Lazard Asset Management on Monday completed the conversion of the Lazard International Equity Advantage mutual fund to the International Dynamic Equity Fund (IEQ). The fund is now trading on the NYSE Arca.
IEQ is designed to provide investors diversified exposure to international equities. IEQ’s primary benchmark is the MSCI All Country World ex-US Index (ACWI ex-US), a market capitalization-weighted index that tracks the performance of developed and emerging equity markets outside the United States. The fund’s goal is to provide investors with outperformance relative to its benchmark. It achieves this by constructing a portfolio through a quantitatively driven process. That process considers both risk factors and the firm’s ranking of the securities in question. The fund’s managers look to avoid giving too much weight to individual styles or factors, according to the press release.
The prospectus also notes that the managers continuously monitor companies based on their exposure to valuation, growth and quality, as well as market sentiment around each firm.
“We are seeing the pendulum start to swing toward international equities, which are becoming increasingly attractive to investors,” said Rob Forsyth, Lazard’s Global Head of ETFs. “This conversion allows us to broaden access to a strategy that has historically delivered consistent performance through different market cycles.”
A Tried & Tested Strategy
Lazard’s approach blends machine intelligence with fundamental research, the press release says. According to Forsyth the strategy focuses on high-conviction, concentrated equity positions.
The former mutual fund carries an expense ratio of 0.40% and has $31.1 million in assets under management. Top holdings include TSMC, Iberdrola, Novartis, GSK, Alibaba, Tencent, NatWest, Roche, Japan Post Holdings, and Mitsubishi.
The fund’s investment advisory is led by Lazard Asset Management, with a team of experienced portfolio managers. Those managers include Paul Moghtader, Taras Ivanenko, Peter Kashanek, Alex Lai, Kurt Livermore, Ciprian Marin, Craig Scholl and Susanne Willumsen. The team has carved out a niche with institutional investors. However, Forsyth notes that the launch of IEQ makes the strategy available to a wider audience of investors.
Responding to Active Management Demand
IEQ is designed to harness Lazard’s active management expertise and philosophy.
“Lazard continues to expand their ETF lineup and leverage inhouse international markets expertise,” said Todd Rosenbluth, head of research at TMX VettaFi. “We have seen U.S. ETF-minded advisors begin to look overseas in 2025.”
According to comments made by Forsyth at Exchange earlier this year, the firm will continue to launch ETFs in the U.S. where they see demand aligning with their expertise and investment capabilities. Additionally, Lazard is evaluating opportunities to meet the needs of clients abroad, particularly in Asia-Pacific and Australia, where it already has an established foothold.
IEQ marks the fourth ETF from Lazard listed in the U.S. Earlier this year the firm launched the Lazard Equity Megatrends ETF (THMZ ), Lazard Japanese Equity ETF (JPY ), and Lazard Next Gen Technologies ETF (TEKY ).
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