Russell appoints ClariVest to International Shares Fund and Harris to Global Opportunities Fund
New appointments increase Australian investors' exposure to cross-border investment approaches and well position both Funds to outperform
SYDNEY, 10 January 2008 – Global investment and superannuation specialist, Russell Investment Group, today announced the appointment of ClariVest Asset Management LLC (ClariVest) to its International Shares Fund and Harris Associates LP (Harris) to the Global Opportunities Fund.
ClariVest will manage approximately 15 per cent of the Russell International Shares Fund (International Shares), alongside existing managers ICAP (17 per cent), MFS (15 per cent), Bernstein (15 per cent), Alliance (15 per cent), Turner (13 per cent) and Russell Global Opportunities Fund (10 per cent). Coinciding with this appointment, Jacobs Levy and Altrinsic are no longer managers in International Shares. Within the Russell Global Opportunities Fund (Global Opportunities), Harris was allocated a 10 per cent large-cap mandate, alongside existing managers MFS (30 per cent), Arrowstreet (25 per cent), T Rowe Price (25 per cent), and Axiom (10 per cent).
According to Russell Portfolio Manager, Phil Hoffman, ClariVest's appointment enhances International Shares' quantitative exposure globally. Russell believes that these types of quantitative investment strategies are better suited at the global level where the larger opportunity set and greater market inefficiencies offer more alpha potential. Mr Hoffman also emphasised that Harris' appointment to Global Opportunities will provide the fund with dedicated exposure to a high quality fundamental manager that pursues a concentrated value style.
“What really differentiates ClariVest from many of its peers is the firm's ability to employ sophisticated quantitative techniques to compare stocks on a cross-border basis. ClariVest's models utilise a combination of valuation, momentum and growth signals to identify investment opportunities.
"In regards to Harris, the firm's research process and distinctive value-oriented approach enable the firm to build global large cap portfolios comprised of undervalued or overlooked companies. Portfolio construction is from the bottom up without sensitivity to the benchmark," said Mr Hoffman.
ClariVest's Global investment strategy is headed by David Vaughn, CFA, a founder and an owner of ClariVest Asset Management LLC. Prior to forming ClariVest in March 2006, David worked as the portfolio manager for all international and global Systematic strategies at Nicholas-Applegate and was a member of the Systematic investment team that managed over US$5 billion in assets at the firm. ClariVest believes that investor behaviour drives stock prices, so the firm looks to capture excess return potential created by investors' inefficient responses to growth and contraction cycles. ClariVest's investment process consists of stock selection, portfolio construction and efficient trading.
Harris Associates LP is led by Robert M. Levy, CFA and David G. Herro, CFA as the primary portfolio managers for Harris' Global Large Cap Value Strategy. Bob Levy is the Chairman and Chief Investment Officer (U.S. Equities) and has been with Harris for twenty-two years. David Herro is the Chief Investment Officer (International Equities) and has been at the firm for fifteen years. Harris has seventeen analysts (thirteen U.S. and four Non-U.S.) with an average of over fourteen years experience in the industry. As long-term value investors, Harris looks for three key tenets in every company in which it invests: 1) buy businesses trading at a significant discount to their estimate of intrinsic value; 2) invest in companies expected to grow intrinsic value over time; and 3) invest with management teams that think and act as owners.
Mr Hoffman said that ClariVest preserves International Shares' overall style characteristics, while the firm's quantitative approach to portfolio management continues to drive stock selection as the key driver of the overall fund's active risk. Mr Hoffman said that Harris maintains Global Opportunities' overall style attributes, while increasing the fund's exposure to more aggressive (value/growth) style options.
“The addition of ClariVest to the International Shares Fund increases the fund's global exposure from 30 per cent to 40 per cent, which we believe will better position it to take advantage of more alpha generating opportunities. Harris' addition to the Global Opportunities Fund combined with that of T Rowe Price in early 2007 reduces the weight of 'core' strategies in this fund and shifts the weight more to the style-wings, while increasing the number of high conviction managers," Mr Hoffman concluded.
The Russell International Shares Fund was launched in January 1998 and employs a multi-style, multi-manager approach. It is broadly diversified and provides an ideal vehicle for an investor's core exposure to the international equities markets. The Fund aims to provide exposure to a diversified portfolio of international shares. It seeks to provide a total return, before costs and tax, higher than the MSCI World Net Dividends Reinvested Accumulation Index over the long term. Read more about the Russell International Shares Fund.
The Russell Global Opportunities Fund was launched in January 2005 and utilises as multi-style, multi-manager approach. It is broadly diversified and its global investment brief can be a valuable complement to an investor's core exposure to the international equities market. The Fund aims to provide exposure to a diversified portfolio of international shares, and to outperform significantly the Fund's benchmark, before costs and tax, over the long term. Read more about the Russell Global Opportunities Fund.
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