Russell Investments Launches a Frontier Markets Mandate as part of the Russell Emerging Markets Pool

  • Frontier markets potentially offers improved return expectations and greater risk diversification
  • Sub-adviser changes also announced
  • Russell Emerging Markets Equity Pool added to the Russell Diversified Monthly Income Portfolio and most Russell LifePoints Portfolios 

TORONTO, April 7 /CNW/ - Russell Investments Canada Limited announced that it is adding a frontier markets mandate to the Russell Emerging Markets Equity Pool, which is part of the Russell Sovereign Investment Program and a new addition to the Russell LifePoints Program.

"We are excited about the addition of frontier markets to the Pool, as we believe they will help enhance returns and provide further diversification over the long term," said David Feather, President and CEO. "Recent market events have made this region more attractive for long-term investors, and we believe the relatively unexplored frontier region has great potential."

Frontier markets are nations with generally lesser developed economies, who have significant growth potential -- such as Argentina, Bangladesh, Kuwait, Nigeria, Ukraine and Vietnam.

"What has made frontier markets even more compelling are the low correlations to Canadian equities and other developed and emerging markets." said Sadiq Adatia, Chief Investment Officer, Russell Investments Canada. "While it would be expected that frontier markets exhibit a strong positive relationship with emerging markets, surprisingly our analysis shows that has not been the case. For example, the correlation reading between frontier markets and emerging markets is a fairly low 0.40."

The Russell Emerging Markets Equity Pool will generally have a frontier market allocation in the 8-15 per cent range, however may go up to a maximum of 25%.

Sub-adviser changes announced

As part of its added focus on frontier markets, Russell Investments has appointed Harding Loevner LP and Delaware Investment Advisers as sub-advisers of the Russell Emerging Markets Equity Pool, replacing T. Rowe Price International, Inc.

The addition of these two firms provides Russell with the flexibility to gain a diversified exposure to this market and increases the Pool's overall return expectations. They join existing sub-adviser AllianceBernstein.

Russell Emerging Markets Equity Pool also added to the Russell Diversified Monthly Income Portfolio and 4 of the 5 Russell LifePoints Portfolios

Russell Investments believes that including a developing country allocation will add exposure to some of the strongest growth countries in the world, while providing country diversification. It has therefore added the Russell Emerging Markets Equity Pool to Russell Diversified Monthly Income Portfolio, Russell LifePoints Balanced Portfolio, Russell LifePoints Balanced Growth Portfolio, Russell LifePoints Long-Term Growth Portfolio and Russell LifePoints All Equity Portfolio.

"Russell Investments is well known for its innovation and strong sub-adviser selection. With the changes in the Emerging Markets Equity Pool and the addition of this Pool to the Portfolios, investors will benefit from an allocation to the under-researched region of the frontier market, increased diversification and the potential for higher returns over time," says Adatia

About Russell Investments

Founded in 1936, Russell Investments is a global financial services firm that serves institutional investors, financial advisers and individuals in more than 40 countries. The firm has C$154 billion in assets under management (as of December 31, 2010) in its mutual funds, retirement products, and institutional funds.

Russell Canada was recently named the #1 fastest growing money manager in Benefits Canada's 2010 Top 40 Money Managers Report. For more information about how Russell helps to improve financial security for people, visit us at www.russell.com/ca.

Important Information

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 is a publication of Russell Investments Canada Limited and has been prepared solely for information purposes. It is made available on an "as is" basis. Russell Investments Canada Limited does not make any warranty or representation regarding the information.

Russell Investments and the Russell Investments logo are registered trademarks of Frank Russell Company, used under license by Russell Investments Canada Limited.

Copyright © Russell Investments 2011. All rights reserved. This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments.

SOURCE Russell Investments Canada Limited

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