FTSE Russell

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FTSE Russell
FTSE Russell logo.png
Headquarters London
Key People Xavier Rolet, Group CEO; Mark Makepeace, CEO, FTSE Group; Len Brennan, CEO, Russell Investments
Products Financial indexes, benchmarking, data and analytics
Twitter @LSEplc
LinkedIn Profile
Website www.ftserussell.com

FTSE Russell, a wholly owned subsidiary of the London Stock Exchange Group, is a global index leader that provides benchmarking, analytics and data for investors worldwide. FTSE Russell calculates thousands of indexes that measure and benchmark markets and asset classes in more than 70 countries, covering 98% of the investable market. Approximately $10 trillion is currently benchmarked to FTSE Russell indexes. FTSE Russell indexes are used by asset owners, asset managers, ETF providers and investment banks to benchmark their investment performance and create ETFs, structured products and index-based derivatives.[1]

Background

LSE Group's involvement in the index business dates back to 1984, when the exchange began calculating the FTSE 100 Index for the Financial Times' former parent company Pearson. The index team was spun off into a joint venture in 1995.[2] In December 2011, LSE Group agreed to a £450 ($705 million) acquisition of Pearson's 50 percent ownership to become the sole owner of the index group.[3]

In June 2014 the LSE agreed to buy The Frank Russell Company for £1.59 billion ($2.7 billion). The purchase was the largest one in the LSE's history and and gave it the opportunity to attract trading in securities and derivatives that track the Russell indices.[4] It also brought together about $9 trillion of assets benchmarked globally and made LSE the No. 2 player in U.S.-listed exchange traded funds.[5] The deal closed at the end of 2014.[6]

In February 2015, LSE Group entered into a licensing agreement with CBOE to develop and list options based on existing FTSE and Russell Indices. Cash-settled options on the flagship Russell 2000 began trading on CBOE as of April 1, 2015, and in October 2015, the options exchange began offering options on other Russell index products including the Russell 1000 Index (RUI), the Russell 1000 Value Index (RLV) and the Russell 1000 Growth Index (RLG)[7]

When the exchange group acquired Frank Russell, it also inherited Russell Investments, the firm's asset management division which held, at the time of acquisition, about $262 billion under management. Soon after the acquisition was completed, LSE Group put the asset management division up for sale. In October 2015, LSE agreed to a $1.15 billion cash sale to an investment group led by U.S. private equity group TA Associates.[8]

FTSE Explains: What is an Index?, June 2014

Product Groups

FTSE Russell index products can be divided into the following categories:

  • Market capitalization-weighted indexes such as the FTSE UK, Russell US (1000, 2000, 3000), FTSE China and FTSE Global Equity
  • Factor-based indexes
  • Alternatively-weighted indexes such as the Minimum Variance, GDP Weighted, and Equal Weight index classes
  • Fixed income
  • Currency
  • ESG (Environmental, Social and Governance)

A full list of FTSE Russell index products can be found HERE.

FTSE Russell services include:

  • Real time index dissemination
  • Exchange traded funds (ETFs
  • Derivatives, including futures and options on FTSE- and Russell-based indexes
  • Data packages and data licenses


References

  1. About Us. FTSE Russell.
  2. LSE to Buy Rest of FTSE. The Wall Street Journal.
  3. Pearson sells £450m stake in FTSE to London Stock Exchange. The Telegraph.
  4. LSE: A bigger cheese. The Financial Times.
  5. London Stock Exchange to Buy U.S. Asset Manager Frank Russell for $2.7 Billion. The Wall Street Journal.
  6. LSE to conclude Russell deal within weeks. The Financial Times.
  7. CBOE Holdings to Launch New Options on Three FTSE Russell Indexes October 20. CBOE.
  8. LSE to Sell Russell Investments for $1.15 Billion. The Wall Street Journal.