Russell Investments Portfolio Series – Growth is an Managed Funds investment product that is benchmarked against Multi-Asset Aggressive Investor Index and sits inside the Multi-Asset - 81-100% Multi-Manager Index. Think of a benchmark as a standard where investment performance can be measured. Typically, market indices like the ASX200 and market-segment stock indexes are used for this purpose. The Russell Investments Portfolio Series – Growth has Assets Under Management of 57.08 M with a management fee of 0.8%, a performance fee of 0 and a buy/sell spread fee of 0.36%.
The recent investment performance of the investment product shows that the Russell Investments Portfolio Series – Growth has returned 1.31% in the last month. The previous three years have returned 4.69% annualised and 10.39% each year since inception, which is when the Russell Investments Portfolio Series – Growth first started.
There are many ways that the risk of an investment product can be measured, and each measurement provides a different insight into the risk present. They can be used on their own or together to perform a risk assessment before investing, but when comparing investments, it is common to compare like for like risk measurements to determine which investment holds the most risk. Since Russell Investments Portfolio Series – Growth first started, the Sharpe ratio is NA with an annualised volatility of 10.39%. The maximum drawdown of the investment product in the last 12 months is -6.64% and -42.41% since inception. The maximum drawdown is defined as the high-to-low decline of an investment during a particular time period.
Relative performance is what an asset achieves over a period of time compared to similar investments or its peers. Relative return is a measure of the asset's performance compared to the return to the other investment. The Russell Investments Portfolio Series – Growth has a 12-month excess return when compared to the Multi-Asset - 81-100% Multi-Manager Index of -1.59% and 0.12% since inception.
Alpha is an investing term used to measure an investment's outperformance relative to a market benchmark or peer investment. Alpha describes the excess return generated when compared to peer investment. Russell Investments Portfolio Series – Growth has produced Alpha over the Multi-Asset - 81-100% Multi-Manager Index of NA% in the last 12 months and NA% since inception.
For a full list of investment products in the Multi-Asset - 81-100% Multi-Manager Index category, you can click here for the Peer Investment Report.
Russell Investments Portfolio Series – Growth has a correlation coefficient of 0.99 and a beta of 1.06 when compared to the Multi-Asset - 81-100% Multi-Manager Index. Correlation measures how similarly two investments move in relation to one another. This establishes a 'correlation coefficient', which has a value between -1.0 and +1.0. A 100% correlation between two investments means that the correlation coefficient is +1. Beta in investments measures how much the price moves relative to the broader market over a period of time. If the investment moves more than the broader market, it has a beta above 1.0. If it moves less than the broader market, then the beta is less than 1.0. Investments with a high beta tend to carry more risk but have the potential to deliver higher returns.
For a full quantitative report on Russell Investments Portfolio Series – Growth and its peer investments, you can click here for the Peer Investment Report.
For a full quantitative report on Russell Investments Portfolio Series – Growth compared to the Multi-Asset Aggressive Investor Index, you can click here.
To sort and compare the Russell Investments Portfolio Series – Growth financial metrics, please refer to the table above.
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The portfolio returned 4.33%^ in January. Overweights to listed growth assets, i.e. Australian and global equities, contributed positively to performance. An overweight to extended fixed income assets also added value.
During the quarter, there were changes to positioning within the dynamic core of the managed portfolio. Early in the period, bond duration was increased, while equity options protection was added in December after a strong rebound. Both of these changes are likely to reduce volatility if recession risks continue to rise. We also modestly increased our weighting to Metrics Credit during the quarter. Overall, the managed portfolio is aligned with its long-term asset allocation as we wait patiently for opportunities.
