Scott Fletcher, director of client investment strategies at Russell Investments Asia-Pacific, shares the key findings from the 20th edition of the annual Russell Investments/ASX Long-Term Investing Report - a performance comparison of various investments over 10, 20 and 25 years.

1. Planningforyourlong-term
financialobjectives
Presented by
Scott Fletcher
Director, Client Investment Strategies, Asia-Pacific
Russell Investments
19 July 2018

2. | netwealth3
This webinar and information has been prepared and issued by Netwealth Investments Limited (Netwealth), ABN 85 090
569 109, AFSL 230975. It contains factual information and general financial product advice only and has been prepared
without taking into account the objectives, financial situation or needs of any individual. The information provided is not
intended to be a substitute for professional financial product advice and you should determine its appropriateness having
regard to you or your client’s particular circumstances. The relevant disclosure document should be obtained from
Netwealth and considered before deciding whether to acquire, dispose of, or to continue to hold, an investment in any
Netwealth product.
While all care has been taken in the preparation of this document (using sources believed to be reliable and accurate), no
person, including Netwealth, or any other member of the Netwealth group of companies, accepts responsibility for any loss
suffered by any person arising from reliance on this information.
Disclaimer
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3. INSIGHT
2018 Russell Investments/ASX
Long Term Investing Report
Implications for Australian
investors
SCOTT FLETCHER
Director, Client Investment Strategies
Asia-Pacific

4. About Russell Investments
RUSSELL INVESTMENTS. FOR USE BY FINANCIAL PROFESSIONALS ONLY.
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$3.3
TRILLION
ASSETS UNDER
ADVICE*
300+DEDICATED
INVESTMENT
PROFESSIONALS*
$3.2
TRILLION
ASSETS
TRADED IN 2017*
47+YEARS
OF EXPERIENCE*
21OFFICES
GLOBALLY*
$389
BILLION
ASSETS UNDER
MANAGEMENT*
13,496
MANAGER PRODUCTS
CONTINUALLY MONITORED
AND RESEARCHED*
Awards & recognitionGlobal multi-asset solutions platform
GLOBAL HEADQUARTERS, SEATTLE USA
* Data as at 31 March 2018, AUD terms
Solutions
• Multi-asset
• Dynamic real return
• Global equities
• Global tax-effective equities
• Global multi-factor equities
• Global ESG
• Emerging & frontier equities
• Australian equities
• Australian tax-effective equities
• Australian multi-factor equities
• Australian ESG
• Emulation portfolios
• Global fixed income
• Absolute return fixed income
• Australian fixed income
• Cash strategies
• Liquid alternatives
• Private assets
• Overlay services
• Currency risk management
• Trading & execution services
• Transition management

5. Setting the scene
• Partnership between Russell Investments and
the Australian Stock Exchange (ASX)
• Annual snapshot of long term asset class
performance for Australian investors
• Asset class performance outcomes for last 10
and 20 years (pre and post-tax)
• Major liquid asset classes and Australian
residential property
• Derive insights into long term asset class
characteristics, and implications for designing
client portfolio solutions.
Participants & Purpose
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6. 1.
Why worry about the long term?
The past has information on how to design portfolios for the future
1. What is the portfolio’s purpose?
OUTCOME ORIENTATION
2. What is the right mix of asset
classes?
ASSET ALLOCATION PRINCIPLES
3. How do we account for current
market conditions?
CAPITAL MARKET INSIGHTS
(Market conditional assumptions)
4. Strategic portfolio designed to
achieve desired outcome:
STRATEGIC ASSET ALLOCATION
Key considerations for portfolio designInvestment process
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7. Key findings : Headlines
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8. Comparison with last year's gross returns: 10 years to December 2017 vs December 2016
Residential property, hedged global shares and bonds lead the way
Key findings : 10 years
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9. Comparison with last year’s gross returns: 20 years to December 2017 vs 2016
Residential property and Australian shares lead the way
Key findings : 20 years
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10. Property Equities Fixed Income Multi-asset
The journey matters as much as the destination
Key findings : Variability in returns
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11. The “Journey”: Details year on year
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12. Try to predict the next winner … but beware the ‘human factor’
Approach 1: The bumpy ride
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13. The high cost of investor behaviour
(1) BNY Mellon Analytical
Services, Russell 3000® Index
annualised return from January 1,
1984 to December 31, 2017.
(2) Russell Investments &
Investment Company Institute
(ICI). Return was calculated by
deriving the internal rate of return
(IRR) based on ICI monthly fund
flow data which was compared to
the rate of return if invested in the
Russell 3000® Index and held
without alteration from January 1,
1984 to December 31, 2017. This
seeks to illustrate how regularly
increasing or decreasing equity
exposure based on the current
market trends can sacrifice even
market like returns.
Indexes and/or benchmarks are
unmanaged and cannot be
invested in directly. Returns
represent past performance, are
not a guarantee of future
performance, and are not
indicative of any specific
investment.
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14. (eg. CPI + %)
Capturing sufficient upside
in ‘good times’
Greater downside limitation
in ‘bad times’
Diversified Growth return
pathway (Traditional)
Real Return Growth return
pathway (MAGS)
Staying invested in a diversified portfolio
Approach 2: The smoother journey
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15. The “Journey”: Multi-asset
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16. Implications for Australian investors
Does the experience of the last
decade tell us anything about
designing portfolios for the next one?
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17. Looking ahead … meeting objectives gets harder from here
Solutions for challenging times 19
More downside
than upside
Real solutions needed
for real client problems
Volatility set to
increase
• Mature cycle
• Expensive valuations
• Risk skewed to the
downside
• Low volatility reveals
investor complacency
• Volatility returns with
a vengeance
• Hallmark of late-cycle
markets
• Significant sequencing risk
• Underfunded clients need growth,
but without the downside
• Concentrated and low-cost
passive portfolios highly exposed
• Dynamic solutions providing same
real return with less downside
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18. Meeting the challenge to ‘get what you need’
The investment challenge
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Real Return
4.0%
Inflation
2.4%
Return Gap
1.9%
SOURCE: Russell Investments. Based on 5 year capital market assumptions as at 31 December 2018. Gross A$, % per annum terms.70/30 Beta portfolio return based on
allocation of 35% Aus equities, 35% Global equities (50% A$ Hedged), 10% Aus Fixed Income, 15% Global Fixed Income, 5% Cash
Investor NEEDS
CPI+4% pa
Investor GETS
CPI+2.1% pa
Inflation
2.4%
Real Return
2.1%
Critical success factors to
bridge the return gap
Dynamic
management
Downside
limitation
Additional return
sources
Efficient
implementation

