||||||
Household Durables | — | 0.6 | 0.2 | — | |||||||||||||
Household Products | — | — | 0.5 | 0.8 | |||||||||||||
Industrial Conglomerates | — | 0.9 | 0.9 | 0.9 | |||||||||||||
Insurance | 2.0 | 5.0 | 3.5 | 2.2 |
The accompanying notes are an integral part of these financial statements.
128 Semi-Annual Report
Lazard Emerging Markets Equity Portfolio | Lazard Equity Franchise Portfolio | Lazard Global Equity Select Portfolio | Lazard Global Listed Infrastructure Portfolio | Lazard Global Strategic Equity Portfolio | ||||||||||||||||
— | % | — | % | 1.2 | % | — | % | 5.2 | % | |||||||||||
0.1 | — | — | — | 1.1 | ||||||||||||||||
— | — | — | — | 0.5 | ||||||||||||||||
1.4 | — | — | — | — | ||||||||||||||||
3.3 | — | — | — | 0.9 | ||||||||||||||||
25.4 | — | 7.1 | — | 4.8 | ||||||||||||||||
1.1 | 4.7 | 8.6 | — | 5.7 | ||||||||||||||||
— | — | — | — | 1.2 | ||||||||||||||||
— | — | 0.8 | — | — | ||||||||||||||||
— | — | 4.6 | — | 7.2 | ||||||||||||||||
0.5 | — | 1.9 | — | 1.5 | ||||||||||||||||
— | 5.8 | — | — | — | ||||||||||||||||
— | — | 3.3 | — | — | ||||||||||||||||
— | — | — | 4.7 | — | ||||||||||||||||
3.2 | — | — | — | — | ||||||||||||||||
— | — | — | — | — | ||||||||||||||||
— | — | — | — | — | ||||||||||||||||
— | 4.7 | — | — | — | ||||||||||||||||
— | — | — | — | — | ||||||||||||||||
1.7 | — | — | — | — | ||||||||||||||||
— | 2.4 | — | 12.9 | — | ||||||||||||||||
— | — | 2.4 | — | — | ||||||||||||||||
2.0 | 4.6 | 1.1 | — | 0.8 | ||||||||||||||||
— | — | 0.8 | — | 0.9 | ||||||||||||||||
2.8 | — | 1.1 | — | 5.5 | ||||||||||||||||
1.9 | — | — | — | — | ||||||||||||||||
— | — | — | — | �� | ||||||||||||||||
0.9 | — | — | 7.3 | — | ||||||||||||||||
— | 3.4 | 2.3 | — | 6.0 | ||||||||||||||||
0.6 | 18.6 | — | — | 1.0 | ||||||||||||||||
— | 5.8 | 2.8 | — | — | ||||||||||||||||
1.0 | — | — | — | — | ||||||||||||||||
0.9 | — | 1.5 | — | — | ||||||||||||||||
1.8 | — | 2.0 | — | — | ||||||||||||||||
2.8 | — | 7.7 | — | 7.8 |
Semi-Annual Report 129
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country (continued):
Lazard | Lazard | ||||||||||||||||
Lazard | Lazard | Emerging | Emerging | ||||||||||||||
Developing | Emerging | Markets | Markets | ||||||||||||||
Markets | Markets | Equity | Equity | ||||||||||||||
Equity | Core Equity | Advantage | Blend | ||||||||||||||
Industry† | Portfolio | Portfolio | Portfolio | Portfolio | |||||||||||||
Interactive Media & Services | 10.4 | % | 7.0 | % | 5.0 | % | 4.6 | % | |||||||||
Internet & Direct Marketing Retail | 3.2 | 5.8 | 5.0 | 1.7 | |||||||||||||
IT Services | 1.6 | 1.3 | 2.7 | 3.6 | |||||||||||||
Leisure Products | — | — | — | — | |||||||||||||
Life Sciences Tools & Services | 0.5 | 0.4 | — | — | |||||||||||||
Machinery | 3.0 | 1.2 | 1.3 | 1.8 | |||||||||||||
Media | — | — | — | 0.4 | |||||||||||||
Metals & Mining | 2.8 | 4.5 | 4.0 | 1.2 | |||||||||||||
Multiline Retail | — | — | 0.7 | — | |||||||||||||
Multi-Utilities | — | — | — | — | |||||||||||||
Oil, Gas & Consumable Fuels | 9.1 | 6.8 | 7.6 | 7.1 | |||||||||||||
Paper & Forest Products | 0.8 | 1.4 | 0.1 | — | |||||||||||||
Personal Products | — | 1.8 | 0.6 | — | |||||||||||||
Pharmaceuticals | — | — | 1.4 | 0.8 | |||||||||||||
Professional Services | — | — | — | — | |||||||||||||
Real Estate Management & Development | — | 1.0 | 2.7 | 0.2 | |||||||||||||
Road & Rail | 1.3 | 1.2 | — | 0.3 | |||||||||||||
Semiconductors & Semiconductor Equipment | 4.9 | 6.7 | 5.9 | 5.9 | |||||||||||||
Software | — | — | 0.4 | — | |||||||||||||
Specialty Retail | 0.9 | — | 1.3 | 0.7 | |||||||||||||
Technology Hardware, Storage & Peripherals | 4.2 | 5.2 | 5.7 | 4.1 | |||||||||||||
Textiles, Apparel & Luxury Goods | 1.7 | 1.4 | 1.7 | 1.1 | |||||||||||||
Thrifts & Mortgage Finance | — | — | — | — | |||||||||||||
Tobacco | — | — | 0.6 | 0.6 | |||||||||||||
Trading Companies & Distributors | — | 0.6 | — | 0.4 | |||||||||||||
Transportation Infrastructure | — | 1.4 | 1.3 | 1.4 | |||||||||||||
Water Utilities | 1.8 | — | — | 1.5 | |||||||||||||
Wireless Telecommunication Services | — | 1.0 | 2.2 | 3.2 | |||||||||||||
Subtotal | 97.9 | 98.0 | 96.8 | 93.0 | |||||||||||||
Short-Term Investments | 2.4 | 1.4 | 1.8 | 6.0 | |||||||||||||
Total Investments | 100.3 | % | 99.4 | % | 98.6 | % | 99.0 | % |
† | Industry classifications may be different than those used for compliance monitoring purposes. |
The accompanying notes are an integral part of these financial statements.
130 Semi-Annual Report
Lazard Emerging Markets Equity Portfolio | Lazard Equity Franchise Portfolio | Lazard Global Equity Select Portfolio | Lazard Global Listed Infrastructure Portfolio | Lazard Global Strategic Equity Portfolio | ||||||||||||||||
0.8 | % | 1.0 | % | 3.8 | % | — | % | 5.7 | % | |||||||||||
— | — | 1.6 | — | 2.9 | ||||||||||||||||
4.9 | 2.0 | 5.0 | — | 8.9 | ||||||||||||||||
— | — | 1.2 | — | — | ||||||||||||||||
— | — | 5.5 | — | 3.1 | ||||||||||||||||
1.9 | — | 1.8 | — | 1.0 | ||||||||||||||||
— | 10.3 | — | 6.4 | 1.5 | ||||||||||||||||
2.7 | — | — | — | 1.0 | ||||||||||||||||
0.4 | — | 2.3 | — | 1.4 | ||||||||||||||||
— | 3.5 | — | 13.8 | — | ||||||||||||||||
11.3 | — | — | — | 2.2 | ||||||||||||||||
— | — | — | — | — | ||||||||||||||||
1.0 | — | 3.3 | — | 1.7 | ||||||||||||||||
— | — | 6.3 | — | 5.3 | ||||||||||||||||
— | 7.8 | 5.7 | — | 2.9 | ||||||||||||||||
— | — | 1.0 | — | — | ||||||||||||||||
— | — | 1.7 | 17.3 | 1.0 | ||||||||||||||||
6.2 | 2.1 | 1.9 | — | — | ||||||||||||||||
— | 4.2 | 3.0 | — | 4.7 | ||||||||||||||||
0.4 | 2.0 | 0.5 | — | — | ||||||||||||||||
5.5 | — | — | — | — | ||||||||||||||||
— | 7.8 | 0.4 | — | 1.0 | ||||||||||||||||
— | — | 0.5 | — | — | ||||||||||||||||
1.5 | — | — | — | — | ||||||||||||||||
— | — | 0.7 | — | 1.3 | ||||||||||||||||
1.5 | 3.0 | — | 18.6 | — | ||||||||||||||||
— | 3.3 | — | 11.2 | — | ||||||||||||||||
6.6 | — | — | — | — | ||||||||||||||||
96.1 | 97.0 | 95.4 | 92.2 | 95.7 | ||||||||||||||||
3.7 | 2.7 | 5.2 | 7.8 | 4.4 | ||||||||||||||||
99.8 | % | 99.7 | % | 100.6 | % | 100.0 | % | 100.1 | % |
Semi-Annual Report 131
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country (continued):
Industry† | Lazard International Quality Growth Portfolio | Lazard International Equity Advantage Portfolio | Lazard International Equity Concentrated Portfolio | Lazard International Equity Portfolio | |||||||||||||
Common & Preferred Stocks | |||||||||||||||||
Aerospace & Defense | 2.7 | % | 1.5 | % | 6.1 | % | 2.3 | % | |||||||||
Air Freight & Logistics | — | — | — | — | |||||||||||||
Airlines | — | 1.7 | — | 1.1 | |||||||||||||
Auto Components | — | 1.1 | — | 1.0 | |||||||||||||
Automobiles | — | 2.1 | 3.5 | 2.8 | |||||||||||||
Banks | 6.4 | 7.1 | 9.3 | 8.9 | |||||||||||||
Beverages | — | 0.3 | 7.2 | 5.5 | |||||||||||||
Biotechnology | 2.0 | 1.0 | — | — | |||||||||||||
Building Products | 4.9 | 0.4 | — | 2.2 | |||||||||||||
Capital Markets | 6.1 | 1.2 | — | — | |||||||||||||
Chemicals | 2.1 | 2.4 | — | 4.7 | |||||||||||||
Commercial Services & Suppliers | — | 0.1 | — | — | |||||||||||||
Communications Equipment | — | — | — | — | |||||||||||||
Construction & Engineering | — | 1.2 | — | 1.4 | |||||||||||||
Consumer Finance | — | 0.1 | — | — | |||||||||||||
Containers & Packaging | — | 0.2 | 2.6 | 1.2 | |||||||||||||
Distributors | — | — | — | — | |||||||||||||
Diversified Consumer Services | — | — | — | — | |||||||||||||
Diversified Financial Services | — | 1.4 | — | — | |||||||||||||
Diversified Telecommunication Services | — | 1.2 | — | 2.2 | |||||||||||||
Electric Utilities | — | 3.7 | — | 1.4 | |||||||||||||
Electrical Equipment | 2.1 | 0.2 | — | 0.8 | |||||||||||||
Electronic Equipment, Instruments & Components | 2.0 | 0.6 | 4.6 | 0.8 | |||||||||||||
Energy Equipment & Services | — | — | — | — | |||||||||||||
Equity Real Estate Investment Trusts (REITs) | — | 0.4 | — | — | |||||||||||||
Entertainment | 3.9 | 0.2 | 2.2 | 3.2 | |||||||||||||
Food & Staples Retailing | 2.4 | 1.7 | — | — | |||||||||||||
Food Products | 0.9 | 4.1 | — | — | |||||||||||||
Gas Utilities | — | — | — | — | |||||||||||||
Health Care Equipment & Supplies | 4.4 | 1.3 | 5.2 | 2.7 | |||||||||||||
Health Care Providers & Services | 2.1 | 0.7 | — | 0.7 | |||||||||||||
Health Care Technology | — | — | — | — | |||||||||||||
Hotels, Restaurants & Leisure | 2.2 | 1.7 | 3.5 | 1.5 | |||||||||||||
Household Durables | — | 0.2 | — | — | |||||||||||||
Household Products | 1.8 | — | — | — |
The accompanying notes are an integral part of these financial statements.
132 Semi-Annual Report
Lazard International Equity Select Portfolio | Lazard International Equity Value Portfolio | Lazard International Small Cap Equity Portfolio | Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | ||||||||||||||||
2.7 | % | 4.0 | % | — | % | 6.1 | % | 2.2 | % | |||||||||||
— | 3.9 | 2.0 | — | — | ||||||||||||||||
0.9 | 2.1 | — | 1.0 | 1.6 | ||||||||||||||||
1.2 | — | 1.3 | — | — | ||||||||||||||||
2.7 | 3.5 | — | 3.9 | — | ||||||||||||||||
10.0 | 11.2 | 1.1 | 8.5 | 2.7 | ||||||||||||||||
3.7 | 4.0 | 2.4 | 6.3 | 1.4 | ||||||||||||||||
0.6 | — | — | 1.2 | 1.5 | ||||||||||||||||
2.4 | 2.6 | 3.6 | 1.8 | — | ||||||||||||||||
— | 2.3 | 5.5 | 4.3 | 2.5 | ||||||||||||||||
1.0 | 3.5 | — | — | 0.2 | ||||||||||||||||
— | — | 2.5 | — | 2.8 | ||||||||||||||||
— | — | — | — | 0.7 | ||||||||||||||||
1.3 | — | — | — | 0.7 | ||||||||||||||||
— | — | — | 1.2 | 0.6 | ||||||||||||||||
— | — | — | — | — | ||||||||||||||||
— | — | — | — | 0.3 | ||||||||||||||||
— | — | 0.7 | — | — | ||||||||||||||||
— | — | 3.9 | 0.7 | 0.4 | ||||||||||||||||
2.5 | — | 2.2 | — | 2.5 | ||||||||||||||||
1.1 | — | — | — | 5.4 | ||||||||||||||||
0.2 | — | 0.8 | 0.9 | — | ||||||||||||||||
— | 4.5 | 6.1 | 1.5 | 1.2 | ||||||||||||||||
— | — | 1.0 | — | — | ||||||||||||||||
— | — | 1.0 | — | 4.4 | ||||||||||||||||
2.2 | 4.0 | 1.4 | 5.1 | — | ||||||||||||||||
— | 3.7 | 2.6 | — | 4.5 | ||||||||||||||||
— | — | 1.1 | — | 2.7 | ||||||||||||||||
— | — | — | — | 0.3 | ||||||||||||||||
3.5 | — | — | 3.1 | 0.8 | ||||||||||||||||
— | — | 1.9 | — | 1.6 | ||||||||||||||||
— | — | 1.1 | — | 0.3 | ||||||||||||||||
1.2 | 7.5 | 4.3 | 1.4 | 3.9 | ||||||||||||||||
— | 2.1 | 2.0 | — | — | ||||||||||||||||
— | — | — | — | 3.8 |
Semi-Annual Report 133
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country (concluded):
Industry† | Lazard International Quality Growth Portfolio | Lazard International Equity Advantage Portfolio | Lazard International Equity Concentrated Portfolio | Lazard International Equity Portfolio | |||||||||||||
Independent Power & Renewable Electricity Producers | — | % | — | % | — | % | — | % | |||||||||
Industrial Conglomerates | — | 0.9 | — | — | |||||||||||||
Insurance | 7.8 | 6.5 | 12.3 | 9.5 | |||||||||||||
Interactive Media & Services | 3.1 | 0.7 | 3.4 | — | |||||||||||||
Internet & Direct Marketing Retail | 1.9 | — | — | — | |||||||||||||
IT Services | — | 1.4 | 5.2 | 1.6 | |||||||||||||
Leisure Products | 1.2 | 0.2 | — | 0.9 | |||||||||||||
Life Sciences Tools & Services | 2.0 | — | — | — | |||||||||||||
Machinery | — | 4.9 | 2.7 | 3.1 | |||||||||||||
Media | — | 0.1 | — | 1.3 | |||||||||||||
Metals & Mining | — | 4.3 | — | 1.5 | |||||||||||||
Multiline Retail | 3.4 | — | — | 0.9 | |||||||||||||
Multi-Utilities | — | 0.5 | 2.0 | 1.3 | |||||||||||||
Oil, Gas & Consumable Fuels | — | 6.9 | 7.2 | 6.2 | |||||||||||||
Personal Products | — | 3.3 | — | 3.6 | |||||||||||||
Pharmaceuticals | 1.2 | 9.5 | 4.6 | 6.4 | |||||||||||||
Professional Services | 9.4 | 1.8 | — | 4.3 | |||||||||||||
Real Estate Management & Development | — | 3.8 | 2.6 | 2.8 | |||||||||||||
Road & Rail | 3.0 | 1.7 | — | 1.1 | |||||||||||||
Semiconductors & Semiconductor Equipment | 4.5 | 1.8 | — | — | |||||||||||||
Software | 5.0 | 1.8 | 4.8 | 3.6 | |||||||||||||
Specialty Retail | 2.4 | 1.2 | — | — | |||||||||||||
Technology Hardware, Storage & Peripherals | — | 0.5 | 3.5 | 1.2 | |||||||||||||
Textiles, Apparel & Luxury Goods | 1.3 | 3.1 | — | — | |||||||||||||
Thrifts & Mortgage Finance | — | — | — | — | |||||||||||||
Tobacco | — | 2.0 | — | — | |||||||||||||
Trading Companies & Distributors | 4.4 | 0.6 | — | 1.4 | |||||||||||||
Water Utilities | — | — | — | — | |||||||||||||
Wireless Telecommunication Services | — | 2.4 | 2.4 | 1.1 | |||||||||||||
Subtotal | 96.6 | 97.7 | 94.9 | 96.2 | |||||||||||||
Short-Term Investments | 3.8 | 2.6 | 4.4 | 3.6 | |||||||||||||
Total Investments | 100.4 | % | 100.3 | % | 99.3 | % | 99.8 | % |
† | Industry classifications may be different than those used for compliance monitoring purposes. |
The accompanying notes are an integral part of these financial statements.
134 Semi-Annual Report
Lazard International Equity Select Portfolio | Lazard International Equity Value Portfolio | Lazard International Small Cap Equity Portfolio | Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | ||||||||||||||||
— | % | — | % | — | % | — | % | 0.2 | % | |||||||||||
— | — | 1.3 | — | 1.5 | ||||||||||||||||
12.1 | 7.5 | — | 10.3 | 6.8 | ||||||||||||||||
2.6 | — | 4.4 | 0.7 | 0.3 | ||||||||||||||||
1.5 | — | — | 0.8 | 0.2 | ||||||||||||||||
3.0 | 7.3 | 4.6 | 3.1 | 3.0 | ||||||||||||||||
— | 3.5 | — | 1.0 | 0.3 | ||||||||||||||||
1.0 | — | 1.7 | — | 0.2 | ||||||||||||||||
2.2 | — | 5.2 | 4.1 | 0.3 | ||||||||||||||||
— | — | 2.2 | 2.5 | 1.0 | ||||||||||||||||
1.3 | 3.0 | 1.9 | 2.0 | 3.3 | ||||||||||||||||
0.9 | — | — | 0.9 | 0.2 | ||||||||||||||||
1.6 | 4.3 | — | 1.6 | 2.4 | ||||||||||||||||
6.2 | 3.8 | — | 3.4 | 1.7 | ||||||||||||||||
3.2 | — | — | 3.1 | 2.0 | ||||||||||||||||
5.1 | — | 3.9 | 5.4 | 8.6 | ||||||||||||||||
4.2 | 2.1 | 5.4 | 4.5 | 0.5 | ||||||||||||||||
1.4 | — | 8.3 | 1.8 | 2.4 | ||||||||||||||||
1.0 | — | — | — | 0.3 | ||||||||||||||||
1.2 | — | — | — | 0.8 | ||||||||||||||||
3.5 | — | 2.7 | — | 1.9 | ||||||||||||||||
0.5 | — | 2.2 | — | 3.2 | ||||||||||||||||
1.2 | — | — | — | 0.5 | ||||||||||||||||
0.8 | — | 1.8 | — | 1.9 | ||||||||||||||||
— | — | — | 1.2 | — | ||||||||||||||||
— | — | — | — | 1.0 | ||||||||||||||||
0.8 | — | 2.1 | 1.2 | 0.6 | ||||||||||||||||
0.8 | — | 0.9 | — | — | ||||||||||||||||
0.9 | 3.9 | — | 0.9 | 3.3 | ||||||||||||||||
94.2 | 94.3 | 97.1 | 95.5 | 97.4 | ||||||||||||||||
4.1 | 4.6 | 0.2 | 3.5 | 3.1 | ||||||||||||||||
98.3 | % | 98.9 | % | 97.3 | % | 99.0 | % | 100.5 | % |
Semi-Annual Report 135
The Lazard Funds, Inc.Statements of Assets and Liabilities (unaudited)
June 30, 2019 | Lazard Developing Markets Equity Portfolio | Lazard Emerging Markets Core Equity Portfolio | ||||||||
ASSETS | ||||||||||
Investments in securities, at fair value | $ | 242,155,760 | $ | 230,653,205 | ||||||
Cash | — | 39,100 | ||||||||
Foreign currency, at fair value | 142,282 | 493,203 | ||||||||
Receivables for: | ||||||||||
Dividends | 965,518 | 1,711,656 | ||||||||
Investments sold | 746,961 | 60,837 | ||||||||
Capital stock sold | 331,482 | 271,232 | ||||||||
Amount due from Investment Manager (Note 3) | — | — | ||||||||
Deferred offering costs (Note 2(f)) | — | 1,127 | ||||||||
Prepaid expenses | — | — | ||||||||
Total assets | 244,342,003 | 233,230,360 | ||||||||
LIABILITIES | ||||||||||
Payables for: | ||||||||||
Foreign capital gains taxes | 10,481 | 73,060 | ||||||||
Management fees | 199,059 | 187,322 | ||||||||
Accrued custodian fees | 13,220 | 21,349 | ||||||||
Accrued distribution fees | 1,840 | 442 | ||||||||
Accrued professional services | 39,924 | 39,669 | ||||||||
Capital stock redeemed | 936,901 | 107,812 | ||||||||
Investments purchased | 1,616,169 | 788,318 | ||||||||
Other accrued expenses and payables | 35,083 | 17,269 | ||||||||
Total liabilities | 2,852,677 | 1,235,241 | ||||||||
Net assets | $ | 241,489,326 | $ | 231,995,119 | ||||||
NET ASSETS | ||||||||||
Paid in capital | $ | 336,187,369 | $ | 219,531,055 | ||||||
Distributable earnings (Accumulated loss) | (94,698,043 | ) | 12,464,064 | |||||||
Net assets | $ | 241,489,326 | $ | 231,995,119 | ||||||
Institutional Shares | ||||||||||
Net assets | $ | 232,302,827 | $ | 229,253,991 | ||||||
Shares of capital stock outstanding* | 17,417,054 | 20,632,985 | ||||||||
Net asset value, offering and redemption price per share | $ | 13.34 | $ | 11.11 | ||||||
Open Shares | ||||||||||
Net assets | $ | 9,186,499 | $ | 2,208,635 | ||||||
Shares of capital stock outstanding* | 693,607 | 199,606 | ||||||||
Net asset value, offering and redemption price per share | $ | 13.24 | $ | 11.06 | ||||||
R6 Shares | ||||||||||
Net assets | — | $ | 532,493 | |||||||
Shares of capital stock outstanding* | — | 47,893 | ||||||||
Net asset value, offering and redemption price per share | — | $ | 11.12 | |||||||
Cost of investments in securities | $ | 221,831,542 | $ | 220,741,602 | ||||||
Cost of foreign currency | $ | 144,147 | $ | 492,169 |
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
The accompanying notes are an integral part of these financial statements.
136 Semi-Annual Report
Lazard Emerging Markets Equity Advantage Portfolio | Lazard Emerging Markets Equity Blend Portfolio | Lazard Emerging Markets Equity Portfolio | Lazard Equity Franchise Portfolio | Lazard Global Equity Select Portfolio | ||||||||||||||
$ | 9,959,412 | $ | 97,833,173 | $ | 8,330,966,196 | $ | 36,987,629 | $ | 71,979,957 | |||||||||
1,471 | 7,050 | 138,562 | — | — | ||||||||||||||
8,200 | 208,600 | 4,131,379 | 17 | 9,955 | ||||||||||||||
52,793 | 889,170 | 41,264,948 | 154,052 | 120,161 | ||||||||||||||
— | 122,287 | 9,613,833 | — | 104 | ||||||||||||||
102,075 | 43,821 | 8,176,515 | — | 73,039 | ||||||||||||||
7,032 | — | — | — | — | ||||||||||||||
— | — | — | — | — | ||||||||||||||
23,308 | 29,004 | — | 5,904 | — | ||||||||||||||
10,154,291 | 99,133,105 | 8,394,291,433 | 37,147,602 | 72,183,216 | ||||||||||||||
— | 73,503 | 13,647,259 | — | — | ||||||||||||||
— | 105,997 | 6,949,400 | 15,715 | 44,751 | ||||||||||||||
6,846 | 15,994 | 690,666 | 7,808 | 6,369 | ||||||||||||||
214 | 1,332 | 212,892 | 44 | 198 | ||||||||||||||
40,468 | 48,603 | 124,874 | 25,514 | 27,998 | ||||||||||||||
— | 65,467 | 21,797,692 | 3,086 | 62,271 | ||||||||||||||
6 | 33,057 | 566,018 | — | 500,589 | ||||||||||||||
6,484 | 16,528 | 687,866 | 12,671 | 5,018 | ||||||||||||||
54,018 | 360,481 | 44,676,667 | 64,838 | 647,194 | ||||||||||||||
$ | 10,100,273 | $ | 98,772,624 | $ | 8,349,614,766 | $ | 37,082,764 | $ | 71,536,022 | |||||||||
$ | 9,503,700 | $ | 148,831,550 | $ | 8,469,453,253 | $ | 37,395,751 | $ | 56,896,990 | |||||||||
596,573 | (50,058,926 | ) | (119,838,487 | ) | (312,987 | ) | 14,639,032 | |||||||||||
$ | 10,100,273 | $ | 98,772,624 | $ | 8,349,614,766 | $ | 37,082,764 | $ | 71,536,022 | |||||||||
$ | 8,956,279 | $ | 92,241,163 | $ | 7,134,435,562 | $ | 36,857,766 | $ | 70,530,734 | |||||||||
798,131 | 8,015,109 | 402,354,868 | 3,694,031 | 5,070,189 | ||||||||||||||
$ | 11.22 | $ | 11.51 | $ | 17.73 | $ | 9.98 | $ | 13.91 | |||||||||
$ | 1,143,994 | $ | 6,531,461 | $ | 1,034,364,858 | $ | 224,998 | $ | 1,005,288 | |||||||||
102,076 | 567,070 | 56,751,158 | 22,585 | 72,342 | ||||||||||||||
$ | 11.21 | $ | 11.52 | $ | 18.23 | $ | 9.96 | $ | 13.90 | |||||||||
— | — | $ | 180,814,346 | — | — | |||||||||||||
— | — | 10,198,673 | — | — | ||||||||||||||
— | — | $ | 17.73 | — | — | |||||||||||||
$ | 9,374,032 | $ | 96,407,909 | $ | 7,884,933,417 | $ | 37,858,698 | $ | 59,971,139 | |||||||||
$ | 8,188 | $ | 208,459 | $ | 4,086,369 | $ | 17 | $ | 9,952 | |||||||||
Semi-Annual Report 137
June 30, 2019 | Lazard Global Listed Infrastructure Portfolio | Lazard Global Strategic Equity Portfolio | ||||||||
ASSETS | ||||||||||
Investments in securities, at fair value | $ | 6,730,322,546 | $ | 3,081,364 | ||||||
Foreign currency, at fair value | — | 1,161 | ||||||||
Receivables for: | ||||||||||
Dividends | 44,888,553 | 5,633 | ||||||||
Investments sold | 473 | 22,557 | ||||||||
Capital stock sold | 17,951,634 | — | ||||||||
Amount due from Investment Manager (Note 3) | — | 10,722 | ||||||||
Deferred offering costs (Note 2(f)) | — | — | ||||||||
Prepaid expenses | — | 6,634 | ||||||||
Total assets | 6,793,163,206 | 3,128,071 | ||||||||
LIABILITIES | ||||||||||
Foreign currency due to custodian | 129,948 | — | ||||||||
Payables for: | ||||||||||
Foreign capital gains taxes | — | — | ||||||||
Management fees | 4,931,000 | — | ||||||||
Accrued custodian fees | 109,724 | 9,095 | ||||||||
Accrued distribution fees | 98,098 | 28 | ||||||||
Accrued professional services | 55,035 | 28,251 | ||||||||
Offering costs (Note 2(g)) | — | — | ||||||||
Capital stock redeemed | 2,064,245 | — | ||||||||
Investments purchased | 43,519,990 | 624 | ||||||||
Gross unrealized depreciation on forward currency contracts | 11,314,148 | — | ||||||||
Other accrued expenses and payables | 193,619 | 12,828 | ||||||||
Total liabilities | 62,415,807 | 50,826 | ||||||||
Net assets | $ | 6,730,747,399 | $ | 3,077,245 | ||||||
NET ASSETS | ||||||||||
Paid in capital | $ | 6,318,018,068 | $ | 2,555,598 | ||||||
Distributable earnings (Accumulated loss) | 412,729,331 | 521,647 | ||||||||
Net assets | $ | 6,730,747,399 | $ | 3,077,245 | ||||||
Institutional Shares | ||||||||||
Net assets | $ | 6,248,530,345 | $ | 2,934,561 | ||||||
Shares of capital stock outstanding* | 409,110,404 | 1,502,406 | ||||||||
Net asset value, offering and redemption price per share | $ | 15.27 | $ | 1.95 | ||||||
Open Shares | ||||||||||
Net assets | $ | 482,217,054 | $ | 142,684 | ||||||
Shares of capital stock outstanding* | 31,545,321 | 73,609 | ||||||||
Net asset value, offering and redemption price per share | $ | 15.29 | $ | 1.94 | ||||||
R6 Shares | ||||||||||
Net assets | — | — | ||||||||
Shares of capital stock outstanding | — | — | ||||||||
Net asset value, offering and redemption price per share | — | — | ||||||||
Cost of investments in securities | $ | 6,334,813,350 | $ | 2,608,866 | ||||||
Cost of foreign currency | $ | 129,740 | $ | 1,161 |
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
The accompanying notes are an integral part of these financial statements.
138 Semi-Annual Report
Lazard International Quality Growth Portfolio | Lazard International Equity Advantage Portfolio | Lazard International Equity Concentrated Portfolio | Lazard International Equity Portfolio | Lazard International Equity Select Portfolio | ||||||||||||||
$ | 3,636,274 | $ | 2,402,600 | $ | 86,943,309 | $ | 2,872,471,907 | $ | 91,349,527 | |||||||||
648 | 2,336 | 52,614 | 2,295,992 | 86,863 | ||||||||||||||
8,477 | 8,623 | 154,413 | 6,979,446 | 232,288 | ||||||||||||||
— | 11,176 | 645,011 | 9,537,824 | 507,226 | ||||||||||||||
— | — | 285,773 | 2,669,302 | 1,012,712 | ||||||||||||||
12,307 | 12,933 | — | — | — | ||||||||||||||
45,918 | — | — | — | — | ||||||||||||||
13,617 | 22,525 | — | — | 20,264 | ||||||||||||||
3,717,241 | 2,460,193 | 88,081,120 | 2,893,954,471 | 93,208,880 | ||||||||||||||
— | — | — | — | — | ||||||||||||||
— | — | — | — | — | ||||||||||||||
— | — | 50,728 | 1,733,895 | 55,638 | ||||||||||||||
11,365 | 9,432 | 5,081 | 104,765 | 5,893 | ||||||||||||||
— | 22 | 85 | 50,084 | 323 | ||||||||||||||
24,083 | 34,729 | 27,871 | 45,563 | 36,973 | ||||||||||||||
55,858 | — | — | — | — | ||||||||||||||
— | — | 4,585 | 2,543,622 | 45,020 | ||||||||||||||
— | 13,097 | 437,299 | 11,770,285 | 169,915 | ||||||||||||||
— | — | — | — | — | ||||||||||||||
3,612 | 6,535 | 10,545 | 222,072 | 12,196 | ||||||||||||||
94,918 | 63,815 | 536,194 | 16,470,286 | 325,958 | ||||||||||||||
$ | 3,622,323 | $ | 2,396,378 | $ | 87,544,926 | $ | 2,877,484,185 | $ | 92,882,922 | |||||||||
$ | 3,013,308 | $ | 2,412,086 | $ | 85,161,323 | $ | 2,590,423,203 | $ | 87,439,902 | |||||||||
609,015 | (15,708 | ) | 2,383,603 | 287,060,982 | 5,443,020 | |||||||||||||
$ | 3,622,323 | $ | 2,396,378 | $ | 87,544,926 | $ | 2,877,484,185 | $ | 92,882,922 | |||||||||
$ | 3,617,497 | $ | 2,288,781 | $ | 87,135,596 | $ | 2,501,284,425 | $ | 91,300,699 | |||||||||
300,724 | 235,905 | 8,853,550 | 138,067,509 | 8,688,118 | ||||||||||||||
$ | 12.03 | $ | 9.70 | $ | 9.84 | $ | 18.12 | $ | 10.51 | |||||||||
$ | 4,826 | $ | 107,597 | $ | 409,330 | $ | 259,583,370 | $ | 1,582,223 | |||||||||
402 | 11,106 | 41,581 | 14,173,935 | 150,078 | ||||||||||||||
$ | 12.00 | $ | 9.69 | $ | 9.84 | $ | 18.31 | $ | 10.54 | |||||||||
— | — | — | $ | 116,616,390 | — | |||||||||||||
— | — | — | 6,445,215 | — | ||||||||||||||
— | — | — | $ | 18.09 | — | |||||||||||||
$ | 3,058,795 | $ | 2,388,914 | $ | 83,716,564 | $ | 2,576,428,768 | $ | 86,773,009 | |||||||||
$ | 647 | $ | 2,337 | $ | 52,593 | $ | 2,296,220 | $ | 86,860 |
Semi-Annual Report 139
June 30, 2019 | Lazard International Equity Value Portfolio | Lazard International Small Cap Equity Portfolio | ||||||||
ASSETS | ||||||||||
Investments in securities, at fair value | $ | 24,973,955 | $ | 56,051,987 | ||||||
Foreign currency, at fair value | 4,595 | 17,406 | ||||||||
Receivables for: | ||||||||||
Dividends | 169,474 | 185,611 | ||||||||
Investments sold | 1,012,519 | 1,897,886 | ||||||||
Capital stock sold | 23 | 39,026 | ||||||||
Amount due from Investment Manager (Note 3) | 14,803 | — | ||||||||
Deferred offering costs (Note 2(f)) | 38,074 | — | ||||||||
Prepaid expenses | — | — | ||||||||
Total assets | 26,213,443 | 58,191,916 | ||||||||
LIABILITIES | ||||||||||
Due to custodian | — | 120,000 | ||||||||
Payables for: | ||||||||||
Foreign capital gains taxes | — | — | ||||||||
Management fees | — | 35,984 | ||||||||
Accrued custodian fees | 14,964 | 15,966 | ||||||||
Accrued distribution fees | 12 | 4,119 | ||||||||
Accrued administration fees | 2,751 | 3,452 | ||||||||
Accrued professional services | 24,822 | 39,903 | ||||||||
Capital stock redeemed | — | 954 | ||||||||
Investments purchased | 899,929 | 11,013 | ||||||||
Line of credit outstanding | — | 360,000 | ||||||||
Other accrued expenses and payables | 10,898 | 3,960 | ||||||||
Total liabilities | 953,376 | 595,351 | ||||||||
Net assets | $ | 25,260,067 | $ | 57,596,565 | ||||||
NET ASSETS | ||||||||||
Paid in capital | $ | 25,430,112 | $ | 55,475,426 | ||||||
Distributable earnings (Accumulated loss) | (170,045 | ) | 2,121,139 | |||||||
Net assets | $ | 25,260,067 | $ | 57,596,565 | ||||||
Institutional Shares | ||||||||||
Net assets | $ | 25,188,081 | $ | 37,672,092 | ||||||
Shares of capital stock outstanding* | 2,537,017 | 3,313,493 | ||||||||
Net asset value, offering and redemption price per share | $ | 9.93 | $ | 11.37 | ||||||
Open Shares | ||||||||||
Net assets | $ | 71,986 | $ | 19,924,473 | ||||||
Shares of capital stock outstanding* | 7,266 | 1,750,485 | ||||||||
Net asset value, offering and redemption price per share | $ | 9.91 | $ | 11.38 | ||||||
R6 Shares | ||||||||||
Net assets | — | — | ||||||||
Shares of capital stock outstanding* | — | — | ||||||||
Net asset value, offering and redemption price per share | — | — | ||||||||
Cost of investments in securities | $ | 25,273,601 | $ | 53,912,384 | ||||||
Cost of foreign currency | $ | 4,602 | $ | 17,703 |
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
The accompanying notes are an integral part of these financial statements.
140 Semi-Annual Report
Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | Lazard US Equity Concentrated Portfolio | Lazard US Equity Select Portfolio | Lazard US Realty Equity Portfolio | |||||||||||||||
$ | 6,342,770,169 | $ | 25,542,847 | $ | 1,287,328,312 | $ | 78,904,328 | $ | 65,574,698 | ||||||||||
7,364,653 | 6,857 | — | — | — | |||||||||||||||
12,648,446 | 48,316 | 1,382,200 | 46,092 | 225,822 | |||||||||||||||
60,012,831 | 416,962 | 3,469,332 | — | 744,039 | |||||||||||||||
8,206,984 | — | 866,796 | 34,411 | 4,480 | |||||||||||||||
— | 117 | — | — | — | |||||||||||||||
— | — | — | — | — | |||||||||||||||
— | 21,361 | — | 9,150 | — | |||||||||||||||
6,431,003,083 | 26,036,460 | 1,293,046,640 | 78,993,981 | 66,549,039 | |||||||||||||||
— | — | — | — | — | |||||||||||||||
848,582 | — | — | — | — | |||||||||||||||
3,878,947 | — | 739,638 | 32,960 | 40,621 | |||||||||||||||
166,076 | 8,316 | 27,922 | 8,451 | 5,990 | |||||||||||||||
181,386 | 47 | 9,630 | 207 | 9,572 | |||||||||||||||
98,810 | 2,761 | 27,758 | 4,383 | 3,613 | |||||||||||||||
69,569 | 31,610 | 30,672 | 23,998 | 31,591 | |||||||||||||||
5,033,567 | 7,277 | 518,936 | 107 | 18,493 | |||||||||||||||
16,640,841 | 576,080 | — | — | 756,770 | |||||||||||||||
— | — | — | — | — | |||||||||||||||
329,489 | 4,323 | 48,893 | 9,774 | 13,355 | |||||||||||||||
27,247,267 | 630,414 | 1,403,449 | 79,880 | 880,005 | |||||||||||||||
$ | 6,403,755,816 | $ | 25,406,046 | $ | 1,291,643,191 | $ | 78,914,101 | $ | 65,669,034 | ||||||||||
$ | 5,562,139,122 | $ | 23,660,740 | $ | 1,095,001,296 | $ | 62,941,995 | $ | 53,274,830 | ||||||||||
841,616,694 | 1,745,306 | 196,641,895 | 15,972,106 | 12,394,204 | |||||||||||||||
$ | 6,403,755,816 | $ | 25,406,046 | $ | 1,291,643,191 | $ | 78,914,101 | $ | 65,669,034 | ||||||||||
$ | 5,402,313,637 | $ | 25,195,294 | $ | 1,243,345,250 | $ | 66,443,997 | $ | 20,350,569 | ||||||||||
362,952,189 | 2,076,355 | 79,303,896 | 5,475,646 | 1,011,029 | |||||||||||||||
$ | 14.88 | $ | 12.13 | $ | 15.68 | $ | 12.13 | $ | 20.13 | ||||||||||
$ | 894,399,936 | $ | 210,752 | $ | 46,039,140 | $ | 1,020,243 | $ | 45,318,465 | ||||||||||
59,624,441 | 17,404 | 2,917,813 | 83,815 | 2,243,617 | |||||||||||||||
$ | 15.00 | $ | 12.11 | $ | 15.78 | $ | 12.17 | $ | 20.20 | ||||||||||
$ | 107,042,243 | — | $ | 2,258,801 | $ | 11,449,861 | — | ||||||||||||
7,185,379 | — | 143,723 | 943,270 | — | |||||||||||||||
$ | 14.90 | — | $ | 15.72 | $ | 12.14 | — | ||||||||||||
$ | 5,538,415,103 | $ | 23,975,017 | $ | 1,090,007,758 | $ | 65,507,840 | $ | 55,727,596 | ||||||||||
$ | 7,363,647 | $ | 6,860 | $ | — | $ | — | $ | — |
Semi-Annual Report 141
June 30, 2019 | Lazard US Small-Mid Cap Equity Portfolio | |||
ASSETS | ||||
Investments in securities, at fair value | $ | 82,339,363 | ||
Cash | 3,509,339 | |||
Receivables for: | ||||
Dividends | 136,510 | |||
Investments sold | 64,660,098 | |||
Capital stock sold | 465,524 | |||
Total assets | 151,110,834 | |||
LIABILITIES | ||||
Payables for: | ||||
Management fees | 90,757 | |||
Accrued distribution fees | 2,925 | |||
Capital stock redeemed | 65,218,179 | |||
Other accrued expenses and payables | 46,360 | |||
Total liabilities | 65,358,221 | |||
Net assets | $ | 85,752,613 | ||
NET ASSETS | ||||
Paid in capital | $ | 71,078,630 | ||
Distributable earnings (Accumulated loss) | 14,673,983 | |||
Net assets | $ | 85,752,613 | ||
Institutional Shares | ||||
Net assets | $ | 71,356,152 | ||
Shares of capital stock outstanding* | 5,421,169 | |||
Net asset value, offering and redemption price per share | $ | 13.16 | ||
Open Shares | ||||
Net assets | $ | 14,396,461 | ||
Shares of capital stock outstanding* | 1,183,422 | |||
Net asset value, offering and redemption price per share | $ | 12.17 | ||
Cost of investments in securities | $ | 75,631,067 |
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
The accompanying notes are an integral part of these financial statements.
142 Semi-Annual Report
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Semi-Annual Report 143
The Lazard Funds, Inc.Statements of Operations (unaudited)
Lazard | Lazard Emerging | ||||||||||
Developing Markets | Markets Core | ||||||||||
For the Six Months Ended June 30, 2019 | Equity Portfolio | Equity Portfolio | |||||||||
Investment Income (Loss) | |||||||||||
Income | |||||||||||
Dividends*, (a) | $ | 2,396,735 | $ | 3,747,824 | |||||||
Expenses | |||||||||||
Management fees (Note 3) | 1,260,127 | 1,169,424 | |||||||||
Custodian fees | 66,181 | 74,358 | |||||||||
Distribution fees (Open Shares) | 10,925 | 2,556 | |||||||||
Administration fees | 23,115 | 23,469 | |||||||||
Shareholders’ reports | 14,818 | 10,853 | |||||||||
Shareholders’ services | 9,968 | 7,757 | |||||||||
Professional services | 29,994 | 28,683 | |||||||||
Directors’ fees and expenses | 7,618 | 7,376 | |||||||||
Registration fees | 22,848 | 30,641 | |||||||||
Amortization of offering costs (Note 2(g)) | — | 1,602 | |||||||||
Other^ | 7,312 | 6,287 | |||||||||
Total gross expenses | 1,452,906 | 1,363,006 | |||||||||
Management fees waived and expenses reimbursed | — | (2,939 | ) | ||||||||
Total net expenses | 1,452,906 | 1,360,067 | |||||||||
Net investment income (loss) | 943,829 | 2,387,757 | |||||||||
Net Realized and Unrealized Gain (Loss) on Investments and Foreign Currency Transactions | |||||||||||
Net realized gain (loss) on: | |||||||||||
Investments**, (a), # | 11,448,214 | 4,249,257 | |||||||||
Foreign currency transactions | (125,669 | ) | 8,285 | ||||||||
Total net realized gain (loss) on investments and foreign currency transactions | 11,322,545 | 4,257,542 | |||||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||||
Investments†, (a) | 26,378,558 | 19,332,476 | |||||||||
Foreign currency translations | 18,726 | 1,381 | |||||||||
Total net change in unrealized appreciation (depreciation) on investments foreign currency translations and forward currency contracts | 26,397,284 | 19,333,857 | |||||||||
Net realized and unrealized gain (loss) on investments and foreign currency transactions | 37,719,829 | 23,591,399 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 38,663,658 | $ | 25,979,156 | |||||||
* | Net of foreign withholding taxes of | $ | 225,592 | $ | 424,200 | ||||||
** | Net of foreign capital gains taxes of | $ | 2,038 | $ | — | ||||||
† | Includes net change in unrealized appreciation (depreciation) of foreign capital gains taxes of | $ | (10,481 | ) | $ | (73,060 | ) | ||||
^ | Includes interest on line of credit of | $ | 1,292 | $ | 122 | ||||||
(a) | See Note 5 for information on affiliated issuers. | ||||||||||
# | On April 24, 2019, the Global Equity Select Portfolio had redemptions-in-kind with total proceeds in the amount of $7,186,378. The loss on associated investments of $1,760,136 will not be realized for tax purposes. |
The accompanying notes are an integral part of these financial statements.
144 Semi-Annual Report
Lazard | ||||||||||||||||||||||||
Emerging Markets | Lazard Emerging | Lazard | Lazard | Lazard Global | ||||||||||||||||||||
Equity Advantage | Markets Equity | Emerging Markets | Equity Franchise | Equity Select | ||||||||||||||||||||
Portfolio | Blend Portfolio | Equity Portfolio | Portfolio | Portfolio | ||||||||||||||||||||
$ | 132,270 | $ | 3,468,056 | $ | 157,419,423 | $ | 434,520 | $ | 828,521 | |||||||||||||||
33,501 | 1,451,012 | 45,186,060 | 71,509 | 281,183 | ||||||||||||||||||||
36,142 | 92,381 | 1,933,795 | 20,395 | 25,204 | ||||||||||||||||||||
1,122 | 8,283 | 1,321,693 | 269 | 1,078 | ||||||||||||||||||||
7,856 | 25,501 | 412,490 | 8,480 | 11,757 | ||||||||||||||||||||
2,067 | 22,328 | 356,411 | 1,951 | 2,561 | ||||||||||||||||||||
3,106 | 9,569 | 220,158 | 2,735 | 3,290 | ||||||||||||||||||||
24,198 | 35,546 | 211,742 | 19,278 | 21,354 | ||||||||||||||||||||
2,558 | 9,394 | 207,974 | 2,672 | 3,973 | ||||||||||||||||||||
16,744 | 23,215 | 86,728 | 17,159 | 22,569 | ||||||||||||||||||||
— | — | — | — | — | ||||||||||||||||||||
2,672 | 7,428 | 149,644 | 2,769 | 3,528 | ||||||||||||||||||||
129,966 | 1,684,657 | 50,086,695 | 147,217 | 376,497 | ||||||||||||||||||||
(85,257 | ) | — | — | (61,970 | ) | (5,995 | ) | |||||||||||||||||
44,709 | 1,684,657 | 50,086,695 | 85,247 | 370,502 | ||||||||||||||||||||
87,561 | 1,783,399 | 107,332,728 | 349,273 | 458,019 | ||||||||||||||||||||
(5,563 | ) | 4,178,561 | 110,894,231 | 216,879 | 2,571,812 | |||||||||||||||||||
(1,802 | ) | (151,562 | ) | (2,435,488 | ) | 1,307 | (7,241 | ) | ||||||||||||||||
(7,365 | ) | 4,026,999 | 108,458,743 | 218,186 | 2,564,571 | |||||||||||||||||||
461,128 | 28,579,260 | 675,451,500 | 214,058 | 9,177,603 | ||||||||||||||||||||
119 | 5,442 | 426,083 | 227 | 358 | ||||||||||||||||||||
461,247 | 28,584,702 | 675,877,583 | 214,285 | 9,177,961 | ||||||||||||||||||||
453,882 | 32,611,701 | 784,336,326 | 432,471 | 11,742,532 | ||||||||||||||||||||
$ | 541,442 | $ | 34,395,100 | $ | 891,669,054 | $ | 781,743 | $ | 12,200,551 | |||||||||||||||
$ | 18,184 | $ | 439,692 | $ | 22,899,162 | $ | 25,481 | $ | 59,370 | |||||||||||||||
$ | — | $ | 493,865 | $ | 11,868,811 | $ | — | $ | — | |||||||||||||||
$ | — | $ | 313,707 | $ | 23,971,108 | $ | — | $ | — | |||||||||||||||
$ | — | $ | — | $ | — | $ | 41 | $ | — |
Semi-Annual Report 145
Lazard | |||||||||||
Global Listed | Lazard | ||||||||||
Infrastructure | Global Strategic | ||||||||||
For the Six Months Ended June 30, 2019 | Portfolio | Equity Portfolio | |||||||||
Investment Income (Loss) | |||||||||||
Income | |||||||||||
Dividends* | $ | 153,470,647 | $ | 27,831 | |||||||
Expenses | |||||||||||
Management fees (Note 3) | 27,481,063 | 10,843 | |||||||||
Custodian fees | 438,179 | 22,239 | |||||||||
Distribution fees (Open Shares) | 578,640 | 174 | |||||||||
Administration fees | 293,790 | 7,544 | |||||||||
Shareholders’ reports | 111,358 | 2,036 | |||||||||
Shareholders’ services | 128,561 | 2,739 | |||||||||
Professional services | 121,142 | 20,371 | |||||||||
Directors’ fees and expenses | 126,999 | 2,539 | |||||||||
Registration fees | 59,650 | 19,476 | |||||||||
Amortization of offering costs (Note 2(f)) | — | — | |||||||||
Other^ | 81,191 | 2,661 | |||||||||
Total gross expenses | 29,420,573 | 90,622 | |||||||||
Management fees waived and expenses reimbursed | — | (75,951 | ) | ||||||||
Shareholders’ services fees waived | — | — | |||||||||
Total net expenses | 29,420,573 | 14,671 | |||||||||
Net investment income (loss) | 124,050,074 | 13,160 | |||||||||
Net Realized and Unrealized Gain (Loss) on Investments, Foreign Currency Transactions and Forward Currency Contracts | |||||||||||
Net realized gain (loss) on: | |||||||||||
Investments# | (119,606,660 | ) | 60,251 | ||||||||
Foreign currency transactions | 114,720 | (534 | ) | ||||||||
Forward currency contracts | 97,690,745 | — | |||||||||
Total net realized gain (loss) on investments, foreign currency transactions and forward currency contracts | (21,801,195 | ) | 59,717 | ||||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||||
Investments | 714,351,506 | 432,545 | |||||||||
Foreign currency translations | 168,842 | 53 | |||||||||
Forward currency contracts | (12,249,877 | ) | — | ||||||||
Total net change in unrealized appreciation (depreciation) on investments, foreign currency translations and forward currency contracts | 702,270,471 | 432,598 | |||||||||
Net realized and unrealized gain (loss) on investments, foreign currency transactions and forward currency contracts | 680,469,276 | 492,315 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 804,519,350 | $ | 505,475 | |||||||
* | Net of foreign withholding taxes of | $ | 13,967,442 | $ | 2,286 | ||||||
^ | Includes interest on line of credit of | $ | — | $ | — | ||||||
# | On April 24, 2019, the Global Listed Infrastructure Portfolio had redemptions-in-kind with total proceeds in the amount of $7,089,596. The loss on associated investments of $315,565 will not be realized for tax purposes. |
The accompanying notes are an integral part of these financial statements.
146 Semi-Annual Report
Lazard | Lazard | |||||||||||||||||||||||
Lazard | International | International | Lazard | Lazard | ||||||||||||||||||||
International | Equity | Equity | International | International | ||||||||||||||||||||
Quality Growth | Advantage | Concentrated | Equity | Equity Select | ||||||||||||||||||||
Portfolio | Portfolio | Portfolio | Portfolio | Portfolio | ||||||||||||||||||||
$ | 37,129 | $ | 49,983 | $ | 1,722,873 | $ | 57,850,116 | $ | 1,723,581 | |||||||||||||||
12,115 | 7,523 | 276,491 | 10,078,279 | 328,504 | ||||||||||||||||||||
23,803 | 31,834 | 24,064 | 278,440 | 31,778 | ||||||||||||||||||||
8 | 130 | 538 | 294,946 | 2,076 | ||||||||||||||||||||
7,565 | 7,508 | 11,683 | 155,625 | 12,838 | ||||||||||||||||||||
1,488 | 2,024 | 2,650 | 133,545 | 6,004 | ||||||||||||||||||||
8,880 | 2,701 | 2,979 | 70,956 | 3,872 | ||||||||||||||||||||
20,040 | 22,540 | 21,084 | 67,880 | 26,243 | ||||||||||||||||||||
2,543 | 2,530 | 3,683 | 59,042 | 4,105 | ||||||||||||||||||||
2,480 | 16,744 | 21,519 | 48,571 | 20,690 | ||||||||||||||||||||
27,698 | — | — | — | — | ||||||||||||||||||||
757 | 2,653 | 3,467 | 43,932 | 3,625 | ||||||||||||||||||||
107,377 | 96,187 | 368,158 | 11,231,216 | 439,735 | ||||||||||||||||||||
(87,532 | ) | (85,609 | ) | (39,024 | ) | (8,297 | ) | (612 | ) | |||||||||||||||
(6,107 | ) | — | — | — | — | |||||||||||||||||||
13,738 | 10,578 | 329,134 | 11,222,919 | 439,123 | ||||||||||||||||||||
23,391 | 39,405 | 1,393,739 | 46,627,197 | 1,284,458 | ||||||||||||||||||||
9,903 | (33,211 | ) | 467,462 | (8,963,816 | ) | 468,755 | ||||||||||||||||||
(1,816 | ) | 399 | (19,829 | ) | 183,002 | (10,875 | ) | |||||||||||||||||
— | — | — | — | — | ||||||||||||||||||||
8,087 | (32,812 | ) | 447,633 | (8,780,814 | ) | 457,880 | ||||||||||||||||||
577,774 | 241,647 | 8,972,520 | 345,519,027 | 10,279,428 | ||||||||||||||||||||
58 | 76 | (700 | ) | (31,457 | ) | 2,481 | ||||||||||||||||||
— | — | — | — | — | ||||||||||||||||||||
577,832 | 241,723 | 8,971,820 | 345,487,570 | 10,281,909 | ||||||||||||||||||||
585,919 | 208,911 | 9,419,453 | 336,706,756 | 10,739,789 | ||||||||||||||||||||
$ | 609,310 | $ | 248,316 | $ | 10,813,192 | $ | 383,333,953 | $ | 12,024,247 | |||||||||||||||
$ | 5,178 | $ | 6,473 | $ | 151,103 | $ | 6,623,312 | $ | 217,292 | |||||||||||||||
$ | — | $ | — | $ | 32 | $ | — | $ | — |
Semi-Annual Report 147
For the Six Months Ended June 30, 2019 | Lazard International Equity Value Portfolio | Lazard International Small Cap Equity Portfolio | |||||||||
Investment Income (Loss) | |||||||||||
Income | |||||||||||
Dividends* | $ | 678,367 | $ | 917,431 | |||||||
Expenses | |||||||||||
Management fees (Note 3) | 98,676 | 219,455 | |||||||||
Custodian fees | 27,373 | 35,950 | |||||||||
Distribution fees (Open Shares) | 77 | 25,447 | |||||||||
Administration fees | 8,905 | 11,021 | |||||||||
Shareholders’ reports | 2,125 | 5,352 | |||||||||
Shareholders’ services | 12,898 | 4,737 | |||||||||
Professional services | 19,792 | 26,045 | |||||||||
Directors’ fees and expenses | 3,008 | 3,727 | |||||||||
Registration fees | 17,159 | 18,176 | |||||||||
Amortization of offering costs (Note 2(f)) | 53,729 | — | |||||||||
Other^ | 2,878 | 3,534 | |||||||||
Total gross expenses | 246,620 | 353,444 | |||||||||
Management fees waived and expenses reimbursed | (119,144 | ) | — | ||||||||
Shareholders’ services fees waived | (10,167 | ) | — | ||||||||
Total net expenses | 117,309 | 353,444 | |||||||||
Net investment income (loss) | 561,058 | 563,987 | |||||||||
Net Realized and Unrealized Gain (Loss) on Investments and foreign currency transactions | |||||||||||
Net realized gain (loss) on: | |||||||||||
Investments**, # | 262,515 | (1,510,401 | ) | ||||||||
Foreign currency transactions | (1,894 | ) | 1,018 | ||||||||
Total net realized gain (loss) on investments and foreign currency transactions | 260,621 | (1,509,383 | ) | ||||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||||
Investments† | 1,163,082 | 8,591,268 | |||||||||
Foreign currency translations | 1,255 | 809 | |||||||||
Total net change in unrealized appreciation (depreciation) on investments, foreign currency translations and forward currency contracts | 1,164,337 | 8,592,077 | |||||||||
Net realized and unrealized gain (loss) on investments and foreign currency transactions | 1,424,958 | 7,082,694 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 1,986,016 | $ | 7,646,681 | |||||||
* | Net of foreign withholding taxes of | $ | 52,643 | $ | 98,079 | ||||||
** | Net of foreign capital gains taxes of | $ | — | $ | 294 | ||||||
† | Includes net change in unrealized appreciation (depreciation) of foreign capital gains taxes of | $ | — | $ | — | ||||||
^ | Includes interest on line of credit of | $ | — | $ | 39 |
# | On April 24, 2019, the International Strategic Equity and US Equity Concentrated Portfolios had redemptions-in-kind with total proceeds in the amount of $5,840,598 and 14,745,759, respectively. The loss on associated investments of $878,071 and 2,551,597 will not be realized for tax purposes. |
The accompanying notes are an integral part of these financial statements.
148 Semi-Annual Report
Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | Lazard US Equity Concentrated Portfolio | Lazard US Equity Select Portfolio | Lazard US Realty Equity Portfolio | ||||||||||||||||||||
$ | 108,143,034 | $ | 326,218 | $ | 9,827,254 | $ | 718,785 | $ | 1,120,913 | |||||||||||||||
22,910,565 | 70,047 | 4,335,426 | 250,844 | 244,236 | ||||||||||||||||||||
555,051 | 34,674 | 89,609 | 24,897 | 16,545 | ||||||||||||||||||||
1,093,814 | 250 | 59,107 | 1,211 | 58,508 | ||||||||||||||||||||
295,381 | 8,822 | 83,183 | 13,675 | 11,434 | ||||||||||||||||||||
168,278 | 2,112 | 35,972 | 3,787 | 7,287 | ||||||||||||||||||||
132,814 | 2,840 | 37,387 | 5,401 | 5,386 | ||||||||||||||||||||
127,371 | 21,810 | 40,008 | 20,224 | 20,827 | ||||||||||||||||||||
131,144 | 2,945 | 29,047 | 4,087 | 3,873 | ||||||||||||||||||||
53,927 | 17,883 | 34,408 | 20,842 | 18,846 | ||||||||||||||||||||
— | — | — | — | — | ||||||||||||||||||||
90,891 | 2,876 | 21,847 | 4,041 | 3,791 | ||||||||||||||||||||
25,559,236 | 164,259 | 4,765,994 | 349,009 | 390,733 | ||||||||||||||||||||
(2,537 | ) | (76,352 | ) | (1,274 | ) | (57,946 | ) | (2,277 | ) | |||||||||||||||
— | — | — | — | — | ||||||||||||||||||||
25,556,699 | 87,907 | 4,764,720 | 291,063 | 388,456 | ||||||||||||||||||||
82,586,335 | 238,311 | 5,062,534 | 427,722 | 732,457 | ||||||||||||||||||||
(33,066,847 | ) | 292,089 | 11,709,180 | 2,438,347 | 727,327 | |||||||||||||||||||
(521,356 | ) | (3,500 | ) | — | — | — | ||||||||||||||||||
(33,588,203 | ) | 288,589 | 11,709,180 | 2,438,347 | 727,327 | |||||||||||||||||||
815,466,557 | 2,643,588 | 222,815,977 | 10,145,581 | 10,496,157 | ||||||||||||||||||||
41,826 | 792 | — | — | — | ||||||||||||||||||||
815,508,383 | 2,644,380 | 222,815,977 | 10,145,581 | 10,496,157 | ||||||||||||||||||||
781,920,180 | 2,932,969 | 234,525,157 | 12,583,928 | 11,223,484 | ||||||||||||||||||||
$ | 864,506,515 | $ | 3,171,280 | $ | 239,587,691 | $ | 13,011,650 | $ | 11,955,941 | |||||||||||||||
$ | 11,077,879 | $ | 25,863 | $ | — | $ | — | $ | — | |||||||||||||||
$ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||
$ | (806,734 | ) | $ | — | $ | — | $ | — | $ | — | ||||||||||||||
$ | — | $ | — | $ | — | $ | 25 | $ | 205 |
Semi-Annual Report 149
For the Six Months Ended June 30, 2019 | Lazard US Small-Mid Cap Equity Portfolio | ||||
Investment Income (Loss) | |||||
Income | |||||
Dividends | $ | 999,317 | |||
Expenses | |||||
Management fees (Note 3) | 533,044 | ||||
Custodian fees | 27,483 | ||||
Distribution fees (Open Shares) | 17,967 | ||||
Administration fees | 16,247 | ||||
Shareholders’ reports | 6,930 | ||||
Shareholders’ services | 5,682 | ||||
Professional services | 21,211 | ||||
Directors’ fees and expenses | 5,332 | ||||
Other | 23,468 | ||||
Total net expenses | 657,364 | ||||
Net investment income (loss) | 341,953 | ||||
Net Realized and Unrealized Gain (Loss) on Investments | |||||
Net realized gain (loss) on Investments | 10,495,539 | ||||
Net change in unrealized appreciation (depreciation) on investments | 16,239,672 | ||||
Net realized and unrealized gain (loss) on investments | 26,735,211 | ||||
Net increase (decrease) in net assets resulting from operations | $ | 27,077,164 |
The accompanying notes are an integral part of these financial statements.
150 Semi-Annual Report
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Semi-Annual Report 151
The Lazard Funds, Inc.Statements of Changes in Net Assets
Lazard Developing Markets Equity Portfolio | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2019 | December 31, | ||||||||
(unaudited) | 2018 | ||||||||
Increase (Decrease) in Net Assets | |||||||||
Operations | |||||||||
Net investment income (loss) | $ | 943,829 | $ | 2,230,118 | |||||
Net realized gain (loss) on investments and foreign currency transactions | 11,322,545 | 11,062,804 | |||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 26,397,284 | (76,316,938 | ) | ||||||
Net increase (decrease) in net assets resulting from operations | 38,663,658 | (63,024,016 | ) | ||||||
Distributions to shareholders (Note 2(e)) | |||||||||
Institutional Shares | — | (1,769,297 | ) | ||||||
Open Shares | — | (72,262 | ) | ||||||
R6 Shares | — | — | |||||||
Return of capital | |||||||||
Institutional Shares | — | — | |||||||
Open Shares | — | — | |||||||
Net decrease in net assets resulting from distributions | — | (1,841,559 | ) | ||||||
Capital stock transactions | |||||||||
Net proceeds from sales | |||||||||
Institutional Shares | 42,398,789 | 109,622,584 | |||||||
Open Shares | 2,617,621 | 4,292,325 | |||||||
R6 Shares | — | — | |||||||
Net proceeds from reinvestment of distributions | |||||||||
Institutional Shares | — | 1,162,422 | |||||||
Open Shares | — | 69,269 | |||||||
R6 Shares | — | — | |||||||
Cost of shares redeemed | |||||||||
Institutional Shares | (62,634,884 | ) | (102,082,155 | ) | |||||
Open Shares | (1,938,494 | ) | (7,115,548 | ) | |||||
R6 Shares | — | — | |||||||
Net increase (decrease) in net assets from capital stock transactions | (19,556,968 | ) | 5,948,897 | ||||||
Total increase (decrease) in net assets | 19,106,690 | (58,916,678 | ) | ||||||
Net assets at beginning of period | 222,382,636 | 281,299,314 | |||||||
Net assets at end of period | $ | 241,489,326 | $ | 222,382,636 |
The accompanying notes are an integral part of these financial statements.
152 Semi-Annual Report
Lazard Emerging Markets Core Equity Portfolio | Lazard Emerging Markets Equity Advantage Portfolio | ||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | ||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | ||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | ||||||||||||
$ | 2,387,757 | $ | 3,782,203 | $ | 87,561 | $ | 67,358 | ||||||||
4,257,542 | 8,124,073 | (7,365 | ) | 168,585 | |||||||||||
19,333,857 | (67,542,603 | ) | 461,247 | (998,827 | ) | ||||||||||
25,979,156 | (55,636,327 | ) | 541,443 | (762,884 | ) | ||||||||||
— | (3,760,098 | ) | — | (69,604 | ) | ||||||||||
— | (23,933 | ) | — | (9,266 | ) | ||||||||||
— | (6,411 | ) | — | — | |||||||||||
— | — | — | (4,975 | ) | |||||||||||
— | — | — | (662 | ) | |||||||||||
— | (3,790,442 | ) | — | (84,507 | ) | ||||||||||
38,011,165 | 139,344,970 | 5,449,741 | 682,689 | ||||||||||||
939,542 | 1,474,772 | 606,380 | 410,412 | ||||||||||||
9,117 | 620,586 | — | — | ||||||||||||
— | 3,136,183 | — | 74,579 | ||||||||||||
— | 23,781 | — | 9,928 | ||||||||||||
— | 6,411 | — | — | ||||||||||||
(42,410,629 | ) | (105,969,725 | ) | (75,878 | ) | (1,100,816 | ) | ||||||||
(805,047 | ) | (1,017,541 | ) | (3,645 | ) | (194,160 | ) | ||||||||
(30,329 | ) | (60,674 | ) | — | — | ||||||||||
(4,286,181 | ) | 37,558,763 | 5,976,598 | (117,368 | ) | ||||||||||
21,692,975 | (21,868,006 | ) | 6,518,041 | (964,759 | ) | ||||||||||
210,302,144 | 232,170,150 | 3,582,232 | 4,546,991 | ||||||||||||
$ | 231,995,119 | $ | 210,302,144 | $ | 10,100,273 | $ | 3,582,232 |
Semi-Annual Report 153
Lazard Developing Markets Equity Portfolio | ||||||||
Six Months Ended | Year Ended | |||||||
June 30, 2019 | December 31, | |||||||
(unaudited) | 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 18,836,550 | 18,562,591 | ||||||
Shares sold | 3,375,286 | 8,208,714 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 92,256 | ||||||
Shares redeemed | (4,794,782 | ) | (8,027,011 | ) | ||||
Net increase (decrease) | (1,419,496 | ) | 273,959 | |||||
Shares outstanding at end of period | 17,417,054 | 18,836,550 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 639,563 | 869,884 | ||||||
Shares sold | 204,959 | 308,910 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 5,519 | ||||||
Shares redeemed | (150,915 | ) | (544,750 | ) | ||||
Net increase (decrease) | 54,044 | (230,321 | ) | |||||
Shares outstanding at end of period | 693,607 | 639,563 | ||||||
R6 Shares† | ||||||||
Shares outstanding at beginning of period | — | — | ||||||
Shares sold | — | — | ||||||
Shares issued to shareholders from reinvestment of distributions | — | — | ||||||
Shares redeemed | — | — | ||||||
Net increase (decrease) | — | — | ||||||
Shares outstanding at end of period | — | — |
† The inception date for the R6 Shares was April 6, 2018. |
The accompanying notes are an integral part of these financial statements.
154 Semi-Annual Report
Lazard Emerging Markets Core Equity Portfolio | Lazard Emerging Markets Equity Advantage Portfolio | |||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | |||||||||||||
21,031,193 | 18,723,561 | 309,610 | 341,687 | |||||||||||||
3,547,887 | 11,637,703 | 495,306 | 61,001 | |||||||||||||
— | 323,559 | — | 7,564 | |||||||||||||
(3,946,095 | ) | (9,653,630 | ) | (6,785 | ) | (100,642 | ) | |||||||||
(398,208 | ) | 2,307,632 | 488,521 | (32,077 | ) | |||||||||||
20,632,985 | 21,031,193 | 798,131 | 309,610 | |||||||||||||
187,835 | 148,907 | 47,382 | 29,020 | |||||||||||||
86,776 | 129,653 | 55,021 | 33,843 | |||||||||||||
— | 2,458 | — | 1,007 | |||||||||||||
(75,005 | ) | (93,183 | ) | (327 | ) | (16,488 | ) | |||||||||
11,771 | 38,928 | 54,694 | 18,362 | |||||||||||||
199,606 | 187,835 | 102,076 | 47,382 | |||||||||||||
49,941 | — | — | — | |||||||||||||
845 | 54,318 | — | — | |||||||||||||
— | 661 | — | — | |||||||||||||
(2,893 | ) | (5,038 | ) | — | — | |||||||||||
(2,048 | ) | 49,941 | — | — | ||||||||||||
47,893 | 49,941 | — | — |
Semi-Annual Report155
Lazard Emerging Markets Equity Blend Portfolio | ||||||||
Six Months Ended | Year Ended | |||||||
June 30, 2019 | December 31, | |||||||
(unaudited) | 2018 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 1,783,399 | $ | 5,014,573 | ||||
Net realized gain (loss) on investments and foreign currency transactions | 4,026,999 | 7,815,785 | ||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 28,584,702 | (95,667,829 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 34,395,100 | (82,837,471 | ) | |||||
Distributions to shareholders (Note 2(e)) | ||||||||
Institutional Shares | — | (5,376,473 | ) | |||||
Open Shares | — | (90,707 | ) | |||||
R6 Shares | — | — | ||||||
Net decrease in net assets resulting from distributions | — | (5,467,180 | ) | |||||
Capital stock transactions | ||||||||
Net proceeds from sales | ||||||||
Institutional Shares | 13,995,129 | 61,509,551 | ||||||
Open Shares | 516,132 | 2,180,238 | ||||||
R6 Shares | — | — | ||||||
Net proceeds from reinvestment of distributions | ||||||||
Institutional Shares | — | 5,295,445 | ||||||
Open Shares | — | 89,138 | ||||||
R6 Shares | — | — | ||||||
Cost of shares redeemed | ||||||||
Institutional Shares | (246,648,583 | ) | (74,641,893 | ) | ||||
Open Shares | (1,089,442 | ) | (3,743,056 | ) | ||||
R6 Shares | — | — | ||||||
Net increase (decrease) in net assets from capital stock transactions | (233,226,764 | ) | (9,310,577 | ) | ||||
Total increase (decrease) in net assets | (198,831,664 | ) | (97,615,228 | ) | ||||
Net assets at beginning of period | 297,604,288 | 395,219,516 | ||||||
Net assets at end of period | $ | 98,772,624 | $ | 297,604,288 |
The accompanying notes are an integral part of these financial statements.
156 Semi-Annual Report
Lazard Emerging Markets Equity Portfolio | Lazard Equity Franchise Portfolio | |||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | |||||||||||||
$ | 107,332,728 | $ | 240,361,347 | $ | 349,273 | $ | 156,813 | |||||||||
108,458,743 | 83,373,211 | 218,186 | 655,895 | |||||||||||||
675,877,583 | (2,584,037,244 | ) | 214,285 | (1,249,640 | ) | |||||||||||
891,669,054 | (2,260,302,686 | ) | 781,744 | (436,932 | ) | |||||||||||
— | (161,807,179 | ) | — | (840,278 | ) | |||||||||||
— | (18,476,071 | ) | — | (17,593 | ) | |||||||||||
— | (5,115,396 | ) | — | — | ||||||||||||
— | (185,398,646 | ) | — | (857,871 | ) | |||||||||||
566,970,486 | 1,966,180,706 | 28,437,382 | 3,799,029 | |||||||||||||
143,691,070 | 306,879,204 | 10,503 | 133,054 | |||||||||||||
17,628,710 | 31,823,654 | — | — | |||||||||||||
— | 151,836,697 | — | 840,278 | |||||||||||||
— | 18,130,779 | — | 17,593 | |||||||||||||
— | 3,561,076 | — | — | |||||||||||||
(1,774,659,575 | ) | (3,712,443,436 | ) | (677,603 | ) | (598,862 | ) | |||||||||
(217,101,920 | ) | (575,821,409 | ) | (151 | ) | (41,913 | ) | |||||||||
(89,519,867 | ) | (107,150,726 | ) | — | — | |||||||||||
(1,352,991,096 | ) | (1,917,003,455 | ) | 27,770,131 | 4,149,179 | |||||||||||
(461,322,042 | ) | (4,362,704,787 | ) | 28,551,875 | 2,854,376 | |||||||||||
8,810,936,808 | 13,173,641,595 | 8,530,889 | 5,676,513 | |||||||||||||
$ | 8,349,614,766 | $ | 8,810,936,808 | $ | 37,082,764 | $ | 8,530,889 |
Semi-Annual Report 157
Lazard Emerging | |||||||||
Markets Equity Blend Portfolio | |||||||||
Six Months Ended | Year Ended | ||||||||
June 30, 2019 | December 31, | ||||||||
(unaudited) | 2018 | ||||||||
Shares issued and redeemed | |||||||||
Institutional Shares | |||||||||
Shares outstanding at beginning of period | 29,084,201 | 29,825,093 | |||||||
Shares sold | 1,245,724 | 5,068,945 | |||||||
Shares issued to shareholders from reinvestment of distributions | — | 536,388 | |||||||
Shares redeemed | (22,314,816 | ) | (6,346,225 | ) | |||||
Net increase (decrease) | (21,069,092 | ) | (740,892 | ) | |||||
Shares outstanding at end of period | 8,015,109 | 29,084,201 | |||||||
Open Shares | |||||||||
Shares outstanding at beginning of period | 617,871 | 751,456 | |||||||
Shares sold | 46,043 | 174,662 | |||||||
Shares issued to shareholders from reinvestment of distributions | — | 9,005 | |||||||
Shares redeemed | (96,844 | ) | (317,252 | ) | |||||
Net increase (decrease) | (50,801 | ) | (133,585 | ) | |||||
Shares outstanding at end of period | 567,070 | 617,871 | |||||||
R6 Shares | |||||||||
Shares outstanding at beginning of period | — | — | |||||||
Shares sold | — | — | |||||||
Shares issued to shareholders from reinvestment of distributions | — | — | |||||||
Shares redeemed | — | — | |||||||
Net increase (decrease) | — | — | |||||||
Shares outstanding at end of period | — | — |
The accompanying notes are an integral part of these financial statements.
158 Semi-Annual Report
Lazard Emerging Markets Equity Portfolio | Lazard Equity Franchise Portfolio | |||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | |||||||||||||
471,588,782 | 563,580,657 | 943,047 | 536,277 | |||||||||||||
32,713,136 | 104,450,860 | 2,819,499 | 366,709 | |||||||||||||
— | 9,444,619 | — | 96,662 | |||||||||||||
(101,947,050 | ) | (205,887,354 | ) | (68,515 | ) | (56,601 | ) | |||||||||
(69,233,914 | ) | (91,991,875 | ) | 2,750,984 | 406,770 | |||||||||||
402,354,868 | 471,588,782 | 3,694,031 | 943,047 | |||||||||||||
60,776,573 | 73,583,131 | 21,455 | 10,687 | |||||||||||||
8,101,376 | 16,934,111 | 1,145 | 12,698 | |||||||||||||
— | 1,095,146 | — | 2,021 | |||||||||||||
(12,126,791 | ) | (30,835,815 | ) | (15 | ) | (3,951 | ) | |||||||||
(4,025,415 | ) | (12,806,558 | ) | 1,130 | 10,768 | |||||||||||
56,751,158 | 60,776,573 | 22,585 | 21,455 | |||||||||||||
14,479,168 | 18,608,156 | — | — | |||||||||||||
999,149 | 1,671,090 | — | — | |||||||||||||
— | 221,226 | — | — | |||||||||||||
(5,279,644 | ) | (6,021,304 | ) | — | — | |||||||||||
(4,280,495 | ) | (4,128,988 | ) | — | — | |||||||||||
10,198,673 | 14,479,168 | — | — |
Semi-Annual Report 159
Lazard Global Equity Select Portfolio | ||||||||||
Six Months Ended | Year Ended | |||||||||
June 30, 2019 | December 31, | |||||||||
(unaudited) | 2018 | |||||||||
Increase (Decrease) in Net Assets | ||||||||||
Operations | ||||||||||
Net investment income (loss) | $ | 458,019 | $ | 472,082 | ||||||
Net realized gain (loss) on investments, foreign currency transactions and forward currency contracts | 2,564,571 | 1,129,110 | ||||||||
Net change in unrealized appreciation (depreciation) on investments, foreign currency translations and forward currency contracts | 9,177,961 | (6,721,129 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | 12,200,551 | (5,119,937 | ) | |||||||
Distributions to shareholders (Note 2(e)) | ||||||||||
Institutional Shares | — | (2,021,764 | ) | |||||||
Open Shares | — | (21,670 | ) | |||||||
Return of capital | ||||||||||
Institutional Shares | — | (55,115 | ) | |||||||
Open Shares | — | (591 | ) | |||||||
Net decrease in net assets resulting from distributions | — | (2,099,140 | ) | |||||||
Capital stock transactions | ||||||||||
Net proceeds from sales | ||||||||||
Institutional Shares | 8,680,518 | 27,026,953 | ||||||||
Open Shares | 176,609 | 183,864 | ||||||||
Net proceeds from reinvestment of distributions | ||||||||||
Institutional Shares | — | 2,076,864 | ||||||||
Open Shares | — | 22,261 | ||||||||
Cost of shares redeemed | ||||||||||
Institutional Shares | (15,587,700 | ) | (14,792,583 | ) | ||||||
Open Shares | (78,856 | ) | (65,826 | ) | ||||||
Net increase (decrease) in net assets from capital stock transactions | (6,809,429 | ) | 14,451,533 | |||||||
Total increase (decrease) in net assets | 5,391,122 | 7,232,456 | ||||||||
Net assets at beginning of period | 66,144,900 | 58,912,444 | ||||||||
Net assets at end of period | $ | 71,536,022 | $ | 66,144,900 | ||||||
Shares issued and redeemed | ||||||||||
Institutional Shares | ||||||||||
Shares outstanding at beginning of period | 5,577,806 | 4,464,645 | ||||||||
Shares sold | 662,556 | 2,056,703 | ||||||||
Shares issued to shareholders from reinvestment of distributions | — | 179,116 | ||||||||
Shares redeemed | (1,170,173 | ) | (1,122,658 | ) | ||||||
Net increase (decrease) | (507,617 | ) | 1,113,161 | |||||||
Shares outstanding at end of period | 5,070,189 | 5,577,806 | ||||||||
Open Shares | ||||||||||
Shares outstanding at beginning of period | 65,049 | 54,514 | ||||||||
Shares sold | 13,238 | 13,747 | ||||||||
Shares issued to shareholders from reinvestment of distributions | — | 1,916 | ||||||||
Shares redeemed | (5,945 | ) | (5,128 | ) | ||||||
Net increase (decrease) | 7,293 | 10,535 | ||||||||
Shares outstanding at end of period | 72,342 | 65,049 |
The accompanying notes are an integral part of these financial statements.
160 Semi-Annual Report
Lazard Global Listed Infrastructure Portfolio | Lazard Global Strategic Equity Portfolio | |||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | |||||||||||||
$ | 124,050,074 | $ | 138,893,718 | $ | 13,160 | $ | 16,927 | |||||||||
(21,801,195 | ) | 474,528,611 | 59,717 | 108,933 | ||||||||||||
702,270,471 | (836,415,967 | ) | 432,598 | (397,832 | ) | |||||||||||
804,519,350 | (222,993,638 | ) | 505,475 | (271,972 | ) | |||||||||||
(71,509,731 | ) | (630,234,998 | ) | — | (620,429 | ) | ||||||||||
(5,119,244 | ) | (56,258,605 | ) | — | (33,292 | ) | ||||||||||
— | — | — | — | |||||||||||||
— | — | — | — | |||||||||||||
(76,628,975 | ) | (686,493,603 | ) | — | (653,721 | ) | ||||||||||
1,270,562,455 | 2,344,513,648 | 10,597 | 97,922 | |||||||||||||
91,520,323 | 148,282,804 | 3,048 | 6,946 | |||||||||||||
55,966,042 | 504,145,256 | — | 620,429 | |||||||||||||
5,065,107 | 55,689,132 | — | 33,292 | |||||||||||||
(674,462,063 | ) | (1,871,789,545 | ) | (62,012 | ) | (85,002 | ) | |||||||||
(96,903,530 | ) | (331,531,149 | ) | (16,554 | ) | (10,368 | ) | |||||||||
651,748,334 | 849,310,146 | (64,921 | ) | 663,219 | ||||||||||||
1,379,638,709 | (60,177,095 | ) | 440,554 | (262,474 | ) | |||||||||||
5,351,108,690 | 5,411,285,785 | 2,636,691 | 2,899,165 | |||||||||||||
$ | 6,730,747,399 | $ | 5,351,108,690 | $ | 3,077,245 | $ | 2,636,691 | |||||||||
364,507,349 | 298,732,092 | 1,530,838 | 1,190,583 | |||||||||||||
86,883,504 | 154,668,026 | 6,239 | 43,028 | |||||||||||||
3,695,292 | 35,491,935 | — | 334,204 | |||||||||||||
(45,975,741 | ) | (124,384,704 | ) | (34,671 | ) | (36,977 | ) | |||||||||
44,603,055 | 65,775,257 | (28,432 | ) | 340,255 | ||||||||||||
409,110,404 | 364,507,349 | 1,502,406 | 1,530,838 | |||||||||||||
31,560,099 | 39,560,407 | 80,778 | 64,619 | |||||||||||||
6,248,775 | 9,614,733 | 1,572 | 2,964 | |||||||||||||
334,303 | 3,911,178 | — | 18,057 | |||||||||||||
(6,597,856 | ) | (21,526,219 | ) | (8,741 | ) | (4,862 | ) | |||||||||
(14,778 | ) | (8,000,308 | ) | (7,169 | ) | 16,159 | ||||||||||
31,545,321 | 31,560,099 | 73,609 | 80,778 |
Semi-Annual Report 161
Lazard International | ||||||||||
Quality Growth Portfolio | ||||||||||
Six Months Ended | Year Ended | |||||||||
June 30, 2019 | December 31, | |||||||||
(unaudited) | 2018 (a) | |||||||||
Increase (Decrease) in Net Assets | ||||||||||
Operations | ||||||||||
Net investment income (loss) | $ | 23,391 | $ | — | ||||||
Net realized gain (loss) on investments and foreign currency transactions | 8,087 | — | ||||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 577,832 | (295 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | 609,310 | (295 | ) | |||||||
Distributions to shareholders (Note 2(e)) | ||||||||||
Institutional Shares | — | — | ||||||||
Open Shares | — | — | ||||||||
Net decrease in net assets resulting from distributions | — | — | ||||||||
Capital stock transactions | ||||||||||
Net proceeds from sales | ||||||||||
Institutional Shares | 2,860,000 | 149,000 | ||||||||
Open Shares | 13,500 | 1,000 | ||||||||
Net proceeds from reinvestment of distributions | ||||||||||
Institutional Shares | — | — | ||||||||
Open Shares | — | — | ||||||||
Cost of shares redeemed | ||||||||||
Institutional Shares | — | — | ||||||||
Open Shares | (10,192 | ) | — | |||||||
Net increase (decrease) in net assets from capital stock transactions | 2,863,308 | 150,000 | ||||||||
Total increase (decrease) in net assets | 3,472,618 | 149,705 | ||||||||
Net assets at beginning of period | 149,705 | — | ||||||||
Net assets at end of period | $ | 3,622,323 | $ | 149,705 | ||||||
Shares issued and redeemed | ||||||||||
Institutional Shares | ||||||||||
Shares outstanding at beginning of period | 14,900 | — | ||||||||
Shares sold | 285,824 | 14,900 | ||||||||
Shares issued to shareholders from reinvestment of distributions | — | — | ||||||||
Shares redeemed | — | — | ||||||||
Net increase (decrease) | 285,824 | 14,900 | ||||||||
Shares outstanding at end of period | 300,724 | 14,900 | ||||||||
Open Shares | ||||||||||
Shares outstanding at beginning of period | 100 | — | ||||||||
Shares sold | 1,176 | 100 | ||||||||
Shares issued to shareholders from reinvestment of distributions | — | — | ||||||||
Shares redeemed | (874 | ) | — | |||||||
Net increase (decrease) | 302 | 100 | ||||||||
Shares outstanding at end of period | 402 | 100 |
(a) The Portfolio commenced operations on December 31, 2018.
The accompanying notes are an integral part of these financial statements.
162 Semi-Annual Report
Lazard International | Lazard International | |||||||||||||||
Equity Advantage Portfolio | Equity Concentrated Portfolio | |||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | |||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | |||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | |||||||||||||
$ | 39,405 | $ | 57,409 | $ | 1,393,739 | $ | 1,030,116 | |||||||||
(32,812 | ) | 76,385 | 447,633 | (539,632 | ) | |||||||||||
241,723 | (562,157 | ) | 8,971,820 | (12,702,020 | ) | |||||||||||
248,316 | (428,363 | ) | 10,813,192 | (12,211,536 | ) | |||||||||||
— | (102,427 | ) | — | (2,385,665 | ) | |||||||||||
— | (4,439 | ) | — | (17,538 | ) | |||||||||||
— | (106,866 | ) | — | (2,403,203 | ) | |||||||||||
— | 500 | 30,291,569 | 15,603,350 | |||||||||||||
— | 11 | 650 | 267,250 | |||||||||||||
— | 102,427 | — | 2,339,572 | |||||||||||||
— | 4,439 | — | 17,538 | |||||||||||||
— | (47,991 | ) | (3,004,164 | ) | (23,748,931 | ) | ||||||||||
— | (11 | ) | (60,534 | ) | (19,451 | ) | ||||||||||
— | 59,375 | 27,227,521 | (5,540,672 | ) | ||||||||||||
248,316 | (475,854 | ) | 38,040,713 | (20,155,411 | ) | |||||||||||
2,148,062 | 2,623,916 | 49,504,213 | 69,659,624 | |||||||||||||
$ | 2,396,378 | $ | 2,148,062 | $ | 87,544,926 | $ | 49,504,213 | |||||||||
235,905 | 229,680 | 5,888,251 | 6,658,885 | |||||||||||||
— | 45 | 3,290,545 | 1,557,217 | |||||||||||||
— | 11,722 | — | 286,268 | |||||||||||||
— | (5,542 | ) | (325,246 | ) | (2,614,119 | ) | ||||||||||
— | 6,225 | 2,965,299 | (770,634 | ) | ||||||||||||
235,905 | 235,905 | 8,853,550 | 5,888,251 | |||||||||||||
11,106 | 10,599 | 47,769 | 21,011 | |||||||||||||
— | 1 | 67 | 26,848 | |||||||||||||
— | 507 | — | 2,144 | |||||||||||||
— | (1 | ) | (6,255 | ) | (2,234 | ) | ||||||||||
— | 507 | (6,188 | ) | 26,758 | ||||||||||||
11,106 | 11,106 | 41,581 | 47,769 |
Semi-Annual Report 163
Lazard International Equity Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 46,627,197 | $ | 62,190,848 | ||||
Net realized gain (loss) on investments and foreign currency transactions | (8,780,814 | ) | 132,220,543 | |||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 345,487,570 | (625,076,980 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 383,333,953 | (430,665,589 | ) | |||||
Distributions to shareholders (Note 2(e)) | ||||||||
Institutional Shares | — | (162,037,288 | ) | |||||
Open Shares | — | (16,140,086 | ) | |||||
R6 Shares | — | (9,585,071 | ) | |||||
Net decrease in net assets resulting from distributions | — | (187,762,445 | ) | |||||
Capital stock transactions | ||||||||
Net proceeds from sales | ||||||||
Institutional Shares | 360,383,786 | 692,426,011 | ||||||
Open Shares | 39,035,693 | 71,811,533 | ||||||
R6 Shares | 15,176,604 | 51,158,456 | ||||||
Net proceeds from reinvestment of distributions | ||||||||
Institutional Shares | — | 135,295,299 | ||||||
Open Shares | — | 14,706,387 | ||||||
R6 Shares | — | 9,585,071 | ||||||
Cost of shares redeemed | ||||||||
Institutional Shares | (295,417,571 | ) | (1,024,041,994 | ) | ||||
Open Shares | (40,877,422 | ) | (80,776,096 | ) | ||||
R6 Shares | (20,884,089 | ) | (619,023,756 | ) | ||||
Net increase (decrease) in net assets from capital stock transactions | 57,417,001 | (748,859,089 | ) | |||||
Total increase (decrease) in net assets | 440,750,954 | (1,367,287,123 | ) | |||||
Net assets at beginning of period | 2,436,733,231 | 3,804,020,354 | ||||||
Net assets at end of period | $ | 2,877,484,185 | $ | 2,436,733,231 |
The accompanying notes are an integral part of these financial statements.
