Russell Investments announced today that the Board of Trustees of
Russell Exchange Traded Funds Trust authorized the orderly termination
and liquidation of Russell’s U.S. passively managed family of
exchange-traded funds (ETFs) on or before October 24, 2012. In
aggregate, the 25 funds affected by this decision had approximately $310
million in assets as of July 31, 2012.
Today’s announcement does not impact the Russell Equity ETF (ONEF),
which is an actively managed, asset allocated portfolio that aligns with
Russell’s focus on multi-asset solutions. Russell will continue to
operate the Russell Equity ETF, which is benchmarked to the Russell
Developed Large Cap Index.
Recognizing the role that ETFs can play in an investment portfolio,
Russell will continue to focus on offering solutions in the actively
managed, asset allocated ETF space as part of its core capability in
investment strategy implementation as well as in the passive ETF space
through its index licensing business. Russell remains the underlying
index provider for many ETFs around the world, which have more than $80
billion in assets under management, and will continue its strong
partnership with all of its ETF sponsor clients.
Regarding the closures, while the innovation behind Russell’s
next-generation ETF products received substantial interest in general,
the market for them is still in its early days. Given challenging equity
market conditions since the launch of these products, Russell determined
that proposing the liquidation of the passively managed ETFs at this
time is in the best interests of the ETFs and their shareholders.
The affected Funds, listed below, will be closed to new investment on
October 9, 2012. The Funds will be delisted from NYSE Arca, Inc. or the
NASDAQ Stock Market LLC, as the case may be, effective at the close of
trading on October 16, 2012, with the respective exchanges halting
trading in the Funds before the open of trading on October 17, 2012.
Full liquidation of the Funds is intended to be completed by October 24,
On October 16, 2012, the Funds will commence the process of liquidating
their assets and, consequently, will not be pursuing their investment
objectives. During the liquidation period between October 16 and October
24, 2012, the passively managed ETFs will not carry on any business,
except for the purposes of winding up their affairs and distributing
investment income, capital gains and assets to shareholders, who may
redeem shares at any point prior to the liquidation date.
Shareholders may sell their holdings on the NYSE Arca or NASDAQ through
October 16, 2012, incurring any applicable transaction fees from their
broker-dealer. All shareholders remaining on October 16, 2012, will
receive cash equal to the amount of the net asset value of their Fund
shares as of October 16, 2012, which will include any capital gains and
dividends, into the cash portion of their brokerage accounts.
Shareholders receiving the final liquidation cash distribution will not
incur transaction fees from their broker-dealer in connection with this
distribution or the cancellation of their Fund shares. Moreover,
shareholders will not bear any expenses associated with the liquidation
of the Funds other than bearing indirectly the portfolio transaction
costs incurred in liquidating the Funds’ assets in advance of the Funds’
About Russell Investments
Russell Investments (Russell) is a global asset manager and one of only
a few firms that offer actively managed multi-asset portfolios and
services that include advice, investments and implementation. Working
with institutional investors, financial advisors and individuals,
Russell's core capabilities extend across capital markets insights,
manager research, Indexes, portfolio implementation and portfolio
Russell has about $152 billion in assets under management (as of
6/30/2012) and works with 2,400 institutional clients, more than 580
independent distribution partners and advisors, and individual investors
globally. As a consultant to some of the largest pools of capital in the
world, Russell has $2.4 trillion in assets under advisement (as of
12/31/11). It has four decades of experience researching and selecting
investment managers and meets annually with more than 2,200 managers
around the world. Russell traded more than $1.5 trillion in 2011 through
its implementation services business. Russell calculates more than
80,000 benchmarks daily covering 98% of the investable market globally,
85 countries and more than 10,000 securities. Approximately $3.9
trillion in assets are benchmarked to the Russell Indexes.
Russell is headquartered in Seattle, Washington, USA. Russell has
offices around the world, including Amsterdam, Auckland, Chicago,
Frankfurt, London, Melbourne, Milan, New York, Paris, San Francisco,
Seoul, Singapore, Sydney, Tokyo and Toronto. For more information about
how Russell helps to improve financial security for people, visit www.russell.com
or follow us@Russell_News.
ETFs are subject to risks similar to those of stocks, including, if
applicable, those related to short-selling and margin account
maintenance. There is no guarantee that dividends will be paid. If
stocks held by the ETF reduce or stop paying dividends, the ETF’s
ability to generate income may be affected. The ETFs are passively
managed and may not match or achieve a high degree of correlation with
the return of their corresponding index. As with all investments, there
are certain risks of investing in an ETF, and you could lose money on an
investment in an ETF.
Investors should carefully consider the investment objectives, risks,
charges and expenses before investing in Russell ETFs. This and other
information can be found in the fund prospectus, which may be obtained
by calling 888-RSL-ETFS (888-775-3837) or by downloading the file from
russelletfs.com. Please read the prospectus carefully before investing.
Russell ETFs are distributed by ALPS Distributors, Inc. (“ALPS”).
Russell Investment Management Company (“RIMCo,” dba Russell Investments)
serves as the investment advisor to the ETFs. ALPS and RIMCo are
separate and unaffiliated. Neither ALPS nor RIMCo nor any of their
affiliates provides tax advice.
Russell Investment Group, a Washington, USA corporation, operates
through subsidiaries worldwide, including Russell Investments. Russell
Investment Group is a subsidiary of The Northwestern Mutual Life
Russell Investments is the owner of the trademarks, service marks and
copyrights related to its indexes.
Russell InvestmentsSteve Claiborne, 206-505-1858 email@example.com
Source: Russell Investments