july 25, 2013 fixed income update and outlook kris ullman, divisional director, eastern canada greg...

JULY 25, 2013

Fixed IncomeUpdate and Outlook

Kris Ullman, Divisional Director, Eastern Canada

Greg Nott, CFA, Chief Investment Officer

FOR ADVISOR USE ONLY. DISTRIBUTION OR DISCLOSURE TO INVESTORS OR POTENTIAL INVESTORS IS PROHIBITED

THIS PUBLICATION IS INTENDED FOR INVESTMENT ADVISORS ONLY AND IS NOT INTENDED FOR, NOR CAN IT BE PROVIDED TO, INVESTORS OR POENTIAL INVESTORS. IT DOES NOT CONSTITUTE A SALES COMMUNICATION AS DEFINED BY NATIONAL INSTRUM 81-102, “MUTUAL FUNDS.”

Nothing in this publication is intended to constitute legal, tax, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. This information is made available on an “as is” basis. Russell investments Canada Limited does not make any warranty or representation regarding the information.

Indices and benchmarks are unmanaged and cannot be invested in directly. Returns represent past performance, and are not a guarantee of future performance and are not indicative of any specific investment. Index return information is provided by vendors and although deemed reliable, is not guaranteed by Russell investments or its affiliates. Due to timing of information, indices may be adjusted after the publication of this report.

This publication may contain forward-looking statements. Forward-looking statements are statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "expects", "anticipates", "plans", "believes", "estimates" or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future Fund action, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risk, uncertainties and assumptions about economic factors. Forward-looking statements are not guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made in this publication. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors, interest and foreign exchange rates, capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. No model or group of models can offer a precise estimate of future returns available from capital markets.

Unless otherwise stated, all yield measures are yield-to-maturity. Yield-to-Maturity: The rate of return anticipated on a bond if it is held until the maturity date.

Unless otherwise stated all index data is sourced from © BNY Mellon Asset Servicing. All rights reserved.

This report contains Standard & Poor’s proprietary data and is provided for the recipient's internal use only.

p.2FOR ADVISOR USE ONLY. DISTRIBUTION OR DISCLOSURE TO

INVESTORS OR POTENTIAL INVESTORS IS PROHIBITED

Important information

Important informationDEX Indices: Source: PC-Bond, a business unit of TSX Inc. Copyright © TSX Inc. 2013. All rights reserved. The information contained herein may not be redistributed, sold or modified or used to create any derivative work without the prior written consent of TSX Inc.

THE USER AGREES THAT TSX INC. AND THE PARTIES FROM WHOM TSX INC. OBTAINS DATA DO NOT HAVE ANY LIABILITY FOR THE ACCURACY OR COMPLETENESS OF THE DATA PROVIDED OR FOR DELAYS, INTERRUPTIONS OR OMISSIONS THEREIN OR THE RESULTS TO BE OBTAINED THROUGH THE USE OF THIS DATA.THE USER FURTHER AGREES THAT NEITHER TSX INC. NOR THE PARTIES FROM WHOM IT OBTAINS DATA MAKE ANY REPRESENTATION, WARRANTY OR CONDITION, EITHER EXPRESS OR IMPLIED, AS TO THE RESULTS TO BE OBTAINED FROM THE USE OF THE DATA, OR AS TO THE MERCHANTABLE QUALITY OR FITNESS OF THE DATA FOR A PARTICULAR PURPOSE.

The MSCI information may only be used for your internal use, may not be reproduced or redisseminated in any form and may not be used to create any financial instruments or products or any indices. The MSCI information is provided on an “as is” basis and the user of this information assumes the entire risk of any use it may make or permit to be made of this information. Neither MSCI, any of its affiliates or any other person involved in or related to compiling, computing or creating the MSCI information (collectively, the “MSCI Parties”) makes any express or implied warranties or representations with respect to such information or the results to be obtained by the use thereof, and the MSCI Parties hereby expressly disclaim all warranties (including, without limitation, all warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential or any other damages (including, without limitation, lost profits) even if notified of, or if it might otherwise have anticipated, the possibility of such damages.

The Russell Investments Logo and Indices are a trademark or registered trademark of Frank Russell Company and are used under license by Russell Investments Canada Limited.

