New portfolio developments over the last week include two new funds and from Russell Investments, equity allocation changes to other Russell funds, and a projection on custom target-date funds from Cerulli.
In addition, ArtBanc allied with NFP Life to advise owners of fine art on tax and estate planning issues involving their collections.
Here are the latest developments of interest to advisors:
1) Russell Investments Launches Two New Funds, Changes Allocations
Russell Investments announced Wednesday the launch of two new funds, the Russell Multi-Strategy Alternative Fund (RMSEX) and the Russell U.S. Strategic Equity Fund (RSESX), and updates to theU.S. equity allocation of many of its portfolios.
These reallocations included changing the investment strategies, names and benchmarks of the Russell U.S. Growth Fund (RSGCX) and the Russell U.S. Quantitative Equity Fund (REQTX) to incorporate insights based on the Russell Stability Indexes style-based benchmarks. The Russell U.S. Growth Fund was renamed the Russell U.S. Dynamic Equity Fund and the Russell U.S. Quantitative Equity Fund was renamed the Russell U.S. Defensive Equity Fund.
RMSEX seeks to achieve long-term capital growth with low correlation to, and lower volatility than, global equity markets. Its benchmark is the Barclays U.S. 1-3 Month Treasury Bill Index.
RSESX is an open-ended fund employing a multiasset approach to gain exposure toU.S.large- and medium-capitalization companies. It seeks to provide long-term capital growth, and will initially feature 10 manager assignments, representing five investment styles—defensive, dynamic, growth, value and market-oriented—and multiple substyles. Its benchmark is the Russell 1000 Index.
The Russell U.S. Dynamic Equity Fund, previously the Russell U.S. Growth Fund, has changed its investment strategy from investing in growth stocks to a dynamic style of investing, and may implement a limited long-short strategy. Its benchmark will change from the Russell 1000 Growth Index to the Russell 1000 Dynamic Index.
Additionally, the Russell U.S. Defensive Equity Fund, previously the Russell U.S. Quantitative Equity Fund, will change its investment strategy from a quantitative investment approach to a defensive style of investing and discontinue the limited long-short strategy. Its benchmark will change from the Russell 1000 Index to the Russell 1000 Defensive Index.
2) Custom TDFs Will Surge to $218 Billion by 2016: Cerulli
Cerulli Associates projects that custom target-date strategies will account for 22% of 401(k) target-date assets by 2016, the consulting group said Friday in “The Cerulli Report: State of Large and Mega Defined Contribution Plans: Investment Innovation and the Plan Sponsor Perspective.” This would put the amount of custom target-date fund assets in defined contribution plans at $218 billion, up 370% from the $46.4 billion posted in 2011.
Given that target-date funds had overall second-quarter returns of 2.8% and 12-month returns of -0.5%, according to the research group Ibbotson Associates, investors may be looking for custom target-date funds as a way to improve returns.
Read the full story on AdvisorOne.
3) ArtBanc and NFP Form Alliance to Advise Fine Art Owners
Wealthy individuals and families with significant collections of paintings, sculpture, photography or jewelry face unique estate planning and tax issues.
The partners will address the reduction of potential estate tax and estate distribution taxes, penalties and proper planning for tax implications of fine art collection ownership. They will also enable clients to borrow against their collections to help resolve estate tax and estate planning issues.
Read the full story on AdvisorOne.
Read the Aug. 10 Portfolio Products Roundup on AdvisorOne.