Form 497K LAZARD FUNDS INC
Lazard Funds Summary Prospectus April 29, 2016
Before you invest, you may want to review the Portfolios Prospectus, which contains more information about the Portfolio and its risks. The Portfolios Prospectus and Statement of Additional Information (SAI), both dated April 29, 2016 (as revised or supplemented), are incorporated by reference into this Summary Prospectus. You can find the Portfolios Prospectus, SAI and other information about the Portfolio online at www.LazardNet.com/lam/us/lazardfunds.shtml. You can also get this information at no cost by calling (800) 823-6300 or by sending an e-mail request to [email protected].
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Institutional |
Open |
R6 |
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Lazard Emerging Markets Debt Portfolio |
LEDIX |
LEDOX |
RLEDX |
Investment Objective
The Portfolio seeks total return from current income and capital appreciation.
Fees and Expenses
This table describes the fees and expenses that you may pay if you buy and hold shares of the Portfolio, a series of The Lazard Funds, Inc. (the Fund).
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Institutional |
Open |
R6 |
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Shareholder Fees (fees paid directly from your investment) |
1.00% |
1.00% |
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1.00% |
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Annual Portfolio Operating Expenses (expenses that you pay each year as a |
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Management Fees |
.80% |
.80% |
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.80% |
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Distribution and Service (12b-1) Fees |
None |
.25% |
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None |
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Other Expenses |
.16% |
.70% |
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.16% |
* |
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Total Annual Portfolio Operating Expenses |
.96% |
1.75% |
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.96% |
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Fee Waiver and Expense Reimbursement** |
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.45% |
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.01% |
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Total Annual Portfolio Operating Expenses After Fee Waiver and Expense Reimbursement** |
.96% |
1.30% |
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.95% |
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* |
Other Expenses are based on estimated amounts for the current fiscal year, using Other Expenses for Institutional Shares from the last fiscal year. |
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** |
Reflects a contractual agreement by Lazard Asset Management LLC (the Investment Manager) to waive its fee and, if necessary, reimburse the Portfolio until May 1, 2017, to the extent Total Annual Portfolio Operating Expenses exceed 1.00%, 1.30% and .95% of the average daily net assets of the Portfolios Institutional Shares, Open Shares and R6 Shares, respectively, and from May 1, 2017 through May 1, 2026, to the extent Total Annual Portfolio Operating Expenses exceed 1.10%, 1.40% and 1.05% of the average daily net assets of the Portfolios Institutional Shares, Open Shares and R6 Shares, respectively. All limitations on Total Annual Portfolio Operating Expenses are exclusive of taxes, brokerage, interest on borrowings, fees and expenses of Acquired Funds and extraordinary expenses, and excluding shareholder redemption fees or other transaction fees. This agreement can only be amended by agreement of the Fund, upon approval by the Funds Board of Directors, and the Investment Manager to lower the net amount shown and will terminate automatically in the event of termination of the Investment Management Agreement between the Investment Manager and the Fund, on behalf of the Portfolio. |
Example
This Example is intended to help you compare the cost of investing in the Portfolio with the cost of investing in other mutual funds.
The Example assumes that you invest $10,000 in the Portfolio for the time periods indicated and then hold or redeem all of your shares at the end of those periods. The Example also assumes that your
investment has a 5% return each year and that the Portfolios operating expenses remain the same, giving effect to the fee waiver and expense reimbursement arrangement described above. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
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1 Year |
3 Years |
5 Years |
10 Years |
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Institutional Shares |
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$ |
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98 |
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$ |
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306 |
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$ |
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531 |
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$ |
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1,178 |
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Open Shares |
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$ |
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132 |
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$ |
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433 |
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$ |
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756 |
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$ |
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1,671 |
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R6 Shares |
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$ |
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97 |
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$ |
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305 |
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$ |
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530 |
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$ |
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1,177 |
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Portfolio Turnover
The Portfolio pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Portfolio shares are held in a taxable account. These costs, which are not reflected in annual portfolio operating expenses or in the Example, affect the Portfolios performance. During the most recent fiscal year, the Portfolios portfolio turnover rate was 162% of the average value of its portfolio.