Russell Investments Canada Limited is a wholly owned subsidiary of Frank Russell Company and was established in 1985. Russell Investments Canada Limited and its affiliates, including Frank Russell Company, are collectively known as “Russell Investments.”

Copyright © Russell Investments Canada Limited 2013. All rights reserved. This material is proprietary and may not be reproduced, transferred, or distributed in any form without prior written permission from Russell Investments.

Date of publication: July 2013. RETAIL-2013-07-23-0591 (EXP-07-2014).



The investment world today

›Return assumptions are low, yet return requirements remain high

›Investors want more certainty than they can afford

›Increasing uncertainty with fixed income investments


p.4


Source: Investment Analyzer, as of April, 2013

Products Category Average Advisor Holdings

# of Products 438

# of Equity Products 261

# of Fixed Income (FI) Products 105

# of Mutual Funds 170

Key Ratios Average (CAN$)

AUM per Product $224,426

AUM per Equity Product $527,352

AUM per FI Product $760,566

p.5

Russell Disciplined Investing Program

43.7%

23.6%

6.9%

1.6%

24.0%

EqutiyFixed IncomeCashAlternativeBalanced

Source: Russell Disciplined Investing Program. Calculated as of April 2013.


p.6

Russell Disciplined Investing ProgramAverage advisor asset allocation

p.7

Examples of 2012 financial magazine covers


The “wall of worry” might not be that high in the end



What does the future hold?

Source: Financial Post, June 3, 2013

Part I

Fixed Income Review


p.9

Jan-1

2

Jan-1

2

Feb-1

2

Feb-1

2

Mar

-12

Mar

-12

Apr-12

Apr-12

May

-12

Jun-1

2

Jun-1

2

Jul-1

2

Jul-1

2

Aug-12

Aug-12

Sep-1

2

Sep-1

2

Oct-1

2

Nov-12

Nov-12

Dec-1

2

Dec-1

2

Jan-1

3

Jan-1

3

Feb-1

3

Mar

-13

Mar

-13

Apr-13

Apr-13

May

-13

May

-13

Jun-1

31

1.2

1.4

1.6

1.8

2

2.2

2.4

2.6

2.8 Bond Yields & Market Volatility

Canada 10 Yr - Yield US 10 Yr - Yield

Bo

nd

Yie

ld

p.10

Fed “tapering” comments spook

markets

Fed “tapering” comments spook

markets


Past performance is not indicative of future results.

“Taper” tantrum: Bond yields spike An overreaction to Fed comments

p.11

Recent GoC Yield Curves

Last 30 days

Significant spike in yields on mid-term Canadas

Less so in short and long end

Source: Bloomberg as of July 19, 2013Data is historical and is not indicative of future results.


GoC yield curve changes

Last 2 years

Short yields relatively unchanged

Longer term yields still well below 2011 levels

p.12

Source: Beutel Goodman, PC Bond. Yield data as of July 2nd, 2013, illustrating the difference in yield between DEX Long Corporate Index vs. DEX Long Canadas Index. Indexes are unmanaged and cannot be invested in directly. Data is historical and is not indicative of future results.


(%)

Long corporate yield spreads remain attractive


Source: FactSet, Russell Investments. Note: Data from 12/31/12 – 7/17/2013.Indexes are unmanaged and cannot be invested in directly. Data is historical and is not indicative of future results.

Option Adjusted Spread (OAS) Analysis

Canada & US Baa Indexes EMD & High Yield IndexesOAS (%)

OAS (%)

Credit spreads have widened as bond yields rose

This is not typical and we expect it to reverse

12/31/1

2

01/15/1

3

01/30/1

3

02/14/1

3

03/01/1

3

03/16/1

3

03/31/1

3

04/15/1

3

04/30/1

3

05/15/1

3

05/30/1

3

06/14/1

3

06/29/1

3

07/14/1

31.0

1.2

1.4

1.6

1.8

2.0

2.2

Barclays Capital US Baa Index Barclays Capital Canada Baa Index

12/31/1

2

01/15/1

3

01/30/1

3

02/14/1

3

03/01/1

3

03/16/1

3

03/31/1

3

04/15/1

3

04/30/1

3

05/15/1

3

05/30/1

3

06/14/1

3

06/29/1

3

07/14/1

32.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

6.0

Barclays Capital EM Bond Index BofA ML US HY Index

p.13

Credit spreads widened, but started to recover

p.14

Outlook:

