Russell Investments has expanded its range of exchange-traded funds (ETF) to six with the release of its first multi-strategy product, which is centred on environmental, social and governance (ESG)-related considerations.
The Russell Investments Sustainable Global Opportunities Complex ETF (ASX code: RGOS) will provide investors with access to an actively managed portfolio of international shares based on the investment strategies of other global equity managers Russell considers have ESG capabilities.
The investment manager stated it had evaluated more than 200 global equity managers for inclusion in the portfolio and currently had four other firms – Sparinvest, Wellington Management, Neuberger Berman and Mirova – alongside itself as the underlying managers, creating a mix of value, quality and growth investing styles.
Additions or replacements to the manager list will take place as required and the fund will aim to outperform the MSCI All Country World Net Index before costs, which include a fee of 0.95 per cent a year on assets under management, and tax, while also disclosing its full holdings each day.
Russell Investments head of global equities Will Pearce and senior portfolio manager James Harwood will head up the management of the fund’s investment portfolio, with Harwood noting it could be considered as part of a core international shares allocation in a balanced portfolio.
“For ESG-focused investors it is a balance between deliberate security selection in line with their values, while not being constrained by the opportunity set or bearing excessive risk,” Harwood said.
“Our multi-strategy approach provides a diversified exposure to sustainable global shares with lower equity factor and stock risks, compared to a typical single manager active ESG-related strategy.
“Individual active ESG managers can lean towards investment styles such as growth or quality and either large or small cap.
“RGOS uses complementary managers to balance these factors to provide less volatile performance patterns, while still pursuing excess returns above RGOS’ global equity benchmark.”
While RGOS is the first multi-strategy ETF for Russell Investments, it currently offers three fixed income and two Australian share ETFs.