Principal Investment Strategies
The Portfolio invests primarily in debt securities issued or guaranteed by governments, government agencies or supranational bodies or companies or other private-sector entities, including fixed and/or floating rate investment grade and non-investment grade bonds, convertible securities, commercial paper, collateralized debt obligations, short- and medium-term obligations and other fixed-income obligations, and may invest in money market instruments such as certificates of deposit. The securities in which the Portfolio invests may be denominated in the US dollar, the Canadian dollar, the Euro, the Japanese yen, the Pound Sterling, or the local currency of the issuer.
Under normal circumstances, the Portfolio invests at least 80% of its assets in debt securities that are economically tied to emerging market countries. Emerging market countries include all countries not represented by the MSCI® World Index. The Portfolio currently intends to focus its investments in Asia, Africa, the Middle East, Latin America and the developing countries of Europe, although the allocation of the Portfolios assets among countries and regions may vary from time to time based on the Investment Managers judgment and its analysis of market conditions.
The Portfolio may invest without limitation in securities rated below investment grade (e.g., lower than Baa by Moodys Investors Service, Inc. or lower than BBB by Standard & Poors Ratings Group) (junk bonds) or securities that are unrated. Additionally, the Portfolio is not restricted to investments in securities of any particular maturity or duration. Duration is an estimate of the sensitivity of the price (the value of principal) of a fixed-income security to a change in interest rates. Generally, the longer the duration, the higher the expected volatility. For example, the market price of a fixed-income security with a duration of three years would be expected to decline 3% if interest rates rose 1%. Conversely, the market price of the same security would be expected to increase 3% if interest rates fell 1%.
The Portfolio may, but is not required to enter into forward currency contracts and credit default swaps, for hedging purposes or to seek to increase returns.
The Portfolio is classified as non-diversified under the Investment Company Act of 1940, as amended, which means that it may invest a relatively high percentage of its assets in a limited number of issuers, when compared to a diversified fund.
Principal Investment Risks
The value of your investment in the Portfolio will fluctuate, which means you could lose money.
Fixed-Income and Debt Securities Risk. The market value of a debt security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. The debt securities market can be susceptible to increases in volatility and decreases in liquidity. Liquidity can decline unpredictably in response to overall economic conditions or credit tightening.
2Summary Prospectus |
Prices of bonds and other debt securities tend to move inversely with changes in interest rates. Interest rate risk is usually greater for fixed-income securities with longer maturities or durations. A rise in interest rates (or the expectation of a rise in interest rates) may result in periods of volatility, decreased liquidity and increased redemptions, and, as a result, the Portfolio may have to liquidate portfolio securities at disadvantageous prices. Risks associated with rising interest rates are heightened given that interest rates in the US and other countries are at or near historic lows.
The Portfolios investments in lower-rated, higher-yielding securities (junk bonds) are subject to greater credit risk than its higher rated investments. Credit risk is the risk that the issuer will not make interest or principal payments, or will not make payments on a timely basis. Non-investment grade securities tend to be more volatile, less liquid and are considered speculative. If there is a decline, or perceived decline, in the credit quality of a debt security (or any guarantor of payment on such security), the securitys value could fall, potentially lowering the Portfolios share price. The prices of non-investment grade securities, unlike investment grade debt securities, may fluctuate unpredictably and not necessarily inversely with changes in interest rates. The market for these securities may be less liquid and therefore these securities may be harder to value or sell at an acceptable price, especially during times of market volatility or decline.
Some debt securities may give the issuer the option to call, or redeem, the securities before their maturity. If securities held by the Portfolio are called during a time of declining interest rates (which is typically the case when issuers exercise options to call outstanding securities), the Portfolio may have to reinvest the proceeds in an investment offering a lower yield (and the Portfolio may not fully benefit from any increase in the value of its portfolio holdings as a result of declining interest rates).
Market Risk. Market risks, including political, regulatory, market and economic developments, and developments that impact specific economic sectors, industries or segments of the market, can affect the value of the Portfolios investments. In addition, turbulence in financial markets and reduced liquidity in equity, credit and/or fixed income markets may negatively affect many issuers, which could adversely affect the Portfolio.
