According to the announcement, the Russell Commodity Strategies Fund is a new mutual fund that will pursue a commodities strategy with the aim of delivering portfolio diversification and exposure to the long-term performance of global commodity markets. Russell initiated the fund by bringing together two investment managers from separate investment management firms with what was described as “extensive commodities experience”; Credit Suisse Asset Management and Goldman Sachs Asset Management. Both managers have tailored mandates in order to meet the fund’s investment objective, according to the announcement.
Russell has also added the Commodity Strategies Fund as a new underlying fund to its asset allocation strategies, including LifePoints Funds, Target Date Series and Target Portfolio Series. The fund also is available as a standalone fund for advisers who wish to provide their clients with exposure to energy, industrial metals, livestock, precious metals, grains and softs.
The new commodities strategy fund will invest in commodities-linked securities, derivative instruments, cash and fixed income securities that together are intended to provide clients with exposure to the performance of the collateralized commodity futures markets. In addition, Russell says that the fund will invest in a wholly-owned offshore subsidiary that will invest in commodity-linked swaps and other investments in which the fund cannot directly invest for tax reasons.
“In the continued search for better diversification and broader global opportunities, some investors are looking beyond traditional markets to commodities and real assets. While volatile on their own, when included as a small part of a well-diversified portfolio, a commodities strategy has the potential to lower a portfolio’s overall long-term volatility,” said James Ind, portfolio manager at Russell. “Russell already offers commodities strategies to clients in other markets around the world as well as U.S. foundations and endowments, and now we can provide U.S. retail clients with the opportunity to invest in these strategic assets.”
Additional information about the Russell Commodity Strategies Fund is available at: www.russell.com/us/Investment_Products/Russell_Funds/Commodity_Strategies_overview.asp