Lazard Listed Infrastructure ETF (GLIX)

Overview

GLIX is a strategic investment fund that aims to capitalize on the long-term growth dynamics associated with global infrastructure development and modernization. The fund is primarily focused on investing in large-cap companies that generate more than 50% of their revenues or assets from infrastructure-related activities. These activities encompass a variety of critical sectors, including water treatment, energy generation and distribution, communication and media services, and the development or operation of essential infrastructure such as pipelines, roads, airports, railroads, and ports.

The investment strategy emphasizes security selection in monopolistic businesses, which are known for delivering stable long-term cash flows. These companies often possess inflation-linked revenues, which provide a level of protection against market fluctuations, resulting in lower volatility as compared to the broader equity market. The portfolio typically comprises between 25 to 50 preferred infrastructure companies, providing a tailored yet diversified investment approach. Additionally, GLIX offers global diversification by including exposure to emerging markets, which can enhance growth potential.

Currency risk is mitigated through the use of foreign currency forward contracts, which help to reduce volatility relative to the US dollar. This approach ensures that investments are somewhat insulated from currency fluctuations. To further enhance liquidity and investment flexibility, the fund may also utilize repurchase agreements and money market instruments, ensuring efficient capital management within its portfolio.

Products and Services

• Investment in Large-Cap Companies:

  GLIX primarily invests in large-cap companies, specifically targeting those that derive over 50% of their revenues or assets from infrastructure activities. This focus allows investors to engage with stable companies that showcase significant growth potential in the infrastructure sector.

• Global Diversification:

  The fund provides exposure to a wide array of markets, including emerging economies. This global diversification can enhance risk-adjusted returns while offering investors opportunities in rapidly growing regions.

• Monopolistic Business Focus:

  GLIX targets monopolistic businesses within the infrastructure space, which are known for generating steady cash flows. This focus seeks to minimize volatility and ensure more predictable returns for investors.

• Currency Risk Hedging:

  The fund employs foreign currency forward contracts to hedge against currency risks. This strategy is designed to reduce volatility for investors and protect the value of their investments against fluctuations in the US dollar.

• Use of Repurchase Agreements:

  GLIX may utilize repurchase agreements to enhance liquidity within its portfolio. This approach allows the fund to engage in short-term borrowing or capital management, ensuring that it can quickly respond to market conditions.

• Money Market Instruments:

  Alongside repurchase agreements, the fund may invest in money market instruments. These investments contribute to liquidity and can provide a safe enclave for capital while waiting for more attractive investment opportunities in infrastructure.