The Fund is a long/short equity fund that seeks high, absolute returns primarily by investing in a globally diversified portfolio of equities and equity-related securities, which are held directly by the Fund and not through an offshore investment vehicle. The Fund is driven by security selection and therefore attempts to mitigate risk through fundamental analysis and diversification. While there are no hard limits on the number of holdings, as a practical matter the Fund will typically hold no more than a total of 250 positions, long and short.

As part of the overall strategy, the Fund will hedge to the extent practicable, against fluctuations in the Australian Dollar/US Dollar exchange rates through the use of forward currency contracts.

The following outlines the Fund's long and short strategies in more detail:

Long Equity Strategy

The long strategy is designed to highlight the stock selection skill of Lazard Asset Management’s investment professionals. It invests long in companies with superior business attributes such as a strong franchise, dominant market share, or strong management that the portfolio management team believes are currently undervalued relative to their global industry group. It is the Team’s belief that these characteristics allow a company superior returns on capital employed. The Fund’s strategy is to select those ideas which are timely and most likely to generate high absolute returns upon recovery from undervaluation.

Short Equity Strategy

The Fund uses short equity positions primarily for profit by selling short the shares of companies that we believe to be fundamentally flawed in some way. The Fund may also use short equity positions for protection by offsetting some of the risks of the long portfolio. The aim is to achieve this by constructing a short portfolio that attempts to pair off small slices of risk by industry and sector. Companies that the Fund takes a short position in generally operate in businesses with, among other features, weak fundamentals, compromised business plans, few, if any, barriers to entry, the tendency for low returns on invested capital, or in which the company’s management has made a strategic mistake. The industries that tend to find their way into the short side of the portfolio are cyclical and capital intensive industries and those with declining rates of return on capital.