Products December 10, 2009

New Russell Indexes Track Small to Mid-Cap Equity Segment

Russell Investments has launched a set of benchmarks to track the small to mid-cap segment of the global equity market, known as SMID cap.

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According to a press release, the Russell Global SMID Index provides investors with an objective measure of the group of stocks that rank toward the bottom of the large cap segment and the top of the small cap segment. A subcomponent of the Russell Global Index, the Russell Global SMID Index initially covers 3,981 of those securities with a market capitalization range from about $370 million to $5.3 billion.

“Active managers looking to profit from informational inefficiencies and behavioral biases tend to favor small to mid capitalization companies,” said James Carpenter, senior research analyst in Russell’s Investment Division, in the press release. “Investment managers believe this space is attractive because many companies are well run but are not yet recognized.”

Carpenter added that the new benchmarks serve as tools to attribute manager performance and more clearly assess the opportunity set in which these managers work.

Russell also launched a family of subcomponent benchmarks that roll up into the Russell Global SMID such as the Russell Global SMID Growth Index and Russell Global SMID Emerging Markets Index. The methodology begins with the universe of stocks in the Russell Global Index, then each stock is objectively ranked by market capitalization in descending order, and Russell calculates each member’s cumulative weight by its official security market capitalization size. Those that fall within the designated range are members of the index.

For the U.S. market, Russell also offers the U.S. Russell 2500 Index as a similar option, the announcement said.

Total returns for the Russell Global SMID Index will be available and updated daily here.

Products December 10, 2009

Northern Trust Rolls Out Carbon Footprint Data

Northern Trust will offer environmental emission analytics which it said will enable institutional investors and high-net-worth individuals to effectively measure the carbon footprint of their investments.

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A Northern Trust news release said the data will be available globally, but is being rolled out to European clients first. The environmental analytics are based on data from Trucost Plc, a U.K. firm, through the Style Research Portfolio Analyzer (SRPA).

“Increasingly, we are seeing investors turn their attention towards measures that attempt to accurately attribute environmental impact as an extension to established performance and risk analytics,” said Peter Holman, head of client servicing for institutional investors in EMEA, at Northern Trust, in the news release. “But the ability to accurately assess the carbon footprint of a portfolio is largely constrained by the lack of consistent or comprehensive environmental data disclosed by companies.”

According to the news release, Northern Trust also has more than $9 billion in socially screened assets under management, including index options such as the Northern Global Sustainability Index Fund.

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