Does the sound of "don't put all your eggs in one basket" put you off buying shares in a single company, in say the energy sector? For many investors, it's not just the "risk factor", but also their lack of certainty around investment strategies that stops them investing at all.
Well Russell Investments can help make investing easier. In particular, they can reduce the complexity of investing, do the homework for you, and spread your risk with just one fund.
Russell do this by:
- Picking the right mix of investments to optimise returns
- Selecting and blending leading fund managers globally to minimise risk
- Offering you a simple Multi-Manager investment solution
Russell Investments have pioneered a way for investors to feel more at ease about choosing a managed fund that spreads their risk, while providing actively managed investment strategies. They offer what is called "Fund of Funds", or "Multi-manager Funds' a range of managed funds that invest in a carefully balanced selection of the best managed funds.
Russell's approach is to select and blend leading global fund managers to provide investors with easy to choose investment options that cover a range of investment strategies with a fundamental focus on "Diversification", thereby reducing the overall risk of investing while still offering good returns.
Russell's single-sector funds invest in only one sort of asset class at a time, such as Australian shares, and are made up of a selection of the best selection of managed funds that are already investing in a variety of stocks, using a range of investment strategies, which is what provides the diversification. See the below case study to get a better understanding of what a Russell fund looks like.
Multi-Manager Funds are a great entry point to the market for investors who are risk averse and don't have the capacity to do all the homework required when choosing a managed fund. They may also suit investors who might want a "set and forget" style investment solution to start off their portfolio, or are looking to add a level of diversification to their existing portfolio.
Jargon aside, it makes a lot of sense, especially if you are new to investing, or want to gain diversified exposure to Australian and/or international equities. So if your investments are largely made up of cash and perhaps investment property, and you're looking to take the next step to a more active investment solution, these funds could be worth considering.
Case study:
Say you want to invest in shares listed on the ASX, but you think a single stock is too risky. Russell can offer you a single fund that invests in a range of sectors and across a selection of investment styles.
Below is the Russell Australian Shares Fund, and as you can see, within it is a selection of other funds from specialist fund managers and across a blend of investment styles:
Russell Australian Share Fund Overview
Top ten holdings:
BHP Billiton Ltd.; National Australia Bank Ltd.; Westpac Banking Corp.; Australia& New Zealand Banking Group Ltd.; Commonwealth Bank of Australia; Rio Tinto Ltd.; Woolworths Ltd.; Telstra Corp. Ltd.; QBE Insurance Group Ltd.; Wesfarmers Ltd.
| Fund manager | Investment Style | % |
|---|
| Balanced Equity Management | Value: large cap | 17.50 |
| Bernstein | Value | 12.50 |
| Fortis Investments | Growth | 15.00 |
| Karara Capital | Style neutral | 10.00 |
| Dimensional | Small cap | 10.00 |
| Orion Asset Management | Growth | 15.00 |
| Perennial Value | Value | 12.50 |
| Select Holdings | Style neutral | 5.00 |
| Enhanced Insights | Style neutral | 2.50 |