The direct Australian equity portfolio underperformed the benchmark. A modest underweight to the strong-performing utilities space detracted from returns. Stock selection within the materials and energy sectors also weighed on performance, including overweights to Ampol and James Hardie. Partly offsetting these positions was a nil exposure to Pilbara Minerals, which fell sharply over the period. Stock selection within the financials space also added value; notably an overweight to Suncorp Group. In terms of global equity managers, UK equity specialist J O Hambro significantly outperformed its benchmark, benefiting in part from stock selection within the communication services and utilities sectors. Emerging markets specialist Oaktree Capital and core global equities manager Fiera Capital also outperformed. Looking ahead, we expect higher levels of volatility to continue, with active management to play an important role in navigating through it. We expect to increase growth asset exposure on major market reversals and decrease growth asset exposure on market rallies. This is a very important time to remain flexible as there are competing forces related to inflation and growth. We retain the same themes as recent months, i.e. a preference for emerging markets over developed markets and overweights to both global small caps and floating rate credit.
The Portfolio typically invests in a diversified investment mix with exposure to growth investments of around 90% and defensive investments of around 10% over the long term, however the allocations will be actively managed within the allowable ranges depending on market conditions.
Global share markets made good gains in November, driven in part by hopes the US Federal Reserve (Fed) may soon pivot to smaller rate hikes amid speculation US inflation has peaked. The Fed raised interest rates by a further 0.75% early in the period after headline inflation jumped 8.2% in the 12 months to 30 September. However, subsequent data showed that headline inflation slowed to 7.7% in the 12 months to 31 October, which was the measure’s lowest reading since January and less than the 7.9% rise the market had anticipated. Compounding this were the minutes from the Fed’s November meeting, which revealed a substantial majority of participants judged that a slowing in the pace of rate increases would likely soon be appropriate. Stocks also benefited from preliminary data that showed consumer prices in the euro-zone slowed in the 12 months to 30 November, Beijing’s decision to begin walking back some of its COVID-19 prevention measures and easing Sino-US tensions. Australian shares also performed well, benefiting from the Reserve Bank of Australia (RBA)’s decision to continue raising rates by just 0.25%, easing inflation and strong gains across the major miners.
Global bonds outperformed in November amid softer US and European inflation figures and the asset class’s traditionally defensive qualities in the face of heightened geopolitical risks.
The portfolio returned 5.35%^ in October. Overweights to listed growth assets, i.e. Australian and global equities, contributed positively to performance. An overweight to extended fixed income assets also added value.
Global share markets made strong gains in October even as the world’s major central banks continued to raise interest rates in the face of persistently high inflation. Investors were instead encouraged by speculation that officials may soon pivot toward a less aggressive monetary policy stance given the typical lag effects of higher interest rates and the potential impact that sharply higher rates will have on economic growth. Share markets also benefited from a series of positive US and European earnings updates, as well as speculation that stocks, which have sold off sharply so far this year, may have reached the bottom. Australian shares also performed well, driven largely by the Reserve Bank of Australia’s decision to cut interest rates by less than expected despite uncomfortably high inflation. Government bonds continued to underperform against a backdrop of rising interest rates.
During the quarter, we removed the Vanguard Australian Shares Index ETF and increased our small caps exposure by adding the Vanguard MSCI Australian Small Companies Index ETF. We also diversified listed real assets away from Australian listed property by selling the Vanguard Australian Property ETF and buying both the Vanguard International Property Fund and the Vanguard Global Infrastructure Fund. Overall, the portfolio is aligned with its long-term asset allocation as we wait patiently for opportunities in this volatile environment.
The portfolio returned -0.41%^ in August. Overweights to equities and credit detracted from performance, including global high-yield debt, which gave back the previous month’s gains. In contrast, stock selection within equities added value over the period.
Toward the end of the month, we introduced several new strategies to further diversify the portfolio. Specifically, we added Australian small caps to complement our large cap direct stock exposure, and global property and infrastructure to diversify away from our Australian property exposure. We also added emerging market bonds to diversify the portfolio’s extended fixed income exposure. Overall, the portfolio is aligned with its long-term asset allocation as we wait patiently for opportunities in this volatile environment.
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