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Portfolio > Alternative Investments > Private Equity

NYFE to List Russell Equity Indexes

By Staff Writer

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NEW YORK (HedgeWorld.com)–The New York Board of Trade announced an agreement with the Frank Russell Co., Tacoma, Wash., allowing NYBOT the right to list futures and options contracts based on 21 Russell U.S. equity indexes.

The product rollout will begin in coming weeks on NYBOT’s New York Futures Exchange Inc. subsidiary.

It will start with futures on the Russell 1000 Value index and Russell 1000 Growth (symbols VV and GG). These will be cash settled and will have a contract size of 500 times the index.

“As the world already knows, Russell is widely respected as an index provider that offers only the highest quality product. It is our pleasure to continue to partner with the Russell organization in offering these new index products,” said Charles H. Falk, NYBOT’s chairman, in a statement April 17.

NYBOT has taken this step because the new products reflect the choice between value and growth, a distinction that has gained in importance in recent years to become a fundamental element in portfolio strategies.

“Managing the volatility of the growth/value cycle can be one of the most important challenges for investors in the equities markets,” said Joseph J. O’Neill, senior executive vice president of NYBOT, in the statement.

From Dec. 31, 1997 through the first quarter of 2000, the Russell 1000 Growth Index outperformed the Russell 1000 Value Index by roughly 70%. On the other hand, from March 31, 2000 to March 31, 2003, the Russell 1000 Value Index has outperformed its growth counterpart by almost 40%.

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