164 Semi-Annual Report
Lazard International Equity Select Portfolio | Lazard International Equity Value Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 (b) | |||||||||||||
$ | 1,284,458 | $ | 1,333,945 | $ | 561,058 | $ | 28,960 | |||||||||
457,880 | 338,398 | 260,621 | (696,490 | ) | ||||||||||||
10,281,909 | (14,665,490 | ) | 1,164,337 | (1,462,526 | ) | |||||||||||
12,024,247 | (12,993,147 | ) | 1,986,016 | (2,130,056 | ) | |||||||||||
— | (1,895,320 | ) | — | (26,179 | ) | |||||||||||
— | (30,210 | ) | — | (36 | ) | |||||||||||
— | — | — | — | |||||||||||||
— | (1,925,530 | ) | — | (26,215 | ) | |||||||||||
16,949,700 | 65,277,340 | 260,515 | 25,094,341 | |||||||||||||
618,053 | 1,202,007 | 38,524 | 94,078 | |||||||||||||
— | — | — | — | |||||||||||||
— | 1,746,591 | — | 26,179 | |||||||||||||
— | 30,210 | — | 36 | |||||||||||||
— | — | — | — | |||||||||||||
(12,030,280 | ) | (31,783,405 | ) | — | (26,571 | ) | ||||||||||
(763,116 | ) | (2,229,497 | ) | (8,895 | ) | (47,885 | ) | |||||||||
— | — | — | — | |||||||||||||
4,774,357 | 34,243,246 | 290,144 | 25,140,178 | |||||||||||||
16,798,604 | 19,324,569 | 2,276,160 | 22,983,907 | |||||||||||||
76,084,318 | 56,759,749 | 22,983,907 | — | |||||||||||||
$ | 92,882,922 | $ | 76,084,318 | $ | 25,260,067 | $ | 22,983,907 |
Semi-Annual Report 165
Lazard International Equity Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 134,128,473 | 144,593,511 | ||||||
Shares sold | 21,206,201 | 36,738,628 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 8,719,524 | ||||||
Shares redeemed | (17,267,165 | ) | (55,923,190 | ) | ||||
Net increase (decrease) | 3,939,036 | (10,465,038 | ) | |||||
Shares outstanding at end of period | 138,067,509 | 134,128,473 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 14,336,300 | 13,869,285 | ||||||
Shares sold | 2,204,959 | 3,733,499 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 936,334 | ||||||
Shares redeemed | (2,367,324 | ) | (4,202,818 | ) | ||||
Net increase (decrease) | (162,365 | ) | 467,015 | |||||
Shares outstanding at end of period | 14,173,935 | 14,336,300 | ||||||
R6 Shares | ||||||||
Shares outstanding at beginning of period | 6,803,382 | 35,418,952 | ||||||
Shares sold | 885,239 | 2,684,577 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 618,559 | ||||||
Shares redeemed | (1,243,406 | ) | (31,918,706 | ) | ||||
Net increase (decrease) | (358,167 | ) | (28,615,570 | ) | ||||
Shares outstanding at end of period | 6,445,215 | 6,803,382 |
(b) | The Portfolio commenced operations on October 31, 2018. |
The accompanying notes are an integral part of these financial statements.
166 Semi-Annual Report
Lazard International Equity Select Portfolio | Lazard International Equity Value Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 (b) | |||||||||||||
8,172,571 | 4,895,525 | 2,509,997 | — | |||||||||||||
1,718,920 | 6,149,590 | 27,020 | 2,509,986 | |||||||||||||
— | 187,099 | — | 2,928 | |||||||||||||
(1,203,373 | ) | (3,059,643 | ) | — | (2,917 | ) | ||||||||||
515,547 | 3,277,046 | 27,020 | 2,509,997 | |||||||||||||
8,688,118 | 8,172,571 | 2,537,017 | 2,509,997 | |||||||||||||
163,761 | 256,624 | 4,211 | — | |||||||||||||
61,995 | 113,077 | 3,956 | 9,423 | |||||||||||||
— | 3,261 | — | 4 | |||||||||||||
(75,678 | ) | (209,201 | ) | (901 | ) | (5,216 | ) | |||||||||
(13,683 | ) | (92,863 | ) | 3,055 | 4,211 | |||||||||||
150,078 | 163,761 | 7,266 | 4,211 | |||||||||||||
— | — | — | — | |||||||||||||
— | — | — | — | |||||||||||||
— | — | — | — | |||||||||||||
— | — | — | — | |||||||||||||
— | — | — | — | |||||||||||||
— | — | — | — |
Semi-Annual Report 167
Lazard International Small Cap Equity Portfolio | ||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||
Increase (Decrease) in Net Assets | ||||||||||
Operations | ||||||||||
Net investment income (loss) | $ | 563,987 | $ | 676,876 | ||||||
Net realized gain (loss) on investments and foreign currency transactions | (1,509,383 | ) | 7,560,083 | |||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 8,592,077 | (27,323,558 | ) | |||||||
Net increase (decrease) in net assets resulting from operations | 7,646,681 | (19,086,599 | ) | |||||||
Distributions to shareholders (Note 2(e)) | ||||||||||
Institutional Shares | — | (1,675,001 | ) | |||||||
Open Shares | — | (844,717 | ) | |||||||
R6 Shares | — | — | ||||||||
Net decrease in net assets resulting from distributions | — | (2,519,718 | ) | |||||||
Capital stock transactions | ||||||||||
Net proceeds from sales | ||||||||||
Institutional Shares | 3,502,754 | 22,184,618 | ||||||||
Open Shares | 1,116,538 | 5,161,365 | ||||||||
R6 Shares | — | — | ||||||||
Net proceeds from reinvestment of distributions | ||||||||||
Institutional Shares | — | 1,671,063 | ||||||||
Open Shares | — | 765,533 | ||||||||
R6 Shares | — | — | ||||||||
Cost of shares redeemed | ||||||||||
Institutional Shares | (5,860,546 | ) | (16,237,337 | ) | ||||||
Open Shares | (4,195,061 | ) | (20,181,718 | ) | ||||||
R6 Shares | — | — | ||||||||
Net increase (decrease) in net assets from capital stock transactions | (5,436,315 | ) | (6,636,476 | ) | ||||||
Total increase (decrease) in net assets | 2,210,366 | (28,242,793 | ) | |||||||
Net assets at beginning of period | 55,386,199 | 83,628,992 | ||||||||
Net assets at end of period | $ | 57,596,565 | $ | 55,386,199 |
The accompanying notes are an integral part of these financial statements.
168 Semi-Annual Report
Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
$ | 82,586,335 | $ | 89,333,071 | $ | 238,311 | $ | 315,398 | |||||||||
(33,588,203 | ) | 555,754,186 | 288,589 | (294,609 | ) | |||||||||||
815,508,383 | (1,299,655,438 | ) | 2,644,380 | (1,538,663 | ) | |||||||||||
864,506,515 | (654,568,181 | ) | 3,171,280 | (1,517,874 | ) | |||||||||||
— | (390,962,878 | ) | — | (381,378 | ) | |||||||||||
— | (67,997,086 | ) | — | (4,224 | ) | |||||||||||
— | (8,298,386 | ) | — | — | ||||||||||||
— | (467,258,350 | ) | — | (385,602 | ) | |||||||||||
520,439,052 | 1,191,814,486 | 1,664,044 | 20,348,996 | |||||||||||||
75,683,936 | 220,196,653 | — | 30,826 | |||||||||||||
6,194,368 | 25,261,981 | — | — | |||||||||||||
— | 377,793,204 | — | 346,406 | |||||||||||||
— | 62,572,751 | — | 2,739 | |||||||||||||
— | 8,184,877 | — | — | |||||||||||||
(473,130,066 | ) | (1,912,545,919 | ) | (321,345 | ) | (2,294,274 | ) | |||||||||
(138,718,461 | ) | (503,144,624 | ) | — | (134,055 | ) | ||||||||||
(11,495,010 | ) | (26,460,064 | ) | — | — | |||||||||||
(21,026,181 | ) | (556,326,655 | ) | 1,342,699 | 18,300,638 | |||||||||||
843,480,334 | (1,678,153,186 | ) | 4,513,979 | 16,397,162 | ||||||||||||
5,560,275,482 | 7,238,428,668 | 20,892,067 | 4,494,905 | |||||||||||||
$ | 6,403,755,816 | $ | 5,560,275,482 | $ | 25,406,046 | $ | 20,892,067 |
Semi-Annual Report 169
Lazard International Small Cap Equity Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 3,529,666 | 2,993,040 | ||||||
Shares sold | 316,885 | 1,656,082 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 146,870 | ||||||
Shares redeemed | (533,058 | ) | (1,266,326 | ) | ||||
Net increase (decrease) | (216,173 | ) | 536,626 | |||||
Shares outstanding at end of period | 3,313,493 | 3,529,666 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 2,031,598 | 3,064,171 | ||||||
Shares sold | 101,412 | 401,822 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 68,202 | ||||||
Shares redeemed | (382,525 | ) | (1,502,597 | ) | ||||
Net increase (decrease) | (281,113 | ) | (1,032,573 | ) | ||||
Shares outstanding at end of period | 1,750,485 | 2,031,598 | ||||||
R6 Shares | ||||||||
Shares outstanding at beginning of period | — | — | ||||||
Shares sold | — | — | ||||||
Shares issued to shareholders from reinvestment of distributions | — | — | ||||||
Shares redeemed | — | — | ||||||
Net increase (decrease) | — | — | ||||||
Shares outstanding at end of period | — | — |
The accompanying notes are an integral part of these financial statements.
170 Semi-Annual Report
Lazard International Strategic Equity Portfolio | Lazard Managed Equity Volatility Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
359,227,186 | 376,589,551 | 1,963,386 | 361,300 | |||||||||||||
36,840,892 | 76,867,462 | 140,919 | 1,790,614 | |||||||||||||
— | 29,898,424 | — | 33,373 | |||||||||||||
(33,115,889 | ) | (124,128,251 | ) | (27,950 | ) | (221,901 | ) | |||||||||
3,725,003 | (17,362,365 | ) | 112,969 | 1,602,086 | ||||||||||||
362,952,189 | 359,227,186 | 2,076,355 | 1,963,386 | |||||||||||||
64,009,753 | 76,885,738 | 17,404 | 27,255 | |||||||||||||
5,285,295 | 14,094,427 | — | 2,695 | |||||||||||||
— | 4,909,122 | — | 262 | |||||||||||||
(9,670,607 | ) | (31,879,534 | ) | — | (12,808 | ) | ||||||||||
(4,385,312 | ) | (12,875,985 | ) | — | (9,851 | ) | ||||||||||
59,624,441 | 64,009,753 | 17,404 | 17,404 | |||||||||||||
7,549,275 | 7,026,668 | — | — | |||||||||||||
429,342 | 1,599,586 | — | — | |||||||||||||
— | 647,215 | — | — | |||||||||||||
(793,238 | ) | (1,724,194 | ) | — | — | |||||||||||
(363,896 | ) | 522,607 | — | — | ||||||||||||
7,185,379 | 7,549,275 | — | — |
Semi-Annual Report 171
Lazard US Equity Concentrated Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 5,062,534 | $ | 17,196,730 | ||||
Net realized gain (loss) on investments and foreign currency transactions | 11,709,180 | 74,632,752 | ||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 222,815,977 | (172,165,758 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 239,587,691 | (80,336,276 | ) | |||||
Distributions to shareholders (Note 2(e)) | ||||||||
Institutional Shares | — | (126,901,740 | ) | |||||
Open Shares | — | (5,585,479 | ) | |||||
R6 Shares | — | (158,630 | ) | |||||
Net decrease in net assets resulting from distributions | — | (132,645,849 | ) | |||||
Capital stock transactions | ||||||||
Net proceeds from sales | ||||||||
Institutional Shares | 168,991,263 | 231,478,214 | ||||||
Open Shares | 5,074,443 | 15,671,466 | ||||||
R6 Shares | 43,466 | 2,047,701 | ||||||
Issued in connection with acquisition of US Realty | ||||||||
Income Portfolio | ||||||||
Institutional Shares | — | — | ||||||
Open Shares | — | — | ||||||
Net proceeds from reinvestment of distributions | ||||||||
Institutional Shares | — | 114,753,886 | ||||||
Open Shares | — | 5,517,497 | ||||||
R6 Shares | — | 158,630 | ||||||
Cost of shares redeemed | ||||||||
Institutional Shares | (196,025,957 | ) | (609,674,559 | ) | ||||
Open Shares | (19,668,130 | ) | (49,537,525 | ) | ||||
R6 Shares | (91,831 | ) | (245,106 | ) | ||||
Net increase (decrease) in net assets from capital stock transactions | (41,676,746 | ) | (289,829,796 | ) | ||||
Total increase (decrease) in net assets | 197,910,945 | (502,811,921 | ) | |||||
Net assets at beginning of period | 1,093,732,246 | 1,596,544,167 | ||||||
Net assets at end of period | $ | 1,291,643,191 | $ | 1,093,732,246 |
The accompanying notes are an integral part of these financial statements.
172 Semi-Annual Report
Lazard US Equity Select Portfolio | Lazard US Realty Equity Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
$ | 427,722 | $ | 915,707 | $ | 732,457 | $ | 805,208 | |||||||||
2,438,347 | 7,992,281 | 727,327 | 2,480,557 | |||||||||||||
10,145,581 | (10,904,671 | ) | 10,496,157 | (9,938,039 | ) | |||||||||||
13,011,650 | (1,996,683 | ) | 11,955,941 | (6,652,274 | ) | |||||||||||
— | (9,488,347 | ) | — | (695,484 | ) | |||||||||||
— | (132,836 | ) | — | (1,716,582 | ) | |||||||||||
— | (1,527,040 | ) | — | — | ||||||||||||
— | (11,148,223 | ) | — | (2,412,066 | ) | |||||||||||
1,052,660 | 2,797,366 | 4,526,543 | 1,624,667 | |||||||||||||
19,622 | 54,694 | 1,570,378 | 3,032,454 | |||||||||||||
5,419,699 | 3,687,551 | — | — | |||||||||||||
— | — | — | 10,788,800 | |||||||||||||
— | — | — | 11,850,795 | |||||||||||||
— | 9,486,106 | — | 690,667 | |||||||||||||
— | 132,621 | — | 1,661,053 | |||||||||||||
— | 1,527,040 | — | — | |||||||||||||
(6,216,881 | ) | (13,412,997 | ) | (3,095,673 | ) | (13,277,642 | ) | |||||||||
(42,960 | ) | (159,494 | ) | (8,949,669 | ) | (14,180,850 | ) | |||||||||
(5,896,648 | ) | (4,765,670 | ) | — | — | |||||||||||
(5,664,508 | ) | (652,783 | ) | (5,948,421 | ) | 2,189,944 | ||||||||||
7,347,142 | (13,797,689 | ) | 6,007,520 | (6,874,396 | ) | |||||||||||
71,566,959 | 85,364,648 | 59,661,514 | 66,535,910 | |||||||||||||
$ | 78,914,101 | $ | 71,566,959 | $ | 65,669,034 | $ | 59,661,514 |
Semi-Annual Report 173
Lazard US Equity Concentrated Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 80,772,130 | 98,527,318 | ||||||
Shares sold | 11,874,196 | 14,982,089 | ||||||
Shares issued in connection with acquisition of Lazard Equity Portfolio | — | — | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 8,686,899 | ||||||
Shares redeemed | (13,342,430 | ) | (41,424,176 | ) | ||||
Net increase (decrease) | (1,468,234 | ) | (17,755,188 | ) | ||||
Shares outstanding at end of period | 79,303,896 | 80,772,130 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 3,925,727 | 5,681,791 | ||||||
Shares sold | 351,058 | 991,563 | ||||||
Shares issued in connection with acquisition of Lazard Equity Portfolio | — | — | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 413,698 | ||||||
Shares redeemed | (1,358,972 | ) | (3,161,325 | ) | ||||
Net increase (decrease) | (1,007,914 | ) | (1,756,064 | ) | ||||
Shares outstanding at end of period | 2,917,813 | 3,925,727 | ||||||
R6 Shares | ||||||||
Shares outstanding at beginning of period | 147,098 | 23,498 | ||||||
Shares sold | 2,961 | 126,703 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 12,595 | ||||||
Shares redeemed | (6,336 | ) | (15,698 | ) | ||||
Net increase (decrease) | (3,375 | ) | 123,600 | |||||
Shares outstanding at end of period | 143,723 | 147,098 |
The accompanying notes are an integral part of these financial statements.
174 Semi-Annual Report
Lazard US Equity Select Portfolio | Lazard US Realty Equity Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
5,927,072 | 5,870,874 | 941,829 | 993,322 | |||||||||||||
92,788 | 229,810 | 229,445 | 91,997 | |||||||||||||
— | — | — | 562,426 | |||||||||||||
— | 915,948 | — | 40,649 | |||||||||||||
(544,214 | ) | (1,089,560 | ) | (160,245 | ) | (746,565 | ) | |||||||||
(451,426 | ) | 56,198 | 69,200 | (51,493 | ) | |||||||||||
5,475,646 | 5,927,072 | 1,011,029 | 941,829 | |||||||||||||
85,762 | 81,216 | 2,621,072 | 2,524,879 | |||||||||||||
1,663 | 4,222 | 81,216 | 167,884 | |||||||||||||
— | — | — | 616,099 | |||||||||||||
— | 12,734 | — | 97,455 | |||||||||||||
(3,610 | ) | (12,410 | ) | (458,671 | ) | (785,245 | ) | |||||||||
(1,947 | ) | 4,546 | (377,455 | ) | 96,193 | |||||||||||
83,815 | 85,762 | 2,243,617 | 2,621,072 | |||||||||||||
982,747 | 916,579 | — | — | |||||||||||||
461,644 | 291,908 | — | — | |||||||||||||
— | 147,820 | — | — | |||||||||||||
(501,121 | ) | (373,560 | ) | — | — | |||||||||||
(39,477 | ) | 66,168 | — | — | ||||||||||||
943,270 | 982,747 | — | — |
Semi-Annual Report 175
Lazard US Small-Mid Cap Equity Portfolio | |||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | ||||||||
Increase (Decrease) in Net Assets | |||||||||
Operations | |||||||||
Net investment income (loss) | $ | 341,953 | $ | 597,923 | |||||
Net realized gain (loss) on investments and foreign currency transactions | 10,495,539 | 15,587,339 | |||||||
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions | 16,239,672 | (36,201,275 | ) | ||||||
Net increase (decrease) in net assets resulting from operations | 27,077,164 | (20,016,013 | ) | ||||||
Distributions to shareholders (Note 2(e)) | |||||||||
Institutional Shares | — | (17,695,195 | ) | ||||||
Open Shares | — | (2,222,866 | ) | ||||||
Net decrease in net assets resulting from distributions | — | (19,918,061 | ) | ||||||
Capital stock transactions | |||||||||
Net proceeds from sales | |||||||||
Institutional Shares | 6,206,295 | 21,485,449 | |||||||
Open Shares | 625,703 | 2,442,537 | |||||||
Net proceeds from reinvestment of distributions | |||||||||
Institutional Shares | — | 17,320,681 | |||||||
Open Shares | — | 2,058,605 | |||||||
Cost of shares redeemed | |||||||||
Institutional Shares | (72,816,160 | ) | (66,434,776 | ) | |||||
Open Shares | (2,743,121 | ) | (12,483,878 | ) | |||||
Net increase (decrease) in net assets from capital stock transactions | (68,727,283 | ) | (35,611,382 | ) | |||||
Total increase (decrease) in net assets | (41,650,119 | ) | (75,545,456 | ) | |||||
Net assets at beginning of period | 127,402,732 | 202,948,188 | |||||||
Net assets at end of period | $ | 85,752,613 | $ | 127,402,732 | |||||
Shares issued and redeemed | |||||||||
Institutional Shares | |||||||||
Shares outstanding at beginning of period | 10,493,688 | 12,081,329 | |||||||
Shares sold | 500,114 | 1,436,712 | |||||||
Shares issued to shareholders from reinvestment of distributions | — | 1,572,044 | |||||||
Shares redeemed | (5,572,633 | ) | (4,596,397 | ) | |||||
Net increase (decrease) | (5,072,519 | ) | (1,587,641 | ) | |||||
Shares outstanding at end of period | 5,421,169 | 10,493,688 | |||||||
Open Shares | |||||||||
Shares outstanding at beginning of period | 1,368,812 | 1,893,205 | |||||||
Shares sold | 55,262 | 183,177 | |||||||
Shares issued to shareholders from reinvestment of distributions | — | 201,850 | |||||||
Shares redeemed | (240,652 | ) | (909,420 | ) | |||||
Net increase (decrease) | (185,390 | ) | (524,393 | ) | |||||
Shares outstanding at end of period | 1,183,422 | 1,368,812 |
The accompanying notes are an integral part of these financial statements.
176 Semi-Annual Report
The Lazard Funds, Inc.Financial Highlights
LAZARD DEVELOPING MARKETS EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 11.42 | $ | 14.48 | $ | 10.28 | $ | 9.04 | $ | 10.43 | $ | 11.81 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.05 | 0.11 | 0.03 | 0.05 | ^ | 0.06 | 0.09 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.87 | (3.08 | ) | 4.20 | 1.29 | (1.40 | ) | (1.30 | ) | |||||||||||||||
Total from investment operations | 1.92 | (2.97 | ) | 4.23 | 1.34 | (1.34 | ) | (1.21 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.09 | ) | (0.03 | ) | (0.10 | ) | (0.05 | ) | (0.17 | ) | |||||||||||||
Total distributions | — | (0.09 | ) | (0.03 | ) | (0.10 | ) | (0.05 | ) | (0.17 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 13.34 | $ | 11.42 | $ | 14.48 | $ | 10.28 | $ | 9.04 | $ | 10.43 | ||||||||||||
Total Return (c) | 16.81 | % | –20.58 | % | 41.15 | % | 14.81 | %^ | –12.84 | % | –10.27 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 232,303 | $ | 215,120 | $ | 268,730 | $ | 189,035 | $ | 343,788 | $ | 426,847 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.14 | % | 1.14 | % | 1.18 | % | 1.21 | %^ | 1.20 | % | 1.19 | % | ||||||||||||
Gross expenses | 1.14 | % | 1.14 | % | 1.18 | % | 1.23 | % | 1.20 | % | 1.19 | % | ||||||||||||
Net investment income (loss) | 0.76 | % | 0.83 | % | 0.24 | % | 0.48 | %^ | 0.55 | % | 0.80 | % | ||||||||||||
Portfolio turnover rate | 37 | % | 63 | % | 46 | % | 56 | % | 66 | % | 57 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 177
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 11.36 | $ | 14.45 | $ | 10.28 | $ | 9.05 | $ | 10.43 | $ | 11.81 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.03 | 0.06 | (0.02 | ) | 0.01 | ^ | 0.01 | 0.08 | ||||||||||||||||
Net realized and unrealized gain (loss) | 1.85 | (3.06 | ) | 4.19 | 1.28 | (1.38 | ) | (1.33 | ) | |||||||||||||||
Total from investment operations | 1.88 | (3.00 | ) | 4.17 | 1.29 | (1.37 | ) | (1.25 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.09 | ) | — | (0.06 | ) | (0.01 | ) | (0.13 | ) | ||||||||||||||
Total distributions | — | (0.09 | ) | — | (0.06 | ) | (0.01 | ) | (0.13 | ) | ||||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 13.24 | $ | 11.36 | $ | 14.45 | $ | 10.28 | $ | 9.05 | $ | 10.43 | ||||||||||||
Total Return (c) | 16.55 | % | –20.83 | %# | 40.56 | % | 14.31 | %^ | –13.11 | % | –10.57 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 9,186 | $ | 7,263 | $ | 12,569 | $ | 7,272 | $ | 10,903 | $ | 16,029 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.43 | % | 1.51 | % | 1.58 | % | 1.60 | %^ | 1.57 | % | 1.49 | % | ||||||||||||
Gross expenses | 1.43 | % | 1.51 | % | 1.58 | % | 1.65 | % | 1.57 | % | 1.49 | % | ||||||||||||
Net investment income (loss) | 0.54 | % | 0.42 | % | –0.17 | % | 0.06 | %^ | 0.13 | % | 0.70 | % | ||||||||||||
Portfolio turnover rate | 37 | % | 63 | % | 46 | % | 56 | % | 66 | % | 57 | % |
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. For Institutional Shares, the impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. For Open Shares, the net expenses and net investment income (loss) ratios of the Portfolio would be unchanged as the change to the period custodian fees was offset against the period expense waivers/reimbursements with no impact to net expenses or net investment income (loss). |
# | The Portfolio received settlement proceeds from a foreign exchange trading class action lawsuit. The proceeds from the settlement represented a realized gain and were recorded in the period received. There was a 0.07% impact on the total return of the Portfolio’s Open Shares. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
178 Semi-Annual Report
LAZARD EMERGING MARKETS CORE EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.89 | $ | 12.30 | $ | 8.83 | $ | 8.60 | $ | 9.62 | $ | 9.83 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.16 | 0.11 | 0.08 | 0.03 | 0.03 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.11 | (2.39 | ) | 3.45 | 0.22 | (1.03 | ) | (0.15 | ) | |||||||||||||||
Total from investment operations | 1.22 | (2.23 | ) | 3.56 | 0.30 | (1.00 | ) | (0.12 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.18 | ) | (0.09 | ) | (0.07 | ) | (0.01 | ) | (0.08 | ) | |||||||||||||
Return of capital | — | — | — | — | (0.01 | ) | (0.01 | ) | ||||||||||||||||
Total distributions | — | (0.18 | ) | (0.09 | ) | (0.07 | ) | (0.02 | ) | (0.09 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | ||||||||||||||||
Net asset value, end of period | $ | 11.11 | $ | 9.89 | $ | 12.30 | $ | 8.83 | $ | 8.60 | $ | 9.62 | ||||||||||||
Total Return (c) | 12.34 | % | –18.12 | % | 40.35 | % | 3.47 | % | –10.36 | % | –1.25 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 229,254 | $ | 207,955 | $ | 230,343 | $ | 122,995 | $ | 102,421 | $ | 39,832 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.16 | % | 1.18 | % | 1.20 | % | 1.30 | % | 1.30 | % | 1.30 | % | ||||||||||||
Gross expenses | 1.16 | % | 1.18 | % | 1.20 | % | 1.31 | % | 1.52 | % | 2.28 | % | ||||||||||||
Net investment income (loss) | 2.04 | % | 1.44 | % | 0.98 | % | 0.89 | % | 0.32 | % | 0.28 | % | ||||||||||||
Portfolio turnover rate | 11 | % | 30 | % | 15 | % | 62 | % | 46 | % | 45 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 179
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.87 | $ | 12.27 | $ | 8.81 | $ | 8.58 | $ | 9.62 | $ | 9.83 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.11 | 0.06 | 0.07 | — | (b) | (0.04 | ) | ||||||||||||||||
Net realized and unrealized gain (loss) | 1.09 | (2.37 | ) | 3.45 | 0.20 | (1.04 | ) | (0.11 | ) | |||||||||||||||
Total from investment operations | 1.19 | (2.26 | ) | 3.51 | 0.27 | (1.04 | ) | (0.15 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.14 | ) | (0.05 | ) | (0.04 | ) | — | (0.05 | ) | ||||||||||||||
Return of capital | — | — | — | — | — | (0.01 | ) | |||||||||||||||||
Total distributions | — | (0.14 | ) | (0.05 | ) | (0.04 | ) | — | (0.06 | ) | ||||||||||||||
Redemption fees | — | — | — | — | — | — | (b) | |||||||||||||||||
Net asset value, end of period | $ | 11.06 | $ | 9.87 | $ | 12.27 | $ | 8.81 | $ | 8.58 | $ | 9.62 | ||||||||||||
Total Return (c) | 12.06 | % | –18.43 | % | 39.80 | % | 3.17 | % | –10.81 | % | –1.56 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 2,209 | $ | 1,853 | $ | 1,828 | $ | 729 | $ | 2,344 | $ | 5,266 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.55 | % | 1.58 | % | 1.60 | % | 1.60 | % | 1.60 | % | 1.60 | % | ||||||||||||
Gross expenses | 1.55 | % | 2.00 | % | 2.45 | % | 2.14 | % | 2.35 | % | 2.81 | % | ||||||||||||
Net investment income (loss) | 1.79 | % | 1.00 | % | 0.56 | % | 0.85 | % | –0.04 | % | –0.35 | % | ||||||||||||
Portfolio turnover rate | 11 | % | 30 | % | 15 | % | 62 | % | 46 | % | 45 | % |
The accompanying notes are an integral part of these financial statements.
180 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | For the Period 4/6/18* to 12/31/18 | ||||||||||||||||||||||
R6 Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.89 | $ | 12.21 | ||||||||||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.14 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) | 1.12 | (2.28 | ) | |||||||||||||||||||||
Total from investment operations | 1.23 | (2.14 | ) | |||||||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.18 | ) | |||||||||||||||||||||
Total distributions | — | (0.18 | ) | |||||||||||||||||||||
Net asset value, end of period | $ | 11.12 | $ | 9.89 | ||||||||||||||||||||
Total Return (c) | 12.44 | % | –17.52 | % | ||||||||||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 532 | $ | 494 | ||||||||||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.17 | % | 1.16 | % | ||||||||||||||||||||
Gross expenses | 2.26 | % | 7.68 | % | ||||||||||||||||||||
Net investment income (loss) | 2.03 | % | 1.71 | % | ||||||||||||||||||||
Portfolio turnover rate | 11 | % | 30 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was April 6, 2018. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 181
LAZARD EMERGING MARKETS EQUITY ADVANTAGE PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Institutional Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 10.03 | $ | 12.27 | $ | 8.71 | $ | 8.06 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.12 | 0.19 | 0.12 | 0.12 | 0.08 | |||||||||||||||
Net realized and unrealized gain (loss) | 1.07 | (2.19 | ) | 3.58 | 0.67 | (1.88 | ) | |||||||||||||
Total from investment operations | 1.19 | (2.00 | ) | 3.70 | 0.79 | (1.80 | ) | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.22 | ) | (0.13 | ) | (0.13 | ) | (0.14 | ) | |||||||||||
Net realized gains | — | (— | )(b) | — | — | — | ||||||||||||||
Return of capital | — | (0.02 | ) | (0.01 | ) | (0.01 | ) | — | ||||||||||||
Total distributions | — | (0.24 | ) | (0.14 | ) | (0.14 | ) | (0.14 | ) | |||||||||||
Net asset value, end of period | $ | 11.22 | $ | 10.03 | $ | 12.27 | $ | 8.71 | $ | 8.06 | ||||||||||
Total Return (c) | 11.86 | % | –16.23 | % | 42.52 | % | 9.83 | % | –17.97 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 8,956 | $ | 3,107 | $ | 4,191 | $ | 2,896 | $ | 2,618 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||
Net expenses | 1.10 | % | 1.10 | % | 1.10 | % | 1.10 | % | 1.10 | % | ||||||||||
Gross expenses | 3.24 | % | 5.60 | % | 6.29 | % | 9.57 | % | 11.47 | % | ||||||||||
Net investment income (loss) | 2.26 | % | 1.59 | % | 1.15 | % | 1.41 | % | 1.54 | % | ||||||||||
Portfolio turnover rate | 29 | % | 61 | % | 52 | % | 57 | % | 38 | % |
The accompanying notes are an integral part of these financial statements.
182 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Open Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 10.04 | $ | 12.27 | $ | 8.71 | $ | 8.06 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.16 | 0.08 | 0.09 | 0.06 | |||||||||||||||
Net realized and unrealized gain (loss) | 1.06 | (2.18 | ) | 3.58 | 0.68 | (1.87 | ) | |||||||||||||
Total from investment operations | 1.17 | (2.02 | ) | 3.66 | 0.77 | (1.81 | ) | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.19 | ) | (0.09 | ) | (0.11 | ) | (0.13 | ) | |||||||||||
Net realized gains | — | — | (b) | — | — | — | ||||||||||||||
Return of capital | — | (0.02 | ) | (0.01 | ) | (0.01 | ) | — | ||||||||||||
Total distributions | — | (0.21 | ) | (0.10 | ) | (0.12 | ) | (0.13 | ) | |||||||||||
Net asset value, end of period | $ | 11.21 | $ | 10.04 | $ | 12.27 | $ | 8.71 | $ | 8.06 | ||||||||||
Total Return (c) | 11.65 | % | –16.40 | % | 42.09 | % | 9.51 | % | –18.13 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,144 | $ | 476 | $ | 356 | $ | 120 | $ | 95 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||
Net expenses | 1.40 | % | 1.40 | % | 1.40 | % | 1.40 | % | 1.40 | % | ||||||||||
Gross expenses | 3.76 | % | 8.09 | % | 12.17 | % | 20.02 | % | 26.37 | % | ||||||||||
Net investment income (loss) | 1.94 | % | 1.35 | % | 0.72 | % | 1.06 | % | 1.18 | % | ||||||||||
Portfolio turnover rate | 29 | % | 61 | % | 52 | % | 57 | % | 38 | % |
† | Unaudited. |
* | The Portfolio commenced operations on May 29, 2015. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 183
LAZARD EMERGING MARKETS EQUITY BLEND PORTFOLIO
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.02 | $ | 12.93 | $ | 9.60 | $ | 8.53 | $ | 10.00 | $ | 11.18 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.07 | 0.17 | 0.10 | 0.08 | ^ | 0.12 | 0.15 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.42 | (2.89 | ) | 3.35 | 1.04 | (1.39 | ) | (1.12 | ) | |||||||||||||||
Total from investment operations | 1.49 | (2.72 | ) | 3.45 | 1.12 | (1.27 | ) | (0.97 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.19 | ) | (0.12 | ) | (0.05 | ) | (0.19 | ) | (0.21 | ) | |||||||||||||
Return of capital | — | — | — | — | (0.01 | ) | — | (b) | ||||||||||||||||
Total distributions | — | (0.19 | ) | (0.12 | ) | (0.05 | ) | (0.20 | ) | (0.21 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 11.51 | $ | 10.02 | $ | 12.93 | $ | 9.60 | $ | 8.53 | $ | 10.00 | ||||||||||||
Total Return(c) | 14.87 | % | –21.05 | % | 35.98 | % | 13.12 | %^ | –12.74 | % | –8.66 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 92,241 | $ | 291,404 | $ | 385,492 | $ | 282,473 | $ | 287,857 | $ | 463,043 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.15 | % | 1.15 | % | 1.21 | % | 1.25 | %^ | 1.20 | % | 1.28 | % | ||||||||||||
Gross expenses | 1.15 | % | 1.15 | % | 1.21 | % | 1.26 | % | 1.20 | % | 1.28 | % | ||||||||||||
Net investment income (loss) | 1.22 | % | 1.39 | % | 0.90 | % | 0.88 | %^ | 1.22 | % | 1.33 | % | ||||||||||||
Portfolio turnover rate | 31 | % | 61 | % | 57 | % | 47 | % | 38 | % | 44 | % |
The accompanying notes are an integral part of these financial statements.
184 Semi-Annual Report
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.03 | $ | 12.95 | $ | 9.62 | $ | 8.55 | $ | 9.99 | $ | 11.17 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.08 | 0.12 | 0.06 | 0.05 | ^ | 0.11 | 0.10 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.41 | (2.89 | ) | 3.34 | 1.04 | (1.38 | ) | (1.10 | ) | |||||||||||||||
Total from investment operations | 1.49 | (2.77 | ) | 3.40 | 1.09 | (1.27 | ) | (1.00 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.15 | ) | (0.07 | ) | (0.02 | ) | (0.17 | ) | (0.18 | ) | |||||||||||||
Return of capital | — | — | — | — | — | (b) | — | (b) | ||||||||||||||||
Total distributions | — | (0.15 | ) | (0.07 | ) | (0.02 | ) | (0.17 | ) | (0.18 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 11.52 | $ | 10.03 | $ | 12.95 | $ | 9.62 | $ | 8.55 | $ | 9.99 | ||||||||||||
Total Return(c) | 14.86 | % | –21.39 | % | 35.38 | % | 12.74 | %^ | –12.77 | % | –8.95 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 6,531 | $ | 6,200 | $ | 9,728 | $ | 6,804 | $ | 7,107 | $ | 123,756 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.43 | % | 1.53 | % | 1.60 | % | 1.60 | %^ | 1.54 | % | 1.60 | % | ||||||||||||
Gross expenses | 1.43 | % | 1.53 | % | 1.61 | % | 1.89 | % | 1.54 | % | 1.63 | % | ||||||||||||
Net investment income (loss) | 1.52 | % | 1.01 | % | 0.50 | % | 0.54 | %^ | 1.10 | % | 0.94 | % | ||||||||||||
Portfolio turnover rate | 31 | % | 61 | % | 57 | % | 47 | % | 38 | % | 44 | % | ||||||||||||
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 185
LAZARD EMERGING MARKETS EQUITY PORTFOLIO
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 16.06 | $ | 20.02 | $ | 15.96 | $ | 13.44 | $ | 17.19 | $ | 18.67 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.21 | 0.39 | 0.33 | 0.24 | ^ | 0.30 | 0.37 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.46 | (4.01 | ) | 4.13 | 2.52 | (3.76 | ) | (1.13 | ) | |||||||||||||||
Total from investment operations | 1.67 | (3.62 | ) | 4.46 | 2.76 | (3.46 | ) | (0.76 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.34 | ) | (0.40 | ) | (0.24 | ) | (0.23 | ) | (0.37 | ) | |||||||||||||
Net realized gains | — | — | — | — | (0.06 | ) | (0.35 | ) | ||||||||||||||||
Total distributions | — | (0.34 | ) | (0.40 | ) | (0.24 | ) | (0.29 | ) | (0.72 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 17.73 | $ | 16.06 | $ | 20.02 | $ | 15.96 | $ | 13.44 | $ | 17.19 | ||||||||||||
Total Return(c) | 10.40 | % | –18.09 | % | 28.02 | % | 20.52 | %^ | –20.16 | % | –4.16 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 7,134,436 | $ | 7,573,861 | $ | 11,285,358 | $ | 9,311,693 | $ | 8,238,638 | $ | 12,156,645 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.08 | % | 1.07 | % | 1.08 | % | 1.09 | %^ | 1.10 | % | 1.09 | % | ||||||||||||
Gross expenses | 1.08 | % | 1.07 | % | 1.08 | % | 1.09 | % | 1.10 | % | 1.09 | % | ||||||||||||
Net investment income (loss) | 2.41 | % | 2.12 | % | 1.82 | % | 1.59 | %^ | 1.83 | % | 1.97 | % | ||||||||||||
Portfolio turnover rate | 9 | % | 16 | % | 14 | % | 12 | % | 14 | % | 12 | % |
The accompanying notes are an integral part of these financial statements.
186 Semi-Annual Report
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 16.53 | $ | 20.60 | $ | 16.41 | $ | 13.82 | $ | 17.65 | $ | 19.14 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.35 | 0.29 | 0.21 | ^ | 0.26 | 0.34 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.51 | (4.12 | ) | 4.25 | 2.58 | (3.84 | ) | (1.16 | ) | |||||||||||||||
Total from investment operations | 1.70 | (3.77 | ) | 4.54 | 2.79 | (3.58 | ) | (0.82 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.30 | ) | (0.35 | ) | (0.20 | ) | (0.19 | ) | (0.32 | ) | |||||||||||||
Net realized gains | — | — | — | — | (0.06 | ) | (0.35 | ) | ||||||||||||||||
Total distributions | — | (0.30 | ) | (0.35 | ) | (0.20 | ) | (0.25 | ) | (0.67 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 18.23 | $ | 16.53 | $ | 20.60 | $ | 16.41 | $ | 13.82 | $ | 17.65 | ||||||||||||
Total Return (c) | 10.28 | % | –18.32 | % | 27.73 | % | 20.17 | %^ | –20.33 | % | –4.39 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,034,365 | $ | 1,004,569 | $ | 1,515,715 | $ | 1,287,552 | $ | 832,706 | $ | 1,474,597 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.33 | % | 1.32 | % | 1.34 | % | 1.35 | %^ | 1.37 | % | 1.37 | % | ||||||||||||
Gross expenses | 1.33 | % | 1.32 | % | 1.34 | % | 1.35 | % | 1.37 | % | 1.37 | % | ||||||||||||
Net investment income (loss) | 2.18 | % | 1.85 | % | 1.55 | % | 1.35 | %^ | 1.58 | % | 1.76 | % | ||||||||||||
Portfolio turnover rate | 9 | % | 16 | % | 14 | % | 12 | % | 14 | % | 12 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 187
Selected data for a share | Six Months | For the Period | ||||||||||||||||||
of capital stock outstanding | Ended | Year Ended | 1/19/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
R6 Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 16.06 | $ | 20.02 | $ | 15.96 | $ | 13.44 | $ | 17.26 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.40 | 0.35 | 0.23 | ^ | 0.27 | ||||||||||||||
Net realized and unrealized gain (loss) | 1.48 | (4.02 | ) | 4.11 | 2.53 | (3.80 | ) | |||||||||||||
Total from investment operations | 1.67 | (3.62 | ) | 4.46 | 2.76 | (3.53 | ) | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.34 | ) | (0.40 | ) | (0.24 | ) | (0.23 | ) | |||||||||||
Net realized gains | — | — | — | — | (0.06 | ) | ||||||||||||||
Total distributions | — | (0.34 | ) | (0.40 | ) | (0.24 | ) | (0.29 | ) | |||||||||||
Net asset value, end of period | $ | 17.73 | $ | 16.06 | $ | 20.02 | $ | 15.96 | $ | 13.44 | ||||||||||
Total Return (c) | 10.40 | % | –18.09 | % | 28.02 | % | 20.52 | %^ | –20.50 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 180,814 | $ | 232,507 | $ | 372,568 | $ | 197,959 | $ | 144,626 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||
Net expenses | 1.08 | % | 1.07 | % | 1.08 | % | 1.09 | %^ | 1.12 | % | ||||||||||
Gross expenses | 1.08 | % | 1.07 | % | 1.08 | % | 1.10 | % | 1.13 | % | ||||||||||
Net investment income (loss) | 2.22 | % | 2.15 | % | 1.91 | % | 1.54 | %^ | 1.79 | % | ||||||||||
Portfolio turnover rate | 9 | % | 16 | % | 14 | % | 12 | % | 14 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was January 19, 2015. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
188 Semi-Annual Report
LAZARD EQUITY FRANCHISE PORTFOLIO
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | Year Ended 12/31/18 | For the Period 9/29/17* to 12/31/17 | ||||||||||
Institutional Shares | |||||||||||||
Net asset value, beginning of period | $ | 8.84 | $ | 10.38 | $ | 10.00 | |||||||
Income (Loss) from investment operations: | |||||||||||||
Net investment income (loss) (a) | 0.18 | 0.20 | 0.03 | ||||||||||
Net realized and unrealized gain (loss) | 0.96 | (0.75 | ) | 0.40 | |||||||||
Total from investment operations | 1.14 | (0.55 | ) | 0.43 | |||||||||
Less distributions from: | |||||||||||||
Net investment income | — | (0.21 | ) | (0.03 | ) | ||||||||
Net realized gains | — | (0.78 | ) | (0.02 | ) | ||||||||
Total distributions | — | (0.99 | ) | (0.05 | ) | ||||||||
Net asset value, end of period | $ | 9.98 | $ | 8.84 | $ | 10.38 | |||||||
Total Return (b) | 12.90 | % | –5.10 | % | 4.25 | % | |||||||
Ratios and Supplemental Data: | |||||||||||||
Net assets, end of period (in thousands) | $ | 36,858 | $ | 8,341 | $ | 5,566 | |||||||
Ratios to average net assets (c): | |||||||||||||
Net expenses | 0.95 | % | 0.95 | % | 0.95 | % | |||||||
Gross expenses | 1.63 | % | 3.42 | % | 3.21 | % | |||||||
Net investment income (loss) | 3.92 | % | 1.94 | % | 1.26 | % | |||||||
Portfolio turnover rate | 56 | % | 97 | % | 10 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 189
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | Year Ended 12/31/18 | For the Period 9/29/17* to 12/31/17 | ||||||||||
Open Shares | |||||||||||||
Net asset value, beginning of period | $ | 8.84 | $ | 10.38 | $ | 10.00 | |||||||
Income (Loss) from investment operations: | |||||||||||||
Net investment income (loss) (a) | 0.12 | 0.19 | 0.03 | ||||||||||
Net realized and unrealized gain (loss) | 1.00 | (0.77 | ) | 0.39 | |||||||||
Total from investment operations | 1.12 | (0.58 | ) | 0.42 | |||||||||
Less distributions from: | |||||||||||||
Net investment income | — | (0.18 | ) | (0.02 | ) | ||||||||
Net realized gains | — | (0.78 | ) | (0.02 | ) | ||||||||
Total distributions | — | (0.96 | ) | (0.04 | ) | ||||||||
Net asset value, end of period | $ | 9.96 | $ | 8.84 | $ | 10.38 | |||||||
Total Return (b) | 12.67 | % | –5.34 | % | 4.18 | % | |||||||
Ratios and Supplemental Data: | |||||||||||||
Net assets, end of period (in thousands) | $ | 225 | $ | 190 | $ | 111 | |||||||
Ratios to average net assets (c): | |||||||||||||
Net expenses | 1.20 | % | 1.20 | % | 1.20 | % | |||||||
Gross expenses | 3.38 | % | 10.19 | % | 23.62 | % | |||||||
Net investment income (loss) | 2.49 | % | 1.75 | % | 1.14 | % | |||||||
Portfolio turnover rate | 56 | % | 97 | % | 10 | % |
† | Unaudited. |
* | The Portfolio commenced operations on September 29, 2017. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
190 Semi-Annual Report
LAZARD GLOBAL EQUITY SELECT PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 11.72 | $ | 13.04 | $ | 10.53 | $ | 10.33 | $ | 10.32 | $ | 10.02 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.08 | 0.09 | 0.07 | 0.09 | 0.04 | 0.07 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 2.11 | (1.02 | ) | 2.93 | 0.18 | 0.01 | 0.29 | |||||||||||||||||
Total from investment operations | 2.19 | (0.93 | ) | 3.00 | 0.27 | 0.05 | 0.36 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.06 | ) | (0.10 | ) | (0.07 | ) | (0.04 | ) | (0.06 | ) | |||||||||||||
Net realized gains | — | (0.32 | ) | (0.39 | ) | — | — | — | ||||||||||||||||
Return of capital | — | (0.01 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (0.39 | ) | (0.49 | ) | (0.07 | ) | (0.04 | ) | (0.06 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 13.91 | $ | 11.72 | $ | 13.04 | $ | 10.53 | $ | 10.33 | $ | 10.32 | ||||||||||||
Total Return (c) | 18.69 | % | –7.12 | % | 28.52 | % | 2.66 | % | 0.46 | % | 3.84 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 70,531 | $ | 65,382 | $ | 58,201 | $ | 31,197 | $ | 20,624 | $ | 12,266 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.05 | % | 1.05 | % | 1.05 | % | 1.07 | % | 1.10 | % | 1.10 | % | ||||||||||||
Gross expenses | 1.06 | % | 1.08 | % | 1.30 | % | 1.75 | % | 2.27 | % | 4.62 | % | ||||||||||||
Net investment income (loss) | 1.31 | % | 0.70 | % | 0.60 | % | 0.86 | % | 0.41 | % | 0.64 | % | ||||||||||||
Portfolio turnover rate | 14 | % | 34 | % | 34 | % | 40 | % | 55 | % | 64 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 191
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 11.73 | $ | 13.04 | $ | 10.54 | $ | 10.34 | $ | 10.32 | $ | 10.01 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.07 | 0.05 | 0.04 | 0.06 | 0.01 | 0.04 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 2.10 | (1.01 | ) | 2.91 | 0.18 | 0.02 | 0.30 | |||||||||||||||||
Total from investment operations | 2.17 | (0.96 | ) | 2.95 | 0.24 | 0.03 | 0.34 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.02 | ) | (0.06 | ) | (0.04 | ) | (0.01 | ) | (0.03 | ) | |||||||||||||
Net realized gains | — | (0.32 | ) | (0.39 | ) | — | — | — | ||||||||||||||||
Return of capital | — | (0.01 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (0.35 | ) | (0.45 | ) | (0.04 | ) | (0.01 | ) | (0.03 | ) | |||||||||||||
Net asset value, end of period | $ | 13.90 | $ | 11.73 | $ | 13.04 | $ | 10.54 | $ | 10.34 | $ | 10.32 | ||||||||||||
Total Return (c) | 18.50 | % | –7.33 | % | 28.01 | % | 2.35 | % | 0.24 | % | 3.54 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,005 | $ | 763 | $ | 711 | $ | 515 | $ | 290 | $ | 201 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.35 | % | 1.35 | % | 1.35 | % | 1.37 | % | 1.40 | % | 1.40 | % | ||||||||||||
Gross expenses | 1.66 | % | 2.80 | % | 3.70 | % | 5.38 | % | 7.42 | % | 13.34 | % | ||||||||||||
Net investment income (loss) | 1.02 | % | 0.41 | % | 0.32 | % | 0.56 | % | 0.09 | % | 0.35 | % | ||||||||||||
Portfolio turnover rate | 14 | % | 34 | % | 34 | % | 40 | % | 55 | % | 64 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
192 Semi-Annual Report
LAZARD GLOBAL LISTED INFRASTRUCTURE PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.51 | $ | 15.99 | $ | 14.17 | $ | 13.42 | $ | 13.72 | $ | 13.13 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.30 | 0.41 | 0.39 | 0.31 | ^ | 0.33 | 0.34 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.64 | (0.96 | ) | 2.54 | 0.92 | 0.89 | 2.01 | |||||||||||||||||
Total from investment operations | 1.94 | (0.55 | ) | 2.93 | 1.23 | 1.22 | 2.35 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.18 | ) | (0.72 | ) | (0.29 | ) | (0.34 | ) | (1.17 | ) | (1.04 | ) | ||||||||||||
Net realized gains | — | (1.21 | ) | (0.82 | ) | (0.14 | ) | (0.35 | ) | (0.72 | ) | |||||||||||||
Total distributions | (0.18 | ) | (1.93 | ) | (1.11 | ) | (0.48 | ) | (1.52 | ) | (1.76 | ) | ||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 15.27 | $ | 13.51 | $ | 15.99 | $ | 14.17 | $ | 13.42 | $ | 13.72 | ||||||||||||
Total Return (c) | 14.38 | % | –3.68 | % | 20.73 | % | 9.30 | %^ | 9.30 | % | 17.95 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 6,248,530 | $ | 4,924,359 | $ | 4,778,042 | $ | 2,931,161 | $ | 2,156,325 | $ | 1,372,216 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.94 | % | 0.95 | % | 0.95 | % | 0.96 | %^ | 0.96 | % | 0.98 | % | ||||||||||||
Gross expenses | 0.94 | % | 0.95 | % | 0.95 | % | 0.96 | % | 0.96 | % | 0.98 | % | ||||||||||||
Net investment income (loss) | 4.09 | % | 2.65 | % | 2.44 | % | 2.29 | %^ | 2.32 | % | 2.35 | % | ||||||||||||
Portfolio turnover rate | 19 | % | 49 | % | 33 | % | 35 | % | 34 | % | 41 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 193
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.52 | $ | 16.01 | $ | 14.20 | $ | 13.45 | $ | 13.74 | $ | 13.15 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.27 | 0.37 | 0.35 | 0.29 | ^ | 0.31 | 0.29 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.66 | (0.97 | ) | 2.55 | 0.91 | 0.88 | 2.02 | |||||||||||||||||
Total from investment operations | 1.93 | (0.60 | ) | 2.90 | 1.20 | 1.19 | 2.31 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.16 | ) | (0.68 | ) | (0.27 | ) | (0.31 | ) | (1.13 | ) | (1.00 | ) | ||||||||||||
Net realized gains | — | (1.21 | ) | (0.82 | ) | (0.14 | ) | (0.35 | ) | (0.72 | ) | |||||||||||||
Total distributions | (0.16 | ) | (1.89 | ) | (1.09 | ) | (0.45 | ) | (1.48 | ) | (1.72 | ) | ||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 15.29 | $ | 13.52 | $ | 16.01 | $ | 14.20 | $ | 13.45 | $ | 13.74 | ||||||||||||
Total Return (c) | 14.30 | % | –3.98 | % | 20.47 | % | 9.01 | %^ | 9.06 | % | 17.61 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 482,217 | $ | 426,749 | $ | 633,243 | $ | 462,613 | $ | 393,786 | $ | 145,901 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.20 | % | 1.20 | % | 1.21 | % | 1.22 | %^ | 1.23 | % | 1.29 | % | ||||||||||||
Gross expenses | 1.20 | % | 1.20 | % | 1.21 | % | 1.22 | % | 1.23 | % | 1.29 | % | ||||||||||||
Net investment income (loss) | 3.71 | % | 2.36 | % | 2.16 | % | 2.09 | %^ | 2.19 | % | 2.04 | % | ||||||||||||
Portfolio turnover rate | 19 | % | 49 | % | 33 | % | 35 | % | 34 | % | 41 | % |
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
194 Semi-Annual Report
LAZARD GLOBAL STRATEGIC EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 8/29/14* to | |||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 1.64 | $ | 2.31 | $ | 9.59 | $ | 9.67 | $ | 9.94 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.01 | 0.01 | 0.08 | 0.07 | 0.06 | — | (b) | |||||||||||||||||
Net realized and unrealized gain (loss) | 0.30 | (0.18 | ) | 2.24 | (0.08 | ) | (0.25 | ) | (0.04 | ) | ||||||||||||||
Total from investment operations | 0.31 | (0.17 | ) | 2.32 | (0.01 | ) | (0.19 | ) | (0.04 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.01 | ) | (0.20 | ) | (0.07 | ) | (0.08 | ) | (0.02 | ) | |||||||||||||
Net realized gains | — | (0.49 | ) | (9.40 | ) | — | — | — | ||||||||||||||||
Return of capital | — | — | — | — | — | — | (b) | |||||||||||||||||
Total distributions | — | (0.50 | ) | (9.60 | ) | (0.07 | ) | (0.08 | ) | (0.02 | ) | |||||||||||||
Net asset value, end of period | $ | 1.95 | $ | 1.64 | $ | 2.31 | $ | 9.59 | $ | 9.67 | $ | 9.94 | ||||||||||||
Total Return (c) | 18.90 | % | –9.16 | % | 24.20 | % | –0.15 | % | –1.85 | % | –0.36 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 2,935 | $ | 2,505 | $ | 2,750 | $ | 19,816 | $ | 9,254 | $ | 7,112 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.00 | % | 1.05 | % | 1.10 | % | 1.10 | % | 1.10 | % | 1.10 | % | ||||||||||||
Gross expenses | 6.17 | % | 6.41 | % | 2.06 | % | 2.03 | % | 3.83 | % | 7.11 | % | ||||||||||||
Net investment income (loss) | 0.92 | % | 0.60 | % | 0.76 | % | 0.76 | % | 0.63 | % | –0.08 | % | ||||||||||||
Portfolio turnover rate | 22 | % | 46 | % | 65 | % | 67 | % | 65 | % | 24 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 195
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 8/29/14* to | |||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 1.63 | $ | 2.30 | $ | 9.59 | $ | 9.67 | $ | 9.94 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.01 | 0.01 | 0.03 | 0.04 | 0.03 | (0.01 | ) | |||||||||||||||||
Net realized and unrealized gain (loss) | 0.30 | (0.19 | ) | 2.25 | (0.08 | ) | (0.25 | ) | (0.04 | ) | ||||||||||||||
Total from investment operations | 0.31 | (0.18 | ) | 2.28 | (0.04 | ) | (0.22 | ) | (0.05 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | — | (b) | (0.17 | ) | (0.04 | ) | (0.05 | ) | (0.01 | ) | |||||||||||||
Net realized gains | — | (0.49 | ) | (9.40 | ) | — | — | — | ||||||||||||||||
Return of capital | — | — | — | — | — | — | (b) | |||||||||||||||||
Total distributions | — | (0.49 | ) | (9.57 | ) | (0.04 | ) | (0.05 | ) | (0.01 | ) | |||||||||||||
Net asset value, end of period | $ | 1.94 | $ | 1.63 | $ | 2.30 | $ | 9.59 | $ | 9.67 | $ | 9.94 | ||||||||||||
Total Return (c) | 19.02 | % | –9.39 | % | 23.72 | % | –0.45 | % | –2.16 | % | –0.46 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 143 | $ | 131 | $ | 149 | $ | 114 | $ | 114 | $ | 135 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.30 | % | 1.35 | % | 1.41 | % | 1.40 | % | 1.40 | % | 1.40 | % | ||||||||||||
Gross expenses | 8.30 | % | 14.05 | % | 12.33 | % | 13.31 | % | 14.12 | % | 24.52 | % | ||||||||||||
Net investment income (loss) | 0.63 | % | 0.29 | % | 0.34 | % | 0.39 | % | 0.30 | % | –0.32 | % | ||||||||||||
Portfolio turnover rate | 22 | % | 46 | % | 65 | % | 67 | % | 65 | % | 24 | % |
† | Unaudited. |
* | The Portfolio commenced operations on August 29, 2014. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
196 Semi-Annual Report
LAZARD INTERNATIONAL QUALITY GROWTH PORTFOLIO
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | For the Period 12/31/18* | ||||||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.98 | $ | 10.00 | ||||||||||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.08 | — | ||||||||||||||||||||||
Net realized and unrealized gain (loss) | 1.97 | (0.02 | ) | |||||||||||||||||||||
Total from investment operations | 2.05 | (0.02 | ) | |||||||||||||||||||||
Net asset value, end of period | $ | 12.03 | $ | 9.98 | ||||||||||||||||||||
Total Return (b) | 20.30 | % | –0.20 | % | ||||||||||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 3,617 | $ | 149 | ||||||||||||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||||||
Net expenses | 0.85 | % | 0.00 | % | ||||||||||||||||||||
Gross expenses | 6.37 | % | 8.45 | % | ||||||||||||||||||||
Net investment income (loss) | 1.45 | % | 0.00 | % | ||||||||||||||||||||
Portfolio turnover rate | 131 | % | — | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 197
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | For the Period 12/31/18* | ||||||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.00 | $ | 10.00 | ||||||||||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.09 | — | ||||||||||||||||||||||
Net realized and unrealized gain (loss) | 1.91 | — | (d) | |||||||||||||||||||||
Total from investment operations | 2.00 | — | (d) | |||||||||||||||||||||
Net asset value, end of period | $ | 12.00 | $ | 10.00 | ||||||||||||||||||||
Total Return (b) | 20.00 | % | 0.00 | % | ||||||||||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 5 | $ | 1 | ||||||||||||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||||||
Net expenses | 1.08 | % | 0.00 | % | ||||||||||||||||||||
Gross expenses | 152.22 | % | 0.40 | % | ||||||||||||||||||||
Net investment income (loss) | 1.71 | % | 0.00 | % | ||||||||||||||||||||
Portfolio turnover rate | 131 | % | — | % |
† | Unaudited. |
* | The Portfolio commenced operations on December 31, 2018. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year except for non-recurring expenses. |
(d) | Amount is less than $0.01 per share. |
The accompanying notes are an integral part of these financial statements.
198 Semi-Annual Report
LAZARD INTERNATIONAL EQUITY ADVANTAGE PORTFOLIO | ||||||||||||||||||||
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Institutional Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 8.70 | $ | 10.92 | $ | 8.91 | $ | 9.21 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.16 | 0.24 | 0.19 | 0.18 | 0.04 | |||||||||||||||
Net realized and unrealized gain (loss) | 0.84 | (2.01 | ) | 2.03 | (0.28 | ) | (0.70 | ) | ||||||||||||
Total from investment operations | 1.00 | (1.77 | ) | 2.22 | (0.10 | ) | (0.66 | ) | ||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.33 | ) | (0.21 | ) | (0.20 | ) | (0.13 | ) | |||||||||||
Net realized gains | — | (0.12 | ) | — | — | — | ||||||||||||||
Total distributions | — | (0.45 | ) | (0.21 | ) | (0.20 | ) | (0.13 | ) | |||||||||||
Net asset value, end of period | $ | 9.70 | $ | 8.70 | $ | 10.92 | $ | 8.91 | $ | 9.21 | ||||||||||
Total Return (b) | 11.49 | % | –16.26 | % | 24.98 | % | –1.13 | % | –6.63 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 2,289 | $ | 2,051 | $ | 2,508 | $ | 1,969 | $ | 1,797 | ||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||
Net expenses | 0.90 | % | 0.90 | % | 0.90 | % | 0.90 | % | 0.90 | % | ||||||||||
Gross expenses | 8.19 | % | 7.60 | % | 8.91 | % | 13.12 | % | 14.93 | % | ||||||||||
Net investment income (loss) | 3.42 | % | 2.29 | % | 1.89 | % | 2.08 | % | 0.77 | % | ||||||||||
Portfolio turnover rate | 32 | % | 72 | % | 88 | % | 92 | % | 58 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 199
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Open Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 8.70 | $ | 10.92 | $ | 8.91 | $ | 9.21 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.15 | 0.21 | 0.16 | 0.15 | 0.03 | |||||||||||||||
Net realized and unrealized gain (loss) | 0.84 | (2.01 | ) | 2.03 | (0.28 | ) | (0.71 | ) | ||||||||||||
Total from investment operations | 0.99 | (1.80 | ) | 2.19 | (0.13 | ) | (0.68 | ) | ||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.30 | ) | (0.18 | ) | (0.17 | ) | (0.11 | ) | |||||||||||
Net realized gains | — | (0.12 | ) | — | — | — | ||||||||||||||
Total distributions | — | (0.42 | ) | (0.18 | ) | (0.17 | ) | (0.11 | ) | |||||||||||
Net asset value, end of period | $ | 9.69 | $ | 8.70 | $ | 10.92 | $ | 8.91 | $ | 9.21 | ||||||||||
Total Return (b) | 11.38 | % | –16.52 | % | 24.60 | % | –1.42 | % | –6.80 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 108 | $ | 97 | $ | 116 | $ | 93 | $ | 93 | ||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||
Net expenses | 1.20 | % | 1.20 | % | 1.20 | % | 1.20 | % | 1.20 | % | ||||||||||
Gross expenses | 10.94 | % | 17.67 | % | 20.85 | % | 25.85 | % | 30.10 | % | ||||||||||
Net investment income (loss) | 3.12 | % | 1.99 | % | 1.58 | % | 1.74 | % | 0.47 | % | ||||||||||
Portfolio turnover rate | 32 | % | 72 | % | 88 | % | 92 | % | 58 | % |
† | Unaudited. |
* | The Portfolio commenced operations on May 29, 2015. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
200 Semi-Annual Report
LAZARD INTERNATIONAL EQUITY CONCENTRATED PORTFOLIO | ||||||||||||||||||||||||
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 8/29/14* to | |||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.34 | $ | 10.43 | $ | 8.54 | $ | 8.27 | $ | 9.53 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.14 | 0.13 | 0.14 | 0.10 | (0.01 | ) | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.31 | (1.84 | ) | 1.86 | 0.25 | (1.25 | ) | (0.45 | ) | |||||||||||||||
Total from investment operations | 1.50 | (1.70 | ) | 1.99 | 0.39 | (1.15 | ) | (0.46 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.17 | ) | (0.10 | ) | (0.12 | ) | (0.11 | ) | (0.01 | ) | |||||||||||||
Net realized gains | — | (0.22 | ) | — | — | — | — | (b) | ||||||||||||||||
Total distributions | — | (0.39 | ) | (0.10 | ) | (0.12 | ) | (0.11 | ) | (0.01 | ) | |||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | |||||||||||||||||
Net asset value, end of period | $ | 9.84 | $ | 8.34 | $ | 10.43 | $ | 8.54 | $ | 8.27 | $ | 9.53 | ||||||||||||
Total Return (c) | 17.99 | % | –16.20 | % | 23.29 | % | 4.74 | % | –12.06 | % | –4.60 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 87,136 | $ | 49,105 | $ | 69,440 | �� | $ | 15,473 | $ | 13,753 | $ | 9,103 | |||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.95 | % | 1.00 | % | 1.05 | % | 1.05 | % | 1.06 | % | 1.15 | % | ||||||||||||
Gross expenses | 1.06 | % | 1.13 | % | 1.34 | % | 2.29 | % | 2.96 | % | 7.40 | % | ||||||||||||
Net investment income (loss) | 4.04 | % | 1.45 | % | 1.35 | % | 1.64 | % | 1.13 | % | –0.41 | % | ||||||||||||
Portfolio turnover rate | 36 | % | 76 | % | 81 | % | 92 | % | 91 | % | 45 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 201
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 8/29/14* to | |||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.35 | $ | 10.45 | $ | 8.56 | $ | 8.29 | $ | 9.53 | $ | 10.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.16 | 0.09 | 0.10 | 0.11 | 0.06 | (0.02 | ) | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.33 | (1.82 | ) | 1.86 | 0.26 | (1.22 | ) | (0.45 | ) | |||||||||||||||
Total from investment operations | 1.49 | (1.73 | ) | 1.96 | 0.37 | (1.16 | ) | (0.47 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.15 | ) | (0.07 | ) | (0.10 | ) | (0.08 | ) | — | ||||||||||||||
Net realized gains | — | (0.22 | ) | — | — | — | — | (b) | ||||||||||||||||
Total distributions | — | (0.37 | ) | (0.07 | ) | (0.10 | ) | (0.08 | ) | — | (b) | |||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | |||||||||||||||||
Net asset value, end of period | $ | 9.84 | $ | 8.35 | $ | 10.45 | $ | 8.56 | $ | 8.29 | $ | 9.53 | ||||||||||||
Total Return (c) | 17.84 | % | –16.47 | % | 22.87 | % | 4.41 | % | –12.18 | % | –4.66 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 409 | $ | 399 | $ | 220 | $ | 114 | $ | 55 | $ | 559 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.25 | % | 1.29 | % | 1.35 | % | 1.35 | % | 1.39 | % | 1.45 | % | ||||||||||||
Gross expenses | 1.95 | % | 5.24 | % | 8.15 | % | 11.98 | % | 9.93 | % | 12.39 | % | ||||||||||||
Net investment income (loss) | 3.46 | % | 0.96 | % | 1.04 | % | 1.32 | % | 0.60 | % | –0.55 | % | ||||||||||||
Portfolio turnover rate | 36 | % | 76 | % | 81 | % | 92 | % | 91 | % | 45 | % |
† | Unaudited. |
* | The Portfolio commenced operations on August 29, 2014. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
202 Semi-Annual Report
LAZARD INTERNATIONAL EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 15.68 | $ | 19.61 | $ | 16.20 | $ | 17.08 | $ | 16.93 | $ | 17.85 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.30 | 0.37 | 0.26 | 0.27 | ^ | 0.27 | 0.26 | |||||||||||||||||
Net realized and unrealized gain (loss) | 2.14 | (3.06 | ) | 3.43 | (0.98 | ) | — | (1.02 | ) | |||||||||||||||
Total from investment operations | 2.44 | (2.69 | ) | 3.69 | (0.71 | ) | 0.27 | (0.76 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.42 | ) | (0.28 | ) | (0.17 | ) | (0.12 | ) | (0.16 | ) | |||||||||||||
Net realized gains | — | (0.82 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (1.24 | ) | (0.28 | ) | (0.17 | ) | (0.12 | ) | (0.16 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 18.12 | $ | 15.68 | $ | 19.61 | $ | 16.20 | $ | 17.08 | $ | 16.93 | ||||||||||||
Total Return (c) | 15.56 | % | –13.61 | %# | 22.81 | % | –4.18 | %^ | 1.62 | % | –4.29 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 2,501,284 | $ | 2,102,735 | $ | 2,835,262 | $ | 1,511,516 | $ | 736,272 | $ | 378,488 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.81 | % | 0.81 | % | 0.81 | % | 0.82 | %^ | 0.86 | % | 0.90 | % | ||||||||||||
Gross expenses | 0.81 | % | 0.81 | % | 0.81 | % | 0.84 | % | 0.87 | % | 0.90 | % | ||||||||||||
Net investment income (loss) | 3.50 | % | 1.94 | % | 1.44 | % | 1.62 | %^ | 1.50 | % | 1.46 | % | ||||||||||||
Portfolio turnover rate | 16 | % | 36 | % | 31 | % | 25 | % | 30 | % | 36 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 203
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 15.87 | $ | 19.83 | $ | 16.38 | $ | 17.23 | $ | 17.07 | $ | 18.00 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.27 | 0.32 | 0.30 | 0.13 | ^ | 0.23 | 0.27 | |||||||||||||||||
Net realized and unrealized gain (loss) | 2.17 | (3.08 | ) | 3.38 | (0.90 | ) | — | (1.09 | ) | |||||||||||||||
Total from investment operations | 2.44 | (2.76 | ) | 3.68 | (0.77 | ) | 0.23 | (0.82 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.38 | ) | (0.23 | ) | (0.08 | ) | (0.07 | ) | (0.11 | ) | |||||||||||||
Net realized gains | — | (0.82 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (1.20 | ) | (0.23 | ) | (0.08 | ) | (0.07 | ) | (0.11 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 18.31 | $ | 15.87 | $ | 19.83 | $ | 16.38 | $ | 17.23 | $ | 17.07 | ||||||||||||
Total Return (c) | 15.37 | % | –13.83 | %# | 22.50 | % | –4.46 | %^ | 1.36 | % | –4.57 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 259,583 | $ | 227,483 | $ | 275,014 | $ | 1,073,486 | $ | 80,221 | $ | 57,350 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.06 | % | 1.06 | % | 1.06 | % | 1.07 | %^ | 1.14 | % | 1.17 | % | ||||||||||||
Gross expenses | 1.06 | % | 1.06 | % | 1.06 | % | 1.10 | % | 1.14 | % | 1.17 | % | ||||||||||||
Net investment income (loss) | 3.20 | % | 1.67 | % | 1.69 | % | 0.80 | %^ | 1.29 | % | 1.49 | % | ||||||||||||
Portfolio turnover rate | 16 | % | 36 | % | 31 | % | 25 | % | 30 | % | 36 | % |
The accompanying notes are an integral part of these financial statements.
204 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 4/1/15 to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15* | |||||||||||||||
R6 Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 15.66 | $ | 19.59 | $ | 16.18 | $ | 17.07 | $ | 17.94 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.30 | 0.36 | 0.31 | 0.31^ | 0.21 | |||||||||||||||
Net realized and unrealized gain (loss) | 2.13 | (3.05 | ) | 3.38 | (1.02 | ) | (0.95 | ) | ||||||||||||
Total from investment operations | 2.43 | (2.69 | ) | 3.69 | (0.71 | ) | (0.74 | ) | ||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.42 | ) | (0.28 | ) | (0.18 | ) | (0.13 | ) | |||||||||||
Net realized gains | — | (0.82 | ) | — | — | — | ||||||||||||||
Total distributions | — | (1.24 | ) | (0.28 | ) | (0.18 | ) | (0.13 | ) | |||||||||||
Net asset value, end of period | $ | 18.09 | $ | 15.66 | $ | 19.59 | $ | 16.18 | $ | 17.07 | ||||||||||
Total Return (c) | 15.52 | % | –13.62 | %# | 22.85 | % | –4.17 | %^ | –4.10 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 116,616 | $ | 106,516 | $ | 693,744 | $ | 79,119 | $ | 49,387 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||
Net expenses | 0.80 | % | 0.80 | % | 0.80 | % | 0.80 | %^ | 0.80 | % | ||||||||||
Gross expenses | 0.82 | % | 0.81 | % | 0.81 | % | 0.86 | % | �� | 0.92 | % | |||||||||
Net investment income (loss) | 3.50 | % | 1.84 | % | 1.68 | % | 1.88 | %^ | 1.55 | % | ||||||||||
Portfolio turnover rate | 16 | % | 36 | % | 31 | % | 25 | % | 30 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was April 1, 2015. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. There was a 0.02%, 0.03% and 0.02% impact on the net expenses and net investment income (loss) ratios of the Portfolio’s Institutional, Open and R6 Shares, respectively. |
# | The Portfolio received settlement proceeds from a foreign exchange trading class action lawsuit. The proceeds from the settlement represent a realized gain and were recorded in the period received. There was a 0.16%, 0.16% and 0.33% impact on the total return of the Portfolio’s Institutional, Open and R6 Shares, respectively. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 205
LAZARD INTERNATIONAL EQUITY SELECT PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.13 | $ | 11.02 | $ | 8.65 | $ | 8.80 | $ | 9.24 | $ | 9.76 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.15 | 0.18 | 0.13 | 0.12 | 0.12 | 0.15 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.23 | (1.82 | ) | 2.31 | (0.17 | ) | (0.46 | ) | (0.58 | ) | ||||||||||||||
Total from investment operations | 1.38 | (1.64 | ) | 2.44 | (0.05 | ) | (0.34 | ) | (0.43 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.25 | ) | (0.07 | ) | (0.10 | ) | (0.10 | ) | (0.11 | ) | |||||||||||||
Total distributions | — | (0.25 | ) | (0.07 | ) | (0.10 | ) | (0.10 | ) | (0.11 | ) | |||||||||||||
Redemption fees | — | — | — | — | — | (b) | 0.02 | |||||||||||||||||
Net asset value, end of period | $ | 10.51 | $ | 9.13 | $ | 11.02 | $ | 8.65 | $ | 8.80 | $ | 9.24 | ||||||||||||
Total Return (c) | 15.12 | % | –14.90 | % | 28.31 | % | –0.63 | % | –3.63 | % | –4.29 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 91,301 | $ | 74,582 | $ | 53,929 | $ | 28,299 | $ | 18,757 | $ | 12,749 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.00 | % | 1.05 | % | 1.05 | % | 1.05 | % | 1.06 | % | 1.15 | % | ||||||||||||
Gross expenses | 1.00 | % | 1.05 | % | 1.31 | % | 1.79 | % | 2.13 | % | 2.10 | % | ||||||||||||
Net investment income (loss) | 2.94 | % | 1.73 | % | 1.27 | % | 1.36 | % | 1.25 | % | 1.54 | % | ||||||||||||
Portfolio turnover rate | 18 | % | 32 | % | 30 | % | 42 | % | 51 | % | 80 | % |
The accompanying notes are an integral part of these financial statements.
206 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.17 | $ | 11.03 | $ | 8.66 | $ | 8.82 | $ | 9.25 | $ | 9.79 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.13 | 0.15 | 0.10 | 0.10 | 0.11 | 0.11 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.24 | (1.82 | ) | 2.31 | (0.19 | ) | (0.47 | ) | (0.57 | ) | ||||||||||||||
Total from investment operations | 1.37 | (1.67 | ) | 2.41 | (0.09 | ) | (0.36 | ) | (0.46 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.19 | ) | (0.04 | ) | (0.07 | ) | (0.07 | ) | (0.08 | ) | |||||||||||||
Total distributions | — | (0.19 | ) | (0.04 | ) | (0.07 | ) | (0.07 | ) | (0.08 | ) | |||||||||||||
Redemption fees | — | — | — | — | — | — | (b) | |||||||||||||||||
Net asset value, end of period | $ | 10.54 | $ | 9.17 | $ | 11.03 | $ | 8.66 | $ | 8.82 | $ | 9.25 | ||||||||||||
Total Return (c) | 14.94 | % | –15.16 | % | 27.89 | % | –1.03 | % | –3.85 | % | –4.76 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,582 | $ | 1,502 | $ | 2,831 | $ | 2,092 | $ | 2,184 | $ | 3,048 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.35 | % | 1.35 | % | 1.35 | % | 1.35 | % | 1.37 | % | 1.45 | % | ||||||||||||
Gross expenses | 1.42 | % | 1.83 | % | 2.07 | % | 2.59 | % | 2.75 | % | 2.70 | % | ||||||||||||
Net investment income (loss) | 2.59 | % | 1.42 | % | 1.01 | % | 1.13 | % | 1.15 | % | 1.11 | % | ||||||||||||
Portfolio turnover rate | 18 | % | 32 | % | 30 | % | 42 | % | 51 | % | 80 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 207
LAZARD INTERNATIONAL EQUITY VALUE PORTFOLIO
Selected data for a | For the | ||||||||
share of capital stock | Six Months | Period | |||||||
outstanding | Ended | 10/31/18* to | |||||||
throughout each period | 6/30/19† | 12/31/18* | |||||||
Institutional Shares | |||||||||
Net asset value, beginning of period | $ | 9.14 | $ | 10.00 | |||||
Income (Loss) from investment operations: | |||||||||
Net investment income (loss) (a) | 0.22 | 0.01 | |||||||
Net realized and unrealized gain (loss) | 0.57 | (0.86 | ) | ||||||
Total from investment operations | 0.79 | (0.85 | ) | ||||||
Less distributions from: | |||||||||
Net investment income | — | (0.01 | ) | ||||||
Total distributions | — | (0.01 | ) | ||||||
Net asset value, end of period | $ | 9.93 | $ | 9.14 | |||||
Total Return (b) | 8.64 | % | –8.49 | % | |||||
Ratios and Supplemental Data: | |||||||||
Net assets, end of period (in thousands) | $ | 25,188 | $ | 22,945 | |||||
Ratios to average net assets (c): | |||||||||
Net expenses | 0.95 | % | 0.95 | % | |||||
Gross expenses | 1.95 | % | 1.34 | % | |||||
Net investment income (loss) | 4.55 | % | 0.72 | % | |||||
Portfolio turnover rate | 88 | % | 37 | % |
The accompanying notes are an integral part of these financial statements.
208 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout each period | Six Months Ended 6/30/19† | For the Period 10/31/18* to 12/31/18* | |||||||
Open Shares | |||||||||
Net asset value, beginning of period | $ | 9.13 | $ | 10.00 | |||||
Income (Loss) from investment operations: | |||||||||
Net investment income (loss) (a) | 0.23 | — | (d) | ||||||
Net realized and unrealized gain (loss) | 0.55 | (0.86 | ) | ||||||
Total from investment operations | 0.78 | (0.86 | ) | ||||||
Less distributions from: | |||||||||
Net investment income | — | (0.01 | ) | ||||||
Total distributions | — | (0.01 | ) | ||||||
Net asset value, end of period | $ | 9.91 | $ | 9.13 | |||||
Total Return (b) | 8.54 | % | –8.63 | % | |||||
Ratios and Supplemental Data: | |||||||||
Net assets, end of period (in thousands) | $ | 72 | $ | 38 | |||||
Ratios to average net assets (c): | |||||||||
Net expenses | 1.20 | % | 1.20 | % | |||||
Gross expenses | 23.09 | % | 7.91 | % | |||||
Net investment income (loss) | 4.84 | % | 0.03 | % | |||||
Portfolio turnover rate | 88 | % | 37 | % |
† | Unaudited. |
* | The Portfolio commenced operations on October 31, 2018. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year except for non-recurring expenses. |
(d) | Amount is less than $0.01 per share. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 209
LAZARD INTERNATIONAL SMALL CAP EQUITY PORTFOLIO
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.95 | $ | 13.79 | $ | 10.10 | $ | 10.90 | $ | 10.01 | $ | 10.54 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.12 | 0.10 | 0.12 | ^ | 0.10 | 0.12 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.31 | (3.51 | ) | 3.59 | (0.62 | ) | 0.87 | (0.40 | ) | |||||||||||||||
Total from investment operations | 1.42 | (3.39 | ) | 3.69 | (0.50 | ) | 0.97 | (0.28 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.27 | ) | — | (0.30 | ) | (0.08 | ) | (0.25 | ) | ||||||||||||||
Net realized gains | — | (0.18 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (0.45 | ) | — | (0.30 | ) | (0.08 | ) | (0.25 | ) | ||||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | (b) | ||||||||||||||||
Net asset value, end of period | $ | 11.37 | $ | 9.95 | $ | 13.79 | $ | 10.10 | $ | 10.90 | $ | 10.01 | ||||||||||||
Total Return(c) | 14.27 | % | –24.88 | %# | 36.53 | % | –4.64 | %^ | 9.71 | % | –2.77 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 37,672 | $ | 35,121 | $ | 41,267 | $ | 37,049 | $ | 51,828 | $ | 46,329 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.12 | % | 1.08 | % | 1.09 | % | 0.96 | %^ | 1.11 | % | 1.13 | % | ||||||||||||
Gross expenses | 1.12 | % | 1.08 | % | 1.09 | % | 1.06 | % | 1.11 | % | 1.15 | % | ||||||||||||
Net investment income (loss) | 2.04 | % | 0.96 | % | 0.85 | % | 1.14 | %^ | 0.91 | % | 1.13 | % | ||||||||||||
Portfolio turnover rate | 20 | % | 59 | % | 35 | % | 63 | % | 48 | % | 48 | % |
The accompanying notes are an integral part of these financial statements.
210 Semi-Annual Report
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.97 | $ | 13.82 | $ | 10.15 | $ | 10.93 | $ | 10.03 | $ | 10.56 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.09 | 0.11 | 0.07 | 0.10 | ^ | 0.07 | 0.09 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.32 | (3.54 | ) | 3.60 | (0.63 | ) | 0.88 | (0.40 | ) | |||||||||||||||
Total from investment operations | 1.41 | (3.43 | ) | 3.67 | (0.53 | ) | 0.95 | (0.31 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.24 | ) | — | (0.25 | ) | (0.05 | ) | (0.22 | ) | ||||||||||||||
Net realized gains | — | (0.18 | ) | — | — | — | — | |||||||||||||||||
Total distributions | — | (0.42 | ) | — | (0.25 | ) | (0.05 | ) | (0.22 | ) | ||||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 11.38 | $ | 9.97 | $ | 13.82 | $ | 10.15 | $ | 10.93 | $ | 10.03 | ||||||||||||
Total Return (c) | 14.14 | % | –25.09 | %# | 36.16 | % | –4.92 | %^ | 9.49 | % | –3.05 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 19,924 | $ | 20,265 | $ | 42,362 | $ | 44,523 | $ | 55,776 | $ | 19,994 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.38 | % | 1.34 | % | 1.34 | % | 1.21 | %^ | 1.38 | % | 1.43 | % | ||||||||||||
Gross expenses | 1.38 | % | 1.34 | % | 1.34 | % | 1.30 | % | 1.38 | % | 1.44 | % | ||||||||||||
Net investment income (loss) | 1.72 | % | 0.83 | % | 0.61 | % | 0.91 | %^ | 0.63 | % | 0.85 | % | ||||||||||||
Portfolio turnover rate | 20 | % | 59 | % | 35 | % | 63 | % | 48 | % | 48 | % | ||||||||||||
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The impact on the net investment income per share amount was $0.01 per share. There was a 0.10% and 0.09% impact on the total return of the Institutional and Open Shares classes, respectively, of the Portfolio. There was a 0.10% and 0.09% impact on the net expenses and net investment income (loss) ratios of the Portfolio’s Institutional and Open Shares, respectively. |
# | The Portfolio received settlement proceeds from a foreign exchange trading classaction lawsuit. The proceeds from the settlement represented a realized gain and were recorded in the period received. There was a 0.46% and 0.53% impact on the total return of the Portfolio’s Institutional and Open Shares, respectively. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 211
LAZARD INTERNATIONAL STRATEGIC EQUITY PORTFOLIO
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 12.89 | $ | 15.70 | $ | 12.44 | $ | 13.33 | $ | 13.72 | $ | 14.46 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.21 | 0.17 | 0.20 | ^ | 0.16 | 0.19 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.80 | (1.85 | ) | 3.29 | (0.89 | ) | (0.40 | ) | (0.39 | ) | ||||||||||||||
Total from investment operations | 1.99 | (1.64 | ) | 3.46 | (0.69 | ) | (0.24 | ) | (0.20 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.21 | ) | (0.20 | ) | (0.20 | ) | (0.14 | ) | (0.16 | ) | |||||||||||||
Net realized gains | — | (0.96 | ) | — | — | (0.01 | ) | (0.38 | ) | |||||||||||||||
Total distributions | — | (1.17 | ) | (0.20 | ) | (0.20 | ) | (0.15 | ) | (0.54 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 14.88 | $ | 12.89 | $ | 15.70 | $ | 12.44 | $ | 13.33 | $ | 13.72 | ||||||||||||
Total Return(c) | 15.44 | % | –10.35 | % | 27.85 | % | –5.17 | %^ | –1.70 | % | –1.48 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 5,402,314 | $ | 4,630,334 | $ | 5,911,184 | $ | 5,114,357 | $ | 4,923,328 | $ | 3,727,391 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.80 | % | 0.80 | % | 0.80 | % | 0.81 | %^ | 0.82 | % | 0.84 | % | ||||||||||||
Gross expenses | 0.80 | % | 0.80 | % | 0.80 | % | 0.81 | % | 0.82 | % | 0.84 | % | ||||||||||||
Net investment income (loss) | 2.75 | % | 1.36 | % | 1.20 | % | 1.56 | %^ | 1.15 | % | 1.28 | % | ||||||||||||
Portfolio turnover rate | 15 | % | 40 | % | 44 | % | 47 | % | 37 | % | 33 | % |
The accompanying notes are an integral part of these financial statements.
