Institutional investors

Currency overlay Does currency matter? International investors receive a return consisting of the gain or loss of the foreign security plus the return on the currency used to purchase the security. Currency volatility can be significant, and the return from the currency can sometimes swamp the gain or loss on the foreign security. What is currency hedging? Currency hedging is eliminating some or all of the foreign exchange volatility from holding international assets. An investor would hedge by selling foreign currencies that are implicitly included in an international portfolio and buying their domestic or base currency. Passive hedging involves selecting and then maintaining a hedge ratio. The hedge ratio represents the percentage of international assets selected for hedging. For example, if an investor has a $1,000,000 international equity portfolio and shields half of the equities from currency effects, the ratio is 50%. The ratio can vary from 0% (no hedging) to 100% (all assets are hedged). How would Russell's currency hedging program work? We will:   Work with you to decide on the features of the program (for example, the frequency of rebalancing the hedge) Gather portfolio information from your custodian Calculate the amount to hedge for each currency Manage trading and settlement Report monthly on the effectiveness of the hedge For more information on Russell's currency hedging solutions, please contact us. We also offer:   Foreign currency trading to help you minimize trading costs and increase portfolio performance. Transaction cost analysis service to analyze your FX trades and suggest appropriate strategies if we find subpar trading results Conscious Currency™ to better manage the currency risk associated with your international assets For more information about our capabilities with foreign exchange trading, please contact David or Gerry:     West Coast David Rothenberg Managing Director 866-926-5934 East Coast Gerry Lillis Director 866-459-4128 Services offered by Russell Implementation Services Inc. a SEC registered investment adviser and broker-dealer member FINRA / SIPC www.finra.org. Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company. Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns. USI-8851			Are you paying too much for fx? Research Are your FX fees too high? Foreign exchange policy oversight: Where is it? How should FX work? (PDF) Conscious Currency™: A new approach to understanding currency exposure (PDF) Webcast How much are you paying for Foreign Exchange? News Russell FX services hit $50 million in total savings Article First Steps in Foreign Exchange Transaction Cost Analysis (PDF) Printer friendly version of this page