LAZARD GLOBAL LISTED INFRASTRUCTURE EQUITY A GBP

A global listed infrastructure fund targeting low-volatility returns that exceed inflation.

  • 172.02p Price (Inc)
  • 208.31p Price (Acc)
  • 0.00% 0.00%

    Initial charge
  • 0.85% Annual management charge
  • 0.97% Ongoing charges
  • 2.40% Yield

Prices as at 22 July 2019 , fund data last updated 15 November 2019

The fund seeks to achieve total returns that outperform inflation (CPI), by 5% per annum over rolling five-year periods by investing in the equities of infrastructure companies worldwide. The fund targets "preferred infrastructure", which is defined as companies with monopolistic market structure, regulated and inflation-linked revenues, and low demand volatility. The managers also seek to exclude commodity and power price exposure from the portfolio. The portfolio yield is approximately 3%.

Fund summary

Sector Global
Structure OFFSHORE FUND
Launched April, 2013
Size £1,413m
Yield 2.40%
Charging basis Capital
Dividends paid Apr, Oct

Charges

Initial charge 0.00%
Initial charge via Bestinvest 0.00%
Additional bid/offer spread 0.00%
Annual management charge 0.85%
Ongoing charges figure 0.97%

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Investment process

The managers "preferred infrastructure" investment objective sees the global infrastructure universe of stocks filtered down from 400 to roughly 150 stocks via an initial filter. The second stage of the investment process sees the managers rank stocks based on a deeper dive into qualitative analysis, which focuses on revenue certainty, profitability and longevity factors. This leaves approximately 90 stocks for the third phase of the process, where the managers rank each stock based on its expected return over the next three years, assuming its share price moves to the manager's believed intrinsic value of the stock. The value rank process is applied to both infrastructure sectors and stocks, and is a key construction tool that illustrates the expected return of each stock in the sector. The managers then construct a portfolio of 25-50 stocks based on this analysis and in line with the portfolio concentration rules to ensure diversification. The management team, who are based across Lazard's London, New York and Sydney offices, has a weekly investment meeting that assesses portfolio positioning and construction, with a process of peer review for stock selection.

The managers believe that infrastructure companies are not all equal nor carry the same risks. They focus on “preferred infrastructure”, which is seen as lower risk in the broader global listed infrastructure market due to longevity of assets, predictable cash flows and inflation protections (monopolies can often pass on inflation to the end consumer fairly easily). In contrast to the closed ended investment companies that invest directly in physical infrastructure assets, this fund invests in infrastructure equities listed on stock markets, which have a higher correlation to the wider global equity index (around 0.6) and so provide less diversification. The portfolio tends to be overweight Europe and underweight North America, with historic returns highlighting positive downside protection characteristics relative to the global equity market. The management team are experienced in both the infrastructure and utilities investment sectors.

Manager research

Average monthly relative returns

Bestinvest MRI

14/15 15/16 16/17 17/18 18/19 3 years 5 years Career 3 years 5 years Career
1.07% -1.80% 1.09% -0.11% -0.58% 0.13% -0.06% 0.17% 68.80% 51.60% 82.60%

Performance figures are based on the average of monthly percentage returns relative to the benchmark index.

Lazard Global Infrastructure Team

The team consists of 6 members; 3 based in Sydney, 2 in New York and 1 in London. Bertrand Cliquet, CFA (pictured) is based in London and is one of four portfolio managers on the fund, but also has analyst responsibilities. He joined Lazard in 2004 as a European utility analyst, before becoming a founding member of its Global Listed infrastructure strategy in 2005. Prior to joining Lazard, he was a utility analyst at Goldman Sachs, and an M&A analyst at Deutsche Bank. He attained a business degree from HEC in Paris, with a major in Finance. John Mulquiney, CFA, is a portfolio manager/analyst based in Sydney. Prior to joining Lazard in 2005 he spent four years at Nanyang Ventures, an early expansion venture capital fund. Previously he worked at Tyndall Australia and in the Asset and Infrastructure Group at Macquarie Bank, where he undertook transactions and developed valuation models for airports, electricity generators, rail projects and health infrastructure. He holds a PhD from the Australian National University and a BA from Sydney University. Warryn Robertson is a Portfolio Manager/Analyst based in Sydney. Prior to joining Lazard in 2001, he was an Associate Director at Capital Partners and previously worked at PriceWaterhouseCoopers Corporate Finance. He holds an MBA from the Melbourne Business School (Melbourne University) and a BCom, University of Canberra. Matthew Landy is a Portfolio Manager/Analyst based in New York. Prior to joining Lazard in 2005, he worked in the private equity industry where he was involved in early stage venture capital in Europe and management buy-out investing in Australia. Previously he was also an Equity Analyst with Tyndall Investment Management. Landy has a B. Comm. and a BA from Monash University in Melbourne, Australia.

Track record

Lazard Global Infrastructure Team has 7.6 years experience of managing mutual funds in this sector. Over this period the average monthly return relative to the benchmark index has been +0.17%. During the worst period of relative performance (from November 2015 - October 2016) there was a decline of 28% relative to the index. The worst absolute loss has been 9%. Statistically, we estimate the probability that this fund manager is adding value, rather than being lucky, is 83%.

Periods of worst performance

Absolute -9.00% (November 2017 - February 2018)
Relative -28.00% (November 2015 - October 2016)

About the MRI

Our unique indicator: the Bestinvest Manager Record Index (MRI) measures the likelihood that the fund manager is adding value through their decisions. It is based on their performance record over the course of their career, adjusted for the amount of risk taken. MRI is an important contributor to our fund rating system but it is also vital to take account of qualitative factors. It is also very important to select funds to form a cohesive portfolio with an appropriate overall risk level.

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Top 10 holdings

Atlantia 8.7%
Norfolk Southern 8.7%
National Grid 8.1%
Terna 7.8%
Vinci 4.7%
Transurban 4.6%
Severn Trent 4.6%
Snam Rete Gas 4.6%
United Utilities 4.6%
Kansas City Southern 4.5%
Source: Lazard

Portfolio

The portfolio typically comprises investment in between 25 and 50 companies from a universe of 150 stocks that meet the fund's "preferred infrastructure" characteristics. The fund also seeks diversification across countries and sectors.

Constraints

1-8% in single stock typical positions. Max 10% of company's market cap. Excludes exposure to commodity / power prices - seeks companies with contractual / regulated prices. Min market cap $250m.

Key Investor Documents

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