› Significant increase in bond yields post-Fed comments appears to be an ‘over-reaction’ in our opinion

› We would expect bond yields to stabilize at levels lower than current

› But 10 year GoCs yields not likely to re-test the 2.0% level

› We believe rates unlikely to rise significantly from here:

› Given only slow global growth

› Given inflation staying low

› Given central banks will stay accommodative

› Bond Yields are expected to stay relatively ‘range bound’ for rest of 2013

› 2.10% - 2.40% on the 10-year

› Search for yield trade likely continues – credit spreads could narrow again

›We still expect modest positive single digit Total Returns for 2013

There is no guarantee that any stated expectations will occur and are subject to change based on economic conditions. Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specific investment.


Russell’s current fixed income outlook

p.15

Sub-adviser positioning commentsBeutel, Goodman & Company, Ltd.:

› Remain bearish on interest rates. Believe that the central banks will be successful in creating economic growth

› Still positive on long maturity liquid high quality corporates (utilities, pipelines)

Canso Investment Counsel Ltd:

› Still positive on credit but warning signs are increasing - Remain selective on new issuance

› Underweight to Cdn banks, large overweight to foreign financials (through Maples)

› Taking profits on longer maturity corps (Rogers, Bell, P3 issues) and re-investing in FRNs - now at 25% exposure.

Pacific Investment Mgmt. Company LLC:

› Expect weak economic growth to continue (below consensus forecast)

› Central banks stay ‘low for long’. Therefore neutral duration

› Given recent sell-off in credit markets – moving from a ‘risk reduction mode’ to ‘selectively adding risk’ – will add to non-domestic IG credit if spreads widen further

There is no guarantee that any stated expectations will occur and are subject to change based on economic conditions.Sub-advisers listed are current as of July 2013. Russell has the right to engage or terminate a sub-adviser at any time. The investment strategies are the goals of the individual sub-advisers there is no assurance that the exact objective will always be met.


Why be Active in fixed income?


p.16

› As yields have declined, and issuers having issued longer maturity debt, durations of benchmarks have increased significantly

› This increases the benchmark’s susceptibility to rate increases› As of January 2002, a 100bps increase in yields would result in an approx. index return of 0% over the

following 12 months for the DEX Universe Bond Index.

› As of January 2013, a 100bps increase in yields would result in an approx. index return of -4.5% over the following 12 months for the DEX Universe Bond Index.

p.17

Source: PC Bond Analytics, Debt Market IndicesThis is a hypothetical example and is not meant to represent any actual results. Indexes and/or benchmarks are unmanaged and cannot be invested in directly. Past performance is not indicative of future results.

Jan-

02

Jun-

02

Nov-0

2

Apr-0

3

Sep-0

3

Feb-0

4

Jul-0

4

Dec-0

4

May

-05

Oct-0

5

Mar

-06

Aug-0

6

Jan-

07

Jun-

07

Nov-0

7

Apr-0

8

Sep-0

8

Feb-0

9

Jul-0

9

Dec-0

9

May

-10

Oct-1

0

Mar

-11

Aug-1

1

Jan-

12

Jun-

12

Nov-1

22

2.5

3

3.5

4

4.5

5

5.5

6

6.5

7

0

1

2

3

4

5

6

7

8Dex Universe Bond Index

Yield Duration

Yie

ld (

%)

Du

ration

(years)


Benchmark risk has increased


› Duration Management

› Long duration vs. short duration (vs. the benchmark)

› Yield Curve Management

› Bullet vs. Barbell

› Sector Selection

› Governments vs. Corporates

› Skilled Security Selection

p.18

Flexibility of “active” management with fixed-income strategies

› Off-benchmark opportunities

› Non-domestic sovereign and corporates

› Securitized debt

› Floating Rate Notes

› Real Return Bonds

› High Yield/EMD (Hard/Local/Corp)

› Access to product

› Retail bond desks starved for inventory

› Better pricing

› Competitive retail pricing

p.19

Year 1 Impact based on yield and duration of RFIP* as of June 30, 2012: Yield: 2.85%, Duration: 5.88 years. Yr 1 yield change: Aggressive: +1.0%, Moderate: +0.70%, Conservative: +0.25%, *RFIP: Russell Fixed Income Pool Series FSource: Russell Investments. For illustrative purposes only and is meant to demonstrate the hypothetical effect on returns based on different yield scenarios. This is not a forecast of future results and not reflective of actual expectations.Indexes are unmanaged and cannot be invested in directly.

