| Assets
Flood into Russell-Indexed Funds
By IndexFunds.com Staff
March 27, 2002 |
|
It may be a stock picker's market, but staid index funds have
been attracting their fair share of mutual fund assets.
The Frank Russell Company reported that cash has been pouring
into funds pegged to its equity benchmarks in the past two years.
Assets in index funds hitched to the firm's 21 benchmarks roared
to a record $214 billion in 2001, an increase of 85% over the
past two years in the face of a bear market.
| Profiting from an investment
revolution |
| Year |
Total assets in Russell
index funds |
| 1999 |
$116 billion |
| 2000 |
$176 billion |
| 2001 |
$214 billion |
Source: Frank Russell
Co.
The broad Russell
3000 in particular has stepped into the limelight - $95 billion
currently resides in passive funds tied to the benchmark that
covers 98% of the U.S. market.
"Investors who use Russell's indexes as benchmarks are increasingly
using financial instruments based on them to implement their investment
strategies," said Russell's Kelly Haughton, a strategist
who helped design the indexes.
Other Russell benchmarks that have attracted considerable assets
as of late include the Russell
1000 and Russell
1000 Value indexes, which measure large-cap companies. Currently,
$39 billion is invested in passive funds based on the Russell
1000, while Russell 1000 Value index funds have racked up $31
billion, according to Russell.
San Francisco-based indexing leviathan Barclays Global Investors
said assets under management in its passive funds tied to Russell
indexes have nearly doubled in the past two years - from $34.6
billion to $67.8 billion. BGI has a history of managing funds
for institutional clients but has made a foray into the retail
market, launching 12 iShares exchange-traded funds based on Russell
indexes. BGI spokeswoman Christine Hudacko noted that the iShares
Russell 3000 and iShares Russell 2000 are among the top 10 ETFs
by assets.
| Top 10 ETFs by Assets |
| Fund |
Assets ($ millions) |
| |
29,109.7 |
Nasdaq-100 Index Tracking
Stock ( QQQ) |
20,821.5 |
| |
5,440.0 |
| |
3,767.7 |
| |
3,097.9 |
iShares Russell 2000 ( IWM) |
2,257.0 |
Total Stock Market
VIPERs ( VTI) |
1,452.3 |
Technology Select Sector
SPDR ( XLK) |
1,345.4 |
iShares Russell 3000 ( IWV) |
1,303.0 |
| |
972.3 |
Source: Morningstar data as of 2/28/02
