SOURCE: Russell Investments

Russell Investments

July 18, 2013 11:30 ET

Indirect Exposure: Russell Developed Europe Large Cap EM GeoExposure Index YTD Performance Reflects an Alternative Way for European Investors to Gain Exposure to Emerging Markets

SEATTLE, WA--(Marketwired - Jul 18, 2013) - The Russell Emerging Markets Index is down (-5.9%) year-to-date as of July 16th amid growing political instability in various emerging market countries and further indications of slowing growth in China. 

Comparing this performance to the Russell Developed Europe Large Cap EM Geographic Exposure ("GeoExposure") Index, which is designed to track the performance of European companies with significant exposure to targeted emerging markets, helps underscore how an indirect approach to gaining emerging markets exposure may be beneficial in today's volatile markets. The GeoExposure Index has exhibited higher returns than the Russell Emerging Markets Index year-to-date while providing exposure to European companies which derive a significant portion of their revenue from emerging markets. 

"The Russell GeoExposure Indexes offer multi-asset investors a new strategy for tapping into emerging markets' economic growth, reflecting the performance of companies domiciled in developed Europe which may be well positioned for such participation," said Tom Goodwin, Ph.D. and Senior Research Director with Russell Indexes. "With increasing globalization, European companies will continue to operate across several different regions and countries as they seek to benefit from economic growth in regions outside their home countries. Geographic exposure provides a new way to disentangle the country and regional exposures of multinational companies, by providing a new set of tools for multi-asset portfolio analysis, benchmarking and asset allocation." 

Russell Indexes Performance

Index   July MTD as of July 16th
1st QTR

2nd QTR
2013 YTD as of July 16th
Russell Emerging Markets Index  


Russell Developed Europe LC EM GeoExposure Index   3.6% 4.7% -4.0% 4.1%

Source: Russell Investments. Returns are euro-denominated.

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.

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. Index returns are presented in euro-denominated terms. 

Opinions expressed by Mr. Goodwin reflect market performance and observations as of July 16th, 2013 and are subject to change at any time based on market or other conditions without notice. Past performance does not guarantee future performance.

The Russell Global Index includes more than 10,000 securities in 48 countries and covers 98% of the investable global market. All securities in the index are classified according to size, region, country and sector. Daily Returns for the main components are available here:  

Investments in emerging or developing markets involve exposure to economic structures that are generally less diverse and mature, and to political systems which can be expected to have less stability than those of more developed countries. Securities may be less liquid and more volatile than US and longer-established non-US markets.

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.