This downside management toolkit keeps you informed of the latest market events; shares how we have been managing downside risk in our portfolios; and equips you with important truths to hold on to while markets bounce through turbulent times.
Insights for times of market uncertainty
How we manage risk
How Russell Investments manages downside risk
At Russell Investments, we help investors manage downside risk in 3 ways: by diversifying sources of returns, using a robust dynamic asset allocation process to guide tactical positioning, and seeking effective implementation capabilities. We have been anticipating a low-return, high-volatility environment for the last 2-3 years. Accordingly, we have been dynamically adjusting our portfolio positioning to manage downside risk.
The search for returns: the low-return imperative
We believe the search for returns is not going to get any easier against a backdrop of high U.S. equity prices, narrow credit spreads and low bond yields. When expected future market returns are likely to be lower than the required rate of return, we believe an investor cannot afford to ignore any investment strategy that may offer incremental return, take on risks they do not expect to get paid for or disregard implementation efficiency.
Why downside protection may matter more than upside growth
The global macroeconomics and geopolitical outlook remains uncertain, suggesting that an environment of low rate, low growth, and high valuations may linger. Against this backdrop, preserving capital may be more important than seeking the growth of capital, because, in the investing world, losing less means requiring less to bounce back.
How we position our portfolios to help against downside risk
Complacency has no place in portfolio management. Once a portfolio or fund is built, it needs to be dynamically managed to not only take advantage of potential upside opportunities, but avoid as much downside as possible. At Russell Investments, our global portfolio managers direct multi-asset portfolios in real-time, all the time.
Important market volatility truths
Keep calm in volatile markets: Cycle of market emotions
The key to successful investing is to buy low and sell high. But more often than not, investors do the exact opposite. The reason? Investors are human. For example, many panic and cash out when markets fall. Ironically, at these times, these investors fail to recognise they are actually at the point of maximum financial opportunity.
How fragile are today’s financial markets?
The U.S. stock market continues to hit new highs. Interest rates remain remarkably low compared to historical norms. It’s almost 8 years since the last U.S. economic recession. But nothing lasts forever.
MARKET WEEK IN REVIEW
Weekly market update on global investment news in a quick five-minute video format featuring some of our top investment professionals.
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2018 Global Market Outlook
Russell Investments' comprehensive quarterly report setting out our strategists' views and analysis on global investment markets and economies.
Any opinion expressed is that of Russell Investment, is not a statement of fact, is subject to change and does not constitute investment advice.
The value of investments and the income from them can fall as well as rise and is not guaranteed. You may not get back the amount originally invested.