Lazard Equity Megatrends ETF (THMZ)

Lazard Equity Megatrends ETF (NASDAQ: THMZ) is an actively managed exchange-traded fund built around the conviction that certain structural, multi-decade trends will drive corporate earnings and stock returns. The fund identifies these megatrends—demographic shifts, climate transition, digital innovation—and selects global equities positioned to benefit.

The megatrend thesis

THMZ rests on the idea that certain long-term global transformations will reshape corporate economics for 15–30 years, and that investors can outperform by owning companies positioned to serve those shifts. Lazard identifies four main megatrends.

Demographic ageing in developed nations is increasing demand for healthcare, pharmaceuticals, medical devices, elder care, and wellness services. The energy transition—away from fossil fuels and toward renewables, battery technology, and efficiency—is reallocating hundreds of billions in capital. Digital transformation continues remaking every industry: cloud infrastructure, artificial intelligence, automation, and cybersecurity are reshaping how companies operate and compete. Urbanization is concentrating global population in megacities, driving investment in transit, housing, water systems, and urban services.

These are not short-term cyclical bets; they are structural shifts that will play out over decades. Companies serving these trends are expected to grow earnings faster than the broader market, or at least to command premium valuations as the market prices in the opportunity earlier than it has so far.

Active selection and global scope

Unlike a passive index fund that holds all constituents in fixed weights, Lazard’s managers actively research and select companies they believe authentically benefit from these megatrends. The fund invests globally—across developed and emerging markets—because these trends are borderless. A renewable-energy equipment maker in Germany, a semiconductor supplier in Taiwan serving AI demand, a healthcare company in Japan targeting older populations, or an infrastructure play in Brazil can all be holdings if the managers believe the thesis supports them.

This global, active approach requires judgment. The same megatrend can justify different stocks depending on competitive positioning, valuation, and growth prospects. The fund’s edge, if it exists, lies in Lazard’s ability to identify which companies will outperform within the broader trend.

Costs and risks

THMZ charges an expense ratio that reflects active management—measurably higher than passive global index funds. The question for investors is whether the thematic lens and stock selection produce outperformance that exceeds that cost.

The fund’s main risk is megatrend mispricing. If digital transformation advances more slowly than the market expects, or if energy transition adoption slows, the premium prices paid today may not be justified by earnings growth tomorrow. Concentration risk is inherent in any thematic fund: fewer holdings than a broad index means both amplified upside and downside. Currency exposure and emerging-market volatility add layers of risk beyond the sector or thematic thesis itself.

How to research THMZ

Start with Lazard’s prospectus and fund factsheet, which detail the investment philosophy and current holdings. Review the top ten holdings and ask yourself whether each company authentically serves one of the named megatrends and whether its valuation seems justified. Check the annual portfolio turnover—high turnover suggests the managers are constantly reassessing, while low turnover suggests conviction. Read Lazard’s white papers or published research on their megatrends framework to understand how they identify and weigh these trends. Because the fund is global, confirm your comfort with currency exposure and emerging-market concentration before investing a significant position.