Tim Furlan

Russell Investments, a leading global investment solutions partner committed to improving peoples’ financial security, released its seventh annual Value of an Adviser Report.

The report reveals financial advisers added at least 5.7% in value for clients over the past year by providing counsel across the full breadth of their affairs – from investing to tax planning, social security and estate planning.

More than half of this benefit was derived from advisers’ ability to help people avoid kneejerk decisions amid market volatility and economic uncertainty. This included encouraging clients to remain disciplined and reweight portfolios as global share markets reached record highs – despite the temptation to chase more gains.​

“Advisers are much more than financial experts – they are also behavioural coaches who help clients cope with the emotional rollercoaster of both investing and life itself,” said Neil Rogan, Russell Investments’ Managing Director, Head of Distribution in Australia and New Zealand.

Russell Investments’ Value of an Adviser equation is calculated by adding together the estimated benefit of an adviser’s guidance on asset allocation (1.1%), behavioural coaching (3.3%) and tax planning (1.3%).

“Advisers’ practical support also helped clients maintain strategies like dollar cost averaging as rising inflation cut their disposable income,” Mr Rogan said.

The report also highlights common challenges that advisers and their clients face in 2024.

These include:

• the financial burden faced by single retirees with insufficient capital to support themselves
• increased demands on grandparents to pay school fees or help with housing costs
• the risk of inadvertently breaching tax regulations and incurring penalties
• a cost-of-living crisis that stymies the efforts of younger generations to pay off HECS and purchase property.

“This year’s findings highlight the real role advisers play in securing the future of their clients. It is a role closely aligned to Russell Investments’ own purpose of providing investment solutions that help more people retire with dignity,” said Tim Furlan, Russell Investments’ Managing Director, Australia and New Zealand.

“It’s important advisers continue to communicate their value to clients. This report shows that if an adviser can help clients avoid common behavioural mistakes, they likely provide value above and beyond their fees,” Mr Rogan concluded.

Read the report.

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Portrait and Headshot Photographer

Russell Investments’ GoalTracker® MySuper option delivered an impressive return of 12.3% for its accumulation members aged 50 and under for the 2024 financial year.​

The headline result reflects strong performance for all members in Russell Investments’ GoalTracker MySuper option, with members seeing returns ranging from 9.2% to 12.3% (depending on their age) for the financial year to 30 June 2024.

Since its inception in March 2020, the GoalTracker MySuper option has delivered average annualised returns of between 8.3% and 11.3% across age bands.

“Our strong investment performance is helping to grow the super savings for more than 80,000 working Australians across the country. It also reinforces the commitment of the fund to manage investments through members’ life stages, giving them the best chance at a great life after work,” said Tim Furlan, Head of Australia and New Zealand at Russell Investments.

The GoalTracker option invests members’ super based on their age, through a diversified portfolio invested across a range of asset classes.

For younger members, the focus is on growth over the longer-term, allocating their portfolio to a high proportion of growth assets. This focus changes over time as members near retirement age, with the proportion of defensive assets increasing to manage risk.

“The two biggest factors that can limit members’ super savings is not taking on enough investment risk while they’re younger and then conversely not adequately derisking as they approach retirement. Our default GoalTracker option addresses those factors by investing based on the members’ age. They also have the option to get an even more personalised strategy by adding further details like their super balance, income, expected retirement age and income goal, and more.” Furlan said.

Daniel Choo, Senior Portfolio Manager at Russell Investments, said that “The aim of the GoalTracker option is to take acceptable levels of risk when appropriate through the asset allocations we set for members. We actively manage our actual exposures relative to those asset allocations, based on the outlook for both growth and defensive assets.”

“Despite a risk of recession, our strategy was to stick to our strategic asset allocations, and this paid off as markets continued to rise over the year. This decision was based on our Cycle, Valuation and Sentiment investment process.

“This year’s performance reflects the importance of balancing investment opportunities when markets are fearful and knowing when to dial down as markets become overexuberant. We continue to focus on achieving the best possible return for our members to reach their personal goals and financial security in retirement.”

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Tim Furlan

Global investment manager and solutions provider Russell Investments has today launched its first multi-strategy exchange-traded fund (ETF) in Australia, providing investors with access to an actively managed portfolio of international shares, with a focus on environmental, social and governance (ESG) related considerations.

Russell Investments Sustainable Global Opportunities Complex ETF (ASX:RGOS) incorporates the investment strategies of multiple global equities managers Russell Investments considers have ESG capabilities in global shares. RGOS takes ESG related considerations into account by selecting managers who have been identified by Russell Investments as having a sustainable investment strategy, and by applying exclusionary screens and net zero transition considerations.

Tim Furlan, Managing Director Australia and New Zealand at Russell Investments, said the appetite for actively managed ETFs continues to strengthen in Australia and, at the same time, investors seek investment solutions focused on the environment and sustainability.​

“RGOS gives investors access to quality investment ideas from multiple managers.  In selecting these managers, we assess how the manager integrates ESG characteristics or objectives in its processes,” Furlan said.

Russell Investments’ Head of Global Equities Will Pearce and Senior Portfolio Manager James Harwood will lead the management of RGOS’s investment portfolio. Harwood said RGOS provides institutional-grade risk control, active selection and outperformance potential which can be considered as part of a core international shares allocation in a balanced portfolio.​

“For ESG-focused investors it is a balance between deliberate security selection in line with their values, while not being constrained by the opportunity set or bearing excessive risk. Our multi-strategy approach provides a diversified exposure to sustainable global shares with lower equity factor and stock risks, compared to a typical single manager active ESG-related strategy,” said Harwood.

“Individual active ESG managers can lean towards investment styles such as growth or quality, and either large or small cap. RGOS uses complementary managers to balance these factors to provide less volatile performance patterns, while still pursuing excess returns above RGOS’ global equity benchmark.”

