August 07, 2012
Investments unveiled a series of six target-duration liability-driven investing
(LDI) commingled trust funds. ---
Each LDI fund will be benchmarked to a comparable composite
of the Barclays-Russell LDI Index Series.
The Russell Target Duration LDI Funds seek to provide high
quality, mostly corporate bond-based exposure to fixed-income securities which
closely match those found in discount curves used to value U.S. pension
liabilities. The funds are designed to be used in combination as part of an
overall LDI program, but also aim to achieve modest outperformance versus their
respective Barclays-Russell LDI indices by combining diversified adviser styles
and strategies over a full market cycle.
“The new Russell Target Duration LDI Funds act as building
blocks to create client-specific LDI strategies that provide a closer cash flow
match of assets to liabilities than can be achieved through a single long
credit strategy,” said Martin Jaugietis, CFA and director, head of LDI
solutions. “They also contain less mark-to-market basis risk versus liabilities
discounted using a corporate yield curve than comparable swaps-based target
The fund names will reflect target durations. The Russell
LDI Fixed Income Fund will be available in 6-, 8-, 10-, 12-, 14- and 16-year
Calvin (Chenglong) Gong, CFA, FSA and CMT, serves as the
portfolio manager for Russell’s overall LDI solution set, including the
combined Target Duration LDI Fund series, while Gerard Fitzpatrick, CFA and
FRM, serves as the portfolio manager for each individual LDI fund. As the
portfolio manager responsible for the LDI hedging solution for U.S.
institutional clients, Gong works closely with Jaugietis and reports to Jeff
Hussey, Global Chief Investment Officer, Fixed Income.