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
Russell Emerging Markets Equity Pool also added to the Russell
Diversified Monthly Income Portfolio and 4 of the 5 Russell LifePoints
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.
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is a publication of Russell Investments Canada Limited and has been
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SOURCE Russell Investments Canada Limited
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