Russell Investments

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Russell Investments
FTSE Russell logo.png
Founded 1936
Headquarters Seattle, Washington
Key People Len Brennan, President and CEO
Employees 1,800 +
Products Asset management and equity indexes
Website http://www.russell.com/us/SiteNav.asp

Russell Investments is a U.S.-based global asset management and investment consulting group, and creator of the eponymous family of benchmark equity indexes. The firm is a subsidiary of Northwestern Mutual Life Insurance and managed $155.4 billion in assets as of March, 29, 2011. [1]

The company has offices in Seattle, New York, London, Paris, Amsterdam, Sydney, Melbourne, Auckland, Singapore, Seoul, Tokyo, Toronto, Chicago, San Diego, Milwaukee and Edinburgh.

The London Stock Exchange bought Frank Russell for $2.7 billion in June 2014, primarily for its index business.[2]

Russell's series of indexes track the performance of distinct equity markets, asset classes, sector and industry categories worldwide. They include the Russell 1000 and the Russell 2000, which have spawned a host of derivatives contracts traded on a number of U.S. exchanges. The company offers 26 U.S. indexes, which have $4.1 trillion in institutional assets benchmarked to them. More assets are benchmarked to Russell's index family than to all other U.S. equity indexes combined.

The Intercontinental Exchange (ICE) had an exclusive deal to list Russell-based futures and options on futures that began in the third quarter of 2008. ICE transitioned the Russell Index futures to ICE Futures U.S. (formerly the New York Board of Trade) in September of 2008. However, the contract expired in July of 2017 and a new agreement between CME Group and the London Stock Exchange Group went into effect to list Russell index derivatives contracts previously listed only on ICE. The agreement gives CME Group an exclusive license to offer futures, options on futures and cleared over-the-counter products based on FTSE and Russell indexes for 12 years. CME launched the E-mini Russell 2000 Index futures and options suite on July 10, 2017, but for a period of time during the transition the products will be dually listed by CME and ICE.[3] [4]

Russell Investments began an exclusive agreement with NYSE Euronext and CBOE Holdings, Inc. to trade Russell U.S. Index-based options in late April 2013. Options on the Russell 2000 Index of small-cap U.S. stocks were previously listed on several U.S. exchanges.[5]

In February 2015, the London Stock Exchange Group said it had received several approaches to buy the asset-management arm of Frank Russell Co,[6] which has about $260bn under management.[7] The LSE Group put the Russell Investments unit up for sale in February of 2015. It is expected to complete the sale to private equity group TA Associates in the first quarter of 2016.[8]

History

The company was founded in 1936 as a brokerage by Frank Russell in Tacoma, Wash., and expanded as the Frank Russell Company through moves into pension fund consulting in 1969 and then fund management in 1980. George Russell joined his grandfather's business in 1958. Frank died several months later, leaving George and one assistant as the total staff. George took over the company and was CEO until 1993. In 1980, the company started managing money directly for institutions rather than simply providing advice.

Russell's index business began in 1984 with the Russell 1000, Russell 2000 and Russell 3000 indexes, which were created to provide a benchmark for fund manager performance. Northwestern Mutual acquired the business in 1999, renaming it Russell Investment Group in 2003.[9]

In 2008, Russell entered into an exclusive arrangement with the Intercontinental Exchange to list futures and options based on the Russell indexes.

In June 2014, London Stock Exchange Group bought Frank Russell for $2.7 billion in June 2014, primarily for its index business.

Key People

Products and Services

Investment Consulting

Russell follows a disciplined investment consulting process that guides many of the world's largest investors.

Investment Management and Research

Russell manages more than US$180 billion in assets as of Sept. 30, 2008 in about 340 funds, allowing comprehensive and strategic diversification covering the range of asset classes.

Russell Indexes

Russell's US indexes represent nine of the top 10 benchmarks in terms of the number of products as well as the amount of assets, surpassed only by the S&P 500 index.[10]

The U.S. family is based on the Russell 3000E. The large-cap Russell 1000 Index incorporates the largest 1,000 companies in the Russell 3000, with the balance used to form the Russell 2000. The Russell Microcap Index captures 1000 additional stocks, extending total coverage to 4000 in Russell's U.S. index universe. The indexes are reconstituted annually in June, with IPOs added on a quarterly basis.

The indexes have been used to create a range of products - including index futures and options and ETF futures and options - traded on exchanges including: the American Stock Exchange; NASDAQ; Chicago Board Options Exchange, the Intercontinental Exchange (ICE), the New York Board of Trade, the International Securities Exchange, NYSE Arca, the Philadelphia Stock Exchange and the Chicago Mercantile Exchange.

The Russell Global Index was launched in January 2007, using the Russell 3000 Index as its U.S. component, and divided into 300 core indexes covering 22 regions and 63 countries.[11]

Alternative Investments

Russell researches and provides expertise in alternative investment opportunities around the world including real estate, hedge funds and private equity.

Investment Services

Russell provides a full range of investment services, including portfolio management, transition strategies, commission management, cash management, derivatives exposures and agency foreign exchange, which are designed to improve investment performance and minimize the costs and risks of complex investment implementations.

Russell Retirement Services

In North America, Russell delivers target date and target portfolio products directly to Defined Contribution (DC) plan sponsors, as well as distributes LifePoints Funds through financial professionals.

Community

One of Russell's main corporate values includes active involvement in the communities in which its associates live and work. Russell invests in communities through focused giving, corporate giving and a generous cash matching program for contributions of time and money.

References

  1. About US. Russell Investments website.
  2. Shareholders give LSE green light for $2.7 bln Frank Russell deal. Reuters.
  3. Transitioning E-mini Russell 2000® Positions from ICE to CME. CME Group.
  4. E-mini Russell 2000 Index Futures and Options. CME Group.
  5. Russell announces exclusive agreements with NYSE Euronext and CBOE Holdings for Russell U.S. index options. press release.
  6. Buyers Line Up for LSE's Frank Russell Fund-Management Business. Traders Magazine.
  7. LSE to sell Russell asset management unit. The Financial Times.
  8. LSE sells Russell Investments. The Financial Times.
  9. Company Profile. Russell Investments.
  10. Press Release. Russell Investments.
  11. Press release. Russell Investments.