Issuer Risk. The value of a security may decline for a number of reasons which directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuers goods or services, as well as the historical and prospective earnings of the issuer and the value of its assets or factors unrelated to the issuers value, such as investor perception.
Non-US Securities Risk. The Portfolios performance will be influenced by political, social and economic factors affecting the non-US countries and companies in which the Portfolio invests. Non-US securities carry special risks, such as less developed or less efficient trading markets, political instability, a lack of company information, differing auditing and legal standards, and, potentially, less liquidity.
Emerging Market Risk. Emerging market countries can generally have economic structures that are less diverse and mature, and political systems that are less stable, than those of developed countries. The economies of countries with emerging markets may be based predominantly on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme debt burdens or volatile inflation rates. The securities markets of emerging market countries have historically been extremely volatile. These market conditions may continue or worsen. Significant devaluation of emerging market currencies against the US dollar may occur subsequent to acquisition of investments denominated in emerging market currencies.
Foreign Currency Risk. Investments denominated in currencies other than US dollars may experience a decline in value, in US dollar terms, due solely to fluctuations in currency exchange rates. Currency investments could be adversely affected by delays in, or a refusal to grant, repatriation of funds or conversion of emerging market currencies.
Liquidity Risk. The lack of a readily available market may limit the ability of the Portfolio to sell certain securities at the time and price it would like. The size of certain debt securities offerings of emerging markets issuers may be relatively smaller in size
Summary Prospectus3 |
than debt offerings in more developed markets and, in some cases, the Portfolio, by itself or together with other Portfolios or other accounts managed by the Investment Manager, may hold a position in a security that is large relative to the typical trading volume for that security; these factors can make it difficult for the Portfolio to dispose of the position at the desired time or price.
Non-Diversification Risk. The Portfolios net asset value may be more vulnerable to changes in the market value of a single issuer or group of issuers and may be relatively more susceptible to adverse effects from any single corporate, industry, economic, market, political or regulatory occurrence than if the Portfolios investments consisted of securities issued by a larger number of issuers.
Forward Currency Contracts and Other Derivatives Risk. Forward currency contracts and other derivatives transactions, including those entered into for hedging purposes, may increase volatility or reduce returns, perhaps substantially, particularly since most derivatives have a leverage component that provides investment exposure in excess of the amount invested. Forward currency contracts, over-the-counter options on currencies, swap agreements and other over-the-counter derivatives transactions are subject to the risk of default by the counterparty and can be illiquid. These derivatives transactions, as well as the exchange-traded options in which the Portfolio may invest, are subject to many of the risks of, and can be highly sensitive to changes in the value of, the related currency, security or other reference asset. As such, a small investment could have a potentially large impact on the Portfolios performance. Derivatives transactions incur costs, either explicitly or implicitly, which reduce return. Successful use of derivatives is subject to the Investment Managers ability to predict correctly movements in the direction of the relevant reference asset or market. Use of derivatives transactions, even if entered into for hedging purposes, may cause the Portfolio to experience losses greater than if the Portfolio had not engaged in such transactions.
High Portfolio Turnover Risk. The Portfolios investment strategy may involve high portfolio turnover (such as 100% or more). A portfolio turnover rate of 100%, for example, is equivalent to the Portfolio buying and selling all of its securities once during the course of the year. A high portfolio turnover rate could result in high transaction costs and an increase in taxable capital gains distributions to the Portfolios shareholders, which will reduce returns to shareholders.
Performance Bar Chart and Table
Year-by-Year Total Returns for Institutional Shares
As of 12/31
The accompanying bar chart and table provide some indication of the risks of investing in Lazard Emerging Markets Debt Portfolio by showing the Portfolios year-by-year performance and its average annual performance compared to those of broad measures of market performance. The bar chart shows how the performance of the Portfolios Institutional Shares has varied from year to year. Updated performance information is available at www.LazardNet.com or by calling (800) 823-6300. The Portfolios past performance (before and after taxes) is not necessarily an indication of how the Portfolio will perform in the future.