212 Semi-Annual Report
Selected data for a | ||||||||||||||||||||||||
share of capital stock | Six Months | |||||||||||||||||||||||
outstanding | Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 13.01 | $ | 15.83 | $ | 12.55 | $ | 13.44 | $ | 13.82 | $ | 14.57 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.17 | 0.17 | 0.14 | 0.18 | ^ | 0.13 | 0.16 | |||||||||||||||||
Net realized and unrealized gain (loss) | 1.82 | (1.86 | ) | 3.30 | (0.90 | ) | (0.40 | ) | (0.41 | ) | ||||||||||||||
Total from investment operations | 1.99 | (1.69 | ) | 3.44 | (0.72 | ) | (0.27 | ) | (0.25 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.17 | ) | (0.16 | ) | (0.17 | ) | (0.10 | ) | (0.12 | ) | |||||||||||||
Net realized gains | — | (0.96 | ) | — | — | (0.01 | ) | (0.38 | ) | |||||||||||||||
Total distributions | — | (1.13 | ) | (0.16 | ) | (0.17 | ) | (0.11 | ) | (0.50 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 15.00 | $ | 13.01 | $ | 15.83 | $ | 12.55 | $ | 13.44 | $ | 13.82 | ||||||||||||
Total Return (c) | 15.30 | % | –10.55 | % | 27.44 | % | –5.37 | %^ | –1.89 | % | –1.78 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 894,400 | $ | 832,548 | $ | 1,216,861 | $ | 1,591,016 | $ | 1,783,529 | $ | 1,574,106 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.05 | % | 1.05 | % | 1.06 | % | 1.06 | %^ | 1.08 | % | 1.09 | % | ||||||||||||
Gross expenses | 1.05 | % | 1.05 | % | 1.06 | % | 1.06 | % | 1.08 | % | 1.09 | % | ||||||||||||
Net investment income (loss) | 2.45 | % | 1.10 | % | 0.97 | % | 1.34 | %^ | 0.94 | % | 1.06 | % | ||||||||||||
Portfolio turnover rate | 15 | % | 40 | % | 44 | % | 47 | % | 37 | % | 33 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 213
Selected data for a share | Six Months | For the Period | ||||||||||||||||||
of capital stock outstanding | Ended | Year Ended | 1/19/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
R6 Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 12.90 | $ | 15.71 | $ | 12.45 | $ | 13.34 | $ | 13.70 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.21 | 0.16 | 0.19 | ^ | (0.03 | ) | |||||||||||||
Net realized and unrealized gain (loss) | 1.81 | (1.85 | ) | 3.30 | (0.88 | ) | (0.21 | ) | ||||||||||||
Total from investment operations | 2.00 | (1.64 | ) | 3.46 | (0.69 | ) | (0.24 | ) | ||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.21 | ) | (0.20 | ) | (0.20 | ) | (0.11 | ) | |||||||||||
Net realized gains | — | (0.96 | ) | — | — | (0.01 | ) | |||||||||||||
Total distributions | — | (1.17 | ) | (0.20 | ) | (0.20 | ) | (0.12 | ) | |||||||||||
Redemption fees | — | — | — | — | (b) | — | ||||||||||||||
Net asset value, end of period | $ | 14.90 | $ | 12.90 | $ | 15.71 | $ | 12.45 | $ | 13.34 | ||||||||||
Total Return (c) | 15.50 | % | –10.35 | % | 27.82 | % | –5.17 | %^ | –1.73 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 107,042 | $ | 97,394 | $ | 110,383 | $ | 96,284 | $ | 72,362 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||
Net expenses | 0.80 | % | 0.80 | % | 0.80 | % | 0.81 | %^ | 1.03 | % | ||||||||||
Gross expenses | 0.81 | % | 0.81 | % | 0.82 | % | 0.82 | % | 1.09 | % | ||||||||||
Net investment income (loss) | 2.71 | % | 1.34 | % | 1.15 | % | 1.46 | %^ | –0.22 | % | ||||||||||
Portfolio turnover rate | 15 | % | 40 | % | 44 | % | 47 | % | 37 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was January 19, 2015. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
214 Semi-Annual Report
LAZARD MANAGED EQUITY VOLATILITY PORTFOLIO
Selected data for a share | Six Months | For the Period | ||||||||||||||||||
of capital stock outstanding | Ended | Year Ended | 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Institutional Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 10.55 | $ | 11.57 | $ | 9.99 | $ | 9.59 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.12 | 0.19 | 0.19 | 0.18 | 0.09 | |||||||||||||||
Net realized and unrealized gain (loss) | 1.46 | (1.03 | ) | 1.87 | 0.44 | (0.33 | ) | |||||||||||||
Total from investment operations | 1.58 | (0.84 | ) | 2.06 | 0.62 | (0.24 | ) | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.16 | ) | (0.17 | ) | (0.22 | ) | (0.17 | ) | |||||||||||
Net realized gains | — | (0.02 | ) | (0.31 | ) | — | — | |||||||||||||
Total distributions | — | (0.18 | ) | (0.48 | ) | (0.22 | ) | (0.17 | ) | |||||||||||
Net asset value, end of period | $ | 12.13 | $ | 10.55 | $ | 11.57 | $ | 9.99 | $ | 9.59 | ||||||||||
Total Return (b) | 14.98 | % | –7.21 | % | 20.57 | % | 6.45 | % | –2.42 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 25,195 | $ | 20,709 | $ | 4,180 | $ | 2,431 | $ | 2,206 | ||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||
Net expenses | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||
Gross expenses | 1.39 | % | 1.64 | % | 6.51 | % | 10.42 | % | 13.51 | % | ||||||||||
Net investment income (loss) | 2.04 | % | 1.66 | % | 1.71 | % | 1.82 | % | 1.64 | % | ||||||||||
Portfolio turnover rate | 56 | % | 122 | % | 87 | % | 91 | % | 56 | % | ||||||||||
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 215
Selected data for a share | Six Months | For the Period | ||||||||||||||||||
of capital stock outstanding | Ended | Year Ended | 5/29/15* to | |||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | |||||||||||||||
Open Shares | ||||||||||||||||||||
Net asset value, beginning of period | $ | 10.54 | $ | 11.56 | $ | 9.99 | $ | 9.59 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.15 | 0.16 | 0.15 | 0.08 | |||||||||||||||
Net realized and unrealized gain (loss) | 1.47 | (1.02 | ) | 1.85 | 0.44 | (0.34 | ) | |||||||||||||
Total from investment operations | 1.57 | (0.87 | ) | 2.01 | 0.59 | (0.26 | ) | |||||||||||||
Less distributions from: | ||||||||||||||||||||
Net investment income | — | (0.13 | ) | (0.13 | ) | (0.19 | ) | (0.15 | ) | |||||||||||
Net realized gains | — | (0.02 | ) | (0.31 | ) | — | — | |||||||||||||
Total distributions | — | (0.15 | ) | (0.44 | ) | (0.19 | ) | (0.15 | ) | |||||||||||
Net asset value, end of period | $ | 12.11 | $ | 10.54 | $ | 11.56 | $ | 9.99 | $ | 9.59 | ||||||||||
Total Return (b) | 14.90 | % | –7.50 | % | 20.11 | % | 6.14 | % | –2.60 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 211 | $ | 183 | $ | 315 | $ | 172 | $ | 175 | ||||||||||
Ratios to average net assets (c): | ||||||||||||||||||||
Net expenses | 1.05 | % | 1.05 | % | 1.05 | % | 1.05 | % | 1.05 | % | ||||||||||
Gross expenses | 3.02 | % | 5.86 | % | 12.07 | % | 17.27 | % | 23.94 | % | ||||||||||
Net investment income (loss) | 1.74 | % | 1.28 | % | 1.42 | % | 1.52 | % | 1.33 | % | ||||||||||
Portfolio turnover rate | 56 | % | 122 | % | 87 | % | 91 | % | 56 | % | ||||||||||
† | Unaudited. |
* | The Portfolio commenced operations on May 29, 2015. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(c) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
216 Semi-Annual Report
LAZARD US EQUITY CONCENTRATED PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 12.89 | $ | 15.31 | $ | 14.16 | $ | 13.83 | $ | 13.41 | $ | 12.59 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.06 | 0.18 | 0.14 | 0.06 | ^ | 0.05 | 0.11 | |||||||||||||||||
Net realized and unrealized gain (loss) | 2.73 | (1.11 | ) | 2.05 | 0.97 | 0.88 | 2.23 | |||||||||||||||||
Total from investment operations | 2.79 | (0.93 | ) | 2.19 | 1.03 | 0.93 | 2.34 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.20 | ) | (0.14 | ) | (0.05 | ) | (0.04 | ) | (0.09 | ) | |||||||||||||
Net realized gains | — | (1.29 | ) | (0.90 | ) | (0.65 | ) | (0.47 | ) | (1.43 | ) | |||||||||||||
Total distributions | — | (1.49 | ) | (1.04 | ) | (0.70 | ) | (0.51 | ) | (1.52 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 15.68 | $ | 12.89 | $ | 15.31 | $ | 14.16 | $ | 13.83 | $ | 13.41 | ||||||||||||
Total Return (c) | 21.64 | % | –6.07 | % | 15.49 | % | 7.37 | %^ | 7.00 | % | 18.88 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,243,345 | $ | 1,040,851 | $ | 1,508,581 | $ | 1,230,377 | $ | 715,766 | $ | 331,074 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.76 | % | 0.75 | % | 0.75 | % | 0.77 | %^ | 0.79 | % | 0.81 | % | ||||||||||||
Gross expenses | 0.76 | % | 0.75 | % | 0.75 | % | 0.77 | % | 0.79 | % | 0.81 | % | ||||||||||||
Net investment income (loss) | 0.83 | % | 1.14 | % | 0.90 | % | 0.39 | %^ | 0.36 | % | 0.79 | % | ||||||||||||
Portfolio turnover rate | 23 | % | 69 | % | 86 | % | 84 | % | 74 | % | 63 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 217
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 12.99 | $ | 15.42 | $ | 14.25 | $ | 13.92 | $ | 13.50 | $ | 12.68 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.04 | 0.13 | 0.10 | 0.02 | ^ | 0.01 | 0.05 | |||||||||||||||||
Net realized and unrealized gain (loss) | 2.75 | (1.11 | ) | 2.07 | 0.97 | 0.88 | 2.23 | |||||||||||||||||
Total from investment operations | 2.79 | (0.98 | ) | 2.17 | 0.99 | 0.89 | 2.28 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.16 | ) | (0.10 | ) | (0.01 | ) | — | (b) | (0.03 | ) | |||||||||||||
Net realized gains | — | (1.29 | ) | (0.90 | ) | (0.65 | ) | (0.47 | ) | (1.43 | ) | |||||||||||||
Total distributions | — | (1.45 | ) | (1.00 | ) | (0.66 | ) | (0.47 | ) | (1.46 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 15.78 | $ | 12.99 | $ | 15.42 | $ | 14.25 | $ | 13.92 | $ | 13.50 | ||||||||||||
Total Return (c) | 21.48 | % | –6.35 | % | 15.22 | % | 7.06 | %^ | 6.67 | % | 18.28 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 46,039 | $ | 50,981 | $ | 87,603 | $ | 105,619 | $ | 114,348 | $ | 8,011 | ||||||||||||
Ratios to average net assets (d): | �� | |||||||||||||||||||||||
Net expenses | 1.04 | % | 1.03 | % | 1.03 | % | 1.03 | %^ | 1.07 | % | 1.25 | % | ||||||||||||
Gross expenses | 1.04 | % | 1.03 | % | 1.03 | % | 1.03 | % | 1.07 | % | 1.46 | % | ||||||||||||
Net investment income (loss) | 0.51 | % | 0.85 | % | 0.62 | % | 0.17 | %^ | 0.08 | % | 0.37 | % | ||||||||||||
Portfolio turnover rate | 23 | % | 69 | % | 86 | % | 84 | % | 74 | % | 63 | % |
The accompanying notes are an integral part of these financial statements.
218 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 11/15/16* to | ||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | |||||||||||||
R6 Shares | |||||||||||||||||
Net asset value, beginning of period | $ | 12.92 | $ | 15.34 | $ | 14.18 | $ | 14.77 | |||||||||
Income (Loss) from investment operations: | |||||||||||||||||
Net investment income (loss) (a) | 0.06 | 0.17 | 0.14 | — | (b)^ | ||||||||||||
Net realized and unrealized gain (loss) | 2.74 | (1.10 | ) | 2.06 | 0.03 | ||||||||||||
Total from investment operations | 2.80 | (0.93 | ) | 2.20 | 0.03 | ||||||||||||
Less distributions from: | |||||||||||||||||
Net investment income | — | (0.20 | ) | (0.14 | ) | (0.03 | ) | ||||||||||
Net realized gains | — | (1.29 | ) | (0.90 | ) | (0.59 | ) | ||||||||||
Total distributions | — | (1.49 | ) | (1.04 | ) | (0.62 | ) | ||||||||||
Net asset value, end of period | $ | 15.72 | $ | 12.92 | $ | 15.34 | $ | 14.18 | |||||||||
Total Return (c) | 21.67 | % | –6.08 | % | 15.52 | % | 0.17 | %^ | |||||||||
Ratios and Supplemental Data: | |||||||||||||||||
Net assets, end of period (in thousands) | $ | 2,259 | $ | 1,900 | $ | 361 | $ | 140 | |||||||||
Ratios to average net assets (d): | |||||||||||||||||
Net expenses | 0.77 | % | 0.75 | % | 0.75 | % | 0.77 | %^ | |||||||||
Gross expenses | 0.90 | % | 2.16 | % | 8.34 | % | 15.38 | % | |||||||||
Net investment income (loss) | 0.80 | % | 1.15 | % | 0.91 | % | 0.19 | %^ | |||||||||
Portfolio turnover rate | 23 | % | 69 | % | 86 | % | 84 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was November 15, 2016. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 219
LAZARD US EQUITY SELECT PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.23 | $ | 12.43 | $ | 11.63 | $ | 10.97 | $ | 12.43 | $ | 12.49 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.06 | 0.14 | 0.14 | 0.12 | 0.09 | 0.14 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.84 | (0.55 | ) | 1.94 | 0.94 | (0.69 | ) | 1.73 | ||||||||||||||||
Total from investment operations | 1.90 | (0.41 | ) | 2.08 | 1.06 | (0.60 | ) | 1.87 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.29 | ) | (0.21 | ) | (0.10 | ) | (0.10 | ) | (0.13 | ) | |||||||||||||
Net realized gains | — | (1.50 | ) | (1.07 | ) | (0.30 | ) | (0.76 | ) | (1.80 | ) | |||||||||||||
Total distributions | — | (1.79 | ) | (1.28 | ) | (0.40 | ) | (0.86 | ) | (1.93 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 12.13 | $ | 10.23 | $ | 12.43 | $ | 11.63 | $ | 10.97 | $ | 12.43 | ||||||||||||
Total Return (c) | 18.57 | % | –3.12 | % | 18.17 | % | 9.70 | % | –4.75 | % | 15.04 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 66,444 | $ | 60,629 | $ | 72,958 | $ | 72,151 | $ | 110,243 | $ | 119,941 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | 0.75 | % | ||||||||||||
Gross expenses | 0.90 | % | 0.92 | % | 0.95 | % | 0.94 | % | 0.90 | % | 0.90 | % | ||||||||||||
Net investment income (loss) | 1.11 | % | 1.10 | % | 1.10 | % | 1.08 | % | 0.77 | % | 1.05 | % | ||||||||||||
Portfolio turnover rate | 24 | % | 62 | % | 74 | % | 68 | % | 75 | % | 69 | % |
The accompanying notes are an integral part of these financial statements.
220 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.28 | $ | 12.48 | $ | 11.68 | $ | 11.01 | $ | 12.48 | $ | 12.53 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.05 | 0.10 | 0.10 | 0.09 | 0.06 | 0.10 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.84 | (0.54 | ) | 1.94 | 0.94 | (0.71 | ) | 1.74 | ||||||||||||||||
Total from investment operations | 1.89 | (0.44 | ) | 2.04 | 1.03 | (0.65 | ) | 1.84 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.26 | ) | (0.17 | ) | (0.06 | ) | (0.06 | ) | (0.09 | ) | |||||||||||||
Net realized gains | — | (1.50 | ) | (1.07 | ) | (0.30 | ) | (0.76 | ) | (1.80 | ) | |||||||||||||
Total distributions | — | (1.76 | ) | (1.24 | ) | (0.36 | ) | (0.82 | ) | (1.89 | ) | |||||||||||||
Net asset value, end of period | $ | 12.17 | $ | 10.28 | $ | 12.48 | $ | 11.68 | $ | 11.01 | $ | 12.48 | ||||||||||||
Total Return (c) | 18.39 | % | –3.40 | % | 17.75 | % | 9.46 | % | –5.11 | % | 14.77 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1,020 | $ | 881 | $ | 1,013 | $ | 1,376 | $ | 1,536 | $ | 6,833 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.05 | % | 1.05 | % | 1.05 | % | 1.05 | % | 1.05 | % | 1.05 | % | ||||||||||||
Gross expenses | 1.44 | % | 2.33 | % | 2.30 | % | 2.13 | % | 1.51 | % | 1.31 | % | ||||||||||||
Net investment income (loss) | 0.81 | % | 0.80 | % | 0.79 | % | 0.80 | % | 0.50 | % | 0.75 | % | ||||||||||||
Portfolio turnover rate | 24 | % | 62 | % | 74 | % | 68 | % | 75 | % | 69 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 221
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/19/14* to | |||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
R6 Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.23 | $ | 12.43 | $ | 11.63 | $ | 10.96 | $ | 12.43 | $ | 12.81 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.06 | 0.14 | 0.14 | 0.14 | 0.10 | 0.09 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 1.85 | (0.55 | ) | 1.94 | 0.93 | (0.71 | ) | 1.47 | ||||||||||||||||
Total from investment operations | 1.91 | (0.41 | ) | 2.08 | 1.07 | (0.61 | ) | 1.56 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.29 | ) | (0.21 | ) | (0.10 | ) | (0.10 | ) | (0.14 | ) | |||||||||||||
Net realized gains | — | (1.50 | ) | (1.07 | ) | (0.30 | ) | (0.76 | ) | (1.80 | ) | |||||||||||||
Total distributions | — | (1.79 | ) | (1.28 | ) | (0.40 | ) | (0.86 | ) | (1.94 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 12.14 | $ | 10.23 | $ | 12.43 | $ | 11.63 | $ | 10.96 | $ | 12.43 | ||||||||||||
Total Return (c) | 18.67 | % | –3.13 | % | 18.16 | % | 9.81 | % | –4.78 | % | 12.23 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 11,450 | $ | 10,056 | $ | 11,394 | $ | 13,297 | $ | 12,359 | $ | 14,951 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.75 | % | 0.75 | % | 0.75 | % | 0.74 | % | 0.70 | % | 0.70 | % | ||||||||||||
Gross expenses | 0.91 | % | 1.01 | % | 1.05 | % | 1.02 | % | 1.00 | % | 1.06 | % | ||||||||||||
Net investment income (loss) | 1.12 | % | 1.10 | % | 1.12 | % | 1.27 | % | 0.82 | % | 1.14 | % | ||||||||||||
Portfolio turnover rate | 24 | % | 62 | % | 74 | % | 68 | % | 75 | % | 69 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was May 19, 2014. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
222 Semi-Annual Report
LAZARD US REALTY EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 16.69 | $ | 18.85 | $ | 19.37 | $ | 18.93 | $ | 19.71 | $ | 16.05 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.24 | 0.28 | 0.31 | 0.29 | 0.33 | 0.28 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 3.20 | (1.74 | ) | 1.18 | 0.72 | 0.55 | 3.85 | |||||||||||||||||
Total from investment operations | 3.44 | (1.46 | ) | 1.49 | 1.01 | 0.88 | 4.13 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.32 | ) | (0.37 | ) | (0.31 | ) | (0.38 | ) | (0.20 | ) | |||||||||||||
Net realized gains | — | (0.38 | ) | (1.64 | ) | (0.26 | ) | (1.28 | ) | (0.27 | ) | |||||||||||||
Total distributions | — | (0.70 | ) | (2.01 | ) | (0.57 | ) | (1.66 | ) | (0.47 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 20.13 | $ | 16.69 | $ | 18.85 | $ | 19.37 | �� | $ | 18.93 | $ | 19.71 | |||||||||||
Total Return (c) | 20.61 | % | –7.77 | % | 7.93 | % | 5.31 | % | 4.63 | % | 25.70 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 20,351 | $ | 15,715 | $ | 18,724 | $ | 19,625 | $ | 21,143 | $ | 21,806 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.00 | % | 1.00 | % | 1.02 | % | 1.05 | % | 1.05 | % | 1.05 | % | ||||||||||||
Gross expenses | 1.03 | % | 1.09 | % | 1.09 | % | 1.12 | % | 1.09 | % | 1.18 | % | ||||||||||||
Net investment income (loss) | 2.49 | % | 1.56 | % | 1.55 | % | 1.50 | % | 1.64 | % | 1.50 | % | ||||||||||||
Portfolio turnover rate | 11 | % | 52 | % | 32 | % | 41 | % | 51 | % | 43 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 223
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 16.77 | $ | 18.94 | $ | 19.44 | $ | 19.00 | $ | 19.78 | $ | 16.11 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.21 | 0.23 | 0.25 | 0.23 | 0.26 | 0.19 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 3.22 | (1.75 | ) | 1.20 | 0.72 | 0.56 | 3.90 | |||||||||||||||||
Total from investment operations | 3.43 | (1.52 | ) | 1.45 | 0.95 | 0.82 | 4.09 | |||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.27 | ) | (0.31 | ) | (0.25 | ) | (0.32 | ) | (0.15 | ) | |||||||||||||
Net realized gains | — | (0.38 | ) | (1.64 | ) | (0.26 | ) | (1.28 | ) | (0.27 | ) | |||||||||||||
Total distributions | — | (0.65 | ) | (1.95 | ) | (0.51 | ) | (1.60 | ) | (0.42 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 20.20 | $ | 16.77 | $ | 18.94 | $ | 19.44 | $ | 19.00 | $ | 19.78 | ||||||||||||
Total Return (c) | 20.45 | % | –8.06 | % | 7.69 | % | 4.99 | % | 4.34 | % | 25.33 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 45,318 | $ | 43,946 | $ | 47,811 | $ | 59,307 | $ | 75,907 | $ | 88,897 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.27 | % | 1.29 | % | 1.30 | % | 1.34 | % | 1.32 | % | 1.35 | % | ||||||||||||
Gross expenses | 1.27 | % | 1.29 | % | 1.30 | % | 1.34 | % | 1.32 | % | 1.42 | % | ||||||||||||
Net investment income (loss) | 2.16 | % | 1.27 | % | 1.24 | % | 1.17 | % | 1.32 | % | 1.01 | % | ||||||||||||
Portfolio turnover rate | 11 | % | 52 | % | 32 | % | 41 | % | 51 | % | 43 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
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LAZARD US SMALL-MID CAP EQUITY PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.83 | $ | 14.65 | $ | 14.50 | $ | 12.86 | $ | 14.05 | $ | 15.97 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.03 | 0.05 | 0.06 | 0.11 | ^ | 0.02 | 0.03 | |||||||||||||||||
Net realized and unrealized gain (loss) | 2.30 | (2.00 | ) | 1.95 | 1.96 | (0.34 | ) | 1.74 | ||||||||||||||||
Total from investment operations | 2.33 | (1.95 | ) | 2.01 | 2.07 | (0.32 | ) | 1.77 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | (0.04 | ) | (0.09 | ) | (0.09 | ) | — | (b) | (0.01 | ) | |||||||||||||
Net realized gains | — | (1.83 | ) | (1.77 | ) | (0.34 | ) | (0.87 | ) | (3.68 | ) | |||||||||||||
Total distributions | — | (1.87 | ) | (1.86 | ) | (0.43 | ) | (0.87 | ) | (3.69 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 13.16 | $ | 10.83 | $ | 14.65 | $ | 14.50 | $ | 12.86 | $ | 14.05 | ||||||||||||
Total Return (c) | 21.51 | % | –13.27 | % | 14.12 | % | 16.28 | %^ | –2.14 | % | 11.39 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 71,356 | $ | 113,677 | $ | 176,975 | $ | 189,593 | $ | 171,152 | $ | 157,742 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.90 | % | 0.87 | % | 0.87 | % | 0.86 | %^ | 0.91 | % | 0.86 | % | ||||||||||||
Gross expenses | 0.90 | % | 0.87 | % | 0.87 | % | 0.90 | % | 0.91 | % | 0.86 | % | ||||||||||||
Net investment income (loss) | 0.51 | % | 0.35 | % | 0.39 | % | 0.84 | %^ | 0.13 | % | 0.17 | % | ||||||||||||
Portfolio turnover rate | 35 | % | 81 | % | 79 | % | 91 | % | 91 | % | 91 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 225
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | ||||||||||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 10.03 | $ | 13.72 | $ | 13.68 | $ | 12.16 | $ | 13.38 | $ | 15.41 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.01 | 0.01 | 0.01 | 0.06 | ^ | (0.02 | ) | (0.02 | ) | |||||||||||||||
Net realized and unrealized gain (loss) | 2.13 | (1.87 | ) | 1.84 | 1.85 | (0.33 | ) | 1.67 | ||||||||||||||||
Total from investment operations | 2.14 | (1.86 | ) | 1.85 | 1.91 | (0.35 | ) | 1.65 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | — | — | (b) | (0.04 | ) | (0.05 | ) | — | (b) | — | ||||||||||||||
Net realized gains | — | (1.83 | ) | (1.77 | ) | (0.34 | ) | (0.87 | ) | (3.68 | ) | |||||||||||||
Total distributions | — | (1.83 | ) | (1.81 | ) | (0.39 | ) | (0.87 | ) | (3.68 | ) | |||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 12.17 | $ | 10.03 | $ | 13.72 | $ | 13.68 | $ | 12.16 | $ | 13.38 | ||||||||||||
Total Return (c) | 21.34 | % | –13.49 | % | 13.82 | % | 15.92 | %^ | –2.47 | % | 11.01 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 14,396 | $ | 13,726 | $ | 25,973 | $ | 30,332 | $ | 36,860 | $ | 15,851 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.17 | % | 1.18 | % | 1.17 | % | 1.16 | %^ | 1.20 | % | 1.20 | % | ||||||||||||
Gross expenses | 1.17 | % | 1.18 | % | 1.17 | % | 1.20 | % | 1.20 | % | 1.20 | % | ||||||||||||
Net investment income (loss) | 0.23 | % | 0.04 | % | 0.09 | % | 0.51 | %^ | –0.13 | % | –0.15 | % | ||||||||||||
Portfolio turnover rate | 35 | % | 81 | % | 79 | % | 91 | % | 91 | % | 91 | % |
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The impact on the net investment income per share amount was $0.01 per share. There was a 0.08% impact on the total return of the Institutional Shares class of the Portfolio. There was a 0.04% impact on the net expenses and net investment income (loss) ratios of the Portfolio. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year. |
The accompanying notes are an integral part of these financial statements.
226 Semi-Annual Report
The Lazard Funds, Inc.Notes to Financial Statements
June 30, 2019 (unaudited)
1. Organization
The Lazard Funds, Inc. was incorporated in Maryland on May 17, 1991 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. As of June 30, 2019, the Fund was comprised of thirty-two no-load portfolios (each referred to as a “Portfolio”). This report includes only the financial statements of Developing Markets Equity, Emerging Markets Core Equity, Emerging Markets Equity Advantage, Emerging Markets Equity Blend, Emerging Markets Equity, Equity Franchise, Global Equity Select, Global Listed Infrastructure, Global Strategic Equity, International Equity Advantage, International Equity Concentrated, International Equity, International Equity Select, International Equity Value, International Small Cap Equity, International Strategic Equity, International Quality Growth (formerly International Compounders), Managed Equity Volatility, US Equity Concentrated, US Equity Select, US Realty Equity and US Small-Mid Cap Equity Portfolios. The financial statements of the other ten Portfolios are presented separately.
The Portfolios, other than Equity Franchise, International Equity Concentrated, International Equity Value, US Equity Concentrated, and US Realty Equity Portfolios, are operated as “diversified” funds, as defined in the 1940 Act.
Each Portfolio currently offers Institutional Shares and Open Shares, and certain Portfolios offer R6 Shares. Each share class is identical except as to minimum investment requirements; eligibility requirements for R6 Shares; the services offered to, and expenses borne by, each class; and the availability of Service Payments (as defined in the Portfolios’ Prospectus).
2. Significant Accounting Policies
The accompanying financial statements are presented in conformity with US Generally Accepted Accounting Principles (“GAAP”). The Fund is an investment company and therefore applies specialized accounting guidance in accordance with Accounting Standards Codification Topic 946. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of the financial statements:
Semi-Annual Report 227
(a) Valuation of Investments—Equity securities traded on a securities exchange or market, including exchange-traded option contracts, rights and warrants, are valued at the last reported sales price (for domestic equity securities) or the closing price (for foreign equity securities) on the exchange or market on which the security is principally traded or, for securities trading on the NASDAQ National Market System (“NASDAQ”), the NASDAQ Official Closing Price. If there is no available closing price for a foreign equity security, the last reported sales price is used. If there are no reported sales of a security on the valuation date, the security is valued at the most recent quoted bid price on such date reported by such principal exchange or market. Forward currency contracts generally are valued using quotations from an independent pricing service. Investments in money market funds are valued at the fund’s net asset value (“NAV”) per share.
Calculation of a Portfolio’s NAV may not take place contemporaneously with the determination of the prices of portfolio assets used in such calculation. Trading on Europe, Latin and South America and Far East securities exchanges and in over-the-counter markets ordinarily is completed well before the close of business on each business day in New York (i.e., a day on which the New York Stock Exchange (the “NYSE”) is open). In addition, European or Far Eastern securities trading generally, or in a particular country or countries, may not take place on all business days in New York and on which the NAV of a Portfolio is calculated.
The Valuation Committee of Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), which meets periodically under the direction of the Board of Directors (the “Board”), may evaluate a variety of factors to determine the fair value of securities for which market quotations are determined not to be readily available or reliable. These factors include, but are not limited to, the type of security, the value of comparable securities, observations from financial institutions and relevant news events. Input from the Investment Manager’s portfolio managers/analysts also will be considered.
228 Semi-Annual Report
If a significant event materially affecting the value of securities occurs between the close of the exchange or market on which the security is principally traded and the time when a Portfolio’s NAV is calculated, or when current market quotations otherwise are determined not to be readily available or reliable (including restricted or other illiquid securities such as certain derivative instruments), such securities will be valued at their fair value as determined by, or in accordance with procedures approved by, the Board. The fair value of non-US securities may be determined with the assistance of an independent pricing service using correlations between the movement of prices of such securities and indices of US securities and other appropriate indicators, such as closing market prices of relevant American Depository Receipts (“ADRs”) or futures contracts. Non-US securities may trade on days when a Portfolio is not open for business, thus affecting the value of the Portfolio’s assets on days when Portfolio shareholders may not be able to buy or sell Portfolio shares.
The effect of using fair value pricing is that the NAV of a Portfolio will reflect the affected securities’ values as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price securities may result in a value that is different from the most recent closing price of a security and from the prices used by other investment companies to calculate their portfolios’ NAVs.
(b) Portfolio Securities Transactions and Investment Income—Portfolio securities transactions are accounted for on trade date. Realized gain (loss) on sales of investments are recorded on a specific identification basis. Dividend income is recorded on the ex-dividend date except for certain dividends from non-US securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by a Portfolio. Interest income, if any, is accrued daily.
A Portfolio may be subject to taxes imposed by non-US countries in which it invests. Such taxes are generally based upon income earned or capital gains (realized and/or unrealized). An affected Portfolio accrues and applies such taxes to net investment income,
Semi-Annual Report 229
net realized gains and net unrealized gains concurrent with the recognition of income earned or capital gains (realized and/or unrealized) from the applicable portfolio securities.
As a result of several court cases in certain countries across the European Union, some Portfolios have filed tax reclaims for previously withheld taxes on dividends earned in certain European Union countries. These filings are subject to various administrative proceedings by the local jurisdictions’ tax authorities within the European Union, as well as a number of related judicial proceedings. Uncertainty exists as to the ultimate resolution of these proceedings, the likelihood of receipt of these claims, and the potential timing of payment, and accordingly no amounts are reflected in the financial statements. Such amounts, if and when recorded, could result in an increase in a Portfolio’s NAV per share.
(c) Foreign Currency Translation and Forward Currency Contracts—The accounting records of the Fund are maintained in US dollars. Portfolio securities and other assets and liabilities denominated in a foreign currency are translated daily into US dollars at the prevailing rates of exchange. Purchases and sales of securities, income receipts and expense payments are translated into US dollars at the prevailing exchange rates on the respective transaction dates.
The Portfolios do not isolate the portion of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in their market prices. Such fluctuations are included in net realized and unrealized gain (loss) on investments. Net realized gain (loss) on foreign currency transactions and forward currency contracts represent net foreign currency gain (loss) from forward currency contracts, disposition of foreign currencies, currency gain (loss) realized between the trade and settlement dates on securities transactions, and the difference between the amount of dividends, interest and foreign withholding taxes recorded on the Portfolios’ accounting records and the US dollar equivalent amounts actually received or paid. Net change in unrealized appreciation (depreciation) on foreign currency translations reflects the impact of changes in exchange rates
230 Semi-Annual Report
on the value of assets and liabilities, other than investments in securities, during the period.
A forward currency contract is an agreement between two parties to buy or sell currency at a set price on a future date. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of the foreign currency relative to the US dollar.
The US dollar value of forward currency contracts is determined using quotations provided by an independent pricing service. Daily fluctuations in the value of such contracts are recorded as unrealized appreciation (depreciation) on forward currency contracts. When the contract is closed, a Portfolio records a realized gain (loss) equal to the difference between the value at the time it was opened and the value at the time it was closed.
During the period ended June 30, 2019, the Global Listed Infrastructure Portfolio traded in forward currency contracts.
(d) Federal Income Taxes—The Fund’s policy is to have each Portfolio qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and to distribute all of its taxable income, including any net realized capital gains, to shareholders. Therefore, no federal income tax provision is required.
At December 31, 2018, the following Portfolios had unused realized capital loss carryovers which, for federal income tax purposes, could be used to offset future realized capital gains with no expiration date as follows:
Portfolio | Short-Term | Long-Term | ||||||
Developing Markets Equity | $ | 42,311,826 | $ | 81,496,065 | ||||
Emerging Markets Core Equity | 2,480,814 | — | ||||||
Emerging Markets Equity Blend | 11,274,953 | 38,896,176 | ||||||
Emerging Markets Equity | 95,082,877 | 676,889,120 | ||||||
International Equity Value | 525,300 | — |
Under current tax law, post- October capital losses or certain late year ordinary losses, as defined by the Code, within the taxable
Semi-Annual Report 231
year may be deferred and treated as occurring on the first day of the following tax year. For the tax year ended December 31, 2018, the following Portfolios elected to defer such losses as follows:
Portfolio | Post-October Capital Loss Deferral | Late-Year Ordinary Loss Deferral | |||||||
Emerging Markets Equity Advantage | $ | 66,380 | $ | — | |||||
Global Equity Select | 330,136 | — | |||||||
Global Listed Infrastructure | 5,706,036 | — | |||||||
International Equity Advantage | 28,394 | 2,517 | |||||||
International Equity Concentrated | 1,810,394 | 313 | |||||||
International Equity | 41,680,902 | — | |||||||
International Equity Select | 363,804 | 9,494 | |||||||
International Equity Value | — | 1,770 | |||||||
International Strategic Equity | 1,231,230 | — | |||||||
Managed Equity Volatility | 261,488 | — | |||||||
US Equity Concentrated | 14,024,506 | — | |||||||
US Equity Select | 228,014 | — | |||||||
US Small-Mid Cap Equity | 1,910,623 | — |
For federal income tax purposes, the aggregate cost, aggregate gross unrealized appreciation, aggregate gross unrealized depreciation and the net unrealized appreciation (depreciation) were as follows:
Portfolio | Aggregate Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | ||||||||||||
Developing Markets Equity | $ | 221,831,542 | $ | 31,287,930 | $ | 10,963,712 | $ | 20,324,218 | ||||||||
Emerging Markets Core Equity | 220,741,602 | 25,236,185 | 15,324,582 | 9,911,603 | ||||||||||||
Emerging Markets Equity Advantage | 9,374,032 | 883,124 | 297,744 | 585,380 | ||||||||||||
Emerging Markets Equity Blend | 96,407,909 | 7,001,647 | 5,576,383 | 1,425,264 | ||||||||||||
Emerging Markets Equity | 7,884,933,417 | 1,350,359,295 | 904,326,516 | 446,032,779 | ||||||||||||
Equity Franchise | 37,858,698 | 1,060,241 | 1,931,310 | (871,069 | ) | |||||||||||
Global Equity Select | 59,971,139 | 13,668,296 | 1,659,478 | 12,008,818 | ||||||||||||
Global Listed Infrastructure | 6,334,813,350 | 629,696,573 | 245,501,525 | 384,195,048 | ||||||||||||
Global Strategic Equity | 2,608,866 | 546,353 | 73,855 | 472,498 | ||||||||||||
International Equity Advantage | 2,388,914 | 176,539 | 162,853 | 13,686 |
232 Semi-Annual Report
Portfolio | Aggregate Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | ||||||||||||
International Equity Concentrated | $ | 83,716,564 | $ | 5,540,055 | $ | 2,313,310 | $ | 3,226,745 | ||||||||
International Equity | 2,576,428,768 | 374,502,936 | 78,459,797 | 296,043,139 | ||||||||||||
International Equity Select | 86,773,009 | 8,354,741 | 3,778,223 | 4,576,518 | ||||||||||||
International Equity Value | 25,273,601 | 1,344,001 | 1,643,647 | (299,646 | ) | |||||||||||
International Small Cap Equity | 53,912,384 | 6,428,113 | 4,288,510 | 2,139,603 | ||||||||||||
International Strategic Equity | 5,538,415,103 | 998,538,995 | 194,183,929 | 804,355,066 | ||||||||||||
International Quality Growth | 3,058,795 | 606,154 | 28,675 | 577,479 | ||||||||||||
Managed Equity Volatility | 23,975,017 | 2,140,304 | 572,474 | 1,567,830 | ||||||||||||
US Equity Concentrated | 1,090,007,758 | 207,076,637 | 9,756,083 | 197,320,554 | ||||||||||||
US Equity Select | 65,507,840 | 14,008,731 | 612,243 | 13,396,488 | ||||||||||||
US Realty Equity | 55,641,847 | 10,848,358 | 1,001,256 | 9,847,102 | ||||||||||||
US Small-Mid Cap Equity | 75,631,067 | 9,733,370 | 3,025,074 | 6,708,296 |
Management has analyzed the Portfolios’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on tax returns filed for any open tax years (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction’s statute of limitations. Each Portfolio files a US federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal Revenue Service for a period of three years from the date of filing.
(e) Dividends and Distributions—Dividends from net investment income, if any, will be declared and paid annually, except that the Global Listed Infrastructure Portfolio’s dividends from net investment income (if any), will be declared and paid quarterly. During any particular year, net realized gains from investment transactions in excess of available capital loss carryforwards would be taxable to the Portfolios, if not distributed. The Portfolios intend to declare and distribute these amounts, at least annually, to shareholders; however, to avoid taxation, a second distribution may be
Semi-Annual Report 233
required. Differences in per share distributions, by class, are generally due to differences in class specific expenses.
REIT distributions received by a Portfolio are generally comprised of ordinary income, long-term capital gains and a return of REIT capital. However, as the actual character of such distributions received are not known until after the calendar year end, distributions made by a Portfolio during the year are subject to re-characterization that may result in some portion of the distributions being reclassified as a return of capital distribution to Portfolio shareholders.
Income and capital gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These book/tax differences, which may result in distribution reclassifications, are primarily due to differing treatments of foreign currency transactions, wash sales, passive foreign investment companies, expiring capital loss carryovers, certain expenses, foreign capital gains taxes, distributions in excess of current earnings, equalization, non-REIT non-taxable dividend adjustment to income, distributions redesignations, adjustments in relation to merger, return of capital distributions and distributions from real estate investment trusts and partnerships. The book/tax differences relating to shareholder distributions may result in reclassifications among certain capital accounts.
(f) Offering and Organizational Costs—Costs incurred by the Fund in connection with the offering of shares of a new Portfolio or share class of a Portfolio are deferred and amortized on a straight line basis over a twelve-month period from the date of commencement of operations of the Portfolio or share class. Organizational costs are expensed as incurred.
(g) Allocation of Expenses—Expenses common to the Fund, Lazard Retirement Series, Inc., Lazard Global Total Return and Income Fund, Inc. and Lazard World Dividend & Income Fund, Inc. (each a “Lazard Fund” and collectively, the “Lazard Fund Complex”), each a registered management investment company advised by the Investment Manager, not directly chargeable to one or more specific Lazard Funds are allocated to the Fund and among its Portfolios primarily on the basis of relative net assets.
234 Semi-Annual Report
Expenses of the Fund not directly chargeable to one or more Portfolios are similarly allocated among the Portfolios on the basis of relative net assets. Portfolios accrue distribution and service (12b-1) fees to Open Shares. The Portfolios’ income, expenses (other than class specific expenses) and realized and unrealized gains and losses are allocated proportionally each day between the classes based upon the relative net assets of each class.
(h) Redemption Fee—Until August 15, 2016, the Portfolios imposed a 1.00% redemption fee (short-term trading fee) on Portfolio shares redeemed less than 30 days after such shares were acquired. The fees were retained by the Portfolios and are included as paid in capital on the Statements of Assets and Liabilities. As of August 15, 2016, redemption fees no longer apply to transactions in Portfolio shares.
(i) Estimates—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
(j) Net Asset Value—NAV per share for each class of each Portfolio is determined each day the NYSE is open for trading as of the close of regular trading on the NYSE (generally 4:00 p.m. Eastern time). The Fund will not treat an intraday unscheduled disruption in NYSE trading as a closure of the NYSE, and will price its shares as of 4:00 p.m., if the particular disruption directly affects only the NYSE. NAV per share is determined by dividing the value of the total assets of the Portfolio represented by such class, less all liabilities, by the total number of Portfolio shares of such class outstanding.
3. Investment Management, Administration, Custody, Distribution and Transfer Agency Agreements
The Fund, on behalf of the Portfolios, has entered into a management agreement (the “Management Agreement”) with the Investment Manager. Pursuant to the Management Agreement, the Investment Manager regularly provides each Portfolio with invest-
Semi-Annual Report 235
ment research, advice and supervision and furnishes continuously an investment program for each Portfolio consistent with its investment objectives and policies, including the purchase, retention and disposition of securities, and provides the Portfolios with administrative, operational and compliance assistance services. For its services provided to the Portfolios, the Investment Manager earns a management fee, accrued daily as a percentage of each Portfolio’s average daily net assets and payable by each Portfolio monthly, at the annual rate set forth below:
Portfolio | Annual Rate | ||||
Developing Markets Equity | 1.00 | % | |||
Emerging Markets Core Equity | 1.00 | ||||
Emerging Markets Equity Advantage | 0.85 | ||||
Emerging Markets Equity Blend | 1.00 | ||||
Emerging Markets Equity | 1.00 | ||||
Equity Franchise | 0.80 | ||||
Global Equity Select | 0.80 | ||||
Global Listed Infrastructure | 0.90 | ||||
Global Strategic Equity | 0.75 | ||||
International Equity Advantage | 0.65 | ||||
International Equity Concentrated | 0.80 | ||||
International Equity | 0.75 | ||||
International Equity Select | 0.75 | ||||
International Equity Value | 0.80 | ||||
International Small Cap Equity | 0.75 | ||||
International Strategic Equity | 0.75 | ||||
International Quality Growth | 0.75 | ||||
Managed Equity Volatility | 0.60 | ||||
US Equity Concentrated | 0.70 | ||||
US Equity Select | 0.65 | ||||
US Realty Equity | 0.75 | ||||
US Small-Mid Cap Equity | 0.75 |
The Investment Manager has voluntarily agreed, until May 1 of the year shown below (except as noted), to waive its fees and, if necessary, reimburse the Portfolios if the aggregate direct expenses of the Portfolios, exclusive of taxes, brokerage, interest on borrowings, fees and expenses of “Acquired Funds” (as defined in Form N-1A) and extraordinary expenses including, for the purposes of the expense limitation agreement only, fees related to filing foreign tax reclaims exceed the percentages of the value of the Port-
236 Semi-Annual Report
folio’s average daily net assets set forth opposite the Portfolio’s name on table below. The Fund, on behalf of the Portfolio, may deduct from the payment to be made to the Investment Manager under the Management Agreement, or the Investment Manager will bear, such excess expense.
Portfolio | Institutional Shares | Open Shares | R6 Shares | Year | ||||||||||||
Developing Markets Equity | 1.25 | % | 1.55 | % | N/A | % | 2020 | |||||||||
Emerging Markets Core Equity | 1.25 | 1.55 | 1.20 | 2020 | ||||||||||||
Emerging Markets Equity Advantage | 1.10 | 1.40 | N/A | 2020 | ||||||||||||
Emerging Markets Equity Blend | 1.25 | 1.55 | N/A | 2020 | ||||||||||||
Emerging Markets Equity | 1.20 | 1.50 | 1.15 | 2020 | ||||||||||||
Equity Franchise | 0.95 | 1.20 | N/A | 2020 | ||||||||||||
Global Equity Select | 1.05 | 1.35 | N/A | 2020 | ||||||||||||
Global Listed Infrastructure | 1.20 | 1.50 | N/A | 2029 | (a) | |||||||||||
Global Strategic Equity | 1.00 | 1.30 | N/A | 2020 | ||||||||||||
International Equity Advantage | 0.90 | 1.20 | N/A | 2020 | ||||||||||||
International Equity Concentrated | 0.95 | 1.25 | N/A | 2020 | ||||||||||||
International Equity | 0.85 | 1.15 | 0.80 | 2020 | ||||||||||||
International Equity Select | 1.05 | 1.35 | N/A | 2020 | (b) | |||||||||||
International Equity Value | 0.95 | 1.20 | N/A | 2020 | (c) | |||||||||||
International Small Cap Equity | 1.13 | 1.43 | N/A | 2020 | ||||||||||||
International Strategic Equity | 1.05 | 1.35 | 1.00 | 2020 | ||||||||||||
International Quality Growth | 0.85 | 1.10 | N/A | 2020 | (d) | |||||||||||
Managed Equity Volatility | 0.75 | 1.05 | N/A | 2020 | ||||||||||||
US Equity Concentrated | 0.90 | 1.20 | 0.85 | 2020 | (e) | |||||||||||
US Equity Select | 0.75 | 1.05 | 0.75 | 2020 | ||||||||||||
US Realty Equity | 1.00 | 1.30 | N/A | 2029 | (a) | |||||||||||
US Small-Mid Cap Equity | 1.15 | 1.45 | N/A | 2020 |
(a) | Agreement is through May 1, 2029. |
(b) | Agreement extends from May 1, 2020 through May 2029, at levels of 1.15% and 1.45%, respectively. |
(c) | Agreement is until October 31, 2020. |
(d) | Agreement is until December 31, 2020. |
(e) | Agreement extends from May 1, 2020 through May 1 2029, at levels of 1.10%, 1.40%, and 1.05%, respectively. |
In addition, until May 1, 2020, to the extent the “Total Annual Fund Operating Expenses” (as used in Form N-1A) of the R6 Shares of a Portfolio exceed the Total Annual Fund Operating Expenses of the Portfolio’s Institutional Shares (in each case, not including management fees, custodial fees or other expenses related to the management of the Portfolio’s assets), the Investment Manager will bear the expenses of the R6 Shares in the amount of such excess.
Semi-Annual Report 237
During the period ended June 30, 2019, the Investment Manager waived its management fees and reimbursed the following Portfolios for other expenses as follows:
Institutional Shares | Open Shares | ||||||||||||||||
Portfolio | Management Fees Waived | Expenses Reimbursed | Management Fees Waived | Expenses Reimbursed | |||||||||||||
Emerging Markets Core Equity | $ | — | $ | — | $ | 34 | $ | — | |||||||||
Emerging Markets Equity Advantage | 29,685 | 44,975 | 3,816 | 6,781 | |||||||||||||
Equity Franchise | 59,632 | — | 860 | 1,478 | |||||||||||||
Global Equity Select | 4,678 | — | 1,317 | — | |||||||||||||
Global Strategic Equity | 10,319 | 60,751 | 523 | 4,358 | |||||||||||||
International Equity Advantage | 7,185 | 73,361 | 338 | 4,725 | |||||||||||||
International Equity Concentrated | 37,529 | — | 1,495 | — | |||||||||||||
International Equity Select | — | — | 612 | — | |||||||||||||
International Equity Value | 98,430 | 19,061 | 246 | 1,407 | |||||||||||||
International Quality Growth | 12,092 | 73,893 | 23 | 1,524 | |||||||||||||
Managed Equity Volatility | 69,447 | 4,940 | 600 | 1,365 | |||||||||||||
US Equity Select | 46,646 | — | 1,908 | — | |||||||||||||
US Realty Equity | 2,277 | — | — | — |
R6 Shares | |||||||||
Portfolio | Management Fees Waived | Expenses Reimbursed | |||||||
Emerging Markets Core Equity | $ | 2,654 | $ | 251 | |||||
International Equity | 8,297 | — | |||||||
International Strategic Equity | 2,537 | — | |||||||
US Equity Concentrated | 1,274 | — | |||||||
US Equity Select | 9,392 | — |
The aforementioned waivers and/or reimbursements are not subject to recoupment by the Investment Manager.
State Street provides the Fund with custody and certain fund administration and accounting services.
In December 2015, State Street announced that it had identified inconsistencies in the way in which clients were invoiced for custody out-of-pocket expenses from 1998 until 2015. The difference between what was charged and what should have been charged, plus interest, was recorded as a reimbursement when determined in 2016. Pursuant to the expense limitations described above, certain Portfolios experienced management fee waivers during the year ended December 31, 2016. Accordingly, the reimbursement of out-of-pocket expenses resulted in the reduction in the waiver
238 Semi-Annual Report
of management fees for certain Portfolios for the year ended December 31, 2016.
The Fund has a distribution agreement with Lazard Asset Management Securities LLC (the “Distributor”), a wholly-owned subsidiary of the Investment Manager, to serve as the distributor for shares of each Portfolio. The Distributor bears the cost of printing and mailing prospectuses to potential investors and certain expenses in connection with the offering of Portfolio shares.
Under a distribution and servicing plan adopted pursuant to Rule 12b-1 under the 1940 Act, each Portfolio pays a monthly fee to the Distributor, at an annual rate of 0.25% of the average daily net assets of its Open Shares, for distribution and servicing of accounts. The Distributor may make payments to certain financial institutions, securities dealers and other industry professionals for providing these services.
DST is the Fund’s transfer and dividend disbursing agent. During the period ended June 30, 2019, DST waived $6,107 and $10,167 of its fees for the International Quality Growth and International Equity Value Portfolio, respectively.
4. Directors’ Compensation
Certain Directors of the Fund are officers of the Investment Manager. For the period ended June 30, 2019, each Director who is not an affiliated person of the Investment Manager or any of its affiliates was paid by all of the funds in the Lazard Fund Complex: (1) an annual retainer of $232,000, (2) an additional annual fee of $33,000 to the lead Independent Director (an “Independent Director” is a Director who is not an “interested person” (as defined in the 1940 Act) of the Fund), and (3) an additional annual fee of $23,000 to the Audit Committee Chair. The Independent Directors may be paid additional compensation for participation on ad hoc committees or other work performed on behalf of the Board. The Independent Directors also are reimbursed for travel and other out- of- pocket expenses for attending Board and committee meetings. The Directors do not receive benefits from the Fund pursuant to any pension, retirement or similar arrangement. Independent
Semi-Annual Report 239
Directors’ fees are allocated among the funds in the Lazard Fund Complex at a rate of $5,000 per fund with the remainder allocated based upon each fund’s proportionate share of combined net assets. The Statements of Operations show the Independent Directors’ fees and expenses paid by each Portfolio.
5. Securities Transactions and Transactions with Affiliates
Purchases and sales of portfolio securities (excluding short-term investments) for the period ended June 30, 2019 were as follows:
Portfolio | Purchases | Sales | ||||||
Developing Markets Equity | $ | 91,341,186 | $ | 109,727,078 | ||||
Emerging Markets Core Equity | 24,385,527 | 29,318,392 | ||||||
Emerging Markets Equity Advantage | 8,221,595 | 2,232,482 | ||||||
Emerging Markets Equity Blend | 88,012,269 | 321,120,857 | ||||||
Emerging Markets Equity | 748,125,794 | 2,129,264,938 | ||||||
Equity Franchise | 37,724,013 | –9,587,512 | ||||||
Global Equity Select | 10,138,020 | 9,780,951 | ||||||
Global Listed Infrastructure | 1,576,499,208 | 1,101,142,171 | ||||||
Global Strategic Equity | 610,514 | 703,680 | ||||||
International Equity Advantage | 734,777 | 790,998 | ||||||
International Equity Concentrated | 47,770,368 | 23,485,971 | ||||||
International Equity | 527,760,227 | 417,876,039 | ||||||
International Equity Select | 19,988,928 | 15,473,634 | ||||||
International Equity Value | 22,481,916 | 21,809,727 | ||||||
International Quality Growth | 6,725,335 | 3,805,497 | ||||||
International Small Cap Equity | 11,300,647 | 16,446,196 | ||||||
International Strategic Equity | 870,884,889 | 956,851,409 | ||||||
Managed Equity Volatility | 14,274,770 | 12,772,651 | ||||||
US Equity Concentrated | 262,178,348 | 333,782,823 | ||||||
US Equity Select | 18,312,995 | 25,911,447 | ||||||
US Realty Equity | 7,391,082 | 13,303,682 | ||||||
US Small-Mid Cap Equity | 44,648,990 | 115,518,517 |
For the period ended June 30, 2019, the Portfolios did not engage in any cross-trades in accordance with Rule 17a-7 under the 1940 Act, and no brokerage commissions were paid to affiliates of the Investment Manager or other affiliates of the Fund for portfolio transactions executed on behalf of the Fund.
At June 30, 2019, the Investment Manager owned 24.85%, 15.06%, 94.30%, 95.10% and 89.85% of the outstanding shares of the
240 Semi-Annual Report
Emerging Markets Equity Advantage, Equity Franchise, Global Strategic Equity, International Quality Growth and International Equity Advantage Portfolios, respectively.
Holdings of 5% Voting Securities of Portfolio Companies
The 1940 Act defines “affiliated persons” to include a portfolio company in which a Portfolio owns 5% or more of the outstanding voting securities. Investments in “affiliated persons” for the Emerging Markets Equity Portfolio for the period ended June 30, 2019 were as follows:
Non-Controlled Affiliates | Number of Shares Held at December 31, 2018 | Gross Additions | Gross Reductions | Number of Shares Held at June 30, 2019 | |||||||||||||
Imperial Logistics, Ltd. * | 7,191,474 | — | (5,181,391 | ) | 2,010,083 | ||||||||||||
Weichai Power Co., Ltd., Class H * | 118,270,288 | — | (23,471,000 | ) | 94,799,288 |
Non-Controlled Affiliates | Fair Value at June 30, 2019 | Investment Income | Realized Gain (Loss) | ||||||||||
Imperial Logistics, Ltd.* | $ | 7,342,755 | $ | 485,533 | $ | (11,393,823 | ) | ||||||
Weichai Power Co., Ltd., Class H* | 160,452,464 | — | 9,037,714 | ||||||||||
Total Securities | $ | 167,795,219 | $ | 485,533 | $ | (2,356,109 | ) |
* | This security was deemed to no longer meet the criteria of an affiliated company at the reporting date. For financial statement purposes, the total change in unrealized depreciation of $(27,195,519) is included in the Statement of Operations. |
6. Line of Credit
The Fund has a $50 million Line of Credit Agreement (the “Agreement”) with State Street, primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. Interest on borrowings is payable at the higher of the Federal Funds rate or One-Month LIBOR rate plus 1.00%, on an annualized basis. Under the Agreement, the Fund has agreed to pay a 0.20% per annum fee on the unused portion of the commitment, payable quarterly in arrears. The Fund has also agreed to pay an upfront fee of 0.05% of the committed line amount. During the period ended June 30, 2019, the following Portfolios had borrowings under the Agreement as follows:
Semi-Annual Report 241
Portfolio | Average Daily Loan Balance* | Maximum Daily Loan Outstanding | Weighted Average Interest Rate | Number of Days Borrowings were Outstanding | ||||||||||||||
Developing Markets Equity | $ | 7,303,333 | $ | 13,375,000 | 3.44 | % | 3 | |||||||||||
Emerging Markets Core Equity | 871,250 | 1,260,000 | 3.42 | 4 | ||||||||||||||
Emerging Markets Equity Blend | 19,499,743 | 47,672,499 | 3.42 | 6 | ||||||||||||||
Equity Franchise | 105,000 | 105,000 | 3.48 | 4 | ||||||||||||||
International Equity Concentrated | 330,000 | 330,000 | 3.51 | 1 | ||||||||||||||
International Small Cap Equity | 392,000 | 480,000 | 3.44 | 5 | ||||||||||||||
US Equity Select | 255,000 | 255,000 | 3.48 | 1 | ||||||||||||||
US Realty Equity | 605,000 | 1,190,000 | 3.49 | 4 |
* | For days borrowings were outstanding. |
Management believes that the fair value of the liabilities under the line of credit is equivalent to the recorded amount based on its short-term maturity and interest rate, which fluctuates with LIBOR. A Portfolio’s outstanding balance on the line of credit, if any, would be categorized as Level 2.
7. Investment Risks
(a) Non-US Securities Risk—A Portfolio’s performance will be influenced by political, social and economic factors affecting the non-US countries and companies in which the Portfolio invests. Non-US securities carry special risks, such as less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less liquidity.
(b) Emerging Market Risk—Emerging market countries generally have economic structures that are less diverse and mature, and political systems that are less stable, than those of developed countries. The economies of countries with emerging markets may be based predominantly on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme debt burdens or volatile inflation rates. The securities markets of emerging market countries have historically been extremely volatile. These market conditions may continue or worsen. Investments in these countries may be subject to political,
242 Semi-Annual Report
economic, legal, market and currency risks. The risks may include less protection of property rights and uncertain political and economic policies, the imposition of capital controls and/or foreign investment limitations by a country, nationalization of businesses and the imposition of sanctions by other countries, such as the US. Significant devaluation of emerging market currencies against the US dollar may occur subsequent to acquisition of investments denominated in emerging market currencies.
(c) Foreign Currency Risk—Investments denominated in currencies other than US dollars may experience a decline in value, in US dollar terms, due solely to fluctuations in currency exchange rates. A Portfolio’s currency investments could be adversely affected by delays in, or a refusal to grant, repatriation of funds or conversion of emerging market currencies. For Portfolios other than the Global Listed Infrastructure Portfolio, the Investment Manager generally does not intend to actively hedge the Portfolio’s foreign currency exposure.
(d) Infrastructure Companies Risk—Securities and instruments of infrastructure companies are more susceptible to adverse economic or regulatory occurrences affecting their industries. Infrastructure companies may be subject to a variety of factors that may adversely affect their business or operations, including high interest costs in connection with capital construction programs, high leverage, costs associated with environmental and other regulations, the effects of economic slowdown, surplus capacity, increased competition from other providers of services, uncertainties concerning the availability of fuel at reasonable prices, the effects of energy conservation policies and other factors. Infrastructure companies also may be affected by or subject to: regulation by various government authorities, including rate regulation; service interruption due to environmental, operational or other mishaps; the imposition of special tariffs and changes in tax laws, regulatory policies and accounting standards; general changes in market sentiment towards infrastructure and utilities assets; difficulty in raising capital in adequate amounts on reasonable terms in periods of high inflation and unsettled capital markets; inexperience with and potential losses resulting from a developing dereg-
Semi-Annual Report 243
ulatory environment; and technological innovations that may render existing plants, equipment or products obsolete.
(e) Realty Companies, Real Estate Investments and REITs Risk—Portfolios that invest in Realty Companies (as defined in the Fund’s prospectus), Real Estate Investments and/or Real Estate Investment Trusts (REITs) could lose money due to the performance of real estate-related securities even if securities markets generally are experiencing positive results. The performance of investments made by a Portfolio may be determined to a great extent by the current status of the real estate industry in general, or by other factors (such as interest rates and the availability of loan capital) that may affect the real estate industry, even if other industries would not be so affected. Consequently, the investment strategies of a Portfolio could lead to securities investment results that may be significantly different from investments in securities of other industries or sectors or in a more broad-based portfolio generally.
The risks related to investments in Realty Companies and Real Estate Investments include, but are not limited to: adverse changes in general economic and local market conditions; adverse developments in employment; changes in supply or demand for similar or competing properties; unfavorable changes in applicable taxes, governmental regulations and interest rates; operating or development expenses; and lack of available financing.
REITS are subject to similar risks as Real Estate Investments and Realty Companies. The risks related to investments in Real Estate Investments and Realty Companies include, but are not limited to: adverse changes in general economic and local market conditions; adverse developments in employment; changes in supply or demand for similar or competing properties; unfavorable changes in applicable taxes, governmental regulations and interest rates; operating or development expenses; and lack of available financing. Due to certain special considerations that apply to REITs, investments in REITs may carry additional risks not necessarily present in investments in other securities. REIT securities (including those trading on national exchanges) typically have trading volumes that are less than those of common stocks of other stocks
244 Semi-Annual Report
traded on national exchanges, which may affect a Portfolio’s ability to trade or liquidate those securities. An investment in REITs may be adversely affected if the REIT fails to comply with applicable laws and regulations. Failure to qualify with any of these requirements could jeopardize a company’s status as a REIT. A Portfolio generally will have no control over the operations and policies of a REIT, and they generally will have no ability to cause a REIT to take the actions necessary to qualify as a REIT.
(f) Non-Diversification Risk—A Portfolio’s NAV may be more vulnerable to changes in the market value of a single issuer or group of issuers and may be relatively more susceptible to adverse effects from any single corporate, industry, economic, market, political or regulatory occurrence than if the Portfolio’s investments consisted of securities issued by a larger number of issuers.
(g) Forward Currency Contracts Risk—Forward currency contracts may increase volatility or reduce returns, perhaps substantially, particularly since most derivatives have a leverage component that provides investment exposure in excess of the amount invested. Forward currency contracts are subject to the risk of default by the counterparty to the contracts and can be illiquid. These contracts are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related currency. As such, a small investment could have a potentially large impact on the Portfolio’s performance. Derivatives transactions incur costs, either explicitly or implicitly, which reduce return. Successful use of derivatives is subject to the Investment Manager’s ability to predict correctly movements in the direction of the relevant reference asset or market. Use of forward currency contracts, even when entered into for hedging purposes, may cause the Portfolio to experience losses greater than if the Portfolio had not engaged in such transactions.
8. Contractual Obligations
The Fund enters into contracts in the normal course of business that contain a variety of indemnification provisions. A Portfolio’s maximum exposure under these arrangements is unknown. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.
Semi-Annual Report 245
9. Fair Value Measurements
Fair value is defined as the price that a Portfolio would receive to sell an asset, or would pay to transfer a liability, in an orderly transaction between market participants at the date of measurement. The Fair Value Measurements and Disclosures provisions of GAAP also establish a framework for measuring fair value, and a three-level hierarchy for fair value measurement that is based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer, broadly, to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions about the assumptions that market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances. The fair value measurement level within the fair value hierarchy for the assets and liabilities of the Fund is based on the lowest level of any input that is significant to the overall fair value measurement. The three-level hierarchy of inputs is summarized below:
• | Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities |
• | Level 2 – other significant observable inputs (including unadjusted quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.) |
• | Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities) |
Changes in valuation technique may result in transfers into or out of the current assigned level within the hierarchy.
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in these securities.
246 Semi-Annual Report
The following table summarizes the valuation of the Portfolios’ assets and liabilities by each fair value hierarchy level as of June 30, 2019:
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Developing Markets Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Brazil | $ | 18,913,775 | $ | — | $ | — | $ | 18,913,775 | |||||||||
Canada | 2,631,869 | — | — | 2,631,869 | |||||||||||||
China | 22,782,049 | 46,875,926 | — | 69,657,975 | |||||||||||||
Colombia | 6,367,087 | — | — | 6,367,087 | |||||||||||||
Hong Kong | — | 4,085,461 | — | 4,085,461 | |||||||||||||
India | 13,890,222 | 8,847,786 | — | 22,738,008 | |||||||||||||
Indonesia | — | 6,515,012 | — | 6,515,012 | |||||||||||||
Macau | — | 1,784,448 | — | 1,784,448 | |||||||||||||
Mexico | 3,831,318 | — | — | 3,831,318 | |||||||||||||
Peru | 5,781,122 | — | — | 5,781,122 | |||||||||||||
Philippines | — | 3,598,668 | — | 3,598,668 | |||||||||||||
Portugal | — | 6,431,898 | — | 6,431,898 | |||||||||||||
Russia | 7,194,730 | 13,239,663 | — | 20,434,393 | |||||||||||||
South Africa | — | 9,164,773 | — | 9,164,773 | |||||||||||||
South Korea | — | 22,078,006 | — | 22,078,006 | |||||||||||||
Taiwan | 2,995,650 | 17,237,851 | — | 20,233,501 | |||||||||||||
United Arab Emirates | — | 3,054,209 | — | 3,054,209 | |||||||||||||
United Kingdom | — | 3,749,738 | — | 3,749,738 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Brazil | 5,321,095 | — | — | 5,321,095 | |||||||||||||
Short-Term Investments | 5,783,404 | — | — | 5,783,404 | |||||||||||||
Total | $ | 95,492,321 | $ | 146,663,439 | $ | — | $ | 242,155,760 |
Semi-Annual Report 247
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Emerging Markets Core Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Argentina | $ | 1,675,496 | $ | — | $ | — | $ | 1,675,496 | |||||||||
Brazil | 20,266,041 | — | — | 20,266,041 | |||||||||||||
Canada | 2,390,508 | — | — | 2,390,508 | |||||||||||||
China | 19,046,027 | 43,923,827 | — | 62,969,854 | |||||||||||||
Colombia | 2,710,224 | — | — | 2,710,224 | |||||||||||||
Hong Kong | — | 2,810,596 | — | 2,810,596 | |||||||||||||
Hungary | — | 2,226,738 | — | 2,226,738 | |||||||||||||
India | 12,058,136 | 12,539,906 | — | 24,598,042 | |||||||||||||
Indonesia | 2,086,567 | 3,286,225 | — | 5,372,792 | |||||||||||||
Luxembourg | 3,862,900 | — | — | 3,862,900 | |||||||||||||
Mexico | 7,440,429 | — | — | 7,440,429 | |||||||||||||
Peru | 2,643,911 | — | — | 2,643,911 | |||||||||||||
Philippines | — | 4,604,249 | — | 4,604,249 | |||||||||||||
Portugal | — | 2,155,924 | — | 2,155,924 | |||||||||||||
Russia | 820,261 | 15,720,753 | — | 16,541,014 | |||||||||||||
South Africa | — | 12,564,219 | — | 12,564,219 | |||||||||||||
South Korea | — | 22,556,927 | — | 22,556,927 | |||||||||||||
Taiwan | 12,306,766 | 8,372,665 | — | 20,679,431 | |||||||||||||
Thailand | — | 3,169,967 | — | 3,169,967 | |||||||||||||
United Kingdom | 4,201,824 | — | — | 4,201,824 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Brazil | 1,922,085 | — | — | 1,922,085 | |||||||||||||
Short-Term Investments | 3,290,034 | — | — | 3,290,034 | |||||||||||||
Total | $ | 96,721,209 | $ | 133,931,996 | $ | — | $ | 230,653,205 |
248 Semi-Annual Report
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Emerging Markets Equity Advantage Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Argentina | $ | 54,008 | $ | — | $ | — | $ | 54,008 | |||||||||
Brazil | 532,124 | — | — | 532,124 | |||||||||||||
Chile | 71,981 | — | — | 71,981 | |||||||||||||
China | 571,524 | 2,545,378 | — | 3,116,902 | |||||||||||||
Colombia | 39,744 | — | — | 39,744 | |||||||||||||
Egypt | 35,620 | — | — | 35,620 | |||||||||||||
Greece | — | 12,915 | — | 12,915 | |||||||||||||
Hong Kong | — | 42,491 | — | 42,491 | |||||||||||||
Hungary | — | 93,404 | — | 93,404 | |||||||||||||
India | 453,466 | 254,211 | — | 707,677 | |||||||||||||
Indonesia | — | 252,675 | — | 252,675 | |||||||||||||
Malaysia | — | 216,507 | — | 216,507 | |||||||||||||
Mexico | 313,774 | — | — | 313,774 | |||||||||||||
Peru | 17,626 | — | — | 17,626 | |||||||||||||
Philippines | — | 166,965 | — | 166,965 | |||||||||||||
Poland | — | 91,751 | — | 91,751 | |||||||||||||
Russia | — | 522,528 | — | 522,528 | |||||||||||||
South Africa | — | 398,693 | — | 398,693 | |||||||||||||
South Korea | 49,705 | 1,315,450 | — | 1,365,155 | |||||||||||||
Taiwan | 489,508 | 729,562 | — | 1,219,070 | |||||||||||||
Thailand | — | 274,183 | — | 274,183 | |||||||||||||
Turkey | 29,644 | 67,261 | — | 96,905 | |||||||||||||
United States | 76,969 | — | — | 76,969 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Brazil | 58,105 | — | — | 58,105 | |||||||||||||
Short-Term Investments | 181,640 | — | — | 181,640 | |||||||||||||
Total | $ | 2,975,438 | $ | 6,983,974 | $ | — | $ | 9,959,412 |
Semi-Annual Report 249
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Emerging Markets Equity Blend Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Argentina | $ | 1,132,662 | $ | — | $ | — | $ | 1,132,662 | |||||||||
Brazil | 6,173,907 | — | — | 6,173,907 | |||||||||||||
Canada | 667,954 | — | — | 667,954 | |||||||||||||
Chile | 196,876 | — | — | 196,876 | |||||||||||||
China | 8,716,943 | 16,619,000 | — | 25,335,943 | |||||||||||||
Colombia | 1,714,536 | — | — | 1,714,536 | |||||||||||||
Egypt | — | 1,133,753 | — | 1,133,753 | |||||||||||||
Estonia | — | 79,744 | — | 79,744 | |||||||||||||
Georgia | — | 569,907 | — | 569,907 | |||||||||||||
Greece | — | 1,051,404 | — | 1,051,404 | |||||||||||||
Hong Kong | — | 1,619,862 | — | 1,619,862 | |||||||||||||
Hungary | — | 989,060 | — | 989,060 | |||||||||||||
India | 2,566,517 | 8,525,029 | — | 11,091,546 | |||||||||||||
Indonesia | 980,417 | 3,579,916 | — | 4,560,333 | |||||||||||||
Kenya | — | 164,974 | — | 164,974 | |||||||||||||
Kuwait | — | 233,211 | — | 233,211 | |||||||||||||
Mexico | 2,970,953 | — | — | 2,970,953 | |||||||||||||
Oman | — | 192,178 | — | 192,178 | |||||||||||||
Pakistan | — | 118,154 | — | 118,154 | |||||||||||||
Philippines | 473,615 | 785,075 | — | 1,258,690 | |||||||||||||
Russia | 5,023,877 | 1,899,614 | — | 6,923,491 | |||||||||||||
Singapore | — | 412,772 | — | 412,772 | |||||||||||||
South Africa | — | 1,067,223 | — | 1,067,223 | |||||||||||||
South Korea | — | 10,993,832 | — | 10,993,832 | |||||||||||||
Taiwan | 799,905 | 6,102,849 | — | 6,902,754 | |||||||||||||
Thailand | — | 423,787 | — | 423,787 | |||||||||||||
Turkey | 878,084 | — | — | 878,084 | |||||||||||||
Ukraine | — | 197,081 | — | 197,081 | |||||||||||||
United Arab Emirates | — | 1,427,534 | — | 1,427,534 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Brazil | 1,450,493 | — | — | 1,450,493 | |||||||||||||
Short-Term Investments | 5,900,475 | — | — | 5,900,475 | |||||||||||||
Total | $ | 39,647,214 | $ | 58,185,959 | $ | — | $ | 97,833,173 |
250 Semi-Annual Report
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Emerging Markets Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Argentina | $ | 157,388,921 | $ | — | $ | — | $ | 157,388,921 | |||||||||
Brazil | 737,455,656 | — | — | 737,455,656 | |||||||||||||
China | 436,454,622 | 1,158,768,322 | — | 1,595,222,944 | |||||||||||||
Egypt | — | 94,352,865 | — | 94,352,865 | |||||||||||||
Hong Kong | — | 83,882,613 | — | 83,882,613 | |||||||||||||
Hungary | — | 136,982,231 | — | 136,982,231 | |||||||||||||
India | 86,405,196 | 808,737,307 | — | 895,142,503 | |||||||||||||
Indonesia | 140,194,396 | 329,270,630 | — | 469,465,026 | |||||||||||||
Luxembourg | 62,644,007 | — | — | 62,644,007 | |||||||||||||
Malaysia | — | 51,814,813 | — | 51,814,813 | |||||||||||||
Mexico | 276,741,167 | — | — | 276,741,167 | |||||||||||||
Pakistan | — | 67,015,364 | — | 67,015,364 | |||||||||||||
Philippines | 67,696,078 | — | — | 67,696,078 | |||||||||||||
Russia | 124,936,876 | 684,615,683 | — | 809,552,559 | |||||||||||||
South Africa | — | 610,356,043 | — | 610,356,043 | |||||||||||||
South Korea | — | 1,182,552,396 | — | 1,182,552,396 | |||||||||||||
Taiwan | — | 388,782,739 | — | 388,782,739 | |||||||||||||
Thailand | — | 153,229,557 | — | 153,229,557 | |||||||||||||
Turkey | — | 182,392,746 | — | 182,392,746 | |||||||||||||
Short-Term Investments | 308,295,968 | — | — | 308,295,968 | |||||||||||||
Total | $ | 2,398,212,887 | $ | 5,932,753,309 | $ | — | $ | 8,330,966,196 | |||||||||
Lazard Equity Franchise Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Belgium | $ | — | $ | 1,726,929 | $ | — | $ | 1,726,929 | |||||||||
France | — | 1,996,081 | — | 1,996,081 | |||||||||||||
Germany | — | 1,109,581 | — | 1,109,581 | |||||||||||||
Italy | — | 2,041,550 | — | 2,041,550 | |||||||||||||
Luxembourg | — | 2,104,093 | — | 2,104,093 | |||||||||||||
Spain | — | 755,486 | — | 755,486 | |||||||||||||
United Kingdom | — | 2,539,774 | — | 2,539,774 | |||||||||||||
United States | 23,713,278 | — | — | 23,713,278 | |||||||||||||
Short-Term Investments | 1,000,857 | — | — | 1,000,857 | |||||||||||||
Total | $ | 24,714,135 | $ | 12,273,494 | $ | — | $ | 36,987,629 |
Semi-Annual Report 251
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Global Equity Select Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Belgium | $ | — | $ | 1,064,197 | $ | — | $ | 1,064,197 | |||||||||
Canada | 3,989,544 | — | — | 3,989,544 | |||||||||||||
China | 519,364 | 837,990 | — | 1,357,354 | |||||||||||||
Finland | — | 1,236,559 | — | 1,236,559 | |||||||||||||
France | — | 792,390 | — | 792,390 | |||||||||||||
Germany | — | 793,377 | — | 793,377 | |||||||||||||
Hong Kong | — | 2,301,967 | — | 2,301,967 | |||||||||||||
India | 382,706 | — | — | 382,706 | |||||||||||||
Israel | — | 880,962 | — | 880,962 | |||||||||||||
Japan | — | 3,707,764 | — | 3,707,764 | |||||||||||||
Netherlands | — | 1,895,123 | — | 1,895,123 | |||||||||||||
Singapore | — | 1,028,323 | — | 1,028,323 | |||||||||||||
South Africa | — | 1,072,882 | — | 1,072,882 | |||||||||||||
South Korea | — | 259,475 | — | 259,475 | |||||||||||||
Sweden | — | 2,190,510 | — | 2,190,510 | |||||||||||||
Switzerland | — | 2,278,414 | — | 2,278,414 | |||||||||||||
Taiwan | 690,019 | — | — | 690,019 | |||||||||||||
United Kingdom | 1,094,631 | 7,682,605 | — | 8,777,236 | |||||||||||||
United States | 33,590,525 | — | — | 33,590,525 | |||||||||||||
Short-Term Investments | 3,690,630 | — | — | 3,690,630 | |||||||||||||
Total | $ | 43,957,419 | $ | 28,022,538 | $ | — | $ | 71,979,957 |
252 Semi-Annual Report
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Global Listed Infrastructure Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 595,817,712 | $ | — | $ | 595,817,712 | |||||||||
Canada | 63,990,916 | — | — | 63,990,916 | |||||||||||||
France | — | 497,928,959 | — | 497,928,959 | |||||||||||||
Germany | — | 206,859,697 | — | 206,859,697 | |||||||||||||
Hong Kong | — | 244,921,164 | — | 244,921,164 | |||||||||||||
Italy | — | 1,561,653,441 | — | 1,561,653,441 | |||||||||||||
Luxembourg | — | 247,735,433 | — | 247,735,433 | |||||||||||||
Portugal | — | 56,661,970 | — | 56,661,970 | |||||||||||||
United Kingdom | — | 1,303,598,447 | — | 1,303,598,447 | |||||||||||||
United States | 1,428,920,016 | — | — | 1,428,920,016 | |||||||||||||
Short-Term Investments | 522,234,791 | — | — | 522,234,791 | |||||||||||||
Total | $ | 2,015,145,723 | $ | 4,715,176,823 | $ | — | $ | 6,730,322,546 | |||||||||
Liabilities: | |||||||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | $ | — | $ | (11,314,148 | ) | $ | — | $ | (11,314,148 | ) | |||||||
Global Strategic Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Belgium | $ | — | $ | 45,168 | $ | — | $ | 45,168 | |||||||||
Canada | 141,943 | — | — | 141,943 | |||||||||||||
China | 40,837 | 40,717 | — | 81,554 | |||||||||||||
Denmark | — | 38,112 | — | 38,112 | |||||||||||||
Finland | — | 46,862 | — | 46,862 | |||||||||||||
France | — | 132,048 | — | 132,048 | |||||||||||||
Germany | — | 51,494 | — | 51,494 | |||||||||||||
Hong Kong | — | 54,053 | — | 54,053 | |||||||||||||
India | 47,628 | — | — | 47,628 | |||||||||||||
Ireland | 17,510 | — | — | 17,510 | |||||||||||||
Israel | — | 46,368 | — | 46,368 | |||||||||||||
Japan | — | 143,340 | — | 143,340 | |||||||||||||
Netherlands | — | 47,232 | — | 47,232 | |||||||||||||
New Zealand | — | 33,153 | — | 33,153 | |||||||||||||
South Africa | — | 73,345 | — | 73,345 | |||||||||||||
Switzerland | — | 160,975 | — | 160,975 | |||||||||||||
United Kingdom | — | 224,811 | — | 224,811 | |||||||||||||
United States | 1,559,742 | — | — | 1,559,742 | |||||||||||||
Short-Term Investments | 136,026 | — | — | 136,026 | |||||||||||||
Total | $ | 1,943,686 | $ | 1,137,678 | $ | — | $ | 3,081,364 |
Semi-Annual Report 253
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Lazard International Quality Growth Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 76,871 | $ | — | $ | 76,871 | |||||||||
Canada | 500,303 | — | — | 500,303 | |||||||||||||
China | 69,305 | 113,101 | — | 182,406 | |||||||||||||
Denmark | — | 153,902 | — | 153,902 | |||||||||||||
France | — | 141,061 | — | 141,061 | |||||||||||||
Germany | — | 183,554 | — | 183,554 | |||||||||||||
India | 159,949 | — | — | 159,949 | |||||||||||||
Israel | 73,759 | — | — | 73,759 | |||||||||||||
Japan | — | 287,332 | — | 287,332 | |||||||||||||
Netherlands | — | 146,558 | — | 146,558 | |||||||||||||
Norway | — | 70,743 | — | 70,743 | |||||||||||||
Philippines | — | 33,706 | — | 33,706 | |||||||||||||
South Africa | — | 161,249 | — | 161,249 | |||||||||||||
Spain | — | 55,524 | — | 55,524 | |||||||||||||
Sweden | — | 220,815 | — | 220,815 | |||||||||||||
Switzerland | — | 296,827 | — | 296,827 | |||||||||||||
Taiwan | 88,877 | — | — | 88,877 | |||||||||||||
United Kingdom | — | 472,460 | — | 472,460 | |||||||||||||
United States | 123,314 | 70,930 | — | 194,244 | |||||||||||||
Short-Term Investments | 136,134 | — | — | 136,134 | |||||||||||||
Total | $ | 1,151,641 | $ | 2,484,633 | $ | — | $ | 3,636,274 |
254 Semi-Annual Report
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Equity Advantage Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 161,869 | $ | — | $ | 161,869 | |||||||||
Austria | — | 2,252 | — | 2,252 | |||||||||||||
Belgium | — | 5,556 | — | 5,556 | |||||||||||||
China | — | 34,185 | — | 34,185 | |||||||||||||
Denmark | — | 55,161 | — | 55,161 | |||||||||||||
Finland | — | 1,635 | — | 1,635 | |||||||||||||
France | — | 256,730 | — | 256,730 | |||||||||||||
Germany | — | 217,383 | — | 217,383 | |||||||||||||
Hong Kong | — | 95,884 | — | 95,884 | |||||||||||||
Ireland | — | 4,675 | — | 4,675 | |||||||||||||
Israel | 2,173 | 4,281 | — | 6,454 | |||||||||||||
Italy | — | 76,476 | — | 76,476 | |||||||||||||
Japan | 31,899 | 514,783 | — | 546,682 | |||||||||||||
Luxembourg | — | 2,328 | — | 2,328 | |||||||||||||
Macau | — | 2,696 | — | 2,696 | |||||||||||||
Netherlands | — | 141,127 | — | 141,127 | |||||||||||||
Norway | — | 56,277 | — | 56,277 | |||||||||||||
Singapore | — | 5,759 | — | 5,759 | |||||||||||||
Spain | — | 70,640 | — | 70,640 | |||||||||||||
Sweden | — | 48,572 | — | 48,572 | |||||||||||||
Switzerland | — | 234,758 | — | 234,758 | |||||||||||||
United Kingdom | — | 313,917 | — | 313,917 | |||||||||||||
Short-Term Investments | 61,584 | — | — | 61,584 | |||||||||||||
Total | $ | 95,656 | $ | 2,306,944 | $ | — | $ | 2,402,600 | |||||||||
International Equity Concentrated Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | 2,271,112 | $ | — | $ | — | $ | 2,271,112 | |||||||||
Belgium | — | 3,650,294 | — | 3,650,294 | |||||||||||||
Canada | 9,227,519 | — | — | 9,227,519 | |||||||||||||
China | — | 7,247,425 | — | 7,247,425 | |||||||||||||
France | — | 13,992,118 | — | 13,992,118 | |||||||||||||
Germany | — | 6,441,381 | — | 6,441,381 | |||||||||||||
Japan | — | 9,984,903 | — | 9,984,903 | |||||||||||||
Mexico | 4,681,199 | — | — | 4,681,199 | |||||||||||||
Netherlands | — | 2,249,320 | — | 2,249,320 | |||||||||||||
South Korea | — | 3,098,752 | — | 3,098,752 | |||||||||||||
United Kingdom | — | 9,173,524 | — | 9,173,524 | |||||||||||||
United States | 8,025,599 | — | — | 8,025,599 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Germany | — | 3,067,492 | — | 3,067,492 | |||||||||||||
Short-Term Investments | 3,832,671 | — | — | 3,832,671 | |||||||||||||
Total | $ | 28,038,100 | $ | 58,905,209 | $ | — | $ | 86,943,309 |
Semi-Annual Report 255
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | 34,279,063 | $ | 42,057,849 | $ | — | $ | 76,336,912 | |||||||||
Belgium | — | 76,136,306 | — | 76,136,306 | |||||||||||||
Canada | 152,991,907 | — | — | 152,991,907 | |||||||||||||
China | — | 48,498,012 | — | 48,498,012 | |||||||||||||
Denmark | — | 44,574,594 | — | 44,574,594 | |||||||||||||
Finland | — | 71,065,222 | — | 71,065,222 | |||||||||||||
France | — | 372,659,375 | — | 372,659,375 | |||||||||||||
Germany | — | 143,326,096 | — | 143,326,096 | |||||||||||||
India | 32,249,663 | — | — | 32,249,663 | |||||||||||||
Ireland | 30,937,223 | — | — | 30,937,223 | |||||||||||||
Israel | — | 33,711,602 | — | 33,711,602 | |||||||||||||
Japan | — | 368,083,825 | — | 368,083,825 | |||||||||||||
Netherlands | — | 212,346,156 | — | 212,346,156 | |||||||||||||
Norway | — | 67,222,737 | — | 67,222,737 | |||||||||||||
Singapore | — | 76,549,038 | — | 76,549,038 | |||||||||||||
South Korea | — | 35,095,375 | — | 35,095,375 | |||||||||||||
Spain | — | 41,097,428 | — | 41,097,428 | |||||||||||||
Sweden | — | 101,441,028 | — | 101,441,028 | |||||||||||||
Switzerland | — | 137,370,485 | — | 137,370,485 | |||||||||||||
United Arab Emirates | — | 14,798,852 | — | 14,798,852 | |||||||||||||
United Kingdom | — | 388,593,611 | — | 388,593,611 | |||||||||||||
United States | 165,720,908 | 28,409,225 | — | 194,130,133 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Germany | — | 50,322,906 | — | 50,322,906 | |||||||||||||
Short-Term Investments | 102,933,421 | — | — | 102,933,421 | |||||||||||||
Total | $ | 519,112,185 | $ | 2,353,359,722 | $ | — | $ | 2,872,471,907 |
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Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Equity Select Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 1,207,675 | $ | — | $ | 1,207,675 | |||||||||
Belgium | — | 2,058,073 | — | 2,058,073 | |||||||||||||
Brazil | 1,793,041 | — | — | 1,793,041 | |||||||||||||
Canada | 4,313,340 | — | — | 4,313,340 | |||||||||||||
China | 797,330 | 3,016,529 | — | 3,813,859 | |||||||||||||
Denmark | — | 1,920,906 | — | 1,920,906 | |||||||||||||
Finland | — | 2,683,821 | — | 2,683,821 | |||||||||||||
France | — | 10,736,782 | — | 10,736,782 | |||||||||||||
Germany | — | 3,237,346 | — | 3,237,346 | |||||||||||||
India | 2,133,564 | — | — | 2,133,564 | |||||||||||||
Indonesia | 852,580 | — | — | 852,580 | |||||||||||||
Ireland | 859,284 | — | — | 859,284 | |||||||||||||
Japan | — | 7,422,873 | — | 7,422,873 | |||||||||||||
Mexico | 869,123 | — | — | 869,123 | |||||||||||||
Netherlands | — | 6,667,354 | — | 6,667,354 | |||||||||||||
Norway | — | 2,447,837 | — | 2,447,837 | |||||||||||||
Russia | 946,200 | — | — | 946,200 | |||||||||||||
Singapore | — | 1,733,453 | — | 1,733,453 | |||||||||||||
South Africa | — | 3,011,998 | — | 3,011,998 | |||||||||||||
South Korea | — | 1,101,904 | — | 1,101,904 | |||||||||||||
Spain | — | 993,313 | — | 993,313 | |||||||||||||
Sweden | — | 2,190,528 | — | 2,190,528 | |||||||||||||
Switzerland | — | 5,481,085 | — | 5,481,085 | |||||||||||||
Taiwan | — | 1,114,841 | — | 1,114,841 | |||||||||||||
Thailand | — | 663,026 | — | 663,026 | |||||||||||||
United Kingdom | — | 7,714,550 | — | 7,714,550 | |||||||||||||
United States | 7,181,699 | 755,414 | — | 7,937,113 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Germany | — | 1,621,884 | — | 1,621,884 | |||||||||||||
Short-Term Investments | 3,822,174 | — | — | 3,822,174 | |||||||||||||
Total | $ | 23,568,335 | $ | 67,781,192 | $ | — | $ | 91,349,527 |
Semi-Annual Report 257
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Equity Value Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Austria | $ | — | $ | 470,817 | $ | — | $ | 470,817 | |||||||||
Canada | 337,998 | — | — | 337,998 | |||||||||||||
France | — | 4,691,374 | — | 4,691,374 | |||||||||||||
Germany | — | 875,368 | — | 875,368 | |||||||||||||
India | 1,089,035 | — | — | 1,089,035 | |||||||||||||
Ireland | 527,936 | — | — | 527,936 | |||||||||||||
Italy | — | 1,016,703 | — | 1,016,703 | |||||||||||||
Japan | 523,900 | 2,783,948 | — | 3,307,848 | |||||||||||||
Mexico | 755,322 | — | — | 755,322 | |||||||||||||
Netherlands | — | 1,988,474 | — | 1,988,474 | |||||||||||||
South Korea | — | 990,201 | — | 990,201 | |||||||||||||
Spain | — | 808,816 | — | 808,816 | |||||||||||||
Switzerland | — | 1,013,196 | — | 1,013,196 | |||||||||||||
United Kingdom | — | 4,159,162 | — | 4,159,162 | |||||||||||||
United States | 912,725 | — | — | 912,725 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Germany | — | 876,667 | — | 876,667 | |||||||||||||
Short-Term Investments | 1,152,313 | — | — | 1,152,313 | |||||||||||||
Total | $ | 5,299,229 | $ | 19,674,726 | $ | — | $ | 24,973,955 |
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Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Small Cap Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 2,009,748 | $ | — | $ | 2,009,748 | |||||||||
Belgium | — | 2,798,984 | — | 2,798,984 | |||||||||||||
Brazil | 406,307 | — | — | 406,307 | |||||||||||||
Canada | 3,234,807 | — | — | 3,234,807 | |||||||||||||
China | — | 905,437 | — | 905,437 | |||||||||||||
Denmark | — | 728,328 | — | 728,328 | |||||||||||||
Finland | — | 673,399 | — | 673,399 | |||||||||||||
France | — | 1,265,296 | — | 1,265,296 | |||||||||||||
Germany | — | 5,803,304 | — | 5,803,304 | |||||||||||||
Greece | — | 469,072 | — | 469,072 | |||||||||||||
Hong Kong | — | 518,032 | — | 518,032 | |||||||||||||
India | — | 762,225 | — | 762,225 | |||||||||||||
Ireland | — | 1,923,159 | — | 1,923,159 | |||||||||||||
Italy | — | 2,009,307 | — | 2,009,307 | |||||||||||||
Japan | — | 13,912,711 | — | 13,912,711 | |||||||||||||
Jersey | — | 839,973 | — | 839,973 | |||||||||||||
Luxembourg | — | 451,271 | — | 451,271 | |||||||||||||
Netherlands | — | 1,262,050 | — | 1,262,050 | |||||||||||||
New Zealand | — | 1,172,372 | — | 1,172,372 | |||||||||||||
Singapore | — | 450,247 | — | 450,247 | |||||||||||||
Sweden | — | 4,923,752 | — | 4,923,752 | |||||||||||||
Switzerland | — | 762,227 | — | 762,227 | |||||||||||||
Thailand | — | 250,300 | — | 250,300 | |||||||||||||
United Kingdom | — | 8,394,283 | — | 8,394,283 | |||||||||||||
Short-Term Investments | 125,396 | — | — | 125,396 | |||||||||||||
Total | $ | 3,766,510 | $ | 52,285,477 | $ | — | $ | 56,051,987 |
Semi-Annual Report 259
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
International Strategic Equity Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Canada | $ | 567,578,184 | $ | — | $ | — | $ | 567,578,184 | |||||||||
China | 52,131,970 | 133,032,320 | — | 185,164,290 | |||||||||||||
Denmark | — | 195,413,627 | — | 195,413,627 | |||||||||||||
Finland | — | 175,569,569 | — | 175,569,569 | |||||||||||||
France | — | 681,096,599 | — | 681,096,599 | |||||||||||||
Germany | — | 109,182,253 | — | 109,182,253 | |||||||||||||
Hong Kong | — | 142,078,482 | — | 142,078,482 | |||||||||||||
India | 47,133,548 | 76,477,463 | — | 123,611,011 | |||||||||||||
Ireland | 64,463,009 | — | — | 64,463,009 | |||||||||||||
Israel | — | 85,469,906 | — | 85,469,906 | |||||||||||||
Japan | — | 862,377,956 | — | 862,377,956 | |||||||||||||
Mexico | 27,516,617 | — | — | 27,516,617 | |||||||||||||
Netherlands | — | 232,065,003 | — | 232,065,003 | |||||||||||||
Norway | — | 94,628,480 | — | 94,628,480 | |||||||||||||
Philippines | — | 44,563,165 | — | 44,563,165 | |||||||||||||
Singapore | — | 133,387,045 | — | 133,387,045 | |||||||||||||
Sweden | — | 210,722,062 | — | 210,722,062 | |||||||||||||
Switzerland | — | 463,060,432 | — | 463,060,432 | |||||||||||||
United Kingdom | — | 1,037,998,606 | — | 1,037,998,606 | |||||||||||||
United States | 531,942,902 | — | — | 531,942,902 | |||||||||||||
Preferred Stocks* | |||||||||||||||||
Germany | — | 152,384,833 | — | 152,384,833 | |||||||||||||
Short-Term Investments | 222,496,138 | — | — | 222,496,138 | |||||||||||||
Total | $ | 1,513,262,368 | $ | 4,829,507,801 | $ | — | $ | 6,342,770,169 |
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Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||
Managed Equity Volatility Portfolio | |||||||||||||||||
Common Stocks* | |||||||||||||||||
Australia | $ | — | $ | 1,415,777 | $ | — | $ | 1,415,777 | |||||||||
Belgium | — | 373,980 | — | 373,980 | |||||||||||||
Canada | 1,712,867 | — | — | 1,712,867 | |||||||||||||
China | — | 69,162 | — | 69,162 | |||||||||||||
Denmark | — | 351,387 | — | 351,387 | |||||||||||||
France | — | 294,400 | — | 294,400 | |||||||||||||
Germany | — | 354,876 | — | 354,876 | |||||||||||||
Hong Kong | — | 350,469 | — | 350,469 | |||||||||||||
Israel | — | 354,569 | — | 354,569 | |||||||||||||
Italy | — | 770,024 | — | 770,024 | |||||||||||||
Japan | — | 1,596,063 | — | 1,596,063 | |||||||||||||
Netherlands | — | 245,153 | — | 245,153 | |||||||||||||
Norway | — | 481,063 | — | 481,063 | |||||||||||||
Puerto Rico | 93,783 | — | — | 93,783 | |||||||||||||
Singapore | — | 268,536 | — | 268,536 | |||||||||||||
Spain | — | 157,265 | — | 157,265 | |||||||||||||
Sweden | — | 85,840 | — | 85,840 | |||||||||||||
Switzerland | — | 1,003,096 | — | 1,003,096 | |||||||||||||
United Kingdom | — | 980,152 | — | 980,152 | |||||||||||||
United States | 13,806,269 | — | — | 13,806,269 | |||||||||||||
Short-Term Investments | 778,116 | — | — | 778,116 | |||||||||||||
Total | $ | 16,391,035 | $ | 9,151,812 | $ | — | $ | 25,542,847 | |||||||||
US Equity Concentrated Portfolio | |||||||||||||||||
Common Stocks* | $ | 1,210,539,759 | $ | — | $ | — | $ | 1,210,539,759 | |||||||||
Short-Term Investments | 76,788,553 | — | — | 76,788,553 | |||||||||||||
Total | $ | 1,287,328,312 | $ | — | $ | — | $ | 1,287,328,312 | |||||||||
US Equity Select Portfolio | |||||||||||||||||
Common Stocks* | $ | 76,611,315 | $ | — | $ | — | $ | 76,611,315 | |||||||||
Short-Term Investments | 2,293,013 | — | — | 2,293,013 | |||||||||||||
Total | $ | 78,904,328 | $ | — | $ | — | $ | 78,904,328 | |||||||||
US Realty Equity Portfolio | |||||||||||||||||
Common Stocks* | $ | 1,482,422 | $ | — | $ | — | $ | 1,482,422 | |||||||||
Real Estate Investment Trusts* | 63,144,604 | — | — | 63,144,604 | |||||||||||||
Short-Term Investments | 947,672 | — | — | 947,672 | |||||||||||||
Total | $ | 65,574,698 | $ | — | $ | — | $ | 65,574,698 | |||||||||
US Small-Mid Cap Equity Portfolio | |||||||||||||||||
Common Stocks* | $ | 82,339,363 | $ | — | $ | — | $ | 82,339,363 |
Semi-Annual Report 261
10. Derivative Instruments
The Global Listed Infrastructure Portfolio may use derivative instruments, including forward currency contracts.