19. Key features of Russell Investments Dynamic Real Return Series
Our approach … real solutions to meet the challenge
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REAL
DIVERSIFICATION
Broader range of non-
traditional return sources
to provide real
diversification.
DYNAMIC
MANAGEMENT
Large, systematic
adjustments of market
exposures. Embedding
a return skew for tighter
risk control.
OUTCOME
FOCUSED
Growth-style real
return objective with
half the volatility of
the share market.
DOWNSIDE
LIMITATION
Greater focus on
cost-effective
downside limitation
strategies.

20. Russell Investments Dynamic Real Return Series
Outcome focus
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Multi-Asset Growth Strategy Plus
Fund (MAGS+)
Multi-Asset Income Strategy Fund
(MAIS)
Multi-Asset Growth Strategy Fund
(MAGS)
Inflation +
5%
% ASX Vol
2/3 High Low
Inflation +
4%
% ASX Vol
1/2 High Medium
Inflation+
2%
% ASX Vol
1/3 High High
Return
Objective
Volatility
Objective
Drawdown
Risk Focus
Income
Focus
Russell Investments Dynamic Real
Return Series:
Our dynamic real return funds
cover a range of objectives, to
suit investors needing a
specific real return, with a
smoother journey along the
way.
Dynamic risk management,
wider allocation ranges, a
focus on downside risk and a
broad set of alternative return
sources are the keys to
success.
Return objectives shown are
net of fees.
Focus on real outcomes
Source: Russell Investments

21. Disciplined systematic process to significantly adjust market exposure through the cycle
Dynamic management
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Our dynamic CVS process
allows portfolio managers
to address asset class
mispricing and reduce risky
exposures as the
possibility of a downturn
increases.
.
Cycle, Value, Sentiment
Source: Russell Investments. Figures shown are for the Russell Investments MAGS Fund, Class A, net A$ terms. As at 30 June 2018. Past performance is no guarantee
of future performance.
0
10
20
30
40
50
60
70
80
90
100
Equities Alternatives Fixed Income & CashCYCLE
Identifies changes in the macroeconomic
environment that influence asset class
behaviour
VALUATION
Measures return potential across asset
classes, but is the smallest weight in the
tactical framework
SENTIMENT
Looks at price momentum versus
contrarian indicators that signal
overbought/oversold conditions
A STRUCTURED AND CONSISTENT APPROACH
DESIGNED TO ADDRESS BEHAVIOURAL BIAS
ASSET ALLOCATION
HISTORY (MAGS FUND, JAN -13 TO JUN -18)

22. The less you lose, the less you have to make up in a lower return environment
Downside limitation
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SOURCE: Russell Investments. For illustrative purposes only.
-10%
-20%
-30%
-40%
-50%Drawdown return
11%
25%
43%
67%
100%
Return required to
recover after a drawdown
Integration of dynamic position
management and cost-effective
protection strategies limit
participation on the
downside. Skewing returns is
critical for achieving outcomes
in a low return, high volatility
environment.
The importance of ‘skew’
Return required to recover
after a drawdown
Drawdown return
11%
25%
43%
67%
100%
-10%
-20%
-30%
-40%
-50%

