Russell Survey: Managers Return to Risk

Investment Managers Move `From Defense to Offense` but Still Expect Credit
Market Recovery to Take Six to 12 More Months

TACOMA, Wash.--(Business Wire)--
The riskiest equity category - emerging markets - and the riskiest fixed income
category - high yield bonds - were the asset classes that managers were most
bullish about in the latest Investment Manager Outlook, a quarterly survey of
investment managers conducted by Russell Investments. Seventy-four (74) percent
of managers surveyed were bullish on emerging market equities, and 66 percent
were bullish on high-yield bonds. Managers turned to high yield and corporate
bonds as well as equities of nearly every style and sector.

At the same time, managers expressed a resoundingly negative sentiment for
investment strategies that represent maneuvers that are traditionally considered
to be defensive. Manager bullishness for cash and U.S. Treasuries fell to ten
and nine percent respectively. The manager optimism for cash is at an all-time
survey low while the figure for Treasuries is at a four-year survey low.
Similarly, manager bullishness for the health care and consumer staples sectors
fell to 44 percent and 32 percent respectively. Manager optimism for health care
is at an all-time survey low while the figure for consumer staples is at a
three-year survey low.

"Managers are indicating a much higher level of comfort with risk and appear to
be making a rotation from defense to offense," said Mark Eibel, director, Client
Investment Strategies. "To keep it simple, `anything but cash and Treasuries`
appears to be the rule for managers right now."

In the March 2009 IMO, managers indicated that they were relying on an improving
credit situation as the chief indicator of recovery in the financial markets,
and managers who responded to the current survey demonstrated their belief that
a credit market recovery was still some time away. Sixty-seven (67) percent of
managers responded that they thought it would take either six months or one year
for the credit markets to cease their hindrance of a market recovery.

"There is a healthy sense of wait-and-see balancing out the managers` embrace of
risk and their bullishness for equities nearly across the board," said Eibel.
"Taken together, the manager response seems to say that a recovery is probably
underway but the ride is still going to be a bumpy one."

Russell`s Investment Manager Outlookis intended to generate a meaningful
snapshot of investment manager sentiment each quarter. For the current
installment of the survey, Russell collected the opinions of senior-level
investment decision-makers at U.S. large and small cap equity investment
managers, as well as U.S. fixed-income investment managers. About 300 managers
participated in this survey.

Additional findings from the Investment Manager Outlook include:

Managers appear to believe that an economic recovery could follow the current
market recovery

At this date, the equity markets have recaptured some of the losses experienced
during the year. The results of the IMO show managers now appear to be
expressing a belief that an economic recovery could also be in the works.
Bullishness for the materials and processing sector nearly doubled, rising from
33 percent last quarter to 60 percent. The energy sectors also took substantial
jumps in manager bullishness. Other energy rose from 51 percent last quarter to
70 percent, and integrated oils rose from 42 percent to 61 percent.

"Although a lasting economic recovery is far from certain, the managers who
responded to the Russell survey appear to be pointing in that direction," said
Eibel. "The growing enthusiasm for the materials and processing sector reflects
a belief that the gears of the economy may be starting to turn. Their optimism
for the energy sectors points to the managers expecting another byproduct of a
recovering economy - higher and longer-term demand for energy - that may be
near."

Managers set new high-water marks for bullishness across a range of asset
classes and sectors

Six of 13 asset classes and eight of 12 sectors reached either a new high in
manager bullishness for the IMO survey or the second highest-ever result. The
asset classes and sector recording new all-time highs were:

* High yield bonds (66 percent bullishness, up five percentage points from March
2009);
* Emerging market equities (74 percent bullishness, up 33 percentage points from
March 2009);
* Small cap growth (57 percent bullishness, up seven percentage points from
March 2009);
* Other energy (70 percent bullishness, up 19 percentage points from March
2009);
* Integrated oils (61 percent bullishness, up 19 percentage points from March
2009); and
* Autos and transportation (26 percent bullishness, up 12 percentage points from
March 2009).

"Although it primarily speaks to the larger story of the return to risk, the
manager bullishness for emerging market equities is partially due to a
resurgence in commodities prices, a weaker dollar and partially because China`s
fiscal recovery efforts are working," said Eibel.

About Investment Manager Outlook

Prior to the end of each quarter, Russell polls a sample of investment managers
to collect top-line opinions about their outlook for the direction of the
markets, sectors and asset classes to watch, and trends on the horizon that
could impact investment strategy. In addition to the quantitative results, the
Investment Manager Outlook provides qualitative analysis and commentary from one
of Russell`s senior investment strategists. Detailed results and analysis from
the Investment Manager Outlook are available on www.russell.com/IMO. For Index
data, please visit www.russell.com.

About Russell

Russell Investments is a global investment company with $136 billion in assets
under management as of March 31, 2009. Russell serves individual, institutional
and advisor clients in more than 40 countries and provides investment solutions
including mutual funds, retirement investments, institutional asset management,
implementation services and global stock market indexes. Russell is
world-renowned for its depth of manager research, quality of manager selection
and access to some of the world's leading investment managers. It helps
investors of all sizes put this access to work in corporate defined benefit and
defined contribution plans, and in the life savings of individual investors.

Founded in 1936, Russell is a subsidiary of Northwestern Mutual Life Insurance
Company. Headquartered in Tacoma, Russell operates principal offices in
Amsterdam, Auckland, Johannesburg, London, Melbourne, New York, Paris, San
Francisco, Seoul, Singapore, Sydney, Tokyo and Toronto.

IMPORTANT NOTES

Russell Investment Group, a Washington, USA corporation, operates through
subsidiaries worldwide including Russell Investments. Russell Investment Group
is a subsidiary of The Northwestern Mutual Life Insurance Company.

Russell Investments is the owner of the trademarks, service marks and copyrights
related to its indexes.

Russell Financial Services, Inc., member FINRA, part of Russell Investments.

Russell Investments
Jennifer Tice, 253-439-1858
jtice@russell.com
or
Matt Burkhard, 718-875-2122
mburkhard@neibartgroup.com
or
www.russell.com

Copyright Business Wire 2009