Forward currency contracts may be used for hedging purposes or to seek to increase returns.
During the period ended June 30, 2019, the approximate average monthly notional exposure for derivative instruments was as follows:
Forward currency contracts: | ||||
Average amounts purchased | $ | 93,700,000 | ||
Average amounts sold | $ | 4,594,500,000 |
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Liabilities – Derivative Financial Instruments | Total | |
Forward currency contracts | Unrealized depreciation on forward currency contracts | $11,314,148 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Total |
Forward currency contracts | $97,690,745 |
Net Change in Unrealized Appreciation (Depreciation) on: | Total |
Forward currency contracts | $(12,249,877) |
None of the other Portfolios presented traded in derivative instruments during the period ended June 30, 2019.
As of June 30, 2019, the Global Listed Infrastructure Portfolio held derivative instruments that are eligible for offset in the Statement of Assets and Liabilities and are subject to master netting arrangements. A master netting arrangement is an agreement between two counterparties who have multiple contracts with each other that provides for the net settlement of all contracts, as well as any cash collateral, through a single payment in the event of default on, or termination of, any one contract.
262 Semi-Annual Report
The required information for the affected Portfolio is presented in the below table, as of June 30, 2019:
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||
Forward Currency Contracts | $11,314,148 | $ — | $11,314,148 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
BNP Paribas SA | $ | 2,197,121 | $ | — | $ | — | $ | 2,197,121 | ||||||||||
Canadian Imperial Bank of Commerce | 266,258 | — | — | 266,258 | ||||||||||||||
Citibank NA | 1,365,099 | — | — | 1,365,099 | ||||||||||||||
HSBC Bank USA NA | 1,939,628 | — | — | 1,939,628 | ||||||||||||||
Royal Bank of Canada | 1,773,377 | — | — | 1,773,377 | ||||||||||||||
Standard Chartered Bank | 1,838,494 | — | — | 1,838,494 | ||||||||||||||
State Street Bank and Trust Co. | 1,669,549 | — | — | 1,669,549 | ||||||||||||||
The Bank of New York Mellon Corp. | 264,622 | — | — | 264,622 | ||||||||||||||
Total | $ | 11,314,148 | $ | — | $ | — | $ | 11,314,148 |
11. Accounting Pronouncements
In August 2018, the Financial Accounting Standards Board issued an Accounting Standards Update (“ASU”), ASU 2018-13,Fair Value Measurement (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurementwhich removes, modifies and adds disclosures to Topic 820. The amendments in this ASU apply to all entities that are required, under existing GAAP, to make disclosures about recurring or nonrecurring fair value measurements. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. Management has evaluated the impact of the amendments and has elected to adopt these amendments and incorporate the changes in the current financial statements.
Semi-Annual Report 263
12. Subsequent Events
Directors of the Fund approved the name change of Lazard International Compounders Portfolio to Lazard International Quality Growth Portfolio, which became effective on July 31, 2019. Management has evaluated subsequent events affecting the Portfolios through the issuance of the financial statements and has determined that, aside from items previously disclosed, there were no subsequent events that required adjustment or disclosure.
264 Semi-Annual Report
Board of Directors and Officers Information (unaudited)
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Independent Directors(3): | ||||
Franci J. Blassberg (1953) | Director (August 2014) | Debevoise & Plimpton LLP, a law firm,Of Counsel(2013 – present) | ||
Cornell Law School,Adjunct Professor(2013 – 2016, 2019) | ||||
The Buchmann Faculty of Law, Tel Aviv University,Visiting Professor(2019) | ||||
University of California, Berkeley School of Law,Adjunct Professor(Spring 2017) | ||||
Kenneth S. Davidson (1945) | Director (August 1995) | Davidson Capital Management Corporation, an investment manager,President(1978 – present) | ||
Landseer Advisors LLC, an investment manager,Senior Advisor(2012 – 2014) | ||||
Nancy A. Eckl (1962) | Director (April 2007) | College Retirement Equities Fund (eight accounts),Trustee (2007 – present) | ||
TIAA-CREF Funds (69 funds) and TIAA-CREF Life Funds (11 funds),Trustee(2007 – present) | ||||
TIAA Separate Account VA-1,Member of the Management Committee(2007 – present) | ||||
Trevor W. Morrison (1971) | Director (April 2014) | New York University School of Law,DeanandEric M. and Laurie B. Roth Professor of Law (2013 – present) | ||
Columbia Law School,Professor of Law(2008 – 2013) | ||||
Richard Reiss, Jr. (1944) | Director (May 1991) | Georgica Advisors LLC, an investment manager,Chairman(1997 – present) | ||
Resource America, Inc., a real estate asset management company,Director(2016 – 2018) |
Semi-Annual Report 265
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Robert M. Solmson (1947) | Director (September 2004) | Fairwood Capital, LLC, a private investment corporation engaged primarily in real estate and hotel investments,Co-Managing Partner and Managing Director (2008 – present) | ||
Interested Directors(4): | ||||
Ashish Bhutani (1960) | Director (July 2005) | Investment Manager,Chief Executive Officer(2004 – present) | ||
Lazard Ltd,Vice Chairman and Director(2010 – present) | ||||
Nathan A. Paul (1973) | Director (October 2017), Chief Executive Officer and President | Investment Manager,Chief Business Officer (April 2017 – present) andManaging Director (2003 – present) | ||
(February 2017; previously, Vice President and Secretary since April 2002) | Investment Manager,General Counsel(2002 – April 2017) |
(1) | The address of each Director of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each Director serves as a Director for each of the funds in the Lazard Fund Complex (comprised of, as of July 31, 2019, 39 active investment portfolios). Each Director serves an indefinite term, until his or her successor is elected, and each Director serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | “Independent Directors” are not “interested persons” (as defined in the 1940 Act) of the Fund. |
(4) | Messrs. Bhutani and Paul are “interested persons” (as defined in the 1940 Act) of the Fund because of their positions with the Investment Manager. |
The Fund’s Statement of Additional Information contains further information about the Directors and is available without charge by calling 800-823-6300, or online, at www.lazardassetmanagement.com.
266 Semi-Annual Report
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) During the Past Five Years | ||
Officers(3): | ||||
Mark R. Anderson (1970) | Chief Compliance Officer (September 2014), Vice President and Secretary (February 2017) | Managing Director (since February 2017, previously Director), Chief Compliance Officer (since September 2014) and General Counsel (since April 2017) of the Investment Manager | ||
Senior Vice President, Counsel and Deputy Chief Compliance Officer of AllianceBernstein L.P. (2004 – August 2014) | ||||
Christopher Snively (1984) | Chief Financial Officer (March 2016) | Senior Vice President of the Investment Manager (since November 2015) | ||
Assurance Manager at PricewaterhouseCoopers LLP (2008 – November 2015) | ||||
Stephen St. Clair (1958) | Treasurer (May 2003) | Vice President of the Investment Manager | ||
Shari L. Soloway (1981) | Assistant Secretary (November 2015) | Head of Legal, North America (since January 2019, previously Senior Vice President, Legal and Compliance (since September 2015)) of the Investment Manager | ||
Vice President and Associate General Counsel of GE Asset Management (July 2011 – September 2015) | ||||
Jessica A. Falzone (1989) | Assistant Secretary (January 2019) | Vice President, Legal and Compliance, of the Investment Manager (since March 2018) | ||
Associate at Schulte Roth & Zabel LLP (2014 – March 2018) | ||||
Cesar A. Trelles (1975) | Assistant Treasurer (December 2004) | Vice President of the Investment Manager |
(1) | The address of each officer of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each officer serves for an indefinite term, until his or her successor is elected and qualifies or until his or her earlier resignation or removal. Each officer serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | In addition to Nathan A. Paul, Chief Executive Officer and President (since February 2017; previously, Vice President and Secretary since April 2002), whose information is included in the Interested Directors section above. |
Semi-Annual Report 267
The Lazard Funds, Inc.Other Information (unaudited)
Proxy Voting
A description of the policies and procedures used to determine how proxies relating to Fund portfolio securities are voted is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov.
The Fund’s proxy voting record for the most recent 12-month period ended June 30 is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov. Information as of June 30 each year will generally be available by the following August 31.
Schedule of Portfolio Holdings
The Fund files its complete schedule of each Portfolio’s holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT reports are available on the SEC’s website at https://www.sec.gov.
Board Consideration of Management Agreement
All Portfolios except Lazard International Equity Value Portfolio and Lazard International Quality Growth Portfolio.
At meetings of the Board held on May 22, 2019 and June 5, 2019, the Board considered the approval, for an additional annual period, of the Management Agreement between the Fund, on behalf of the Portfolios, and the Investment Manager. The Independent Directors were assisted in their review by independent legal counsel, who advised the Board on relevant legal standards and met with the Independent Directors in executive sessions separate from representatives of the Investment Manager.
Representatives of the Investment Manager discussed with the Board the Investment Manager’s written materials provided in advance of the meetings, including, at the June 5, 2019 meeting, additional information requested by the Independent Directors at the May 22, 2019 meeting.
268 Semi-Annual Report
Services Provided
The Investment Manager’s materials addressed, among other matters, the nature, extent and quality of services that the Investment Manager provides the Fund, including a discussion of the Investment Manager and its clients (of which the Lazard Funds complex of 39 active funds comprised approximately $29 billion of the approximately $235 billion of total assets under the management of the Investment Manager and its global affiliates as of March 31, 2019).
The Board considered the various services provided by the Investment Manager including the Investment Manager’s research, portfolio management and trading capabilities and oversight of day-to-day operations, including supervision of fund accounting and administration-related services and assistance in meeting legal and regulatory requirements, as well as regular reporting to, and support of, the Board. The Investment Manager’s representatives stated that the Investment Manager believes that the Fund and its shareholders continue to be able to obtain significant benefits as a result of the resources and support of the Investment Manager’s global research, portfolio management, trading, operations, risk management, technology and legal and compliance infrastructure. The Board also considered information provided by the Investment Manager regarding its personnel, resources, financial condition and experience; the Fund’s distribution channels and the relationships with various intermediaries; marketing and shareholder servicing activities on behalf of the Portfolios; and Portfolio asset flows and the growth or decline in asset levels. The Board accepted the assertion of representatives of the Investment Manager that the Fund benefits from the services and infrastructure provided by the Investment Manager and that such services and infrastructure are greater than those typically provided to a $29 billion fund complex not managed by a large, global firm such as the Investment Manager.
Comparative Fee, Expense Ratio and Performance Information
The Board reviewed information prepared by Strategic Insight, an independent provider of investment company data, comparing, for the fiscal year ended December 31, 2018, each Portfolio’s:
Semi-Annual Report 269
• | contractual management fee (i.e., without giving effect to any fee waivers), referred to in the Strategic Insight materials as “advisor fee,” expense ratio (net of any fee waivers or expense reimbursements) and performance (for one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to those of a group of comparison funds selected by Strategic Insight (a “Group”); |
• | advisor fee and expense ratio to a broader group of funds based on the Portfolio’s Morningstar category (an “Expense Universe”); and |
• | performance (for the one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to that of the funds in the Portfolio’s Morningstar category (a “Category”) and the benchmark index and the Portfolio’s performance for each of the four most recently completed calendar years, as applicable, and the first quarter of 2019, to that of the funds in the Portfolio’s Category and the benchmark index. |
The Strategic Insight materials outlined the process of construction of the Groups, Expense Universes and Categories, and representatives of the Investment Manager and independent legal counsel had previously discussed with the Board in further detail the methodologies used by Strategic Insight in constructing the Groups, Expense Universes and Categories, including how the methodologies could affect the results of the comparisons.
Advisor Fees and Expense Ratios. Representatives of the Investment Manager discussed the results of the Strategic Insight advisor fee and expense ratio comparisons with the Board, which showed that the advisor fees and expense ratios of the Portfolios were competitive within each Portfolio’s respective Group. The Board considered the comparisons, additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager and that the Investment Manager continues to voluntarily enter into expense limitation agreements for all of the Portfolios, pursuant to which the Investment Manager currently was waiving advisor fees and/or reimbursing expenses for certain Portfolios.
270 Semi-Annual Report
As applicable, the Board also considered fees paid to the Investment Manager by any funds advised or sub-advised by the Investment Manager utilizing the same investment strategies as the Portfolios, as well as any separately managed accounts of the Investment Manager with similar investment objectives, policies and strategies (for each Portfolio, collectively with such funds, “Similar Accounts”). Representatives of the Investment Manager discussed the nature of the Similar Accounts and the significant differences in services provided by the Investment Manager to the different types of Similar Accounts as compared to the services provided to the Portfolios. The Board considered the relevance of the fee information provided for Similar Accounts, in light of the Investment Manager’s discussion of the significant differences in services provided, to evaluate the fees paid to the Investment Manager by the Portfolios.
Performance.When evaluating the performance of each Portfolio, the Board considered Strategic Insight’s performance analysis along with other information provided by the Investment Manager, including additional performance information, as well as additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager. The Board also received and would continue to receive regular updates and/or additional information (as requested by the Board) from the Investment Manager in respect of Portfolios with relative underperformance compared to the relevant Group, as well as any other Portfolios for which the Board requested additional information.
Investment Manager Profitability and Economies of Scale
The Board reviewed information prepared by the Investment Manager for each Portfolio concerning the estimated profitability percentage of the Management Agreement to the Investment Manager and its affiliates for the calendar year ended December 31, 2018 and the Investment Manager’s cost allocation methodology to compute an estimate of each Portfolio’s costs to the Investment Manager. The Investment Manager’s representatives reviewed with the Board information provided on the Investment Manager’s brokerage practices and the Portfolios’ brokerage allocation, commission payments and soft dollar commissions and
Semi-Annual Report 271
benefits. The Investment Manager’s representatives stated that neither the Investment Manager nor its affiliates receive any other significant indirect benefits from the Investment Manager acting as investment manager to the Portfolios. The representatives of the Investment Manager reminded the Board that the Investment Manager is continuing to support distribution relationships through direct payments from its or its affiliates’ own resources to third parties in connection with distribution and shareholder servicing and/or administrative and recordkeeping services, and noted that the Fund does not bear any related costs other than the 0.25% 12b-1 fee pursuant to the Distribution and Servicing Plan adopted for the Portfolios’ Open Shares.
The profitability percentages were within ranges determined by relevant court cases not to be so disproportionately large that they bore no reasonable relationship to the services rendered. The Board (1) considered the Investment Manager’s estimated profitability with respect to each Portfolio as part of their evaluation of the Portfolio’s fee under the Management Agreement, considered in relation to the mix of services provided by the Investment Manager (including the nature, extent and quality of such services), and (2) evaluated the profitability in light of the relevant circumstances for each Portfolio. Representatives of the Investment Manager and the Board discussed ways economies of scale could be realized and how they could be shared, including the Investment Manager’s reinvestment of profits back into its business, waiving or reducing Portfolio management fees and/or reimbursing expenses, adding discounts to a Portfolio’s management fee schedule as a Portfolio’s assets increase or by instituting management fees at inception that account for future scale. It was noted that each Portfolio had declining or generally stable assets over the past calendar year, or a relatively low asset level at which economies of scale would not ordinarily be expected to be realized, so that the potential that the Investment Manager may have realized any economies of scale was reduced.
At the conclusion of these discussions, the Board expressed the opinion that it had been furnished with such information as may reasonably be necessary to make an informed business decision with respect to evaluation of the renewal of the Management
272 Semi-Annual Report
Agreement. Based on its discussions and considerations as described above, with the assistance of independent legal counsel and in the exercise of its business judgment, the Board made the following conclusions and determinations.
• | The Board concluded that the nature, extent and quality of the services provided by the Investment Manager are adequate and appropriate, noting the benefits of the significant services and infrastructure associated with an approximately $235 billion global asset management business. |
• | The Board concluded that each Portfolio’s fee paid to the Investment Manager was appropriate under the circumstances and in light of the factors and the totality of the services provided. |
• | The Board, after considering the information provided and the totality of the relevant circumstances for each Portfolio, concluded that the investment performance of each Portfolio was acceptable or that, for any Portfolios that were not performing in accordance with expectations, the Board accepted that the Investment Manager was taking steps intended to improve performance and the Board would continue to monitor performance. |
• | The Board recognized that economies of scale may be realized, particularly as the assets of the Portfolios increase and determined that they would continue to consider potential material economies of scale. |
In evaluating the Management Agreement, the Board relied on the information described above, in addition to information provided by the Investment Manager throughout the year relating to the operations of the Fund and the investment management and other services provided under the Management Agreement, including information on the investment performance of the Portfolios in comparison to similar mutual funds and benchmark performance indices over various time periods; general market outlook as applicable to the Portfolios; and compliance reports. The Board also relied on its previous knowledge, gained through meetings and other interactions with the Investment Manager, of the Investment Manager and the services provided to the Fund by the
Semi-Annual Report 273
Investment Manager. The Board considered these conclusions and determinations in their totality and determined to approve the Fund’s Management Agreement for each Portfolio. In deciding whether to vote to approve the Management Agreement for each Portfolio, each Director may have accorded different weights to different factors so that each Director may have had a different basis for his or her decision.
274 Semi-Annual Report
The Lazard Funds, Inc.
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
https://www.lazardassetmanagement.com
Investment Manager
Lazard Asset Management LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
Distributor
Lazard Asset Management Securities LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Custodian
State Street Bank and Trust Company
One Iron Street
Boston, Massachusetts 02210
Transfer Agent and Dividend Disbursing Agent
DST Asset Manager Solutions, Inc.
2000 Crown Colony Drive
Quincy, Massachusetts 02169
Telephone: 617-483-7000
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
30 Rockefeller Plaza
New York, New York 10112-0015
Legal Counsel
Proskauer Rose LLP
Eleven Times Square
New York, New York 10036-8299
http://www.proskauer.com
Lazard Asset Management LLC • 30 Rockefeller Plaza • New York, NY 10112 • www.lazardassetmanagement.com | ||
Performance information as of the most recent month end is available online at www.lazardassetmanagement.com. LZDPS020 | We Recycle This document is printed on recycled paper. |
Lazard Funds
Semi-Annual Report
June 30, 2019
Fixed Income Funds
Lazard Emerging Markets Debt Portfolio
Lazard Global Fixed Income Portfolio
Lazard US Corporate Income Portfolio
Lazard US Short Duration Fixed Income Portfolio
Important Information on Paperless Delivery
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports like this one will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. Shareholders who hold accounts directly with the Fund may elect to receive shareholder reports and other communications from the Fund electronically by signing up for paperless delivery at www.icsdelivery.com/lazardassetmanagement. If you own these shares through a financial intermediary, you may contact your financial intermediary.
You may elect to receive all future reports in paper free of charge. You can inform the Fund that you wish to continue receiving paper copies of your shareholder reports by following the instructions included with this disclosure and visiting www.fundreports.com. If you own these shares through a financial intermediary, you may contact your financial intermediary or follow instructions included with this disclosure to elect to continue to receive paper copies of your shareholder reports. Your election to receive reports in paper will apply to all funds held with the fund complex or your financial intermediary.
PRIVACY NOTICE
WHAT DOES LAZARD DO WITH YOUR PERSONAL INFORMATION?
Financial companies choose how they share your personal information. U.S. federal law gives our clients the right to limit some but not all sharing. U.S. federal and other applicable law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
We do not disclose nonpublic personal information about our clients or former clients to third parties other than as described below.
Personal information we collect.We collect personal information about you in connection with our providing advisory services to you. The legal basis for our collection of your personal information is our contract with you and our legitimate business interest to provide contractual services to you. The collection of this information is necessary for us to be able to provide advisory services to you and the failure to provide such information will result in our inability to provide our services. This information includes your social security number (for U.S. persons) and may include other information such as your:
● | Assets and income; | |
● | Investment experience; | |
● | Transaction history; | |
● | Credit history; and | |
● | Wire transfer instructions. |
How we collect this information.We collect this information from you through various means. For example, when you give us your contact information, enter into an investment advisory contract with us, buy securities (i.e., interests in a fund) from us, direct us to buy or sell securities for your account, tell us where to send money, or make a wire transfer. We also may collect your personal information from other sources, such as our affiliates1 or other non-affiliated companies (such as credit bureaus).
1 | Our affiliates are companiesrelated to us by common ownership or control and can include both financial and nonfinancial companies. Non-affiliates are companiesnot related to us by common ownership or control and can include both financial and nonfinancial companies. |
How we use this information.All financial companies need to share customers’ personal information to run their everyday business and we use the personal information we collect from you for our everyday business purposes. These purposes may include for example:
● | To provide advisory services to you; | |
● | To open an account for you; | |
● | To process a transaction for your account; | |
● | To market products and services to you; and/or | |
● | To respond to court orders and legal investigations. |
If you are an investor located within a European Union country, please note that personal information may be collected, shared and/or stored outside of the European Union.
Disclosure to others.We may provide your personal information to our affiliates and to firms that assist us in servicing your account and have a need for such information, such as a broker, counterparty, fund administrator or third party service provider that aggregates data in a central repository for access by a broker, counterparty or fund administrator to provide its services. We may also disclose such information to service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you. We require third party service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you to protect the confidentiality of your information and to use the information only for the purposes for which we disclose the information to them. These sharing practices are consistent with applicable privacy and related laws, and in general, you may not limit our use of your personal information for these purposes under such laws. We note that the U.S. federal privacy laws only give you the right to limit the certain types of information sharing that we do not engage in (e.g., sharing with our affiliates certain information relating to your transaction history or creditworthiness for their use in marketing to you, or sharing any personal information with non-affiliates for them to market to you). We may also share your personal information with non-affiliates (such as a government agency or regulatory authority) as required by applicable law.
How we protect your personal information.To protect your personal information from unauthorized access and use, we use security measures that comply with applicable law. These measures include computer safeguards and secured files and buildings.
How long we keep your personal information.We retain your personal information for the duration of your advisory relationship with us and for a period of time thereafter as required by applicable law.
Your rights with respect to this information.If you are an investor located within a European Union country, you have the following rights with respect to your personal information:
● | The right to request and obtain a copy of your personal information that we maintain; | |
● | The right to correct your personal information that we maintain; | |
● | The right to request the erasure of your personal information from our systems, subject to applicable recordkeeping requirements applicable to us; and | |
● | The right to lodge a complaint with a supervisory authority. |
Who is providing this Privacy Notice.This Privacy Notice relates to the following entities:
● | Lazard Asset Management LLC | |
● | Lazard Asset Management (Canada), Inc.2 | |
● | Lazard Asset Management Securities LLC |
Who to contact with questions.If you have any questions about this Privacy Notice, please call (800) 823-6300 or visit our website at http://www.lazardassetmanagement.com.
2 | Lazard Asset Management (Canada), Inc. does not disclose any non-public personal information about its customers to any third party, except as permitted by or required by any applicable law, including the laws of the United States and Canada. |
The Lazard Funds, Inc.Table of Contents
Please consider a Portfolio’s investment objectives, risks, charges and expenses carefully before investing. For more complete information about The Lazard Funds, Inc. (the “Fund”), you may obtain a prospectus or summary prospectus by calling 800-823-6300, or online, at www.lazardassetmanagement.com. Read the prospectus or each Portfolio’s summary prospectus carefully before you invest. The prospectus and each Portfolio’s summary prospectus contain the investment objectives, risks, charges, expenses and other information about each Portfolio of the Fund, which are not detailed in this report.
Distributed by Lazard Asset Management Securities LLC.
Semi-Annual Report 1
The Lazard Funds, Inc.A Message from Lazard (unaudited)
Dear Shareholder,
Global markets registered strong gains in the first half of 2019. They reached near-record highs in April, thanks to strong corporate earnings and better-than-expected quarterly US GDP growth. However, heightened trade tensions and mixed economic data gave investors pause in May as China and the United States again raised tariffs on each other’s imports after trade talks stalled.
The US equity market rose strongly during the period, boosted by hopes that renewed trade negotiations and a potential interest rate cut by the Federal Reserve in July would keep the United States on strong economic footing. Financials, materials, and technology outperformed, while energy lagged against a backdrop of falling oil prices, concerns about global demand, and rising inventories. Volatility as measured by the CBOE Volatility Index (VIX) rose mildly but remained well below levels at the end of 2018.
European equity markets have been caught in the middle of opposing forces, mainly growing tensions around global trade and increasingly dovish central banks. This has pushed European government bond yields to fresh lows and caused bond-sensitive sectors to climb higher, further stretching valuations.
Emerging markets equities gained more than 10% year to date. The asset class’s performance was volatile over the latter half of the period, reflecting extraordinary uncertainty among investors about the geopolitical environment, particularly US actions on trade in May and early June. Emerging markets debt also delivered strong year-to-date returns, supported by liquidity from central banks. However, the global growth outlook has become more uncertain and current valuations provide less compensation for the increased risks.
In this environment, we believe it is becoming increasingly important for investors to be discerning, to focus on fundamentals and not short-term macro drivers, particularly as sentiment is vulnerable to rapid shifts. We are privileged that you have turned to
2 Semi-Annual Report
Lazard for your investment needs and value your continued confidence in our investment management capabilities.
Sincerely,
Lazard Asset Management LLC
Semi-Annual Report 3
The Lazard Funds, Inc.Performance Overviews (unaudited)
Lazard Emerging Markets Debt Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Emerging Markets Debt Portfolio, JPMorgan EMBI Global Diversified®Index, JPMorgan GBI-EM Global Diversified®Index and Global Diversified Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Years | Inception | † | ||||
Institutional Shares** | 10.12% | 0.87% | 2.84% | ||||
Open Shares** | 9.99% | 0.60% | 2.55% | ||||
R6 Shares** | 10.12% | N/A | 4.07% | ||||
JPMorgan EMBI Global Diversified Index | 12.45% | 5.30% | 6.47% (Institutional and Open Shares) | ||||
5.01% (R6 Shares) | |||||||
JPMorgan GBI-EM Global Diversified Index | 8.99% | –0.45% | 0.96% (Institutional and Open Shares) | ||||
4.49% (R6 Shares) | |||||||
Global Diversified Index | 10.77% | 2.46% | 3.75% (Institutional and Open Shares) | ||||
4.81% (R6 Shares) |
† | The inception date for the Institutional and Open Shares was February 28, 2011 and for the R6 Shares was July 28, 2016. |
4 Semi-Annual Report
Lazard Global Fixed Income Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Global Fixed Income Portfolio and Bloomberg Barclays Global Aggregate®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Years | Inception | † | ||||
Institutional Shares** | 5.99% | 0.54% | 0.88% | ||||
Open Shares** | 5.84% | 0.27% | 0.60% | ||||
Bloomberg Barclays Global Aggregate Index | 5.85% | 1.20% | 1.60% |
† | The inception date for the Portfolio was March 30, 2012. |
Semi-Annual Report 5
Lazard US Corporate Income Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard US Corporate Income Portfolio and Cash Pay Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Ten | Since | ||||||
Year | Years | Years | Inception | † | |||||
Institutional Shares** | 8.12% | 4.00% | 7.22% | 4.38% | |||||
Open Shares** | 7.78% | 3.65% | 6.89% | 3.87% | |||||
R6 Shares** | 7.90% | N/A | N/A | 3.98% | |||||
Cash Pay Index | 8.82% | 4.90% | 8.42% | 6.46% (Institutional Shares) | |||||
6.42% (Open Shares) | |||||||||
6.25% (R6 Shares) |
† | The inception date for the Institutional Shares was January 2, 1998, for the Open Shares wasFebruary 24, 1998 and for the R6 Shares was November 3, 2016. |
6 Semi-Annual Report
Lazard US Short Duration Fixed Income Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard US Short Duration Fixed Income Portfolio and ICE BofAML 1-3 Year US Treasury®Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One | Five | Since | |||||
Year | Years | Inception | † | ||||
Institutional Shares** | 3.01% | 0.97% | 1.29% | ||||
Open Shares** | 2.60% | 0.85% | 1.12% | ||||
ICE BofAML 1-3 Year US Treasury Index | 3.96% | 1.21% | 1.05% |
† | The inception date for the Portfolio was February 28, 2011. |
Notes to Performance Overviews:
* | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by Lazard Asset Management LLC, the Funds’ investment manager (the “Investment Manager”), State Street Bank and Trust Company, the Funds’ administrator (“State Street”) or DST Asset Manager Solutions, Inc., the Funds’ transfer and dividend distributing agent (“DST”); without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. |
Performance results do not include adjustments made for financial reporting purposes in accordance with US Generally Accepted Accounting principles, if any, and also exclude one-time adjustments related to reimbursed custodian out-of-pocket expenses (Note 3 in the Notes to Financial Statements) for Lazard Emerging Markets Debt Portfolio and settlement proceeds received from a class action lawsuit (Lazard US Corporate Income Portfolio R6 Shares), and may differ from amounts reported in the financial highlights. | |
The performance quoted represents past performance. Current performance may be lower or higher than the performance quoted. Past performance is not indicative, or a guarantee, of future results; the investment return and principal value of the Portfolio will fluctuate, so that Portfolio shares, when redeemed, may be worth more or less than their original cost. Within the longer periods illustrated there may have been short-term fluctuations, counter to the overall trend of investment results, and no single period of any length may be taken as typical of what may be expected in future periods. The graph and table above do not reflect the deduction of taxes that a shareholder would pay on the Portfolio’s distributions or the redemption of Portfolio shares. | |
The performance data of the indices have been prepared from sources and data that |
Semi-Annual Report 7
the Investment Manager believes to be reliable, but no representation is made as to their accuracy. The indices are unmanaged, have no fees or costs and are not available for investment. | |
The JPMorgan EMBI Global Diversified Index is a uniquely weighted version of the EMBI Global. Risks associated with the securities comprising this index include fixed income and emerging markets. The JPMorgan GBI-EM Global Diversified Index is a uniquely weighted version of the GBI-EM Global. Risks include fixed income, emerging markets and derivatives. These indices limit the weights of those index countries with larger debt stocks by only including specified portions of these countries’ eligible current face amounts of debt outstanding. The countries covered in both indices are identical. | |
The Global Diversified Index is an unmanaged index created by the Investment Manager and is a 50/50 blend of the JPMorgan EMBI Global Diversified Index and the JPMorgan GBI-EM Global Diversified Index. | |
The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of global investment-grade fixed-income debt markets, including government-related debt, corporate debt, securitized debt and global Treasury. | |
The Cash Pay Index is the ICE BofAML BB-B US Cash Pay Non-Distressed High Yield®Index. It is constructed to mirror the BB-B non-distressed sector of the public high yield corporate debt market and is a subset of the ICE Bank of America Merrill Lynch High Yield Cash Pay®Index. | |
The ICE BofAML 1-3 Year US Treasury Index tracks the performance of the direct sovereign debt of the US Government having a maturity of at least one year and less than three years. | |
** | The performance of Institutional Shares, Open Shares and R6 Shares may vary, primarily based on the differences in fees borne by shareholders investing in different classes. |
8 Semi-Annual Report
Information About Your Portfolio’s Expenses (unaudited)
Expense Example
As a shareholder in a Portfolio of the Fund, you incur ongoing costs, including management fees, distribution and service (12b-1) fees (Open Shares only), and other expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the six month period from January 1, 2019 through June 30, 2019 and held for the entire period.
Actual Expenses
For each Share class of the Portfolios, the first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000=8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
For each Share class of the Portfolios, the second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the class’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other mutual funds.
Semi-Annual Report 9
Expenses | Annualized | |||
Beginning | Ending | Paid During | Expense Ratio | |
Account | Account | Period* | During Period | |
Value | Value | 1/1/19 - | 1/1/19 - | |
Portfolio | 1/1/19 | 6/30/19 | 6/30/19 | 6/30/19 |
Emerging Markets Debt | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,108.40 | $5.07 | 0.97% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,019.98 | $4.86 | 0.97% |
Open Shares | ||||
Actual | $1,000.00 | $1,107.90 | $6.11 | 1.17% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,018.99 | $5.86 | 1.17% |
R6 Shares | ||||
Actual | $1,000.00 | $1,108.40 | $4.81 | 0.92% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.23 | $4.61 | 0.92% |
Global Fixed Income | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,058.00 | $3.57 | 0.70% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.32 | $3.51 | 0.70% |
Open Shares | ||||
Actual | $1,000.00 | $1,057.90 | $4.85 | 0.95% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.08 | $4.76 | 0.95% |
US Corporate Income | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,095.60 | $2.86 | 0.55% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,022.07 | $2.76 | 0.55% |
Open Shares | ||||
Actual | $1,000.00 | $1,091.20 | $4.41 | 0.85% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,020.58 | $4.26 | 0.85% |
R6 Shares | ||||
Actual | $1,000.00 | $1,067.30 | $2.82 | 0.55% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,022.07 | $2.76 | 0.55% |
10 Semi-Annual Report
Expenses | Annualized | |||
Beginning | Ending | Paid During | Expense Ratio | |
Account | Account | Period* | During Period | |
Value | Value | 1/1/19 - | 1/1/19 - | |
Portfolio | 1/1/19 | 6/30/19 | 6/30/19 | 6/30/19 |
US Short Duration Fixed Income | ||||
Institutional Shares | ||||
Actual | $1,000.00 | $1,019.00 | $2.00 | 0.40% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,022.81 | $2.01 | 0.40% |
Open Shares | ||||
Actual | $1,000.00 | $1,016.40 | $3.50 | 0.70% |
Hypothetical (5% Return Before Expenses) | $1,000.00 | $1,021.32 | $3.51 | 0.70% |
* | Expenses are equal to the annualized expense ratio, net of expenses waivers and reimbursements, of each Share class multiplied by the average account value over the period, multiplied by 181/365 (to reflect one-half year period). |
Semi-Annual Report 11
The Lazard Funds, Inc.Portfolio Holdings Presented by
Credit Rating June 30, 2019 (unaudited)
Lazard | Lazard US | Lazard US | |||||||||||
Global Fixed | Corporate | Short Duration | |||||||||||
Income | Income | Fixed Income | |||||||||||
Asset Class/S&P Credit Rating* | Portfolio | Portfolio | Portfolio | ||||||||||
AAA | 19.2 | % | — | % | 5.6 | % | |||||||
AA+ | 11.9 | — | 56.5 | ||||||||||
AA- | 5.0 | — | — | ||||||||||
A+ | 10.2 | — | — | ||||||||||
A | 4.1 | — | — | ||||||||||
A- | 5.1 | — | 13.3 | ||||||||||
BBB+ | 9.1 | — | 17.5 | ||||||||||
BBB | 4.8 | 1.2 | 4.6 | ||||||||||
BBB- | 7.2 | 7.7 | — | ||||||||||
BB+ | 3.2 | 13.9 | — | ||||||||||
BB | 0.4 | 24.0 | — | ||||||||||
BB- | — | 26.7 | — | ||||||||||
B+ | 0.5 | 10.3 | — | ||||||||||
B | — | 6.1 | — | ||||||||||
B- | — | 3.3 | — | ||||||||||
CCC+ | — | 1.1 | — | ||||||||||
CCC | — | 0.6 | — | ||||||||||
Not Applicable | 17.8 | — | — | ||||||||||
No Rating | 1.1 | 4.3 | 1.9 | ||||||||||
Short-Term Investments | 0.4 | 0.8 | 0.6 | ||||||||||
Total Investments | 100.0 | % | 100.0 | % | 100.0 | % | |||||||
Lazard | |||||||||||||
Emerging | |||||||||||||
Markets Debt | |||||||||||||
Asset Class/Region* | Portfolio | ||||||||||||
Africa | 10.7 | % | |||||||||||
Asia | 25.7 | ||||||||||||
Europe | 23.6 | ||||||||||||
North America | 12.0 | ||||||||||||
South America | 25.6 | ||||||||||||
Short-Term Investments | 2.4 | ||||||||||||
Total Investments | 100.0 | % |
* | Represents percentage of total investments. |
12 Semi-Annual Report
The Lazard Funds, Inc.Portfolios of Investments
June 30, 2019 (unaudited)
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 13
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Kazakhstan | 0.5% | ||||||||||
Development Bank of Kazakhstan JSC, 4.125%, 12/10/22 | USD | 415 | $ | 421,225 | ||||||
KazMunayGas National Co. JSC, 5.750%, 04/19/47 | USD | 410 | 462,275 | |||||||
883,500 | ||||||||||
Nigeria | 0.1% | ||||||||||
IHS Netherlands Holdco BV, 9.500%, 10/27/21 | USD | 200 | 207,516 | |||||||
Panama | 0.1% | ||||||||||
Sable International Finance, Ltd., 6.875%, 08/01/22 (#) | USD | 200 | 207,000 | |||||||
Peru | 0.5% | ||||||||||
Fondo MIVIVIENDA SA, 7.000%, 02/14/24 | PEN | 960 | 313,138 | |||||||
Hunt Oil Co. of Peru LLC Sucursal Del Peru, 6.375%, 06/01/28 (#) | USD | 450 | 499,500 | |||||||
812,638 | ||||||||||
Zambia | 0.2% | ||||||||||
First Quantum Minerals, Ltd., 7.250%, 05/15/22 (#) | USD | 400 | 396,500 | |||||||
Total Corporate Bonds (Cost $6,991,782) | 7,249,122 | |||||||||
Foreign Government Obligations | 90.0% | ||||||||||
Angola | 0.5% | ||||||||||
Republic of Angola: | ||||||||||
9.500%, 11/12/25 | USD | 302 | 345,790 | |||||||
8.250%, 05/09/28 (#) | USD | 230 | 246,100 | |||||||
9.375%, 05/08/48 | USD | 200 | 220,375 | |||||||
812,265 |
The accompanying notes are an integral part of these financial statements.
14 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Argentina | 1.5% | ||||||||||
Provincia de Buenos Aires, 7.875%, 06/15/27 | USD | 225 | $ | 166,360 | ||||||
Republic of Argentina: | ||||||||||
5.625%, 01/26/22 | USD | 650 | 547,625 | |||||||
4.625%, 01/11/23 | USD | 237 | 189,970 | |||||||
15.500%, 10/17/26 | ARS | 7,540 | 121,838 | |||||||
6.875%, 01/26/27 | USD | 960 | 764,400 | |||||||
6.625%, 07/06/28 | USD | 435 | 335,222 | |||||||
7.125%, 07/06/36 | USD | 225 | 172,406 | |||||||
6.875%, 01/11/48 | USD | 185 | 137,131 | |||||||
7.125%, 06/28/2117 | USD | 320 | 240,700 | |||||||
2,675,652 | ||||||||||
Azerbaijan | 0.5% | ||||||||||
Republic of Azerbaijan, 4.750%, 03/18/24 | USD | 835 | 878,420 | |||||||
Bahrain | 0.2% | ||||||||||
Kingdom of Bahrain, 6.125%, 07/05/22 | USD | 370 | 390,350 | |||||||
Belarus | 0.3% | ||||||||||
Republic of Belarus, 7.625%, 06/29/27 | USD | 425 | 484,500 | |||||||
Belize | 0.1% | ||||||||||
Republic of Belize, 4.938%, 02/20/34 (Ø) | USD | 185 | 112,214 | |||||||
Brazil | 5.1% | ||||||||||
Brazil Letras do Tesouro Nacional, 0.000%, 07/01/23 | BRL | 10,630 | 2,125,134 | |||||||
Brazil NTN-B, 6.000%, 08/15/50 | BRL | 330 | 390,486 | |||||||
Brazil NTN-F: | ||||||||||
10.000%, 01/01/25 | BRL | 10,450 | 3,073,850 | |||||||
10.000%, 01/01/27 | BRL | 2,175 | 650,482 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 15
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Federal Republic of Brazil: | ||||||||||
6.000%, 04/07/26 | USD | 440 | $ | 507,320 | ||||||
4.625%, 01/13/28 | USD | 1,401 | 1,471,050 | |||||||
5.625%, 02/21/47 | USD | 565 | 603,138 | |||||||
8,821,460 | ||||||||||
Chile | 1.8% | ||||||||||
Bonos de la Tesoreria de la Republica en pesos: | ||||||||||
4.700%, 09/01/30 (#) | CLP | 165,000 | 274,093 | |||||||
6.000%, 01/01/43 | CLP | 585,000 | 1,189,813 | |||||||
5.100%, 07/15/50 | CLP | 400,000 | 728,290 | |||||||
Republic of Chile: | ||||||||||
3.240%, 02/06/28 | USD | 800 | 838,750 | |||||||
3.500%, 01/25/50 | USD | 120 | 122,160 | |||||||
3,153,106 | ||||||||||
Colombia | 4.4% | ||||||||||
Colombian Titulos De Tesoreria: | ||||||||||
6.250%, 11/26/25 | COP | 4,065,000 | 1,311,160 | |||||||
7.500%, 08/26/26 | COP | 5,460,000 | 1,879,610 | |||||||
6.000%, 04/28/28 | COP | 4,147,000 | 1,292,777 | |||||||
7.000%, 06/30/32 | COP | 3,499,000 | 1,150,358 | |||||||
Republic of Colombia: | ||||||||||
4.500%, 01/28/26 | USD | 350 | 378,175 | |||||||
4.500%, 03/15/29 | USD | 390 | 426,806 | |||||||
7.375%, 09/18/37 | USD | 105 | 142,866 | |||||||
5.000%, 06/15/45 | USD | 1,055 | 1,167,358 | |||||||
7,749,110 | ||||||||||
Costa Rica | 1.2% | ||||||||||
Republic of Costa Rica: | ||||||||||
5.520%, 08/23/23 | USD | 1,140 | 1,056,612 | |||||||
5.625%, 04/30/43 | USD | 425 | 368,023 | |||||||
7.000%, 04/04/44 | USD | 205 | 203,719 | |||||||
7.158%, 03/12/45 | USD | 495 | 498,249 | |||||||
2,126,603 |
The accompanying notes are an integral part of these financial statements.
16 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Czech Republic | 1.3% | ||||||||||
Czech Republic: | ||||||||||
3.750%, 09/12/20 | CZK | 8,260 | $ | 379,177 | ||||||
2.500%, 08/25/28 | CZK | 13,060 | 635,010 | |||||||
4.200%, 12/04/36 | CZK | 21,940 | 1,308,844 | |||||||
2,323,031 | ||||||||||
Dominican Republic | 1.5% | ||||||||||
Dominican Republic: | ||||||||||
8.900%, 02/15/23 | DOP | 25,900 | 506,147 | |||||||
6.875%, 01/29/26 | USD | 730 | 823,987 | |||||||
5.950%, 01/25/27 | USD | 475 | 510,625 | |||||||
6.000%, 07/19/28 (#) | USD | 550 | 593,141 | |||||||
6.850%, 01/27/45 | USD | 60 | 65,625 | |||||||
6.500%, 02/15/48 (#) | USD | 75 | 79,266 | |||||||
2,578,791 | ||||||||||
Ecuador | 1.3% | ||||||||||
Republic of Ecuador: | ||||||||||
10.750%, 03/28/22 (#) | USD | 325 | 364,813 | |||||||
7.950%, 06/20/24 | USD | 565 | 591,308 | |||||||
9.650%, 12/13/26 | USD | 815 | 884,020 | |||||||
8.875%, 10/23/27 (#) | USD | 460 | 479,550 | |||||||
2,319,691 | ||||||||||
Egypt | 1.7% | ||||||||||
Arab Republic of Egypt: | ||||||||||
5.577%, 02/21/23 (#) | USD | 270 | 274,388 | |||||||
6.200%, 03/01/24 (#) | USD | 740 | 768,675 | |||||||
5.875%, 06/11/25 | USD | 255 | 259,781 | |||||||
7.600%, 03/01/29 | USD | 405 | 427,275 | |||||||
7.600%, 03/01/29 (#) | USD | 115 | 121,325 | |||||||
8.500%, 01/31/47 (#) | USD | 615 | 651,131 | |||||||
7.903%, 02/21/48 (#) | USD | 200 | 202,000 | |||||||
8.700%, 03/01/49 (#) | USD | 270 | 289,575 | |||||||
2,994,150 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 17
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
El Salvador | 0.5% | ||||||||||
Republic of El Salvador: | ||||||||||
7.750%, 01/24/23 | USD | 75 | $ | 80,531 | ||||||
5.875%, 01/30/25 | USD | 181 | 181,226 | |||||||
6.375%, 01/18/27 | USD | 180 | 180,169 | |||||||
8.625%, 02/28/29 | USD | 150 | 171,000 | |||||||
7.650%, 06/15/35 | USD | 65 | 67,600 | |||||||
7.625%, 02/01/41 | USD | 150 | 158,438 | |||||||
838,964 | ||||||||||
Gabon | 0.2% | ||||||||||
Gabonese Republic, 6.375%, 12/12/24 | USD | 420 | 414,225 | |||||||
Ghana | 0.6% | ||||||||||
Republic of Ghana: | ||||||||||
7.875%, 08/07/23 | USD | 130 | 140,887 | |||||||
8.125%, 03/26/32 (#) | USD | 630 | 641,222 | |||||||
8.627%, 06/16/49 | USD | 255 | 257,152 | |||||||
1,039,261 | ||||||||||
Guatemala | 0.3% | ||||||||||
Guatemala Government Bonds, 4.900%, 06/01/30 (#) | USD | 420 | 430,631 | |||||||
Honduras | 0.2% | ||||||||||
Honduras Government Bonds, 7.500%, 03/15/24 | USD | 245 | 270,113 | |||||||
Republic of Honduras, 6.250%, 01/19/27 | USD | 105 | 113,006 | |||||||
383,119 | ||||||||||
Hungary | 5.2% | ||||||||||
Hungary: | ||||||||||
6.375%, 03/29/21 | USD | 938 | 1,001,006 | |||||||
5.375%, 02/21/23 | USD | 810 | 893,784 | |||||||
5.750%, 11/22/23 | USD | 1,150 | 1,304,531 | |||||||
5.375%, 03/25/24 | USD | 1,096 | 1,237,795 | |||||||
7.625%, 03/29/41 | USD | 768 | 1,230,720 |
The accompanying notes are an integral part of these financial statements.
18 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Hungary Government Bonds: | ||||||||||
1.500%, 08/24/22 | HUF | 758,000 | $ | 2,714,682 | ||||||
2.500%, 10/24/24 | HUF | 196,180 | 721,897 | |||||||
9,104,415 | ||||||||||
Indonesia | 8.1% | ||||||||||
Indonesia Government Bonds: | ||||||||||
7.000%, 05/15/22 | IDR | 4,821,000 | 342,710 | |||||||
5.625%, 05/15/23 | IDR | 5,962,000 | 404,891 | |||||||
8.375%, 03/15/24 | IDR | 7,060,000 | 528,969 | |||||||
8.125%, 05/15/24 | IDR | 20,599,000 | 1,533,169 | |||||||
8.375%, 09/15/26 | IDR | 15,272,000 | 1,148,575 | |||||||
7.000%, 05/15/27 | IDR | 2,543,000 | 177,124 | |||||||
9.000%, 03/15/29 | IDR | 5,083,000 | 396,224 | |||||||
8.250%, 05/15/29 | IDR | 12,943,000 | 971,824 | |||||||
8.750%, 05/15/31 | IDR | 16,071,000 | 1,235,684 | |||||||
7.500%, 08/15/32 | IDR | 26,327,000 | 1,819,270 | |||||||
8.375%, 03/15/34 | IDR | 16,579,000 | 1,243,938 | |||||||
8.250%, 05/15/36 | IDR | 12,883,000 | 952,945 | |||||||
Republic of Indonesia: | ||||||||||
4.750%, 01/08/26 | USD | 445 | 484,633 | |||||||
3.500%, 01/11/28 | USD | 305 | 306,906 | |||||||
4.100%, 04/24/28 | USD | 595 | 628,469 | |||||||
4.750%, 02/11/29 | USD | 600 | 666,000 | |||||||
5.125%, 01/15/45 | USD | 610 | 686,441 | |||||||
5.250%, 01/08/47 | USD | 360 | 415,913 | |||||||
4.350%, 01/11/48 | USD | 215 | 222,592 | |||||||
14,166,277 | ||||||||||
Iraq | 0.6% | ||||||||||
Republic of Iraq: | ||||||||||
6.752%, 03/09/23 | USD | 575 | 590,812 | |||||||
6.752%, 03/09/23 (#) | USD | 125 | 128,438 | |||||||
5.800%, 01/15/28 | USD | 305 | 300,234 | |||||||
1,019,484 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 19
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Ivory Coast | 0.4% | ||||||||||
Ivory Coast: | ||||||||||
5.750%, 12/31/32 (Ø) | USD | 126 | $ | 122,139 | ||||||
6.125%, 06/15/33 | USD | 525 | 488,578 | |||||||
610,717 | ||||||||||
Jamaica | 0.2% | ||||||||||
Government of Jamaica: | ||||||||||
6.750%, 04/28/28 | USD | 185 | 210,206 | |||||||
8.000%, 03/15/39 | USD | 170 | 209,525 | |||||||
419,731 | ||||||||||
Kazakhstan | 0.8% | ||||||||||
Republic of Kazakhstan: | ||||||||||
5.125%, 07/21/25 | USD | 765 | 864,450 | |||||||
4.875%, 10/14/44 | USD | 395 | 454,250 | |||||||
1,318,700 | ||||||||||
Kenya | 0.3% | ||||||||||
Republic of Kenya: | ||||||||||
6.875%, 06/24/24 | USD | 365 | 388,269 | |||||||
8.250%, 02/28/48 (#) | USD | 170 | 177,331 | |||||||
565,600 | ||||||||||
Malaysia | 2.1% | ||||||||||
Malaysia Government Bonds: | ||||||||||
3.882%, 03/10/22 | MYR | 3,340 | 819,736 | |||||||
3.418%, 08/15/22 | MYR | 2,440 | 590,783 | |||||||
3.795%, 09/30/22 | MYR | 1,660 | 406,490 | |||||||
3.955%, 09/15/25 | MYR | 1,390 | 343,416 | |||||||
3.844%, 04/15/33 | MYR | 2,860 | 683,661 | |||||||
4.642%, 11/07/33 | MYR | 2,150 | 560,699 | |||||||
4.893%, 06/08/38 | MYR | 720 | 192,135 | |||||||
Malaysia Sovereign Sukuk Berhad, 4.236%, 04/22/45 | USD | 50 | 57,688 | |||||||
Malaysia Sukuk Global Berhad, 3.179%, 04/27/26 | USD | 50 | 51,250 | |||||||
3,705,858 |
The accompanying notes are an integral part of these financial statements.
20 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Mexico | 6.3% | ||||||||||
Mexican Bonos: | ||||||||||
8.000%, 12/07/23 | MXN | 12,480 | $ | 665,357 | ||||||
10.000%, 12/05/24 | MXN | 106,047 | 6,171,421 | |||||||
8.500%, 05/31/29 | MXN | 14,680 | 813,675 | |||||||
7.750%, 05/29/31 | MXN | 18,020 | 947,940 | |||||||
7.750%, 11/13/42 | MXN | 34,580 | 1,780,342 | |||||||
United Mexican States, 5.750%, 10/12/2110 | USD | 590 | 644,575 | |||||||
11,023,310 | ||||||||||
Mongolia | 0.3% | ||||||||||
Mongolia International Bonds: | ||||||||||
10.875%, 04/06/21 | USD | 45 | 50,063 | |||||||
5.125%, 12/05/22 | USD | 285 | 287,939 | |||||||
8.750%, 03/09/24 (#) | USD | 220 | 249,150 | |||||||
587,152 | ||||||||||
Morocco | 0.3% | ||||||||||
Kingdom of Morocco: | ||||||||||
4.250%, 12/11/22 | USD | 235 | 245,575 | |||||||
5.500%, 12/11/42 | USD | 240 | 273,000 | |||||||
518,575 | ||||||||||
Mozambique | 1.3% | ||||||||||
Mozambique International Bonds, 10.500%, 01/18/23 | USD | 2,268 | 2,283,592 | |||||||
Namibia | 0.1% | ||||||||||
Republic of Namibia, 5.250%, 10/29/25 | USD | 95 | 95,653 | |||||||
Nigeria | 1.0% | ||||||||||
Republic of Nigeria: | ||||||||||
6.375%, 07/12/23 | USD | 465 | 492,609 | |||||||
6.500%, 11/28/27 (#) | USD | 375 | 375,469 | |||||||
7.625%, 11/28/47 | USD | 200 | 199,500 | |||||||
7.625%, 11/28/47 (#) | USD | 695 | 693,263 | |||||||
1,760,841 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 21
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Pakistan | 0.5% | ||||||||||
Islamic Republic of Pakistan: | ||||||||||
8.250%, 04/15/24 | USD | 405 | $ | 442,589 | ||||||
8.250%, 09/30/25 | USD | 200 | 218,812 | |||||||
6.875%, 12/05/27 | USD | 200 | 202,188 | |||||||
863,589 | ||||||||||
Panama | 1.6% | ||||||||||
Republic of Panama: | ||||||||||
3.750%, 03/16/25 | USD | 830 | 875,391 | |||||||
7.125%, 01/29/26 | USD | 210 | 261,975 | |||||||
8.875%, 09/30/27 | USD | 40 | 56,662 | |||||||
3.875%, 03/17/28 | USD | 455 | 486,566 | |||||||
9.375%, 04/01/29 | USD | 140 | 210,087 | |||||||
4.500%, 04/16/50 | USD | 860 | 965,081 | |||||||
2,855,762 | ||||||||||
Paraguay | 1.3% | ||||||||||
Republic of Paraguay: | ||||||||||
5.000%, 04/15/26 | USD | 350 | 382,375 | |||||||
6.100%, 08/11/44 | USD | 310 | 369,481 | |||||||
5.600%, 03/13/48 | USD | 600 | 679,313 | |||||||
5.600%, 03/13/48 (#) | USD | 340 | 384,944 | |||||||
5.400%, 03/30/50 (#) | USD | 435 | 484,753 | |||||||
2,300,866 | ||||||||||
Peru | 6.2% | ||||||||||
Banco de Credito del Peru, | ||||||||||
4.850%, 10/30/20 (#) | PEN | 2,300 | 703,034 | |||||||
Republic of Peru: | ||||||||||
7.350%, 07/21/25 | USD | 445 | 567,514 | |||||||
8.200%, 08/12/26 | PEN | 13,390 | 5,037,845 | |||||||
4.125%, 08/25/27 | USD | 635 | 708,620 | |||||||
6.350%, 08/12/28 | PEN | 3,560 | 1,212,844 | |||||||
2.844%, 06/20/30 | USD | 340 | 342,210 | |||||||
6.900%, 08/12/37 | PEN | 4,230 | 1,499,166 | |||||||
5.625%, 11/18/50 | USD | 590 | 814,200 | |||||||
10,885,433 |
The accompanying notes are an integral part of these financial statements.
22 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
Philippines | 3.5% | ||||||||||
Republic of Philippines: | ||||||||||
4.200%, 01/21/24 | USD | 345 | $ | 371,846 | ||||||
3.625%, 09/09/25 | PHP | 15,300 | 274,383 | |||||||
5.500%, 03/30/26 | USD | 120 | 141,525 | |||||||
3.000%, 02/01/28 | USD | 705 | 723,506 | |||||||
3.750%, 01/14/29 | USD | 2,625 | 2,861,250 | |||||||
7.750%, 01/14/31 | USD | 365 | 536,892 | |||||||
6.375%, 10/23/34 | USD | 380 | 529,625 | |||||||
3.700%, 03/01/41 | USD | 555 | 603,042 | |||||||
6,042,069 | ||||||||||
Poland | 2.1% | ||||||||||
Poland Government Bonds, 3.250%, 07/25/25 | PLN | 12,760 | 3,631,815 | |||||||
Qatar | 2.6% | ||||||||||
State of Qatar: | ||||||||||
4.500%, 04/23/28 | USD | 547 | 611,273 | |||||||
4.000%, 03/14/29 | USD | 835 | 901,278 | |||||||
4.000%, 03/14/29 (#) | USD | 1,140 | 1,230,487 | |||||||
5.103%, 04/23/48 | USD | 665 | 792,389 | |||||||
4.817%, 03/14/49 | USD | 575 | 658,375 | |||||||
4.817%, 03/14/49 (#) | USD | 295 | 337,775 | |||||||
4,531,577 | ||||||||||
Romania | 1.8% | ||||||||||
Romanian Government Bonds: | ||||||||||
4.250%, 06/28/23 | RON | 7,375 | 1,782,469 | |||||||
4.850%, 04/22/26 | RON | 5,580 | 1,374,971 | |||||||
3,157,440 | ||||||||||
Russia | 5.0% | ||||||||||
Russia Foreign Bonds, 5.250%, 06/23/47 | USD | 1,400 | 1,548,750 | |||||||
Russia Government Bonds - OFZ: | ||||||||||
7.400%, 07/17/24 | RUB | 172,820 | 2,752,357 | |||||||
7.950%, 10/07/26 | RUB | 145,380 | 2,382,842 | |||||||
7.050%, 01/19/28 | RUB | 49,670 | 775,672 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 23
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||
6.900%, 05/23/29 | RUB | 17,730 | $ | 272,827 | ||||||
8.500%, 09/17/31 | RUB | 29,610 | 511,206 | |||||||
Russian Foreign Bonds - Eurobond, 5.100%, 03/28/35 | USD | 400 | 434,400 | |||||||
8,678,054 | ||||||||||
Saudi Arabia | 0.5% | ||||||||||
Saudi Government International Bonds, 4.375%, 04/16/29 (#) | USD | 825 | 893,062 | |||||||
Senegal | 0.3% | ||||||||||
Republic of Senegal: | ||||||||||
6.250%, 05/23/33 | USD | 360 | 348,750 | |||||||
6.750%, 03/13/48 | USD | 200 | 188,312 | |||||||
537,062 | ||||||||||
South Africa | 4.3% | ||||||||||
Republic of South Africa: | ||||||||||
7.750%, 02/28/23 | ZAR | 580 | 41,836 | |||||||
10.500%, 12/21/26 | ZAR | 10,670 | 858,248 | |||||||
8.000%, 01/31/30 | ZAR | 12,780 | 856,760 | |||||||
8.250%, 03/31/32 | ZAR | 26,830 | 1,772,956 | |||||||
8.500%, 01/31/37 | ZAR | 55,380 | 3,584,378 | |||||||
8.750%, 02/28/48 | ZAR | 5,050 | �� | 326,248 | ||||||
7,440,426 | ||||||||||
Sri Lanka | 1.1% | ||||||||||
Republic of Sri Lanka: | ||||||||||
5.750%, 01/18/22 | USD | 200 | 200,687 | |||||||
5.875%, 07/25/22 | USD | 200 | 200,188 | |||||||
6.125%, 06/03/25 | USD | 560 | 545,300 | |||||||
6.850%, 11/03/25 | USD | 150 | 150,375 | |||||||
6.825%, 07/18/26 | USD | 130 | 129,513 | |||||||
6.750%, 04/18/28 (#) | USD | 770 | 745,937 | |||||||
1,972,000 | ||||||||||
Suriname | 0.1% | ||||||||||
Republic of Suriname, 9.250%, 10/26/26 | USD | 150 | 139,500 |
The accompanying notes are an integral part of these financial statements.
24 Semi-Annual Report
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||||
Tajikistan | 0.1% | ||||||||||||
Tajikistan International Bonds, 7.125%, 09/14/27 (#) | USD | 190 | $ | 179,550 | ||||||||
Thailand | 2.6% | ||||||||||||
Thailand Government Bonds: | ||||||||||||
3.625%, 06/16/23 | THB | 4,210 | 146,591 | |||||||||
3.850%, 12/12/25 | THB | 5,643 | 204,733 | |||||||||
3.650%, 06/20/31 | THB | 36,620 | 1,365,436 | |||||||||
3.775%, 06/25/32 | THB | 37,370 | 1,412,543 | |||||||||
3.400%, 06/17/36 | THB | 15,930 | 589,258 | |||||||||
3.300%, 06/17/38 | THB | 21,260 | 776,278 | |||||||||
4,494,839 | ||||||||||||
Turkey | 2.8% | ||||||||||||
Republic of Turkey: | ||||||||||||
6.250%, 09/26/22 | USD | 360 | 363,150 | |||||||||
7.250%, 12/23/23 | USD | 355 | 366,981 | |||||||||
5.750%, 03/22/24 | USD | 180 | 175,556 | |||||||||
6.000%, 03/25/27 | USD | 185 | 176,155 | |||||||||
6.000%, 01/14/41 | USD | 190 | 164,113 | |||||||||
6.625%, 02/17/45 | USD | 325 | 299,203 | |||||||||
5.750%, 05/11/47 | USD | 320 | 269,200 | |||||||||
Turkey Government Bonds: | ||||||||||||
10.700%, 02/17/21 | TRY | 3,785 | 579,467 | |||||||||
11.000%, 03/02/22 | TRY | 4,740 | 702,671 | |||||||||
8.800%, 09/27/23 | TRY | 3,850 | 502,385 | |||||||||
10.400%, 03/20/24 | TRY | 4,260 | 581,561 | |||||||||
8.000%, 03/12/25 | TRY | 6,350 | 748,994 | |||||||||
4,929,436 | ||||||||||||
Ukraine | 1.8% | ||||||||||||
Ukraine Government Bonds: | ||||||||||||
7.750%, 09/01/20 | USD | 485 | 501,066 | |||||||||
7.750%, 09/01/21 | USD | 145 | 151,598 | |||||||||
7.750%, 09/01/22 | USD | 275 | 290,812 | |||||||||
7.750%, 09/01/23 | USD | 235 | 248,630 | |||||||||
7.750%, 09/01/25 | USD | 406 | 420,616 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 25
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||||
7.750%, 09/01/26 | USD | 105 | $ | 108,360 | ||||||||
9.750%, 11/01/28 | USD | 690 | 779,269 | |||||||||
7.375%, 09/25/32 | USD | 230 | 226,262 | |||||||||
7.375%, 09/25/32 (#) | USD | 430 | 423,012 | |||||||||
3,149,625 | ||||||||||||
United Arab Emirates | 0.2% | ||||||||||||
Emirate of Dubai Government International Bonds, 5.250%, 01/30/43 | USD | 310 | 336,253 | |||||||||
Venezuela | 1.2% | ||||||||||||
Republic of Venezuela: | ||||||||||||
7.750%, 10/13/19 («) | USD | 245 | 49,000 | |||||||||
6.000%, 12/09/20 («) | USD | 121 | 24,200 | |||||||||
12.750%, 08/23/22 («) | USD | 1,064 | 212,800 | |||||||||
9.000%, 05/07/23 («) | USD | 1,212 | 242,400 | |||||||||
8.250%, 10/13/24 («) | USD | 2,218 | 443,600 | |||||||||
7.650%, 04/21/25 («) | USD | 1,732 | 346,400 | |||||||||
9.250%, 09/15/27 («) | USD | 1,012 | 202,400 | |||||||||
9.250%, 05/07/28 («) | USD | 886 | 177,200 | |||||||||
11.950%, 08/05/31 («) | USD | 805 | 161,000 | |||||||||
9.375%, 01/13/34 («) | USD | 580 | 116,000 | |||||||||
7.000%, 03/31/38 («) | USD | 899 | 179,800 | |||||||||
2,154,800 | ||||||||||||
Zambia | 0.2% | ||||||||||||
Republic of Zambia, 8.500%, 04/14/24 | USD | 505 | 337,087 | |||||||||
Total Foreign Government Obligations (Cost $152,942,453) | 157,215,693 |
The accompanying notes are an integral part of these financial statements.
26 Semi-Annual Report
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||||
Quasi Government Bonds | 1.2% | ||||||||||||
Ecuador | 0.0% | ||||||||||||
EP Petroecuador, 7.963% (USD LIBOR 3 Month + 5.630%), 09/24/19 (§) | USD | 30 | $ | 30,342 | ||||||||
Mexico | 0.2% | ||||||||||||
Petroleos Mexicanos, 6.500%, 03/13/27 | USD | 410 | 405,777 | |||||||||
South Africa | 0.3% | ||||||||||||
Eskom Holdings SOC, Ltd., 5.750%, 01/26/21 | USD | 597 | 602,970 | |||||||||
Tunisia | 0.1% | ||||||||||||
Banque Centrale de Tunisie SA, 5.750%, 01/30/25 | USD | 160 | 148,600 | |||||||||
Turkey | 0.2% | ||||||||||||
Export Credit Bank of Turkey, 5.375%, 02/08/21 | USD | 305 | 298,519 | |||||||||
Ukraine | 0.2% | ||||||||||||
Ukreximbank Via Biz Finance PLC, 9.750%, 01/22/25 | USD | 250 | 261,070 | |||||||||
Venezuela | 0.2% | ||||||||||||
Petroleos de Venezuela SA: | ||||||||||||
8.500%, 10/27/20 | USD | 135 | 100,875 | |||||||||
9.000%, 11/17/21 («) | USD | 251 | 37,650 | |||||||||
12.750%, 02/17/22 («) | USD | 273 | 40,950 | |||||||||
6.000%, 05/16/24 («) | USD | 346 | 51,900 | |||||||||
6.000%, 11/15/26 («) | USD | 414 | 62,100 | |||||||||
5.375%, 04/12/27 («) | USD | 292 | 43,800 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 27
Principal | ||||||||||||
Security | Amount | Fair | ||||||||||
Description | Currency | (000) | Value | |||||||||
Lazard Emerging Markets Debt Portfolio (continued) | ||||||||||||
9.750%, 05/17/35 («) | USD | 295 | $ | 44,250 | ||||||||
5.500%, 04/12/37 («) | USD | 100 | 15,000 | |||||||||
396,525 | ||||||||||||
Total Quasi Government Bonds (Cost $2,740,417) | 2,143,803 | |||||||||||
Supranational Bonds | 1.3% | ||||||||||||
European Bank for Reconstruction & Development: | ||||||||||||
27.500%, 11/23/20 | TRY | 9,310 | 1,716,590 | |||||||||
7.500%, 05/15/22 | IDR | 1,223,000 | 88,130 | |||||||||
International Bank for Reconstruction & Development, 7.450%, 08/20/21 | IDR | 5,610,000 | 403,015 | |||||||||
International Finance Corp., 8.000%, 10/09/23 | IDR | 200,000 | 14,885 | |||||||||
Total Supranational Bonds (Cost $2,017,021) | 2,222,620 | |||||||||||
Fair | ||||||||||||
Description | Shares | Value | ||||||||||
Short-Term Investments | 2.3% | ||||||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $4,103,690) | 4,103,690 | $ | 4,103,690 | |||||||||
Total Investments | 99.0% (Cost $168,795,363) (») | $ | 172,934,928 | ||||||||||
Cash and Other Assets in Excess of Liabilities | 1.0% | 1,765,408 | |||||||||||
Net Assets | 100.0% | $ | 174,700,336 |
The accompanying notes are an integral part of these financial statements.
28 Semi-Annual Report
Lazard Emerging Markets Debt Portfolio (continued)
Forward Currency Contracts Open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
ARS | 34,999,400 | USD | 759,371 | BOA | 07/02/19 | $ | 64,546 | $ | — | |||||||||||||
ARS | 34,999,400 | USD | 824,460 | HSB | 07/02/19 | — | 543 | |||||||||||||||
ARS | 13,253,000 | USD | 295,430 | HSB | 07/05/19 | 15,079 | — | |||||||||||||||
ARS | 34,999,400 | USD | 804,584 | HSB | 07/16/19 | 1,424 | — | |||||||||||||||
ARS | 13,253,000 | USD | 302,407 | HSB | 07/19/19 | 1,383 | — | |||||||||||||||
BRL | 2,816,480 | USD | 734,951 | BOA | 07/02/19 | — | 1,483 | |||||||||||||||
BRL | 2,816,480 | USD | 733,229 | BOA | 08/02/19 | — | 1,847 | |||||||||||||||
BRL | 356,348 | USD | 92,988 | BRC | 07/02/19 | — | 188 | |||||||||||||||
BRL | 463,800 | USD | 121,027 | BRC | 07/02/19 | — | 244 | |||||||||||||||
BRL | 786,400 | USD | 205,209 | BRC | 07/02/19 | — | 414 | |||||||||||||||
BRL | 1,643,280 | USD | 428,809 | BRC | 07/02/19 | — | 865 | |||||||||||||||
BRL | 2,879,450 | USD | 751,383 | BRC | 07/02/19 | — | 1,517 | |||||||||||||||
BRL | 2,879,450 | USD | 748,999 | BRC | 08/02/19 | — | 1,264 | |||||||||||||||
BRL | 1,034,965 | USD | 270,071 | CIT | 07/02/19 | — | 545 | |||||||||||||||
BRL | 4,736,457 | USD | 1,235,963 | GSC | 07/02/19 | — | 2,494 | |||||||||||||||
BRL | 4,736,457 | USD | 1,232,778 | GSC | 08/02/19 | — | 2,817 | |||||||||||||||
BRL | 1,101,183 | USD | 284,617 | JPM | 07/02/19 | 2,153 | — | |||||||||||||||
BRL | 1,148,954 | USD | 299,851 | JPM | 07/02/19 | — | 640 | |||||||||||||||
BRL | 1,692,323 | USD | 442,727 | JPM | 07/02/19 | — | 2,012 | |||||||||||||||
BRL | 1,711,720 | USD | 445,749 | JPM | 07/02/19 | 17 | — | |||||||||||||||
BRL | 1,941,593 | USD | 488,845 | JPM | 07/02/19 | 16,785 | — | |||||||||||||||
BRL | 3,290,601 | USD | 858,671 | JPM | 07/02/19 | — | 1,733 | |||||||||||||||
BRL | 5,278,123 | USD | 1,359,115 | JPM | 07/02/19 | 15,414 | — | |||||||||||||||
BRL | 5,413,805 | USD | 1,400,943 | JPM | 07/02/19 | 8,920 | — | |||||||||||||||
BRL | 3,124,403 | USD | 817,273 | SCB | 07/02/19 | — | 3,616 | |||||||||||||||
BRL | 6,079,993 | USD | 1,586,554 | SCB | 07/02/19 | — | 3,202 | |||||||||||||||
BRL | 9,872,952 | USD | 2,438,067 | SCB | 07/02/19 | 133,048 | — | |||||||||||||||
BRL | 6,079,993 | USD | 1,582,857 | SCB | 08/02/19 | — | 4,008 | |||||||||||||||
BRL | 3,020,256 | USD | 788,126 | UBS | 07/02/19 | — | 1,591 | |||||||||||||||
BRL | 4,177,026 | USD | 1,089,981 | UBS | 07/02/19 | — | 2,200 | |||||||||||||||
BRL | 3,020,256 | USD | 786,279 | UBS | 08/02/19 | — | 1,981 | |||||||||||||||
BRL | 4,177,026 | USD | 1,086,918 | UBS | 08/02/19 | — | 2,230 | |||||||||||||||
CLP | 76,791,425 | USD | 112,581 | BRC | 08/05/19 | 797 | — | |||||||||||||||
CLP | 83,288,460 | USD | 120,012 | BRC | 08/05/19 | 2,959 | — | |||||||||||||||
CLP | 125,438,730 | USD | 181,034 | BRC | 08/05/19 | 4,169 | — |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 29
Lazard Emerging Markets Debt Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
CLP | 135,626,532 | USD | 191,820 | BRC | 08/05/19 | $ | 8,425 | $ | — | |||||||||||||
CLP | 252,299,177 | USD | 363,858 | BRC | 08/05/19 | 8,648 | — | |||||||||||||||
CLP | 77,027,593 | USD | 109,012 | UBS | 08/05/19 | 4,715 | — | |||||||||||||||
COP | 2,230,138,207 | USD | 701,191 | CIT | 07/25/19 | — | 8,250 | |||||||||||||||
COP | 564,740,000 | USD | 170,000 | SCB | 07/25/19 | 5,474 | — | |||||||||||||||
CZK | 11,809,662 | EUR | 458,481 | BOA | 07/08/19 | 6,590 | — | |||||||||||||||
CZK | 11,720,575 | EUR | 458,551 | BOA | 09/20/19 | 58 | — | |||||||||||||||
CZK | 7,808,153 | EUR | 303,350 | BRC | 07/08/19 | 4,109 | — | |||||||||||||||
CZK | 44,630,768 | EUR | 1,728,960 | BRC | 07/08/19 | 29,135 | — | |||||||||||||||
CZK | 11,720,575 | EUR | 458,507 | BRC | 09/20/19 | 108 | — | |||||||||||||||
CZK | 11,720,575 | EUR | 458,551 | SCB | 09/20/19 | 58 | — | |||||||||||||||
CZK | 15,580,710 | EUR | 603,974 | UBS | 07/08/19 | 9,728 | — | |||||||||||||||
CZK | 11,720,573 | EUR | 458,537 | UBS | 09/20/19 | 74 | — | |||||||||||||||
CZK | 8,643,731 | USD | 375,994 | BOA | 07/08/19 | 10,603 | — | |||||||||||||||
CZK | 9,305,597 | USD | 405,296 | BRC | 07/08/19 | 10,904 | — | |||||||||||||||
CZK | 13,479,778 | USD | 595,094 | BRC | 09/20/19 | 8,411 | — | |||||||||||||||
CZK | 19,934,352 | USD | 890,533 | BRC | 09/20/19 | 1,951 | — | |||||||||||||||
CZK | 1,985,024 | USD | 86,928 | CIT | 07/08/19 | 1,853 | — | |||||||||||||||
EUR | 460,624 | CZK | 11,720,575 | BOA | 07/08/19 | — | 167 | |||||||||||||||
EUR | 174,673 | CZK | 4,452,045 | BRC | 07/08/19 | — | 399 | |||||||||||||||
EUR | 460,579 | CZK | 11,720,575 | BRC | 07/08/19 | — | 218 | |||||||||||||||
EUR | 860,000 | CZK | 22,247,082 | BRC | 07/08/19 | — | 16,610 | |||||||||||||||
EUR | 460,624 | CZK | 11,720,575 | SCB | 07/08/19 | — | 167 | |||||||||||||||
EUR | 245,222 | CZK | 6,247,868 | UBS | 07/08/19 | — | 455 | |||||||||||||||
EUR | 460,601 | CZK | 11,720,573 | UBS | 07/08/19 | — | 194 | |||||||||||||||
EUR | 380,000 | PLN | 1,621,688 | JPM | 07/22/19 | — | 1,768 | |||||||||||||||
EUR | 27,558 | USD | 31,375 | UBS | 07/22/19 | 14 | — | |||||||||||||||
HUF | 46,804,938 | USD | 165,283 | BOA | 07/22/19 | — | 330 | |||||||||||||||
HUF | 46,804,939 | USD | 165,246 | BRC | 07/22/19 | — | 293 | |||||||||||||||
HUF | 740,046,363 | USD | 2,608,507 | BRC | 07/22/19 | — | 387 | |||||||||||||||
HUF | 46,804,939 | USD | 165,330 | SCB | 07/22/19 | — | 377 | |||||||||||||||
IDR | 816,393,526 | USD | 54,444 | BOA | 11/15/19 | 2,470 | — | |||||||||||||||
IDR | 2,009,000,000 | USD | 140,000 | BRC | 07/10/19 | 2,083 | — | |||||||||||||||
IDR | 1,767,355,300 | USD | 118,281 | BRC | 11/18/19 | 4,887 | — | |||||||||||||||
IDR | 3,943,666,712 | USD | 278,567 | HSB | 07/10/19 | 343 | — |
The accompanying notes are an integral part of these financial statements.
30 Semi-Annual Report
Lazard Emerging Markets Debt Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
IDR | 408,665,416 | USD | 27,253 | JPM | 11/15/19 | $ | 1,236 | $ | — | |||||||||||||
IDR | 816,782,863 | USD | 54,235 | JPM | 11/15/19 | 2,706 | — | |||||||||||||||
IDR | 3,530,888,929 | USD | 249,269 | SCB | 07/10/19 | 448 | — | |||||||||||||||
IDR | 816,260,263 | USD | 54,327 | SCB | 11/15/19 | 2,578 | — | |||||||||||||||
IDR | 1,220,881,262 | USD | 81,719 | SCB | 11/18/19 | 3,365 | — | |||||||||||||||
MXN | 91,991 | USD | 4,649 | BRC | 07/22/19 | 128 | — | |||||||||||||||
MXN | 8,592,021 | USD | 446,443 | BRC | 07/22/19 | — | 252 | |||||||||||||||
MXN | 4,943,575 | USD | 250,000 | SCB | 07/22/19 | 6,724 | — | |||||||||||||||
MYR | 228,015 | USD | 54,747 | SCB | 07/29/19 | 408 | — | |||||||||||||||
MYR | 688,857 | USD | 164,139 | SCB | 07/29/19 | 2,491 | — | |||||||||||||||
MYR | 1,167,947 | USD | 280,399 | SCB | 07/29/19 | 2,119 | — | |||||||||||||||
MYR | 5,424,828 | USD | 1,302,667 | SCB | 07/29/19 | 9,561 | — | |||||||||||||||
PEN | 1,494,825 | USD | 452,812 | CIT | 07/08/19 | 1,055 | — | |||||||||||||||
PEN | 18,161,773 | USD | 5,516,104 | HSB | 07/08/19 | — | 1,723 | |||||||||||||||
PHP | 2,153,397 | USD | 40,470 | BRC | 08/22/19 | 1,472 | — | |||||||||||||||
PHP | 4,111,200 | USD | 80,000 | BRC | 09/10/19 | 3 | — | |||||||||||||||
PHP | 42,322,500 | USD | 810,000 | HSB | 09/10/19 | 13,586 | — | |||||||||||||||
PHP | 91,346,319 | USD | 1,734,973 | SCB | 08/15/19 | 44,722 | — | |||||||||||||||
PHP | 23,548,156 | USD | 442,427 | SCB | 08/22/19 | 16,219 | — | |||||||||||||||
PHP | 41,783,800 | USD | 801,070 | SCB | 09/10/19 | 12,033 | — | |||||||||||||||
PHP | 17,938,969 | USD | 337,104 | UBS | 08/22/19 | 12,292 | — | |||||||||||||||
PLN | 1,191,884 | USD | 310,334 | BOA | 09/06/19 | 9,383 | — | |||||||||||||||
PLN | 1,698,634 | USD | 451,758 | BOA | 09/17/19 | 3,982 | — | |||||||||||||||
PLN | 1,929,995 | USD | 511,122 | BOA | 09/24/19 | 6,757 | — | |||||||||||||||
PLN | 613,040 | USD | 159,633 | BRC | 09/06/19 | 4,812 | — | |||||||||||||||
PLN | 2,495,322 | USD | 663,708 | BRC | 09/17/19 | 5,782 | — | |||||||||||||||
PLN | 1,381,734 | USD | 365,784 | BRC | 09/24/19 | 4,979 | — | |||||||||||||||
PLN | 1,804,204 | USD | 477,713 | CIT | 09/24/19 | 6,412 | — | |||||||||||||||
PLN | 3,511,739 | USD | 914,766 | HSB | 09/06/19 | 27,242 | — | |||||||||||||||
PLN | 1,872,366 | USD | 495,296 | HSB | 09/24/19 | 7,119 | — | |||||||||||||||
PLN | 2,519,746 | USD | 670,493 | SCB | 09/17/19 | 5,550 | — | |||||||||||||||
PLN | 1,786,578 | USD | 473,147 | SCB | 09/24/19 | 6,249 | — | |||||||||||||||
PLN | 776,251 | USD | 202,156 | UBS | 09/06/19 | 6,070 | — | |||||||||||||||
PLN | 2,544,171 | USD | 676,859 | UBS | 09/17/19 | 5,737 | — | |||||||||||||||
PLN | 1,557,477 | USD | 412,435 | UBS | 09/24/19 | 5,486 | — |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 31
Lazard Emerging Markets Debt Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
RON | 458,852 | USD | 108,578 | BOA | 09/05/19 | $ | 1,736 | $ | — | |||||||||||||
RON | 80,701 | USD | 19,118 | BRC | 09/05/19 | 284 | — | |||||||||||||||
RON | 458,852 | USD | 108,568 | BRC | 09/05/19 | 1,746 | — | |||||||||||||||
RON | 458,852 | USD | 108,576 | CIT | 09/05/19 | 1,738 | — | |||||||||||||||
RON | 458,852 | USD | 108,532 | HSB | 09/05/19 | 1,782 | — | |||||||||||||||
RON | 458,852 | USD | 108,613 | SCB | 09/05/19 | 1,701 | — | |||||||||||||||
RON | 458,849 | USD | 108,569 | UBS | 09/05/19 | 1,744 | — | |||||||||||||||
RUB | 6,048,900 | USD | 90,000 | BRC | 07/31/19 | 5,261 | — | |||||||||||||||
RUB | 22,791,390 | USD | 340,000 | BRC | 07/31/19 | 18,930 | — | |||||||||||||||
RUB | 35,080,551 | USD | 519,231 | CIT | 07/31/19 | 33,234 | — | |||||||||||||||
RUB | 30,652,490 | USD | 454,010 | HSB | 07/31/19 | 28,720 | — | |||||||||||||||
RUB | 14,651,586 | USD | 224,202 | UBS | 07/31/19 | 6,538 | — | |||||||||||||||
THB | 2,316,734 | USD | 74,421 | BRC | 09/23/19 | 1,268 | — | |||||||||||||||
TRY | 480,960 | USD | 80,000 | BRC | 07/17/19 | 2,331 | — | |||||||||||||||
TRY | 635,712 | USD | 110,000 | BRC | 07/17/19 | — | 1,178 | |||||||||||||||
TRY | 692,653 | USD | 115,450 | BRC | 07/17/19 | 3,120 | — | |||||||||||||||
TRY | 850,069 | USD | 147,249 | BRC | 07/17/19 | — | 1,733 | |||||||||||||||
TRY | 1,078,350 | USD | 170,000 | UBS | 07/17/19 | 14,594 | — | |||||||||||||||
TWD | 8,067,588 | USD | 257,011 | BRC | 08/16/19 | 3,411 | — | |||||||||||||||
TWD | 15,473,434 | USD | 492,989 | CIT | 08/16/19 | 6,495 | — | |||||||||||||||
UAH | 5,948,800 | USD | 220,000 | BOA | 09/25/19 | — | 348 | |||||||||||||||
UAH | 5,948,800 | USD | 220,000 | SCB | 09/25/19 | — | 348 | |||||||||||||||
USD | 824,460 | ARS | 34,999,400 | BOA | 07/02/19 | 543 | — | |||||||||||||||
USD | 817,743 | ARS | 34,999,400 | HSB | 07/02/19 | — | 6,174 | |||||||||||||||
USD | 308,209 | ARS | 13,253,000 | HSB | 07/05/19 | — | 2,300 | |||||||||||||||
USD | 735,373 | BRL | 2,816,480 | BOA | 07/02/19 | 1,905 | — | |||||||||||||||
USD | 92,187 | BRL | 356,348 | BRC | 07/02/19 | — | 613 | |||||||||||||||
USD | 120,000 | BRL | 463,800 | BRC | 07/02/19 | — | 783 | |||||||||||||||
USD | 200,000 | BRL | 786,400 | BRC | 07/02/19 | — | 4,794 | |||||||||||||||
USD | 410,000 | BRL | 1,643,280 | BRC | 07/02/19 | — | 17,943 | |||||||||||||||
USD | 751,128 | BRL | 2,879,450 | BRC | 07/02/19 | 1,262 | — | |||||||||||||||
USD | 267,813 | BRL | 1,034,965 | CIT | 07/02/19 | — | 1,712 | |||||||||||||||
USD | 1,236,350 | BRL | 4,736,457 | GSC | 07/02/19 | 2,882 | — | |||||||||||||||
USD | 287,350 | BRL | 1,101,183 | JPM | 07/02/19 | 580 | — | |||||||||||||||
USD | 299,816 | BRL | 1,148,954 | JPM | 07/02/19 | 605 | — |
The accompanying notes are an integral part of these financial statements.