Year 1 Impact-4.0%

-3.0%

-2.0%

-1.0%

0.0%

1.0%

2.0%

-3.0

%

-1.3

%

1.4

%

1.5

%

Aggressive (+100bps)Moderate (+70bps)Conservative (+25ps)Actual RFIP 1 Yr as of 6/30/13 (Sr F)

Can 10 Yr Yield:6/29/12 = 1.74%6/28/13 = 2.44% 1Yr = +0.70%


Scenario Analysis of the Russell Fixed Income PoolSeries F as of June 30, 2012

Difference: +2.8%

Russell Fixed Income Pool positioning


p.20

p.21

Source: Wilshire Axiom, Russell Investments, Russell Fixed Income PoolData from Mar 31, 2008 to June 30, 2013. Data is historical and is not indicative of future results.

Yea

rs


Mar-08

May-08

Jul-0

8

Sep-08

Nov-08

Jan-0

9

Mar-09

May-09

Jul-0

9

Sep-09

Nov-09

Jan-1

0

Mar-10

May-10

Jul-1

0

Sep-10

Nov-10

Jan-1

1

Mar-11

May-11

Jul-1

1

Sep-11

Nov-11

Jan-1

2

Mar-12

May-12

Jul-1

2

Sep-12

Nov-12

Jan-1

3

Mar-13

May-13

-2.00

-1.50

-1.00

-0.50

0.00

0.50

1.00

Russell Fixed Income Pool Active Duration

Active Duration

Fixed Income Pool positioning over time

p.22

Fixed Income Pool sector positioning over time

Source: Wilshire Axiom, Russell Investments, Russell Fixed Income PoolData from March 31, 2008 to June 30, 2013. Data is historical and is not indicative of future results.


Rat

io:

Ove

rwei

ght/

Und

erw

eigh

t

Mar

-08

May

-08

Jul-0

8

Sep-0

8

Nov-0

8

Jan-

09

Mar

-09

May

-09

Jul-0

9

Sep-0

9

Nov-0

9

Jan-

10

Mar

-10

May

-10

Jul-1

0

Sep-1

0

Nov-1

0

Jan-

11

Mar

-11

May

-11

Jul-1

1

Sep-1

1

Nov-1

1

Jan-

12

Mar

-12

May

-12

Jul-1

2

Sep-1

2

Nov-1

2

Jan-

13

Mar

-13

May

-13

-25.00%

-20.00%

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00% Fixed Income Pool Sector Overweight/Underweight

Feds Provis&Munis Cdn Corps Total Foreign

p.23

Source: Wilshire Axiom, Russell Investments, Russell Fixed Income Pool. Data from March 31, 2008 to June 30, 2013. Data is historical and is not indicative of future results. Sub-advisers are current as of June 2013. Russell has the right to engage or terminate a sub-adviser at any time.


Dev

iatio

n fr

om

Str

ateg

ic W

eigh

ting

(%)

Mar

-08

May

-08

Jul-0

8

Sep-0

8

Nov-0

8

Jan-

09

Mar

-09

May

-09

Jul-0

9

Sep-0

9

Nov-0

9

Jan-

10

Mar

-10

May

-10

Jul-1

0

Sep-1

0

Nov-1

0

Jan-

11

Mar

-11

May

-11

Jul-1

1

Sep-1

1

Nov-1

1

Jan-

12

Mar

-12

May

-12

Jul-1

2

Sep-1

2

Nov-1

2

Jan-

13

Mar

-13

May

-13

-0.05

-0.04

-0.03

-0.02

-0.01

0.00

0.01

0.02

0.03

0.04

0.05 Fixed Income Pool deviations from strategic weighting

Beutel Canso PIMCo

Fixed Income Pool sub-adviser positioning over time

Other Fixed Income Pool Exposures

› We are increasing our exposure to FRNs

p.24

Short Term Income Pool

Fixed Income Pool

Current FRN Exposure

20.4% 13.6%

Real Return Bonds (RRBs)

› We are very gradually increasing our exposure to RRBs

Fixed Income Pool

Current RRB Exposure

2.2%

Data as of June 30th, 2013. Source: Wilshire Axiom.


