Strategic Call Overwriting Fund
Focusing on fundamentals
Fund objective
The Fund seeks to provide total return with lower volatility than U.S. equity markets.
Overview
| Class | Ticker | CUSIP |
|---|---|---|
| S | ROWSX | 78249R776 |
Investment strategy
- The Fund invests principally in equity securities economically tied to the U.S., which primarily include common stocks of large and medium capitalization companies.
- The Fund also writes (sells) index call options, typically on broad-based securities market indexes. The combination of buying common stocks and selling call options is known as call overwriting.
- The Fund seeks investment results that exceed the total return of and closely correspond to the volatility of the CBOE S&P 500 BuyWrite Index (BXMSM) Index through a combination of returns on equity investments and premiums (cash received) from the sale of index call options.
- The Fund seeks gains from writing call options and from its equity portfolio and seeks income from dividends on stocks held.
Call overwriting portfolio
Under normal circumstances, the Fund continuously writes (sells) index call options, typically on broad–based securities market indexes. The Fund writes index call options within a predefined strike range (i.e., the price at which the call option can be exercised by the purchaser) which varies from slightly in–the–money to slightly to moderately out–of–the–money, meaning that option exercise prices may be either higher or lower than the current price level of the index at the time the options are written. The Fund typically writes index call options with weekly and monthly tenors (i.e., the amount of time left until expiration).
Growth of hypothetical $10,000 (since inception) - Class S
As of 12/31/2018
| 8/15/2012 12:00:00 AM | 10000 |
| 8/31/2012 12:00:00 AM | 10010 |
| 9/30/2012 12:00:00 AM | 10150 |
| 10/31/2012 12:00:00 AM | 10067.807 |
| 11/30/2012 12:00:00 AM | 9947.714 |
| 12/31/2012 12:00:00 AM | 10006.479 |
| 1/31/2013 12:00:00 AM | 10269.542 |
| 2/28/2013 12:00:00 AM | 10431.426 |
| 3/31/2013 12:00:00 AM | 10613.546 |
| 4/30/2013 12:00:00 AM | 10730.755 |
| 5/31/2013 12:00:00 AM | 10791.61 |
| 6/30/2013 12:00:00 AM | 10669.9 |
| 7/31/2013 12:00:00 AM | 10809.036 |
| 8/31/2013 12:00:00 AM | 10687.015 |
| 9/30/2013 12:00:00 AM | 10717.52 |
| 10/31/2013 12:00:00 AM | 10846.712 |
| 11/30/2013 12:00:00 AM | 11142.346 |
| 12/31/2013 12:00:00 AM | 11305.157 |
| 1/31/2014 12:00:00 AM | 11008.728 |
| 2/28/2014 12:00:00 AM | 11090.502 |
| 3/31/2014 12:00:00 AM | 11100.723 |
| 4/30/2014 12:00:00 AM | 11090.668 |
| 5/31/2014 12:00:00 AM | 11162.353 |
| 6/30/2014 12:00:00 AM | 11172.594 |
| 7/31/2014 12:00:00 AM | 11035.381 |
| 8/31/2014 12:00:00 AM | 11127.771 |
| 9/30/2014 12:00:00 AM | 11076.443 |
| 10/31/2014 12:00:00 AM | 11067.142 |
| 11/30/2014 12:00:00 AM | 11283.136 |
| 12/31/2014 12:00:00 AM | 11082.059 |
| 1/31/2015 12:00:00 AM | 10700.63 |
| 2/28/2015 12:00:00 AM | 11350.091 |
| 3/31/2015 12:00:00 AM | 11205.766 |
| 4/30/2015 12:00:00 AM | 11362.127 |
| 5/31/2015 12:00:00 AM | 11558.382 |
| 6/30/2015 12:00:00 AM | 11444.761 |
| 7/31/2015 12:00:00 AM | 11749.268 |
| 8/31/2015 12:00:00 AM | 11231.68 |
| 9/30/2015 12:00:00 AM | 11376.604 |
| 10/31/2015 12:00:00 AM | 11734.336 |
| 11/30/2015 12:00:00 AM | 11734.336 |
| 12/31/2015 12:00:00 AM | 11508.582 |
| 1/31/2016 12:00:00 AM | 10853.03 |
| 2/29/2016 12:00:00 AM | 10988.303 |
| 3/31/2016 12:00:00 AM | 11633.45 |
| 4/30/2016 12:00:00 AM | 11726.849 |
| 5/31/2016 12:00:00 AM | 11945.945 |
| 6/30/2016 12:00:00 AM | 11883.346 |
| 7/31/2016 12:00:00 AM | 12240.909 |
| 8/31/2016 12:00:00 AM | 12272.296 |
| 9/30/2016 12:00:00 AM | 12335.07 |
| 10/31/2016 12:00:00 AM | 12328.779 |
| 11/30/2016 12:00:00 AM | 12685.526 |
| 12/31/2016 12:00:00 AM | 12785.07 |
| 1/31/2017 12:00:00 AM | 12963.956 |
| 2/28/2017 12:00:00 AM | 13290.159 |
| 3/31/2017 12:00:00 AM | 13311.204 |
| 4/30/2017 12:00:00 AM | 13446.754 |
| 5/31/2017 12:00:00 AM | 13562.765 |