32 Semi-Annual Report
Lazard Emerging Markets Debt Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
USD | 441,606 | BRL | 1,692,323 | JPM | 07/02/19 | $ | 891 | $ | — | |||||||||||||
USD | 446,668 | BRL | 1,711,720 | JPM | 07/02/19 | 901 | — | |||||||||||||||
USD | 506,652 | BRL | 1,941,593 | JPM | 07/02/19 | 1,023 | — | |||||||||||||||
USD | 821,418 | BRL | 3,290,601 | JPM | 07/02/19 | — | 35,520 | |||||||||||||||
USD | 1,377,309 | BRL | 5,278,123 | JPM | 07/02/19 | 2,780 | — | |||||||||||||||
USD | 1,412,715 | BRL | 5,413,805 | JPM | 07/02/19 | 2,851 | — | |||||||||||||||
USD | 1,131,039 | BRL | 4,344,829 | JPM | 08/02/19 | 2,776 | — | |||||||||||||||
USD | 815,303 | BRL | 3,124,403 | SCB | 07/02/19 | 1,645 | — | |||||||||||||||
USD | 1,587,466 | BRL | 6,079,993 | SCB | 07/02/19 | 4,113 | — | |||||||||||||||
USD | 2,576,314 | BRL | 9,872,952 | SCB | 07/02/19 | 5,200 | — | |||||||||||||||
USD | 788,579 | BRL | 3,020,256 | UBS | 07/02/19 | 2,043 | — | |||||||||||||||
USD | 1,089,981 | BRL | 4,177,026 | UBS | 07/02/19 | 2,200 | — | |||||||||||||||
USD | 70,000 | CLP | 47,512,500 | BRC | 08/05/19 | — | 150 | |||||||||||||||
USD | 266,193 | CLP | 186,388,185 | BRC | 08/05/19 | — | 8,999 | |||||||||||||||
USD | 260,000 | COP | 844,740,000 | BRC | 07/25/19 | — | 2,475 | |||||||||||||||
USD | 360,000 | COP | 1,157,760,000 | BRC | 07/25/19 | 264 | — | |||||||||||||||
USD | 889,569 | CZK | 19,934,352 | BRC | 07/08/19 | — | 2,010 | |||||||||||||||
USD | 849,058 | EUR | 747,739 | BOA | 07/22/19 | — | 2,611 | |||||||||||||||
USD | 210,000 | EUR | 184,389 | BRC | 07/22/19 | — | 18 | |||||||||||||||
USD | 849,075 | EUR | 747,738 | BRC | 07/22/19 | — | 2,593 | |||||||||||||||
USD | 848,701 | EUR | 747,738 | SCB | 07/22/19 | — | 2,967 | |||||||||||||||
USD | 31,339 | EUR | 27,558 | UBS | 07/08/19 | — | 14 | |||||||||||||||
USD | 927,566 | HUF | 263,523,018 | BRC | 07/22/19 | — | 1,158 | |||||||||||||||
USD | 65,906 | HUF | 18,627,507 | SCB | 07/22/19 | 257 | — | |||||||||||||||
USD | 708,344 | HUF | 201,362,502 | UBS | 07/22/19 | — | 1,311 | |||||||||||||||
USD | 1,021,905 | HUF | 289,175,009 | UBS | 07/22/19 | 2,775 | — | |||||||||||||||
USD | 36,055 | IDR | 516,301,612 | BOA | 07/15/19 | — | 440 | |||||||||||||||
USD | 53,774 | IDR | 777,842,847 | BRC | 07/10/19 | — | 1,238 | |||||||||||||||
USD | 200,000 | IDR | 2,837,400,000 | BRC | 08/12/19 | 81 | — | |||||||||||||||
USD | 191,599 | IDR | 2,858,102,068 | BRC | 11/15/19 | — | 7,652 | |||||||||||||||
USD | 254,678 | IDR | 3,800,082,972 | BRC | 11/18/19 | — | 10,152 | |||||||||||||||
USD | 84,361 | IDR | 1,211,761,062 | CIT | 07/17/19 | — | 1,272 | |||||||||||||||
USD | 365,723 | IDR | 5,287,624,121 | HSB | 07/10/19 | — | 8,236 | |||||||||||||||
USD | 124,475 | IDR | 1,783,480,917 | HSB | 07/15/19 | — | 1,588 | |||||||||||||||
USD | 277,293 | IDR | 3,943,666,712 | HSB | 08/12/19 | — | 572 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 33
Lazard Emerging Markets Debt Portfolio (continued)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
USD | 687,451 | IDR | 9,941,233,687 | JPM | 07/10/19 | $ | — | $ | 15,627 | |||||||||||||
USD | 251,793 | IDR | 3,641,682,235 | SCB | 07/10/19 | — | 5,759 | |||||||||||||||
USD | 419,195 | IDR | 6,068,262,320 | SCB | 07/10/19 | — | 9,974 | |||||||||||||||
USD | 120,313 | IDR | 1,724,081,922 | SCB | 07/15/19 | — | 1,552 | |||||||||||||||
USD | 80,042 | IDR | 1,149,807,385 | SCB | 07/17/19 | — | 1,212 | |||||||||||||||
USD | 84,155 | IDR | 1,210,153,785 | SCB | 07/17/19 | — | 1,364 | |||||||||||||||
USD | 84,463 | IDR | 1,211,198,387 | SCB | 07/17/19 | — | 1,130 | |||||||||||||||
USD | 5,718 | IDR | 82,418,100 | SCB | 07/19/19 | — | 106 | |||||||||||||||
USD | 101,316 | IDR | 1,456,420,591 | SCB | 07/22/19 | — | 1,549 | |||||||||||||||
USD | 248,130 | IDR | 3,530,888,929 | SCB | 08/12/19 | — | 652 | |||||||||||||||
USD | 90,643 | IDR | 1,306,614,020 | UBS | 07/19/19 | — | 1,673 | |||||||||||||||
USD | 651,701 | MXN | 12,568,370 | BRC | 07/22/19 | — | 986 | |||||||||||||||
USD | 330,000 | MXN | 6,526,575 | SCB | 07/22/19 | — | 8,931 | |||||||||||||||
USD | 652,072 | MXN | 12,568,370 | SCB | 07/22/19 | — | 614 | |||||||||||||||
USD | 651,903 | MXN | 12,568,370 | UBS | 07/22/19 | — | 783 | |||||||||||||||
USD | 171,457 | MYR | 709,781 | SCB | 07/29/19 | — | 234 | |||||||||||||||
USD | 110,000 | PEN | 371,580 | BRC | 07/17/19 | — | 2,775 | |||||||||||||||
USD | 120,000 | PEN | 400,200 | BRC | 07/17/19 | — | 1,462 | |||||||||||||||
USD | 190,000 | PEN | 626,620 | BRC | 09/09/19 | 239 | — | |||||||||||||||
USD | 5,837,669 | PEN | 19,656,598 | HSB | 07/08/19 | — | 130,580 | |||||||||||||||
USD | 5,499,401 | PEN | 18,161,773 | HSB | 09/09/19 | — | 583 | |||||||||||||||
USD | 64,658 | RON | 273,013 | BRC | 09/05/19 | — | 978 | |||||||||||||||
USD | 155,602 | RON | 655,925 | BRC | 09/05/19 | — | 2,091 | |||||||||||||||
USD | 280,808 | RON | 1,186,429 | BRC | 09/05/19 | — | 4,424 | |||||||||||||||
USD | 556,808 | RON | 2,351,039 | BRC | 09/05/19 | — | 8,411 | |||||||||||||||
USD | 190,000 | RON | 790,172 | SCB | 09/05/19 | 33 | — | |||||||||||||||
USD | 74,566 | RON | 314,795 | UBS | 09/05/19 | — | 1,115 | |||||||||||||||
USD | 216,533 | RON | 916,323 | UBS | 09/05/19 | — | 3,762 | |||||||||||||||
USD | 219,956 | RON | 930,809 | UBS | 09/05/19 | — | 3,822 | |||||||||||||||
USD | 48,015 | RUB | 3,146,777 | BRC | 07/31/19 | — | 1,542 | |||||||||||||||
USD | 220,000 | RUB | 14,430,130 | BRC | 07/31/19 | — | 7,252 | |||||||||||||||
USD | 690,000 | RUB | 46,314,525 | BRC | 07/31/19 | — | 39,383 | |||||||||||||||
USD | 103,807 | RUB | 6,796,234 | JPM | 07/31/19 | — | 3,223 | |||||||||||||||
USD | 437,900 | RUB | 28,578,018 | JPM | 07/31/19 | — | 12,160 | |||||||||||||||
USD | 120,000 | THB | 3,676,200 | SCB | 09/23/19 | — | 104 |
The accompanying notes are an integral part of these financial statements.
34 Semi-Annual Report
Lazard Emerging Markets Debt Portfolio (concluded)
Currency | Currency | Settlement | Unrealized | Unrealized | ||||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | |||||||||||||||
USD | 180,000 | TRY | 1,122,210 | BRC | 07/17/19 | $ | — | $ | 12,102 | |||||||||||||
USD | 207,378 | TRY | 1,226,186 | BRC | 07/17/19 | — | 2,522 | |||||||||||||||
USD | 227,863 | TRY | 1,341,634 | BRC | 07/17/19 | — | 1,800 | |||||||||||||||
USD | 386,035 | TRY | 2,380,870 | BRC | 07/17/19 | — | 21,526 | |||||||||||||||
USD | 440,579 | TRY | 2,613,292 | BRC | 07/17/19 | — | 6,769 | |||||||||||||||
USD | 54,619 | TRY | 318,435 | HSB | 07/17/19 | 109 | — | |||||||||||||||
USD | 80,000 | TRY | 494,368 | SCB | 07/17/19 | — | 4,627 | |||||||||||||||
USD | 410,000 | TRY | 2,392,957 | SCB | 07/17/19 | 370 | — | |||||||||||||||
USD | 132,966 | TRY | 786,556 | UBS | 07/17/19 | — | 1,678 | |||||||||||||||
USD | 270,000 | TRY | 1,580,354 | UBS | 07/17/19 | — | 527 | |||||||||||||||
USD | 1,627,489 | TWD | 50,194,034 | UBS | 08/16/19 | 7,222 | — | |||||||||||||||
USD | 98,390 | ZAR | 1,445,822 | BRC | 07/24/19 | — | 3,981 | |||||||||||||||
UYU | 7,540,880 | USD | 212,001 | CIT | 09/13/19 | — | 640 | |||||||||||||||
ZAR | 1,131,164 | USD | 80,000 | SCB | 07/24/19 | 92 | — | |||||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 806,316 | $ | 529,911 |
Interest Rate Swap Agreements open at June 30, 2019:
Receive | Payment | |||||||||||||||||||
Notional | Expiration | (Pay) | Frequency | Variable | Unrealized | |||||||||||||||
Currency | Counterparty | Amount | Date | Rate | Paid/Received | Rate | Appreciation | |||||||||||||
BRL | GSC | $ | 10,986,507 | 07/01/21 | 7.55% | Maturity | Brazil Cetip Interbank Deposit Rate | $ | 81,488 |
Centrally Cleared Interest Rate Swap Agreements open at June 30, 2019:
Receive | Payment | |||||||||||||||||||
Notional | Expiration | (Pay) | Frequency | Variable | Unrealized | |||||||||||||||
Currency | Counterparty | Amount | Date | Rate | Paid/Received | Rate | Appreciation | |||||||||||||
BRL | GSC | $ | 18,724,202 | 07/01/21 | 7.42% | Maturity | Brazil Cetip Interbank Deposit Rate | $ | 142,134 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 35
The accompanying notes are an integral part of these financial statements.
36 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
United States | 22.1% | ||||||||||
American Express Co., 3.000%, 10/30/24 | USD | 60 | $ | 61,472 | ||||||
Apple, Inc., 3.850%, 05/04/43 | USD | 110 | 116,731 | |||||||
Ball Corp., 4.000%, 11/15/23 | USD | 35 | 36,181 | |||||||
Bank of America Corp., 3.499%, 05/17/22 (§) | USD | 70 | 71,383 | |||||||
Citigroup, Inc., 3.095% (BBSW 3 Month + 1.550%), 05/04/21 (§) | AUD | 110 | 78,361 | |||||||
Constellation Brands, Inc., 4.250%, 05/01/23 | USD | 65 | 69,135 | |||||||
DaVita, Inc., 5.125%, 07/15/24 | USD | 30 | 30,009 | |||||||
HCA, Inc., 5.000%, 03/15/24 | USD | 45 | 49,003 | |||||||
John Deere Canada Funding, Inc., 2.050%, 09/17/20 | CAD | 85 | 64,955 | |||||||
Johnson & Johnson, 3.625%, 03/03/37 | USD | 65 | 69,512 | |||||||
JPMorgan Chase & Co., 4.500%, 01/24/22 | USD | 45 | 47,402 | |||||||
McDonald’s Corp., 3.125%, 03/04/25 | CAD | 80 | 63,196 | |||||||
Microsoft Corp., 4.450%, 11/03/45 | USD | 95 | 113,797 | |||||||
Morgan Stanley, 3.625%, 01/20/27 | USD | 90 | 94,532 | |||||||
Nestle Holdings, Inc., 2.750%, 04/15/20 | NOK | 340 | 40,210 | |||||||
NIKE, Inc., 2.375%, 11/01/26 | USD | 90 | 90,196 | |||||||
Sealed Air Corp., 4.875%, 12/01/22 | USD | 30 | 31,463 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 37
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
Service Corp. International, 4.625%, 12/15/27 | USD | 25 | $ | 25,531 | ||||||
Starbucks Corp., 4.450%, 08/15/49 | USD | 60 | 65,622 | |||||||
The Goldman Sachs Group, Inc., 3.625%, 01/22/23 | USD | 35 | 36,294 | |||||||
United Rentals North America, Inc., 4.625%, 07/15/23 | USD | 35 | 35,726 | |||||||
Verizon Communications, Inc., 3.875%, 02/08/29 | USD | 75 | 80,406 | |||||||
1,371,117 | ||||||||||
Total Corporate Bonds (Cost $1,836,058) | 1,876,802 | |||||||||
Foreign Government Obligations | 45.2% | ||||||||||
Australia | 1.1% | ||||||||||
Queensland Treasury Corp., 3.000%, 03/22/24 | AUD | 94 | 71,065 | |||||||
Bahamas | 2.1% | ||||||||||
Commonwealth of Bahamas, 6.950%, 11/20/29 | USD | 118 | 131,570 | |||||||
Bermuda | 3.3% | ||||||||||
Government of Bermuda, 3.717%, 01/25/27 | USD | 200 | 203,250 | |||||||
Canada | 1.6% | ||||||||||
City of Vancouver, 2.900%, 11/20/25 | CAD | 60 | 48,072 | |||||||
Province of Quebec, 1.650%, 03/03/22 | CAD | 70 | 53,459 | |||||||
101,531 |
The accompanying notes are an integral part of these financial statements.
38 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
Chile | 3.4% | ||||||||||
Bonos de la Tesoreria de la Republica en pesos: | ||||||||||
4.500%, 03/01/26 | CLP | 90,000 | $ | 143,781 | ||||||
5.000%, 03/01/35 | CLP | 40,000 | 69,775 | |||||||
213,556 | ||||||||||
Colombia | 0.9% | ||||||||||
Republic of Colombia, 9.850%, 06/28/27 | COP | 148,000 | 57,747 | |||||||
Croatia | 1.7% | ||||||||||
Croatia Government International Bonds, 6.625%, 07/14/20 | USD | 100 | 104,000 | |||||||
Czech Republic | 3.1% | ||||||||||
Czech Republic: | ||||||||||
2.150% (PRIBOR 6 Month - 0.100%), 11/19/27 (§) | CZK | 1,390 | 62,881 | |||||||
2.500%, 08/25/28 | CZK | 2,600 | 126,418 | |||||||
189,299 | ||||||||||
France | 2.3% | ||||||||||
Government of France, 1.750%, 06/25/39 | EUR | 104 | 144,071 | |||||||
Hungary | 3.2% | ||||||||||
Hungary, 6.375%, 03/29/21 | USD | 60 | 64,030 | |||||||
Hungary Government Bonds: | ||||||||||
3.000%, 10/27/27 | HUF | 19,650 | 73,270 | |||||||
3.000%, 08/21/30 | HUF | 17,280 | 63,027 | |||||||
200,327 | ||||||||||
Ireland | 3.1% | ||||||||||
Ireland Government Bonds: | ||||||||||
1.350%, 03/18/31 | EUR | 50 | 63,247 | |||||||
1.700%, 05/15/37 | EUR | 100 | 131,606 | |||||||
194,853 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 39
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
Italy | 1.1% | ||||||||||
Italy Government International Bonds, 6.875%, 09/27/23 | USD | 60 | $ | 67,828 | ||||||
Mexico | 2.0% | ||||||||||
Mexican Bonos, 6.500%, 06/09/22 | MXN | 1,390 | 70,710 | |||||||
United Mexican States, 6.750%, 02/06/24 | GBP | 35 | 52,906 | |||||||
123,616 | ||||||||||
New Zealand | 1.1% | ||||||||||
New Zealand Government Bonds, 6.000%, 05/15/21 | NZD | 90 | 65,396 | |||||||
Norway | 1.9% | ||||||||||
Oslo Kommune, 2.350%, 09/04/24 | NOK | 1,000 | 119,128 | |||||||
Peru | 1.0% | ||||||||||
Peru Government Bonds, 6.150%, 08/12/32 (#) | PEN | 190 | 63,198 | |||||||
Philippines | 1.7% | ||||||||||
Philippine Government Bonds, 4.250%, 04/11/20 | PHP | 5,460 | 105,957 | |||||||
Poland | 2.2% | ||||||||||
Poland Government Bonds, 2.500%, 07/25/26 | PLN | 490 | 133,340 | |||||||
Romania | 3.2% | ||||||||||
Romanian Government Bonds: | ||||||||||
4.750%, 02/24/25 | RON | 505 | 123,824 | |||||||
2.375%, 04/19/27 | EUR | 60 | 73,897 | |||||||
197,721 |
The accompanying notes are an integral part of these financial statements.
40 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
Singapore | 1.0% | ||||||||||
Singapore Government Bonds, 3.375%, 09/01/33 | SGD | 75 | $ | 62,709 | ||||||
Spain | 2.2% | ||||||||||
Spain Government Bonds, 1.400%, 04/30/28 | EUR | 107 | 133,604 | |||||||
United Kingdom | 2.0% | ||||||||||
United Kingdom Gilt: | ||||||||||
1.750%, 09/07/37 | GBP | 47 | 63,525 | |||||||
1.500%, 07/22/47 | GBP | 45 | 57,467 | |||||||
120,992 | ||||||||||
Total Foreign Government Obligations (Cost $2,756,256) | 2,804,758 | |||||||||
Quasi Government Bonds | 1.5% | ||||||||||
Canada | 1.5% | ||||||||||
Export Development Canada, 1.800%, 09/01/22 (Cost $94,163) | CAD | 125 | 95,968 | |||||||
Supranational Bonds | 12.4% | ||||||||||
African Development Bank, 2.375%, 09/23/21 | USD | 90 | 91,034 | |||||||
Asian Development Bank: | ||||||||||
1.000%, 12/15/22 | GBP | 55 | 70,045 | |||||||
2.125%, 03/19/25 | USD | 77 | 77,900 | |||||||
European Investment Bank, 1.125%, 09/16/21 (#) | CAD | 90 | 68,017 | |||||||
International Bank for Reconstruction & Development: | ||||||||||
5.750%, 10/28/19 | INR | 1,500 | 21,554 | |||||||
3.500%, 01/22/21 | NZD | 50 | 34,574 | |||||||
2.500%, 08/03/23 | CAD | 135 | 106,227 | |||||||
2.900%, 11/26/25 | AUD | 40 | 30,321 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 41
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||||
International Finance Corp.: | ||||||||||
3.625%, 05/20/20 | NZD | 85 | $ | 58,138 | ||||||
2.700%, 03/15/23 | AUD | 85 | 62,544 | |||||||
2.125%, 04/07/26 | USD | 145 | 146,424 | |||||||
Total Supranational Bonds (Cost $760,884) | 766,778 | |||||||||
US Municipal Bonds | 2.0% | ||||||||||
California | 2.0% | ||||||||||
California State Build America Bonds, 7.500%, 04/01/34 | USD | 50 | 75,470 | |||||||
State of California, 4.500%, 04/01/33 | USD | 45 | 50,890 | |||||||
Total US Municipal Bonds (Cost $120,612) | �� | 126,360 | ||||||||
US Treasury Securities | 7.8% | ||||||||||
Treasury Inflation Protected Security, 0.125%, 04/15/20 | USD | 55 | 53,980 | |||||||
US Treasury Notes: | ||||||||||
2.125%, 05/15/25 | USD | 160 | 162,612 | |||||||
2.875%, 08/15/28 | USD | 186 | 199,776 | |||||||
3.125%, 11/15/41 | USD | 58 | 64,853 | |||||||
Total US Treasury Securities (Cost $456,501) | 481,221 |
The accompanying notes are an integral part of these financial statements.
42 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Global Fixed Income Portfolio (continued) | ||||||||
Short-Term Investments | 0.4% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $23,436) | 23,436 | $ | 23,436 | |||||
Total Investments | 99.5% (Cost $6,047,910) (») | $ | 6,175,323 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.5% | 31,862 | |||||||
Net Assets | 100.0% | $ | 6,207,185 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 43
Lazard Global Fixed Income Portfolio (continued)
Forward Currency Contracts open at June 30, 2019:
Currency Purchased | Quantity | Currency Sold | Quantity | Counterparty | Settlement Date | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||||
AUD | 104,252 | USD | 72,993 | HSB | 08/14/19 | $ | 301 | $ | — | |||||||||||||
AUD | 29,049 | USD | 20,300 | MSC | 08/14/19 | 123 | — | |||||||||||||||
CAD | 42,325 | USD | 31,700 | JPM | 08/14/19 | 649 | — | |||||||||||||||
CHF | 43,414 | USD | 43,542 | HSB | 08/14/19 | 1,107 | — | |||||||||||||||
CZK | 1,404,695 | EUR | 54,400 | JPM | 07/25/19 | 871 | — | |||||||||||||||
EUR | 32,787 | USD | 37,000 | CIT | 07/11/19 | 310 | — | |||||||||||||||
EUR | 58,705 | USD | 66,275 | HSB | 07/11/19 | 530 | — | |||||||||||||||
EUR | 103,651 | USD | 116,776 | HSB | 07/11/19 | 1,176 | — | |||||||||||||||
EUR | 582,862 | USD | 659,319 | HSB | 07/11/19 | 3,958 | — | |||||||||||||||
EUR | 110,882 | USD | 125,452 | JPM | 07/11/19 | 728 | — | |||||||||||||||
GBP | 10,915 | USD | 14,000 | JPM | 08/14/19 | — | 110 | |||||||||||||||
GBP | 29,471 | USD | 38,344 | JPM | 08/14/19 | — | 840 | |||||||||||||||
HUF | 2,536,231 | USD | 8,937 | JPM | 08/08/19 | 11 | — | |||||||||||||||
IDR | 257,849,500 | USD | 17,900 | HSB | 09/11/19 | 206 | — | |||||||||||||||
JPY | 3,951,680 | USD | 37,056 | CIT | 08/14/19 | — | 286 | |||||||||||||||
JPY | 43,226,736 | USD | 398,786 | CIT | 08/14/19 | 3,438 | — | |||||||||||||||
JPY | 80,809,595 | USD | 745,538 | HSB | 08/14/19 | 6,395 | — | |||||||||||||||
JPY | 5,732,788 | USD | 53,600 | JPM | 08/14/19 | — | 256 | |||||||||||||||
KRW | 87,334,260 | USD | 74,100 | HSB | 08/05/19 | 1,613 | — | |||||||||||||||
NOK | 529,688 | USD | 60,726 | HSB | 08/14/19 | 1,451 | — | |||||||||||||||
NOK | 1,005,889 | USD | 117,864 | HSB | 08/14/19 | 210 | — | |||||||||||||||
NZD | 40,119 | USD | 26,500 | HSB | 08/14/19 | 477 | — | |||||||||||||||
SEK | 261,870 | USD | 27,800 | MSC | 08/14/19 | 489 | — | |||||||||||||||
USD | 134,560 | AUD | 192,839 | CIT | 08/14/19 | — | 1,014 | |||||||||||||||
USD | 120,684 | AUD | 172,907 | HSB | 08/14/19 | — | 877 | |||||||||||||||
USD | 21,469 | AUD | 30,758 | JPM | 08/14/19 | — | 155 | |||||||||||||||
USD | 79,888 | CAD | 107,484 | CIT | 08/14/19 | — | 2,264 | |||||||||||||||
USD | 270,638 | CAD | 363,919 | HSB | 08/14/19 | — | 7,511 | |||||||||||||||
USD | 103,156 | CAD | 138,714 | JPM | 08/14/19 | — | 2,866 | |||||||||||||||
USD | 197,729 | CLP | 132,195,416 | CIT | 07/25/19 | 2,575 | — | |||||||||||||||
USD | 58,665 | COP | 194,179,641 | CIT | 09/10/19 | — | 1,508 | |||||||||||||||
USD | 62,352 | CZK | 1,421,240 | JPM | 07/25/19 | — | 1,236 | |||||||||||||||
USD | 55,373 | EUR | 48,884 | HSB | 07/11/19 | — | 255 | |||||||||||||||
USD | 61,929 | EUR | 54,664 | HSB | 07/11/19 | — | 276 | |||||||||||||||
USD | 111,334 | EUR | 98,423 | HSB | 07/11/19 | — | 668 | |||||||||||||||
USD | 61,870 | EUR | 54,845 | JPM | 07/11/19 | — | 542 | |||||||||||||||
USD | 1,645 | GBP | 1,264 | JPM | 08/14/19 | 36 | — | |||||||||||||||
USD | 21,721 | HUF | 6,316,247 | JPM | 08/08/19 | — | 562 | |||||||||||||||
USD | 106,805 | HUF | 30,687,094 | JPM | 08/08/19 | — | 1,460 |
The accompanying notes are an integral part of these financial statements.
44 Semi-Annual Report
Lazard Global Fixed Income Portfolio (concluded)
Currency Purchased | Quantity | Currency Sold | Quantity | Counterparty | Settlement Date | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||||
USD | 20,097 | INR | 1,414,348 | CIT | 07/24/19 | $ | — | $ | 337 | |||||||||||||
USD | 162,733 | JPY | 17,638,750 | HSB | 08/14/19 | — | 1,396 | |||||||||||||||
USD | 61,800 | JPY | 6,656,778 | MSC | 08/14/19 | — | 141 | |||||||||||||||
USD | 33,264 | MXN | 648,669 | HSB | 08/14/19 | — | 294 | |||||||||||||||
USD | 20,922 | MXN | 408,092 | JPM | 08/14/19 | — | 190 | |||||||||||||||
USD | 87,848 | NOK | 766,267 | HSB | 08/14/19 | — | 2,099 | |||||||||||||||
USD | 119,216 | NOK | 1,040,142 | HSB | 08/14/19 | — | 2,880 | |||||||||||||||
USD | 49,813 | NZD | 75,646 | CIT | 08/14/19 | — | 1,052 | |||||||||||||||
USD | 98,336 | NZD | 149,341 | HSB | 08/14/19 | — | 2,083 | |||||||||||||||
USD | 35,067 | NZD | 53,252 | JPM | 08/14/19 | — | 740 | |||||||||||||||
USD | 49,122 | PEN | 165,000 | JPM | 08/21/19 | — | 884 | |||||||||||||||
USD | 105,240 | PHP | 5,488,806 | HSB | 07/24/19 | — | 1,800 | |||||||||||||||
USD | 113,545 | PLN | 434,261 | HSB | 08/14/19 | — | 2,891 | |||||||||||||||
USD | 125,279 | RON | 519,907 | HSB | 09/27/19 | 347 | — | |||||||||||||||
USD | 10,374 | SGD | 14,193 | HSB | 08/14/19 | — | 123 | |||||||||||||||
USD | 37,469 | SGD | 51,275 | JPM | 08/14/19 | — | 456 | |||||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 27,001 | $ | 40,052 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 45
The accompanying notes are an integral part of these financial statements.
46 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Mosaic Global Holdings, Inc., 7.300%, 01/15/28 | $ | 775 | $ | 951,660 | ||||
NOVA Chemicals Corp., 5.250%, 08/01/23 (#) | 1,550 | 1,571,313 | ||||||
Valvoline, Inc., 4.375%, 08/15/25 | 1,500 | 1,496,250 | ||||||
WR Grace & Co-Conn, 5.125%, 10/01/21 (#) | 1,700 | 1,763,750 | ||||||
7,512,285 | ||||||||
Commercial Services & Supplies | 4.3% | ||||||||
ACCO Brands Corp., 5.250%, 12/15/24 (#) | 1,800 | 1,822,500 | ||||||
Aramark Services, Inc., 5.000%, 04/01/25 (#) | 2,000 | 2,030,000 | ||||||
Ashtead Capital, Inc., 4.375%, 08/15/27 (#) | 1,900 | 1,902,375 | ||||||
Clean Harbors, Inc., 4.875%, 07/15/27 (#) | 1,600 | 1,626,160 | ||||||
KAR Auction Services, Inc., 5.125%, 06/01/25 (#) | 1,800 | 1,831,500 | ||||||
Multi-Color Corp., 4.875%, 11/01/25 (#) | 1,750 | 1,839,687 | ||||||
The ADT Security Corp.: 6.250%, 10/15/21 | 1,400 | 1,480,500 | ||||||
4.125%, 06/15/23 | 500 | 500,000 | ||||||
13,032,722 | ||||||||
Communications Equipment | 1.1% | ||||||||
CommScope, Inc., 5.000%, 06/15/21 (#) | 1,500 | 1,496,250 | ||||||
Plantronics, Inc., 5.500%, 05/31/23 (#) | 1,750 | 1,741,250 | ||||||
3,237,500 | ||||||||
Construction Materials | 1.2% | ||||||||
James Hardie International Finance DAC, 5.000%, 01/15/28 (#) | 1,760 | 1,751,200 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 47
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Standard Industries, Inc., 5.375%, 11/15/24 (#) | $ | 1,750 | $ | 1,811,250 | ||||
3,562,450 | ||||||||
Containers & Packaging | 4.0% | ||||||||
Ball Corp., 4.000%, 11/15/23 | 2,100 | 2,170,875 | ||||||
Cascades, Inc., 5.500%, 07/15/22 (#) | 1,500 | 1,505,625 | ||||||
Crown Americas LLC: 4.500%, 01/15/23 | 1,550 | 1,613,937 | ||||||
4.250%, 09/30/26 | 500 | 510,000 | ||||||
Owens-Brockway Glass Container, Inc., 5.000%, 01/15/22 (#) | 2,092 | 2,144,300 | ||||||
Reynolds Group Issuer, Inc., 5.750%, 10/15/20 | 1,454 | 1,457,296 | ||||||
Sealed Air Corp., 4.875%, 12/01/22 (#) | 1,700 | 1,782,875 | ||||||
Smurfit Kappa Treasury Funding DAC, 7.500%, 11/20/25 | 750 | 871,875 | ||||||
12,056,783 | ||||||||
Diversified Consumer Services | 1.2% | ||||||||
Service Corp. International, 4.625%, 12/15/27 | 1,750 | 1,787,188 | ||||||
The ServiceMaster Co. LLC, 5.125%, 11/15/24 (#) | 1,800 | 1,851,750 | ||||||
3,638,938 | ||||||||
Diversified Financial Services | 1.5% | ||||||||
Herc Rentals, Inc., 7.750%, 06/01/24 (#) | 1,189 | 1,259,389 | ||||||
INEOS Group Holdings SA, 5.625%, 08/01/24 (#) | 1,700 | 1,734,000 | ||||||
Level 3 Financing, Inc., 5.125%, 05/01/23 | 1,550 | 1,562,942 | ||||||
4,556,331 |
The accompanying notes are an integral part of these financial statements.
48 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Diversified Telecommunication Services | 3.2% | ||||||||
CenturyLink, Inc., 5.625%, 04/01/20 | $ | 1,550 | $ | 1,567,438 | ||||
CyrusOne LP, 5.000%, 03/15/24 | 2,000 | 2,055,000 | ||||||
Hughes Satellite Systems Corp., 5.250%, 08/01/26 | 2,091 | 2,148,502 | ||||||
SBA Communications Corp., 4.875%, 09/01/24 | 2,000 | 2,060,000 | ||||||
Zayo Group LLC, 5.750%, 01/15/27 (#) | 1,950 | 1,984,125 | ||||||
9,815,065 | ||||||||
Energy Equipment & Services | 1.0% | ||||||||
Precision Drilling Corp., 5.250%, 11/15/24 | 1,500 | 1,387,500 | ||||||
Transocean, Inc., 9.000%, 07/15/23 (#) | 1,500 | 1,597,500 | ||||||
2,985,000 | ||||||||
Entertainment | 1.2% | ||||||||
Live Nation Entertainment, Inc., 4.875%, 11/01/24 (#) | 1,550 | 1,594,563 | ||||||
Netflix, Inc.: 5.375%, 02/01/21 | 1,550 | 1,602,312 | ||||||
4.375%, 11/15/26 | 500 | 511,400 | ||||||
3,708,275 | ||||||||
Equity Real Estate Investment Trusts (REITs) | 3.6% | ||||||||
Equinix, Inc., 5.375%, 05/15/27 | 2,200 | 2,358,334 | ||||||
ESH Hospitality, Inc., 5.250%, 05/01/25 (#) | 2,000 | 2,050,000 | ||||||
Iron Mountain, Inc., 6.000%, 08/15/23 | 1,450 | 1,489,875 | ||||||
MGM Growth Properties Operating Partnership LP, 4.500%, 09/01/26 | 1,800 | 1,840,500 | ||||||
RHP Hotel Properties LP, 5.000%, 04/15/23 | 1,525 | 1,545,969 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 49
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Uniti Group LP, 6.000%, 04/15/23 (#) | $ | 1,700 | $ | 1,615,000 | ||||
10,899,678 | ||||||||
Food & Staples Retailing | 1.7% | ||||||||
Albertsons Cos. LLC, 6.625%, 06/15/24 | 1,750 | 1,813,438 | ||||||
Ingles Markets, Inc., 5.750%, 06/15/23 | 1,500 | 1,533,750 | ||||||
Performance Food Group, Inc., 5.500%, 06/01/24 (#) | 1,805 | 1,843,356 | ||||||
5,190,544 | ||||||||
Food Products | 2.3% | ||||||||
B&G Foods, Inc., 4.625%, 06/01/21 | 1,500 | 1,501,875 | ||||||
Lamb Weston Holdings, Inc., 4.625%, 11/01/24 (#) | 2,000 | 2,072,500 | ||||||
Post Holdings, Inc., 5.000%, 08/15/26 (#) | 1,800 | 1,824,750 | ||||||
TreeHouse Foods, Inc., 4.875%, 03/15/22 | 1,500 | 1,509,375 | ||||||
6,908,500 | ||||||||
Gas Utilities | 1.1% | ||||||||
AmeriGas Partners LP, 5.625%, 05/20/24 | 1,550 | 1,650,750 | ||||||
Suburban Propane Partners LP, 5.500%, 06/01/24 | 1,800 | 1,809,000 | ||||||
3,459,750 | ||||||||
Health Care Equipment & Supplies | 1.2% | ||||||||
Hill-Rom Holdings, Inc., 5.750%, 09/01/23 (#) | 1,550 | 1,602,003 | ||||||
Hologic, Inc., 4.625%, 02/01/28 (#) | 2,000 | 2,030,000 | ||||||
3,632,003 |
The accompanying notes are an integral part of these financial statements.
50 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Health Care Providers & Services | 3.1% | ||||||||
Centene Corp.: | ||||||||
6.125%, 02/15/24 | $ | 1,500 | $ | 1,571,250 | ||||
4.750%, 01/15/25 | 500 | 516,105 | ||||||
DaVita, Inc., 5.125%, 07/15/24 | 2,000 | 2,000,600 | ||||||
Encompass Health Corp., 5.125%, 03/15/23 | 1,551 | 1,578,142 | ||||||
Molina Healthcare, Inc., 5.375%, 11/15/22 | 1,700 | 1,768,000 | ||||||
Tenet Healthcare Corp.: | ||||||||
4.750%, 06/01/20 | 700 | 707,000 | ||||||
4.375%, 10/01/21 | 1,250 | 1,268,750 | ||||||
9,409,847 | ||||||||
Hotels, Restaurants & Leisure | 9.6% | ||||||||
1011778 BC ULC, 4.625%, 01/15/22 (#) | 1,550 | 1,550,000 | ||||||
Boyd Gaming Corp.: | ||||||||
6.875%, 05/15/23 | 1,450 | 1,497,125 | ||||||
6.375%, 04/01/26 | 750 | 793,410 | ||||||
Brinker International, Inc., 5.000%, 10/01/24 (#) | 2,000 | 2,037,500 | ||||||
Cedar Fair LP, 5.375%, 04/15/27 | 1,550 | 1,608,125 | ||||||
Cinemark USA, Inc., 4.875%, 06/01/23 | 1,550 | 1,569,375 | ||||||
Diamond Resorts International, Inc., 7.750%, 09/01/23 (#) | 1,500 | 1,545,000 | ||||||
GLP Capital LP, 4.875%, 11/01/20 | 1,500 | 1,526,040 | ||||||
Golden Nugget, Inc., 6.750%, 10/15/24 (#) | 1,622 | 1,670,660 | ||||||
Hilton Worldwide Finance LLC, 4.625%, 04/01/25 | 2,015 | 2,062,856 | ||||||
International Game Technology PLC, 6.250%, 02/15/22 (#) | 1,450 | 1,531,563 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 51
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
KFC Holding Co., 5.250%, 06/01/26 (#) | $ | 2,400 | $ | 2,516,976 | ||||
MGM Resorts International: 6.625%, 12/15/21 | 1,000 | 1,080,000 | ||||||
4.625%, 09/01/26 | 800 | 804,000 | ||||||
Scientific Games International, Inc., 5.000%, 10/15/25 (#) | 1,750 | 1,767,500 | ||||||
Six Flags Entertainment Corp., 4.875%, 07/31/24 (#) | 1,850 | 1,877,750 | ||||||
Station Casinos LLC, 5.000%, 10/01/25 (#) | 1,700 | 1,704,250 | ||||||
Wynn Las Vegas LLC, 5.500%, 03/01/25 (#) | 2,000 | 2,065,600 | ||||||
29,207,730 | ||||||||
Household Durables | 0.6% | ||||||||
Tempur Sealy International, Inc., 5.625%, 10/15/23 | 1,750 | 1,802,500 | ||||||
Household Products | 1.2% | ||||||||
Energizer Holdings, Inc., 5.500%, 06/15/25 (#) | 1,750 | 1,771,875 | ||||||
Spectrum Brands, Inc., 5.750%, 07/15/25 | 1,800 | 1,869,750 | ||||||
3,641,625 | ||||||||
Independent Power & Renewable Electricity Producers | 1.7% | ||||||||
AES Corp., 5.125%, 09/01/27 | 1,700 | 1,793,500 | ||||||
Calpine Corp., 6.000%, 01/15/22 (#) | 1,500 | 1,507,500 | ||||||
NextEra Energy Operating Partners LP, 4.500%, 09/15/27 (#) | 1,750 | 1,728,125 | ||||||
5,029,125 | ||||||||
IT Services | 1.2% | ||||||||
First Data Corp.: | ||||||||
5.375%, 08/15/23 (#) | 1,600 | 1,628,800 | ||||||
5.000%, 01/15/24 (#) | 500 | 512,250 |
The accompanying notes are an integral part of these financial statements.
52 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
VeriSign, Inc., 4.625%, 05/01/23 | $ | 1,550 | $ | 1,575,265 | ||||
3,716,315 | ||||||||
Machinery | 3.0% | ||||||||
Allison Transmission, Inc., 4.750%, 10/01/27 (#) | 1,795 | 1,781,537 | ||||||
Meritor, Inc., 6.250%, 02/15/24 | 1,700 | 1,751,000 | ||||||
Mueller Water Products, Inc., 5.500%, 06/15/26 (#) | 1,750 | 1,806,875 | ||||||
SPX FLOW, Inc., 5.625%, 08/15/24 (#) | 1,750 | 1,824,375 | ||||||
Terex Corp., 5.625%, 02/01/25 (#) | 1,790 | 1,812,375 | ||||||
8,976,162 | ||||||||
Media | 12.1% | ||||||||
AMC Networks, Inc., 4.750%, 12/15/22 | 1,500 | 1,518,840 | ||||||
CCO Holdings LLC: 5.250%, 03/15/21 | 1,650 | 1,657,219 | ||||||
5.125%, 05/01/27 (#) | 500 | 517,680 | ||||||
Clear Channel Worldwide Holdings, Inc., 6.500%, 11/15/22 | 1,500 | 1,526,250 | ||||||
CSC Holdings LLC: 5.500%, 05/15/26 (#) | 1,000 | 1,048,700 | ||||||
7.500%, 04/01/28 (#) | 1,690 | 1,855,282 | ||||||
DISH DBS Corp., 5.125%, 05/01/20 | 1,600 | 1,607,984 | ||||||
Entercom Media Corp., 7.250%, 11/01/24 (#) | 1,500 | 1,580,625 | ||||||
Lamar Media Corp., 5.750%, 02/01/26 | 1,726 | 1,814,457 | ||||||
Mediacom Broadband LLC, 5.500%, 04/15/21 | 375 | 373,125 | ||||||
Meredith Corp., 6.875%, 02/01/26 | 1,700 | 1,803,921 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 53
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Nexstar Broadcasting Inc., 5.875%, 11/15/22 | $ | 1,500 | $ | 1,533,750 | ||||
Outfront Media Capital LLC, 5.250%, 02/15/22 | 1,500 | 1,520,100 | ||||||
Sinclair Television Group, Inc., 5.375%, 04/01/21 | 1,650 | 1,651,031 | ||||||
Sirius XM Radio, Inc.: 5.375%, 04/15/25 (#) | 400 | 412,500 | ||||||
5.000%, 08/01/27 (#) | 1,750 | 1,780,450 | ||||||
TEGNA, Inc., 6.375%, 10/15/23 | 1,650 | 1,699,500 | ||||||
The EW Scripps Co., 5.125%, 05/15/25 (#) | 1,800 | 1,728,000 | ||||||
Tribune Media Co., 5.875%, 07/15/22 | 1,550 | 1,576,970 | ||||||
Unitymedia Hessen GmbH & Co. KG, 5.000%, 01/15/25 (#) | 1,700 | 1,751,000 | ||||||
Univision Communications, Inc., 5.125%, 02/15/25 (#) | 2,000 | 1,902,500 | ||||||
Videotron, Ltd.: 5.000%, 07/15/22 | 1,558 | 1,632,005 | ||||||
5.125%, 04/15/27 (#) | 500 | 521,875 | ||||||
Virgin Media Secured Finance PLC, 5.250%, 01/15/26 (#) | 2,100 | 2,151,891 | ||||||
WMG Acquisition Corp., 4.875%, 11/01/24 (#) | 1,600 | 1,638,000 | ||||||
36,803,655 | ||||||||
Metals & Mining | 2.6% | ||||||||
Alcoa Nederland Holding BV, 6.750%, 09/30/24 (#) | 1,800 | 1,901,250 | ||||||
Anglo American Capital PLC, 4.875%, 05/14/25 (#) | 1,650 | 1,776,972 | ||||||
Freeport-McMoRan, Inc., 4.550%, 11/14/24 | 2,200 | 2,248,950 |
The accompanying notes are an integral part of these financial statements.
54 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Steel Dynamics, Inc.: | ||||||||
4.125%, 09/15/25 | $ | 500 | $ | 497,500 | ||||
5.000%, 12/15/26 | 1,550 | 1,615,875 | ||||||
8,040,547 | ||||||||
Oil, Gas & Consumable Fuels | 9.3% | ||||||||
Antero Resources Corp., 5.125%, 12/01/22 | 1,600 | 1,536,000 | ||||||
Cheniere Energy Partners LP, 5.250%, 10/01/25 | 1,250 | 1,292,188 | ||||||
Diamondback Energy, Inc., 4.750%, 11/01/24 | 1,550 | 1,590,687 | ||||||
Energy Transfer Operating LP: | ||||||||
7.500%, 10/15/20 | 1,250 | 1,325,737 | ||||||
5.875%, 01/15/24 | 750 | 833,534 | ||||||
Gulfport Energy Corp., 6.000%, 10/15/24 | 1,700 | 1,313,250 | ||||||
Holly Energy Partners LP, 6.000%, 08/01/24 (#) | 2,040 | 2,121,600 | ||||||
Murphy Oil Corp., 6.875%, 08/15/24 | 1,500 | 1,575,000 | ||||||
Newfield Exploration Co., 5.625%, 07/01/24 | 1,600 | 1,770,625 | ||||||
Parsley Energy LLC, 5.625%, 10/15/27 (#) | 1,700 | 1,776,500 | ||||||
PBF Holding Co. LLC, 7.000%, 11/15/23 | 1,400 | 1,452,514 | ||||||
Range Resources Corp., 5.000%, 08/15/22 | 1,700 | 1,619,250 | ||||||
Southwestern Energy Co., 6.200%, 01/23/25 | 1,800 | 1,647,000 | ||||||
Sunoco LP, 5.500%, 02/15/26 | 1,700 | 1,770,125 | ||||||
Tallgrass Energy Partners LP, 5.500%, 01/15/28 (#) | 1,250 | 1,264,063 | ||||||
Targa Resources Partners LP, 5.250%, 05/01/23 | 1,550 | 1,571,467 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 55
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Whiting Petroleum Corp.: 5.750%, 03/15/21 | $ | 900 | $ | 897,750 | ||||
6.625%, 01/15/26 | 1,000 | 964,375 | ||||||
WPX Energy, Inc.: 6.000%, 01/15/22 | 900 | 932,625 | ||||||
5.750%, 06/01/26 | 1,000 | 1,035,000 | ||||||
28,289,290 | ||||||||
Personal Products | 0.5% | ||||||||
First Quality Finance Co., Inc., 4.625%, 05/15/21 (#) | 1,500 | 1,498,125 | ||||||
Pharmaceuticals | 0.5% | ||||||||
Mallinckrodt International Finance SA, 5.750%, 08/01/22 (#) | 1,700 | 1,453,500 | ||||||
Professional Services | 1.0% | ||||||||
IHS Markit, Ltd., 5.000%, 11/01/22 (#) | 1,500 | 1,589,250 | ||||||
Nielsen Finance LLC, 5.000%, 04/15/22 (#) | 1,550 | 1,548,063 | ||||||
3,137,313 | ||||||||
Road & Rail | 0.6% | ||||||||
The Hertz Corp., 5.500%, 10/15/24 (#) | 1,800 | 1,719,540 | ||||||
Semiconductors & Semiconductor Equipment | 0.3% | ||||||||
Qorvo, Inc., 5.500%, 07/15/26 | 1,000 | 1,058,300 | ||||||
Software | 1.3% | ||||||||
j2 Cloud Services LLC, 6.000%, 07/15/25 (#) | 1,550 | 1,623,625 | ||||||
Nuance Communications, Inc., 5.625%, 12/15/26 | 1,500 | 1,564,200 | ||||||
Rackspace Hosting, Inc., 8.625%, 11/15/24 (#) | 1,000 | 917,500 | ||||||
4,105,325 |
The accompanying notes are an integral part of these financial statements.
56 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (continued) | ||||||||
Specialty Retail | 1.2% | ||||||||
Group 1 Automotive, Inc., 5.000%, 06/01/22 | $ | 1,662 | $ | 1,682,775 | ||||
Penske Automotive Group, Inc., 5.500%, 05/15/26 | 1,800 | 1,876,500 | ||||||
3,559,275 | ||||||||
Technology Hardware, Storage & Peripherals | 2.3% | ||||||||
Dell International LLC, 7.125%, 06/15/24 (#) | 1,525 | 1,609,980 | ||||||
NCR Corp., 4.625%, 02/15/21 | 1,568 | 1,571,920 | ||||||
Seagate HDD Cayman, 4.750%, 01/01/25 | 1,900 | 1,913,978 | ||||||
Western Digital Corp., 4.750%, 02/15/26 | 2,000 | 1,962,100 | ||||||
7,057,978 | ||||||||
Textiles, Apparel & Luxury Goods | 0.6% | ||||||||
Hanesbrands, Inc., 4.625%, 05/15/24 (#) | 1,750 | 1,816,850 | ||||||
Trading Companies & Distributors | 2.0% | ||||||||
Avis Budget Car Rental LLC, 5.750%, 07/15/27 (#) | 1,000 | 1,007,500 | ||||||
HD Supply, Inc., 5.375%, 10/15/26 (#) | 1,700 | 1,793,500 | ||||||
Herc Holdings, Inc., 5.500%, 07/15/27 (#) | 500 | 503,125 | ||||||
United Rentals North America, Inc., 4.625%, 07/15/23 | 1,100 | 1,122,825 | ||||||
WESCO Distribution, Inc., 5.375%, 12/15/21 | 1,600 | 1,612,000 | ||||||
6,038,950 | ||||||||
Wireless Telecommunication Services | 1.5% | ||||||||
Inmarsat Finance PLC, 4.875%, 05/15/22 (#) | 1,750 | 1,760,937 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 57
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Corporate Income Portfolio (concluded) | ||||||||
Sprint Corp., 7.125%, 06/15/24 | $ | 500 | $ | 530,150 | ||||
T-Mobile USA, Inc., 6.500%, 01/15/26 | 2,000 | 2,162,120 | ||||||
4,453,207 | ||||||||
Total Corporate Bonds (Cost $278,846,099) | 281,302,064 | |||||||
Description | Shares | Fair Value | ||||||
Exchange-Traded Funds | 2.7% | ||||||||
Invesco Fundamental High Yield Corporate Bond ETF (Cost $8,019,531) | 424,383 | $ | 8,042,058 | |||||
Short-Term Investments | 0.8% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $2,476,235) | 2,476,235 | 2,476,235 | ||||||
Total Investments | 96.2% (Cost $289,341,865) | $ | 291,820,357 | ||||||
Cash and Other Assets in Excess of Liabilities | 3.8% | 11,546,585 | |||||||
Net Assets | 100.0% | $ | 303,366,942 |
The accompanying notes are an integral part of these financial statements.
58 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 59
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Short Duration Fixed Income Portfolio (continued) | ||||||||
Electronic Equipment, Instruments & Components | 1.1% | ||||||||
Amphenol Corp., 2.200%, 04/01/20 | $ | 1,115 | $ | 1,112,599 | ||||
Food & Staples Retailing | 2.0% | ||||||||
The Kroger Co., 6.150%, 01/15/20 | 1,989 | 2,027,154 | ||||||
Internet & Direct Marketing Retail | 1.2% | ||||||||
eBay, Inc., 3.250%, 10/15/20 | 1,129 | 1,138,801 | ||||||
IT Services | 2.5% | ||||||||
Fiserv, Inc., 2.700%, 06/01/20 | 2,510 | 2,514,945 | ||||||
Life Sciences Tools & Services | 1.6% | ||||||||
Thermo Fisher Scientific, Inc., 4.500%, 03/01/21 | 1,500 | 1,552,368 | ||||||
Oil, Gas & Consumable Fuels | 2.6% | ||||||||
Enterprise Products Operating LLC, 2.550%, 10/15/19 | 2,525 | 2,524,194 | ||||||
Total Corporate Bonds (Cost $34,769,090) | 34,879,901 | |||||||
US Government Securities | 9.0% | ||||||||
Mortgage-Backed Securities | 9.0% | ||||||||
Federal Home Loan Mortgage Corp.: | ||||||||
Pool# 848138, 4.794%, 07/01/38 (§) | 489 | 516,715 | ||||||
Pool# 848514, 4.874%, 03/01/32 (§) | 1,052 | 1,107,272 | ||||||
Pool# 848517, 4.629%, 12/01/34 (§) | 628 | 661,936 | ||||||
Pool# 849414, 4.656%, 07/01/35 (§) | 796 | 839,183 | ||||||
Pool# G13867, 5.000%, 06/01/25 | 178 | 183,908 |
The accompanying notes are an integral part of these financial statements.
60 Semi-Annual Report
Description | Principal Amount (000) | Fair Value | ||||||
Lazard US Short Duration Fixed Income Portfolio (continued) | ||||||||
Federal National Mortgage Association: | ||||||||
Pool# 725296, 4.703%, 03/01/34 (§) | $ | 394 | $ | 412,844 | ||||
Pool# 995609, 4.657%, 04/01/35 (§) | 430 | 451,836 | ||||||
Pool# AD0701, 4.432%, 02/01/37 (§) | 499 | 520,429 | ||||||
Pool# AE0149, 4.749%, 12/01/36 (§) | 437 | 460,605 | ||||||
Pool# AE0315, 4.500%, 02/01/21 | 3 | 2,757 | ||||||
Pool# AL0345, 4.624%, 11/01/35 (§) | 329 | 346,280 | ||||||
Pool# AL3739, 4.595%, 07/01/38 (§) | 128 | 134,545 | ||||||
Pool# AL3746, 4.656%, 01/01/37 (§) | 497 | 524,256 | ||||||
Pool# AL3941, 6.000%, 03/01/24 | 97 | 99,941 | ||||||
Pool# AL4118, 4.558%, 05/01/35 (§) | 275 | 287,560 | ||||||
Pool# AL4545, 4.640%, 05/01/39 (§) | 336 | 353,650 | ||||||
Pool# AL4660, 4.626%, 11/01/41 (§) | 371 | 389,737 | ||||||
Pool# AL5574, 4.627%, 12/01/40 (§) | 723 | 761,514 | ||||||
Pool# AL5642, 4.634%, 05/01/39 (§) | 851 | 898,544 | ||||||
Total US Government Securities (Cost $8,947,576) | 8,953,512 | |||||||
US Treasury Securities | 47.1% | ||||||||
US Treasury Notes: 1.625%, 07/31/20 | 22,925 | 22,846,195 | ||||||
1.375%, 08/31/20 | 24,040 | 23,888,811 | ||||||
Total US Treasury Securities (Cost $46,496,772) | 46,735,006 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 61
Description | Shares | Fair Value | ||||||
Lazard US Short Duration Fixed Income Portfolio (concluded) | ||||||||
Short-Term Investments | 0.6% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $551,254) | 551,254 | $ | 551,254 | |||||
Total Investments | 99.3% (Cost $98,139,453) | $ | 98,551,664 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.7% | 726,725 | |||||||
Net Assets | 100.0% | $ | 99,278,389 |
The accompanying notes are an integral part of these financial statements.
62 Semi-Annual Report
The Lazard Funds, Inc.Notes to Portfolios of Investments
June 30, 2019 (unaudited)
(#) | Pursuant to Rule 144A under the Securities Act of 1933, these securities may only be traded among “qualified institutional buyers.” At June 30, 2019, the percentage of net assets for each Portfolio was as follows: |
Portfolio | Percentage of Net Assets | ||||
Emerging Markets Debt | 8.3 | % | |||
Global Fixed Income | 2.1 | ||||
US Corporate Income | 42.7 |
(§) | Variable and floating rate securities are securities for which interest rate changes are based on changes in a designated base rate. The rates shown are those in effect on June 30, 2019. |
(Ø) | Step up bonds are securities which increase the interest payment rate at a specified point in time. Rate shown reflects rate in effect at June 30, 2019 which may step up at a future date. |
(«) | Issue in default. |
(») | The Portfolio, at all times, maintains portfolio securities in sufficient amount to cover its obligations related to investments in forward currency contracts. |
Security Abbreviations:
BBSW | — | Bank Bill Swap Reference Rate |
LIBOR | — | London Interbank Offered Rate |
NTN- B | — | Brazil Sovereign “Nota do Tesouro Nacional” Series B |
NTN- F | — | Brazil Sovereign “Nota do Tesouro Nacional” Series F |
PRIBOR | — | Prague Interbank Offered Rate |
Currency Abbreviations: | |||||
ARS | — | Argentine Peso | MYR | — | Malaysian Ringgit |
AUD | — | Australian Dollar | NOK | — | Norwegian Krone |
BRL | — | Brazilian Real | NZD | — | New Zealand Dollar |
CAD | — | Canadian Dollar | PEN | — | Peruvian Nuevo Sol |
CHF | — | Swiss Franc | PHP | — | Philippine Peso |
CLP | — | Chilean Peso | PLN | — | Polish Zloty |
COP | — | Colombian Peso | RON | — | New Romanian Leu |
CZK | — | Czech Koruna | RUB | — | Russian Ruble |
DOP | — | Dominican Republic Peso | SEK | — | Swedish Krona |
EUR | — | Euro | SGD | — | Singapore Dollar |
GBP | — | British Pound Sterling | THB | — | Thai Baht |
HUF | — | Hungarian Forint | TRY | — | New Turkish Lira |
IDR | — | Indonesian Rupiah | TWD | — | Taiwan Dollar |
INR | — | Indian Rupee | UAH | — | Ukrainian hryvnia |
JPY | — | Japanese Yen | USD | — | United States Dollar |
KRW | — | South Korean Won | UYU | — | Uruguayan Peso |
MXN | — | Mexican New Peso | ZAR | — | South African Rand |
Counterparty Abbreviations: | |||||
BOA | — | Bank of America NA | JPM | — | JPMorgan Chase Bank NA |
BRC | — | Barclays Bank PLC | MSC | — | Morgan Stanley & Co. |
CIT | — | Citibank NA | SCB | — | Standard Chartered Bank |
GSC | — | Goldman Sachs International | UBS | — | UBS AG |
HSB | — | HSBC Bank USA NA |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 63
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country:
Industry† | Lazard Emerging Markets Debt Portfolio | Lazard Global Fixed Income Portfolio | ||||||
Corporate & Quasi Government Bonds | ||||||||
Automobiles | — | % | 0.9 | % | ||||
Banks | 0.7 | 4.9 | ||||||
Beverages | — | 1.1 | ||||||
Capital Markets | — | 2.1 | ||||||
Communication Equipment | 0.1 | — | ||||||
Consumer Finance | — | 1.0 | ||||||
Containers & Packaging | — | 1.1 | ||||||
Diversified Consumer Services | — | 0.4 | ||||||
Diversified Financial Services | — | 2.5 | ||||||
Diversified Telecommunication Services | 0.1 | 2.1 | ||||||
Electrical Equipment | — | 1.1 | ||||||
Electric utilities | 1.4 | — | ||||||
Food Products | — | 0.6 | ||||||
Health Care Providers & Services | — | 1.7 | ||||||
Hotels, Restaurants & Leisure | — | 2.1 | ||||||
Independent Power and Renewable Electricity Producers | 0.2 | — | ||||||
Machinery | — | 1.0 | ||||||
Metal and Mining | 0.5 | — | ||||||
Oil, Gas & Consumable Fuels | 1.9 | — | ||||||
Personal Products | — | 1.7 | ||||||
Pharmaceuticals | — | 1.1 | ||||||
Software | — | 1.8 | ||||||
Technology Hardware, Storage & Peripherals | — | 1.9 | ||||||
Textiles, Apparel & Luxury Goods | — | 1.5 | ||||||
Thrifts & Mortgage Finance | 0.2 | — | ||||||
Trading Companies & Distributors | — | 0.6 | ||||||
Wireless Telecommunication Services | 0.3 | 0.5 | ||||||
Subtotal | 5.4 | 31.7 | ||||||
Foreign Government Obligations | 90.0 | 45.2 | ||||||
Supranational Bonds | 1.3 | 12.4 | ||||||
US Municipal Bonds | — | 2.0 | ||||||
US Treasury Securities | — | 7.8 | ||||||
Short-Term Investments | 2.3 | 0.4 | ||||||
Total Investments | 99.0 | % | 99.5 | % |
† | Industry classifications may be different than those used for compliance monitoring purposes. |
The accompanying notes are an integral part of these financial statements.
64 Semi-Annual Report
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Semi-Annual Report 65
The Lazard Funds, Inc.Statements of Assets and Liabilities (unaudited)
June 30, 2019 | Lazard Emerging Markets Debt Portfolio | Lazard Global Fixed Income Portfolio | |||||||
ASSETS | |||||||||
Investments in securities, at fair value | $ | 172,934,928 | $ | 6,175,323 | |||||
Cash | 199,523 | 4,501 | |||||||
Cash collateral due from broker on swap agreements | 126,621 | — | |||||||
Foreign currency, at fair value | 304,234 | 10 | |||||||
Receivables for: | |||||||||
Capital stock sold | 39,858 | — | |||||||
Dividends and interest | 2,815,958 | 59,583 | |||||||
Investments sold | 234,525 | — | |||||||
Amount due from Investment Manager (Note 3) | — | 10,500 | |||||||
Receivable from broker – variation margin on centrally cleared swaps | 4,454 | — | |||||||
Gross unrealized appreciation on: | |||||||||
Forward currency contracts | 806,316 | 27,001 | |||||||
Swap agreements | 81,488 | — | |||||||
Prepaid expenses | — | 9,990 | |||||||
Total assets | 177,547,905 | 6,286,908 | |||||||
LIABILITIES | |||||||||
Cash collateral due to broker on forward currency contracts | 60,000 | — | |||||||
Payables for: | |||||||||
Management fees | 95,841 | — | |||||||
Accrued professional services | 38,648 | 27,515 | |||||||
Accrued custodian fees | 35,402 | 5,009 | |||||||
Accrued distribution fees | 136 | — | |||||||
Investments purchased | 1,979,933 | — | |||||||
Capital stock redeemed | 54,076 | 21 | |||||||
Dividends | 2,499 | — | |||||||
Gross unrealized depreciation on forward currency contracts | 529,911 | 40,052 | |||||||
Other accrued expenses and payables | 51,123 | 7,126 | |||||||
Total liabilities | 2,847,569 | 79,723 | |||||||
Net assets | $ | 174,700,336 | $ | 6,207,185 | |||||
NET ASSETS | |||||||||
Paid in capital | $ | 219,488,532 | $ | 6,224,641 | |||||
Distributable earnings (Accumulated loss) | (44,788,196 | ) | (17,456 | ) | |||||
Net assets | $ | 174,700,336 | $ | 6,207,185 |
The accompanying notes are an integral part of these financial statements.
66 Semi-Annual Report
Lazard US Corporate Income Portfolio | Lazard US Short Duration Fixed Income Portfolio | ||||||||
$ | 291,820,357 | $ | 98,551,664 | ||||||
— | — | ||||||||
— | — | ||||||||
— | — | ||||||||
9,639,841 | — | ||||||||
3,851,946 | 813,080 | ||||||||
1,998,898 | — | ||||||||
— | — | ||||||||
— | — | ||||||||
— | — | ||||||||
— | — | ||||||||
— | 26,166 | ||||||||
307,311,042 | 99,390,910 | ||||||||
— | — | ||||||||
105,541 | 17,457 | ||||||||
30,845 | 29,116 | ||||||||
21,029 | 7,577 | ||||||||
774 | 4 | ||||||||
3,115,000 | — | ||||||||
626,450 | 37,521 | ||||||||
31,014 | 11,045 | ||||||||
— | — | ||||||||
13,447 | 9,801 | ||||||||
3,944,100 | 112,521 | ||||||||
$ | 303,366,942 | $ | 99,278,389 | ||||||
$ | 307,718,089 | $ | 100,495,416 | ||||||
(4,351,147 | ) | (1,217,027 | ) | ||||||
$ | 303,366,942 | $ | 99,278,389 |
Semi-Annual Report 67
June 30, 2019 | Lazard Emerging Markets Debt Portfolio | Lazard Global Fixed Income Portfolio | |||||||
Institutional Shares | |||||||||
Net assets | $ | 107,645,458 | $ | 6,166,833 | |||||
Shares of capital stock outstanding* | 13,537,890 | 681,144 | |||||||
Net asset value, offering and redemption price per share | $ | 7.95 | $ | 9.05 | |||||
Open Shares | |||||||||
Net assets | $ | 673,970 | $ | 40,352 | |||||
Shares of capital stock outstanding* | 83,938 | 4,456 | |||||||
Net asset value, offering and redemption price per share | $ | 8.03 | $ | 9.05 | † | ||||
R6 Shares | |||||||||
Net assets | $ | 66,380,908 | — | ||||||
Shares of capital stock outstanding* | 7,801,170 | — | |||||||
Net asset value, offering and redemption price per share* | $ | 8.51 | — | ||||||
Cost of investments in securities | $ | 168,795,363 | $ | 6,047,910 | |||||
Cost of foreign currency | $ | 296,731 | $ | 10 | |||||
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
† | Shares values are rounded for presentation purposes. |
The accompanying notes are an integral part of these financial statements.
68 Semi-Annual Report
Lazard US Corporate Income Portfolio | Lazard US Short Duration Fixed Income Portfolio | ||||||||
$ | 299,741,058 | $ | 99,263,080 | ||||||
61,699,619 | 10,164,590 | ||||||||
$ | 4.86 | $ | 9.77 | ||||||
$ | 3,624,774 | $ | 15,309 | ||||||
742,633 | 1,567 | ||||||||
$ | 4.88 | $ | 9.77 | ||||||
$ | 1,110 | — | |||||||
228 | — | ||||||||
$ | 4.87 | — | |||||||
$ | 289,341,865 | $ | 98,139,453 | ||||||
$ | — | $ | — |
Semi-Annual Report 69
The Lazard Funds, Inc.Statements of Operations (unaudited)
Lazard | Lazard | |||||||||
Emerging Markets | Global Fixed | |||||||||
For the Six Months Ended June 30, 2019 | Debt Portfolio | Income Portfolio | ||||||||
Investment Income (Loss) | ||||||||||
Income | ||||||||||
Interest * | $ | 6,104,385 | $ | 85,202 | ||||||
Dividends | — | — | ||||||||
Total investment income | 6,104,385 | 85,202 | ||||||||
Expenses | ||||||||||
Management fees (Note 3) | 739,703 | 14,306 | ||||||||
Custodian fees | 113,471 | 22,439 | ||||||||
Professional services | 33,351 | 21,117 | ||||||||
Administration fees | 21,179 | 7,721 | ||||||||
Registration fees | 21,021 | 22,877 | ||||||||
Shareholders’ services | 6,518 | 2,778 | ||||||||
Directors’ fees and expenses | 8,031 | 2,610 | ||||||||
Shareholders’ reports | 7,184 | 2,650 | ||||||||
Distribution fees (Open Shares) | 841 | 45 | ||||||||
Other^ | 30,555 | 2,701 | ||||||||
Total gross expenses | 981,854 | 99,244 | ||||||||
Management fees waived and expenses reimbursed | (37,385 | ) | (79,155 | ) | ||||||
Total net expenses | 944,469 | 20,089 | ||||||||
Net investment income (loss) | 5,159,916 | 65,113 | ||||||||
Net Realized and Unrealized Gain (Loss) on Investments, Foreign Currency Transactions, Forward Currency Contracts and Swap Agreements | ||||||||||
Net realized gain (loss) on: | ||||||||||
Investments** | (4,743,673 | ) | (34,712 | ) | ||||||
Foreign currency transactions | 60,691 | (2,219 | ) | |||||||
Forward currency contracts | 100,729 | 4,381 | ||||||||
Swap agreements | 189 | — | ||||||||
Total net realized gain (loss) on investments, foreign currency transactions, forward currency contracts and swap agreements | (4,582,064 | ) | (32,550 | ) | ||||||
Net change in unrealized appreciation (depreciation) on: | ||||||||||
Investments† | 22,163,534 | 348,593 | ||||||||
Foreign currency translations | 22,486 | 1,083 | ||||||||
Forward currency contracts | (430,911 | ) | (45,154 | ) | ||||||
Swap agreements | 223,622 | — | ||||||||
Total net change in unrealized appreciation (depreciation) on investments, foreign currency translations, forward currency contracts and swap agreements | 21,978,731 | 304,522 | ||||||||
Net realized and unrealized gain (loss) on investments, foreign currency transactions, forward currency contracts and swap agreements | 17,396,667 | 271,972 | ||||||||
Net increase (decrease) in net assets resulting from operations | $ | 22,556,583 | $ | 337,085 | ||||||
* | Net of foreign withholding taxes of | $ | 28,258 | $ | 615 | |||||
** | Net of foreign capital gains taxes of | $ | 6,442 | $ | — | |||||
† | Includes net change in unrealized appreciation (depreciation) of foreign capital gains taxes of | $ | (55,249 | ) | $ | — | ||||
^ | Includes interest on line of credit of | $ | 24,034 | $ | — |
The accompanying notes are an integral part of these financial statements.
70 Semi-Annual Report
Lazard US Corporate Income Portfolio | Lazard US Short Duration Fixed Income Portfolio | ||||||||
$ | 7,663,581 | $ | 1,469,239 | ||||||
87,055 | — | ||||||||
7,750,636 | 1,469,239 | ||||||||
810,721 | 133,864 | ||||||||
55,746 | 22,618 | ||||||||
27,708 | 23,963 | ||||||||
27,276 | 14,056 | ||||||||
21,696 | 19,041 | ||||||||
11,457 | 3,392 | ||||||||
9,950 | 5,224 | ||||||||
6,203 | 2,731 | ||||||||
4,652 | 30 | ||||||||
7,825 | 4,281 | ||||||||
983,234 | 229,200 | ||||||||
(166,019 | ) | (14,695 | ) | ||||||
817,215 | 214,505 | ||||||||
6,933,421 | 1,254,734 | ||||||||
(432,352 | ) | 39,041 | |||||||
— | — | ||||||||
— | — | ||||||||
— | — | ||||||||
(432,352 | ) | 39,041 | |||||||
20,751,831 | 640,800 | ||||||||
— | — | ||||||||
— | — | ||||||||
— | — | ||||||||
20,751,831 | 640,800 | ||||||||
20,319,479 | 679,841 | ||||||||
$ | 27,252,900 | $ | 1,934,575 | ||||||
$ | — | $ | — | ||||||
$ | — | $ | — | ||||||
$ | — | $ | — | ||||||
$ | 134 | $ | — |
Semi-Annual Report 71
The Lazard Funds, Inc.Statements of Changes in Net Assets
Lazard Emerging Markets Debt Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 5,159,916 | $ | 14,539,447 | ||||
Net realized gain (loss) on investments, foreign currency transactions, forward currency contracts and swap agreements | (4,582,064 | ) | (11,020,379 | ) | ||||
Net change in unrealized appreciation (depreciation) on investments, foreign currency translations, forward currency contracts and swap agreements | 21,978,731 | (21,451,917 | ) | |||||
Net increase (decrease) in net assets resulting from operations | 22,556,583 | (17,932,849 | ) | |||||
Distributions to shareholders (Note 2(f)) | ||||||||
Institutional Shares | (3,334,142 | ) | (4,701,379 | ) | ||||
Open Shares | (17,050 | ) | (68,347 | ) | ||||
R6 Shares | (1,873,694 | ) | (2,107,177 | ) | ||||
Return of capital | ||||||||
Institutional Shares | — | (5,201,496 | ) | |||||
Open Shares | — | (75,617 | ) | |||||
R6 Shares | — | (2,331,332 | ) | |||||
Net decrease in net assets resulting from distributions | (5,224,886 | ) | (14,485,348 | ) | ||||
Capital stock transactions | ||||||||
Net proceeds from sales Institutional Shares | 3,543,109 | 53,729,663 | ||||||
Open Shares | 18,039 | 2,519,684 | ||||||
R6 Shares | 3,000,000 | 110,381,409 | ||||||
Net proceeds from reinvestment of distributions | ||||||||
Institutional Shares | 3,299,608 | 9,761,506 | ||||||
Open Shares | 15,709 | 142,468 | ||||||
R6 Shares | 1,664,669 | 4,438,509 | ||||||
Cost of shares redeemed | ||||||||
Institutional Shares | (52,226,407 | ) | (183,928,083 | ) | ||||
Open Shares | (82,201 | ) | (8,319,029 | ) | ||||
R6 Shares | (45,500,729 | ) | — | |||||
Net increase (decrease) in net assets from capital stock transactions | (86,268,203 | ) | (11,273,873 | ) | ||||
Total increase (decrease) in net assets | (68,936,506 | ) | (43,692,070 | ) | ||||
Net assets at beginning of period | 243,636,842 | 287,328,912 | ||||||
Net assets at end of period | $ | 174,700,336 | $ | 243,636,842 |
The accompanying notes are an integral part of these financial statements.
72 Semi-Annual Report
Lazard Global Fixed Income Portfolio | Lazard Lazard US Corporate Income Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
$ | 65,113 | $ | 127,326 | $ | 6,933,421 | $ | 16,087,868 | |||||||||
(32,550 | ) | (81,191 | ) | (432,352 | ) | 588,674 | ||||||||||
304,522 | (188,780 | ) | 20,751,831 | (25,354,375 | ) | |||||||||||
337,085 | (142,645 | ) | 27,252,900 | (8,677,833 | ) | |||||||||||
(64,592 | ) | (59,363 | ) | (6,836,790 | ) | (15,821,900 | ) | |||||||||
(364 | ) | (319 | ) | (81,804 | ) | (253,454 | ) | |||||||||
— | — | (25 | ) | (13,162 | ) | |||||||||||
— | (67,280 | ) | — | — | ||||||||||||
— | (362 | ) | — | — | ||||||||||||
— | — | — | — | |||||||||||||
(64,956 | ) | (127,324 | ) | (6,918,619 | ) | (16,088,516 | ) | |||||||||
951,330 | 2,654,185 | 31,532,965 | 49,765,025 | |||||||||||||
9,792 | — | 175,194 | 2,569,673 | |||||||||||||
— | — | — | 24,665 | |||||||||||||
64,590 | 126,631 | 6,651,342 | 14,673,547 | |||||||||||||
363 | 681 | 58,972 | 120,865 | |||||||||||||
— | — | 25 | 6,762 | |||||||||||||
(614,727 | ) | (1,722,437 | ) | (66,793,003 | ) | (76,329,156 | ) | |||||||||
(4,365 | ) | (9 | ) | (1,192,629 | ) | (3,681,834 | ) | |||||||||
— | — | — | (1,782,867 | ) | ||||||||||||
406,983 | 1,059,051 | (29,567,134 | ) | (14,633,320 | ) | |||||||||||
679,112 | 789,082 | (9,232,853 | ) | (39,399,669 | ) | |||||||||||
5,528,073 | 4,738,991 | 312,599,795 | 351,999,464 | |||||||||||||
$ | 6,207,185 | $ | 5,528,073 | $ | 303,366,942 | $ | 312,599,795 |
Semi-Annual Report 73
Lazard Emerging Markets Debt Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 19,428,100 | 33,323,876 | ||||||
Shares sold | 459,068 | 6,920,539 | ||||||
Shares issued to shareholders from reinvestment of distributions | 426,774 | 1,230,443 | ||||||
Shares redeemed | (6,776,052 | ) | (22,046,758 | ) | ||||
Net increase (decrease) | (5,890,210 | ) | (13,895,776 | ) | ||||
Shares outstanding at end of period | 13,537,890 | 19,428,100 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 90,147 | 766,577 | ||||||
Shares sold | 2,329 | 298,747 | ||||||
Shares issued to shareholders from reinvestment of distributions | 2,013 | 17,024 | ||||||
Shares redeemed | (10,551 | ) | (992,201 | ) | ||||
Net increase (decrease) | (6,209 | ) | (676,430 | ) | ||||
Shares outstanding at end of period | 83,938 | 90,147 | ||||||
R6 Shares | ||||||||
Shares outstanding at beginning of period | 12,683,587 | 125 | ||||||
Shares sold | 380,227 | 12,137,545 | ||||||
Shares issued to shareholders from reinvestment of distributions | 201,235 | 545,917 | ||||||
Shares redeemed | (5,463,879 | ) | — | |||||
Net increase (decrease) | (4,882,417 | ) | 12,683,462 | |||||
Shares outstanding at end of period | 7,801,170 | 12,683,587 |
The accompanying notes are an integral part of these financial statements.
74 Semi-Annual Report
Lazard Global Fixed Income Portfolio | Lazard Lazard US Corporate Income Portfolio | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
635,449 | 520,489 | 67,838,982 | 70,514,409 | |||||||||||||
108,711 | 294,722 | 6,607,517 | 10,487,599 | |||||||||||||
7,325 | 14,452 | 1,389,070 | 3,108,656 | |||||||||||||
(70,341 | ) | (194,214 | ) | (14,135,950 | ) | (16,271,682 | ) | |||||||||
45,695 | 114,960 | (6,139,363 | ) | (2,675,427 | ) | |||||||||||
681,144 | 635,449 | 61,699,619 | 67,838,982 | |||||||||||||
3,789 | 3,712 | 944,746 | 1,162,735 | |||||||||||||
1,126 | — | 36,649 | 539,630 | |||||||||||||
41 | 78 | 12,257 | 25,492 | |||||||||||||
(500 | ) | (1 | ) | (251,019 | ) | (783,111 | ) | |||||||||
667 | 77 | (202,113 | ) | (217,989 | ) | |||||||||||
4,456 | 3,789 | 742,633 | 944,746 | |||||||||||||
— | — | 223 | 364,469 | |||||||||||||
— | — | — | 5,023 | |||||||||||||
— | — | 5 | 1,389 | |||||||||||||
— | — | — | (370,658 | ) | ||||||||||||
— | — | 5 | (364,246 | ) | ||||||||||||
— | — | 228 | 223 |
Semi-Annual Report 75
Lazard US Short Duration Fixed Income Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Increase (Decrease) in Net Assets | ||||||||
Operations | ||||||||
Net investment income (loss) | $ | 1,254,734 | $ | 2,205,642 | ||||
Net realized gain (loss) on investments | 39,041 | (1,149,097 | ) | |||||
Net change in unrealized appreciation (depreciation) on investments | 640,800 | 237,332 | ||||||
Net increase (decrease) in net assets resulting from operations | 1,934,575 | 1,293,877 | ||||||
Distributions to shareholders (Note 2(f)) | ||||||||
Institutional Shares | (1,255,002 | ) | (1,976,743 | ) | ||||
Open Shares | (247 | ) | (464 | ) | ||||
Return of capital | ||||||||
Institutional Shares | — | (228,383 | ) | |||||
Open Shares | — | (54 | ) | |||||
Net decrease in net assets resulting from distributions | (1,255,249 | ) | (2,205,644 | ) | ||||
Capital stock transactions | ||||||||
Net proceeds from sales Institutional Shares | 4,861,022 | 40,433,005 | ||||||
Open Shares | — | 47,508 | ||||||
Net proceeds from reinvestment of distributions Institutional Shares | 1,188,654 | 2,000,809 | ||||||
Open Shares | 247 | 514 | ||||||
Cost of shares redeemed Institutional Shares | (23,741,494 | ) | (25,637,022 | ) | ||||
Open Shares | (21,871 | ) | (35,952 | ) | ||||
Net increase (decrease) in net assets from capital stock transactions | (17,713,442 | ) | 16,808,862 | |||||
Total increase (decrease) in net assets | (17,034,116 | ) | 15,897,095 | |||||
Net assets at beginning of period | 116,312,505 | 100,415,410 | ||||||
Net assets at end of period | $ | 99,278,389 | $ | 116,312,505 | ||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 11,984,211 | 10,259,235 | ||||||
Shares sold | 499,924 | 4,157,165 | ||||||
Shares issued to shareholders from reinvestment of distributions | 122,116 | 206,126 | ||||||
Shares redeemed | (2,441,661 | ) | (2,638,315 | ) | ||||
Net increase (decrease) | (1,819,621 | ) | 1,724,976 | |||||
Shares outstanding at end of period | 10,164,590 | 11,984,211 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 3,789 | 2,561 | ||||||
Shares sold | — | 4,869 | ||||||
Shares issued to shareholders from reinvestment of distributions | 25 | 53 | ||||||
Shares redeemed | (2,247 | ) | (3,694 | ) | ||||
Net increase (decrease) | (2,222 | ) | 1,228 | |||||
Shares outstanding at end of period | 1,567 | 3,789 |
The accompanying notes are an integral part of these financial statements.
76 Semi-Annual Report
The Lazard Funds, Inc.Financial Highlights
LAZARD EMERGING MARKETS DEBT PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.36 | $ | 8.43 | $ | 7.90 | $ | 7.71 | $ | 8.84 | $ | 9.53 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.20 | 0.46 | 0.46 | 0.48 | ^ | 0.39 | 0.49 | |||||||||||||||||
Net realized and unrealized gain (loss) | 0.59 | (1.07 | ) | 0.53 | 0.19 | (1.13 | ) | (0.66 | ) | |||||||||||||||
Total from investment operations | 0.79 | (0.61 | ) | 0.99 | 0.67 | (0.74 | ) | (0.17 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.20 | ) | (0.22 | ) | (0.43 | ) | (0.19 | ) | — | (b) | (0.15 | ) | ||||||||||||
Return of capital | — | (0.24 | ) | (0.03 | ) | (0.29 | ) | (0.39 | ) | (0.37 | ) | |||||||||||||
Total distributions | (0.20 | ) | (0.46 | ) | (0.46 | ) | (0.48 | ) | (0.39 | ) | (0.52 | ) | ||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 7.95 | $ | 7.36 | $ | 8.43 | $ | 7.90 | $ | 7.71 | $ | 8.84 | ||||||||||||
Total Return (c) | 10.84 | % | –7.45 | % | 12.69 | % | 8.64 | %^ | –8.55 | % | –2.07 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 107,645 | $ | 143,015 | $ | 280,808 | $ | 240,833 | $ | 258,517 | $ | 326,165 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.97 | % | 0.93 | % | 0.93 | % | 0.96 | %^ | 0.96 | % | 0.96 | % | ||||||||||||
Gross expenses | 0.99 | % | 0.93 | % | 0.93 | % | 0.96 | % | 0.96 | % | 0.96 | % | ||||||||||||
Net investment income (loss) | 5.25 | % | 5.78 | % | 5.52 | % | 5.90 | %^ | 4.69 | % | 5.14 | % | ||||||||||||
Portfolio turnover rate | 59 | % | 97 | % | 88 | % | 118 | % | 162 | % | 204 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 77
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 7.43 | $ | 8.50 | $ | 7.98 | $ | 7.79 | $ | 8.91 | $ | 9.59 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.19 | 0.47 | 0.44 | 0.46 | ^ | 0.36 | 0.46 | |||||||||||||||||
Net realized and unrealized gain (loss) | 0.60 | (1.10 | ) | 0.51 | 0.19 | (1.11 | ) | (0.68 | ) | |||||||||||||||
Total from investment operations | 0.79 | (0.63 | ) | 0.95 | 0.65 | (0.75 | ) | (0.22 | ) | |||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.19 | ) | (0.20 | ) | (0.40 | ) | (0.18 | ) | — | (b) | (0.09 | ) | ||||||||||||
Return of capital | — | (0.24 | ) | (0.03 | ) | (0.28 | ) | (0.37 | ) | (0.37 | ) | |||||||||||||
Total distributions | (0.19 | ) | (0.44 | ) | (0.43 | ) | (0.46 | ) | (0.37 | ) | (0.46 | ) | ||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | (b) | ||||||||||||||||
Net asset value, end of period | $ | 8.03 | $ | 7.43 | $ | 8.50 | $ | 7.98 | $ | 7.79 | $ | 8.91 | ||||||||||||
Total Return (c) | 10.79 | % | –7.59 | % | 12.16 | % | 8.27 | %^ | –8.64 | % | –2.53 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 674 | $ | 670 | $ | 6,520 | $ | 6,801 | $ | 6,910 | $ | 1,107 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 1.17 | % | 1.20 | % | 1.22 | % | 1.28 | %^ | 1.30 | % | 1.30 | % | ||||||||||||
Gross expenses | 1.68 | % | 1.62 | % | 1.36 | % | 1.40 | % | 1.75 | % | 1.71 | % | ||||||||||||
Net investment income (loss) | 5.00 | % | 5.49 | % | 5.21 | % | 5.59 | %^ | 4.54 | % | 4.80 | % | ||||||||||||
Portfolio turnover rate | 59 | % | 97 | % | 88 | % | 118 | % | 162 | % | 204 | % |
The accompanying notes are an integral part of these financial statements.
78 Semi-Annual Report
Selected data for a share of capital stock | Six Months | For the Period | |||||||||||||||
outstanding throughout | Ended | Year Ended | 7/28/16* to | ||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | |||||||||||||
R6 Shares | |||||||||||||||||
Net asset value, beginning of period | $ | 7.88 | $ | 8.88 | $ | 7.90 | $ | 8.34 | |||||||||
Income (Loss) from investment operations: | |||||||||||||||||
Net investment income (loss) (a) | 0.21 | 0.48 | 0.45 | 0.20 | ^ | ||||||||||||
Net realized and unrealized gain (loss) | 0.64 | (1.12 | ) | 0.54 | (0.44 | ) | |||||||||||
Total from investment operations | 0.85 | (0.64 | ) | 0.99 | (0.24 | ) | |||||||||||
Less distributions from: | |||||||||||||||||
Net investment income | (0.22 | ) | (0.11 | ) | (0.01 | ) | (0.08 | ) | |||||||||
Return of capital | — | (0.25 | ) | — | (b) | (0.12 | ) | ||||||||||
Total distributions | (0.22 | ) | (0.36 | ) | (0.01 | ) | (0.20 | ) | |||||||||
Net asset value, end of period | $ | 8.51 | $ | 7.88 | $ | 8.88 | $ | 7.90 | |||||||||
Total Return (c) | 10.84 | % | –7.24 | % | 12.61 | % | –2.93 | %^ | |||||||||
Ratios and Supplemental Data: | |||||||||||||||||
Net assets, end of period (in thousands) | $ | 66,381 | $ | 99,952 | $ | 1 | $ | 1,145 | |||||||||
Ratios to average net assets (d): | |||||||||||||||||
Net expenses | 0.92 | % | 0.90 | % | 0.90 | % | 0.90 | %^ | |||||||||
Gross expenses | 0.99 | % | 0.94 | % | 43.88 | % | 2.21 | % | |||||||||
Net investment income (loss) | 5.20 | % | 5.97 | % | 5.71 | % | 5.73 | %^ | |||||||||
Portfolio turnover rate | 59 | % | 97 | % | 88 | % | 118 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was July 28, 2016. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. For Institutional Shares, there was a 0.14% impact on the total return and the impact on net expenses and net investment income (loss) ratios of the Portfolio was less than 0.005%. For Open and R6 Shares, there was no impact on the total return and the net expenses and net investment income (loss) ratios of the Portfolio would be unchanged as the change to the period custodian fees was offset against the period expense waivers/ reimbursements with no impact to net expenses or net investment income (loss). |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 79
LAZARD GLOBAL FIXED INCOME PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.65 | $ | 9.04 | $ | 8.57 | $ | 8.74 | $ | 9.30 | $ | 9.51 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.20 | 0.20 | 0.20 | 0.19 | 0.22 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.40 | (0.38 | ) | 0.47 | (0.17 | ) | (0.56 | ) | (0.21 | ) | ||||||||||||||
Total from investment operations | 0.50 | (0.18 | ) | 0.67 | 0.03 | (0.37 | ) | 0.01 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.10 | ) | (0.10 | ) | — | (0.12 | ) | — | (0.17 | ) | ||||||||||||||
Return of capital | — | (0.11 | ) | (0.20 | ) | (0.08 | ) | (0.19 | ) | (0.05 | ) | |||||||||||||
Total distributions | (0.10 | ) | (0.21 | ) | (0.20 | ) | (0.20 | ) | (0.19 | ) | (0.22 | ) | ||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | |||||||||||||||||
Net asset value, end of period | $ | 9.05 | $ | 8.65 | $ | 9.04 | $ | 8.57 | $ | 8.74 | $ | 9.30 | ||||||||||||
Total Return (c) | 5.80 | % | –2.06 | % | 7.87 | % | 0.22 | % | –4.03 | % | 0.08 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 6,167 | $ | 5,495 | $ | 4,705 | $ | 4,266 | $ | 5,795 | $ | 6,497 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.70 | % | 0.70 | % | 0.72 | % | 0.75 | % | 0.76 | % | 0.80 | % | ||||||||||||
Gross expenses | 3.42 | % | 3.61 | % | 4.39 | % | 4.70 | % | 4.26 | % | 4.12 | % | ||||||||||||
Net investment income (loss) | 2.28 | % | 2.33 | % | 2.23 | % | 2.18 | % | 2.08 | % | 2.28 | % | ||||||||||||
Portfolio turnover rate | 39 | % | 60 | % | 42 | % | 47 | % | 60 | % | 78 | % |
The accompanying notes are an integral part of these financial statements.
80 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.65 | $ | 9.04 | $ | 8.57 | $ | 8.74 | $ | 9.30 | $ | 9.51 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.09 | 0.18 | 0.17 | 0.17 | 0.16 | 0.19 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.40 | (0.39 | ) | 0.47 | (0.17 | ) | (0.56 | ) | (0.21 | ) | ||||||||||||||
Total from investment operations | 0.49 | (0.21 | ) | 0.64 | — | (b) | (0.40 | ) | (0.02 | ) | ||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.09 | ) | (0.08 | ) | — | (0.10 | ) | — | (0.14 | ) | ||||||||||||||
Return of capital | — | (0.10 | ) | (0.17 | ) | (0.07 | ) | (0.16 | ) | (0.05 | ) | |||||||||||||
Total distributions | (0.09 | ) | (0.18 | ) | (0.17 | ) | (0.17 | ) | (0.16 | ) | (0.19 | ) | ||||||||||||
Redemption fees | — | — | — | — | — | — | (b) | |||||||||||||||||
Net asset value, end of period | $ | 9.05 | $ | 8.65 | $ | 9.04 | $ | 8.57 | $ | 8.74 | $ | 9.30 | ||||||||||||
Total Return (c) | 5.79 | % | –2.31 | % | 7.55 | % | –0.07 | % | –4.31 | % | –0.22 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 40 | $ | 33 | $ | 34 | $ | 34 | $ | 56 | $ | 56 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.95 | % | 0.98 | % | 1.02 | % | 1.05 | % | 1.06 | % | 1.10 | % | ||||||||||||
Gross expenses | 11.22 | % | 38.42 | % | 42.88 | % | 27.52 | % | 27.72 | % | 20.84 | % | ||||||||||||
Net investment income (loss) | 2.03 | % | 2.08 | % | 1.95 | % | 1.88 | % | 1.80 | % | 2.01 | % | ||||||||||||
Portfolio turnover rate | 39 | % | 60 | % | 42 | % | 47 | % | 60 | % | 78 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 81
LAZARD US CORPORATE INCOME PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 4.54 | $ | 4.89 | $ | 4.87 | $ | 4.64 | $ | 4.91 | $ | 5.01 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.22 | 0.22 | 0.23 | 0.24 | 0.26 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.32 | (0.35 | ) | 0.02 | 0.23 | (0.27 | ) | (0.09 | ) | |||||||||||||||
Total from investment operations | 0.43 | (0.13 | ) | 0.24 | 0.46 | (0.03 | ) | 0.17 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.11 | ) | (0.22 | ) | (0.22 | ) | (0.23 | ) | (0.24 | ) | (0.27 | ) | ||||||||||||
Return of capital | — | — | — | — | — | (b) | — | |||||||||||||||||
Total distributions | (0.11 | ) | (0.22 | ) | (0.22 | ) | (0.23 | ) | (0.24 | ) | (0.27 | ) | ||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | |||||||||||||||
Net asset value, end of period | $ | 4.86 | $ | 4.54 | $ | 4.89 | $ | 4.87 | $ | 4.64 | $ | 4.91 | ||||||||||||
Total Return (c) | 9.56 | % | –2.73 | % | 5.09 | % | 10.09 | % | –0.71 | % | 3.31 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 299,741 | $ | 308,285 | $ | 344,508 | $ | 302,997 | $ | 243,712 | $ | 185,959 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.55 | % | 0.55 | % | 0.55 | % | 0.55 | % | 0.55 | % | 0.55 | % | ||||||||||||
Gross expenses | 0.66 | % | 0.64 | % | 0.67 | % | 0.69 | % | 0.69 | % | 0.71 | % | ||||||||||||
Net investment income (loss) | 4.71 | % | 4.65 | % | 4.57 | % | 4.78 | % | 4.94 | % | 5.28 | % | ||||||||||||
Portfolio turnover rate | 6 | % | 16 | % | 21 | % | 14 | % | 17 | % | 28 | % |
The accompanying notes are an integral part of these financial statements.
