customized portfolio solutions

Transition management

Managing portfolios in transition can maximize performance by reducing unnecessary cost and risk.

Organizations invest tremendous efforts in setting asset allocation policy, designing asset class structure, and researching and selecting investment managers.

However, even the most innovative investment ideas can fail to meet expectations if they are implemented poorly.

Our comprehensive transition management strategy and dedicated resources have the expertise to help you:

  • Minimize unnecessary costs
  • Mitigate unrewarded risk
  • Reduce administrative workload
  • Eliminate performance holidays and maintain accountability

Our suite of transition management services

Transition management

We have the experience and the expertise to help clients manage their risks and maintain the value of investments through periods of portfolio restructuring. With a dedicated portfolio manager, you get accountability and daily interaction as well as robust reporting including customized daily transition updates, post-transition reporting, transaction reporting and attribution coupled with all necessary regulatory and board reporting.

Interim portfolio management

As an interim portfolio manager, we can assume responsibility for the portfolio’s exposure and performance upon manager termination. Trading strategies and risk management techniques exercised throughout the assignment can significantly reduce the toll the transition might have on portfolio value. Just as importantly, we assume the workload from the asset owner, preventing vital resources in the organization from becoming overly burdened by non-core administrative tasks. As a result, the asset owner often receives active management with reduced risk without paying the active management fees.

Why Russell Investments for transition management?

Three important and key reasons

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Better performance outcomes through creative strategies and quality execution

We approach each event as a short-term asset management assignment, providing consultative insight to find optimal solutions for the unique attributes of each transition.

We source and access liquidity in an unbiased fashion through our multi-venue trading platform which provides breadth and depth of market access. Our strong performance track record across all asset classes demonstrates the value of our approach and process.

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Global transition management experience¹

In 2021, we managed 190 events and transitioned $130.2 billion.

Our global team includes 90+ implementation professionals including 20 who specialize in transition management².

Our proven transition track record is 75% of actual results³.

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Alignment of interests and fiduciary oversight

We work as an agent - never as a principal - which minimizes conflicts of interest.

As an asset manager, we maintain fiduciary oversight and provide a duty of care to investors as well as full transparency on all costs and changes.

An experienced, well-resourced global transition management team

$130.2b

Assets transitioned in 2021

20 professionals

Transition management specialists around the globe

40⁺ years

Experience transitioning assets for clients

20⁺ traders

All specializing by asset class and instrument

17 years

Transition manager average years of experience

The T Standard

In 2003, Russell Investments participated in the development of the T Standard which has since been adopted as the industry standard methodology for treatment of the critical factors that drive portfolio performance during a transition. The T Standard Implementation Shortfall is the arithmetic difference between the return on the legacy portfolio and the return on the new portfolio, performed on a daily basis. The T Standard measure of implementation shortfall (IS) was adopted by the T Charter as the recommended default calculation for IS.

Use of the T Standard helps captures the effects on portfolio performance from all transition activity. We believe that this consistency of reporting is critical for investors to be able to effectively compare providers and their cost estimates.

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A client-centric service model

With a dedicated portfolio manager to guide you through this complicated and risky period of change, you get accountability and daily interaction from your key point of contact.

Robust reporting and communication including customized daily transition updates, post-transition reporting, transaction reporting and attribution coupled with all necessary regulatory and board reporting.

A unique business model, client-centric approach and seasoned team results in more reliable performance and outcomes for your transition. Let us put together a clear, outcome-oriented plan for your next transition. Contact us today.

Highlighted research

A tale of two rebalances by Russell Investments

A tale of two rebalances: Time-tested implementation best practices during market stress

This paper explores the market dynamics during the first half of 2020 and how time-tested implementation best practices worked. We discuss two rebalancing approaches and apply these to a case study.

Institutional investor best practice by 2025 | Research by Russell Investments

Institutional investor best practice by 2025

This paper examines strategies investors can employ to improve their outcomes with modest changes in process–a clear focus on fee mitigation and transaction cost management.

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¹ Source: Russell Investments, As of December 31, 2020.

² As of September 30, 2021.

³ Past performance is not a guarantee of future results. Russell Investments Transition Management Performance Composites – 5-year composites ending December 2020.