Emerging markets a hot investment for this fund
Lazard Emerging Markets Equity won't be fazed by a difficult 2015
Lazard Emerging Markets Equity is an actively managed portfolio that typically invests in companies that Lazard believes exhibit strong, sustainable financial productivity at attractive valuations.
The fund manager invests primarily in companies whose principal activities are located in emerging market countries or companies that derive a significant portion of their net assets and/or sales from emerging markets.
The fund excludes investments in companies engaged in manufacturing tobacco-related products.
We're confident that the strong investment processes and experienced team at Lazard Emerging Markets Equity will not be fazed by a difficult 2015.
Manager James Donald is a veteran in emerging markets, with over 30 years of investing in the region.
He's capably supported by two portfolio managers and three analysts, each having many years of investment experience and significant time working together.
This longevity has contributed to consistency of returns across varying market conditions.
Insights are also gleaned from Lazard's pool of nine large-cap global analysts who cover developed and emerging markets companies.
They're clustered along global sector lines so they're able to provide colour on competitors and suppliers, increasing the breadth of knowledge of targeted stocks.
The investment strategy, based on Lazard's house philosophy, is solid.
Analysts look for companies showing signs of improving financial productivity trading at compelling prices.
Initial screening is conducted on several valuation metrics before the team analyses how a company's cash flow affects the balance sheet and in turn shareholder value.
Generally, Lazard's close eye on valuations has helped the firm sidestep chancier stocks with embedded price risks, 2015 being an unfortunate exception.
Despite appealing valuations, Donald's bets in Russia and Brazil were hit hard when energy and financial names disappointed.
We believe this was an exception rather than the rule, highlighting why we recommend investors take a longer-term approach to this fund and the asset class in general.
The proven robust investment process and strong team give us assurance in Lazard Emerging Markets Equity's future.
Key fund data Management fee: 1%pa. Morningstar analyst rating: silver. Minimum initial investment: $20,000. Role in portfolio: core.