82 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 4.57 | $ | 4.91 | $ | 4.89 | $ | 4.66 | $ | 4.93 | $ | 5.03 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.21 | 0.21 | 0.21 | 0.23 | 0.25 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.31 | (0.34 | ) | 0.02 | 0.24 | (0.27 | ) | (0.10 | ) | |||||||||||||||
Total from investment operations | 0.41 | (0.13 | ) | 0.23 | 0.45 | (0.04 | ) | 0.15 | ||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.10 | ) | (0.21 | ) | (0.21 | ) | (0.22 | ) | (0.23 | ) | (0.25 | ) | ||||||||||||
Return of capital | — | — | — | — | — | (b) | — | |||||||||||||||||
Total distributions | (0.10 | ) | (0.21 | ) | (0.21 | ) | (0.22 | ) | (0.23 | ) | (0.25 | ) | ||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | ||||||||||||||||
Net asset value, end of period | $ | 4.88 | $ | 4.57 | $ | 4.91 | $ | 4.89 | $ | 4.66 | $ | 4.93 | ||||||||||||
Total Return (c) | 9.12 | % | –2.78 | % | 4.77 | % | 9.74 | % | –0.98 | % | 3.01 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 3,625 | $ | 4,314 | $ | 5,708 | $ | 7,618 | $ | 1,968 | $ | 1,811 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.85 | % | 0.85 | % | 0.85 | % | 0.85 | % | 0.85 | % | 0.85 | % | ||||||||||||
Gross expenses | 1.00 | % | 1.11 | % | 1.13 | % | 1.18 | % | 1.69 | % | 1.55 | % | ||||||||||||
Net investment income (loss) | 4.41 | % | 4.34 | % | 4.28 | % | 4.44 | % | 4.65 | % | 5.00 | % | ||||||||||||
Portfolio turnover rate | 6 | % | 16 | % | 21 | % | 14 | % | 17 | % | 28 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 83
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | For the Period 11/3/16* to | |||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | ||||||||||||||||||||
R6 Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 4.67 | $ | 4.89 | $ | 4.87 | $ | 4.84 | ||||||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.23 | 0.22 | 0.04 | ||||||||||||||||||||
Net realized and unrealized gain (loss) | 0.20 | (0.35 | ) | 0.02 | 0.03 | |||||||||||||||||||
Total from investment operations | 0.31 | (0.12 | ) | 0.24 | 0.07 | |||||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.11 | ) | (0.10 | ) | (0.22 | ) | (0.04 | ) | ||||||||||||||||
Total distributions | (0.11 | ) | (0.10 | ) | (0.22 | ) | (0.04 | ) | ||||||||||||||||
Net asset value, end of period | $ | 4.87 | $ | 4.67 | $ | 4.89 | $ | 4.87 | ||||||||||||||||
Total Return (c) | 6.73 | % | –2.43 | %# | 5.09 | % | 1.37 | % | ||||||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 1 | $ | 1 | $ | 1,783 | $ | 1,697 | ||||||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.55 | % | 0.55 | % | 0.55 | % | 0.55 | % | ||||||||||||||||
Gross expenses | 248.65 | % | 4.62 | % | 1.69 | % | 1.73 | % | ||||||||||||||||
Net investment income (loss) | 4.50 | % | 4.61 | % | 4.58 | % | 4.71 | % | ||||||||||||||||
Portfolio turnover rate | 6 | % | 16 | % | 21 | % | 14 | % |
† | Unaudited. |
* | The inception date for the R6 Shares was November 3, 2016. |
# | The Portfolio received settlement proceeds from a foreign exchange trading class action lawsuit. The proceeds from the settlement represented a realized gain and were recorded in the period received. There was a 0.62% impact on the total return of the Portfolio’s R6 Shares. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
84 Semi-Annual Report
LAZARD US SHORT DURATION FIXED INCOME PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Institutional Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.70 | $ | 9.79 | $ | 9.86 | $ | 9.89 | $ | 9.99 | $ | 10.03 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.11 | 0.19 | 0.14 | 0.13 | 0.10 | 0.09 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.07 | (0.09 | ) | (0.07 | ) | (0.03 | ) | (0.09 | ) | (0.04 | ) | |||||||||||||
Total from investment operations | 0.18 | 0.10 | 0.07 | 0.10 | 0.01 | 0.05 | ||||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.11 | ) | (0.17 | ) | (0.11 | ) | (0.09 | ) | (0.06 | ) | (0.05 | ) | ||||||||||||
Return of capital | — | (0.02 | ) | (0.03 | ) | (0.04 | ) | (0.05 | ) | (0.04 | ) | |||||||||||||
Total distributions | (0.11 | ) | (0.19 | ) | (0.14 | ) | (0.13 | ) | (0.11 | ) | (0.09 | ) | ||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | |||||||||||||||||
Net asset value, end of period | $ | 9.77 | $ | 9.70 | $ | 9.79 | $ | 9.86 | $ | 9.89 | $ | 9.99 | ||||||||||||
Total Return(c) | 1.90 | % | 1.08 | % | 0.72 | % | 1.00 | % | 0.05 | % | 0.49 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 99,263 | $ | 116,276 | $ | 100,390 | $ | 103,175 | $ | 103,150 | $ | 114,705 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.40 | % | 0.40 | % | 0.40 | % | 0.40 | % | 0.40 | % | 0.40 | % | ||||||||||||
Gross expenses | 0.43 | % | 0.43 | % | 0.43 | % | 0.50 | % | 0.48 | % | 0.52 | % | ||||||||||||
Net investment income (loss) | 2.34 | % | 2.00 | % | 1.43 | % | 1.30 | % | 1.05 | % | 0.87 | % | ||||||||||||
Portfolio turnover rate | 65 | % | 170 | % | 108 | % | 157 | % | 57 | % | 46 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 85
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | ||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | ||||||||||||||||||
Open Shares | ||||||||||||||||||||||||
Net asset value, beginning of period | $ | 9.71 | $ | 9.79 | $ | 9.87 | $ | 9.90 | $ | 10.01 | $ | 10.03 | ||||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.16 | 0.11 | 0.10 | 0.17 | 0.06 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.06 | (0.08 | ) | (0.08 | ) | (0.03 | ) | (0.09 | ) | (0.02 | ) | |||||||||||||
Total from investment operations | 0.16 | 0.08 | 0.03 | 0.07 | 0.08 | 0.04 | ||||||||||||||||||
Less distributions from: | ||||||||||||||||||||||||
Net investment income | (0.10 | ) | (0.14 | ) | (0.09 | ) | (0.07 | ) | (0.14 | ) | (0.02 | ) | ||||||||||||
Return of capital | — | (0.02 | ) | (0.02 | ) | (0.03 | ) | (0.05 | ) | (0.04 | ) | |||||||||||||
Total distributions | (0.10 | ) | (0.16 | ) | (0.11 | ) | (0.10 | ) | (0.19 | ) | (0.06 | ) | ||||||||||||
Redemption fees | — | — | — | — | — | (b) | — | |||||||||||||||||
Net asset value, end of period | $ | 9.77 | $ | 9.71 | $ | 9.79 | $ | 9.87 | $ | 9.90 | $ | 10.01 | ||||||||||||
Total Return (c) | 1.64 | % | 0.88 | % | 0.32 | % | 0.70 | % | 0.77 | % | 0.38 | % | ||||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 15 | $ | 37 | $ | 25 | $ | 44 | $ | 27 | $ | 36 | ||||||||||||
Ratios to average net assets (d): | ||||||||||||||||||||||||
Net expenses | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | 0.70 | % | ||||||||||||
Gross expenses | 12.10 | % | 38.00 | % | 33.88 | % | 31.22 | % | 42.51 | % | 17.62 | % | ||||||||||||
Net investment income (loss) | 2.04 | % | 1.68 | % | 1.13 | % | 1.00 | % | 1.68 | % | 0.60 | % | ||||||||||||
Portfolio turnover rate | 65 | % | 170 | % | 108 | % | 157 | % | 57 | % | 46 | % |
† | Unaudited. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
86 Semi-Annual Report
The Lazard Funds, Inc.Notes to Financial Statements
June 30, 2019 (unaudited)
1. Organization
The Lazard Funds, Inc. was incorporated in Maryland on May 17, 1991 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. As of June 30, 2019, the Fund was comprised of thirty-two no-load portfolios (each referred to as a “Portfolio”). This report includes only the financial statements of Emerging Markets Debt, Global Fixed Income, US Corporate Income and US Short Duration Fixed Income Portfolios. The financial statements of the other twenty-eight Portfolios are presented separately.
The Portfolios, other than Emerging Markets Debt Portfolio, are operated as “diversified” funds, as defined in the 1940 Act.
Each Portfolio currently offers Institutional Shares and Open Shares, and certain Portfolios offer R6 Shares. Each share class is identical except as to minimum investment requirements; eligibility requirements for R6 Shares; the services offered to, and expenses borne by, each class; and the availability of Service Payments (as defined in the Portfolios’ Prospectus).
2. Significant Accounting Policies
The accompanying financial statements are presented in conformity with US Generally Accepted Accounting Principles (“GAAP”). The Fund is an investment company and therefore applies specialized accounting guidance in accordance with Accounting Standards Codification Topic 946. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of the financial statements:
(a) Valuation of Investments—Bonds and other fixed-income securities that are not exchange-traded are valued on the basis of prices provided by independent pricing services which are based on, among other things, trading in securities with similar characteristics, brokers’ quotations and/or a matrix system which considers such factors as other security prices, yields and maturities. Swap agreements, such as credit default, interest rate and total return swap agreements, generally are valued by an independent pricing service. Forward currency contracts generally are valued
Semi-Annual Report 87
using quotations from an independent pricing service. Investments in money market funds are valued at the fund’s net asset value (“NAV”) per share.
Calculation of a Portfolio’s NAV may not take place contemporaneously with the determination of the prices of portfolio assets used in such calculation. Trading on Europe, Latin and South America and Far East securities exchanges and in over-the-counter markets ordinarily is completed well before the close of business on each business day in New York (i.e., a day on which the New York Stock Exchange (the “NYSE”) is open). In addition, European or Far Eastern securities trading generally, or in a particular country or countries, may not take place on all business days in New York and on which the NAV of a Portfolio is calculated.
The Valuation Committee of Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), which meets periodically under the direction of the Board of Directors (the “Board”), may evaluate a variety of factors to determine the fair value of securities for which market quotations are determined not to be readily available or reliable. These factors include, but are not limited to, the type of security, the value of comparable securities, observations from financial institutions and relevant news events. Input from the Investment Manager’s portfolio managers/analysts also will be considered.
If a significant event materially affecting the value of securities occurs between the close of the exchange or market on which the security is principally traded and the time when a Portfolio’s NAV is calculated, or when current market quotations otherwise are determined not to be readily available or reliable (including restricted or other illiquid securities such as certain derivative instruments), such securities will be valued at their fair value as determined by, or in accordance with procedures approved by, the Board. Non-US securities may trade on days when a Portfolio is not open for business, thus affecting the value of the Portfolio’s assets on days when Portfolio shareholders may not be able to buy or sell Portfolio shares.
88 Semi-Annual Report
The effect of using fair value pricing is that the NAV of a Portfolio will reflect the affected securities’ values as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price securities may result in a value that is different from the most recent closing price of a security and from the prices used by other investment companies to calculate their portfolios’ NAVs.
(b) Portfolio Securities Transactions and Investment Income—Portfolio securities transactions are accounted for on trade date. Realized gain (loss) on sales of investments are recorded on a specific identification basis. Interest income is accrued daily. A Portfolio amortizes premiums and accretes discounts on fixed-income securities using the effective yield method and mortgage-backed securities using the level yield method.
A Portfolio may be subject to taxes imposed by non-US countries in which it invests. Such taxes are generally based upon income earned or capital gains (realized and/or unrealized). An affected Portfolio accrues and applies such taxes to net investment income, net realized gains and net unrealized gains concurrent with the recognition of income earned or capital gains (realized and/or unrealized) from the applicable portfolio securities.
(c) Foreign Currency Translation and Forward Currency Contracts—The accounting records of the Fund are maintained in US dollars. Portfolio securities and other assets and liabilities denominated in a foreign currency are translated daily into US dollars at the prevailing rates of exchange. Purchases and sales of securities, income receipts and expense payments are translated into US dollars at the prevailing exchange rates on the respective transaction dates.
The Portfolios do not isolate the portion of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in their market prices. Such fluctuations are included in net realized and unrealized gain (loss) on investments. Net realized gain (loss) on foreign currency transactions and forward currency contracts represent net foreign currency gain (loss) from forward currency contracts, disposition of foreign currencies, currency gain (loss) realized between the trade and settlement dates
Semi-Annual Report 89
on securities transactions, and the difference between the amount of interest and foreign withholding taxes recorded on the Portfolios’ accounting records and the US dollar equivalent amounts actually received or paid. Net change in unrealized appreciation (depreciation) on foreign currency translations reflects the impact of changes in exchange rates on the value of assets and liabilities, other than investments in securities, during the period.
A forward currency contract is an agreement between two parties to buy or sell currency at a set price on a future date. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of the foreign currency relative to the US dollar.
The US dollar value of forward currency contracts is determined using quotations provided by an independent pricing service. Daily fluctuations in the value of such contracts are recorded as unrealized appreciation (depreciation) on forward currency contracts. When the contract is closed, a Portfolio records a realized gain (loss) equal to the difference between the value at the time it was opened and the value at the time it was closed.
During the period ended June 30, 2019, the Emerging Markets Debt and Global Fixed Income Portfolios traded in forward currency contracts.
(d) Swap Agreements—Interest rate swap agreements involve the exchange by a Portfolio with another party of their respective commitments to pay or receive interest with respect to the notional amount of principal. Certain forms of interest rate swap agreements may include: (i) interest rate caps, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates exceed a specified rate, or “cap,” (ii) interest rate floors, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates fall below a specified rate, or “floor,” (iii) interest rate collars, under which a party sells a cap and purchases a floor or vice versa in an attempt to protect itself against interest rate movements exceeding given minimum or maximum levels,
90 Semi-Annual Report
(iv) callable interest rate swaps, under which the counterparty may terminate the swap transaction in whole at zero cost by a predetermined date and time prior to the maturity date, (v) spread locks, which allow the interest rate swap users to lock in the forward differential (or spread) between the interest rate swap rate and specified benchmark, or (vi) basis swaps, under which two parties can exchange variable interest rates based on different money markets. Swap agreements generally are valued by an independent pricing service, and the change in value, if any, is recorded as unrealized appreciation (depreciation) on swap agreements in a Portfolio’s accompanying Statement of Assets and Liabilities. Once the interim payments are settled in cash, the net amount is recorded as realized gain (loss) on swap agreements in a Portfolio’s accompanying Statement of Operations, in addition to any realized gain (loss) recorded upon the termination of swap agreements.
During the period ended June 30, 2019, the Emerging Markets Debt Portfolio traded in swap agreements.
(e) Federal Income Taxes—The Fund’s policy is to have each Portfolio qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and to distribute all of its taxable income, including any net realized capital gains, to shareholders. Therefore, no federal income tax provision is required.
At December 31, 2018, the following Portfolios had unused realized capital loss carryovers which, for federal income tax purposes, could be used to offset future realized capital gains with no expiration date as follows:
Portfolio | Short-Term | Long-Term | ||||||
Emerging Markets Debt | $ | 26,228,591 | $ | 14,492,603 | ||||
Global Fixed Income | 21,530 | 20,133 | ||||||
US Corporate Income | 3,242,094 | 3,076,895 | ||||||
US Short Duration Fixed Income | 1,194,698 | 348,713 |
Under current tax law, post-October capital losses or certain late-year ordinary losses, as defined by the Code, within the taxable year may be deferred and treated as occurring on the first day of
Semi-Annual Report 91
the following tax year. For the tax year ended December 31, 2018, the following Portfolio elected to defer such losses as follows:
Portfolio | Post-October Capital Loss Deferral | Late-Year Ordinary Loss Deferral | ||||||
US Short Duration Fixed Income | $ | — | $27,635 |
For federal income tax purposes, the aggregate cost, aggregate gross unrealized appreciation, aggregate gross unrealized depreciation and the net unrealized appreciation (depreciation) were as follows:
Portfolio | Aggregate Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized Depreciation | Net Unrealized Appreciation (Depreciation) | ||||||||||||
Emerging Markets Debt | $ | 168,795,363 | $ | 9,397,129 | $ 4,757,537 | $ 4,639,592 | ||||||||||
Global Fixed Income | 6,047,910 | 219,390 | 105,028 | 114,362 | ||||||||||||
US Corporate Income | 289,341,865 | 5,466,358 | 2,987,866 | 2,478,492 | ||||||||||||
US Short Duration Fixed Income | 98,139,453 | 489,471 | 77,260 | 412,211 |
Management has analyzed the Portfolios’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on tax returns filed for any open tax years (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction’s statute of limitations. Each Portfolio files a US federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal Revenue Service for a period of three years from the date of filing.
(f) Dividends and Distributions—Emerging Markets Debt Portfolio intends to declare dividends from net investment income, if any, daily and to pay such dividends monthly. Dividends from net investment income, if any, on the other Portfolios will be declared and paid monthly. During any particular year, net realized gains from investment transactions in excess of available capital loss carryforwards would be taxable to the Portfolios, if not distributed. The Portfolios intend to declare and distribute these amounts, at least annually, to shareholders; however, to avoid taxation, a second dis-
92 Semi-Annual Report
tribution may be required. Differences in per share distributions, by class, are generally due to differences in class specific expenses.
Income and capital gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These book/tax differences, which may result in distribution reclassifications, are primarily due to differing treatments of foreign currency and fixed-income transactions, certain fixed-income securities and expenses, derivatives, wash sales, return of capital distributions, currency straddles and paydown gain/loss. The book/tax differences relating to shareholder distributions may result in reclassifications among certain capital accounts.
(g) Allocation of Expenses—Expenses common to the Fund, Lazard Retirement Series, Inc., Lazard Global Total Return and Income Fund, Inc. and Lazard World Dividend & Income Fund, Inc. (each a “Lazard Fund” and collectively, the “Lazard Fund Complex”), each a registered management investment company advised by the Investment Manager, not directly chargeable to one or more specific Lazard Funds are allocated to the Fund and among its Portfolios primarily on the basis of relative net assets. Expenses of the Fund not directly chargeable to one or more Portfolios are similarly allocated among the Portfolios on the basis of relative net assets. Portfolios accrue distribution and service (12b-1) fees to Open Shares. The Portfolios’ income, expenses (other than class specific expenses) and realized and unrealized gains and losses are allocated proportionally each day between the classes based upon the relative net assets of each class.
(h) Redemption Fee—Until August 15, 2016, the Portfolios, other than the US Short Duration Fixed Income Portfolio, imposed a 1.00% redemption fee (short-term trading fee) on Portfolio shares redeemed less than 30 days after such shares were acquired. The fees were retained by the Portfolios and are included as paid in capital on the Statements of Assets and Liabilities. As of August 15, 2016, redemption fees no longer apply to transactions in Portfolio shares.
(i) Estimates—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabili-
Semi-Annual Report 93
ties and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
(j) Net Asset Value—NAV per share for each class of each Portfolio is determined each day the NYSE is open for trading as of the close of regular trading on the NYSE (generally 4:00 p.m. Eastern time). The Fund will not treat an intraday unscheduled disruption in NYSE trading as a closure of the NYSE, and will price its shares as of 4:00 p.m., if the particular disruption directly affects only the NYSE. NAV per share is determined by dividing the value of the total assets of the Portfolio represented by such class, less all liabilities, by the total number of Portfolio shares of such class outstanding.
3. Investment Management, Administration, Custody, Distribution and Transfer Agency Agreements
The Fund, on behalf of the Portfolios, has entered into a management agreement (the “Management Agreement”) with the Investment Manager. Pursuant to the Management Agreement, the Investment Manager regularly provides each Portfolio with investment research, advice and supervision and furnishes continuously an investment program for each Portfolio consistent with its investment objectives and policies, including the purchase, retention and disposition of securities, and provides the Portfolios with administrative, operational and compliance assistance services. For its services provided to the Portfolios, the Investment Manager earns a management fee, accrued daily as a percentage of each Portfolio’s average daily net assets and payable by each Portfolio monthly, at the annual rate set forth below:
Portfolio | Annual Rate | ||||
Emerging Markets Debt | 0.75 | % | |||
Global Fixed Income | 0.50 | ||||
US Corporate Income | 0.55 | ||||
US Short Duration Fixed Income | 0.25 |
The Investment Manager has voluntarily agreed, until May 1, 2020 shown below, to waive its fees and, if necessary, reimburse the Portfolios if the aggregate direct expenses of the Portfolios, exclu-
94 Semi-Annual Report
sive of taxes, brokerage, interest on borrowings, fees and expenses of “Acquired Funds” (as defined in Form N-1A) and extraordinary expenses, including, for the purposes of the expense limitation agreement only, fees related to filing foreign tax reclaims, exceed the percentages of the value of the Portfolio’s average daily net assets set forth opposite the Portfolio’s name on table below. The Fund, on behalf of the Portfolio, may deduct from the payment to be made to the Investment Manager under the Management Agreement, or the Investment Manager will bear, such excess expense.
Portfolio | Institutional Shares | Open Shares | R6 Shares | |||||||||
Emerging Markets Debt | 0.95 | % | 1.15 | % | 0.90 | %(a) | ||||||
Global Fixed Income | 0.70 | 0.95 | N/A | |||||||||
US Corporate Income | 0.55 | 0.85 | 0.55 | |||||||||
US Short Duration Fixed Income | 0.40 | 0.70 | N/A | |||||||||
(a) | Agreement extends from May 1, 2020 to May 1, 2029, at levels of 1.10%, 1.35%, and 1.05%, respectively. |
In addition, until May 1, 2020, to the extent the “Total Annual Fund Operating Expenses” (as used in Form N-1A) of the R6 Shares of a Portfolio exceed the Total Annual Fund Operating Expenses of the Portfolio’s Institutional Shares (in each case, not including management fees, custodial fees or other expenses related to the management of the Portfolio’s assets), the Investment Manager will bear the expenses of the R6 Shares in the amount of such excess.
During the period ended June 30, 2019, the Investment Manager waived its management fees and reimbursed the following Portfolios for other expenses as follows:
Institutional Shares | Open Shares | ||||||||||||||||
Portfolio | Management Fees Waived | Expenses Reimbursed | Management Fees Waived | Expenses Reimbursed | |||||||||||||
Emerging Markets Debt | $ | 11,569 | $ | — | $ | 1,693 | $ | — | |||||||||
Global Fixed Income | 14,216 | 63,088 | 90 | 1,761 | |||||||||||||
US Corporate Income | 162,009 | — | 2,687 | — | |||||||||||||
US Short Duration Fixed Income | 13,316 | — | 30 | 1,349 |
R6 Shares | |||||||||
Portfolio | Management Fees Waived | Expenses Reimbursed | |||||||
Emerging Markets Debt | $24,123 | $ | — | ||||||
US Corporate Income | 4 | 1,319 |
Semi-Annual Report 95
The aforementioned waivers and/or reimbursements are not subject to recoupment by the Investment Manager.
State Street provides the Fund with custody and certain fund administration and accounting services.
In December 2015, State Street announced that it had identified inconsistencies in the way in which clients were invoiced for custody out-of-pocket expenses from 1998 until 2015. The difference between what was charged and what should have been charged, plus interest, was recorded as a reimbursement when determined in 2016. Pursuant to the expense limitations described above, certain Portfolios experienced management fee waivers during the year ended December 31, 2016. Accordingly, the reimbursement of out-of-pocket expenses resulted in the reduction in the waiver of management fees for certain Portfolios for the year ended December 31, 2016.
The Fund has a distribution agreement with Lazard Asset Management Securities LLC (the “Distributor”), a wholly-owned subsidiary of the Investment Manager, to serve as the distributor for shares of each Portfolio. The Distributor bears the cost of printing and mailing prospectuses to potential investors and certain expenses in connection with the offering of Portfolio shares.
Under a distribution and servicing plan adopted pursuant to Rule 12b-1 under the 1940 Act, each Portfolio pays a monthly fee to the Distributor, at an annual rate of 0.25% of the average daily net assets of its Open Shares, for distribution and servicing of accounts. The Distributor may make payments to certain financial institutions, securities dealers and other industry professionals for providing these services.
DST is the Fund’s transfer and dividend disbursing agent.
4. Directors’ Compensation
Certain Directors of the Fund are officers of the Investment Manager. For the period ended June 30, 2019, each Director who is not an affiliated person of the Investment Manager or any of its affiliates was paid by all of the funds in the Lazard Fund Complex: (1) an annual retainer of $232,000, (2) an additional annual fee of
96 Semi-Annual Report
$33,000 to the lead Independent Director (an “Independent Director” is a Director who is not an “interested person” (as defined in the 1940 Act) of the Fund), and (3) an additional annual fee of $23,000 to the Audit Committee Chair. The Independent Directors may be paid additional compensation for participation on ad hoc committees or other work performed on behalf of the Board. The Independent Directors also are reimbursed for travel and other out-of-pocket expenses for attending Board and committee meetings. The Directors do not receive benefits from the Fund pursuant to any pension, retirement or similar arrangement. Independent Directors’ fees are allocated among the funds in the Lazard Fund Complex at a rate of $5,000 per fund with the remainder allocated based upon each fund’s proportionate share of combined net assets. The Statements of Operations show the Independent Directors’ fees and expenses paid by each Portfolio.
5. Securities Transactions and Transactions with Affiliates
Purchases and sales of portfolio securities (excluding short-term investments) for the period ended June 30, 2019 were as follows:
Portfolio | Purchases | Sales | ||||||
Emerging Markets Debt | $ | 114,890,108 | $ | 190,381,656 | ||||
Global Fixed Income | 2,225,782 | 1,680,686 | ||||||
US Corporate Income | 18,144,111 | 57,754,757 | ||||||
US Short Duration Fixed Income | 15,857,779 | 22,040,366 |
US Government and Treasury Securities | ||||||||
Portfolio | Purchases | Sales | ||||||
Global Fixed Income | $ | 326,232 | $ | 511,795 | ||||
US Short Duration Fixed Income | 51,028,439 | 59,495,110 |
For the period ended June 30, 2019, the Portfolios did not engage in any cross-trades in accordance with Rule 17a-7 under the 1940 Act, and no brokerage commissions were paid to affiliates of the Investment Manager or other affiliates of the Fund for portfolio transactions executed on behalf of the Fund.
Semi-Annual Report 97
6. Line of Credit
The Fund has a $50 million Line of Credit Agreement (the “Agreement”) with State Street, primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. Interest on borrowings is payable at the higher of the Federal Funds rate or One-Month LIBOR rate plus 1.00%, on an annualized basis. Under the Agreement, the Fund has agreed to pay a 0.20% per annum fee on the unused portion of the commitment, payable quarterly in arrears. The Fund has also agreed to pay an upfront fee of 0.05% of the committed line amount. During the period ended June 30, 2019, the following Portfolios had borrowings under the Agreement as follows:
Number | ||||||||||||||||
Weighted | of Days | |||||||||||||||
Average | Maximum | Average | Borrowings | |||||||||||||
Daily Loan | Daily Loan | Interest | were | |||||||||||||
Portfolio | Balance | * | Outstanding | Rate | Outstanding | |||||||||||
Emerging Markets Debt | $ | 7,090,229 | $ | 39,280,000 | 3.50 | % | 35 | |||||||||
US Corporate Income | 687,500 | 790,000 | 3.51 | 2 |
* | For days borrowings were outstanding. |
Management believes that the fair value of the liabilities under the line of credit is equivalent to the recorded amount based on its short-term maturity and interest rate, which fluctuates with LIBOR. A Portfolio’s outstanding balance on the line of credit, if any, would be categorized as Level 2.
7. Investment Risks
(a) Non-US Securities Risk—A Portfolio’s performance will be influenced by political, social and economic factors affecting the non-US countries and companies in which the Portfolio invests. Non-US securities carry special risks, such as less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less liquidity.
(b) Emerging Market Risk—Emerging market countries generally have economic structures that are less diverse and mature, and political systems that are less stable, than those of developed
98 Semi-Annual Report
countries. The economies of countries with emerging markets may be based predominantly on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme debt burdens or volatile inflation rates. The securities markets of emerging market countries have historically been extremely volatile. These market conditions may continue or worsen. Investments in these countries may be subject to political, economic, legal, market and currency risks. The risks may include less protection of property rights and uncertain political and economic policies, the imposition of capital controls and/or foreign investment limitations by a country, nationalization of businesses and the imposition of sanctions by other countries, such as the US. Significant devaluation of emerging market currencies against the US dollar may occur subsequent to acquisition of investments denominated in emerging market currencies.
(c) Foreign Currency Risk—Investments denominated in currencies other than US dollars may experience a decline in value, in US dollar terms, due solely to fluctuations in currency exchange rates. A Portfolio’s currency investments could be adversely affected by delays in, or a refusal to grant, repatriation of funds or conversion of emerging market currencies. The Investment Manager generally does not intend to actively hedge the Portfolio’s foreign currency exposure.
(d) Fixed-Income and Debt Securities Risk—The market value of a debt security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The debt securities market can be susceptible to increases in volatility and decreases in liquidity. Liquidity can decline unpredictably in response to overall economic conditions or credit tightening.
Prices of bonds and other debt securities tend to move inversely with changes in interest rates. Typically, a rise in rates will adversely affect debt securities and, accordingly, will cause the value of a Portfolio’s investments in these securities to decline.
Semi-Annual Report 99
Interest rate risk is usually greater for fixed-income securities with longer maturities or durations. A rise in interest rates (or the expectation of a rise in interest rates) may result in periods of volatility, decreased liquidity and increased redemptions, and, as a result, the Portfolio may have to liquidate portfolio securities at disadvantageous prices. During periods of reduced market liquidity, a Portfolio may not be able to readily sell debt securities at prices at or near their perceived value. An unexpected increase in Portfolio redemption requests, including a single large request for a significant percentage of a Portfolio’s shares, which may be triggered by market turmoil or an increase in interest rates, could cause the Portfolio to sell its holdings at a loss or at undesirable prices and adversely affect the Portfolio’s share price and increase the Portfolio’s liquidity risk and/or Portfolio expenses. Economic and other developments can adversely affect debt securities markets.
A Portfolio’s investments in lower-rated, higher-yielding securities (“junk bonds”) are subject to greater credit risk than its higher-rated investments. Credit risk is the risk that the issuer will not make interest or principal payments, or will not make payments on a timely basis. Non-investment grade securities tend to be more volatile, less liquid and are considered speculative. If there is a decline, or perceived decline, in the credit quality of a debt security (or any guarantor of payment on such security), the security’s value could fall, potentially lowering a Portfolio’s share price. The prices of non-investment grade securities, unlike investment grade debt securities, may fluctuate unpredictably and not necessarily inversely with changes in interest rates. The prices of high yield securities can fall in response to negative news about the issuer or its industry, or the economy in general to a greater extent than those of higher-rated securities. The market for these securities may be less liquid and therefore these securities may be harder to value or sell at an acceptable price, especially during times of market volatility or decline.
Some fixed-income securities may give the issuer the option to call, or redeem, the securities before their maturity. If securities held by a Portfolio are called during a time of declining interest rates (which is typically the case when issuers exercise options to
100 Semi-Annual Report
call outstanding securities), the Portfolio may have to reinvest the proceeds in an investment offering a lower yield (and the Portfolio may not fully benefit from any increase in the value of its portfolio holdings as a result of declining interest rates).
Adjustable rate securities provide a Portfolio with a certain degree of protection against rises in interest rates, although such securities will participate in any declines in interest rates as well. Certain adjustable rate securities, such as those with interest rates that fluctuate directly or indirectly based on multiples of a stated index, are designed to be highly sensitive to changes in interest rates and can subject the holders thereof to extreme reductions of yield and possibly loss of principal. Certain fixed-income securities may be issued at a discount from their face value (such as zero coupon securities) or purchased at a price less than their stated face amount or at a price less than their issue price plus the portion of “original issue discount” previously accrued thereon,i.e., purchased at a “market discount.” The amount of original issue discount and/or market discount on certain obligations may be significant, and accretion of market discount together with original issue discount will cause a Portfolio to realize income prior to the receipt of cash payments with respect to these securities.
(e) Mortgage-Related and Asset-Backed Securities Risk—Mortgage-related securities are complex instruments, subject to both credit and prepayment risk, and may be more volatile and less liquid, and more difficult to price accurately, than more traditional debt securities. Although certain mortgage-related securities are guaranteed by a third party (such as a US Government agency or instrumentality with respect to government-related mortgage-backed securities) or otherwise similarly secured, the market value of the security, which may fluctuate, is not secured. Mortgage-related securities generally are subject to credit risks associated with the performance of the underlying mortgage properties. Prepayment risk can lead to fluctuations in value of the mortgage-related security which may be pronounced. As with other interest-bearing securities, the prices of certain mortgage-related securities are inversely affected by changes in interest rates. However, although the value of a mortgage-related security may decline
Semi-Annual Report 101
when interest rates rise, the converse is not necessarily true, since during periods of declining interest rates the mortgages underlying the security are more likely to be prepaid.
The risks of asset-backed securities are similar to those of mortgage-related securities. However, asset-backed securities present certain risks that are not presented by mortgage-related securities. Primarily, these securities may provide a Portfolio with a less effective security interest in the related collateral than do mortgage-related securities.
(f) Derivatives and Hedging Risk—Derivatives transactions, including those entered into for hedging purposes (i.e., seeking to protect Portfolio investments), may increase volatility, reduce returns, limit gains or magnify losses, perhaps substantially, particularly since most derivatives have a leverage component that provides investment exposure in excess of the amount invested. Over-the-counter swap agreements, forward currency contracts, writing or purchasing over-the-counter options on securities (including options on exchange-traded funds and exchange-traded notes), indexes and currencies and other over-the-counter derivatives transactions are subject to the risk of default by the counterparty and can be illiquid. Changes in liquidity may result in significant, rapid and unpredictable changes in the prices for derivatives. These derivatives transactions, as well as the exchange-traded futures and options in which certain Portfolios may invest, are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related index, commodity, interest rate, currency, security or other reference asset. As such, a small investment could have a potentially large impact on a Portfolio’s performance. Purchasing options will reduce returns by the amount of premiums paid for options that are not exercised. In fact, many derivatives may be subject to greater risks than those associated with investing directly in the underlying or other reference asset. Derivatives transactions incur costs, either explicitly or implicitly, which reduce returns, and costs of engaging in such transactions may outweigh any gains or any losses averted from hedging activities. Successful use of derivatives, whether for hedging or for other investment purposes, is subject to the Invest-
102 Semi-Annual Report
ment Manager’s ability to predict correctly movements in the direction of the relevant reference asset or market and, for hedging activities, correlation of the derivative instruments used with the investments seeking to be hedged. Use of derivatives transactions, even when entered into for hedging purposes, may cause a Portfolio to experience losses greater than if the Portfolio had not engaged in such transactions.
8. Contractual Obligations
The Fund enters into contracts in the normal course of business that contain a variety of indemnification provisions. A Portfolio’s maximum exposure under these arrangements is unknown. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.
9. Fair Value Measurements
Fair value is defined as the price that a Portfolio would receive to sell an asset, or would pay to transfer a liability, in an orderly transaction between market participants at the date of measurement. The Fair Value Measurements and Disclosures provisions of GAAP also establish a framework for measuring fair value, and a three-level hierarchy for fair value measurement that is based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer, broadly, to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions about the assumptions that market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances. The fair value measurement level within the fair value hierarchy for the assets and liabilities of the Fund is based on the lowest level of any input that is significant to the overall fair value measurement. The three-level hierarchy of inputs is summarized below:
Semi-Annual Report 103
● | Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities |
● | Level 2 – other significant observable inputs (including unadjusted quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.) |
● | Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities) |
Changes in valuation technique may result in transfers into or out of the current assigned level within the hierarchy.
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in these securities.
The following table summarizes the valuation of the Portfolios’ assets and liabilities by each fair value hierarchy level as of June 30, 2019:
Unadjusted | |||||||||||||||||
Quoted Prices in | |||||||||||||||||
Active Markets | Significant | ||||||||||||||||
for Identical | Other | Significant | |||||||||||||||
Assets | Observable | Unobservable | |||||||||||||||
and Liabilities | Inputs | Inputs | Balance as of | ||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | June 30, 2019 | |||||||||||||
Emerging Markets Debt Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Corporate Bonds* | $ | — | $ | 7,249,122 | $ | — | $ | 7,249,122 | |||||||||
Foreign Government Obligations* | — | 157,215,693 | — | 157,215,693 | |||||||||||||
Quasi Government Bonds* | — | 2,143,803 | — | 2,143,803 | |||||||||||||
Supranational Bonds | — | 2,222,620 | — | 2,222,620 | |||||||||||||
Short-Term Investments | 4,103,690 | — | — | 4,103,690 | |||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | — | 806,316 | — | 806,316 | |||||||||||||
Interest Rate Swap Agreements | — | 81,488 | — | 81,488 | |||||||||||||
Centrally Cleared Swap Agreements | — | 142,134 | — | 142,134 | |||||||||||||
Total | $ | 4,103,690 | $ | 169,861,176 | $ | — | $ | 173,964,866 | |||||||||
Liabilities: | |||||||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | $ | — | $ | (529,911 | ) | $ | — | $ | (529,911 | ) |
104 Semi-Annual Report
Unadjusted | |||||||||||||||||
Quoted Prices in | |||||||||||||||||
Active Markets | Significant | ||||||||||||||||
for Identical | Other | Significant | |||||||||||||||
Assets | Observable | Unobservable | |||||||||||||||
and Liabilities | Inputs | Inputs | Balance as of | ||||||||||||||
Description | (Level 1) | (Level 2) | (Level 3) | June 30, 2019 | |||||||||||||
Global Fixed Income Portfolio | |||||||||||||||||
Assets: | |||||||||||||||||
Corporate Bonds* | $ | — | $ | 1,876,802 | $ | — | $ | 1,876,802 | |||||||||
Foreign Government Obligations* | — | 2,804,758 | — | 2,804,758 | |||||||||||||
Quasi Government Bonds* | — | 95,968 | — | 95,968 | |||||||||||||
Supranational Bonds | — | 766,778 | — | 766,778 | |||||||||||||
US Municipal Bonds | — | 126,360 | — | 126,360 | |||||||||||||
US Treasury Securities | — | 481,221 | — | 481,221 | |||||||||||||
Short-Term Investments | 23,436 | — | — | 23,436 | |||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | — | 27,001 | — | 27,001 | |||||||||||||
Total | $ | 23,436 | $ | 6,178,888 | $ | — | $ | 6,202,324 | |||||||||
Liabilities: | |||||||||||||||||
Other Financial Instruments† | |||||||||||||||||
Forward Currency Contracts | $ | — | $ | (40,052 | ) | $ | — | $ | (40,052 | ) | |||||||
US Corporate Income Portfolio | |||||||||||||||||
Exchange-Traded Funds | $ | 8,042,058 | $ | — | $ | — | $ | 8,042,058 | |||||||||
Corporate Bonds* | — | 281,302,064 | — | 281,302,064 | |||||||||||||
Short-Term Investments | 2,476,235 | — | — | 2,476,235 | |||||||||||||
Total | $ | 10,518,293 | $ | 281,302,064 | $ | — | $ | 291,820,357 | |||||||||
US Short Duration Fixed Income Portfolio | |||||||||||||||||
Asset-Backed Securities | $ | — | $ | 7,431,991 | $ | — | $ | 7,431,991 | |||||||||
Corporate Bonds* | — | 34,879,901 | — | 34,879,901 | |||||||||||||
US Government Securities | — | 8,953,512 | — | 8,953,512 | |||||||||||||
US Treasury Securities | — | 46,735,006 | — | 46,735,006 | |||||||||||||
Short-Term Investments | 551,254 | — | — | 551,254 | |||||||||||||
Total | $ | 551,254 | $ | 98,000,410 | $ | — | $ | 98,551,664 |
10. Derivative Instruments
Certain Portfolios may use derivative instruments, including forward currency contracts or swap agreements.
Forward currency contracts may be used for hedging purposes or to seek to increase returns.
A Portfolio enters into swap agreements in an attempt to obtain a particular exposure when it is considered desirable to do so, possi-
Semi-Annual Report 105
bly at a lower cost to such Portfolio than if it had invested directly in the asset that yielded the desired exposure.
During the period ended June 30, 2019, the approximate average monthly notional exposure for derivative instruments was as follows:
During the period ended June 30, 2019, the approximate average monthly notional exposure for derivative instruments was as follows:
Emerging | Global | |||||||
Markets | Fixed | |||||||
Debt | Income | |||||||
Derivative Instruments | Portfolio | Portfolio | ||||||
Forward currency contracts: | ||||||||
Average amounts purchased | $ | 60,300,000 | $ | 2,500,000 | ||||
Average amounts sold | 55,700,000 | 2,400,000 | ||||||
Interest rate swap agreements: | ||||||||
Average notional value – receives fixed rate on centrally cleared | 4,800,000 | # | ||||||
Average notional value – receives fixed rate on OTC | 4,000,000 | * | — |
# | Represents average monthly notional exposure for the three month the derivative instrument was open during the period. |
* | Represents average monthly notional exposure for the four month the derivative instrument was open during the period. |
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Emerging Markets Debt Portfolio
Foreign | Interest | |||||||||||
Currency | Rate | |||||||||||
Assets – Derivative Financial Instruments | Contracts | Contracts | Total | |||||||||
Forward currency contracts | ||||||||||||
Unrealized appreciation on forward currency contracts | $ | 806,316 | $ | — | $ | 806,316 | ||||||
Swap agreements | ||||||||||||
Unrealized appreciation on centrally cleared swaps | — | 142,134 | 142,134 | |||||||||
Unrealized appreciation on OTC swaps | — | 81,488 | 81,488 | |||||||||
Total | $ | 806,316 | $ | 223,622 | $ | 1,029,938 |
106 Semi-Annual Report
Liabilities – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized depreciation on forward currency contracts | $ | 529,911 |
Global Fixed Income Portfolio
Assets – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized appreciation on forward currency contracts | $ | 27,001 |
Liabilities – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized depreciation on forward currency contracts | $ | 40,052 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Emerging Markets Debt Portfolio
Net Realized Gain (Loss) from: | Foreign Currency Contracts | Interest Rate Contracts | Total | |||||||||
Forward currency contracts | $ | 100,729 | $ | — | $ | 100,729 | ||||||
Swap agreements | — | 189 | 189 | |||||||||
Total | $ | 100,729 | $ | 189 | $ | 100,918 |
Net Change in Unrealized Appreciation (Depreciation) on: | Foreign Currency Contracts | Interest Rate Contracts | Total | |||||||||
Forward currency contracts | $ | (430,911 | ) | $ | — | $ | (430,911 | ) | ||||
Swap agreements | — | 223,622 | 223,622 | |||||||||
Total | $ | (430,911 | ) | $ | 223,622 | $ | (207,289 | ) |
Global Fixed Income Portfolio
Net Realized Gain (Loss) from: | Total | |||
Forward currency contracts | $ | 4,381 | ||
Net Change in Unrealized Appreciation (Depreciation) on: | Total | |||
Forward currency contracts | $ | (45,154 | ) |
Semi-Annual Report 107
None of the other Portfolios presented traded in derivative instruments during the period ended June 30, 2019.
As of June 30, 2019, the Emerging Markets Debt and Global Fixed Income Portfolios held derivative instruments that are eligible for offset in the Statements of Assets and Liabilities and are subject to master netting arrangements. A master netting arrangement is an agreement between two counterparties who have multiple contracts with each other that provides for the net settlement of all contracts, as well as any cash collateral, through a single payment in the event of default on, or termination of, any one contract.
The required information for the affected Portfolios are presented in the below table, as of June 30, 2019:
Emerging Markets Debt Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | |||||||||||||
Forward Currency Contracts | $ | 806,316 | $ | — | $ | 806,316 | ||||||||||
Interest Rate Swap Agreements | 81,488 | — | 81,488 | |||||||||||||
Total | $ | 887,804 | $ | — | $ | 887,804 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received (a) | Net Amounts of Derivative Assets | ||||||||||||||
Bank of America NA | $ | 108,573 | $ | (7,226 | ) | $ | (60,000 | ) | $ | 41,347 | ||||||||
Barclays Bank PLC | 141,959 | (141,959 | ) | — | — | |||||||||||||
Citibank NA | 50,787 | (12,419 | ) | — | 38,368 | |||||||||||||
Goldman Sachs International | 84,370 | (5,311 | ) | — | 79,059 | |||||||||||||
HSBC Bank USA NA | 96,787 | (96,787 | ) | — | — | |||||||||||||
JPMorgan Chase Bank NA | 59,638 | (59,638 | ) | — | — | |||||||||||||
Standard Chartered Bank | 264,458 | (52,493 | ) | — | 211,965 | |||||||||||||
UBS AG | 81,232 | (23,336 | ) | — | 57,896 | |||||||||||||
Total | $ | 887,804 | $ | (399,169 | ) | $ | (60,000 | ) | $ | 428,635 |
108 Semi-Annual Report
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||||
Forward Currency Contracts | $ | 529,911 | $ | — | $ | 529,911 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
Bank of America NA | $ | 7,226 | $ | (7,226 | ) | $ | — | $ | — | |||||||||
Barclays Bank PLC | 204,144 | (141,959 | ) | — | 62,185 | |||||||||||||
Citibank NA | 12,419 | (12,419 | ) | — | — | |||||||||||||
Goldman Sachs International | 5,311 | (5,311 | ) | — | — | |||||||||||||
HSBC Bank USA NA | 152,299 | (96,787 | ) | — | 55,512 | |||||||||||||
JPMorgan Chase Bank NA | 72,683 | (59,638 | ) | — | 13,045 | |||||||||||||
Standard Chartered Bank | 52,493 | (52,493 | ) | — | — | |||||||||||||
UBS AG | 23,336 | (23,336 | ) | — | — | |||||||||||||
Total | $ | 529,911 | $ | (399,169 | ) | $ | — | $ | 130,742 |
(a) | Collateral amounts disclosed in the table above may be adjusted due to the requirement to limit collateral amounts to avoid the effect of over-collateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein. |
Global Fixed Income Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | |||||||||||||
Forward Currency Contracts | $ | 27,001 | $ | — | $ | 27,001 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received | Net Amounts of Derivative Assets | ||||||||||||||
Citibank NA | $ | 6,323 | $ | (6,323 | ) | $ | — | $ | — | |||||||||
HSBC Bank USA NA | 17,771 | (17,771 | ) | — | — | |||||||||||||
JPMorgan Chase Bank NA | 2,295 | (2,295 | ) | — | — | |||||||||||||
Morgan Stanley Capital Services LLC. | 612 | (141 | ) | — | 471 | |||||||||||||
Total | $ | 27,001 | $ | (26,530 | ) | $ | — | $ | 471 |
Semi-Annual Report 109
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | |||||||||||||
Forward Currency Contracts | $ | 40,052 | $ | — | $ | 40,052 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged (a) | Net Amounts of Derivative Liabilities | ||||||||||||||
Citibank NA | $ | 6,461 | $ | (6,323 | ) | $ | — | $ | 138 | |||||||||
HSBC Bank USA NA | 23,153 | (17,771 | ) | — | 5,382 | |||||||||||||
JPMorgan Chase Bank NA | 10,297 | (2,295 | ) | — | 8,002 | |||||||||||||
Morgan Stanley Capital Services LLC. | 141 | (141 | ) | — | — | |||||||||||||
Total | $ | 40,052 | $ | (26,530 | ) | $ | — | $ | 13,522 |
11. Accounting Pronouncements
In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-08, Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities, which amends the amortization period for certain purchased callable debt securities. Management has evaluated the impact of the amendments and has adopted these amendments and incorporated the changes in the current financial statements and related disclosures. For public business entities, the amendments in this ASU became effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018.
In August 2018, the FASB issued ASU 2018-13,Fair Value Measurement (Topic 820): Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement,which removes, modifies and adds disclosures to Topic 820. The amendments in this ASU apply to all entities that are required, under existing GAAP, to make disclosures about recurring or nonrecurring fair value measurements. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is
110 Semi-Annual Report
permitted. Management has evaluated the impact of the amendments and has elected to adopt these amendments and incorporate the changes in the current financial statements.
12. Subsequent Events
Management has evaluated subsequent events affecting the Portfolios through the issuance of the financial statements and has determined that there were no subsequent events that required adjustment or disclosure.
Semi-Annual Report 111
The Lazard Funds, Inc.
Board of Directors and Officers Information (unaudited)
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Independent Directors(3): | ||||
Franci J. Blassberg (1953) | Director (August 2014) | Debevoise & Plimpton LLP, a law firm,Of Counsel(2013 – present)
Cornell Law School,AdjunctProfessor(2013 – 2016, 2019)
The Buchmann Faculty of Law, Tel Aviv University,Visiting Professor(2019)
University of California, Berkeley School of Law,Adjunct Professor (Spring 2017) | ||
Kenneth S. Davidson (1945) | Director (August 1995) | Davidson Capital Management Corporation, an investment manager,President (1978 – present)
Landseer Advisors LLC, an investment manager,Senior Advisor(2012 – 2014) | ||
Nancy A. Eckl (1962) | Director (April 2007) | College Retirement Equities Fund (eight accounts),Trustee(2007 – present)
TIAA-CREF Funds (69 funds) and TIAA-CREF Life Funds (11 funds),Trustee(2007 – present)
TIAA Separate Account VA-1,Member of the Management Committee(2007 – present) | ||
Trevor W. Morrison (1971) | Director (April 2014) | New York University School of Law,Dean and Eric M. and Laurie B.Roth Professor of Law (2013 – present)
Columbia Law School,Professorof Law(2008 – 2013) | ||
Richard Reiss, Jr. (1944) | Director (May 1991) | Georgica Advisors LLC, an investment manager,Chairman(1997 – present)
Resource America, Inc., a real estate asset management company,Director(2016 – 2018) |
112 Semi-Annual Report
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Robert M. Solmson (1947) | Director (September 2004) | Fairwood Capital, LLC, a private investment corporation engaged primarily in real estate and hotel investments,Co-ManagingPartner and Managing Director (2008 – present) | ||
Interested Directors(4): | ||||
Ashish Bhutani (1960) | Director (July 2005) | Investment Manager,ChiefExecutive Officer(2004 – present)
Lazard Ltd,Vice Chairman andDirector(2010 – present) | ||
Nathan A. Paul (1973) | Director (October 2017), Chief Executive Officer and President (February 2017; previously, Vice President and Secretary since April 2002) | Investment Manager,ChiefBusiness Officer (April 2017 – present) andManaging Director (2003 – present)
Investment Manager,GeneralCounsel(2002 – April 2017) |
(1) | The address of each Director of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each Director serves as a Director for each of the funds in the Lazard Fund Complex (comprised of, as of July 31, 2019, 39 active investment portfolios). Each Director serves an indefinite term, until his or her successor is elected, and each Director serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | “Independent Directors” are not “interested persons” (as defined in the 1940 Act) of the Fund. |
(4) | Messrs. Bhutani and Paul are “interested persons” (as defined in the 1940 Act) of the Fund because of their positions with the Investment Manager. |
The Fund’s Statement of Additional Information contains further information about the Directors and is available without charge by calling 800-823-6300, or online, at www.lazardassetmanagement.com.
Semi-Annual Report 113
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) During the Past Five Years | ||
Officers(3): | ||||
Mark R. Anderson (1970) | Chief Compliance Officer (September 2014), Vice President and Secretary (February 2017) | Managing Director (since February 2017, previously Director), Chief Compliance Officer (since September 2014) and General Counsel (since April 2017) of the Investment Manager
Senior Vice President, Counsel and Deputy Chief Compliance Officer of AllianceBernstein L.P. (2004 – August 2014)
Assurance Manager at PricewaterhouseCoopers LLP (2008 – November 2015) | ||
Christopher Snively (1984) | Chief Financial Officer (March 2016) | Senior Vice President of the Investment Manager (since November 2015)
Assurance Manager at PricewaterhouseCoopers LLP (2008 – November 2015) | ||
Stephen St. Clair (1958) | Treasurer (May 2003) | Vice President of the Investment Manager | ||
Shari L. Soloway (1981) | Assistant Secretary (November 2015) | Head of Legal, North America (since January 2019, previously Senior Vice President, Legal and Compliance (since September 2015)) of the Investment Manager
Vice President and Associate General Counsel of GE Asset Management (July 2011 – September 2015) | ||
Jessica A. Falzone (1989) | Assistant Secretary (January 2019) | Vice President, Legal and Compliance, of the Investment Manager (since March 2018)
Associate at Schulte Roth & Zabel LLP (2014 – March 2018) | ||
Cesar A. Trelles (1975) | Assistant Treasurer (December 2004) | Vice President of the Investment Manager |
(1) | The address of each officer of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each officer serves for an indefinite term, until his or her successor is elected and qualifies or until his or her earlier resignation or removal. Each officer serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | In addition to Nathan A. Paul, Chief Executive Officer and President (since February 2017; previously, Vice President and Secretary since April 2002), whose information is included in the Interested Directors section above. |
114 Semi-Annual Report
The Lazard Funds, Inc.Tax and Other Information (unaudited)
Proxy Voting
A description of the policies and procedures used to determine how proxies relating to Fund portfolio securities are voted is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the Securities and Exchange Commission (the “SEC”) website at https://www.sec.gov.
The Fund’s proxy voting record for the most recent 12-month period ended June 30 is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov. Information as of June 30 each year will generally be available by the following August 31.
Schedule of Portfolio Holdings
The Fund files its complete schedule of each Portfolio’s holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT reports are available on the SEC’s website at https://www.sec.gov.
Board Consideration of Management Agreement
At meetings of the Board held on May 22, 2019 and June 5, 2019, the Board considered the approval, for an additional annual period, of the Management Agreement between the Fund, on behalf of the Portfolios, and the Investment Manager. The Independent Directors were assisted in their review by independent legal counsel, who advised the Board on relevant legal standards and met with the Independent Directors in executive sessions separate from representatives of the Investment Manager.
Representatives of the Investment Manager discussed with the Board the Investment Manager’s written materials provided in advance of the meetings, including, at the June 5, 2019 meeting, additional information requested by the Independent Directors at the May 22, 2019 meeting.
Services Provided
The Investment Manager’s materials addressed, among other matters, the nature, extent and quality of services that the Investment
Semi-Annual Report 115
Manager provides the Fund, including a discussion of the Investment Manager and its clients (of which the Lazard Funds complex of 39 active funds comprised approximately $29 billion of the approximately $235 billion of total assets under the management of the Investment Manager and its global affiliates as of March 31, 2019).
The Board considered the various services provided by the Investment Manager including the Investment Manager’s research, portfolio management and trading capabilities and oversight of day-to-day operations, including supervision of fund accounting and administration-related services and assistance in meeting legal and regulatory requirements, as well as regular reporting to, and support of, the Board. The Investment Manager’s representatives stated that the Investment Manager believes that the Fund and its shareholders continue to be able to obtain significant benefits as a result of the resources and support of the Investment Manager’s global research, portfolio management, trading, operations, risk management, technology and legal and compliance infrastructure. The Board also considered information provided by the Investment Manager regarding its personnel, resources, financial condition and experience; the Fund’s distribution channels and the relationships with various intermediaries; marketing and shareholder servicing activities on behalf of the Portfolios; and Portfolio asset flows and the growth or decline in asset levels. The Board accepted the assertion of representatives of the Investment Manager that the Fund benefits from the services and infrastructure provided by the Investment Manager and that such services and infrastructure are greater than those typically provided to a $29 billion fund complex not managed by a large, global firm such as the Investment Manager.
Comparative Fee, Expense Ratio and Performance Information
The Board reviewed information prepared by Strategic Insight, an independent provider of investment company data, comparing, for the fiscal year ended December 31, 2018, each Portfolio’s:
• | contractual management fee (i.e., without giving effect to any fee waivers), referred to in the Strategic Insight materials as “advisor fee,” expense ratio (net of any fee waivers or expense reimburse- |
116 Semi-Annual Report
ments) and performance (for one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to those of a group of comparison funds selected by Strategic Insight (a “Group”); | |
• | advisor fee and expense ratio to a broader group of funds based on the Portfolio’s Morningstar category (an “Expense Universe”); and |
• | performance (for the one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to that of the funds in the Portfolio’s Morningstar category (a “Category”) and the benchmark index and the Portfolio’s performance for each of the four most recently completed calendar years, as applicable, and the first quarter of 2019, to that of the funds in the Portfolio’s Category and the benchmark index. |
The Strategic Insight materials outlined the process of construction of the Groups, Expense Universes and Categories, and representatives of the Investment Manager and independent legal counsel had previously discussed with the Board in further detail the methodologies used by Strategic Insight in constructing the Groups, Expense Universes and Categories, including how the methodologies could affect the results of the comparisons.
Advisor Fees and Expense Ratios.Representatives of the Investment Manager discussed the results of the Strategic Insight advisor fee and expense ratio comparisons with the Board, which showed that the advisor fees and expense ratios of the Portfolios were competitive within each Portfolio’s respective Group. The Board considered the comparisons, additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager and that the Investment Manager continues to voluntarily enter into expense limitation agreements for all of the Portfolios, pursuant to which the Investment Manager currently was waiving advisor fees and/or reimbursing expenses.
As applicable, the Board also considered fees paid to the Investment Manager by any funds advised or sub-advised by the Investment Manager utilizing the same investment strategies as the Portfolios, as well as any separately managed accounts of the
Semi-Annual Report 117
Investment Manager with similar investment objectives, policies and strategies (for each Portfolio, collectively with such funds, “Similar Accounts”). Representatives of the Investment Manager discussed the nature of the Similar Accounts and the significant differences in services provided by the Investment Manager to the different types of Similar Accounts as compared to the services provided to the Portfolios. The Board considered the relevance of the fee information provided for Similar Accounts, in light of the Investment Manager’s discussion of the significant differences in services provided, to evaluate the fees paid to the Investment Manager by the Portfolios.
Performance.When evaluating the performance of each Portfolio, the Board considered Strategic Insight’s performance analysis along with other information provided by the Investment Manager, including additional performance information, as well as additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager. The Board also received and would continue to receive regular updates and/or additional information (as requested by the Board) from the Investment Manager in respect of the Portfolios’ relative underperformance compared to the relevant Group.
Investment Manager Profitability and Economies of Scale
The Board reviewed information prepared by the Investment Manager for each Portfolio concerning the estimated profitability percentage of the Management Agreement to the Investment Manager and its affiliates for the calendar year ended December 31, 2018 and the Investment Manager’s cost allocation methodology to compute an estimate of each Portfolio’s costs to the Investment Manager. The Investment Manager’s representatives stated that neither the Investment Manager nor its affiliates receive any significant indirect benefits from the Investment Manager acting as investment manager to the Portfolios. The representatives of the Investment Manager reminded the Board that the Investment Manager is continuing to support distribution relationships through direct payments from its or its affiliates’ own resources to third parties in connection with distribution and shareholder servicing and/or administrative and recordkeeping services, and noted
118 Semi-Annual Report
that the Fund does not bear any related costs other than the 0.25% 12b-1 fee pursuant to the Distribution and Servicing Plan adopted for the Portfolios’ Open Shares.
The profitability percentages were within ranges determined by relevant court cases not to be so disproportionately large that they bore no reasonable relationship to the services rendered. The Board (1) considered the Investment Manager’s estimated profitability with respect to each Portfolio as part of their evaluation of the Portfolio’s fee under the Management Agreement, considered in relation to the mix of services provided by the Investment Manager (including the nature, extent and quality of such services), and (2) evaluated the profitability in light of the relevant circumstances for each Portfolio. Representatives of the Investment Manager and the Board discussed ways economies of scale could be realized and how they could be shared, including the Investment Manager’s reinvestment of profits back into its business, waiving or reducing Portfolio management fees and/or reimbursing expenses, adding discounts to a Portfolio’s management fee schedule as a Portfolio’s assets increase or by instituting management fees at inception that account for future scale. It was noted that each Portfolio had declining or generally stable assets, and/or a low level of assets, over the past calendar year so that the potential that the Investment Manager may have realized any economies of scale was reduced.
At the conclusion of these discussions, the Board expressed the opinion that it had been furnished with such information as may reasonably be necessary to make an informed business decision with respect to evaluation of the renewal of the Management Agreement. Based on its discussions and considerations as described above, with the assistance of independent legal counsel and in the exercise of its business judgment, the Board made the following conclusions and determinations.
• | The Board concluded that the nature, extent and quality of the services provided by the Investment Manager are adequate and appropriate, noting the benefits of the significant services and infrastructure associated with an approximately $235 billion global asset management business. |
Semi-Annual Report 119
• | The Board concluded that each Portfolio’s fee paid to the Investment Manager was appropriate under the circumstances and in light of the factors and the totality of the services provided. |
• | The Board, after considering the information provided and the totality of the relevant circumstances for each Portfolio, accepted the Investment Manager’s explanation that the Portfolio was performing in accordance with expectations or that the Investment Manager was taking steps intended to improve performance and the Board would continue to monitor performance. |
• | The Board recognized that economies of scale may be realized, particularly as the assets of the Portfolios increase and determined that they would continue to consider potential material economies of scale. |
In evaluating the Management Agreement, the Board relied on the information described above, in addition to information provided by the Investment Manager throughout the year relating to the operations of the Fund and the investment management and other services provided under the Management Agreement, including information on the investment performance of the Portfolios in comparison to similar mutual funds and benchmark performance indices over various time periods; general market outlook as applicable to the Portfolios; and compliance reports. The Board also relied on its previous knowledge, gained through meetings and other interactions with the Investment Manager, of the Investment Manager and the services provided to the Fund by the Investment Manager. The Board considered these conclusions and determinations in their totality and determined to approve the Fund’s Management Agreement for each Portfolio. In deciding whether to vote to approve the Management Agreement for each Portfolio, each Director may have accorded different weights to different factors so that each Director may have had a different basis for his or her decision.
120 Semi-Annual Report
The Lazard Funds, Inc.
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
https://www.lazardassetmanagement.com
Investment Manager
Lazard Asset Management LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
Distributor
Lazard Asset Management Securities LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Custodian
State Street Bank and Trust Company
One Iron Street
Boston, Massachusetts 02210
Transfer Agent and Dividend Disbursing Agent
DST Asset Manager Solutions, Inc.
2000 Crown Colony Drive
Quincy, Massachusetts 02169
Telephone: 617-483-7000
Independent Registered Public Accounting Firm
Deloitte & Touche LLP
30 Rockefeller Plaza
New York, New York 10112-0015
Legal Counsel
Proskauer Rose LLP
Eleven Times Square
New York, New York 10036-8299
http://www.proskauer.com
Lazard Asset Management LLC•30 Rockefeller Plaza•New York, NY 10112• www.lazardassetmanagement.com | ||
Performance information as of the most recent month end is available online at www.lazardassetmanagement.com.
LZDPS026 | We Recycle This document is printed on recycled paper. |
Lazard Funds
Semi-Annual Report
June 30, 2019
Multi-Asset Funds
Lazard Global Dynamic Multi-Asset Portfolio
Lazard Opportunistic Strategies Portfolio
Lazard Real Assets and Pricing Opportunities Portfolio
Important Information on Paperless Delivery
Beginning on January 1, 2021, as permitted by regulations adopted by the Securities and Exchange Commission, paper copies of the Fund’s shareholder reports like this one will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. Shareholders who hold accounts directly with the Fund may elect to receive shareholder reports and other communications from the Fund electronically by signing up for paperless delivery at www.icsdelivery.com/lazardassetmanagement. If you own these shares through a financial intermediary, you may contact your financial intermediary.
You may elect to receive all future reports in paper free of charge.You can inform the Fund that you wish to continue receiving paper copies of your shareholder reports by following the instructions included with this disclosure and visiting www.fundreports.com. If you own these shares through a financial intermediary, you may contact your financial intermediary or follow instructions included with this disclosure to elect to continue to receive paper copies of your shareholder reports.Your election to receive reports in paper will apply to all funds held with the fund complex or your financial intermediary.
PRIVACY NOTICE
WHAT DOES LAZARD DO WITH YOUR PERSONAL INFORMATION?
Financial companies choose how they share your personal information. U.S. federal law gives our clients the right to limit some but not all sharing. U.S. federal and other applicable law also requires us to tell you how we collect, share, and protect your personal information. Please read this notice carefully to understand what we do.
We do not disclose nonpublic personal information about our clients or former clients to third parties other than as described below.
Personal information we collect.We collect personal information about you in connection with our providing advisory services to you. The legal basis for our collection of your personal information is our contract with you and our legitimate business interest to provide contractual services to you. The collection of this information is necessary for us to be able to provide advisory services to you and the failure to provide such information will result in our inability to provide our services. This information includes your social security number (for U.S. persons) and may include other information such as your:
● | Assets and income; | |
● | Investment experience; | |
● | Transaction history; | |
● | Credit history; and | |
● | Wire transfer instructions. |
How we collect this information.We collect this information from you through various means. For example, when you give us your contact information, enter into an investment advisory contract with us, buy securities (i.e., interests in a fund) from us, direct us to buy or sell securities for your account, tell us where to send money, or make a wire transfer. We also may collect your personal information from other sources, such as our affiliates1 or other non-affiliated companies (such as credit bureaus).
1 | Our affiliates are companiesrelated to us by common ownership or control and can include both financial and nonfinancial companies. Non-affiliates are companiesnot related to us by common ownership or control and can include both financial and nonfinancial companies. |
How we use this information.All financial companies need to share customers’ personal information to run their everyday business and we use the personal information we collect from you for our everyday business purposes. These purposes may include for example:
● | To provide advisory services to you; | |
● | To open an account for you; | |
● | To process a transaction for your account; | |
● | To market products and services to you; and/or | |
● | To respond to court orders and legal investigations. |
If you are an investor located within a European Union country, please note that personal information may be collected, shared and/or stored outside of the European Union.
Disclosure to others.We may provide your personal information to our affiliates and to firms that assist us in servicing your account and have a need for such information, such as a broker, counterparty, fund administrator or third party service provider that aggregates data in a central repository for access by a broker, counterparty or fund administrator to provide its services. We may also disclose such information to service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you. We require third party service providers and financial institutions with which we have a formal agreement to provide services relating to our arrangements with you to protect the confidentiality of your information and to use the information only for the purposes for which we disclose the information to them. These sharing practices are consistent with applicable privacy and related laws, and in general, you may not limit our use of your personal information for these purposes under such laws. We note that the U.S. federal privacy laws only give you the right to limit the certain types of information sharing that we do not engage in (e.g., sharing with our affiliates certain information relating to your transaction history or creditworthiness for their use in marketing to you, or sharing any personal information with non-affiliates for them to market to you). We may also share your personal information with non-affiliates (such as a government agency or regulatory authority) as required by applicable law.
How we protect your personal information.To protect your personal information from unauthorized access and use, we use security measures that comply with applicable law. These measures include computer safeguards and secured files and buildings.
How long we keep your personal information.We retain your personal information for the duration of your advisory relationship with us and for a period of time thereafter as required by applicable law.
Your rights with respect to this information.If you are an investor located within a European Union country, you have the following rights with respect to your personal information:
● | The right to request and obtain a copy of your personal information that we maintain; | |
● | The right to correct your personal information that we maintain; | |
● | The right to request the erasure of your personal information from our systems, subject to applicable recordkeeping requirements applicable to us; and | |
● | The right to lodge a complaint with a supervisory authority. |
Who is providing this Privacy Notice.This Privacy Notice relates to the following entities:
● | Lazard Asset Management LLC | |
● | Lazard Asset Management (Canada), Inc.2 | |
● | Lazard Asset Management Securities LLC |
Who to contact with questions.If you have any questions about this Privacy Notice, please call (800) 823-6300 or visit our website at http://www.lazardassetmanagement.com.
2 | Lazard Asset Management (Canada), Inc. does not disclose any non-public personal information about its customers to any third party, except as permitted by or required by any applicable law, including the laws of the United States and Canada. |
The Lazard Funds, Inc.Table of Contents
Please consider a Portfolio’s investment objectives, risks, charges and expenses carefully before investing. For more complete information about The Lazard Funds, Inc. (the “Fund”), you may obtain a prospectus or summary prospectus by calling 800-823-6300, or online, at www.lazardassetmanagement.com. Read the prospectus or each Portfolio’s summary prospectus carefully before you invest. The prospectus and each Portfolio’s summary prospectus contain the investment objectives, risks, charges, expenses and other information about each Portfolio of the Fund, which are not detailed in this report.
Distributed by Lazard Asset Management Securities LLC.
Semi-Annual Report 1
The Lazard Funds, Inc.A Message from Lazard (unaudited)
Dear Shareholder,
Global markets registered strong gains in the first half of 2019. They reached near-record highs in April, thanks to strong corporate earnings and better-than-expected quarterly US GDP growth. However, heightened trade tensions and mixed economic data gave investors pause in May as China and the United States again raised tariffs on each other’s imports after trade talks stalled.
The US equity market rose strongly during the period, boosted by hopes that renewed trade negotiations and a potential interest rate cut by the Federal Reserve in July would keep the United States on strong economic footing. Financials, materials, and technology outperformed, while energy lagged against a backdrop of falling oil prices, concerns about global demand, and rising inventories. Volatility as measured by the CBOE Volatility Index (VIX) rose mildly but remained well below levels at the end of 2018.
European equity markets have been caught in the middle of opposing forces, mainly growing tensions around global trade and increasingly dovish central banks. This has pushed European government bond yields to fresh lows and caused bond-sensitive sectors to climb higher, further stretching valuations.
Emerging markets equities gained more than 10% year to date. The asset class’s performance was volatile over the latter half of the period, reflecting extraordinary uncertainty among investors about the geopolitical environment, particularly US actions on trade in May and early June. Emerging markets debt also delivered strong year-to-date returns, supported by liquidity from central banks. However, the global growth outlook has become more uncertain and current valuations provide less compensation for the increased risks.
In this environment, we believe it is becoming increasingly important for investors to be discerning, to focus on fundamentals and not short-term macro drivers, particularly as sentiment is vulnerable to rapid shifts. We are privileged that you have turned to Lazard
2 Semi-Annual Report
for your investment needs and value your continued confidence in our investment management capabilities.
Sincerely,
Lazard Asset Management LLC
Semi-Annual Report 3
The Lazard Funds, Inc.Performance Overviews (unaudited)
Lazard Global Dynamic Multi-Asset Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Global Dynamic Multi-Asset Portfolio, MSCI®World Index and GDMA Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Since Inception† | ||||||||
Institutional Shares** | 5.42 | % | 8.09 | % | |||||
Open Shares** | 5.17 | % | 7.78 | % | |||||
MSCI World Index | 6.33 | % | 10.93 | % | |||||
GDMA Index | 6.47 | % | 6.84 | % |
† | The inception date for the Portfolio was May 27, 2016. |
Lazard Opportunistic Strategies Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Opportunistic Strategies Portfolio, MSCI World Index and Global Asset Allocation Blended Index*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Five Years | Ten Years | |||||||||||
Institutional Shares** | –0.50 | % | 3.27 | % | 6.25 | % | |||||||
Open Shares** | –0.71 | % | 2.89 | % | 5.87 | % | |||||||
MSCI World Index | 6.33 | % | 6.60 | % | 10.72 | % | |||||||
Global Asset Allocation Blended Index | 7.41 | % | 5.29 | % | 8.22 | % |
4 Semi-Annual Report
Lazard Real Assets and Pricing Opportunities Portfolio
Comparison of Changes in Value of $10,000 Investment in the Institutional Shares of Lazard Real Assets and Pricing Opportunities Portfolio, MSCI World Index, 70% MSCI World (USD Hedged) Index | 30% Barclays World Inflation-Linked Bond (USD Hedged) Index and Real Assets Custom Index (USD Hedged)*
Average Annual Total Returns*
Periods Ended June 30, 2019
One Year | Since Inception† | ||||
Institutional Shares** | 3.52% | 4.90% | |||
Open Shares** | 3.18% | 4.52% | |||
MSCI World Index | 6.33% | 11.31% | |||
(Institutional | |||||
Shares) | |||||
10.78% | |||||
(Open Shares) | |||||
Real Assets Custom Index | 7.45% | 7.69% | |||
(Institutional | |||||
Shares) | |||||
7.58% | |||||
(Open Shares) | |||||
70% MSCI World (US Hedged) Index | 30% Barclays World Inflation-Linked Bond (USD Hedged) Index | 7.73% | 9.34% | |||
(Institutional | |||||
Shares) | |||||
9.02% | |||||
(Open Shares) | |||||
† The inception date for the Institutional Shares was December 30, 2016 and for the Open Shares was January 9, 2017. |
Notes to Performance Overviews:
* | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by Lazard Asset Management LLC, the Fund’s investment manager (the “Investment Manager”), State Street Bank and Trust Company, the Fund’s administrator (“State Street”) or DST Asset Manager Solutions, Inc., the Fund’s transfer and dividend distributing agent (“DST”); without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. |
Performance results do not include adjustments made for financial reporting purposes |
Semi-Annual Report 5
in accordance with US Generally Accepted Accounting Principles, if any, and may differ from amounts reported in the financial highlights.
The performance quoted represents past performance. Current performance may be lower or higher than the performance quoted. Past performance is not indicative, or a guarantee, of future results; the investment return and principal value of the Portfolio will fluctuate, so that Portfolio shares, when redeemed, may be worth more or less than their original cost. Within the longer periods illustrated there may have been short-term fluctuations, counter to the overall trend of investment results, and no single period of any length may be taken as typical of what may be expected in future periods. The graph and table above do not reflect the deduction of taxes that a shareholder would pay on the Portfolio’s distributions or the redemption of Portfolio shares.
The performance data of the indices have been prepared from sources and data that the Investment Manager believes to be reliable, but no representation is made as to their accuracy. The indices are unmanaged, have no fees or costs and are not available for investment.
The MSCI World Index is a free-float-adjusted market capitalization index that is designed to measure global developed markets equity performance. The MSCI World Index consists of 23 developed markets country indices.
The GDMA Index is a blended index constructed by the Investment Manager that is comprised of 50% MSCI World Index and 50% Bloomberg Barclays Global Aggregate®Index and is rebalanced monthly. The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of global investment-grade fixed-income debt markets, including government-related debt, corporate debt, securitized debt and global Treasury.
The Global Asset Allocation Blended Index is a blended index constructed by the Investment Manager that is comprised of 60% MSCI World Index and 40% Bloomberg Barclays US Aggregate Index and is rebalanced quarterly. The Bloomberg Barclays US Aggregate Index covers the investment-grade, US dollar-denominated, fixed-rate taxable bond market, including Treasuries, government-related and corporate securities, mortgage-backed securities, asset-backed securities, and commercial mortgage-backed securities, with maturities of no less than one year.
The 70% MSCI World (USD Hedged) Index | 30% Barclays World Inflation-Linked Bond (USD Hedged) Index, formerly referred to as the Real Assets Index, (USD Hedged), is an unmanaged index created by the Investment Manager, which is the performance of the 70% MSCI World Index (USD Hedged) and the 30% Bloomberg Barclays World Government Inflation-Linked Bond®Index (USD Hedged). The Bloomberg Barclays World Government Inflation-Linked Bond Index (USD Hedged) measures the performance of investment grade, government inflation-linked debt from 12 different developed markets countries.
The Real Assets Custom Index is an unmanaged index created by the Investment Manager, and is comprised of 20% MSCI World (Net) Index, 20% MSCI World Core Infrastructure USD Hedged Index, 20% MSCI ACWI IMI Core Real Estate Index, 20% Bloomberg Barclays Commodity Total Return Index and 20% Bloomberg Barclays World Government Inflation-Linked 1-10 Year USD Hedged Index. The MSCI World Index is a free-float-adjusted market capitalization index that is designed to measure global developed market equity performance. The MSCI World Index consists of 23 developed market country indices. The MSCI World Core Infrastructure Index captures large and mid-cap securities across the 23 developed market countries. The Infrastructure Index is designed to represent the performance of listed companies within the developed markets that are engaged in core industrial infrastructure activities. Note that Lazard Infrastructure invests in a range of companies globally, not specifically developed markets countries. The MSCI ACWI IMI Core Real Estate Index is a
6 Semi-Annual Report
free float-adjusted market capitalization index that consists of large, mid and small-cap stocks across 23 developed markets and 26 emerging markets countries engaged in the ownership, development and management of specific core property type real estate. The index excludes companies, such as real estate services and real estate financing companies, that do not own properties. The Bloomberg Commodity Total Return index is composed of futures contracts and reflects the returns on a fully collateralized investment in the BCOM. This combines the returns of the BCOM with the returns on cash collateral invested in 13 week (3 Month) U.S. Treasury Bills. The Bloomberg Barclays World Government Inflation-Linked Bond 1-10 Year Index measures the performance of investment grade, government inflation-linked debt from 12 different developed market countries. The indices are unmanaged and have no fees. One cannot invest directly in an index. The Portfolio considers the Real Assets Index to be a more suitable benchmark to compare the Portfolio’s performance given the Portfolio’s investment policies than the 70% MSCI World (USD Hedged) Index | 30% Barclays World Inflation-Linked Bond (USD Hedged) Index.
** | The performance of Institutional Shares and Open Shares may vary, primarily based on the differences in fees borne by shareholders investing in different classes. |
Semi-Annual Report 7
Information About Your Portfolio’s Expenses (unaudited)
Expense Example
As a shareholder in a Portfolio of the Fund, you incur ongoing costs, including management fees, distribution and service (12b-1) fees (Open Shares only), and other expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in a Portfolio and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the six month period from January 1, 2019 through June 30, 2019 and held for the entire period.
Actual Expenses
For each Share class of the Portfolios, the first line of the accompanying table provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000=8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
For each Share class of the Portfolios, the second line of the accompanying table provides information about hypothetical account values and hypothetical expenses based on the class’ actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Portfolio’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Portfolio and other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other mutual funds.
8 Semi-Annual Report
Portfolio | Beginning Account Value 1/1/19 | Ending Account Value 6/30/19 | Expenses Paid During Period* 1/1/19 - 6/30/19 | Annualized Expense Ratio During Period 1/1/19 - 6/30/19 | |
Global Dynamic Multi-Asset | |||||
Institutional Shares | |||||
Actual | $1,000.00 | $ | 1,119.70 | $4.73 | 0.90% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,020.33 | $4.51 | 0.90% |
Open Shares | |||||
Actual | $1,000.00 | $ | 1,118.70 | $6.30 | 1.20% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,018.84 | $6.01 | 1.20% |
Opportunistic Strategies† | |||||
Institutional Shares | |||||
Actual | $1,000.00 | $ | 1,111.00 | $6.54 | 1.25% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,018.60 | $6.26 | 1.25% |
Open Shares | |||||
Actual | $1,000.00 | $ | 1,110.50 | $8.06 | 1.54% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,017.16 | $7.70 | 1.54% |
Real Assets and Pricing Opportunities | |||||
Institutional Shares | |||||
Actual | $1,000.00 | $ | 1,109.40 | $4.71 | 0.90% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,020.33 | $4.51 | 0.90% |
Open Shares | |||||
Actual | $1,000.00 | $ | 1,107.10 | $6.01 | 1.15% |
Hypothetical (5% ReturnBefore Expenses) | $1,000.00 | $ | 1,019.09 | $5.76 | 1.15% |
* | Expenses are equal to the annualized expense ratio, net of expenses waivers and reimbursements, of each Share class multiplied by the average account value over the period, multiplied by 181/365 (to reflect one-half year period). |
† | The expense ratios include broker expense and dividend expense on securities sold short. |
Semi-Annual Report 9
The Lazard Funds, Inc.Portfolio Holdings
Presented by Asset Class/Sector June 30, 2019 (unaudited)
Asset Class/Sector* | Lazard Global Dynamic Multi-Asset Portfolio | Lazard Real Assets and Pricing Opportunities Portfolio | |||||||
Equity | |||||||||
Communication Services | 5.9 | % | 2.2 | % | |||||
Consumer Discretionary | 8.7 | 2.6 | |||||||
Consumer Staples | 8.8 | 3.7 | |||||||
Energy | 2.9 | 0.2 | |||||||
Financials | 13.6 | 3.5 | |||||||
Health Care | 10.3 | 3.5 | |||||||
Industrials | 10.4 | 11.3 | |||||||
Information Technology | 11.1 | 1.4 | |||||||
Materials | 2.2 | 0.9 | |||||||
Real Estate | 3.0 | 16.4 | |||||||
Utilities | 3.4 | 10.6 | |||||||
Exchange-Traded Funds | — | 2.2 | |||||||
Sovereign Debt | 14.1 | 9.3 | |||||||
US Government Securities | 0.4 | — | |||||||
US Municipal Bonds | 0.8 | — | |||||||
US Treasury Securities | 2.4 | 16.3 | |||||||
Short-Term Investments | 2.0 | 15.9 | |||||||
Total Investments | 100.0 | % | 100.0 | % | |||||
Lazard Opportunistic Strategies Portfolio | |||||||||
Asset Class/Sector* | Long* | Short# | |||||||
Equity† | |||||||||
Communication Services | 3.1 | % | –5.5 | % | |||||
Consumer Discretionary | 3.9 | –6.8 | |||||||
Consumer Staples | 2.5 | –4.5 | |||||||
Energy | 1.5 | –2.7 | |||||||
Financials | 9.7 | –17.1 | |||||||
Health Care | 3.7 | –6.6 | |||||||
Industrials | 10.5 | –18.6 | |||||||
Information Technology | 17.9 | –31.6 | |||||||
Materials | 1.7 | –3.0 | |||||||
Real Estate | 0.7 | –1.3 | |||||||
Utilities | 1.3 | –2.3 | |||||||
Fixed Income | 30.7 | — | |||||||
Short-Term Investments | 12.8 | — | |||||||
Total Investments | 100.0 | % | –100.0 | % |
* | Represents percentage of total investments excluding securities sold short. |
# | Represents percentage of total securities sold short. |
† | Equity sector breakdown is based upon the underlying holdings of exchange-traded funds and closed-end management investment companies held by the Portfolio. |
10 Semi-Annual Report
The Lazard Funds, Inc.Portfolios of Investments
June 30, 2019 (unaudited)
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 11
Description | Shares | Fair Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
CAE, Inc. | 6,020 | $ | 161,697 | |||||
Canadian National Railway Co. | 2,555 | 236,286 | ||||||
Canadian Natural Resources, Ltd. | 606 | 16,340 | ||||||
CGI, Inc. (*) | 1,584 | 121,780 | ||||||
Colliers International Group, Inc. | 407 | �� | 29,100 | |||||
Constellation Software, Inc. | 94 | 88,595 | ||||||
Granite Real Estate Investment Trust | 1,393 | 64,132 | ||||||
H&R Real Estate Investment Trust | 3,206 | 55,916 | ||||||
Kirkland Lake Gold, Ltd. | 1,154 | 49,718 | ||||||
National Bank of Canada | 816 | 38,764 | ||||||
Parex Resources, Inc. (*) | 3,843 | 61,656 | ||||||
Rogers Communications, Inc., Class B | 4,141 | 221,667 | ||||||
Teck Resources, Ltd., Class B | 2,924 | 67,476 | ||||||
The Toronto-Dominion Bank | 4,723 | 275,760 | ||||||
1,624,214 | ||||||||
China | 0.1% | ||||||||
Yangzijiang Shipbuilding Holdings, Ltd. | 28,900 | 32,767 | ||||||
Denmark | 0.5% | ||||||||
Coloplast A/S, Class B | 333 | 37,715 | ||||||
H. Lundbeck A/S | 748 | 29,580 | ||||||
Novo Nordisk A/S, Class B | 2,135 | 108,906 | ||||||
SimCorp A/S fa1 | 480 | 46,422 | ||||||
222,623 | ||||||||
Finland | 0.4% | ||||||||
Nordea Bank Abp Sponsored ADR | 13,125 | 94,894 | ||||||
Sampo Oyj, A Shares ADR | 4,910 | 115,606 | ||||||
210,500 | ||||||||
France | 1.6% | ||||||||
Electricite de France SA | 3,541 | 44,660 | ||||||
Engie SA | 889 | 13,500 | ||||||
Faurecia SA | 346 | 16,061 | ||||||
Hermes International | 45 | 32,456 | ||||||
Ipsen SA | 366 | 49,944 | ||||||
Peugeot SA | 4,639 | 114,332 | ||||||
Total SA | 6,543 | 366,088 |
The accompanying notes are an integral part of these financial statements.
12 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Ubisoft Entertainment SA ADR (*) | 8,430 | $ | 131,171 | |||||
Veolia Environnement SA | 742 | 18,090 | ||||||
786,302 | ||||||||
Germany | 1.0% | ||||||||
Allianz SE | 260 | 62,664 | ||||||
Covestro AG | 278 | 14,131 | ||||||
CTS Eventim AG & Co. KGaA | 526 | 24,478 | ||||||
Deutsche Lufthansa AG | 4,428 | 75,879 | ||||||
Deutsche Telekom AG | 1,090 | 18,863 | ||||||
Muenchener Rueckversicherungs AG | 162 | 40,658 | ||||||
Rheinmetall AG | 478 | 58,511 | ||||||
RWE AG | 692 | 17,059 | ||||||
SAP SE | 136 | 18,695 | ||||||
Siltronic AG | 231 | 16,890 | ||||||
Symrise AG ADR | 5,700 | 137,142 | ||||||
484,970 | ||||||||
Hong Kong | 1.1% | ||||||||
AIA Group, Ltd. Sponsored ADR | 5,220 | 225,243 | ||||||
CK Hutchison Holdings, Ltd. | 2,500 | 24,597 | ||||||
Hang Seng Bank, Ltd. Sponsored ADR | 7,020 | 174,166 | ||||||
Jardine Matheson Holdings, Ltd. | 300 | 18,908 | ||||||
Swire Pacific, Ltd., Class A | 10,000 | 123,043 | ||||||
565,957 | ||||||||
Israel | 0.6% | ||||||||
Bank Leumi Le-Israel BM | 9,643 | 69,679 | ||||||
Israel Discount Bank, Ltd., ADR | 3,200 | 130,512 | ||||||
Israel Discount Bank, Ltd., Class A | 24,036 | 98,278 | ||||||
298,469 | ||||||||
Italy | 1.5% | ||||||||
Assicurazioni Generali SpA | 901 | 16,945 | ||||||
Enel SpA | 61,091 | 426,858 | ||||||
Hera SpA | 10,633 | 40,695 | ||||||
Italgas SpA | 10,402 | 69,837 | ||||||
Poste Italiane SpA | 8,420 | 88,702 | ||||||
Terna SpA | 12,337 | 78,603 | ||||||
UniCredit SpA | 1,890 | 23,266 | ||||||
744,906 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 13
Description | Shares | Fair Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Japan | 5.5% | ||||||||
Amano Corp. | 1,195 | $ | 33,060 | |||||
ANA Holdings, Inc. | 700 | 23,197 | ||||||
Canon, Inc. | 700 | 20,502 | ||||||
Capcom Co., Ltd. | 900 | 18,102 | ||||||
Daito Trust Construction Co., Ltd. | 355 | 45,191 | ||||||
Daiwa House Industry Co., Ltd. | 3,100 | 90,533 | ||||||
Daiwa House Industry Co., Ltd. ADR | 4,445 | 130,861 | ||||||
Dip Corp. | 1,500 | 25,169 | ||||||
East Japan Railway Co. | 1,000 | 93,650 | ||||||
Fukuoka Financial Group, Inc. | 3,700 | 68,007 | ||||||
Japan Airlines Co., Ltd. | 1,600 | 51,186 | ||||||
Japan Post Holdings Co., Ltd. | 8,000 | 90,639 | ||||||
Japan Prime Realty Investment Corp. REIT | 7 | 30,323 | ||||||
JFE Holdings, Inc. | 4,100 | 60,357 | ||||||
Juki Corp. | 800 | 7,401 | ||||||
Kao Corp., ADR | 8,475 | 128,396 | ||||||
Kinden Corp. | 900 | 13,864 | ||||||
Kyushu Electric Power Co., Inc. | 1,900 | 18,635 | ||||||
Marvelous, Inc. | 1,800 | 13,707 | ||||||
McDonald’s Holdings Co. Japan, Ltd. | 1,200 | 52,922 | ||||||
Mitsubishi Heavy Industries, Ltd. | 600 | 26,156 | ||||||
Mitsubishi UFJ Financial Group, Inc. | 14,577 | 69,686 | ||||||
Mizuho Financial Group, Inc. | 17,500 | 25,389 | ||||||
Nintendo Co., Ltd. | 100 | 36,763 | ||||||
Nissan Chemical Corp. | 600 | 27,093 | ||||||
Nomura Holdings, Inc. | 5,400 | 19,181 | ||||||
NTT DOCOMO, Inc. | 17,918 | 418,181 | ||||||
ORIX Corp. | 1,913 | 28,597 | ||||||
SAMTY Co., Ltd. | 2,500 | 38,082 | ||||||
Seven & I Holdings Co., Ltd. | 2,800 | 94,907 | ||||||
Shikoku Electric Power Co., Inc. | 1,600 | 14,809 | ||||||
Shin-Etsu Chemical Co., Ltd. | 1,000 | 93,369 | ||||||
Shionogi & Co., Ltd. | 400 | 23,097 | ||||||
Showa Denko KK | 700 | 20,759 | ||||||
SoftBank Group Corp. | 500 | 24,094 |
The accompanying notes are an integral part of these financial statements.