Floating Rate Notes (FRNs)

Part II

Reviewing your Multi-Asset strategy:Russell in Action


p.25

p.27

10%

27%

26%

5%

7%

5%

6%

5%

5%2% 2% Short Term Income Pool

Fixed Income Fund

Core Plus Fixed Income Pool

Global High Income Bond Pool

Canadian Dividend Pool

Focused Canadian Equity Pool

Focused US Equity Pool

Overseas Equity Fund

Global Equity Fund

Global Infrastructure Pool

Global Real Estate Pool


Source: Russell Investments as of July 2013

Russell Income Essentials Portfolio68% Fixed Income / 32% Equities Target Allocation

2009 JUN

AUG

MAR

FEB

MAR

2010

hedged USD exposure

began incorporating asset class tilts into the portfolios

2011 removed USD hedge

US Equity: restructured from 11 sub-advisers to 6

DEC

APR

MAY

DEC

US Equity: +Mar Vista, Investment Partners, LLC -Montag & Caldwell

AUG

added strategic Short Term Income exposure

Added strategic Focused Canadian Equity and Focused US Equity exposures

2012

p.28

Sub-advisers are current as of the specified date. Russell has the right to engage or terminate a sub-adviser at any time.

Strategic allocation enhancements

Other enhancements

Global Equity: +Sustainable, -Marsico Capital Management

Added strategic Global High Income Bond exposure

Global Equity: +Sanders Capital, LLC

added strategic Canadian Dividend exposure


Russell Income Essentials Portfolio evolution

p.29

MAR



MAY

JUL

Russell Income Essentials Portfolio evolutionStrategic allocation enhancements

Other enhancements2013

Global High Income Bond Pool: +Lazard Asset Management (Canada), Inc.

added strategic Infrastructure and Real Estate exposures

JAN

Global Equity Pool: +Numeric Investors LLC, +Wellington Management Company, LLP-Arrowstreet Capital L.P. - McKinley Capital Management

Canadian Dividend Pool: +Invesco Canada Ltd.


-20.00

-10.00

0.00

10.00

20.00

30.00

40.00

25.87

24.65

Russell Income Essentials Portfolio, Series F Russell 35/65 Composite, Series F

p.30

RIEP Actual vs. Russell 36/65 Composite*

Cu

mu

lativ

e R

etu

rn (

%)

RIEP (Actual) RIEP Composite RelativeAnnualized Return 4.48 4.29 0.19Return/Risk 0.72 0.69


Source: Russell Investments, ConfluencePast performance is not indicative of future results.*The Russell 35/65 Composite, Series F represents the actual allocation of RIEP in 2008. Allocation is 33% Fixed Income Pool, 32% Core Plus Pool, 12% Canadian Equity Pool, 7% US Equity Pool, 8% Overseas Equity Pool, and 8% Global Equity Pool. Portfolio weights rebalanced back to target quarterly. The cumulative returns were calculated by taking a percentage of each of the pool’s return, net of Series F management fees and expenses.

Russell 35/65 Composite

Russell Income Essentials Portfolio evolution

p.31

20 %

18%

5%

19%

3%

10%

9%

7%

3%3% 3%

Chart Title Fixed Income Pool

Core Plus Fixed Income Pool

Global High Income Pool

Canadian Equity Pool

Smaller Companies Pool

US Equity Pool

Overseas Equity Pool

Global Equity Pool

Emerging Markets Equity Pool

Global Infrastructure Pool

Global Real Estate Pool


Source: Russell Investments as of July 2013

Russell Diversified Monthly Income43% Fixed Income / 57% Equities Target Allocation

2009 JUN

MAR

FEB

MAR

APR

2010

EM Equity: restructured, added strategic EM Equity and Frontiers exposure

2011 removed USD hedge

DECAdded strategic Global High Income Bond exposure

hedged USD exposure

began incorporating asset class tilts into the portfolios

NOVadded strategic Smaller Companies exposure

US Equity: restructured from 11 sub-advisers to 6

JAN

DEC

APR

MAY

2012



Other enhancements

Global Equity: +Sanders Capital, LLC

Cdn Equity: +Clarivest Asset Management LLC, - Greystone Management Investments Inc.