| 6/30/2017 12:00:00 AM | 13710.416 |
| 7/31/2017 12:00:00 AM | 13946.484 |
| 8/31/2017 12:00:00 AM | 13967.631 |
| 9/30/2017 12:00:00 AM | 14168.528 |
| 10/31/2017 12:00:00 AM | 14386.797 |
| 11/30/2017 12:00:00 AM | 14651.845 |
| 12/31/2017 12:00:00 AM | 14818.323 |
| 1/31/2018 12:00:00 AM | 14871.473 |
| 2/28/2018 12:00:00 AM | 14467.531 |
| 3/31/2018 12:00:00 AM | 14127.368 |
| 4/30/2018 12:00:00 AM | 14186.587 |
| 5/31/2018 12:00:00 AM | 14527.406 |
| 6/30/2018 12:00:00 AM | 14559.358 |
| 7/31/2018 12:00:00 AM | 15031.815 |
| 8/31/2018 12:00:00 AM | 15448.18 |
| 9/30/2018 12:00:00 AM | 15501.56 |
| 10/31/2018 12:00:00 AM | 14520.387 |
| 11/30/2018 12:00:00 AM | 14595.29 |
| 12/31/2018 12:00:00 AM | 13758.05 |
Historical distributions
| Ex-Date | Income Dividend | Capital Gains - Short Term | Capital Gains - Long Term |
|---|---|---|---|
| 04/03/2018 | 0.0254 | ||
| 07/03/2018 | 0.0325 | ||
| 10/02/2018 | 0.0331 | ||
| 12/19/2018 | 0.0375 |
S&P 500 Index is an index, with dividends reinvested, of 500 issues representative of leading companies in the U.S. large cap securities market.
CBOE S&P 500 BuyWrite Index (BXMSM) Index is a passive total return index based on (1) buying an S&P 500 stock index portfolio, and (2) "writing" (or selling) the near-term S&P 500 Index (SPXSM) "covered" call option, generally on the third Friday of each month. The SPX call written will have about one month remaining to expiration, with an exercise price just above the prevailing index level (i.e., slightly out of the money). The SPX call is held until expiration and cash settled, at which time a new one-month, near-the-money call is written.
Performance information is historical and does not guarantee future results. Investment return and principal value will fluctuate so that redeemed shares may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. Current to the most recent month-end performance for Russell Investment Company mutual funds is available by visiting: https://russellinvestments.com/us/funds/performance-prices
Holdings, sector weights, and quality ratings (where applicable) are share class agnostic.
Top 10 Holdings✝
As of 12/31/2018
Updated Monthly
| Company | Weight |
|---|---|
| Apple Inc. | 3.84% |
| Apple, Inc. | 3.84% |
| Microsoft Corp. | 3.59% |
| Amazon.com Inc. | 2.77% |
| Amazon.com, Inc. | 2.77% |
| JPMorgan Chase & Co. | 1.78% |
| Berkshire Hathaway, Inc. | 1.75% |
| Berkshire Hathaway Inc. Cl B | 1.75% |
| UnitedHealth Group Inc. | 1.63% |
| Johnson & Johnson | 1.58% |
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Sector weightings❄
As of 11/30/2018
Updated Monthly
| Sector | Weighting |
|---|---|
| Technology | 20.89% |
| Financial Services | 20.22% |
| Consumer Discretionary | 14.50% |
| Health Care | 13.89% |
| Producer Durables | 10.99% |
| Consumer Staples | 6.24% |
| Energy | 5.19% |
| Utilities | 5.12% |
| Materials and Processing | 2.92% |
| Finance | 0.04% |
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†The top ten holdings list excludes shares of the investment vehicles in which the Fund invests its cash. The % of Portfolio value is subject to change.
*Sector weight totals may exceed or fall below 100% due to rounding.
Fund objectives, risks, charges and expenses should be carefully considered before investing. A summary prospectus, if available, or a prospectus containing this and other important information can be obtained by calling 800-787-7354 or by visiting the prospectus and reports page to download one. Please read the prospectus carefully before investing.
Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns.
Diversification and multi-asset solutions do not assure a profit and do not protect against loss in declining markets.
Securities products and services offered through Russell Investments Financial Services, LLC, member FINRA, part of Russell Investments.
For information on the Financial Industry Regulatory Authority, go to www.finra.org.