14 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Sompo Holdings, Inc. | 1,104 | $ | 42,726 | |||||
Stanley Electric Co., Ltd. | 600 | 14,792 | ||||||
Sumitomo Heavy Industries, Ltd. | 1,100 | 37,948 | ||||||
Sumitomo Mitsui Construction Co., Ltd. | 5,900 | 32,746 | ||||||
Sumitomo Mitsui Trust Holdings, Inc. | 1,000 | 36,325 | ||||||
Suzuken Co., Ltd. | 400 | 23,510 | ||||||
Taisei Corp. | 700 | 25,478 | ||||||
TechnoPro Holdings Inc., ADR | 12,825 | 135,945 | ||||||
Teijin, Ltd. | 1,095 | 18,695 | ||||||
The Chiba Bank, Ltd. | 7,800 | 38,201 | ||||||
The Chugoku Electric Power Co., Inc. | 1,231 | 15,536 | ||||||
The Dai-ichi Life Insurance Co., Ltd. | 5,600 | 84,724 | ||||||
The Gunma Bank, Ltd. | 7,100 | 24,943 | ||||||
Tosoh Corp. | 1,500 | 21,167 | ||||||
Yamaha Corp. Sponsored ADR | 4,100 | 195,980 | ||||||
2,724,581 | ||||||||
Netherlands | 1.0% | ||||||||
Euronext NV | 571 | 43,212 | ||||||
Koninklijke Ahold Delhaize NV | 1,775 | 39,921 | ||||||
Royal Dutch Shell PLC, A Shares | 3,359 | 109,990 | ||||||
Wolters Kluwer NV | 173 | 12,595 | ||||||
Wolters Kluwer NV Sponsored ADR | 4,270 | 310,258 | ||||||
515,976 | ||||||||
Norway | 0.6% | ||||||||
Aker BP ASA | 715 | 20,616 | ||||||
DNO ASA | 10,756 | 19,557 | ||||||
Equinor ASA | 3,147 | 62,348 | ||||||
Leroy Seafood Group ASA | 3,807 | 25,231 | ||||||
Salmar ASA | 915 | 39,792 | ||||||
Telenor ASA | 4,797 | 101,940 | ||||||
TGS NOPEC Geophysical Co. ASA | 604 | 16,954 | ||||||
286,438 | ||||||||
Puerto Rico | 0.1% | ||||||||
EVERTEC, Inc. | 1,372 | 44,864 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 15
Description | Shares | Fair Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Singapore | 0.6% | ||||||||
Jardine Cycle & Carriage, Ltd. | 1,500 | $ | 40,241 | |||||
Oversea-Chinese Banking Corp., Ltd. | 2,100 | 17,755 | ||||||
Oversea-Chinese Banking Corp., Ltd. ADR | 10,480 | 175,121 | ||||||
Singapore Technologies Engineering, Ltd. | 27,900 | 85,521 | ||||||
318,638 | ||||||||
Spain | 0.2% | ||||||||
Amadeus IT Group SA | 240 | 18,993 | ||||||
CIE Automotive SA | 789 | 22,845 | ||||||
Corporacion Financiera Alba SA | 204 | 10,694 | ||||||
Iberdrola SA | 6,452 | 64,358 | ||||||
116,890 | ||||||||
Sweden | 0.9% | ||||||||
Assa Abloy AB ADR | 9,710 | 109,092 | ||||||
Axfood AB | 2,075 | 41,060 | ||||||
Boliden AB | 583 | 14,910 | ||||||
Epiroc AB ADR | 13,660 | 141,053 | ||||||
Hexagon AB ADR | 2,465 | 136,709 | ||||||
442,824 | ||||||||
Switzerland | 1.9% | ||||||||
Alcon, Inc. (*) | 1,283 | 79,610 | ||||||
Helvetia Holding AG | 232 | 29,151 | ||||||
Novartis AG | 1,201 | 109,852 | ||||||
Novartis AG Sponsored ADR | 2,465 | 225,079 | ||||||
Partners Group Holding AG | 81 | 63,647 | ||||||
Roche Holding AG | 1,269 | 357,054 | ||||||
The Swatch Group AG | 528 | 28,590 | ||||||
Zurich Insurance Group AG | 175 | 60,937 | ||||||
953,920 | ||||||||
United Kingdom | 4.5% | ||||||||
Admiral Group PLC | 1,638 | 46,021 | ||||||
Anglo American PLC | 2,237 | 63,987 | ||||||
Associated British Foods PLC | 652 | 20,436 | ||||||
Auto Trader Group PLC | 4,541 | 31,648 | ||||||
Britvic PLC | 2,256 | 25,477 | ||||||
Bunzl PLC Sponsored ADR | 4,825 | 129,262 |
The accompanying notes are an integral part of these financial statements.
16 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Centrica PLC | 23,595 | $ | 26,305 | |||||
Coca-Cola European Partners PLC | 3,100 | 175,150 | ||||||
Compass Group PLC | 2,487 | 59,602 | ||||||
Compass Group PLC Sponsored ADR | 6,597 | 158,064 | ||||||
Diageo PLC Sponsored ADR | 2,030 | 349,810 | ||||||
Howden Joinery Group PLC | 6,974 | 44,906 | ||||||
Imperial Brands PLC | 1,708 | 40,104 | ||||||
International Consolidated Airlines Group SA | 4,631 | 28,041 | ||||||
International Consolidated Airlines Group SA | 3,180 | 19,290 | ||||||
National Grid PLC | 4,155 | 44,156 | ||||||
Prudential PLC ADR | 2,910 | 127,516 | ||||||
RELX PLC Sponsored ADR | 9,570 | 233,604 | ||||||
Rio Tinto, Ltd. | 1,155 | 84,279 | ||||||
Royal Bank of Scotland Group PLC | 6,208 | 17,332 | ||||||
RSA Insurance Group PLC ADR | 13,325 | 97,273 | ||||||
SSP Group PLC | 5,096 | 44,450 | ||||||
The Weir Group PLC Sponsored ADR | 6,985 | 69,571 | ||||||
Unilever PLC Sponsored ADR | 4,195 | 259,964 | ||||||
WH Smith PLC | 1,436 | 35,928 | ||||||
2,232,176 | ||||||||
United States | 44.3% | ||||||||
3M Co. | 217 | 37,615 | ||||||
AbbVie, Inc. | 1,459 | 106,099 | ||||||
Accenture PLC, Class A | 1,345 | 248,516 | ||||||
ACI Worldwide, Inc. (*) | 877 | 30,116 | ||||||
AES Corp. | 4,803 | 80,498 | ||||||
Aflac, Inc. | 3,007 | 164,814 | ||||||
Akamai Technologies, Inc. (*) | 2,030 | 162,684 | ||||||
Align Technology, Inc. (*) | 138 | 37,771 | ||||||
Alphabet, Inc., Class A (*) | 263 | 284,776 | ||||||
Alphabet, Inc., Class C (*) | 32 | 34,589 | ||||||
Altria Group, Inc. | 741 | 35,086 | ||||||
Amazon.com, Inc. (*) | 191 | 361,683 | ||||||
American Express Co. | 1,094 | 135,043 | ||||||
American Tower Corp. REIT | 457 | 93,434 | ||||||
Ameriprise Financial, Inc. | 627 | 91,015 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 17
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Amgen, Inc. | 256 | $ | 47,176 | |||||
Aon PLC | 2,599 | 501,555 | ||||||
Apple, Inc. | 2,533 | 501,331 | ||||||
Applied Materials, Inc. | 495 | 22,230 | ||||||
AutoZone, Inc. (*) | 126 | 138,533 | ||||||
Avnet, Inc. | 816 | 36,940 | ||||||
AXA Equitable Holdings, Inc. | 3,048 | 63,703 | ||||||
Bank of America Corp. | 4,305 | 124,845 | ||||||
Baxter International, Inc. | 247 | 20,229 | ||||||
Best Buy Co., Inc. | 283 | 19,734 | ||||||
Booking Holdings, Inc. (*) | 13 | 24,371 | ||||||
BorgWarner, Inc. | 471 | 19,773 | ||||||
Boston Scientific Corp. (*) | 4,445 | 191,046 | ||||||
Brinker International, Inc. | 944 | 37,146 | ||||||
Bristol-Myers Squibb Co. | 2,127 | 96,459 | ||||||
Broadcom, Inc. | 212 | 61,026 | ||||||
Broadridge Financial Solutions, Inc. | 280 | 35,750 | ||||||
Burlington Stores, Inc. (*) | 170 | 28,926 | ||||||
Cable One, Inc. | 28 | 32,788 | ||||||
Cadence Design Systems, Inc. (*) | 1,201 | 85,043 | ||||||
Cardinal Health, Inc. | 552 | 25,999 | ||||||
Caterpillar, Inc. | 808 | 110,122 | ||||||
CBRE Group, Inc., Class A (*) | 2,878 | 147,641 | ||||||
CDW Corp. | 355 | 39,405 | ||||||
Cerner Corp. | 628 | 46,032 | ||||||
Chevron Corp. | 2,354 | 292,932 | ||||||
Church & Dwight Co., Inc. | 413 | 30,174 | ||||||
Cigna Corp. | 618 | 97,366 | ||||||
Cisco Systems, Inc. | 3,175 | 173,768 | ||||||
Citigroup, Inc. | 957 | 67,019 | ||||||
Citizens Financial Group, Inc. | 435 | 15,382 | ||||||
Colgate-Palmolive Co. | 1,344 | 96,325 | ||||||
Comcast Corp., Class A | 6,500 | 274,820 | ||||||
Comerica, Inc. | 2,175 | 157,992 | ||||||
ConocoPhillips | 3,342 | 203,862 | ||||||
CoreLogic, Inc. (*) | 2,430 | 101,647 |
The accompanying notes are an integral part of these financial statements.
18 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Costco Wholesale Corp. | 203 | $ | 53,645 | |||||
Cummins, Inc. | 399 | 68,365 | ||||||
Darden Restaurants, Inc. | 1,398 | 170,179 | ||||||
Delta Air Lines, Inc. | 927 | 52,607 | ||||||
Discover Financial Services | 797 | 61,839 | ||||||
Dollar General Corp. | 1,005 | 135,836 | ||||||
E*TRADE Financial Corp. | 646 | 28,812 | ||||||
Eaton Corp. PLC | 1,205 | 100,352 | ||||||
eBay, Inc. | 2,920 | 115,340 | ||||||
Edison International | 2,436 | 164,211 | ||||||
Electronic Arts, Inc. (*) | 280 | 28,353 | ||||||
Eli Lilly & Co. | 2,229 | 246,951 | ||||||
Encompass Health Corp. | 1,063 | 67,352 | ||||||
EPR Properties REIT | 378 | 28,195 | ||||||
Exelon Corp. | 1,947 | 93,339 | ||||||
Exponent, Inc. | 505 | 29,563 | ||||||
F5 Networks, Inc. (*) | 663 | 96,553 | ||||||
Facebook, Inc., Class A (*) | 935 | 180,455 | ||||||
FactSet Research Systems, Inc. | 116 | 33,241 | ||||||
Fidelity National Information Services, Inc. | 577 | 70,786 | ||||||
GreenSky, Inc., Class A (*) | 1,805 | 22,183 | ||||||
HCA Healthcare, Inc. | 440 | 59,475 | ||||||
HEICO Corp., Class A | 286 | 29,564 | ||||||
Honeywell International, Inc. | 1,736 | 303,088 | ||||||
Huntsman Corp. | 2,760 | 56,414 | ||||||
IDEXX Laboratories, Inc. (*) | 262 | 72,136 | ||||||
Insperity, Inc. | 271 | 33,100 | ||||||
Intel Corp. | 4,262 | 204,022 | ||||||
Intercontinental Exchange, Inc. | 2,830 | 243,210 | ||||||
International Business Machines Corp. | 951 | 131,143 | ||||||
Intuit, Inc. | 1,069 | 279,362 | ||||||
IQVIA Holdings, Inc. (*) | 2,136 | 343,682 | ||||||
Johnson & Johnson | 4,955 | 690,132 | ||||||
Jones Lang LaSalle, Inc. | 491 | 69,079 | ||||||
JPMorgan Chase & Co. | 150 | 16,770 | ||||||
Kellogg Co. | 494 | 26,464 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 19
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
Keysight Technologies, Inc. (*) | 350 | $ | 31,434 | |||||
Kimberly-Clark Corp. | 1,055 | 140,610 | ||||||
Kimco Realty Corp. REIT | 1,594 | 29,457 | ||||||
Kohl’s Corp. | 346 | 16,452 | ||||||
Laboratory Corp. of America Holdings (*) | 1,037 | 179,297 | ||||||
Lamb Weston Holdings, Inc. | 376 | 23,823 | ||||||
Life Storage, Inc. REIT | 376 | 35,750 | ||||||
Lincoln National Corp. | 813 | 52,398 | ||||||
Lockheed Martin Corp. | 982 | 356,996 | ||||||
Lowe’s Cos., Inc. | 1,230 | 124,119 | ||||||
LPL Financial Holdings, Inc. | 716 | 58,404 | ||||||
Lululemon Athletica, Inc. (*) | 905 | 163,090 | ||||||
MarketAxess Holdings, Inc. | 113 | 36,320 | ||||||
MasterCard, Inc., Class A | 1,806 | 477,741 | ||||||
Maxim Integrated Products, Inc. | 341 | 20,399 | ||||||
McDonald’s Corp. | 1,180 | 245,039 | ||||||
McGrath RentCorp | 480 | 29,832 | ||||||
Mellanox Technologies, Ltd. (*) | 360 | 39,841 | ||||||
Merck & Co., Inc. | 4,160 | 348,816 | ||||||
MetLife, Inc. | 1,557 | 77,336 | ||||||
Microsoft Corp. | 4,469 | 598,667 | ||||||
MKS Instruments, Inc. | 319 | 24,847 | ||||||
Moody’s Corp. | 232 | 45,312 | ||||||
Morgan Stanley | 1,221 | 53,492 | ||||||
Morningstar, Inc. | 199 | 28,783 | ||||||
Motorola Solutions, Inc. | 1,635 | 272,604 | ||||||
Nasdaq, Inc. | 384 | 36,929 | ||||||
NetApp, Inc. | 934 | 57,628 | ||||||
NIKE, Inc., Class B | 1,223 | 102,671 | ||||||
Nordstrom, Inc. | 866 | 27,591 | ||||||
Northrop Grumman Corp. | 991 | 320,202 | ||||||
NVIDIA Corp. | 452 | 74,232 | ||||||
NVR, Inc. (*) | 6 | 20,222 | ||||||
Occidental Petroleum Corp. | 1,386 | 69,688 | ||||||
Omnicom Group, Inc. | 656 | 53,759 | ||||||
Paycom Software, Inc. (*) | 117 | 26,526 |
The accompanying notes are an integral part of these financial statements.
20 Semi-Annual Report
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
PayPal Holdings, Inc. (*) | 210 | $ | 24,037 | |||||
PepsiCo, Inc. | 1,477 | 193,679 | ||||||
Philip Morris International, Inc. | 2,208 | 173,394 | ||||||
Phillips 66 | 233 | 21,795 | ||||||
Pinnacle West Capital Corp. | 1,870 | 175,948 | ||||||
Pioneer Natural Resources Co. | 330 | 50,774 | ||||||
PotlatchDeltic Corp. REIT | 391 | 15,241 | ||||||
Premier, Inc., Class A (*) | 1,728 | 67,582 | ||||||
Prudential Financial, Inc. | 758 | 76,558 | ||||||
Public Service Enterprise Group, Inc. | 601 | 35,351 | ||||||
Radian Group, Inc. | 840 | 19,194 | ||||||
Ralph Lauren Corp. | 309 | 35,099 | ||||||
Raytheon Co. | 131 | 22,778 | ||||||
Regions Financial Corp. | 5,615 | 83,888 | ||||||
Republic Services, Inc. | 2,001 | 173,367 | ||||||
Rockwell Automation, Inc. | 1,185 | 194,139 | ||||||
Ross Stores, Inc. | 682 | 67,600 | ||||||
S&P Global, Inc. | 865 | 197,038 | ||||||
Schlumberger, Ltd. | 2,240 | 89,018 | ||||||
Seagate Technology PLC | 538 | 25,351 | ||||||
Simon Property Group, Inc. REIT | 2,429 | 388,057 | ||||||
Skyworks Solutions, Inc. | 224 | 17,308 | ||||||
Starbucks Corp. | 4,441 | 372,289 | ||||||
Stryker Corp. | 356 | 73,186 | ||||||
Synchrony Financial | 2,871 | 99,538 | ||||||
Synovus Financial Corp. | 1,584 | 55,440 | ||||||
Sysco Corp. | 2,520 | 178,214 | ||||||
T-Mobile US, Inc. (*) | 2,664 | 197,509 | ||||||
Taubman Centers, Inc. REIT | 853 | 34,828 | ||||||
TE Connectivity, Ltd. | 529 | 50,668 | ||||||
Teradyne, Inc. | 468 | 22,422 | ||||||
Texas Instruments, Inc. | 1,070 | 122,793 | ||||||
The Coca-Cola Co. | 5,455 | 277,769 | ||||||
The Estee Lauder Cos., Inc., Class A | 2,177 | 398,630 | ||||||
The Hershey Co. | 1,317 | 176,518 | ||||||
The Kroger Co. | 1,601 | 34,758 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 21
Fair | ||||||||
Description | Shares | Value | ||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||
The Procter & Gamble Co. | 3,856 | $ | 422,810 | |||||
The Progressive Corp. | 499 | 39,885 | ||||||
The TJX Cos., Inc. | 6,954 | 367,728 | ||||||
The Walt Disney Co. | 752 | 105,009 | ||||||
Thermo Fisher Scientific, Inc. | 1,185 | 348,011 | ||||||
Tractor Supply Co. | 1,462 | 159,066 | ||||||
Tyson Foods, Inc., Class A | 721 | 58,214 | ||||||
Ulta Salon Cosmetics & Fragrance, Inc. (*) | 74 | 25,670 | ||||||
United Continental Holdings, Inc. (*) | 553 | 48,415 | ||||||
United Rentals, Inc. (*) | 106 | 14,059 | ||||||
UnitedHealth Group, Inc. | 155 | 37,822 | ||||||
Universal Health Services, Inc., Class B | 441 | 57,502 | ||||||
Unum Group | 789 | 26,471 | ||||||
USANA Health Sciences, Inc. (*) | 391 | 31,057 | ||||||
Varian Medical Systems, Inc. (*) | 209 | 28,451 | ||||||
Verizon Communications, Inc. | 4,850 | 277,081 | ||||||
Vertex Pharmaceuticals, Inc. (*) | 115 | 21,089 | ||||||
Viacom, Inc., Class B | 674 | 20,132 | ||||||
Visa, Inc., Class A | 1,685 | 292,432 | ||||||
VMware, Inc., Class A | 154 | 25,750 | ||||||
Vocera Communications, Inc. (*) | 1,166 | 37,219 | ||||||
Vulcan Materials Co. | 287 | 39,408 | ||||||
Walgreens Boots Alliance, Inc. | 456 | 24,930 | ||||||
Walmart, Inc. | 513 | 56,681 | ||||||
Waste Management, Inc. | 1,609 | 185,630 | ||||||
WW Grainger, Inc. | 165 | 44,258 | ||||||
Zions BanCorp. | 403 | 18,530 | ||||||
Zoetis, Inc. | 2,931 | 332,639 | ||||||
21,966,641 | ||||||||
Total Common Stocks (Cost $33,484,718) | 36,091,386 |
The accompanying notes are an integral part of these financial statements.
22 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Corporate Bonds | 7.4% | ||||||||||
Australia | 0.1% | ||||||||||
Telstra Corp., Ltd., 4.000%, 09/16/22 | AUD | 80 | $ | 59,677 | ||||||
Canada | 0.5% | ||||||||||
Canadian Imperial Bank of Commerce, 2.900%, 09/14/21 | CAD | 210 | 163,638 | |||||||
Rogers Communications, Inc., 3.250%, 05/01/29 | CAD | 85 | 66,557 | |||||||
230,195 | ||||||||||
France | 0.3% | ||||||||||
Schneider Electric SE, 2.950%, 09/27/22 | USD | 170 | 172,943 | |||||||
Germany | 0.3% | ||||||||||
BMW Finance NV, 0.875%, 08/16/22 | GBP | 110 | 137,419 | |||||||
Netherlands | 0.6% | ||||||||||
BNG Bank NV, 5.000%, 09/16/20 | NZD | 163 | 113,626 | |||||||
Nederlandse Waterschapsbank NV, 3.125%, 12/05/22 (#) | USD | 200 | 208,141 | |||||||
321,767 | ||||||||||
New Zealand | 0.2% | ||||||||||
Fonterra Cooperative Group, Ltd., 5.500%, 02/26/24 | AUD | 100 | 80,746 | |||||||
Switzerland | 0.3% | ||||||||||
ABB Finance USA, Inc., 3.375%, 04/03/23 | USD | 142 | 146,876 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 23
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
United Kingdom | 0.8% | ||||||||||
Ashtead Capital, Inc., 4.125%, 08/15/25 | USD | 200 | $ | 202,500 | ||||||
Unilever Capital Corp., 3.250%, 03/07/24 | USD | 200 | 208,028 | |||||||
410,528 | ||||||||||
United States | 4.3% | ||||||||||
Apple, Inc., 3.850%, 05/04/43 | USD | 185 | 196,320 | |||||||
Bank of America Corp., 3.499%, 05/17/22 (§) | USD | 160 | 163,162 | |||||||
Citigroup, Inc., 3.095% (BBSW 3 Month + 1.550%), 05/04/21 (§) | AUD | 208 | 148,173 | |||||||
John Deere Canada Funding, Inc., 2.050%, 09/17/20 | CAD | 210 | 160,477 | |||||||
Johnson & Johnson, 3.625%, 03/03/37 | USD | 175 | 187,147 | |||||||
JPMorgan Chase & Co., 4.500%, 01/24/22 | USD | 145 | 152,740 | |||||||
McDonald’s Corp., 3.125%, 03/04/25 | CAD | 200 | 157,989 | |||||||
Microsoft Corp., 4.450%, 11/03/45 | USD | 160 | 191,659 | |||||||
Morgan Stanley, 3.625%, 01/20/27 | USD | 180 | 189,063 | |||||||
NIKE, Inc., 2.375%, 11/01/26 | USD | 190 | 190,413 | |||||||
Starbucks Corp., 4.450%, 08/15/49 | USD | 125 | 136,713 | |||||||
The Goldman Sachs Group, Inc., 3.625%, 01/22/23 | USD | 80 | 82,958 | |||||||
Verizon Communications, Inc., 3.875%, 02/08/29 | USD | 150 | 160,812 | |||||||
2,117,626 | ||||||||||
Total Corporate Bonds (Cost $3,528,878) | 3,677,777 |
The accompanying notes are an integral part of these financial statements.
24 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Foreign Government Obligations | 10.8% | ||||||||||
Australia | 0.3% | ||||||||||
Queensland Treasury Corp., 3.000%, 03/22/24 | AUD | 215 | $ | 162,543 | ||||||
Bermuda | 0.8% | ||||||||||
Government of Bermuda: | ||||||||||
4.854%, 02/06/24 | USD | 200 | 216,500 | |||||||
3.717%, 01/25/27 | USD | 200 | 203,250 | |||||||
419,750 | ||||||||||
Canada | 0.8% | ||||||||||
City of Vancouver, 2.900%, 11/20/25 | CAD | 105 | 84,126 | |||||||
Province of Ontario, 2.450%, 06/29/22 | USD | 80 | 81,108 | |||||||
Province of Quebec: | ||||||||||
1.650%, 03/03/22 | CAD | 105 | 80,188 | |||||||
2.500%, 04/20/26 | USD | 135 | 137,715 | |||||||
383,137 | ||||||||||
Chile | 0.7% | ||||||||||
Bonos de la Tesoreria de la Republica en pesos, 4.500%, 03/01/26 | CLP | 100,000 | 159,757 | |||||||
Republic of Chile, 3.125%, 01/21/26 | USD | 200 | 208,250 | |||||||
368,007 | ||||||||||
Czech Republic | 0.8% | ||||||||||
Czech Republic: | ||||||||||
2.150% (PRIBOR 6 Month - 0.100%), 11/19/27 (§) | CZK | 2,850 | 128,927 | |||||||
2.500%, 08/25/28 | CZK | 5,330 | 259,158 | |||||||
388,085 | ||||||||||
France | 0.6% | ||||||||||
Government of France, 1.750%, 06/25/39 | EUR | 201 | 278,444 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 25
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Hungary | 0.8% | ||||||||||
Hungary, 6.375%, 03/29/21 | USD | 150 | $ | 160,076 | ||||||
Hungary Government Bonds: | ||||||||||
3.000%, 10/27/27 | HUF | 34,430 | 128,381 | |||||||
3.000%, 08/21/30 | HUF | 35,400 | 129,117 | |||||||
417,574 | ||||||||||
Ireland | 0.9% | ||||||||||
Ireland Government Bonds: | ||||||||||
1.350%, 03/18/31 | EUR | 105 | 132,818 | |||||||
1.700%, 05/15/37 | EUR | 220 | 289,533 | |||||||
422,351 | ||||||||||
Italy | 0.3% | ||||||||||
Italy Government International Bonds, 6.875%, 09/27/23 | USD | 145 | 163,917 | |||||||
Japan | 0.4% | ||||||||||
Japan International Cooperation Agency, 2.125%, 10/20/26 | USD | 200 | 196,564 | |||||||
Mexico | 0.2% | ||||||||||
United Mexican States, 6.750%, 02/06/24 | GBP | 60 | 90,696 | |||||||
New Zealand | 0.2% | ||||||||||
New Zealand Government Bonds, 6.000%, 05/15/21 | NZD | 170 | 123,526 | |||||||
Norway | 1.4% | ||||||||||
Kommunalbanken AS, 1.375%, 10/26/20 (#) | USD | 200 | 198,280 | |||||||
Oslo Kommune: | ||||||||||
2.300%, 03/14/24 | NOK | 1,000 | 118,717 | |||||||
2.350%, 09/04/24 | NOK | 2,000 | 238,256 | |||||||
1.870%, 05/06/26 (§) | NOK | 1,000 | 118,415 | |||||||
673,668 |
The accompanying notes are an integral part of these financial statements.
26 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Panama | 0.4% | ||||||||||
Republic of Panama, 4.000%, 09/22/24 | USD | 200 | $ | 213,312 | ||||||
Poland | 0.5% | ||||||||||
Poland Government Bonds, 2.500%, 07/25/26 | PLN | 960 | 261,238 | |||||||
Romania | 0.2% | ||||||||||
Romania Government Bonds, 2.375%, 04/19/27 | EUR | 70 | 86,214 | |||||||
Singapore | 0.3% | ||||||||||
Singapore Government Bonds, 3.375%, 09/01/33 | SGD | 155 | 129,599 | |||||||
Spain | 0.6% | ||||||||||
Spain Government Bonds, 1.400%, 04/30/28 | EUR | 220 | 274,700 | |||||||
United Kingdom | 0.6% | ||||||||||
United Kingdom Gilt: | ||||||||||
1.750%, 09/07/37 | GBP | 100 | 135,161 | |||||||
1.500%, 07/22/47 | GBP | 115 | 146,859 | |||||||
282,020 | ||||||||||
Total Foreign Government Obligations (Cost $5,140,219) | 5,335,345 | |||||||||
Quasi Government Bonds | 0.5% | ||||||||||
Canada | 0.5% | ||||||||||
Export Development Canada, 1.800%, 09/01/22 (Cost $235,240) | CAD | 315 | 241,840 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 27
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Supranational Bonds | 2.8% | ||||||||||
African Development Bank, 2.375%, 09/23/21 | USD | 174 | $ | 175,998 | ||||||
Asian Development Bank: | ||||||||||
1.000%, 12/15/22 | GBP | 145 | 184,664 | |||||||
2.125%, 03/19/25 | USD | 210 | 212,454 | |||||||
European Investment Bank, 1.125%, 09/16/21 (#) | CAD | 220 | 166,264 | |||||||
International Bank for Reconstruction & Development: | ||||||||||
3.500%, 01/22/21 | NZD | 125 | 86,434 | |||||||
2.500%, 08/03/23 | CAD | 315 | 247,862 | |||||||
2.900%, 11/26/25 | AUD | 90 | 68,223 | |||||||
International Finance Corp.: | ||||||||||
3.625%, 05/20/20 | NZD | 165 | 112,856 | |||||||
2.700%, 03/15/23 | AUD | 180 | 132,447 | |||||||
Total Supranational Bonds | ||||||||||
(Cost $1,373,306) | 1,387,202 | |||||||||
US Government Securities | 0.4% | ||||||||||
Federal National Mortgage Association, 2.625%, 09/06/24 (Cost $203,415) | 205 | 212,669 | ||||||||
US Municipal Bonds | 0.8% | ||||||||||
California | 0.6% | ||||||||||
California State Build America Bonds, 7.500%, 04/01/34 | USD | 120 | 181,128 | |||||||
State of California, 4.500%, 04/01/33 | USD | 100 | 113,088 | |||||||
294,216 |
The accompanying notes are an integral part of these financial statements.
28 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Global Dynamic Multi-Asset Portfolio (continued) | ||||||||||
Georgia | 0.2% | ||||||||||
Georgia State Build America Bonds Series B, 2.380%, 02/01/27 | USD | 100 | $ | 99,170 | ||||||
Total US Municipal Bonds (Cost $375,352) | 393,386 | |||||||||
US Treasury Securities | 2.4% | ||||||||||
US Treasury Notes: | ||||||||||
2.125%, 05/15/25 | USD | 645 | 655,532 | |||||||
2.875%, 08/15/28 | USD | 375 | 402,773 | |||||||
3.125%, 11/15/41 | USD | 120 | 134,180 | |||||||
Total US Treasury Securities (Cost $1,130,799) | 1,192,485 |
Description | Shares | Fair Value | ||||||||
Short-Term Investments | 2.0% | ||||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $995,044) | 995,044 | 995,044 | ||||||||
Total Investments | 99.9% (Cost $46,466,971) (») | $ | 49,527,134 | ||||||||
Cash and Other Assets in Excess of Liabilities | 0.1% | 26,853 | |||||||||
Net Assets | 100.0% | $ | 49,553,987 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 29
Lazard Global Dynamic Multi-Asset Portfolio (continued)
Forward Currency Contracts open at June 30, 2019:
Currency Purchased | Quantity | Currency Sold | Quantity | Counterparty | Settlement Date | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||||
AUD | 161,771 | USD | 113,265 | HSB | 08/14/19 | $ | 467 | $ | — | |||||||||||||
AUD | 116,813 | USD | 81,686 | JPM | 08/14/19 | 439 | — | |||||||||||||||
AUD | 73,839 | USD | 51,600 | MSC | 08/14/19 | 312 | — | |||||||||||||||
CAD | 96,532 | USD | 72,300 | JPM | 08/14/19 | 1,481 | — | |||||||||||||||
CAD | 251,387 | USD | 191,303 | JPM | 08/14/19 | 836 | — | |||||||||||||||
CAD | 245,397 | USD | 187,687 | SSB | 09/26/19 | — | 9 | |||||||||||||||
CHF | 47,229 | USD | 47,368 | HSB | 08/14/19 | 1,204 | — | |||||||||||||||
CLP | 16,516,067 | USD | 24,303 | CIT | 07/25/19 | 79 | — | |||||||||||||||
CZK | 3,276,761 | EUR | 126,900 | JPM | 07/25/19 | 2,032 | — | |||||||||||||||
CZK | 1,196,354 | USD | 53,391 | JPM | 07/25/19 | 135 | — | |||||||||||||||
EUR | 118,741 | USD | 134,000 | CIT | 07/11/19 | 1,123 | — | |||||||||||||||
EUR | 385,215 | USD | 435,782 | CIT | 07/11/19 | 2,580 | — | |||||||||||||||
EUR | 103,651 | USD | 116,776 | HSB | 07/11/19 | 1,176 | — | |||||||||||||||
EUR | 109,565 | USD | 124,003 | HSB | 07/11/19 | 678 | — | |||||||||||||||
EUR | 1,327,039 | USD | 1,501,113 | HSB | 07/11/19 | 9,013 | — | |||||||||||||||
EUR | 126,053 | USD | 143,339 | JPM | 07/11/19 | 106 | — | |||||||||||||||
EUR | 290,655 | USD | 328,847 | JPM | 07/11/19 | 1,909 | — | |||||||||||||||
EUR | 225,378 | USD | 258,537 | SSB | 09/26/19 | — | 538 | |||||||||||||||
GBP | 32,044 | USD | 41,100 | JPM | 08/14/19 | — | 322 | |||||||||||||||
GBP | 189,695 | USD | 240,978 | JPM | 08/14/19 | 419 | — | |||||||||||||||
HUF | 10,000,995 | USD | 35,208 | JPM | 08/08/19 | 76 | — | |||||||||||||||
HUF | 14,552,891 | USD | 51,278 | JPM | 08/08/19 | 65 | — | |||||||||||||||
IDR | 599,248,000 | USD | 41,600 | HSB | 09/11/19 | 447 | — | |||||||||||||||
JPY | 13,062,497 | USD | 122,492 | CIT | 08/14/19 | — | 945 | |||||||||||||||
JPY | 126,259,222 | USD | 1,164,799 | CIT | 08/14/19 | 10,043 | — | |||||||||||||||
JPY | 165,413,455 | USD | 1,526,081 | HSB | 08/14/19 | 13,091 | — | |||||||||||||||
JPY | 12,888,078 | USD | 120,500 | JPM | 08/14/19 | — | 576 | |||||||||||||||
JPY | 3,026,139 | USD | 28,377 | SSB | 09/26/19 | — | 133 | |||||||||||||||
JPY | 17,409,646 | USD | 162,618 | SSB | 09/26/19 | — | 131 | |||||||||||||||
KRW | 203,072,780 | USD | 172,300 | HSB | 08/05/19 | 3,342 | — | |||||||||||||||
MXN | 616,618 | USD | 31,621 | HSB | 08/14/19 | 279 | — | |||||||||||||||
NOK | 128,804 | USD | 14,767 | HSB | 08/14/19 | 353 | — | |||||||||||||||
NOK | 1,031,475 | USD | 118,329 | HSB | 08/14/19 | 2,749 | — | |||||||||||||||
NZD | 86,900 | USD | 57,400 | HSB | 08/14/19 | 1,032 | — | |||||||||||||||
NZD | 90,185 | USD | 60,331 | JPM | 08/14/19 | 310 | — |
The accompanying notes are an integral part of these financial statements.
30 Semi-Annual Report
Lazard Global Dynamic Multi-Asset Portfolio (continued)
Currency Purchased | Quantity | Currency Sold | Quantity | Counterparty | Settlement Date | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||||
PLN | 135,881 | USD | 36,256 | HSB | 08/14/19 | $ | 177 | $ | — | |||||||||||||
SEK | 608,519 | USD | 64,600 | MSC | 08/14/19 | 1,137 | — | |||||||||||||||
SGD | 4,049 | USD | 2,959 | JPM | 08/14/19 | 36 | — | |||||||||||||||
SGD | 22,826 | USD | 16,870 | JPM | 08/14/19 | 13 | — | |||||||||||||||
SGD | 39,498 | USD | 28,863 | JPM | 08/14/19 | 351 | — | |||||||||||||||
USD | 108,723 | AUD | 155,812 | CIT | 08/14/19 | — | 820 | |||||||||||||||
USD | 30,800 | AUD | 44,193 | HSB | 08/14/19 | — | 269 | |||||||||||||||
USD | 262,425 | AUD | 375,983 | HSB | 08/14/19 | — | 1,908 | |||||||||||||||
USD | 268,586 | AUD | 384,787 | JPM | 08/14/19 | — | 1,937 | |||||||||||||||
USD | 361,975 | AUD | 518,536 | SSB | 09/26/19 | — | 2,987 | |||||||||||||||
USD | 82,701 | CAD | 111,269 | CIT | 08/14/19 | — | 2,344 | |||||||||||||||
USD | 46,200 | CAD | 60,824 | HSB | 08/14/19 | — | 288 | |||||||||||||||
USD | 622,503 | CAD | 837,061 | HSB | 08/14/19 | — | 17,275 | |||||||||||||||
USD | 504,304 | CAD | 678,141 | JPM | 08/14/19 | — | 14,009 | |||||||||||||||
USD | 588,229 | CAD | 775,050 | SSB | 09/26/19 | — | 4,524 | |||||||||||||||
USD | 174,992 | CLP | 116,994,297 | CIT | 07/25/19 | 2,278 | — | |||||||||||||||
USD | 51,400 | CZK | 1,150,253 | JPM | 07/25/19 | — | 63 | |||||||||||||||
USD | 145,337 | CZK | 3,312,819 | JPM | 07/25/19 | — | 2,882 | |||||||||||||||
USD | 89,454 | EUR | 79,237 | HSB | 07/11/19 | — | 715 | |||||||||||||||
USD | 98,721 | EUR | 87,152 | HSB | 07/11/19 | — | 455 | |||||||||||||||
USD | 148,630 | EUR | 131,193 | HSB | 07/11/19 | — | 663 | |||||||||||||||
USD | 332,500 | EUR | 292,061 | HSB | 07/11/19 | 144 | — | |||||||||||||||
USD | 559,700 | EUR | 492,078 | HSB | 07/11/19 | — | 268 | |||||||||||||||
USD | 16,159 | EUR | 14,324 | JPM | 07/11/19 | — | 142 | |||||||||||||||
USD | 97,600 | GBP | 76,687 | HSB | 08/14/19 | 12 | — | |||||||||||||||
USD | 105,290 | GBP | 80,931 | HSB | 08/14/19 | 2,301 | — | |||||||||||||||
USD | 58,780 | GBP | 45,178 | JPM | 08/14/19 | 1,288 | — | |||||||||||||||
USD | 49,879 | GBP | 39,041 | SSB | 09/26/19 | 111 | — | |||||||||||||||
USD | 14,736 | HUF | 4,234,692 | HSB | 08/08/19 | — | 204 | |||||||||||||||
USD | 44,018 | HUF | 12,794,066 | HSB | 08/08/19 | — | 1,120 | |||||||||||||||
USD | 261,060 | HUF | 75,007,794 | JPM | 08/08/19 | — | 3,568 | |||||||||||||||
USD | 61,339 | ILS | 219,857 | SSB | 09/26/19 | — | 589 | |||||||||||||||
USD | 281,000 | JPY | 29,996,188 | HSB | 08/14/19 | 1,886 | — | |||||||||||||||
USD | 436,607 | JPY | 47,324,276 | HSB | 08/14/19 | — | 3,745 | |||||||||||||||
USD | 143,600 | JPY | 15,467,853 | MSC | 08/14/19 | — | 328 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 31
Lazard Global Dynamic Multi-Asset Portfolio (concluded)
Currency Purchased | Quantity | Currency Sold | Quantity | Counterparty | Settlement Date | Unrealized Appreciation | Unrealized Depreciation | |||||||||||||||
USD | 35,900 | NOK | 306,146 | HSB | 08/14/19 | $ | — | $ | 37 | |||||||||||||
USD | 119,216 | NOK | 1,040,142 | HSB | 08/14/19 | — | 2,880 | |||||||||||||||
USD | 186,224 | NOK | 1,624,364 | HSB | 08/14/19 | — | 4,450 | |||||||||||||||
USD | 287,720 | NOK | 2,437,561 | SSB | 09/26/19 | 1,309 | — | |||||||||||||||
USD | 216,350 | NZD | 328,547 | CIT | 08/14/19 | — | 4,569 | |||||||||||||||
USD | 64,196 | NZD | 97,494 | HSB | 08/14/19 | — | 1,360 | |||||||||||||||
USD | 182,489 | NZD | 277,124 | JPM | 08/14/19 | — | 3,852 | |||||||||||||||
USD | 256,208 | PLN | 979,882 | HSB | 08/14/19 | — | 6,524 | |||||||||||||||
USD | 146,918 | SGD | 201,054 | JPM | 08/14/19 | — | 1,789 | |||||||||||||||
USD | 56,327 | SGD | 76,163 | SSB | 09/26/19 | — | 37 | |||||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 66,819 | $ | 89,255 |
The accompanying notes are an integral part of these financial statements.
32 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 33
Description | Shares | Fair Value | ||||||
Lazard Opportunistic Strategies Portfolio (concluded) | ||||||||
Short-Term Investments | 15.0% | ||||||||
State Street Institutional Treasury Money Market Fund, Premier Class, 2.17% (7 day yield) (Cost $13,341,147) | 13,341,147 | $ | 13,341,147 | |||||
Total Investments excluding Securities Sold Short | 117.6% (Cost $99,756,524) | 104,601,296 | |||||||
Securities Sold Short | (10.1)% | ||||||||
Exchange-Traded Funds | (10.1)% | ||||||||
iShares Core S&P Small-Cap ETF | (39,650 | ) | (3,103,802 | ) | ||||
iShares MSCI ACWI ETF | (22,600 | ) | (1,665,846 | ) | ||||
iShares Russell 1000 ETF | (17,100 | ) | (2,783,709 | ) | ||||
SPDR S&P 500 ETF Trust | (5,050 | ) | (1,479,650 | ) | ||||
Total Securities Sold Short (Proceeds ($8,860,718)) | (9,033,007 | ) | ||||||
Total Investments | 107.5% (Cost $90,895,806) | $ | 95,568,289 | ||||||
Liabilities in Excess of Cash and Other Assets | (7.5)% | (6,628,587 | ) | ||||||
Net Assets | 100.0% | $ | 88,939,702 |
The accompanying notes are an integral part of these financial statements.
34 Semi-Annual Report
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 35
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
China | 0.4% | ||||||||
China Vanke Co., Ltd., Class H | 19,400 | $ | 72,817 | |||||
Denmark | 0.1% | ||||||||
Novo Nordisk A/S, Class B | 169 | 8,621 | ||||||
Scandinavian Tobacco Group A/S | 713 | 8,311 | ||||||
16,932 | ||||||||
Finland | 0.1% | ||||||||
Cramo Oyj | 496 | 11,773 | ||||||
France | 2.2% | ||||||||
AXA SA | 429 | 11,270 | ||||||
Engie SA | 698 | 10,599 | ||||||
Eutelsat Communications SA | 6,347 | 118,714 | ||||||
L’Oreal SA | 163 | 46,430 | ||||||
Unibail-Rodamco-Westfield | 276 | 41,350 | ||||||
Vinci SA | 1,692 | 173,477 | ||||||
401,840 | ||||||||
Germany | 1.6% | ||||||||
ADO Properties SA | 1,427 | 59,031 | ||||||
Allianz SE | 56 | 13,497 | ||||||
Aroundtown SA | 3,323 | 27,379 | ||||||
Deutsche Lufthansa AG | 831 | 14,240 | ||||||
Fraport AG | 1,309 | 112,528 | ||||||
Vonovia SE | 1,189 | 56,785 | ||||||
283,460 | ||||||||
Hong Kong | 2.6% | ||||||||
Dairy Farm International Holdings, Ltd. | 3,300 | 23,596 | ||||||
Jardine Matheson Holdings, Ltd. | 72 | 4,538 | ||||||
Link Real Estate Investment Trust | 9,000 | 110,700 | ||||||
Power Assets Holdings, Ltd. | 18,000 | 129,417 | ||||||
Sun Hung Kai Properties, Ltd. | 7,500 | 127,368 | ||||||
Wharf Real Estate Investment Co., Ltd. | 11,000 | 77,276 | ||||||
472,895 |
The accompanying notes are an integral part of these financial statements.
36 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
Israel | 0.2% | ||||||||
Azrieli Group, Ltd. | 521 | $ | 34,937 | |||||
Italy | 4.8% | ||||||||
ASTM SpA | 1,464 | 47,278 | ||||||
Atlantia SpA | 6,689 | 174,028 | ||||||
Enel SpA | 5,251 | 36,690 | ||||||
Hera SpA | 18,763 | 71,811 | ||||||
Italgas SpA | 22,374 | 150,215 | ||||||
Poste Italiane SpA | 1,424 | 15,001 | ||||||
Snam SpA | 31,345 | 155,946 | ||||||
Societa Iniziative Autostradali e Servizi SpA | 1,049 | 19,455 | ||||||
Terna SpA | 30,634 | 195,179 | ||||||
865,603 | ||||||||
Japan | 2.4% | ||||||||
East Japan Railway Co. | 200 | 18,730 | ||||||
GLP J-Reit | 54 | 61,537 | ||||||
Invincible Investment Corp. REIT | 98 | 50,751 | ||||||
KDDI Corp. | 400 | 10,190 | ||||||
Mitsubishi Estate Co., Ltd. | 6,600 | 123,122 | ||||||
Mitsui Fudosan Co., Ltd. | 4,200 | 101,981 | ||||||
NTT DOCOMO, Inc. | 1,100 | 25,672 | ||||||
Tokio Marine Holdings, Inc. | 300 | 15,056 | ||||||
West Japan Railway Co. | 300 | 24,337 | ||||||
431,376 | ||||||||
Luxembourg | 0.8% | ||||||||
SES SA | 8,679 | 135,902 | ||||||
Mexico | 0.3% | ||||||||
Alpek SAB de CV | 12,855 | 16,148 | ||||||
Corp Inmobiliaria Vesta SAB de CV | 25,700 | 37,933 | ||||||
54,081 | ||||||||
Netherlands | 0.1% | ||||||||
Intertrust NV | 498 | 10,280 | ||||||
NN Group NV | 167 | 6,723 | ||||||
17,003 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 37
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
New Zealand | 0.1% | ||||||||
Spark New Zealand, Ltd. | 4,267 | $ | 11,470 | |||||
Norway | 0.1% | ||||||||
Mowi ASA | 343 | 8,021 | ||||||
Salmar ASA | 184 | 8,002 | ||||||
16,023 | ||||||||
Philippines | 0.4% | ||||||||
Megaworld Corp. | 581,400 | 69,213 | ||||||
Singapore | 0.7% | ||||||||
CapitaLand, Ltd. | 27,900 | 72,816 | ||||||
DBS Group Holdings, Ltd. | 359 | 6,891 | ||||||
Jardine Cycle & Carriage, Ltd. | 800 | 21,462 | ||||||
Singapore Airlines, Ltd. | 900 | 6,177 | ||||||
Singapore Technologies Engineering, Ltd. | 6,100 | 18,698 | ||||||
126,044 | ||||||||
South Korea | 0.1% | ||||||||
S-Oil Corp. | 187 | 13,552 | ||||||
Spain | 0.4% | ||||||||
Iberdrola SA | 1,155 | 11,521 | ||||||
Merlin Properties Socimi SA REIT | 3,984 | 55,271 | ||||||
66,792 | ||||||||
Sweden | 0.0% | ||||||||
Swedish Match AB | 164 | 6,931 | ||||||
Switzerland | 0.5% | ||||||||
Novartis AG | 173 | 15,824 | ||||||
Roche Holding AG | 259 | 72,874 | ||||||
88,698 | ||||||||
United Arab Emirates | 0.2% | ||||||||
Emaar Properties PJSC | 22,181 | 26,714 |
The accompanying notes are an integral part of these financial statements.
38 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
United Kingdom | 5.1% | ||||||||
Admiral Group PLC | 1,150 | $ | 32,310 | |||||
Ashtead Group PLC | 386 | 11,071 | ||||||
Derwent London PLC REIT | 1,069 | 42,314 | ||||||
Great Portland Estates PLC REIT | 4,320 | 37,551 | ||||||
Howden Joinery Group PLC | 3,687 | 23,741 | ||||||
Imperial Brands PLC | 1,376 | 32,309 | ||||||
International Consolidated Airlines Group SA | 1,761 | 10,682 | ||||||
National Grid PLC | 16,540 | 175,773 | ||||||
Pennon Group PLC | 11,565 | 109,103 | ||||||
Segro PLC REIT | 8,022 | 74,408 | ||||||
Severn Trent PLC | 6,104 | 158,836 | ||||||
The Go-Ahead Group PLC | 298 | 7,463 | ||||||
Unilever NV | 384 | 23,391 | ||||||
United Utilities Group PLC | 16,954 | 168,686 | ||||||
907,638 | ||||||||
United States | 25.8% | ||||||||
AbbVie, Inc. | 106 | 7,708 | ||||||
Aflac, Inc. | 321 | 17,594 | ||||||
Agilent Technologies, Inc. | 131 | 9,782 | ||||||
Alexandria Real Estate Equities, Inc. REIT | 652 | 91,991 | ||||||
American Electric Power Co., Inc. | 1,900 | 167,219 | ||||||
American Express Co. | 79 | 9,752 | ||||||
American Homes 4 Rent, Class A REIT | 3,132 | 76,139 | ||||||
American Tower Corp. REIT | 410 | 83,824 | ||||||
Americold Realty Trust REIT | 2,637 | 85,492 | ||||||
Amgen, Inc. | 40 | 7,371 | ||||||
Aon PLC | 395 | 76,227 | ||||||
Apple, Inc. | 153 | 30,282 | ||||||
AutoZone, Inc. (*) | 15 | 16,492 | ||||||
Bank of America Corp. | 411 | 11,919 | ||||||
Best Buy Co., Inc. | 109 | 7,601 | ||||||
Biogen, Inc. (*) | 41 | 9,589 | ||||||
Boston Properties, Inc. REIT | 597 | 77,013 | ||||||
Bristol-Myers Squibb Co. | 209 | 9,478 | ||||||
Broadridge Financial Solutions, Inc. | 72 | 9,193 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 39
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
Burlington Stores, Inc. (*) | 48 | $ | 8,167 | |||||
Campbell Soup Co. | 457 | 18,312 | ||||||
Cboe Global Markets, Inc. | 109 | 11,296 | ||||||
CF Industries Holdings, Inc. | 385 | 17,983 | ||||||
Charles River Laboratories International, Inc. (*) | 106 | 15,041 | ||||||
Church & Dwight Co., Inc. | 181 | 13,224 | ||||||
Cigna Corp. | 172 | 27,099 | ||||||
Cisco Systems, Inc. | 153 | 8,374 | ||||||
Colgate-Palmolive Co. | 209 | 14,979 | ||||||
Consolidated Edison, Inc. | 1,230 | 107,846 | ||||||
Copart, Inc. (*) | 352 | 26,308 | ||||||
Costco Wholesale Corp. | 136 | 35,939 | ||||||
Cracker Barrel Old Country Store, Inc. | 64 | 10,927 | ||||||
CSX Corp. | 1,389 | 107,467 | ||||||
Darden Restaurants, Inc. | 187 | 22,764 | ||||||
Edison International | 134 | 9,033 | ||||||
Eli Lilly & Co. | 441 | 48,858 | ||||||
Equinix, Inc. REIT | 310 | 156,330 | ||||||
Equity Lifestyle Properties, Inc. REIT | 747 | 90,641 | ||||||
Essential Properties Realty Trust, Inc. REIT | 3,007 | 60,260 | ||||||
Essex Property Trust, Inc. REIT | 333 | 97,213 | ||||||
Exelon Corp. | 333 | 15,964 | ||||||
Extra Space Storage, Inc. REIT | 573 | 60,795 | ||||||
F5 Networks, Inc. (*) | 173 | 25,194 | ||||||
Fastenal Co. | 256 | 8,343 | ||||||
Ferguson PLC (*) | 227 | 16,180 | ||||||
H&R Block, Inc. | 382 | 11,193 | ||||||
HCP, Inc. REIT | 927 | 29,645 | ||||||
Hilton Worldwide Holdings, Inc. | 1,011 | 98,815 | ||||||
Honeywell International, Inc. | 69 | 12,047 | ||||||
Hudson Pacific Properties, Inc. REIT | 1,605 | 53,398 | ||||||
Humana, Inc. | 72 | 19,102 | ||||||
IAA, Inc. (*) | 149 | 5,778 | ||||||
Intel Corp. | 566 | 27,094 | ||||||
Intercontinental Exchange, Inc. | 243 | 20,883 | ||||||
IQVIA Holdings, Inc. (*) | 153 | 24,618 |
The accompanying notes are an integral part of these financial statements.
40 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
Johnson & Johnson | 486 | $ | 67,690 | |||||
JPMorgan Chase & Co. | 208 | 23,254 | ||||||
Kansas City Southern | 1,420 | 172,984 | ||||||
KAR Auction Services, Inc. | 149 | 3,725 | ||||||
Kimberly-Clark Corp. | 304 | 40,517 | ||||||
Lamb Weston Holdings, Inc. | 214 | 13,559 | ||||||
Lockheed Martin Corp. | 101 | 36,718 | ||||||
Lowe’s Cos., Inc. | 72 | 7,266 | ||||||
Marathon Petroleum Corp. | 345 | 19,279 | ||||||
Marsh & McLennan Cos., Inc. | 213 | 21,247 | ||||||
MasterCard, Inc., Class A | 192 | 50,790 | ||||||
McDonald’s Corp. | 101 | 20,974 | ||||||
Merck & Co., Inc. | 550 | 46,117 | ||||||
MetLife, Inc. | 171 | 8,494 | ||||||
Mettler-Toledo International, Inc. (*) | 51 | 42,840 | ||||||
Nasdaq, Inc. | 330 | 31,736 | ||||||
NIKE, Inc., Class B | 291 | 24,429 | ||||||
Norfolk Southern Corp. | 919 | 183,184 | ||||||
Northrop Grumman Corp. | 125 | 40,389 | ||||||
Olin Corp. | 682 | 14,943 | ||||||
Park Hotels & Resorts, Inc. REIT | 997 | 27,477 | ||||||
Paychex, Inc. | 465 | 38,265 | ||||||
PepsiCo, Inc. | 136 | 17,834 | ||||||
Pfizer, Inc. | 195 | 8,447 | ||||||
Pinnacle West Capital Corp. | 87 | 8,186 | ||||||
Prologis, Inc. REIT | 1,875 | 150,187 | ||||||
Quest Diagnostics, Inc. | 105 | 10,690 | ||||||
Raytheon Co. | 140 | 24,343 | ||||||
Republic Services, Inc. | 828 | 71,738 | ||||||
Ross Stores, Inc. | 272 | 26,961 | ||||||
Simon Property Group, Inc. REIT | 771 | 123,175 | ||||||
Starbucks Corp. | 727 | 60,944 | ||||||
Synchrony Financial | 285 | 9,881 | ||||||
Synovus Financial Corp. | 244 | 8,540 | ||||||
Sysco Corp. | 844 | 59,688 | ||||||
Target Corp. | 193 | 16,716 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 41
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
Texas Instruments, Inc. | 182 | $ | 20,886 | |||||
The Allstate Corp. | 271 | 27,558 | ||||||
The Boeing Co. | 35 | 12,740 | ||||||
The Estee Lauder Cos., Inc., Class A | 54 | 9,888 | ||||||
The Hershey Co. | 317 | 42,487 | ||||||
The Home Depot, Inc. | 111 | 23,085 | ||||||
The Macerich Co. REIT | 1,493 | 50,001 | ||||||
The Procter & Gamble Co. | 749 | 82,128 | ||||||
The TJX Cos., Inc. | 1,050 | 55,524 | ||||||
The Toro Co. | 154 | 10,303 | ||||||
Thermo Fisher Scientific, Inc. | 204 | 59,911 | ||||||
Tyson Foods, Inc., Class A | 138 | 11,142 | ||||||
Union Pacific Corp. | 970 | 164,037 | ||||||
UnitedHealth Group, Inc. | 181 | 44,166 | ||||||
Verizon Communications, Inc. | 126 | 7,198 | ||||||
Visa, Inc., Class A | 258 | 44,776 | ||||||
Vulcan Materials Co. | 225 | 30,895 | ||||||
Walgreens Boots Alliance, Inc. | 162 | 8,857 | ||||||
Walmart, Inc. | 205 | 22,650 | ||||||
Waste Connections, Inc. | 199 | 19,020 | ||||||
Waste Management, Inc. | 656 | 75,683 | ||||||
Waters Corp. (*) | 31 | 6,672 | ||||||
Weyerhaeuser Co. REIT | 3,245 | 85,473 | ||||||
WW Grainger, Inc. | 52 | 13,948 | ||||||
Zoetis, Inc. | 90 | 10,214 | ||||||
4,614,225 | ||||||||
Total Common Stocks (Cost $9,058,905) | 9,976,171 | |||||||
Exchange-Traded Funds | 2.1% | ||||||||
SPDR Gold Shares (*), (Δ) (Cost $344,912) | 2,874 | 382,816 |
The accompanying notes are an integral part of these financial statements.
42 Semi-Annual Report
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||||
Foreign Government Obligations | 9.2% | ||||||||||
Australia | 0.3% | ||||||||||
Australia Government Bonds, 3.000%, 09/20/25 | AUD | 56 | $ | 57,966 | ||||||
�� | ||||||||||
Canada | 0.8% | ||||||||||
Canadian Government Real Return Bonds: 4.250%, 12/01/26 | CAD | 50 | 49,463 | |||||||
2.000%, 12/01/41 | CAD | 88 | 90,617 | |||||||
140,080 | ||||||||||
Denmark | 0.8% | ||||||||||
Denmark Inflation Linked Government Bonds, 0.100%, 11/15/23 | DKK | 912 | 149,599 | |||||||
France | 1.3% | ||||||||||
Government of France, 1.850%, 07/25/27 | EUR | 171 | 242,626 | |||||||
Italy | 1.5% | ||||||||||
Italy Buoni Poliennali Del Tesoro: 0.100%, 05/15/22 | EUR | 148 | 166,341 | |||||||
2.350%, 09/15/24 | EUR | 79 | 96,581 | |||||||
262,922 | ||||||||||
New Zealand | 0.6% | ||||||||||
New Zealand Government Bonds: 3.000%, 09/20/30 | NZD | 15 | 13,609 | |||||||
3.219%, 09/20/30 | NZD | 105 | 95,265 | |||||||
108,874 | ||||||||||
Spain | 1.5% | ||||||||||
Spain Government Inflation Linked Bonds: 0.300%, 11/30/21 | EUR | 135 | 158,634 | |||||||
1.800%, 11/30/24 | EUR | 80 | 104,738 | |||||||
263,372 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 43
Description | Security Currency | Principal Amount (000) | Fair Value | |||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||||
Sweden | 0.3% | ||||||||||
Sweden Inflation Linked Bonds, 3.500%, 12/01/28 | SEK | 215 | $ | 47,245 | ||||||
United Kingdom | 2.1% | ||||||||||
United Kingdom Gilt Inflation Linked: 1.875%, 11/22/22 | GBP | 143 | 211,253 | |||||||
0.750%, 03/22/34 | GBP | 82 | 159,069 | |||||||
370,322 | ||||||||||
Total Foreign Government Obligations (Cost $1,573,414) | 1,643,006 | |||||||||
US Treasury Securities | 16.2% | ||||||||||
Treasury Inflation Protected Securities: 0.125%, 04/15/20 | USD | 900 | 890,665 | |||||||
1.125%, 01/15/21 | USD | 1,001 | 1,008,678 | |||||||
2.375%, 01/15/25 | USD | 291 | 325,638 | |||||||
2.500%, 01/15/29 | USD | 550 | 661,433 | |||||||
Total US Treasury Securities (Cost $2,878,678) | 2,886,414 | |||||||||
Short-Term Investments | 15.8% | ||||||||||
State Street Institutional Treasury | 2,817,949 | $ | 2,817,949 |
The accompanying notes are an integral part of these financial statements.
44 Semi-Annual Report
Description | Shares | Fair Value | ||||||
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued) | ||||||||
Total Investments | 99.1% (Cost $16,673,858) (») | $ | 17,706,356 | ||||||
Cash and Other Assets in Excess of Liabilities | 0.9% | 168,154 | |||||||
Net Assets | 100.0% | $ | 17,874,510 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 45
Lazard Real Assets and Pricing Opportunities Portfolio (·) (continued)
Forward Currency Contracts open at June 30, 2019:
Currency | Currency | Settlement | Unrealized | Unrealized | |||||||||||||||||
Purchased | Quantity | Sold | Quantity | Counterparty | Date | Appreciation | Depreciation | ||||||||||||||
AUD | 29,478 | USD | 20,600 | MSC | 08/14/19 | $ | 92 | $ | — | ||||||||||||
GBP | 25,573 | USD | 32,800 | JPM | 08/14/19 | — | 252 | ||||||||||||||
JPY | 4,364,268 | USD | 40,262 | JPM | 08/14/19 | 334 | — | ||||||||||||||
JPY | 4,376,175 | USD | 40,372 | JPM | 08/14/19 | 335 | — | ||||||||||||||
NZD | 13,625 | USD | 9,000 | HSB | 08/14/19 | 154 | — | ||||||||||||||
NZD | 93,992 | USD | 61,471 | HSB | 08/14/19 | 1,673 | — | ||||||||||||||
SEK | 93,256 | USD | 9,900 | MSC | 08/14/19 | 173 | — | ||||||||||||||
USD | 10,220 | AUD | 14,731 | HSB | 08/14/19 | — | 121 | ||||||||||||||
USD | 44,552 | AUD | 63,832 | HSB | 08/14/19 | — | 254 | ||||||||||||||
USD | 353,232 | AUD | 509,743 | SSB | 09/26/19 | — | 4,977 | ||||||||||||||
USD | 23,956 | CAD | 32,232 | CIT | 08/14/19 | — | 687 | ||||||||||||||
USD | 36,849 | CAD | 48,611 | CIT | 09/26/19 | — | 342 | ||||||||||||||
USD | 20,325 | CAD | 26,726 | HSB | 08/14/19 | — | 109 | ||||||||||||||
USD | 41,190 | CAD | 54,885 | HSB | 08/14/19 | — | 773 | ||||||||||||||
USD | 46,049 | CAD | 61,920 | HSB | 08/14/19 | — | 1,294 | ||||||||||||||
USD | 17,582 | DKK | 115,651 | CIT | 08/14/19 | — | 110 | ||||||||||||||
USD | 131,997 | DKK | 870,195 | CIT | 08/14/19 | — | 1,125 | ||||||||||||||
USD | 751,563 | EUR | 656,918 | CIT | 09/26/19 | — | 722 | ||||||||||||||
USD | 94,261 | EUR | 83,280 | HSB | 07/11/19 | — | 545 | ||||||||||||||
USD | 673,531 | EUR | 595,426 | HSB | 07/11/19 | — | 4,307 | ||||||||||||||
USD | 592,775 | EUR | 518,110 | SSB | 09/26/19 | — | 551 | ||||||||||||||
USD | 88,555 | GBP | 68,061 | CIT | 08/14/19 | 1,931 | — | ||||||||||||||
USD | 44,288 | GBP | 34,846 | HSB | 08/14/19 | — | 63 | ||||||||||||||
USD | 231,260 | GBP | 177,757 | HSB | 08/14/19 | 5,020 | — | ||||||||||||||
USD | 605,611 | GBP | 475,266 | SSB | 09/26/19 | — | 320 | ||||||||||||||
USD | 122,961 | HKD | 960,436 | SSB | 09/26/19 | — | 48 | ||||||||||||||
USD | 80,038 | JPY | 8,675,840 | JPM | 08/14/19 | — | 664 | ||||||||||||||
USD | 734 | MXN | 14,304 | HSB | 08/14/19 | — | 6 | ||||||||||||||
USD | 132,977 | NZD | 201,938 | CIT | 08/14/19 | — | 2,687 | ||||||||||||||
USD | 10,345 | NZD | 15,710 | HSB | 08/14/19 | — | 210 | ||||||||||||||
USD | 13,419 | NZD | 20,346 | HSB | 08/14/19 | — | 250 | ||||||||||||||
USD | 50,534 | SEK | 483,252 | HSB | 08/14/19 | — | 1,664 | ||||||||||||||
USD | 5,618 | �� | SEK | 51,768 | JPM | 08/14/19 | 27 | — | |||||||||||||
Total gross unrealized appreciation/depreciation on Forward Currency Contracts | $ | 9,739 | $ | 22,081 |
The accompanying notes are an integral part of these financial statements.
46 Semi-Annual Report
Lazard Real Assets and Pricing Opportunities Portfolio (·) (concluded)
Futures Contracts open at June 30, 2019 (Δ):
Number of | Notional | Expiration | Notional | Fair | Unrealized | |||||||||||||||||
Type | Contracts | Amount | Date | Cost | Value | Depreciation | ||||||||||||||||
Natural Gas | 5 | $50,000 | 08/28/19 | $129,268 | $114,100 | $15,168 | ||||||||||||||||
Low Sulphur Gasoil | 1 | 100 | 09/12/19 | 61,511 | 60,050 | 1,461 | ||||||||||||||||
Cotton No. 2 | 1 | 50,000 | 12/06/19 | 33,239 | 33,040 | 199 | ||||||||||||||||
Total gross unrealized depreciation on Futures Contracts | $16,828 |
Total Return Swap Agreements open at June 30, 2019 (Δ):
Notional | Expiration | Payment | Unrealized | ||||||||||||||||
Pay | Currency | Counterparty | Amount | Date | Receive | Frequency | Depreciation | ||||||||||||
0.00% | USD | GSC | $2,439,700 | 10/24/19 | Appreciation, and dividends paid, on commodities in a custom momentum basket | Upon Maturity | $183,797 | ||||||||||||
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 47
The Lazard Funds, Inc.Notes to Portfolios of Investments
June 30, 2019 (unaudited)
(*) | Non-income producing security. |
(#) | Pursuant to Rule 144A under the Securities Act of 1933, these securities may only be traded among “qualified institutional buyers.” At June 30, 2019, these securities amounted to 1.2% of net assets of Lazard Global Dynamic Multi-Asset Portfolio. |
(§) | Variable and floating rate securities are securities for which interest rate changes are based on changes in a designated base rate. The rates shown are those in effect on June 30, 2019. |
(») | The Portfolio, at all times, maintains portfolio securities in sufficient amount to cover its obligations related to investments in forward currency contracts. |
(±) | Some or all of this security position has been pledged to cover collateral requirements on securities sold short. |
(·) | Lazard Real Assets and Pricing Opportunities Portfolio’s Portfolio of Investments and accompanying notes are presented on a consolidated basis. |
(Δ) | The security is owned by Lazard Real Assets and Pricing Opportunities Portfolio, Ltd., a wholly-owned subsidiary of the Lazard Real Assets and Pricing Opportunities Portfolio. See Note 1 in the Notes to Financial Statements. |
Security Abbreviations: | |||||
ADR | — | American Depositary Receipt | PJSC | — | Public Joint Stock Company |
BBSW | — | Bank Bill Swap Reference Rate | PRIBOR | — | Prague Interbank Offered Rate |
ETF | — | Exchange-Traded Fund | REIT | — | Real Estate Investment Trust |
Currency Abbreviations: | |||||
AUD | — | Australian Dollar | ILS | — | Israeli Shekel |
CAD | — | Canadian Dollar | JPY | — | Japanese Yen |
CHF | — | Swiss Franc | KRW | — | South Korean Won |
CLP | — | Chilean Peso | MXN | — | Mexican New Peso |
CZK | — | Czech Koruna | NOK | — | Norwegian Krone |
DKK | — | Danish Krone | NZD | — | New Zealand Dollar |
EUR | — | Euro | PLN | — | Polish Zloty |
GBP | — | British Pound Sterling | SEK | — | Swedish Krona |
HKD | — | Hong Kong Dollar | SGD | — | Singapore Dollar |
HUF | — | Hungarian Forint | USD | — | United States Dollar |
IDR | — | Indonesian Rupiah |
Counterparty Abbreviations: | |||||
CIT | — | Citibank NA | |||
HSB | — | HSBC Bank USA NA | |||
JPM | — | JPMorgan Chase Bank NA | |||
MSC | — | Morgan Stanley & Co. | |||
SSB | — | State Street Bank and Trust Co. |
The accompanying notes are an integral part of these financial statements.
48 Semi-Annual Report
Portfolio holdings by industry (as a percentage of net assets), for those Portfolios previously presented by country:
Industry† | Lazard Global Dynamic Multi-Asset Portfolio | Lazard Real Assets and Pricing Opportunities Portfolio | |||||||
Common Stocks and Corporate & Quasi Government Bonds | |||||||||
Aerospace & Defense | 2.0 | % | 0.7 | % | |||||
Airlines | 0.8 | 0.2 | |||||||
Auto Components | 0.1 | — | |||||||
Automobiles | 0.5 | — | |||||||
Banks | 5.8 | 1.3 | |||||||
Beverages | 2.4 | 0.1 | |||||||
Biotechnology | 0.5 | 0.4 | |||||||
Building Products | 0.2 | — | |||||||
Capital Markets | 2.5 | 0.5 | |||||||
Chemicals | 0.8 | 0.4 | |||||||
Commercial Services & Suppliers | 1.2 | 1.1 | |||||||
Communications Equipment | 1.1 | 0.2 | |||||||
Construction & Engineering | 0.4 | 1.0 | |||||||
Construction Materials | 0.1 | 0.2 | |||||||
Consumer Finance | 0.6 | 0.1 | |||||||
Distributors | 0.1 | 0.1 | |||||||
Diversified Consumer Services | — | 0.1 | |||||||
Diversified Financial Services | 1.0 | — | |||||||
Diversified Telecommunication Services | 1.3 | 0.5 | |||||||
Electric Utilities | 2.2 | 3.7 | |||||||
Electrical Equipment | 0.9 | — | |||||||
Electronic Equipment, Instruments & Components | 0.7 | — | |||||||
Energy Equipment & Services | 0.2 | — | |||||||
Equity Real Estate Investment Trusts (REITs) | 1.7 | 11.3 | |||||||
Entertainment | 0.8 | — | |||||||
Food & Staples Retailing | 1.4 | 1.4 | |||||||
Food Products | 1.0 | 0.6 | |||||||
Gas Utilities | 0.1 | 1.7 | |||||||
Health Care Equipment & Supplies | 1.1 | — | |||||||
Health Care Providers & Services | 1.2 | 0.6 | |||||||
Health Care Technology | 0.2 | — | |||||||
Hotels, Restaurants & Leisure | 2.9 | 1.2 | |||||||
Household Products | 1.4 | 0.8 | |||||||
Independent Power & Renewable Electricity Producers | 0.2 | 0.2 | |||||||
Industrial Conglomerates | 0.9 | 0.1 | |||||||
Insurance | 4.2 | 1.5 |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 49
Industry† | Lazard Global Dynamic Multi-Asset Portfolio | Lazard Real Assets and Pricing Opportunities Portfolio | |||||||
Interactive Media & Services | 1.1 | % | — | % | |||||
Internet & Direct Marketing Retail | 1.0 | — | |||||||
IT Services | 3.6 | 0.8 | |||||||
Leisure Products | 0.5 | — | |||||||
Life Sciences Tools & Services | 1.4 | 0.9 | |||||||
Machinery | 1.3 | 0.1 | |||||||
Media | 0.8 | 1.4 | |||||||
Metals & Mining | 1.4 | 0.4 | |||||||
Multiline Retail | 0.4 | 0.2 | |||||||
Multi-Utilities | 0.9 | 2.4 | |||||||
Oil, Gas & Consumable Fuels | 2.7 | 0.2 | |||||||
Personal Products | 2.1 | 0.4 | |||||||
Pharmaceuticals | 5.8 | 1.6 | |||||||
Professional Services | 1.5 | 0.1 | |||||||
Real Estate Management & Development | 1.4 | 5.0 | |||||||
Road & Rail | 0.7 | 4.0 | |||||||
Semiconductors & Semiconductor Equipment | 1.2 | 0.2 | |||||||
Software | 2.8 | — | |||||||
Specialty Retail | 2.0 | 0.8 | |||||||
Technology Hardware, Storage & Peripherals | 1.6 | 0.2 | |||||||
Textiles, Apparel & Luxury Goods | 1.1 | 0.1 | |||||||
Tobacco | 0.5 | 0.3 | |||||||
Trading Companies & Distributors | 0.5 | 0.5 | |||||||
Transportation Infrastructure | — | 3.5 | |||||||
Water Utilities | — | 2.4 | |||||||
Wireless Telecommunication Services | 1.9 | 0.3 | |||||||
Subtotal | 80.7 | 55.8 | |||||||
Exchange- Traded Funds | — | 2.1 | |||||||
Foreign Government Obligations | 10.8 | 9.2 | |||||||
Supranational Bonds | 2.8 | — | |||||||
US Government Securities | 0.4 | — | |||||||
US Municipal Bonds | 0.8 | — | |||||||
US Treasury Securities | 2.4 | 16.2 | |||||||
Short-Term Investments | 2.0 | 15.8 | |||||||
Total Investments | 99.9 | % | 99.1 | % |
† | Industry classifications may be different than those used for compliance monitoring purposes. |
The accompanying notes are an integral part of these financial statements.
50 Semi-Annual Report
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Semi-Annual Report 51
The Lazard Funds, Inc.Statements of Assets and Liabilities (unaudited)
Lazard | Lazard | ||||||||||
Global Dynamic | Opportunistic | ||||||||||
Multi-Asset | Strategies | ||||||||||
June 30, 2019 | Portfolio | Portfolio | |||||||||
ASSETS | |||||||||||
Investments in securities, at fair value | $ | 49,527,134 | $ | 104,601,296 | |||||||
Cash | 1,268 | — | |||||||||
Cash collateral due from broker on futures contracts and swap agreements | — | — | |||||||||
Foreign currency, at fair value | 11,796 | 220 | |||||||||
Receivables for: | |||||||||||
Dividends and interest | 177,889 | 107,108 | |||||||||
Capital stock sold | — | 50,891 | |||||||||
Investments sold | 194,467 | — | |||||||||
Amount due from Investment Manager (Note 3) | — | — | |||||||||
Gross unrealized appreciation on forward currency contracts | 66,819 | — | |||||||||
Prepaid expenses | 25,186 | 27,729 | |||||||||
Total assets | 50,004,559 | 104,787,244 | |||||||||
LIABILITIES | |||||||||||
Securities sold short, at fair value | — | 9,033,007 | |||||||||
Due to custodian | — | 9,881 | |||||||||
Payables for: | |||||||||||
Management fees | 13,048 | 59,817 | |||||||||
Accrued professional services | 36,871 | 29,530 | |||||||||
Accrued custodian fees | 29,846 | 12,229 | |||||||||
Accrued distribution fees | 60 | — | |||||||||
Investments purchased | 274,846 | 6,686,903 | |||||||||
Dividends on securities sold short | — | 7,230 | |||||||||
Variation margin on open futures contracts | — | — | |||||||||
Gross unrealized depreciation on: | |||||||||||
Forward currency contracts | 89,255 | — | |||||||||
Swap agreements | — | — | |||||||||
Other accrued expenses and payables | 6,646 | 8,944 | |||||||||
Total liabilities | 450,572 | 15,847,541 | |||||||||
Net assets | $ | 49,553,987 | $ | 88,939,703 | |||||||
NET ASSETS | |||||||||||
Paid in capital | $ | 46,235,000 | $ | 84,672,247 | |||||||
Distributable earnings (Accumulated loss) | 3,318,987 | 4,267,455 | |||||||||
Net assets | $ | 49,553,987 | $ | 88,939,702 | |||||||
Institutional Shares | |||||||||||
Net assets | $ | 49,269,827 | $ | 88,706,851 | |||||||
Shares of capital stock outstanding* | 4,746,950 | 9,132,604 | |||||||||
Net asset value, offering and redemption price per share | $ | 10.38 | $ | 9.71 | |||||||
Open Shares | |||||||||||
Net assets | $ | 284,160 | $ | 232,851 | |||||||
Shares of capital stock outstanding* | 27,410 | 24,140 | |||||||||
Net asset value, offering and redemption price per share | $ | 10.37 | $ | 9.65 | |||||||
Cost of investments in securities | $ | 46,466,971 | $ | 99,756,524 | |||||||
Proceeds received from securities sold short | $ | — | $ | 8,860,718 | |||||||
Cost of foreign currency | $ | 11,793 | $ | 219 |
* | $0.001 par value, 6,900,000,000 shares authorized for the Portfolios in total. |
(a) | Consolidated Statement of Assets and Liabilities. |
The accompanying notes are an integral part of these financial statements.
52 Semi-Annual Report
Lazard | |||||
Real Assets and | |||||
Pricing Opportunities | |||||
Portfolio (a) | |||||
$ | 17,706,356 | ||||
— | |||||
363,255 | |||||
4,566 | |||||
68,175 | |||||
20 | |||||
— | |||||
5,315 | |||||
9,739 | |||||
24,902 | |||||
18,182,328 | |||||
— | |||||
— | |||||
— | |||||
41,320 | |||||
11,719 | |||||
10 | |||||
41,965 | |||||
— | |||||
1,517 | |||||
22,081 | |||||
183,797 | |||||
5,409 | |||||
307,818 | |||||
$ | 17,874,510 | ||||
$ | 17,245,478 | ||||
629,032 | |||||
$ | 17,874,510 | ||||
$ | 17,826,914 | ||||
1,714,377 | |||||
$ | 10.40 | ||||
$ | 47,596 | ||||
4,585 | |||||
$ | 10.38 | ||||
$ | 16,673,858 | ||||
$ | — | ||||
$ | 4,566 |
Semi-Annual Report 53
The Lazard Funds, Inc.Statements of Operations (unaudited)
Lazard | Lazard | ||||||||||
Global Dynamic | Opportunistic | ||||||||||
Multi-Asset | Strategies | ||||||||||
For the Period Ended June 30, 2019 | Portfolio | Portfolio | |||||||||
Investment Income (Loss) | |||||||||||
Income | |||||||||||
Dividends | $ | 383,018 | $ | 814,357 | |||||||
Interest | 202,900 | 215,642 | |||||||||
Total investment income* | 585,918 | 1,029,999 | |||||||||
Expenses | |||||||||||
Management fees (Note 3) | 185,865 | 492,658 | |||||||||
Professional services | 24,540 | 24,243 | |||||||||
Registration fees | 17,608 | 18,819 | |||||||||
Custodian fees | 75,772 | 17,559 | |||||||||
Administration fees | 10,267 | 13,521 | |||||||||
Directors’ fees and expenses | 3,464 | 4,829 | |||||||||
Shareholders’ services | 2,809 | 3,952 | |||||||||
Shareholders’ reports | 2,042 | 3,522 | |||||||||
Distribution fees (Open Shares) | 330 | 327 | |||||||||
Other | 3,309 | 4,228 | |||||||||
Total gross expenses before interest expense | 326,006 | 583,658 | |||||||||
Interest expense | — | 30,307 | |||||||||
Dividend expense | — | 80,883 | |||||||||
Total gross expenses | 326,006 | 694,848 | |||||||||
Management fees waived and expenses reimbursed | (116,408 | ) | (80,510 | ) | |||||||
Total net expenses | 209,598 | 614,338 | |||||||||
Net investment income (loss) | 376,320 | 415,661 | |||||||||
Net Realized and Unrealized Gain (Loss) on Investments, Securities Sold Short, Foreign Currency Transactions, Forward Currency Contracts, Futures Contracts and Swap Agreements | |||||||||||
Net realized gain (loss) on: | |||||||||||
Investments | 246,577 | 539,427 | |||||||||
Securities sold short | — | 1,566,028 | |||||||||
Foreign currency transactions | (3,357 | ) | — | ||||||||
Forward currency contracts | 22,579 | — | |||||||||
Futures contracts | — | — | |||||||||
Swap agreements | — | — | |||||||||
Total net realized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts and swap agreements | 265,799 | 2,105,455 | |||||||||
Net change in unrealized appreciation (depreciation) on: | |||||||||||
Investments | 4,657,078 | 8,673,480 | |||||||||
Securities sold short | — | (172,289 | ) | ||||||||
Foreign currency translations | 726 | (1 | ) | ||||||||
Forward currency contracts | (139,521 | ) | — | ||||||||
Futures contracts | — | — | |||||||||
Swap agreements | — | — | |||||||||
Total net change in unrealized appreciation (depreciation) on investments, securities sold short, foreign currency translations, forward currency contracts, futures contracts and swap agreements | 4,518,283 | 8,501,190 | |||||||||
Net realized and unrealized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts and swap agreements | 4,784,082 | 10,606,645 | |||||||||
Net increase (decrease) in net assets resulting from operations | $ | 5,160,402 | $ | 11,022,306 | |||||||
* Net of foreign withholding taxes of | $ | 28,197 | $ | — |
(a) | Consolidated Statement of Operations. |
The accompanying notes are an integral part of these financial statements.
54 Semi-Annual Report
Lazard | |||||
Real Assets and | |||||
Pricing Opportunities | |||||
Portfolio (a) | |||||
$ | 174,856 | ||||
76,159 | |||||
251,015 | |||||
60,445 | |||||
27,807 | |||||
12,438 | |||||
45,190 | |||||
8,442 | |||||
7,816 | |||||
2,717 | |||||
2,080 | |||||
57 | |||||
4,930 | |||||
171,922 | |||||
— | |||||
— | |||||
171,922 | |||||
(94,111 | ) | ||||
77,811 | |||||
173,204 | |||||
(99,150 | ) | ||||
— | |||||
(1,107 | ) | ||||
86,256 | |||||
(63,095 | ) | ||||
(35,103 | ) | ||||
(112,199 | ) | ||||
1,623,594 | |||||
— | |||||
68 | |||||
(21,404 | ) | ||||
4,598 | |||||
98,858 | |||||
1,705,714 | |||||
1,593,515 | |||||
$ | 1,766,719 | ||||
$ | 13,147 |
Semi-Annual Report 55
The Lazard Funds, Inc.Statements of Changes in Net Assets
Lazard | |||||||||||
Global Dynamic Multi-Asset Portfolio | |||||||||||
Six Months Ended | Year Ended | ||||||||||
June 30, 2019 | December 31, | ||||||||||
(unaudited) | 2018 | ||||||||||
Increase (Decrease) in Net Assets | |||||||||||
Operations | |||||||||||
Net investment income (loss) | $ | 376,320 | $ | 734,002 | |||||||
Net realized gain (loss) on investments, securities sold short, foreign currency transactions, forward currency contracts, futures contracts and swap agreements | 265,799 | 5,372,312 | |||||||||
Net change in unrealized appreciation (depreciation) on investments, securities sold short, foreign currency translations, forward currency contracts, futures contracts and swap agreements | 4,518,283 | (9,026,128 | ) | ||||||||
Net increase (decrease) in net assets resulting from operations | 5,160,402 | (2,919,814 | ) | ||||||||
Distributions to shareholders (Note 2(h)) | |||||||||||
Institutional Shares | — | (5,801,393 | ) | ||||||||
Open Shares | — | (57,021 | ) | ||||||||
Return of capital | |||||||||||
Institutional Shares | — | — | |||||||||
Open Shares | — | — | |||||||||
Net decrease in net assets resulting from distributions | — | (5,858,414 | ) | ||||||||
Capital stock transactions | |||||||||||
Net proceeds from sales | |||||||||||
Institutional Shares | 2,384,805 | 4,837,074 | |||||||||
Open Shares | 36,625 | 64,758 | |||||||||
Net proceeds from reinvestment of distributions | |||||||||||
Institutional Shares | — | 5,801,393 | |||||||||
Open Shares | — | 57,021 | |||||||||
Cost of shares redeemed | |||||||||||
Institutional Shares | (824,494 | ) | (28,135,810 | ) | |||||||
Open Shares | (6,095 | ) | (218,269 | ) | |||||||
Net increase (decrease) in net assets from capital stock transactions | 1,590,841 | (17,593,833 | ) | ||||||||
Total increase (decrease) in net assets | 6,751,243 | (26,372,061 | ) | ||||||||
Net assets at beginning of period | 42,802,744 | 69,174,805 | |||||||||
Net assets at end of period | $ | 49,553,987 | $ | 42,802,744 |
The accompanying notes are an integral part of these financial statements.
56 Semi-Annual Report
Lazard | Lazard Real Assets and | ||||||||||||||||||||
Opportunistic Strategies Portfolio | Pricing Opportunities Portfolio (a) | ||||||||||||||||||||
Six Months Ended | Year Ended | Six Months Ended | Year Ended | ||||||||||||||||||
June 30, 2019 | December 31, | June 30, 2019 | December 31, | ||||||||||||||||||
(unaudited) | 2018 | (unaudited) | 2018 | ||||||||||||||||||
$ | 415,661 | $ | 1,726,796 | $ | 173,204 | $ | 272,790 | ||||||||||||||
2,105,455 | (572,649 | ) | (112,199 | ) | 541,686 | ||||||||||||||||
8,501,190 | (16,944,250 | ) | 1,705,714 | (2,134,963 | ) | ||||||||||||||||
11,022,306 | (15,790,103 | ) | 1,766,719 | (1,320,487 | ) | ||||||||||||||||
— | (6,028,662 | ) | (85,738 | ) | (831,453 | ) | |||||||||||||||
— | (17,872 | ) | (172 | ) | (2,339 | ) | |||||||||||||||
— | (262,110 | ) | — | — | |||||||||||||||||
— | (777 | ) | — | — | |||||||||||||||||
— | (6,309,421 | ) | (85,910 | ) | (833,792 | ) | |||||||||||||||
5,117,130 | 18,043,749 | 2,112 | 439,718 | ||||||||||||||||||
6,119 | 96,400 | 511 | 3,168 | ||||||||||||||||||
— | 5,917,185 | 85,738 | 831,453 | ||||||||||||||||||
— | 18,147 | 172 | 2,339 | ||||||||||||||||||
(30,185,127 | ) | (50,917,387 | ) | (101,112 | ) | (771,616 | ) | ||||||||||||||
(89,545 | ) | (184,943 | ) | (103 | ) | (91,095 | ) | ||||||||||||||
(25,151,423 | ) | (27,026,849 | ) | (12,682 | ) | 413,967 | |||||||||||||||
(14,129,117 | ) | (49,126,373 | ) | 1,668,127 | (1,740,312 | ) | |||||||||||||||
103,068,819 | 152,195,192 | 16,206,383 | 17,946,695 | ||||||||||||||||||
$ | 88,939,702 | $ | 103,068,819 | $ | 17,874,510 | $ | 16,206,383 |
Semi-Annual Report 57
Lazard Global Dynamic Multi-Asset Portfolio | ||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||
Shares issued and redeemed | ||||||||
Institutional Shares | ||||||||
Shares outstanding at beginning of period | 4,593,006 | 5,986,168 | ||||||
Shares sold | 235,247 | 419,838 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 636,322 | ||||||
Shares redeemed | (81,303 | ) | (2,449,322 | ) | ||||
Net increase (decrease) | 153,944 | (1,393,162 | ) | |||||
Shares outstanding at end of period | 4,746,950 | 4,593,006 | ||||||
Open Shares | ||||||||
Shares outstanding at beginning of period | 24,305 | 36,012 | ||||||
Shares sold | 3,708 | 5,633 | ||||||
Shares issued to shareholders from reinvestment of distributions | — | 6,247 | ||||||
Shares redeemed | (603 | ) | (23,587 | ) | ||||
Net increase (decrease) | 3,105 | (11,707 | ) | |||||
Shares outstanding at end of period | 27,410 | 24,305 |
The accompanying notes are an integral part of these financial statements.
58 Semi-Annual Report
Lazard Opportunistic Strategies Portfolio | Lazard Real Assets and Pricing Opportunities Portfolio (a) | |||||||||||||||
Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | Six Months Ended June 30, 2019 (unaudited) | Year Ended December 31, 2018 | |||||||||||||
11,766,647 | 14,316,598 | 1,715,687 | 1,662,975 | |||||||||||||
550,017 | 1,734,091 | 209 | 42,171 | |||||||||||||
— | 648,666 | 8,265 | 86,381 | |||||||||||||
(3,184,060 | ) | (4,932,708 | ) | (9,784 | ) | (75,840 | ) | |||||||||
(2,634,043 | ) | (2,549,951 | ) | (1,310 | ) | 52,712 | ||||||||||
9,132,604 | 11,766,647 | 1,714,377 | 1,715,687 | |||||||||||||
32,902 | 40,563 | 4,528 | 12,627 | |||||||||||||
643 | 9,206 | 50 | 299 | |||||||||||||
— | 1,980 | 17 | 242 | |||||||||||||
(9,405 | ) | (18,847 | ) | (10 | ) | (8,640 | ) | |||||||||
(8,762 | ) | (7,661 | ) | 57 | (8,099 | ) | ||||||||||
24,140 | 32,902 | 4,585 | 4,528 |
Semi-Annual Report 59
The Lazard Funds, Inc.Financial Highlights (unaudited)
LAZARD GLOBAL DYNAMIC MULTI-ASSET PORTFOLIO
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/27/16* to | |||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | ||||||||||||||
Institutional Shares | ||||||||||||||||||
Net asset value, beginning of period | $ | 9.27 | $ | 11.49 | $ | 10.00 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||
Net investment income (loss) (a) | 0.08 | 0.16 | 0.15 | 0.06 | ||||||||||||||
Net realized and unrealized gain (loss) | 1.03 | (0.92 | ) | 1.92 | (0.01 | ) | ||||||||||||
Total from investment operations | 1.11 | (0.76 | ) | 2.07 | 0.05 | |||||||||||||
Less distributions from: | ||||||||||||||||||
Net investment income | — | (0.20 | ) | (0.14 | ) | (0.05 | ) | |||||||||||
Net realized gains | — | (1.26 | ) | (0.44 | ) | — | (b) | |||||||||||
Total distributions | — | (1.46 | ) | (0.58 | ) | (0.05 | ) | |||||||||||
Net asset value, end of period | $ | 10.38 | $ | 9.27 | $ | 11.49 | $ | 10.00 | ||||||||||
Total Return (c) | 11.97 | % | –6.35 | % | 20.69 | % | 0.53 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||
Net assets, end of period (in thousands) | $ | 49,270 | $ | 42,577 | $ | 68,761 | $ | 48,544 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||
Net expenses | 0.90 | % | 0.90 | % | 0.90 | % | 0.90 | % | ||||||||||
Gross expenses | 1.40 | % | 1.34 | % | 1.42 | % | 2.14 | % | ||||||||||
Net investment income (loss) | 1.62 | % | 1.36 | % | 1.40 | % | 0.95 | % | ||||||||||
Portfolio turnover rate | 51 | % | 120 | % | 102 | % | 67 | % |
The accompanying notes are an integral part of these financial statements.