US Equity: +Mar Vista Investment Partners, L.P., -Montag & CaldwellGlobal Equity: +Sustainable, -Marsico Capital ManagementCdn Equity: +QV Investors Inc.,

- GCIC Ltd.


p.32

Russell Diversified Monthly Income Portfolio evolution

p.33

MAR

JANadded strategic Infrastructure and Real Estate exposures Global High Income Bond:

+Lazard Asset Management (Canada), Inc.

MAY

Global Equity Pool: +Numeric Investors, +Wellington Management,-Arrowstreet Capital, - McKinley Capital

JUNUS Equity Pool: +Fiduciary Management, -First Eagle, -PENN Capital





Other enhancements2013


-30.00

-20.00

-10.00

0.00

10.00

20.00

30.0021.77

19.65

Russell Diversified Monthly Income Portfolio, Series F-5 Russell 60/40 Composite, Series F

p.34

RDMIP Actual vs. Russell 60/40 Composite*

Cu

mu

lati

ve

Re

turn

(%

)

RDMIP (Actual) RDMIP Composite RelativeAnnualized Return 3.82 3.48 0.35Return/Risk 0.40 0.38


Source: Russell Investments, BNYMellon Workbench

Past performance is not indicative of future results.

*The Russell 60/40 Composite, Series F represents the actual allocation of RDMIP in 2008. Allocation is 20% Fixed Income Pool, 20% Core Plus Pool, 20% Canadian Equity Pool, 13.33% US Equity Pool, 13.33% Overseas Equity Pool, and 13.33% Global Equity Pool. Portfolio weights rebalanced back to target quarterly.

The cumulative returns were calculated by taking a percentage of each of the pool’s return, net of Series F management fees and expenses.

Russell 60/40 Composite

p.35

› We believe bond yields will stabilize around current levels for remainder of 2013› But Fixed Income total returns will remain low

› Therefore, at the Total Portfolio level, moderate to conservative investors will need to embrace more “growth” than times past, realizing that this will also increase risk

› Growth, however, does not necessarily equate to equity› Diversify sources of risk

› Growth exposure via fixed income = High Yield & EMD

› Growth exposure via non-traditional = GRE, GI, Commodities, Frontiers Mkt

› GOAL: Enhance total portfolio experience via improved risk-adjusted returns

› Consider actively-managed, globally diversified multi-asset strategiesp.35


Takeaways

www.russell.com“Russell,” “Russell Investments,” “Russell 1000,” “Russell 2000,” and “Russell 3000” are registered trademarks of the Frank Russell Company.

Q & A

Russell’s Fixed Income Line Up


p.37

PIMCoAllianceBernstein Canada, Inc. Goldman Sachs Asset Management, L.P.

Russell Fixed Income Line-up

*® Registered trademarks of Royal Bank of Canada. Used under license.As you move from left to right on the graph - increasing risk - there are different portfolios that can offer higher return potential, which is also matched by higher loss potential. As with any type of portfolio structuring, attempting to increase return or reduce risk can result in unintentional reduction of returns. See the prospectus section "Who should invest in this fund?" for more information.“ Sub-advisers are current as of April 2013. Russell has the right to engage or terminate a sub-adviser at any time.

HIGHERLOWER

HIGHER

RISK

PO

TE

NT

IAL

RE

TU

RN

RUSSELL SHORT TERM INCOME POOL

RUSSELL FIXED INCOME POOL

RUSSELL CORE PLUS FIXED INCOME POOL

RUSSELL GLOBAL HIGH INCOME BOND POOL

RUSSELL LIFEPOINTS FIXED INCOME PORTFOLIO

38

Russell Short Term Income PoolRussell Canadian Fixed Income FundRussell Core Plus Fixed Income PoolRussell Global High Income Bond Pool

DDJ Capital Management, LLCLogan Circle Partners, LLCLazard Asset Management (Canada), Inc.Stone Harbor Investment Partners LP

Beutel, Goodman & Company Ltd. Canso Investment Counsel Ltd. PIMCo

Phillips, Hager & North® AEGON Capital Management Inc. Canso Investment Counsel Ltd.

p.38

RUSSELL LIFEPOINTS CONSERVATIVE INCOME PORTFOLIO


www.russell.com“Russell,” “Russell Investments,” “Russell 1000,” “Russell 2000,” and “Russell 3000” are registered trademarks of the Frank Russell Company.

Thank you

july 25, 2013 fixed income update and outlook kris ullman, divisional director, eastern canada greg...

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