Lazard Global Total Return and Income Fund: A Deep Dive into Its Monthly Distribution

In the ever-evolving landscape of investment funds, Lazard Global Total Return and Income Fund (NYSE:LGI) has made headlines with its recent declaration of a monthly distribution of $0.14646 per share on common stock. This distribution, payable on April 22, 2025, to shareholders of record on April 10, 2025, is part of the Fund's Managed Distribution Policy. But what does this mean for investors, and how does it reflect the Fund's broader investment strategy and performance?

The Fund's investment portfolio is a diversified mix of 60 to 80 US and non-US equity securities, with a focus on companies with market capitalizations above $2 billion. This includes investments in emerging markets currencies and debt obligations. As of February 28, 2025, Lazard Asset Management and affiliated companies managed $232.9 billion in client assets, demonstrating the Fund's robust asset management capabilities.



The distribution includes components from net investment income, net realized capital gains, and return of capital. For instance, the current distribution of $0.14646 per share is composed of $0.07689 from net realized long-term capital gains and $0.06957 from return of capital. This breakdown indicates that a portion of the distribution may represent a return of capital, which means that some of the money invested in the Fund is being paid back to shareholders. This does not necessarily reflect the Fund's investment performance and should not be confused with "yield" or "income."

The Fund's investment objective is total return, consisting of capital appreciation and current income. As of February 28, 2025, the average annual total return (in relation to NAV) for the 5-year period ending on that date was 10.06%. The annualized current distribution rate expressed as a percentage of NAV as of February 28, 2025, was 9.85%. These figures suggest that the Fund has been able to deliver a consistent return on investment to its shareholders, which is a key factor in maintaining financial stability.

However, the Fund's investment strategy also comes with risks. The Fund's investments in equity securities make it susceptible to market volatility. For instance, the Fund's 52-week high and low share prices were $18.23 and $14.84, respectively, indicating significant price fluctuations. This volatility can impact the Fund's net asset value (NAV) and, consequently, its distributions.

The Fund's investments in non-US equity securities and emerging market currencies expose it to currency risk. Fluctuations in exchange rates can affect the value of these investments and, ultimately, the Fund's distributions. Additionally, the Fund has an effective leverage of 9.34% as of January 7, 2025. While leverage can amplify returns, it can also magnify losses, increasing the risk to the Fund's distributions.



In conclusion, the Fund's investment strategy offers the potential for diversification, global exposure, and income generation. However, it also comes with risks such as market volatility, currency risk, return of capital, and leverage. These factors can influence future distributions, and investors should consider them when evaluating the Fund's investment strategy. The Fund's Managed Distribution Policy provides shareholders with a steady income stream and a consistent return on investment, but it is important for investors to understand the risks and benefits associated with the Fund's investment strategy.