Russell Investments has launched the Russell Multi-Strategy Income Fund, which is available via financial professionals, and invests across a set of asset classes with both income and growth potential using a team of specialist money managers and strategies.
Recognising that market opportunities will likely change over the course of an investor’s time horizon, the fund has built-in flexibility to seek to adapt to risk and opportunities using dynamic portfolio management.
“The demand for income solutions is as great as it has ever been, so this is driving many investors to prioritise short-term income over long-term growth by ‘reaching for yield.’ In this pursuit they are potentially jeopardising their future income needs,” says Phill Rogerson, managing director, consulting and product, for Russell Investments’ US advisor-sold business. “The Russell Multi-Strategy Income Fund is designed to help investors reach for yield responsibly through a diversified approach that balances the need for current income with the potential portfolio growth necessary to sustain future income.”
To accomplish this objective, the fund invests in a broad range of globally diversified income-producing equity, real assets and fixed income securities. A team of specialist third-party managers has been assembled based on their specific expertise in income-producing investments, such as listed infrastructure, REITs, global equity, emerging market debt and global credit. Russell Investments also directly manages a portion of the fund’s assets.
“In the current low interest rate environment, we are seeing investors emphasise income as an investment objective. But if and when interest rates rise, we think that many investors may be subjecting their portfolios to increased risk. Unfortunately, many investors don’t fully appreciate this threat and are not prepared to withstand the risks built into many higher-yielding portfolios,” says Rod Greenshields, consulting director for Russell Investments’ US advisor-sold business. “Our goal with the Russell Multi-Strategy Income Fund is to address the preference that some clients have for yield-oriented investment strategies with an approach that seeks to balance yield and total return objectives.”
Brian Meath, senior portfolio manager, and Rob Balkema, portfolio manager, have primary responsibility for the management of the fund.
“We are looking beyond bonds and borders to deliver a truly global, multi-asset, income-oriented fund,” says Meath. “Taking a multi-asset approach and employing multiple specialist managers requires managing the portfolio as a whole, so that we oversee the total portfolio allocations, manager weights and exposures to proactively and flexibly adapt to risks, as well as income and return opportunities.”