An analysis of Russell Emerging Markets Index performance over the five years ended July 23rd shows defensive stocks significantly outperformed their dynamic counterparts in emerging markets. The Russell Emerging Markets Defensive Index outperformed the Russell Emerging Markets Index and its Dynamic counterpart for 2013 year-to-date, one year, three year and five years as of July 23rd.
"The Russell Stability Indexes offer multi-asset investors an alternative way to measure and tap into emerging markets by providing insight into whether investors are favoring higher quality, more stable (i.e., Defensive) stocks, or are increasing their risk appetite and favoring more economically sensitive, less stable (i.e., Dynamic) stocks," said David Koenig, CFA, FRM, investment strategist with Russell Indexes. "These index tools can be particularly useful when investing in emerging markets, which can be more volatile than other global markets. The outperformance of defensive-oriented stocks in these markets over the longer term as illustrated by the Russell Indexes suggests that a focus on higher quality holdings may be beneficial for long-term investors."
Russell Indexes Performance
INDEX | 2013 YTD AS OF JULY 23RD | ONE YEAR AS OF JULY 23RD | 3 YEARS AS OF JULY 23RD(ANNUALIZED) | 5 YEARS AS OF JULY 23RD(ANNUALIZED) |
---|---|---|---|---|
Russell Emerging Markets Index | -4.9% | 2.0% | 2.2% | 5.6% |
Russell Emerging Markets Defensive Index | -2.9% | 3.1% | 7.7% | 11.2% |
Russell Emerging Markets Dynamic Index | -6.3% | 1.3% | -1.5% | 2.4% |
Source: Russell Investments. Returns are euro-denominated.