Multi-style
Level 2 of the Russell investment approach
Professional investment managers use unique methodologies to decide which stocks to buy. These methods can generally be categorised into one of several broad investment styles, these styles include:
- Growth - These managers focus on a company's earnings. They are interested in companies that are likely to report profits and shareholder earnings higher than their industry peers.
- Value - Value managers are interested in buying stocks for a good price. They may buy shares in companies that are currently out of favour with the market, believing the stock is a good value for the price.
- Market-oriented - These managers seek to develop well-diversified portfolios with average growth and valuation characteristics similar to the broader market. Many managers seek to add value by emphasising economic sectors they believe are undervalued.
- Small capitalisation - These managers focus on investing in smaller companies. Some of these companies are young and growing rapidly, while others are simply smaller businesses with long histories. These companies are characterised by low dividend yields and above-average volatility.
When investing in a Russell fund, your investment is diversified within each asset class into several complementary investment styles. No matter which style is currently in favour, Russell's blending of investment manager styles can help to manage risk and produce more consistent returns.
We regularly evaluate fund managers for style to ensure that investors’ portfolios stay appropriately diversified over time.
