SOURCE: Russell Investments

Russell Investments

October 06, 2014 10:15 ET

Commodity Currencies Such as Australian and New Zealand Dollar Have Been Hit Hard in September, Negatively Impacting Global Currency Markets as Measured by the Russell Conscious Currency® Index Series

SEATTLE, WA--(Marketwired - Oct 6, 2014) -

"We believe recent signals from the Federal Reserve on future tightening of monetary policy and strengthening of the U.S. economic outlook with dovish signals from the ECB are contributing to the volatility of the currency markets," said Keith Brakebill, senior portfolio manager with Russell Investments.

"Carry," where one currency with a higher expected interest rate is bought while another currency with a lower expected interest rate is sold, is one of three currency components measured by the Russell Conscious Currency Index. The other two components are "value" and "trend." The RCC Carry, Value, and Trend indexes track the dominant factors that drive the currency market.

"Despite negative performance of the Carry and Trend indexes in September, the RCC Value index enjoyed a 1.6% return for the month, helped by a short position to the AUD and long position to the strengthening USD," said Joe Hoffman, director of equity derivatives and foreign exchange at Russell Investments.

In fact, the overall RCCI has delivered positive performance year-to-date through September based on stronger performance of the Value index and Carry index earlier in the year.

 Recent Performance: Russell Indexes

Russell Index   September 2014   3rd Qtr. 2014   YTD 2014 as of 9/30/2014
Russell Conscious Currency® Index   -0.3%   0.0%   0.9%
Russell Conscious Currency Carry Index   -1.0%   0.6%   4.1%
Russell Conscious Currency Value Index   1.6%   0.8%   1.5%
Russell Conscious Currency Trend Index   -1.4%   -1.4%   -3.0%

Source: Russell Investments. Returns are total returns (reflect reinvestment of dividends and distributions) and are denominated in U.S. dollars.

For more information on the Russell Conscious Currency® Index Series, go to the Russell Indexes website.

The Russell Conscious Currency® Index (RCCI) Series is designed to reflect the performance of common foreign currency market factors (Carry, Value and Trend). These indexes are built based on transparent and objective rules and provide investors with non-discretionary benchmarks for use in investing in the foreign exchange market.

Please note: Indexes are unmanaged and cannot be invested in directly. Returns represent past performance, are not a guarantee of future performance, and are not indicative of any specific investment.

Russell's publication of the Indexes or Index constituents in no way suggests or implies a representation or opinion by Russell as to the attractiveness of investing in a particular security. Inclusion of a security in an Index is not a promotion, sponsorship or endorsement of a security by Russell and Russell makes no representation, warranty or guarantee with respect to the performance of any security included in a Russell Index. 

Opinions expressed by Mr. Hoffman and Mr. Brakebill reflect market performance as of September 30, 2014 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance. 

Nothing contained in this material is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specific legal, tax and investment advice from a licensed professional. The information, analysis and opinions expressed herein are for general information only and are not intended to provide specific advice or recommendations for any individual entity.

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Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide, including Russell Investments, and is a subsidiary of The Northwestern Mutual Life Insurance Company.