60 Semi-Annual Report
Selected data for a share of capital stock outstanding | Six Months Ended | Year Ended | For the Period 5/27/16* to | |||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | ||||||||||||||
Open Shares | ||||||||||||||||||
Net asset value, beginning of period | $ | 9.27 | $ | 11.49 | $ | 10.00 | $ | 10.00 | ||||||||||
Income (Loss) from investment operations: | ||||||||||||||||||
Net investment income (loss) (a) | 0.07 | 0.12 | 0.12 | 0.04 | ||||||||||||||
Net realized and unrealized gain (loss) | 1.03 | (0.91 | ) | 1.91 | (0.01 | ) | ||||||||||||
Total from investment operations | 1.10 | (0.79 | ) | 2.03 | 0.03 | |||||||||||||
Less distributions from: | ||||||||||||||||||
Net investment income | — | (0.17 | ) | (0.10 | ) | (0.03 | ) | |||||||||||
Net realized gains | — | (1.26 | ) | (0.44 | ) | — | (b) | |||||||||||
Total distributions | — | (1.43 | ) | (0.54 | ) | (0.03 | ) | |||||||||||
Net asset value, end of period | $ | 10.37 | $ | 9.27 | $ | 11.49 | $ | 10.00 | ||||||||||
Total Return (c) | 11.87 | % | –6.64 | % | 20.33 | % | 0.35 | % | ||||||||||
Ratios and Supplemental Data: | ||||||||||||||||||
Net assets, end of period (in thousands) | $ | 284 | $ | 225 | $ | 414 | $ | 210 | ||||||||||
Ratios to average net assets (d): | ||||||||||||||||||
Net expenses | 1.20 | % | 1.20 | % | 1.20 | % | 1.20 | % | ||||||||||
Gross expenses | 2.70 | % | 4.20 | % | 5.79 | % | 9.43 | % | ||||||||||
Net investment income (loss) | 1.34 | % | 1.07 | % | 1.09 | % | 0.72 | % | ||||||||||
Portfolio turnover rate | 51 | % | 120 | % | 102 | % | 67 | % |
† | Unaudited. |
* | The Portfolio commenced operations on May 27, 2016. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 61
LAZARD OPPORTUNISTIC STRATEGIES PORTFOLIO
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | |||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | |||||||||||||||||||
Institutional Shares | |||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.74 | $ | 10.60 | $ | 9.70 | $ | 9.36 | $ | 10.02 | $ | 10.24 | |||||||||||||
Income (Loss) from investment operations: | |||||||||||||||||||||||||
Net investment income (loss) (a) | 0.04 | 0.14 | 0.10 | 0.16 | ^ | 0.07 | 0.04 | ||||||||||||||||||
Net realized and unrealized gain (loss) | 0.93 | (1.48 | ) | 1.62 | 0.34 | (0.46 | ) | 0.41 | |||||||||||||||||
Total from investment operations | 0.97 | (1.34 | ) | 1.72 | 0.50 | (0.39 | ) | 0.45 | |||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||
Net investment income | — | (0.02 | ) | (0.14 | ) | (0.14 | ) | (0.03 | ) | (0.28 | ) | ||||||||||||||
Net realized gains | — | (0.48 | ) | (0.68 | ) | — | (0.24 | ) | (0.39 | ) | |||||||||||||||
Return of capital | — | (0.02 | ) | — | (0.02 | ) | — | (b) | — | ||||||||||||||||
Total distributions | — | (0.52 | ) | (0.82 | ) | (0.16 | ) | (0.27 | ) | (0.67 | ) | ||||||||||||||
Redemption fees | — | — | — | — | (b) | — | (b) | — | (b) | ||||||||||||||||
Net asset value, end of period | $ | 9.71 | $ | 8.74 | $ | 10.60 | $ | 9.70 | $ | 9.36 | $ | 10.02 | |||||||||||||
Total Return (c) | 11.10 | % | –12.72 | % | 17.74 | % | 5.36 | %^ | –3.80 | % | 4.40 | % | |||||||||||||
Ratios and Supplemental Data: | |||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 88,707 | $ | 102,783 | $ | 151,767 | $ | 141,494 | $ | 170,626 | $ | 185,489 | |||||||||||||
Ratios to average net assets (d): | |||||||||||||||||||||||||
Net expenses | 1.25 | % | 1.02 | % | 1.05 | % | 1.02 | %^ | 1.02 | % | 1.02 | % | |||||||||||||
Gross expenses | 1.41 | % | 1.15 | % | 1.18 | % | 1.19 | % | 1.18 | % | 1.15 | % | |||||||||||||
Gross expenses, excluding expenses on securities sold short | 1.18 | % | 1.15 | %* | 1.15 | % | 1.19 | % | 1.18 | % | 1.15 | % | |||||||||||||
Net investment income (loss) | 0.84 | % | 1.32 | % | 0.99 | % | 1.72 | %^ | 0.66 | % | 0.35 | % | |||||||||||||
Portfolio turnover rate: | |||||||||||||||||||||||||
Excluding securities sold short | 48 | % | 227 | % | 142 | % | 238 | % | 255 | % | 265 | % | |||||||||||||
Including securities sold short | 59 | % | — | %* | 153 | % | — | % | — | % | — | % |
The accompanying notes are an integral part of these financial statements.
62 Semi-Annual Report
Selected data for a share of capital stock outstanding throughout | Six Months Ended | Year Ended | |||||||||||||||||||||||||||
each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | 12/31/15 | 12/31/14 | |||||||||||||||||||||||
Open Shares | |||||||||||||||||||||||||||||
Net asset value, beginning of period | $ | 8.69 | $ | 10.55 | $ | 9.65 | $ | 9.32 | $ | 10.02 | $ | 10.24 | |||||||||||||||||
Income (Loss) from investment operations: | |||||||||||||||||||||||||||||
Net investment income (loss) (a) | 0.02 | 0.10 | 0.05 | 0.13 | ^ | 0.01 | 0.01 | ||||||||||||||||||||||
Net realized and unrealized gain (loss) | 0.94 | (1.46 | ) | 1.64 | 0.33 | (0.47 | ) | 0.41 | |||||||||||||||||||||
Total from investment operations | 0.96 | (1.36 | ) | 1.69 | 0.46 | (0.46 | ) | 0.42 | |||||||||||||||||||||
Less distributions from: | |||||||||||||||||||||||||||||
Net investment income | — | — | (0.11 | ) | (0.11 | ) | — | (b) | (0.25 | ) | |||||||||||||||||||
Net realized gains | — | (0.48 | ) | (0.68 | ) | — | (0.24 | ) | (0.39 | ) | |||||||||||||||||||
Return of capital | — | (0.02 | ) | — | (0.02 | ) | — | (b) | — | ||||||||||||||||||||
Total distributions | — | (0.50 | ) | (0.79 | ) | (0.13 | ) | (0.24 | ) | (0.64 | ) | ||||||||||||||||||
Redemption fees | — | — | — | — | — | — | (b) | ||||||||||||||||||||||
Net asset value, end of period | $ | 9.65 | $ | 8.69 | $ | 10.55 | $ | 9.65 | $ | 9.32 | $ | 10.02 | |||||||||||||||||
Total Return (c) | 11.05 | % | –13.05 | % | 17.48 | % | 4.97 | %^ | –4.51 | % | 4.10 | % | |||||||||||||||||
Ratios and Supplemental Data: | |||||||||||||||||||||||||||||
Net assets, end of period (in thousands) | $ | 233 | $ | 286 | $ | 428 | $ | 823 | $ | 725 | $ | 3,950 | |||||||||||||||||
Ratios to average net assets (d): | |||||||||||||||||||||||||||||
Net expenses | 1.54 | % | 1.32 | % | 1.34 | % | 1.32 | %^ | 1.32 | % | 1.32 | % | |||||||||||||||||
Gross expenses | 2.73 | % | 4.22 | % | 3.87 | % | 3.31 | % | 1.66 | % | 1.81 | % | |||||||||||||||||
Gross expenses, excluding expenses on securities sold short | 2.51 | % | 4.22 | %* | 3.85 | % | 3.31 | % | 1.66 | % | 1.81 | % | |||||||||||||||||
Net investment income (loss) | 0.52 | % | 1.00 | % | 0.53 | % | 1.43 | %^ | 0.15 | % | 0.14 | % | |||||||||||||||||
Portfolio turnover rate: | |||||||||||||||||||||||||||||
Excluding securities sold short | 48 | % | 227 | % | 142 | % | 238 | % | 255 | % | 265 | % | |||||||||||||||||
Including securities sold short | 59 | % | — | %* | 153 | % | — | % | — | % | — | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 63
† | Unaudited. |
^ | Refer to Note 3 in the Notes to Financial Statements for discussion of prior period custodian out-of-pocket expenses that were reimbursed to the Portfolio in the period. The amount of the reimbursement was less than $0.005 per share. There was no impact on the total return of the Portfolio. The net expenses and net investment income (loss) ratios of the Portfolio would be unchanged as the change to period custodian fees was offset against current period expense waivers/reimbursements with no impact to net expenses or net investment income (loss). |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Return for a period of less than one year is not annualized. |
(d) | Annualized for periods less than one year. |
* | No securities sold short during the year. |
The accompanying notes are an integral part of these financial statements.
64 Semi-Annual Report
LAZARD REAL ASSETS AND PRICING OPPORTUNITIES PORTFOLIO^
Selected data for a share | Six Months | For the Period | |||||||||||||||
of capital stock outstanding | Ended | Year Ended | 12/30/16* to | ||||||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | 12/31/16 | |||||||||||||
Institutional Shares | |||||||||||||||||
Net asset value, beginning of period | $ | 9.42 | $ | 10.71 | $ | 10.00 | $ | 10.00 | |||||||||
Income (Loss) from investment operations: | |||||||||||||||||
Net investment income (loss) (a) | 0.10 | 0.16 | 0.19 | — | |||||||||||||
Net realized and unrealized gain (loss) | 0.93 | (0.96 | ) | 0.78 | — | (b) | |||||||||||
Total from investment operations | 1.03 | (0.80 | ) | 0.97 | — | (b) | |||||||||||
Less distributions from: | |||||||||||||||||
Net investment income | (0.05 | ) | (0.25 | ) | (0.13 | ) | — | ||||||||||
Net realized gains | — | (0.24 | ) | (0.13 | ) | — | |||||||||||
Total distributions | (0.05 | ) | (0.49 | ) | (0.26 | ) | — | ||||||||||
Net asset value, end of period | $ | 10.40 | $ | 9.42 | $ | 10.71 | $ | 10.00 | |||||||||
Total Return (c) | 10.94 | % | –7.47 | % | 9.80 | % | 0.00 | % | |||||||||
Ratios and Supplemental Data: | |||||||||||||||||
Net assets, end of period (in thousands) | $ | 17,827 | $ | 16,164 | $ | 17,812 | $ | 13,090 | |||||||||
Ratios to average net assets (d): | |||||||||||||||||
Net expenses | 0.90 | % | 0.90 | % | 0.90 | % | 0.00 | % | |||||||||
Gross expenses | 1.97 | % | 2.04 | % | 3.13 | % | 3.49 | % | |||||||||
Net investment income (loss) | 2.01 | % | 1.53 | % | 1.79 | % | 0.00 | % | |||||||||
Portfolio turnover rate | 19 | % | 72 | % | 76 | % | 0 | % |
The accompanying notes are an integral part of these financial statements.
Semi-Annual Report 65
Selected data for a share | Six Months | Year | For the Period | ||||||||||
of capital stock outstanding | Ended | Ended | 12/30/16* to | ||||||||||
throughout each period | 6/30/19† | 12/31/18 | 12/31/17 | ||||||||||
Open Shares | |||||||||||||
Net asset value, beginning of period | $ | 9.41 | $ | 10.70 | $ | 10.03 | |||||||
Income (Loss) from investment operations: | �� | ||||||||||||
Net investment income (loss) (a) | 0.09 | 0.14 | 0.18 | ||||||||||
Net realized and unrealized gain (loss) | 0.92 | (0.96 | ) | 0.74 | |||||||||
Total from investment operations | 1.01 | (0.82 | ) | 0.92 | |||||||||
Less distributions from: | |||||||||||||
Net investment income | (0.04 | ) | (0.23 | ) | (0.12 | ) | |||||||
Net realized gains | — | (0.24 | ) | (0.13 | ) | ||||||||
Total distributions | (0.04 | ) | (0.47 | ) | (0.25 | ) | |||||||
Net asset value, end of period | $ | 10.38 | $ | 9.41 | $ | 10.70 | |||||||
Total Return (c) | 10.71 | % | –7.70 | % | 9.17 | % | |||||||
Ratios and Supplemental Data: | |||||||||||||
Net assets, end of period (in thousands) | $ | 48 | $ | 43 | $ | 135 | |||||||
Ratios to average net assets (d): | |||||||||||||
Net expenses | 1.15 | % | 1.15 | % | 1.15 | % | |||||||
Gross expenses | 8.20 | % | 13.72 | % | 20.65 | % | |||||||
Net investment income (loss) | 1.77 | % | 1.29 | % | 1.69 | % | |||||||
Portfolio turnover rate | 19 | % | 72 | % | 76 | % |
^ | Consolidated Financial Highlights. |
† | Unaudited. |
* | The inception date for the Institutional Shares was December 30, 2016 and for the Open Shares was January 9, 2017. |
(a) | Net investment income (loss) has been computed using the average shares method. |
(b) | Amount is less than $0.01 per share. |
(c) | Total returns reflect reinvestment of all dividends and distributions, if any. Certain expenses of the Portfolio may have been waived or reimbursed by the Investment Manager, State Street or DST; without such waiver/reimbursement of expenses, the Portfolio’s returns would have been lower. Returns for a period of less than one year are not annualized. |
(d) | Annualized for a period of less than one year except for non-recurring expenses. |
The accompanying notes are an integral part of these financial statements.
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The Lazard Funds, Inc.Notes to Financial Statements
June 30, 2019 (unaudited)
1. Organization
The Lazard Funds, Inc. was incorporated in Maryland on May 17, 1991 and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. As of June 30, 2019, the Fund was comprised of thirty-two no-load portfolios (each referred to as a “Portfolio”). This report includes only the financial statements of Global Dynamic Multi-Asset, Opportunistic Strategies and Real Assets and Pricing Opportunities Portfolios. The financial statements of the other twenty-nine Portfolios are presented separately.
The Portfolios are operated as “diversified” funds, as defined in the 1940 Act.
Each Portfolio currently offers Institutional Shares and Open Shares, and certain Portfolios offer R6 Shares. Each share class is identical except as to minimum investment requirements; eligibility requirements for R6 Shares; the services offered to, and expenses borne by, each class; and the availability of Service Payments (as defined in the Portfolios’ Prospectus).
Lazard Real Assets and Pricing Opportunities Portfolio commenced investment operations and issued Institutional Shares on December 30, 2016. Lazard Real Assets and Pricing Opportunities Portfolio, Ltd. (the “Subsidiary”), organized under the laws of the Cayman Islands, was incorporated on October 7, 2016 and commenced operations on December 30, 2016. The Subsidiary acts as an investment vehicle for the Portfolio in order to effect certain investments on behalf of the Portfolio, consistent with its investment objectives and policies as described in its prospectus. The Portfolio expects that it will achieve a significant portion of its exposure to commodities and commodities-related investments through investment in the Subsidiary. The Portfolio may invest up to 25% of its total assets in the Subsidiary. The financial statements of the Portfolio have been consolidated and include the accounts of both the Portfolio and the Subsidiary. All inter-company balances and transactions have been eliminated in consolidation. As of June 30, 2019, net assets of the Portfolio were $17,874,510, of which $2,895,893, or 16.20%, represented
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the Portfolio’s ownership of all issued shares and voting rights of the Subsidiary.
2. Significant Accounting Policies
The accompanying financial statements are presented in conformity with US Generally Accepted Accounting Principles (“GAAP”). The Fund is an investment company and therefore applies specialized accounting guidance in accordance with Accounting Standards Codification Topic 946. The following is a summary of significant accounting policies consistently followed by the Fund in the preparation of the financial statements:
(a) Valuation of Investments—Equity securities traded on a securities exchange or market, including exchange-traded option contracts, rights and warrants, are valued at the last reported sales price (for domestic equity securities) or the closing price (for foreign equity securities) on the exchange or market on which the security is principally traded or, for securities trading on the NASDAQ National Market System (“NASDAQ”), the NASDAQ Official Closing Price. If there is no available closing price for a foreign equity security, the last reported sales price is used. If there are no reported sales of a security on the valuation date, the security is valued at the most recent quoted bid price on such date reported by such principal exchange or market. Exchange-traded futures contracts are valued at the settlement price on the exchange on which the contract is principally traded. Swap agreements, such as credit default, interest rate and total return swap agreements, generally are valued by an independent pricing service. Forward currency contracts generally are valued using quotations from an independent pricing service. Investments in money market funds are valued at the fund’s net asset value (“NAV”) per share.
Bonds and other fixed-income securities that are not exchange-traded are valued on the basis of prices provided by independent pricing services which are based on, among other things, trading in securities with similar characteristics, brokers’ quotations and/or a matrix system which considers such factors as other security prices, yields and maturities.
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Calculation of a Portfolio’s NAV may not take place contemporaneously with the determination of the prices of portfolio assets used in such calculation. Trading on Europe, Latin and South America and Far East securities exchanges and in over-the-counter markets ordinarily is completed well before the close of business on each business day in New York (i.e., a day on which the New York Stock Exchange (the “NYSE”) is open). In addition, European or Far Eastern securities trading generally, or in a particular country or countries, may not take place on all business days in New York and on which the NAV of a Portfolio is calculated.
The Valuation Committee of the Investment Manager, which meets periodically under the direction of the Board of Directors (the “Board”), may evaluate a variety of factors to determine the fair value of securities for which market quotations are determined not to be readily available or reliable. These factors include, but are not limited to, the type of security, the value of comparable securities, observations from financial institutions and relevant news events. Input from the Investment Manager’s portfolio managers/analysts also will be considered.
If a significant event materially affecting the value of securities occurs between the close of the exchange or market on which the security is principally traded and the time when a Portfolio’s NAV is calculated, or when current market quotations otherwise are determined not to be readily available or reliable (including restricted or other illiquid securities such as certain derivative instruments), such securities will be valued at their fair value as determined by, or in accordance with procedures approved by, the Board. The fair value of non-US securities may be determined with the assistance of an independent pricing service using correlations between the movement of prices of such securities and indices of US securities and other appropriate indicators, such as closing market prices of relevant ADRs or futures contracts. Non-US securities may trade on days when a Portfolio is not open for business, thus affecting the value of the Portfolio’s assets on days when Portfolio shareholders may not be able to buy or sell Portfolio shares.
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The effect of using fair value pricing is that the NAV of a Portfolio will reflect the affected securities’ values as determined in the judgment of the Board or its designee instead of being determined by the market. Using a fair value pricing methodology to price securities may result in a value that is different from the most recent closing price of a security and from the prices used by other investment companies to calculate their portfolios’ NAVs.
(b) Portfolio Securities Transactions and Investment Income—Portfolio securities transactions are accounted for on trade date. Realized gain (loss) on sales of investments are recorded on a specific identification basis. Dividend income is recorded on the ex-dividend date except for certain dividends from non-US securities where the dividend rate is not available. In such cases, the dividend is recorded as soon as the information is received by a Portfolio. Interest income, if any, is accrued daily. A Portfolio amortizes premiums and accretes discounts on fixed-income securities using the effective yield method.
A Portfolio may be subject to taxes imposed by non-US countries in which it invests. Such taxes are generally based upon income earned or capital gains (realized and/or unrealized). An affected Portfolio accrues and applies such taxes to net investment income, net realized gains and net unrealized gains concurrent with the recognition of income earned or capital gains (realized and/or unrealized) from the applicable portfolio securities.
(c) Foreign Currency Translation and Forward Currency Contracts—The accounting records of the Fund are maintained in US dollars. Portfolio securities and other assets and liabilities denominated in a foreign currency are translated daily into US dollars at the prevailing rates of exchange. Purchases and sales of securities, income receipts and expense payments are translated into US dollars at the prevailing exchange rates on the respective transaction dates.
The Portfolios do not isolate the portion of operations resulting from changes in foreign exchange rates on investments from the fluctuations arising from changes in their market prices. Such fluctuations are included in net realized and unrealized gain (loss) on
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investments. Net realized gain (loss) on foreign currency transactions and forward currency contracts represent net foreign currency gain (loss) from forward currency contracts, disposition of foreign currencies, currency gain (loss) realized between the trade and settlement dates on securities transactions, and the difference between the amount of dividends, interest and foreign withholding taxes recorded on the Portfolios’ accounting records and the US dollar equivalent amounts actually received or paid. Net change in unrealized appreciation (depreciation) on foreign currency translations reflects the impact of changes in exchange rates on the value of assets and liabilities, other than investments in securities, during the period.
A forward currency contract is an agreement between two parties to buy or sell currency at a set price on a future date. Upon entering into these contracts, risks may arise from the potential inability of counterparties to meet the terms of their contracts and from unanticipated movements in the value of the foreign currency relative to the US dollar.
The US dollar value of forward currency contracts is determined using quotations provided by an independent pricing service. Daily fluctuations in the value of such contracts are recorded as unrealized appreciation (depreciation) on forward currency contracts. When the contract is closed, a Portfolio records a realized gain (loss) equal to the difference between the value at the time it was opened and the value at the time it was closed.
During the period ended June 30, 2019, the Global Dynamic Multi-Asset and Real Assets and Pricing Opportunities Portfolios traded in forward currency contracts.
(d) Futures Contracts—For hedging and investment purposes, certain Portfolios may enter into futures contracts in US domestic markets, or exchanges located outside the United States.
Foreign markets may offer advantages such as trading opportunities or arbitrage possibilities not available in the United States. Foreign markets, however, may have greater risk potential than domestic markets. For example, some foreign exchanges are prin-
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cipal markets so that no common clearing facility exists and an investor may look only to the broker for performance of the contract. In addition, any profits a Portfolio might realize in trading could be eliminated by adverse changes in the currency exchange rate, or the Portfolio could incur losses as a result of those changes. Transactions on foreign exchanges may include both commodities which are traded on domestic exchanges and those which are not. Unlike trading on domestic commodity exchanges, trading on foreign commodity exchanges is not regulated by the Commodity Futures Trading Commission.
Engaging in these transactions involves risk of loss to the Portfolio which could adversely affect the value of the Portfolio’s net assets. Although each of these Portfolios intends to purchase or sell futures contracts only if there is an active market for such contracts, no assurance can be given that a liquid market will exist for any particular contract at any particular time. Many futures exchanges and boards of trade limit the amount of fluctuation permitted in futures contract prices during a single trading day. Once the daily limit has been reached in a particular contract, no trades may be made that day at a price beyond that limit or trading may be suspended for specified periods during the trading day. Futures contract prices could move to the limit for several consecutive trading days with little or no trading, thereby preventing prompt liquidation of futures positions and potentially subjecting the Portfolio to substantial losses.
During the period ended June 30, 2019, the Real Assets and Pricing Opportunities Portfolio traded in futures contracts.
(e) Swap Agreements—Swap agreements on equity securities involve commitments to pay interest in exchange for a market linked return based on a notional amount. The counterparty pays out the total return of the equity security or basket of equity securities and, in return, receives a regular stream of payments, based on an agreed-upon interest rate. To the extent the total return of the security or basket of securities underlying the transaction exceeds (or falls short of) the offsetting interest rate obligation, a
72 Semi-Annual Report
Portfolio will receive a payment from (or make a payment to) the counterparty.
Commodity-linked swap agreements involve commitments to pay interest in exchange for a commodity-linked return based on a notional amount. To the extent the return of the reference commodity or commodity index or basket of reference commodities or commodity indexes underlying the transaction exceeds (or falls short of) the offsetting interest rate obligation, a Portfolio will receive a payment from (or make a payment to) the counterparty.
Swap agreements generally are valued by an independent pricing service, and the change in value, if any, is recorded as unrealized appreciation (depreciation) on swap agreements in a Portfolio’s accompanying Statement of Assets and Liabilities. Once the interim payments are settled in cash, the net amount is recorded as realized gain (loss) on swap agreements in a Portfolio’s accompanying Statement of Operations, in addition to any realized gain (loss) recorded upon the termination of swap agreements.
During the period ended June 30, 2019, the Real Assets and Pricing Opportunities Portfolios traded in swap agreements.
(f) Short Sales—A short sale is a transaction in which a Portfolio sells securities it does not own but has borrowed in anticipation of a decline in the market price of the securities. The initial amount of a short sale is recorded as a liability which is marked-to-market daily. Fluctuations in the value of the short liability are recorded as unrealized gains or losses. A Portfolio realizes a gain or loss upon closing of the short sale (returning the security to the counterparty by way of purchase or delivery of a long position owned). Short sales by a Portfolio involve certain risks and special considerations. Possible losses from short sales differ from losses that could be incurred from a purchase of a security because losses from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested. The Portfolio may have to pay a fee to borrow the particular security and is liable to the buyer for any dividends or interest payable on securities while those securities are in a short position. These dividends and interest amounts are an expense of the Portfolio. The Portfolio desig-
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nates collateral consisting of cash, US government securities or other liquid assets sufficient to collateralize the market value of short positions.
Proceeds from short sales are generally retained in cash accounts or invested in securities that are cash equivalents. With regard to securities borrowed as of June 30, 2019, pursuant to short sale arrangements, the Portfolios have a right to set off any assets held (including the borrowed securities) or obligations owed to the lender (State Street), in the event of the lender’s default, against any obligations owed by the lender to the Portfolios under any agreement or collateral document, including the collateral value of the Securities Loan Collateral, as that term is defined in the Securities Lending and Services Agreement between the Portfolios and State Street. At June 30, 2019, the Opportunistic Strategies Portfolio had pledged $11,651,031 of long securities as collateral under such arrangements.
For the period ended June 30, 2019, proceeds from securities sold short and purchases to cover short positions for the Opportunistic Strategies Portfolio were $22,398,722 and $13,620,788, respectively.
(g) Federal Income Taxes—The Fund’s policy is to have each Portfolio qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and to distribute all of its taxable income, including any net realized capital gains, to shareholders. Therefore, no federal income tax provision is required.
At December 31, 2018, the Portfolios had no unused realized capital loss carryovers which, for federal income tax purposes, could be used to offset future realized capital gains.
Under current tax law, post-October capital losses or certain late-year ordinary losses, as defined by the Code, within the taxable year may be deferred and treated as occurring on the first day of the following tax year. For the tax year ended December 31, 2018, the following Portfolios elected to defer such losses as follows:
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Post-October | Late-Year | ||||
Capital Loss | Ordinary Loss | ||||
Portfolio | Deferral | Deferral | |||
Opportunistic Strategies | $2,780,060 | $50 | |||
Real Assets and Pricing Opportunities | 43,215 | — |
For federal income tax purposes, the aggregate cost, aggregate gross unrealized appreciation, aggregate gross unrealized depreciation and the net unrealized appreciation (depreciation) were as follows:
Aggregate | Aggregate | Net | |||||||
Gross | Gross | Unrealized | |||||||
Aggregate | Unrealized | Unrealized | Appreciation | ||||||
Portfolio | Cost | Appreciation | Depreciation | (Depreciation) | |||||
Global Dynamic Multi-Asset | $46,466,971 | $4,158,294 | $1,120,567 | $3,037,727 | |||||
Opportunistic Strategies | 90,895,806 | 4,857,171 | 184,688 | 4,672,483 | |||||
Real Assets and Pricing Opportunities | 16,673,858 | 1,396,552 | 542,925 | 853,627 |
Management has analyzed the Portfolios’ tax positions, and has concluded that no liability for unrecognized tax benefits should be recorded related to uncertain tax positions taken on tax returns filed for any open tax years (or expected to be taken on future tax returns). Open tax years are those that remain subject to examination and are based on each tax jurisdiction’s statute of limitations. Each Portfolio files a US federal income tax return annually after its fiscal year-end, which is subject to examination by the Internal Revenue Service for a period of three years from the date of filing.
(h) Dividends and Distributions—Dividends from net investment income, if any, will be declared and paid annually, except that the Real Assets and Pricing Opportunities Portfolio’s dividends from net investment income (if any), will be declared and paid quarterly. During any particular year, net realized gains from investment transactions in excess of available capital loss carryforwards would be taxable to the Portfolios, if not distributed. The Portfolios intend to declare and distribute these amounts, at least annually, to shareholders; however, to avoid taxation, a second distribution
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may be required. Differences in per share distributions, by class, are generally due to differences in class specific expenses.
Net income and realized gains from investments held by the Subsidiary are treated as ordinary income for tax purposes. If a net loss is realized by the Subsidiary in any taxable year, the loss will generally not be available to offset the Real Assets and Pricing Opportunities Portfolio’s ordinary income and/or capital gains for that year, or any future tax year.
Income and capital gains distributions are determined in accordance with federal income tax regulations which may differ from GAAP. These book/tax differences, which may result in distribution reclassifications, are primarily due to differing treatments of foreign currency transactions, wash sales, passive foreign investment companies, certain fixed-income securities, expenses derivatives and distributions from real estate investment trusts. The book/tax differences relating to shareholder distributions may result in reclassifications among certain capital accounts.
(i) Allocation of Expenses—Expenses common to the Fund, Lazard Retirement Series, Inc., Lazard Global Total Return and Income Fund, Inc. and Lazard World Dividend & Income Fund, Inc. (each a “Lazard Fund” and collectively, the “Lazard Fund Complex”), each a registered management investment company advised by the Investment Manager, not directly chargeable to one or more specific Lazard Funds are allocated to the Fund and among its Portfolios primarily on the basis of relative net assets. Expenses of the Fund not directly chargeable to one or more Portfolios are similarly allocated among the Portfolios on the basis of relative net assets. Portfolios accrue distribution and service (12b-1) fees to Open Shares. The Portfolios’ income, expenses (other than class specific expenses) and realized and unrealized gains and losses are allocated proportionally each day between the classes based upon the relative net assets of each class.
(j) Redemption Fee—Until August 15, 2016, the Portfolios imposed a 1.00% redemption fee (short-term trading fee) on Portfolio shares redeemed less than 30 days after such shares were acquired. The fees were retained by the Portfolios and are included
76 Semi-Annual Report
as paid in capital on the Statements of Assets and Liabilities. As of August 15, 2016, redemption fees no longer apply to transactions in Portfolio shares.
(k) Estimates—The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets resulting from operations during the reporting period. Actual results could differ from those estimates.
(l) Net Asset Value—NAV per share for each class of each Portfolio is determined each day the NYSE is open for trading as of the close of regular trading on the NYSE (generally 4:00 p.m. Eastern time). The Fund will not treat an intraday unscheduled disruption in NYSE trading as a closure of the NYSE, and will price its shares as of 4:00 p.m., if the particular disruption directly affects only the NYSE. NAV per share is determined by dividing the value of the total assets of the Portfolio represented by such class, less all liabilities, by the total number of Portfolio shares of such class outstanding.
3. Investment Management, Administration, Custody, Distribution and Transfer Agency Agreements
The Fund, on behalf of the Portfolios, has entered into a management agreement (the “Management Agreement”) with the Investment Manager. Pursuant to the Management Agreement, the Investment Manager regularly provides each Portfolio with investment research, advice and supervision and furnishes continuously an investment program for each Portfolio consistent with its investment objectives and policies, including the purchase, retention and disposition of securities, and provides the Portfolios with administrative, operational and compliance assistance services. For its services provided to the Portfolios, the Investment Manager earns a management fee, accrued daily as a percentage of each Portfolio’s average daily net assets and payable by each Portfolio monthly, at the annual rate set forth below:
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Portfolio | Annual Rate | |||
Global Dynamic Multi-Asset | 0.80 | % | ||
Opportunistic Strategies | 1.00 | |||
Real Assets and Pricing Opportunities | 0.70 |
The Investment Manager provides investment management and other services to the Subsidiary. The Investment Manager does not receive separate compensation from the Subsidiary for providing such services. However, the Real Assets and Pricing Opportunities Portfolio pays the Investment Manager based on its net assets, which include the assets of the Subsidiary.
The Investment Manager has voluntarily agreed to waive its fees and, if necessary, reimburse the Portfolios until May 1, 2020 if the aggregate direct expenses of the Portfolios, exclusive of taxes, brokerage, interest on borrowings, fees and expenses of “Acquired Funds” (as defined in Form N-1A) and extraordinary expenses including, for the purposes of the expense limitation agreement only, fees related to filing foreign tax reclaims, exceed the percentages of the value of the Portfolio’s average daily net assets set forth opposite the Portfolio’s name on table below. The Fund, on behalf of the Portfolio, may deduct from the payment to be made to the Investment Manager under the Management Agreement, or the Investment Manager will bear, such excess expense.
Portfolio | Institutional Shares | Open Shares | ||||||
Global Dynamic Multi-Asset | 0.90 | % | 1.20 | % | ||||
Opportunistic Strategies | 1.02 | 1.32 | ||||||
Real Assets and Pricing Opportunities | 0.90 | 1.15 |
During the period ended June 30, 2019, the Investment Manager waived its management fees and reimbursed the following Portfolios for other expenses as follows:
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Institutional Shares | Open Shares | |||||||||||||||||||
Management | Expenses | Management | Expenses | |||||||||||||||||
Portfolio | Fees Waived | Reimbursed | Fees Waived | Reimbursed | ||||||||||||||||
Global Dynamic Multi-Asset | $ | 114,427 | $ | — | $ | 1,055 | $ | 926 | ||||||||||||
Opportunistic Strategies | 78,951 | — | 1,307 | 252 | ||||||||||||||||
Real Assets and Pricing Opportunities | 60,285 | 32,218 | 160 | 1,448 |
The aforementioned waivers and/or reimbursements are not subject to recoupment by the Investment Manager.
State Street provides the Fund with custody and certain fund administration and accounting services.
In December 2015, State Street announced that it had identified inconsistencies in the way in which clients were invoiced for custody out-of-pocket expenses from 1998 until 2015. The difference between what was charged and what should have been charged, plus interest, was recorded as a reimbursement when determined in 2016. Pursuant to the expense limitations described above, certain Portfolios experienced management fee waivers during the year ended December 31, 2016. Accordingly, the reimbursement of out-of-pocket expenses resulted in the reduction in the waiver of management fees for certain Portfolios for the year ended December 31, 2016.
The Fund has a distribution agreement with Lazard Asset Management Securities LLC (the “Distributor”), a wholly-owned subsidiary of the Investment Manager, to serve as the distributor for shares of each Portfolio. The Distributor bears the cost of printing and mailing prospectuses to potential investors and certain expenses in connection with the offering of Portfolio shares.
Under a distribution and servicing plan adopted pursuant to Rule 12b-1 under the 1940 Act, each Portfolio pays a monthly fee to the Distributor, at an annual rate of 0.25% of the average daily net assets of its Open Shares, for distribution and servicing of accounts. The Distributor may make payments to certain financial institutions, securities dealers and other industry professionals for providing these services.
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DST is the Fund’s transfer and dividend disbursing agent.
4. Directors’ Compensation
Certain Directors of the Fund are officers of the Investment Manager. For the period ended June 30, 2019, each Director who is not an affiliated person of the Investment Manager or any of its affiliates was paid by all of the funds in the Lazard Fund Complex: (1) an annual retainer of $232,000, (2) an additional annual fee of $33,000 to the lead Independent Director (an “Independent Director” is a Director who is not an “interested person” (as defined in the 1940 Act) of the Fund), and (3) an additional annual fee of $23,000 to the Audit Committee Chair. The Independent Directors may be paid additional compensation for participation on ad hoc committees or other work performed on behalf of the Board. The Independent Directors also are reimbursed for travel and other out- of- pocket expenses for attending Board and committee meetings. The Directors do not receive benefits from the Fund pursuant to any pension, retirement or similar arrangement. Independent Directors’ fees are allocated among the funds in the Lazard Fund Complex at a rate of $5,000 per fund with the remainder allocated based upon each fund’s proportionate share of combined net assets. The Statements of Operations show the Independent Directors’ fees and expenses paid by each Portfolio.
5. Securities Transactions and Transactions with Affiliates
Purchases and sales of portfolio securities (excluding short-term investments) for the period ended June 30, 2019 were as follows:
Portfolio | Purchases | Sales | ||||||
Global Dynamic Multi-Asset | $ | 24,068,779 | $ | 20,954,675 | ||||
Opportunistic Strategies | 55,902,004 | 79,167,016 | ||||||
Real Assets and Pricing Opportunities | 2,394,779 | 2,978,152 | ||||||
US Treasury Securities | ||||||||
Portfolio | Purchases | Sales | ||||||
Real Assets and Pricing Opportunities | $267,393 | $ | — |
For the period ended June 30, 2019, the Portfolios did not engage in any cross-trades in accordance with Rule 17a-7 under the 1940 Act, and no brokerage commissions were paid to affiliates of the
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Investment Manager or other affiliates of the Fund for portfolio transactions executed on behalf of the Fund.
At June 30, 2019, the Investment Manager owned 12.84% of the outstanding shares of the Global Dynamic Multi-Asset Portfolio.
6. Line of Credit
The Fund has a $50 million Line of Credit Agreement (the “Agreement”) with State Street, primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. Interest on borrowings is payable at the higher of the Federal Funds rate or One-Month LIBOR rate plus 1.00%, on an annualized basis. Under the Agreement, the Fund has agreed to pay a 0.20% per annum fee on the unused portion of the commitment, payable quarterly in arrears. The Fund has also agreed to pay an upfront fee of 0.05% of the committed line amount. During the period ended June 30, 2019, the Portfolios did not borrow under the Agreement.
Management believes that the fair value of the liability under the line of credit is equivalent to the recorded amount based on its short-term maturity and interest rate, which fluctuates with LIBOR. A Portfolio’s outstanding balance on the line of credit, if any, would be categorized as Level 2.
7. Investment Risks
(a) Non-US Securities Risk—A Portfolio’s performance will be influenced by political, social and economic factors affecting the non-US countries and companies in which the Portfolio invests. Non-US securities carry special risks, such as less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less liquidity.
(b) Emerging Market Risk—Emerging market countries generally have economic structures that are less diverse and mature, and political systems that are less stable, than those of developed countries. The economies of countries with emerging markets may be based predominantly on only a few industries, may be highly
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vulnerable to changes in local or global trade conditions, and may suffer from extreme debt burdens or volatile inflation rates. The securities markets of emerging market countries have historically been extremely volatile. These market conditions may continue or worsen. Investments in these countries may be subject to political, economic, legal, market and currency risks. The risks may include less protection of property rights and uncertain political and economic policies, the imposition of capital controls and/or foreign investment limitations by a country, nationalization of businesses and the imposition of sanctions by other countries, such as the US. Significant devaluation of emerging market currencies against the US dollar may occur subsequent to acquisition of investments denominated in emerging market currencies.
(c) Foreign Currency Risk—Investments denominated in currencies other than US dollars may experience a decline in value, in US dollar terms, due solely to fluctuations in currency exchange rates. A Portfolio’s currency investments could be adversely affected by delays in, or a refusal to grant, repatriation of funds or conversion of emerging market currencies. The Investment Manager generally does not intend to actively hedge the Portfolio’s foreign currency exposure.
(d) Realty Companies, Real Estate Investments and REITs Risk—Portfolios that invest in Realty Companies (as defined in the Fund’s prospectus), Real Estate Investments and/or Real Estate Investment Trusts (REITs) could lose money due to the performance of real estate-related securities even if securities markets generally are experiencing positive results. The performance of investments made by a Portfolio may be determined to a great extent by the current status of the real estate industry in general, or by other factors (such as interest rates and the availability of loan capital) that may affect the real estate industry, even if other industries would not be so affected. Consequently, the investment strategies of a Portfolio could lead to securities investment results that may be significantly different from investments in securities of other industries or sectors or in a more broad-based portfolio generally.
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The risks related to investments in Realty Companies and Real Estate Investments include, but are not limited to: adverse changes in general economic and local market conditions; adverse developments in employment; changes in supply or demand for similar or competing properties; unfavorable changes in applicable taxes, governmental regulations and interest rates; operating or development expenses; and lack of available financing.
REITs are subject to similar risks as Real Estate Investments and Realty Companies. The risks related to investments in Real Estate Investments and Realty Companies include, but are not limited to: adverse changes in general economic and local market conditions; adverse developments in employment; changes in supply or demand for similar or competing properties; unfavorable changes in applicable taxes, governmental regulations and interest rates; operating or development expenses; and lack of available financing. Due to certain special considerations that apply to REITs, investments in REITs may carry additional risks not necessarily present in investments in other securities. REIT securities (including those trading on national exchanges) typically have trading volumes that are less than those of common stocks of other stocks traded on national exchanges, which may affect a Portfolio’s ability to trade or liquidate those securities. An investment in REITs may be adversely affected if the REIT fails to comply with applicable laws and regulations. Failure to qualify with any of these requirements could jeopardize a company’s status as a REIT. A Portfolio generally will have no control over the operations and policies of a REIT, and they generally will have no ability to cause a REIT to take the actions necessary to qualify as a REIT.
(e) Subsidiary Risk—The Real Assets and Pricing Opportunities Portfolio invests in the Subsidiary, which is not registered as an investment company under the 1940 Act. A regulatory change in the US or the Cayman Islands, under which the Portfolio and the Subsidiary, respectively, are organized, that impacts the Subsidiary or how the Portfolio invests in the Subsidiary, such as a change in tax law, could adversely affect the Portfolio. By investing in the Subsidiary, the Portfolio is exposed to the risks associated
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with the Subsidiary’s investments, which generally include the risks of investing in commodity-related derivative instruments.
(f) Tax Status Risk—Income and gains from commodities or certain commodity-linked derivative instruments do not constitute “qualifying income” to the Real Assets and Pricing Opportunities Portfolio for purposes of qualification as a “regulated investment company” for federal income tax purposes. Without such qualification, the Portfolio could be subject to tax. The tax treatment of some of the Portfolio’s investments in the Subsidiary and commodity-linked derivatives may be adversely affected by future legislation, regulations of the US Treasury Department or guidance issued by the Internal Revenue Service, or otherwise affect the character, timing and/or amount of the Portfolio’s taxable income or any gains and distributions made by the Portfolio.
(g) Fixed-Income and Debt Securities Risk—The market value of a debt security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The debt securities market can be susceptible to increases in volatility and decreases in liquidity. Liquidity can decline unpredictably in response to overall economic conditions or credit tightening.
Prices of bonds and other debt securities tend to move inversely with changes in interest rates. Typically, a rise in rates will adversely affect debt securities and, accordingly, will cause the value of a Portfolio’s investments in these securities to decline. Interest rate risk is usually greater for fixed-income securities with longer maturities or durations. A rise in interest rates (or the expectation of a rise in interest rates) may result in periods of volatility, decreased liquidity and increased redemptions, and, as a result, the Portfolio may have to liquidate portfolio securities at disadvantageous prices. During periods of reduced market liquidity, a Portfolio may not be able to readily sell debt securities at prices at or near their perceived value. An unexpected increase in Portfolio redemption requests, including requests from shareholders who may own a significant percentage of a Portfolio’s shares,
84 Semi-Annual Report
which may be triggered by market turmoil or an increase in interest rates, could cause the Portfolio to sell its holdings at a loss or at undesirable prices and adversely affect the Portfolio’s share price and increase the Portfolio’s liquidity risk, Portfolio expenses and/or taxable distributions. Economic and other developments can adversely affect debt securities markets.
A Portfolio’s investments in lower-rated, higher-yielding securities (“junk bonds”) are subject to greater credit risk than its higher-rated investments. Credit risk is the risk that the issuer will not make interest or principal payments, or will not make payments on a timely basis. Non-investment grade securities tend to be more volatile, less liquid and are considered speculative. If there is a decline, or perceived decline, in the credit quality of a debt security (or any guarantor of payment on such security), the security’s value could fall, potentially lowering a Portfolio’s share price. The prices of non-investment grade securities, unlike investment grade debt securities, may fluctuate unpredictably and not necessarily inversely with changes in interest rates. The prices of high yield securities can fall in response to negative news about the issuer or its industry, or the economy in general to a greater extent than those of higher-rated securities. The market for these securities may be less liquid and therefore these securities may be harder to value or sell at an acceptable price, especially during times of market volatility or decline.
Some fixed-income securities may give the issuer the option to call, or redeem, the securities before their maturity. If securities held by a Portfolio are called during a time of declining interest rates (which is typically the case when issuers exercise options to call outstanding securities), the Portfolio may have to reinvest the proceeds in an investment offering a lower yield (and the Portfolio may not fully benefit from any increase in the value of its portfolio holdings as a result of declining interest rates).
Adjustable rate securities provide a Portfolio with a certain degree of protection against rises in interest rates, although such securities will participate in any declines in interest rates as well. Certain adjustable rate securities, such as those with interest rates that
Semi-Annual Report 85
fluctuate directly or indirectly based on multiples of a stated index, are designed to be highly sensitive to changes in interest rates and can subject the holders thereof to extreme reductions of yield and possibly loss of principal. Certain fixed-income securities may be issued at a discount from their face value (such as zero coupon securities) or purchased at a price less than their stated face amount or at a price less than their issue price plus the portion of “original issue discount” previously accrued thereon,i.e., purchased at a “market discount.“The amount of original issue discount and/or market discount on certain obligations may be significant, and accretion of market discount together with original issue discount will cause a Portfolio to realize income prior to the receipt of cash payments with respect to these securities.
(h) Underlying Funds Risk—Shares of exchange-traded funds (“ETFs”), closed-end funds and exchange-traded notes (“ETNs” and collectively with ETFs and closed-end funds, “Underlying Funds”) in which certain Portfolios invest may trade at prices that vary from their NAVs, sometimes significantly. The shares of ETFs and closed-end funds may trade at prices at, below or above their most recent NAV. Shares of closed-end funds, in particular, frequently trade at persistent discounts to their NAV. In addition, the performance of an ETF pursuing a passive index-based strategy may diverge from the performance of the index. ETNs may not trade in the secondary market, but typically are redeemable by the issuer. A Portfolio’s investments in Underlying Funds are subject to the risks of Underlying Funds’ investments, as well as to the general risks of investing in Underlying Funds. Portfolio shares will bear not only the Portfolio’s management fees and operating expenses, but also their proportional share of the management fees and operating expenses of the ETFs and closed-end funds in which the Portfolio invests. While ETNs do not have management fees, they are subject to certain investor fees. ETNs are debt securities that, like ETFs, typically are listed on exchanges and their terms generally provide for a return that tracks specified market indexes. However, unlike ETFs and closed-end funds, ETNs are not registered investment companies and thus are not registered under the 1940 Act. In addition, as debt securities, ETNs are sub-
86 Semi-Annual Report
ject to the additional risk of the creditworthiness of the issuer. ETNs typically do not make periodic interest payments.
These Portfolios may be limited by the 1940 Act in the amount their assets that may be invested in ETFs and closed-end funds unless an ETF or a closed-end fund has received an exemptive order from the US Securities and Exchange Commission (the “SEC”) on which the Portfolios may rely or an exemption is available.
Many ETFs have received an exemptive order from the SEC providing an exemption from the 1940 Act limits on the amount of assets that may be invested in ETFs and closed-end funds, and a Portfolio’s reliance on an order is conditioned on compliance with certain conditions of the order. If an exemptive order has not been received and an exemption is not available under the 1940 Act, the Portfolio will be limited in the amount it can invest in Underlying Funds that are registered investment companies to: (1) 3% or less of an Underlying Fund’s voting shares, (2) an Underlying Fund’s shares in value equal to or less than 5% of the Portfolio’s assets and (3) shares of Underlying Funds in the aggregate in value equal to or less than 10% of the Portfolio’s total assets.
(i) Short Position Risk—Short sales or positions may involve substantial risks. If a short position appreciates in value during a period of the Portfolio’s investment, there will be a loss to the Portfolio that could be substantial. Short positions involve more risk than long positions because the maximum sustainable loss on a security purchased is limited to the amount paid for the security plus the transaction costs. However, a Portfolio’s potential loss on a short position is unlimited because, theoretically, there is no limit to the potential price increase of a security.
Short sales of securities also may involve additional transaction-related costs such as those in connection with borrowing the securities sold short.
There is a risk that certain Portfolios may be unable to fully implement their investment strategies due to a lack of available securities to borrow to effect short sales or for some other reason.
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When seeking to effect short sales of securities, a Portfolio may not always be able to borrow a security the Portfolio seeks to sell short at a particular time or at an acceptable price. In addition, a Portfolio may not always be able to close out a short sale position at a particular time or at an acceptable price. If the lender of a borrowed security requires a Portfolio to return the security to it on short notice, and the Portfolio is unable to borrow the security from another lender, the Portfolio may have to buy the borrowed security at an unfavorable price, resulting in a loss. In addition, there is a risk that the collateral pledged to the Portfolio’s custodian to secure securities borrowings in connection with short sales of securities may not be returned to the Portfolio or may not be returned in a timely manner.
It is possible that the market value of the securities a Portfolio holds in long positions will decline at the same time that the market value of the securities to which the Portfolio has short exposure increases, thereby increasing the Portfolio’s potential volatility.
(j) Natural Resources Risk—Investments related to natural resources may be affected by numerous factors, including events occurring in nature, inflationary pressures and domestic and international politics. For example, events occurring in nature (such as earthquakes or fires in prime natural resource areas) and political events (such as coups or military confrontations) can affect the overall supply of a natural resource and the value of companies involved in such natural resource. Political risks and other risks to which non-US companies are subject also may affect US companies if they have significant operations or investments in non-US countries. In addition, interest rates, prices of raw materials and other commodities, international economic developments, energy conservation, tax and other government regulations (both US and non-US) may affect the supply of and demand for natural resources, which can affect the profitability and value of securities issued by companies in the natural resources category. Securities of companies within specific natural resources sub-categories can perform differently than the overall market. This may be due to
88 Semi-Annual Report
changes in such things as the regulatory or competitive environment or to changes in investor perceptions.
(k) Commodities-Related Investments Risk—Exposure to the commodities markets may subject the Real Assets and Pricing Opportunities Portfolio and the Subsidiary to greater volatility than other types of investments. The values of commodities and commodity-linked derivative instruments are affected by events that may have less impact on the values of equity and fixed income securities. Investments linked to the prices of commodities are considered speculative. Because the value of a commodity-linked derivative instrument, such as a futures contract on a physical commodity, typically is based upon the price movements of the underlying reference asset, index or rate, the value of these instruments will rise or fall in response to changes in the underlying reference asset, index or rate. Prices of commodities and commodity-linked investments may fluctuate significantly over short periods for a variety of factors, including: changes in supply and demand relationships; weather; agricultural or livestock markets; agricultural or livestock disease or pestilence; trade relationships; fiscal, monetary and exchange control programs; and embargoes, tariffs, terrorism and international economic, political, military and regulatory developments. The commodity markets are subject to temporary distortions or other disruptions due to a variety of factors, including the lack of liquidity in the markets, the participation of speculators and government regulation and intervention. United States futures exchanges and some foreign exchanges have regulations that limit the amount of fluctuation in futures contract prices, which may occur during a single business day. These limits are generally referred to as “daily price fluctuation limits” and the maximum or minimum price of a contract on any given day as a result of these limits is referred to as a “limit price.” Once the limit price has been reached in a particular contract, no trades may be made at a different price. Limit prices have the effect of precluding trading in a particular contract or forcing the liquidation of contracts at disadvantageous times or prices. These circumstances could adversely affect the value of the commodity-linked investments.
Semi-Annual Report 89
(l) Inflation-Indexed Security Risk—Interest payments on inflation-indexed securities can be unpredictable and will vary as the principal and/or interest is periodically adjusted based on the rate of inflation. If the index measuring inflation falls, the interest payable on these securities will be reduced. The US Treasury has guaranteed that, in the event of a drop in prices, it would repay the par amount of its inflation-indexed securities. Inflation-indexed securities issued by corporations generally do not guarantee repayment of principal. Any increase in the principal amount of an inflation-indexed security will be considered taxable ordinary income, even though investors do not receive their principal until maturity. As a result, a Portfolio may be required to make annual distributions to shareholders that exceed the cash the Portfolio received, which may cause the Portfolio to liquidate certain investments when it is not advantageous to do so. Also, if the principal value of an inflation-indexed security is adjusted downward due to deflation, amounts previously distributed may be characterized in some circumstances as a return of capital.
(m) Derivatives and Hedging Risk—Derivatives transactions, including those entered into for hedging purposes (i.e., seeking to protect Portfolio investments), may increase volatility, reduce returns, limit gains or magnify losses, perhaps substantially, particularly since most derivatives have a leverage component that provides investment exposure in excess of the amount invested. Over-the-counter swap agreements, forward currency contracts, writing or purchasing over-the-counter options on securities (including options on ETFs and ETNs), indexes and currencies and other over-the-counter derivatives transactions are subject to the risk of default by the counterparty and can be illiquid. Changes in liquidity may result in significant, rapid and unpredictable changes in the prices for derivatives. These derivatives transactions, as well as the exchange-traded futures and options in which certain Portfolios may invest, are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related index, commodity, interest rate, currency, security or other reference asset. As such, a small investment could have a potentially large impact on a Portfolio’s performance. Purchasing options will reduce returns by the amount of premiums paid for options that are not
90 Semi-Annual Report
exercised. In fact, many derivatives may be subject to greater risks than those associated with investing directly in the underlying or other reference asset. Derivatives transactions incur costs, either explicitly or implicitly, which reduce returns, and costs of engaging in such transactions may outweigh any gains or any losses averted from hedging activities. Successful use of derivatives, whether for hedging or for other investment purposes, is subject to the Investment Manager’s ability to predict correctly movements in the direction of the relevant reference asset or market and, for hedging activities, correlation of the derivative instruments used with the investments seeking to be hedged. Use of derivatives transactions, even when entered into for hedging purposes, may cause a Portfolio to experience losses greater than if the Portfolio had not engaged in such transactions.
8. Contractual Obligations
The Fund enters into contracts in the normal course of business that contain a variety of indemnification provisions. A Portfolio’s maximum exposure under these arrangements is unknown. Management has reviewed the Fund’s existing contracts and expects the risk of loss to be remote.
9. Fair Value Measurements
Fair value is defined as the price that a Portfolio would receive to sell an asset, or would pay to transfer a liability, in an orderly transaction between market participants at the date of measurement. The Fair Value Measurements and Disclosures provisions of GAAP also establish a framework for measuring fair value, and a three-level hierarchy for fair value measurement that is based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer, broadly, to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions about the assumptions that market participants would use in pricing the asset or liability, developed based on the best information available in the circumstances. The fair value measurement level
Semi-Annual Report 91
within the fair value hierarchy for the assets and liabilities of the Fund is based on the lowest level of any input that is significant to the overall fair value measurement. The three-level hierarchy of inputs is summarized below:
· | Level 1 – unadjusted quoted prices in active markets for identical assets and liabilities |
· | Level 2 – other significant observable inputs (including unadjusted quoted prices for similar assets and liabilities, interest rates, prepayment speeds, credit risk, etc.) |
· | Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of assets and liabilities) |
Changes in valuation technique may result in transfers into or out of the current assigned level within the hierarchy.
The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in these securities.
92 Semi-Annual Report
The following table summarizes the valuation of the Portfolios’ assets and liabilities by each fair value hierarchy level as of June 30, 2019:
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||||
Global Dynamic Multi-Asset Portfolio | |||||||||||||||||||
Assets: | |||||||||||||||||||
Common Stocks* | |||||||||||||||||||
Australia | $ | — | $ | 1,114,644 | $ | — | $ | 1,114,644 | |||||||||||
Belgium | 185,871 | 217,215 | — | 403,086 | |||||||||||||||
Canada | 1,624,214 | — | — | 1,624,214 | |||||||||||||||
China | — | 32,767 | — | 32,767 | |||||||||||||||
Denmark | — | 222,623 | — | 222,623 | |||||||||||||||
Finland | 210,500 | — | — | 210,500 | |||||||||||||||
France | 131,171 | 655,131 | — | 786,302 | |||||||||||||||
Germany | 137,142 | 347,828 | — | 484,970 | |||||||||||||||
Hong Kong | 399,409 | 166,548 | — | 565,957 | |||||||||||||||
Israel | 130,512 | 167,957 | — | 298,469 | |||||||||||||||
Italy | — | 744,906 | — | 744,906 | |||||||||||||||
Japan | 591,182 | 2,133,399 | — | 2,724,581 | |||||||||||||||
Netherlands | 310,258 | 205,718 | — | 515,976 | |||||||||||||||
Norway | — | 286,438 | — | 286,438 | |||||||||||||||
Puerto Rico | 44,864 | — | — | 44,864 | |||||||||||||||
Singapore | 175,121 | 143,517 | — | 318,638 | |||||||||||||||
Spain | — | 116,890 | — | 116,890 | |||||||||||||||
Sweden | 386,854 | 55,970 | — | 442,824 | |||||||||||||||
Switzerland | 304,689 | 649,231 | — | 953,920 | |||||||||||||||
United Kingdom | 1,600,214 | 631,962 | — | 2,232,176 | |||||||||||||||
United States | 21,966,641 | — | — | 21,966,641 | |||||||||||||||
Corporate Bonds* | — | 3,677,777 | — | 3,677,777 | |||||||||||||||
Foreign Government Obligations* | — | 5,335,345 | — | 5,335,345 | |||||||||||||||
Quasi Government Bonds* | — | 241,840 | — | 241,840 | |||||||||||||||
Supranational Bonds | — | 1,387,202 | — | 1,387,202 | |||||||||||||||
US Government Securities | — | 212,669 | — | 212,669 | |||||||||||||||
US Municipal Bonds | — | 393,386 | — | 393,386 | |||||||||||||||
US Treasury Securities | — | 1,192,485 | — | 1,192,485 | |||||||||||||||
Short-Term Investments | 995,044 | — | — | 995,044 | |||||||||||||||
Other Financial Instruments† | |||||||||||||||||||
Forward Currency Contracts | — | 66,819 | — | 66,819 | |||||||||||||||
Total | $ | 29,193,686 | $ | 20,400,267 | $ | — | $ | 49,593,953 | |||||||||||
Liabilities: | |||||||||||||||||||
Other Financial Instruments† | |||||||||||||||||||
Forward Currency Contracts | $ | — | $ | (89,255 | ) | $ | — | $ | (89,255 | ) |
Semi-Annual Report 93
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||||
Opportunistic Strategies Portfolio | |||||||||||||||||||
Assets: | |||||||||||||||||||
Exchange-Traded Funds | $ | 87,021,509 | $ | — | $ | — | $ | 87,021,509 | |||||||||||
Closed-End Management Investment Companies | 4,238,640 | — | — | 4,238,640 | |||||||||||||||
Short-Term Investments | 13,341,147 | — | — | 13,341,147 | |||||||||||||||
Total | $ | 104,601,296 | $ | — | $ | — | $ | 104,601,296 | |||||||||||
Liabilities: | |||||||||||||||||||
Securities Sold Short Exchange-Traded Funds | $ | (9,033,007 | ) | $ | — | $ | — | $ | (9,033,007 | ) | |||||||||
Lazard Real Assets and Pricing Opportunities Portfolio | |||||||||||||||||||
Assets: | |||||||||||||||||||
Common Stocks* | |||||||||||||||||||
Australia | $ | — | $ | 633,603 | $ | — | $ | 633,603 | |||||||||||
Canada | 596,649 | — | — | 596,649 | |||||||||||||||
China | — | 72,817 | — | 72,817 | |||||||||||||||
Denmark | — | 16,932 | — | 16,932 | |||||||||||||||
Finland | — | 11,773 | — | 11,773 | |||||||||||||||
France | — | 401,840 | — | 401,840 | |||||||||||||||
Germany | — | 283,460 | — | 283,460 | |||||||||||||||
Hong Kong | — | 472,895 | — | 472,895 | |||||||||||||||
Israel | — | 34,937 | — | 34,937 | |||||||||||||||
Italy | — | 865,603 | — | 865,603 | |||||||||||||||
Japan | — | 431,376 | — | 431,376 | |||||||||||||||
Luxembourg | — | 135,902 | — | 135,902 | |||||||||||||||
Mexico | 54,081 | — | — | 54,081 | |||||||||||||||
Netherlands | — | 17,003 | — | 17,003 | |||||||||||||||
New Zealand | — | 11,470 | — | 11,470 | |||||||||||||||
Norway | — | 16,023 | — | 16,023 | |||||||||||||||
Philippines | — | 69,213 | — | 69,213 | |||||||||||||||
Singapore | — | 126,044 | — | 126,044 | |||||||||||||||
South Korea | — | 13,552 | — | 13,552 | |||||||||||||||
Spain | — | 66,792 | — | 66,792 | |||||||||||||||
Sweden | — | 6,931 | — | 6,931 | |||||||||||||||
Switzerland | — | 88,698 | — | 88,698 | |||||||||||||||
United Arab Emirates | — | 26,714 | — | 26,714 | |||||||||||||||
United Kingdom | 7,463 | 900,175 | — | 907,638 | |||||||||||||||
United States | 4,598,045 | 16,180 | — | 4,614,225 | |||||||||||||||
Exchange-Traded Funds | 382,816 | — | — | 382,816 | |||||||||||||||
Foreign Government Obligations* | — | 1,643,006 | — | 1,643,006 | |||||||||||||||
US Treasury Securities | — | 2,886,414 | — | 2,886,414 | |||||||||||||||
Short-Term Investments | 2,817,949 | — | — | 2,817,949 | |||||||||||||||
Other Financial Instruments† | |||||||||||||||||||
Forward Currency Contracts | — | 9,739 | — | 9,739 | |||||||||||||||
Total | $ | 8,457,003 | $ | 9,259,092 | $ | — | $ | 17,716,095 |
94 Semi-Annual Report
Description | Unadjusted Quoted Prices in Active Markets for Identical Assets and Liabilities (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Balance as of June 30, 2019 | |||||||||||||||
Liabilities: | |||||||||||||||||||
Other Financial Instruments† | |||||||||||||||||||
Forward Currency Contracts | $ | — | $ | (22,081 | ) | $ | — | $ | (22,081 | ) | |||||||||
Futures Contracts | (16,828 | ) | — | — | (16,828 | ) | |||||||||||||
Swap Agreements | — | (183,797 | ) | — | (183,797 | ) | |||||||||||||
Total | $ | (16,828 | ) | $ | (205,878 | ) | $ | — | $ | (222,706 | ) |
* | Please refer to Portfolios of Investments and Notes to Portfolios of Investments for portfolio holdings by country and industry. |
† | Other financial instruments are derivative instruments which are valued at their respective unrealized appreciation (depreciation). |
10. Derivative Instruments
Certain Portfolios may use derivative instruments, including forward currency contracts, futures contracts or swap agreements.
Forward currency contracts may be used for hedging purposes or to seek to increase returns.
A Portfolio may enter into futures transactions to hedge against changes in interest rates, securities prices, and/or currency exchange rates, to increase total return, or to otherwise gain access or attain exposure to certain markets or other underliers.
A Portfolio enters into swap agreements in an attempt to obtain a particular exposure when it is considered desirable to do so, possibly at a lower cost to such Portfolio than if it had invested directly in the asset that yielded the desired exposure.
During the period ended June 30, 2019, the approximate average monthly notional exposure for derivative instruments was as follows:
Semi-Annual Report 95
Derivative Instruments | Global Dynamic Multi-Asset Portfolio | Real Assets and Pricing Opportunities Portfolio | ||||||
Forward currency contracts: | ||||||||
Average amounts purchased | $ | 7,500,000 | $ | 300,000 | ||||
Average amounts sold | 7,200,000 | 4,100,000 | ||||||
Futures contracts: | ||||||||
Average notional value of contracts – long | 2,00,000 | |||||||
Total return swap agreements: | ||||||||
Average notional value | 2,700,000 |
Global Dynamic Multi-Asset Portfolio
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Assets – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized appreciation on forward currency contracts | $ | 66,819 | |||
Liabilities – Derivative Financial Instruments | Total | |||||
Forward currency contracts | Unrealized depreciation on forward currency contracts | $ | 89,255 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Total | |||
Forward currency contracts | $ | 22,579 | ||
Net Change in Unrealized Appreciation (Depreciation) on: | Total | |||
Forward currency contracts | $ | (139,521 | ) |
96 Semi-Annual Report
Real Assets and Pricing Opportunities Portfolio
The following table summarizes the fair value of derivative instruments on the Statement of Assets and Liabilities as of June 30, 2019:
Assets – Derivative Financial Instruments | Commodity Contracts | Equity Contracts | Foreign Currency Contracts | Total | ||||||||||||
Forward currency contracts Unrealized appreciation on forward currency contracts | $ | — | $ | — | $ | 9,739 | $ | 9,739 | ||||||||
Liabilities – Derivative Financial Instruments | Commodity Contracts | Equity Contracts | Foreign Currency Contracts | Total | ||||||||||||
Forward currency contracts | ||||||||||||||||
Unrealized depreciation on forward currency contracts | $ | — | $ | — | $ | 22,081 | $ | 22,081 | ||||||||
Futures contracts Unrealized depreciation on futures contracts | 16,828 | — | — | 16,828 | ||||||||||||
Swap agreements Unrealized depreciation on swap agreements | — | 183,797 | — | 183,797 | ||||||||||||
Total | $ | 16,828 | $ | 183,797 | $ | 22,081 | $ | 222,706 |
The effect of derivative instruments on the Statement of Operations for the period ended June 30, 2019 was:
Net Realized Gain (Loss) from: | Commodity Contracts | Equity Contracts | Foreign Currency Contracts | Total | ||||||||||||
Forward currency contracts | $ | — | $ | — | $ | 86,256 | $ | 86,256 | ||||||||
Futures contracts | (63,095 | ) | — | — | (63,095 | ) | ||||||||||
Swap agreements | — | (35,103 | ) | — | (35,103 | ) | ||||||||||
Total | $ | (63,095 | ) | $ | (35,103 | ) | $ | 86,256 | $ | (11,942 | ) | |||||
Net Change in Unrealized Appreciation (Depreciation) on: | Commodity Contracts | Equity Contracts | Foreign Currency Contracts | Total | ||||||||||||
Forward currency contracts | $ | — | $ | — | $ | (21,404 | ) | $ | (21,404 | ) | ||||||
Futures contracts | 4,598 | — | — | 4,598 | ||||||||||||
Swap agreements | — | 98,858 | — | 98,858 | ||||||||||||
Total | 4,598 | $ | 98,858 | $ | (21,404 | ) | $ | 82,052 |
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As of June 30, 2019, the Global Dynamic Multi-Asset, Opportunistic Strategies and Real Assets and Pricing Opportunities Portfolios held derivative instruments that are eligible for offset in the Statements of Assets and Liabilities and are subject to master netting arrangements. A master netting arrangement is an agreement between two counterparties who have multiple contracts with each other that provides for the net settlement of all contracts, as well as any cash collateral, through a single payment in the event of default on, or termination of, any one contract.
The required information for the affected Portfolios are presented in the below table, as of June 30, 2019:
Global Dynamic Multi-Asset Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | ||||||||||||||
Forward Currency Contracts | $ | 66,819 | $ | — | $ | 66,819 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received | Net Amounts of Derivative Assets | ||||||||||||||
Citibank NA | $ | 16,103 | $ | (8,678 | ) | $ | — | $ | 7,425 | |||||||||
HSBC Bank USA NA | 38,351 | (38,351 | ) | — | — | |||||||||||||
JPMorgan Chase Bank NA | 9,496 | (9,496 | ) | — | — | |||||||||||||
Morgan Stanley Capital Services LLC. | 1,449 | (328 | ) | — | 1,121 | |||||||||||||
State Street Bank and Trust Co. | 1,420 | (1,420 | ) | — | — | |||||||||||||
Total | $ | 66,819 | $ | (58,273 | ) | $ | — | $ | 8,546 |
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | ||||||||||||||
Forward Currency Contracts | $ | 89,255 | $ | — | $ | 89,255 |
98 Semi-Annual Report
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged | Net Amounts of Derivative Liabilities | ||||||||||||||
Citibank NA | $ | 8,678 | $ | (8,678 | ) | $ | — | $ | — | |||||||||
HSBC Bank USA NA | 42,161 | (38,351 | ) | — | 3,810 | |||||||||||||
JPMorgan Chase Bank NA | 29,140 | (9,496 | ) | — | 19,644 | |||||||||||||
Morgan Stanley Capital Services LLC. | 328 | (328 | ) | — | — | |||||||||||||
State Street Bank and Trust Co. | 8,948 | (1,420 | ) | — | 7,528 | |||||||||||||
Total | $ | 89,255 | $ | (58,273 | ) | $ | — | $ | 30,982 |
Lazard Real Assets and Pricing Opportunities Portfolio
Description | Gross Amounts of Recognized Assets | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | ||||||||||||||
Forward Currency Contracts | $ | 9,739 | $ | — | $ | 9,739 |
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Assets Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Received | Net Amounts of Derivative Assets | ||||||||||||||
Citibank NA | $ | 1,931 | $ | (1,931 | ) | $ | — | $ | — | |||||||||
HSBC Bank USA NA | 6,847 | (6,847 | ) | — | — | |||||||||||||
JPMorgan Chase Bank NA | 696 | (696 | ) | — | — | |||||||||||||
Morgan Stanley Capital Services LLC. | 265 | — | — | 265 | ||||||||||||||
Total | $ | 9,739 | $ | (9,474 | ) | $ | — | $ | 265 |
Description | Gross Amounts of Recognized Liabilities | Gross Amounts Offset in the Statement of Assets and Liabilities | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | ||||||||||||||
Forward Currency Contracts | $ | 22,081 | $ | — | $ | 22,081 | |||||||||||
Total Return Swap Agreements | 183,797 | — | 183,797 | ||||||||||||||
Total | $ | 205,878 | $ | — | $ | 205,878 |
Semi-Annual Report 99
Amounts Not Offset in the Statement of Assets and Liabilities | ||||||||||||||||||
Counterparty | Net Amounts of Liabilities Presented in the Statement of Assets and Liabilities | Financial Instruments | Collateral Pledged (a) | Net Amounts of Derivative Liabilities | ||||||||||||||
Citibank NA | $ | 5,673 | $ | (1,931 | ) | $ | — | $ | 3,742 | |||||||||
Goldman Sachs International | 183,797 | — | (183,797 | ) | — | |||||||||||||
HSBC Bank USA NA | 9,596 | (6,847 | ) | — | 2,749 | |||||||||||||
JPMorgan Chase Bank NA | 916 | (696 | ) | — | 220 | |||||||||||||
State Street Bank and Trust Co. | 5,896 | — | — | 5,896 | ||||||||||||||
Total | $ | 205,878 | $ | (9,474 | ) | $ | (183,797 | ) | $ | 12,607 |
(a) | Collateral amounts disclosed in the table above may be adjusted due to the requirement to limit collateral amounts to avoid the effect of over-collateralization. Actual collateral received and/or pledged may be more than the amounts disclosed herein. |
11. Accounting Pronouncements
In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-08,Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities,which amends the amortization period for certain purchased callable debt securities. Management has evaluated the impact of the amendments and has adopted these amendments and incorporated the changes in the current financial statements and related disclosures. For public business entities, the amendments in this ASU became effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018.
In August 2018, the FASB issued an ASU 2018-13,Fair Value Measurement (Topic 820), Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement(the “ASU”) which removes, modifies and adds disclosures to Topic 820. The amendments in this ASU apply to all entities that are required, under existing GAAP, to make disclosures about recurring or non-recurring fair value measurements. The amendments in this ASU are effective for all entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019. Early adoption is permitted. Management has evaluated the impact of
100 Semi-Annual Report
the amendments and has elected to adopt these amendments and incorporate the changes in the current financial statements.
12. Subsequent Events
Management has evaluated subsequent events affecting the Portfolios through the issuance of the financial statements and has determined that there were no subsequent events that required adjustment or disclosure.
Semi-Annual Report 101
Board of Directors and Officers Information (unaudited)
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Independent Directors(3): | ||||
Franci J. Blassberg (1953) | Director (August 2014) | Debevoise & Plimpton LLP, a law firm,Of Counsel(2013 – present) | ||
Cornell Law School,Adjunct Professor(2013 – 2016, 2019) | ||||
The Buchmann Faculty of Law, Tel Aviv University,Visiting Professor(2019) | ||||
University of California, Berkeley School of Law,Adjunct Professor(Spring 2017) | ||||
Kenneth S. Davidson (1945) | Director (August 1995) | Davidson Capital Management Corporation, an investment manager,President (1978 – present) | ||
Landseer Advisors LLC, an investment manager,Senior Advisor(2012 – 2014) | ||||
Nancy A. Eckl (1962) | Director (April 2007) | College Retirement Equities Fund (eight accounts),Trustee (2007 – present) | ||
TIAA-CREF Funds (69 funds) and TIAA-CREF Life Funds (11 funds),Trustee(2007 – present) | ||||
TIAA Separate Account VA-1,Member of the Management Committee(2007 – present) | ||||
Trevor W. Morrison (1971) | Director (April 2014) | New York University School of Law,DeanandEric M. and Laurie B. Roth Professor of Law (2013 – present) | ||
Columbia Law School,Professor of Law(2008 – 2013) | ||||
Richard Reiss, Jr. (1944) | Director (May 1991) | Georgica Advisors LLC, an investment manager,Chairman(1997 – present) | ||
Resource America, Inc., a real estate asset management company,Director(2016 – 2018) |
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Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) and Other Public Company Directorships Held During the Past Five Years(2) | ||
Robert M. Solmson (1947) | Director (September 2004) | Fairwood Capital, LLC, a private investment corporation engaged primarily in real estate and hotel investments,Co-Managing Partner andManaging Director (2008 – present) | ||
Interested Directors(4): | ||||
Ashish Bhutani (1960) | Director (July 2005) | Investment Manager,Chief Executive Officer(2004 – present) | ||
Lazard Ltd,Vice ChairmanandDirector(2010 – present) | ||||
Nathan A. Paul (1973) | Director (October 2017), Chief Executive Officer and President | Investment Manager,Chief Business Officer (April 2017 – present) andManaging Director (2003 – present) | ||
(February 2017; previously, Vice President and Secretary since April 2002) | Investment Manager,General Counsel(2002 – April 2017) |
(1) | The address of each Director of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each Director serves as a Director for each of the funds in the Lazard Fund Complex (comprised of, as of July 31, 2019, 39 active investment portfolios). Each Director serves an indefinite term, until his or her successor is elected, and each Director serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | “Independent Directors” are not “interested persons” (as defined in the 1940 Act) of the Fund. |
(4) | Messrs. Bhutani and Paul are “interested persons” (as defined in the 1940 Act) of the Fund because of their positions with the Investment Manager. |
The Fund’s Statement of Additional Information contains further information about the Directors and is available without charge by calling 800-823-6300, or online, at www.lazardassetmanagement.com.
Semi-Annual Report 103
Name (Year of Birth) Address(1) | Position(s) with the Fund (Since) and Term(2) | Principal Occupation(s) During the Past Five Years | ||
Officers(3): | ||||
Mark R. Anderson (1970) | Chief Compliance Officer (September 2014), Vice President and Secretary (February 2017) | Managing Director (since February 2017, previously Director), Chief Compliance Officer (since September 2014) and General Counsel (since April 2017) of the Investment Manager | ||
Senior Vice President, Counsel and Deputy Chief Compliance Officer of AllianceBernstein L.P. (2004 – August 2014) | ||||
Christopher Snively (1984) | Chief Financial Officer (March 2016) | Senior Vice President of the Investment Manager (since November 2015) | ||
Assurance Manager at PricewaterhouseCoopers LLP (2008 – November 2015) | ||||
Stephen St. Clair (1958) | Treasurer (May 2003) | Vice President of the Investment Manager | ||
Shari L. Soloway (1981) | Assistant Secretary (November 2015) | Head of Legal, North America (since January 2019, previously Senior Vice President, Legal and Compliance (since September 2015)) of the Investment Manager | ||
Vice President and Associate General Counsel of GE Asset Management (July 2011 – September 2015) | ||||
Jessica A. Falzone (1989) | Assistant Secretary (January 2019) | Vice President, Legal and Compliance, of the Investment Manager (since March 2018) | ||
Associate at Schulte Roth & Zabel LLP (2014 – March 2018) | ||||
Cesar A. Trelles (1975) | Assistant Treasurer (December 2004) | Vice President of the Investment Manager |
(1) | The address of each officer of the Fund is Lazard Asset Management LLC, 30 Rockefeller Plaza, New York, New York 10112-6300. |
(2) | Each officer serves for an indefinite term, until his or her successor is elected and qualifies or until his or her earlier resignation or removal. Each officer serves in the same capacity for the other funds in the Lazard Fund Complex. |
(3) | In addition to Nathan A. Paul, Chief Executive Officer and President (since February 2017; previously, Vice President and Secretary since April 2002), whose information is included in the Interested Directors section above. |
104 Semi-Annual Report
The Lazard Funds, Inc.Other Information (unaudited)
Proxy Voting
A description of the policies and procedures used to determine how proxies relating to Fund portfolio securities are voted is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov.
The Fund’s proxy voting record for the most recent 12-month period ended June 30 is available (1) without charge, upon request, by calling (800) 823-6300 or (2) on the SEC’s website at https://www.sec.gov. Information as of June 30 each year will generally be available by the following August 31.
Schedule of Portfolio Holdings
The Fund files its complete schedule of each Portfolio’s holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT. The Fund’s Form N-PORT reports are available on the SEC’s website at https://www.sec.gov.
Board Consideration of Management Agreement
At meetings of the Board held on May 22, 2019 and June 5, 2019, the Board considered the approval, for an additional annual period, of the Management Agreement between the Fund, on behalf of the Portfolios, and the Investment Manager. The Independent Directors were assisted in their review by independent legal counsel, who advised the Board on relevant legal standards and met with the Independent Directors in executive sessions separate from representatives of the Investment Manager.
Representatives of the Investment Manager discussed with the Board the Investment Manager’s written materials provided in advance of the meetings, including, at the June 5, 2019 meeting, additional information requested by the Independent Directors at the May 22, 2019 meeting.
Services Provided
The Investment Manager’s materials addressed, among other matters, the nature, extent and quality of services that the Investment Manager provides the Fund, including a discussion of the Invest-
Semi-Annual Report 105
ment Manager and its clients (of which the Lazard Funds complex of 39 active funds comprised approximately $29 billion of the approximately $235 billion of total assets under the management of the Investment Manager and its global affiliates as of March 31, 2019).
The Board considered the various services provided by the Investment Manager including the Investment Manager’s research, portfolio management and trading capabilities and oversight of day-to-day operations, including supervision of fund accounting and administration-related services and assistance in meeting legal and regulatory requirements, as well as regular reporting to, and support of, the Board. The Investment Manager’s representatives stated that the Investment Manager believes that the Fund and its shareholders continue to be able to obtain significant benefits as a result of the resources and support of the Investment Manager’s global research, portfolio management, trading, operations, risk management, technology and legal and compliance infrastructure. The Board also considered information provided by the Investment Manager regarding its personnel, resources, financial condition and experience; the Fund’s distribution channels and the relationships with various intermediaries; marketing and shareholder servicing activities on behalf of the Portfolios; and Portfolio asset flows and the growth or decline in asset levels. The Board accepted the assertion of representatives of the Investment Manager that the Fund benefits from the services and infrastructure provided by the Investment Manager and that such services and infrastructure are greater than those typically provided to a $29 billion fund complex not managed by a large, global firm such as the Investment Manager.
Comparative Fee, Expense Ratio and Performance Information
The Board reviewed information prepared by Strategic Insight, an independent provider of investment company data, comparing, for the fiscal year ended December 31, 2018, each Portfolio’s:
· | contractual management fee (i.e., without giving effect to any fee waivers), referred to in the Strategic Insight materials as “advisor fee,” expense ratio (net of any fee waivers or expense reimbursements) and performance (for one-, three-, five- and ten-year peri- |
106 Semi-Annual Report
ods ended March 31, 2019, as applicable) to those of a group of comparison funds selected by Strategic Insight (a “Group”); | |
· | advisor fee and expense ratio to a broader group of funds based on the Portfolio’s Morningstar category (an “Expense Universe”); and |
· | performance (for the one-, three-, five- and ten-year periods ended March 31, 2019, as applicable) to that of the funds in the Portfolio’s Morningstar category (a “Category”) and the benchmark index and the Portfolio’s performance for each of the four most recently completed calendar years, as applicable, and the first quarter of 2019, to that of the funds in the Portfolio’s Category and the benchmark index. |
The Strategic Insight materials outlined the process of construction of the Groups, Expense Universes and Categories, and representatives of the Investment Manager and independent legal counsel had previously discussed with the Board in further detail the methodologies used by Strategic Insight in constructing the Groups, Expense Universes and Categories, including how the methodologies could affect the results of the comparisons.
Advisor Fees and Expense Ratios.Representatives of the Investment Manager discussed the results of the Strategic Insight advisor fee and expense ratio comparisons with the Board, which showed that the advisor fees and expense ratios of the Portfolios were competitive within each Portfolio’s respective Group. The Board considered the comparisons, additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager and that the Investment Manager continues to voluntarily enter into expense limitation agreements for all of the Portfolios, pursuant to which the Investment Manager currently was waiving advisor fees and/or reimbursing expenses.
As applicable, the Board also considered fees paid to the Investment Manager by any funds advised or sub-advised by the Investment Manager utilizing the same investment strategies as the Portfolios, as well as any separately managed accounts of the Investment Manager with similar investment objectives, policies and strategies (for
Semi-Annual Report 107
each Portfolio, collectively with such funds, “Similar Accounts”). Representatives of the Investment Manager discussed the nature of the Similar Accounts and the significant differences in services provided by the Investment Manager to the different types of Similar Accounts as compared to the services provided to the Portfolios. The Board considered the relevance of the fee information provided for Similar Accounts, in light of the Investment Manager’s discussion of the significant differences in services provided, to evaluate the fees paid to the Investment Manager by the Portfolios.
Performance.When evaluating the performance of each Portfolio, the Board considered Strategic Insight’s performance analysis along with other information provided by the Investment Manager, including additional performance information, as well as additional perspectives in information prepared by, and in discussions with, representatives of the Investment Manager. The Board also received and would continue to receive regular updates and/or additional information (as requested by the Board) from the Investment Manager.
Investment Manager Profitability and Economies of Scale
The Board reviewed information prepared by the Investment Manager for each Portfolio concerning the estimated profitability percentage of the Management Agreement to the Investment Manager and its affiliates for the calendar year ended December 31, 2018 and the Investment Manager’s cost allocation methodology to compute an estimate of each Portfolio’s costs to the Investment Manager. The Investment Manager’s representatives reviewed with the Board information provided on the Investment Manager’s brokerage practices and the Portfolios’ brokerage allocation, commission payments and soft dollar commissions and benefits. The Investment Manager’s representatives stated that neither the Investment Manager nor its affiliates receive any other significant indirect benefits from the Investment Manager acting as investment manager to the Portfolios. The representatives of the Investment Manager reminded the Board that the Investment Manager is continuing to support distribution relationships through direct payments from its or its affiliates’ own resources to third parties in connection with distribution and shareholder serv-
108 Semi-Annual Report
icing and/or administrative and recordkeeping services, and noted that the Fund does not bear any related costs other than the 0.25% 12b-1 fee pursuant to the Distribution and Servicing Plan adopted for the Portfolios’ Open Shares.
The profitability percentages were within ranges determined by relevant court cases not to be so disproportionately large that they bore no reasonable relationship to the services rendered. The Board (1) considered the Investment Manager’s estimated profitability with respect to each Portfolio as part of their evaluation of the Portfolio’s fee under the Management Agreement, considered in relation to the mix of services provided by the Investment Manager (including the nature, extent and quality of such services), and (2) evaluated the profitability in light of the relevant circumstances for each Portfolio. Representatives of the Investment Manager and the Board discussed ways economies of scale could be realized and how they could be shared, including the Investment Manager’s reinvestment of profits back into its business, waiving or reducing Portfolio management fees and/or reimbursing expenses, adding discounts to a Portfolio’s management fee schedule as a Portfolio’s assets increase or by instituting management fees at inception that account for future scale. It was noted that each Portfolio had declining or generally stable assets, and/or a low level of assets, over the past calendar year so that the potential that the Investment Manager may have realized any economies of scale was reduced.
At the conclusion of these discussions, the Board expressed the opinion that it had been furnished with such information as may reasonably be necessary to make an informed business decision with respect to evaluation of the renewal of the Management Agreement. Based on its discussions and considerations as described above, with the assistance of independent legal counsel and in the exercise of its business judgment, the Board made the following conclusions and determinations.
· | The Board concluded that the nature, extent and quality of the services provided by the Investment Manager are adequate and appropriate, noting the benefits of the significant services and |
Semi-Annual Report 109
infrastructure associated with an approximately $235 billion global asset management business. | |
· | The Board concluded that each Portfolio’s fee paid to the Investment Manager was appropriate under the circumstances and in light of the factors and the totality of the services provided. |
· | The Board, after considering the information provided and the totality of the relevant circumstances for each Portfolio, concluded that the investment performance of each Portfolio was acceptable. |
· | The Board recognized that economies of scale may be realized, particularly as the assets of the Portfolios increase and determined that they would continue to consider potential material economies of scale. |
In evaluating the Management Agreement, the Board relied on the information described above, in addition to information provided by the Investment Manager throughout the year relating to the operations of the Fund and the investment management and other services provided under the Management Agreement, including information on the investment performance of the Portfolios in comparison to similar mutual funds and benchmark performance indices over various time periods; general market outlook as applicable to the Portfolios; and compliance reports. The Board also relied on its previous knowledge, gained through meetings and other interactions with the Investment Manager, of the Investment Manager and the services provided to the Fund by the Investment Manager. The Board considered these conclusions and determinations in their totality and determined to approve the Fund’s Management Agreement for each Portfolio. In deciding whether to vote to approve the Management Agreement for each Portfolio, each Director may have accorded different weights to different factors so that each Director may have had a different basis for his or her decision.
110 Semi-Annual Report
The Lazard Funds, Inc.
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
https://www.lazardassetmanagement.com
Investment Manager
Lazard Asset Management LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Telephone: 800-823-6300
Distributor
Lazard Asset Management Securities LLC
30 Rockefeller Plaza
New York, New York 10112-6300
Custodian
State Street Bank and Trust Company
One Iron Street
Boston, Massachusetts 02210
Transfer Agent and Dividend Disbursing Agent
DST Asset Manager Solutions, Inc.
2000 Crown Colony Drive
Quincy, Massachusetts 02169
Telephone: 617-483-7000
Independent Registered Public Accounting Firm
Deloitte &Touche LLP
30 Rockefeller Plaza
New York, New York 10112-0015
Legal Counsel
Proskauer Rose LLP
Eleven Times Square
New York, New York 10036-8299
http://www.proskauer.com
Lazard Asset Management LLC· 30 Rockefeller Plaza· New York, NY 10112· www.lazardassetmanagement.com | ||
Performance information as of the most recent month end is available online at www.lazardassetmanagement.com. LZDPS030 |
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There were no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Directors during the period covered by this report.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The Registrant’s principal executive and principal financial officers have concluded, based on their evaluation of the Registrant’s disclosure controls and procedures as of a date within 90 days of the filing date of this report, that the Registrant’s disclosure controls and procedures are reasonably designed to ensure that information required to be disclosed by the Registrant on Form N-CSR is recorded, processed, summarized and reported within the required time periods and that information required to be disclosed by the Registrant in the reports that it files or submits on Form N-CSR is accumulated and communicated to the Registrant’s management, including its principal executive and principal financial officers, as appropriate to allow timely
decisions regarding required disclosure.
(b) There were no changes to the Registrant’s internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 13. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications of principal executive and principal financial officers as required by Rule 30a-2(a) under the Investment Company Act of 1940.
(a)(3) Not applicable.
(b) Certifications of principal executive and principal financial officers as required by Rule 30a-2(b) under the Investment Company Act of 1940.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
The Lazard Funds, Inc.
By /s/ Nathan A. Paul
Nathan A. Paul
Chief Executive Officer
Date August 28, 2019
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By /s/ Nathan A. Paul
Nathan A. Paul
Chief Executive Officer
Date August 28, 2019
By /s/ Christopher Snively
Christopher Snively
Chief Financial Officer
Date August 28, 2019