4Summary Prospectus |
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Best Quarter: |
Average Annual Total Returns
(for the periods ended December 31, 2015)
After-tax returns are shown only for Institutional Shares. After-tax returns of the Portfolios other share classes will vary. After-tax returns are calculated using the historical highest individual marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investors tax situation and may differ from those shown. The after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts. Returns shown below for the Portfolios R6 Shares (which were not operational as of December 31, 2015) reflect the performance of the Portfolios Institutional Shares. R6 Shares would have had substantially similar returns as Institutional Shares because the share classes are invested in the same portfolio of securities, and the returns would differ only to the extent that the classes do not have the same expenses.
The 50% JPMorgan Emerging Market Bond Index Global Diversified Index/50% JPMorgan Government Bond IndexEmerging Markets Global Diversified Index shown in the table is an unmanaged index created by the Investment Manager, and is a 50/50 blend of the JPMorgan Emerging Market Bond Index Global Diversified Index and the JPMorgan Government Bond IndexEmerging Markets Global Diversified Index.
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Inception |
1 Year |
Life of |
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Institutional Shares: |
2/28/11 |
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Returns Before Taxes |
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-8.55% |
0.11% |
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Returns After Taxes on Distributions |
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-8.55% |
-1.30% |
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Returns After Taxes on Distributions and |
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-4.84% |
-0.36% |
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Open Shares (Returns Before Taxes) |
2/28/11 |
-8.64% |
-0.16% |
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R6 Shares (Returns Before Taxes) |
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-8.55% |
0.11% |
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JPMorgan Emerging Market Bond Index Global Diversified® Index |
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1.18% |
5.62% |
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JPMorgan Government Bond Index Emerging Markets Global Diversified® Index |
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-14.92% |
-3.58% |
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50% JPMorgan Emerging Market Bond Index Global Diversified Index/ |
-6.10% |
1.22% |
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Summary Prospectus5 |
Management
Investment Manager
Lazard Asset Management LLC
Portfolio Managers/Analysts
Arif T. Joshi, portfolio manager/analyst on the Investment Managers Emerging Markets Debt team, has been with the Portfolio since February 2011.
Denise S. Simon, portfolio manager/analyst on the Investment Managers Emerging Markets Debt team, has been with the Portfolio since February 2011.
Purchase and Sale of Portfolio Shares
The initial investment minimums are:
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Institutional Shares* |
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$ |
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100,000 |
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Open Shares* |
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$ |
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2,500 |
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R6 Shares** |
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$ |
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1,000,000 |
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* |
Unless the investor is a client of a securities dealer or other institution which has made an aggregate minimum initial purchase for its clients of at least $100,000 for Institutional Shares or $2,500 for Open Shares. |
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** |
There is no minimum investment amount for R6 Shares purchased by certain types of employee benefit plans and individuals considered to be affiliates of the Fund or the Investment Manager, discretionary accounts with the Investment Manager and affiliated and non-affiliated registered investment companies. |
The subsequent investment minimum for Institutional Shares and Open Shares is $50.
Portfolio shares are redeemable through the Funds transfer agent, Boston Financial Data Services, Inc., on any business day by telephone, mail or overnight delivery. Clients of financial intermediaries may be subject to the intermediaries procedures.
Tax Information
All dividends and short-term capital gains distributions are generally taxable to you as ordinary income, and long-term capital gains are generally taxable as such, whether you receive the distribution in cash or reinvest it in additional shares.
Financial Intermediary Compensation (Open and Institutional Shares only)
Payments to Broker-Dealers and Other Financial Intermediaries
If you purchase shares of the Portfolio through a broker-dealer or other financial intermediary (such as a bank), the Portfolio and/or the Investment Manager and its affiliates may pay the intermediary for the sale of Portfolio shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Portfolio over another investment. Ask your salesperson or visit your financial intermediarys website for more information.
00078674
Lazard Asset Management LLC 30 Rockefeller Plaza New York, NY 10112 www.lazardnet.com
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