The Russell futures product suite at the NYBOT will feature a Value and a Growth companion component for seven Russell equity indexes, which are unique investment/risk management vehicles in the futures industry.
The product rollout will begin in the coming weeks with the start of futures on the Russell 1000 Value (Symbol VV) and the Russell 1000 Growth (Symbol GG). The NYFE currently trades the Russell 1000 (Symbol R) futures and options contracts. The new futures contracts will be cash settled and have a contract size of 500 times the index.
The addition of a Growth and Value choice for each index recognizes that the Value/Growth distinction has gained acceptance as a fundamental element of equity investment strategies, and that a focus on "style" has become one of the most dominant features of the investment landscape. While the source of the differences in returns of the Growth and Value portfolios is the subject of economists' debate, the differences over a given time period can be significant. For example, from 12/31/97 through 3/31/00, the Russell 1000 Growth Index outperformed the Russell 1000 Value Index by roughly 70 percentage points (98% vs. 25%). During the period from 3/00 to 3/03, the Russell 1000 Value outperformed the Russell 1000 Growth by almost 40 percentage points (-19% vs. -60%).
According to Charles H. Falk, Chairman of NYBOT, "As the world already knows, Russell is widely respected as an index provider that offers only the highest quality product. It is our pleasure to continue to partner with the Russell organization in offering these new index products."
"Managing the volatility of the Growth/Value cycle can be one of the most important challenges for investors in the equity markets," said Joseph J. O'Neill, Senior Executive Vice President at NYBOT. "Our futures and options contracts based on the Russell indexes and their "style" components give investors unique opportunities to use these indexes as risk management tools and trading vehicles. I encourage all the money managers and other investors worldwide who are familiar with the Russell indexes to investigate the new investment opportunities that the Russell index products at NYBOT offer."
The addition of the Russell "style" indexes opens new investment avenues for professional money managers who benchmark to the highly regarded Russell family of Indexes. Created in 1984, Russell's U.S. indexes provide an objective measurement of the U.S. equities market.
Trading hours for the Russell products on the NYFE subsidiary are Monday through Friday from 9:30 am until 4:15 pm (NY Time).
Frank Russell Company, a global leader in multi-manager investment services, provides investment products and services in more than 35 countries. Russell manages $67 billion in assets and advises clients worldwide representing $1.6 trillion. Founded in 1936, Russell is a subsidiary of Northwestern Mutual and is headquartered in Tacoma, WA, with additional offices in New York, Toronto, London, Paris, Singapore, Sydney, Auckland and Tokyo. For more information, go to www.russell.com.
The New York Board of Trade (NYBOT) is the parent company of the Coffee, Sugar and Cocoa Exchange, Inc. (CSCE) and the New York Cotton Exchange (NYCE). Through its two exchanges and their subsidiaries and divisions, NYBOT offers an expanding range of agricultural, currency and index products. Information about the New York Board of Trade can be found at www.nybot.com and www.nybotlive.com.
