Russell Investments launches short term income pool
TORONTO, Aug. 30, 2012 /CNW/ - Russell Investments Canada Limited (Russell) announced the launch of the Russell Short Term Income Pool and Class, designed for Canadian investors who want to hold fixed-income securities that offer the potential for lower volatility and less interest-rate risk than longer-duration fixed income funds.
"The addition of this new pool to Russell's suite of fixed-income products further broadens the choices we offer investors, as well as continues to enhance our multi-asset portfolio solutions," said David Feather, President and Chief Executive Officer, Russell Investments Canada. "Russell offers a comprehensive selection of fixed-income funds to Canadians. Our new Russell Short Term Income Pool is suitable for investors who are concerned about ongoing volatility and future interest-rate increases. We also believe this new pool offers a higher-yielding alternative to money market funds. Depending on a client's risk tolerance, Russell now provides the flexibility to invest in a number of options, from short-term to high yield bonds in both corporate class and trust series."
The Pool will invest in a broad range of Canadian investment-grade securities including a selection of domestic short-term corporate bonds, floating-rate notes, asset-backed securities, mortgage-backed securities, and other investment-grade credit products, with maturities of up to five years. It may also invest in foreign fixed income securities on a currency hedged basis. These securities offer the potential for capital appreciation, as well as interest income.
The Pool is expected to have lower volatility with less interest-rate risk than fixed-income funds that invest in longer-dated securities. The Russell Short Term Income Class offers investors tax efficiency in their non-registered investments. For investors interested in a U.S. money market alternative, Russell will offer the U.S. Dollar Hedged Series option. It will provide investors with a return in U.S. dollars that will be highly correlated to the fund's performance in Canadian-dollar terms, by reducing the effect of exchange rate fluctuations between the two currencies.
The Pool will be sub-advised by three fixed-income managers, each bringing complementary investment strategies. With this Pool, Russell is pleased to initiate a relationship with the well-proven teams of Phillips, Hager & North Investment Management™ and AEGON Capital Management, as well as deepen its long-standing relationship with Canso Investment Counsel.
Phillips, Hager & North Investment Management™ (40%), or PH&N™, was founded in 1964. Since then, the Vancouver-based firm has grown to become one of Canada's leading investment managers. PH&N uses a diversified multi-strategy approach to generating alpha through duration, credit selection, sector allocation and yield curve management. It represents the institutional business of RBC Global Asset Management Inc.
AEGON Capital Management (40%), based in Toronto, is a unit of AEGON N.V., the Netherlands-based insurance and financial services company that manages more than US$500 billion in assets globally. ACM has been investing on behalf of several of Canada's top pension funds, foundations and institutions for more than 15 years. It uses a credit-focused investment approach with security selection being the key source of alpha. ACM will have a broad credit mandate that will include an allocation to high quality Asset-Backed Securities and Mortgage-Backed Securities.
Canso Investment Counsel Ltd. (20%) is based in Richmond Hill, Ont. and manages corporate bond portfolios for sophisticated institutional and private investors. Its team of professionals has more than 80 years of combined corporate debt, banking and rating agency experience. It will have a specialized credit mandate with a focus on higher-yielding securities and will include Floating-Rate Notes and Maple bonds among other securities. It offers a deep-value credit sector investment approach.
Investors can invest in the individual Pool or Class, or access them through a Russell multi-asset portfolio solution, in either the LifePoints or Sovereign Investment Programs. The Russell Short Term Income Pool will be included in the Russell LifePoints Fixed Income Portfolio and Class with a 20% allocation, the Russell LifePoints Conservative Income Portfolio and Class with a 15% allocation, and the Russell LifePoints Balanced Income Portfolio and Class with a 10% allocation. Within the Sovereign Investment Program, it will be included in the Russell Income Essentials Portfolio and Class with a 10% allocation. It will also be added to some of the Russell model portfolios.
Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
Nothing in this publication is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. This information is made available on an "as is" basis. Russell Investments Canada Limited does not make any warranty or representation regarding the information.
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About Russell Investments
Russell Investments (Russell) is a global asset manager and one of only a few firms that offer actively managed, multi-asset portfolios and services that include advice, investments and implementation. Working with institutional investors, financial advisors and individuals, Russell's core capabilities extend across capital markets insights, manager research, Indices, portfolio implementation and portfolio construction.
Russell has about C$155 billion in assets under management (as of 6/30/12) and works with 2,400 institutional clients, more than 580 independent distribution partners and advisors, and individual investors globally. As a consultant to some of the largest pools of capital in the world, Russell has $2.4 trillion in assets under advisement (as of 12/31/11). It has four decades of experience researching and selecting investment managers and meets annually with more than 2,200 managers around the world. Russell traded more than $1.5 trillion in 2011 through its implementation services business. Russell calculates more than 80,000 benchmarks daily covering 98 percent of the investable market globally, 85 countries and more than 10,000 securities. Approximately $3.9 trillion in assets are benchmarked to the Russell Indices.
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