Annualized Returns
Name 3-Month YTD 1-Year 3-Year 5-Year 10-Year Since Inception (%; Gross of fees) (06/01/2004) Lazard Emerging Markets Equity Select ADR - SMA 0.3 -7.4 1.5 28.0 N/A N/A 30.2 (%; Net of fees) Lazard Emerging Markets Equity Select ADR - SMA -0.5 -8.8 -1.6 24.7 N/A N/A 27.0 MSCI Emerging Markets Index -0.9 -11.8 4.6 27.1 N/A N/A 28.4
Performance is presented gross and net of all fees. Net of fees performance has been calculated using a 3.0% fee assumption. Gross of fee performance is presented as supplementary information, as performance excludes transaction costs. Please refer to the disclosures for important additional details of this composite. The performance quoted represents past performance. Past performance does not guarantee future results.

		Lazard			MSCI Emerging Markets Index
Number of Securities		31			798
Current Dividend Yield (%)		3.2			2.3
Average Weighted Market Cap ($ billions)		17.4			67.6
Turnover – Trailing 12 Months (%)		40.2			N/A

Characteristics

Equity	94.3
Cash and Equivalents	5.7
Argentina	6.5
Banco Macro Bansud (ADR)
Tenaris (Spon ADR)
Brazil	16.8
Cemig (Spon ADR)
Companhia Vale do Rio Doce (Spon ADR)
Embraer Aircraft (Spon ADR)
Iochpe Maxion (ADR)
Klabin (Spon ADR)
TAM (ADR)
India	3.6
Satyam Computer Services (Spon ADR)
Indonesia	3.6
Telekomunik Indonesia (Spon ADR)
Israel	2.1
Teva Pharmaceutical Industries (Spon ADR)
Mexico	13.4
Cemex (Spon ADR)
Desarrolladora Homex (ADR)
Femsa (Spon ADR)
Grupo Televisa (Spon ADR)
Kimberly-Clark de Mexico (ADR)

Philippines	3.2
Philippine Long Distance Telephone (Spon ADR)
Russia	4.5
Mobile Telesystems (Spon ADR)
Singapore	3.5
COSCO (Spon ADR)
South Africa	14.4
Aquarius Platinum (Spon ADR)
Eqstra Holdings (Spon ADR)
Imperial Holdings (Spon ADR)
Kumba Iron Ore (ADR)
Naspers N Shares (Spon ADR)
Nedbank Group (Spon ADR)
South Korea	12.7
Kookmin Bank (Spon ADR)
Shinhan Financial Group (Spon ADR)
SK Telecom (Spon ADR)
Taiwan	6.2
Advanced Semiconductor Engineering (ADR)
Taiwan Semiconductor Manufacturing (Spon ADR)
Turkey	3.7
Turkcell Iletisim Hizmetleri (Spon ADR)

1. Portfolio characteristics are based upon a representative portfolio which represents the proposed investment for a fully discretionary account. Source: Lazard, FactSet.
2. The allocations mentioned are based upon a representative portfolio which represents the proposed investment for a fully discretionary account. Allocations are subject to change.
3. The allocations and specific securities mentioned are based upon a representative portfolio which represents the proposed investment for a fully discretionary account. Allocations and security selection are subject to change. It should not be assumed that any of the referenced securities were or will be profitable, or that the investment decisions we make in the future will be profitable. All information provided in this list should not be considered a recommendation or solicitation to purchase or sell any particular security. Please note that cash is not viewed as a strategic asset class.

Stocks in the developing world were volatile in the second quarter of 2008. Markets rose significantly in April and May, as investors’ fears about a U.S. recession and financial crisis receded. However, worries about high commodity prices and inflation pushed markets sharply lower in June. The MSCI Emerging Markets Index decreased by less than 1.0% over the entire quarter, which disguised an increase of more than 10.0% in the first two months of the quarter, followed by a drop of almost 10.0% in June. Helped by strong commodity prices, especially crude oil, which hit a new all-time high during the period, shares in Latin America outperformed Eastern Europe and Asia.

No major emerging market in Asia ended the second quarter with positive returns. China’s rebound in April was more than offset by weakness in May and June. Shares in India were subjected to severe profit taking, as investors became concerned about inflationary pressures. Pakistan’s market sustained large decreases following further political strife between President Musharraf and the country’s judges and leading politicians, prompting Standard & Poor’s to downgrade the currency.

A wide divergence in returns was recorded across Eastern European, Middle Eastern and African markets. Strong commodity prices helped South African and Russian equities, the latter benefiting in particular from official announcements of lower corporate taxes as a means to offset falling oil production. Offsetting this trend was weakness in the previously-strong markets of Egypt and Poland, where investors noted the relative absence of attractive valuations.

Apart from the relatively expensive markets of Chile and Peru, all other Latin American equity markets were positive in the second quarter. The more commodity-sensitive markets of Argentina and Brazil were helped a great deal by energy companies Petrobras and Tenaris, which rose sharply. Brazilian equities also benefited from two credit agency upgrades, Standard & Poor’s and Fitch Ratings. The more domestically-focused markets of Colombia and Mexico did not perform as well.

By sector, energy stocks performed particularly better than the Index over the quarter, and the materials sector outperformed the Index as well. Significant underperformers included the financials, consumer discretionary, information technology, telecom services and industrials sectors.

4. The allocations and specific securities mentioned are derived from a representative portfolio which represents the proposed investment for a fully discretionary account. Allocations and security selection are subject to change. The information provided should not be considered a recommendation or solicitation to purchase or sell any particular security. There is no assurance that any securities referenced herein will remain in the account’s portfolio or that securities sold have not been repurchased. The securities discussed may not represent the account’s entire portfolio. It should not be assumed that any of the referenced securities were, or will prove to be profitable, or that the investment decisions we make in the future will be profitable.

Foreign securities may be less liquid, more volatile, and less subject to governmental supervision than in the United States. The values of foreign securities are affected by changes in currency rates, application of foreign tax laws, changes in government administration, and economic and monetary policy. Many emerging markets countries have experienced substantial rates of inflation, which have had, and may continue to have, adverse effects on the securities markets of some of these countries.