Russell Investments’ dedicated manager research team evaluate more than 200 global equity managers who we consider have ESG capabilities for possible inclusion in the portfolio.

Russell Investments’ portfolio managers continually assess the managers and their suitability for the portfolio, with additions or replacements made as necessary, or as new opportunities are uncovered. This may include managers that are otherwise closed to new money or not immediately available to Australian investors.

The current managers include: Sparinvest, Wellington Management, Neuberger Berman, and Mirova, allowing Russell Investments to combine a mix of investment styles focussing on value, quality and growth.

RGOS will also disclose its full holdings daily, giving investors transparency about how their money is being invested.

RGOS aims to outperform its benchmark, the MSCI All Country World Net Index, before costs and tax, with a fee of 0.95% per annum on assets under management.

RGOS becomes the sixth product in Russell Investments’ suite of ETFs in Australia. Other Russell Investments’ products include three fixed income ETFs (RGB, RCB, RSM), and two Australian share ETFs (RDV, RARI).

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Bronwyn Yates

Russell Investments has announced a series of appointments to support the global investment solutions firm’s next phase of growth across the Asia Pacific (APAC) region.

Tim Furlan will lead as Managing Director for Australia and New Zealand. Tim has worked at Russell Investments for the past 19 years, holding senior positions across Russell Investments’ Master Trust and Superannuation businesses. Based in Sydney, Tim will continue to drive growth across Russell Investments’ local operations as demand for client-driven solutions increases across both institutional and retail sectors.

Long standing Russell Investments’ executive Pete Gunning continues to serve as Vice Chairman and resumes as Head of APAC. Pete has worked at Russell Investments for 27 years, including two stints as Global Chief Investment Officer in 2008-2013 and 2018-2021. He also formerly held the Head of APAC role for eight years up to October 2021.

Tim and Pete succeed former Russell Investments Head of Asia Pacific, Jodie Hampshire, who departed Russell Investments in October after a career spanning 17 years in Sydney and London.

“We thank Jodie for her enormous contributions over the years and I am honoured to work alongside Pete to drive innovation, with a focus on client investment outcomes. More than ever our clients need solutions that create and protect wealth in an increasingly complex environment. We’re delivering new initiatives in response to client needs and have innovative products in the pipeline for now and into 2024,” Tim said.

Bronwyn Yates is now Head of Go-to-Market (GTM) Strategy and Operations for APAC, which spans Australia, China, Japan, Korea and New Zealand. With more than 16 years’ experience at Russell Investments, Bronwyn is well positioned to lead the coordination and communication of strategy across all client segments and across the region. She has also been a director on the Russell Investment Management Board since 2013.

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GoalTracker is the default MySuper investment option for members of leading funds including Russell Investments’ iQ Super, Nationwide Super and Resource Super.

In the year to 30 June 2023, the GoalTracker investment option for members aged 50 and under earned a return of 13.5%, with members benefiting from the option’s higher allocation to growth assets. Since inception in March 2020, the option has delivered annual returns of 11% p.a.

​For younger members, the GoalTracker investment option is designed to focus on growth over the longer-term, exposing their portfolio to a high proportion of growth assets. This focus changes over time as members near retirement age, with the proportion of defensive assets increasing to manage risk.​

Members across all age-bands with the GoalTracker investment option achieved more than 9.9% in returns for the year to 30 June 2023, benefitting from access to the world’s leading investment managers and strategies in diversified, adaptive, and efficient portfolios aimed at achieving their goals.

Beyond investment performance

The GoalTracker program was designed to demystify super and help close the ‘real retirement gap’^[2]. Research has shown that many Australians see their super savings as a ‘black box’, leaving them with key unanswered questions as to their retirement readiness, such as: ‘How much do I need?’ ‘Am I on track?’ ‘What can be done to close the gap?

In response, the award-winning^[3] GoalTracker program’s philosophy is unique in that it has been shaped to answer these questions. Since launching in 2020, one in four members have actively engaged with GoalTracker’s online tools, taking actions such as building a personalised retirement income goal, understanding how they are tracking to that goal, and modelling strategies to close any gap.

Once an individual has set a goal, GoalTracker can do the hard work by implementing and reviewing their asset allocation quarterly and adjusting it on their behalf, if necessary, as their financial circumstances and markets change. That allows the strategy to be more focused on growth where it’s appropriate for an individual’s circumstances.

Tim Furlan, Russell Investments Head of Master Trust and Superannuation said: “GoalTracker’s performance demonstrates the immense value of having the right investment strategy, for each member, at the right time. The broader GoalTracker program also highlights the benefits of working closely with members to define their retirement goals and delivering support tools and services to help them achieve those goals.

“It also highlights the strength of Russell Investments’ investment capabilities. With more than $447 billion in assets under management across the globe, Russell Investments can offer Australians access to leading investment managers and strategies normally reserved for only the largest institutional investors.

“With a focus on growth assets for our younger members, in years when growth assets like global equities perform strongly, those members see a greater benefit as we’ve seen over the 2022/23 financial year.”

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Notes:
[1] GoalTracker Age Based 50 and below, https://russellinvestments.com/au/super-and-retirement/investments/performance/iq-super
[2] Making Super Personal Whitepaper, Russell Investments, 2020
[3] GoalTracker received the Best Fund: Innovation award at the 2020 Chant West Super Fund Awards; Global publication Pensions & Investments’ WorldPensionSummit awarded the Innovation Award in Technology Innovation to GoalTracker at its 2020 Innovation Awards; Money Management and Super Review, together with their research partner Heron Partnership, named GoalTracker the winner of the Best Member Engagement Innovation at the Super Review Super Fund of the Year Awards 2020.

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