23. Russell Investments MAGS asset allocation (30 June 2018)
Real diversification
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A broader range of
complementary and non-
traditional return sources to
provide real diversification.
Adds the additional return
drivers and risk management
levers essential for achieving
outcomes in a low return /
high volatility environment.
Broader return sources
Australian Shares 5.7%
International Shares 27.8%
Property 1.5%
Fixed Income & Cash 49.7%
Source: Russell Investments. Figures shown are for
Russell Investments MAGS Fund, Class A, net A$
terms. As at 30 June 2018. Past performance is not a
reliable indicator of future performance.
Russell Investments Australian Factor Exposure Fund 2.4%
Vinva Australian Equitised Long/Short 6.8%
Options (ASX200) 4.2%
Futures (ASX200) -7.7%
CPI +4%
Net return objective (%pa)
50%
of Sharemarket Volatility
objective (vs ASX300)
Russell Investments Global Opportunities Fund 7.6%
Russell Investments Global Opportunities Fund – A$ Hedged 12.8%
Vinva Asia-Pacific Equity Long/Short Fund 1.1%
Futures – Basket (Strategic) 5.3%
Futures – Emerging Markets 0.7%
Futures – USA 0.4%
Commodity Futures (Strategic) 4.8%
Russell Investments Emerging Market Debt (Local) Fund 7.0%
Russell Investments Multi-Strategy Volatility Premia Fund 0.9%
Russell Investments Global High Yield Fund – A$ Hedged 1.6%
Russell Investments Global List. Infrastruct. Fund – A$ Hedged 1.0%
Perpetual High Grade Treasury Fund 17.0%
Metrics Credit Div. Aust. Senior Loan Fund 4.6%
Russell Investments Floating Rate Fund – A$ Hedged 8.0%
Russell Investments Australian Bond Fund 10.1%
Russell Investments Int’l Bond Fund – A$ Hedged 5.3%
Russell Investments Global Bond Fund – A$ Dur. Hedged 4.7%
Russell Investments Int’l Property Securities Fund 1.5%
Alternatives 15.3%
GrowthDefensive

24. How comfortable is your investment journey?
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25. More Information
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NSW
Terry Tyrrell
Regional Manager
Russell Investments
ttyrrell@russellinvestments.com
(t) 02 9229 5360
(m) 0419 264 276
VIC/ACT
Tanya Hoshek
Senior Regional Manager
Russell Investments
thoshek@russellinvestments.com
(t) 03 9270 8138
(m) 0434 402 865
QLD
Bruno Santos
Regional Manager
Russell Investments
bsantos@russellinvestments.com
(t) 07 3221 4666
(m) 0434 560 644
SA/VIC/TAS
Tim Reimers
Regional Manager
Russell Investments
treimers@russellinvestments.com
(t) 03 9270 8230
(m) 0426 826 336
NSW/WA
Allister Hoffenberg
Regional Manager
Russell Investments
ahoffenberg@russellinvestments.com
(t) 02 9229 5534
(m) 0402 373 970
Russell Investments
Adviser & Intermediary Solutions Team

26. Important information and disclosures
Issued by Russell Investment Management Ltd ABN 53 068 338 974, AFS Licence 247185 (“RIM”). This information is
provided for the use of licensed financial advisers only. In no circumstances is it to be used by a potential investor
for the purposes of making a decision about a financial product or class of products. This information has been
prepared without taking account of investors’ objectives, financial situation or needs. This information has been
compiled from sources considered to be reliable, but is not guaranteed. Past performance is not a reliable indicator
of future performance.
Any potential investor should consider the latest PDS in deciding whether to acquire, or to continue to hold, an
investment in any Russell product. The PDS is currently available and can be obtained by phoning (02) 9229 5111 or
by visiting www.russell.com.au. RIM is part of the Russell Investment Group (“Russell”). Russell or its associates,
officers or employees may have interests in the financial products referred to in this information by acting in various
roles including broker or adviser, and may receive fees, brokerage or commissions for acting in these capacities. In
addition, Russell or its associates, officers or employees may buy or sell the financial products as principal or
agent.
Copyright © 2018 Russell Investments. 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.
RUSSELL INVESTMENTS. FOR USE BY FINANCIAL PROFESSIONALS ONLY.

27. | netwealth30
This webinar and information has been prepared and issued by Netwealth Investments Limited (Netwealth), ABN 85 090
569 109, AFSL 230975. It contains factual information and general financial product advice only and has been prepared
without taking into account the objectives, financial situation or needs of any individual. The information provided is not
intended to be a substitute for professional financial product advice and you should determine its appropriateness having
regard to you or your client’s particular circumstances. The relevant disclosure document should be obtained from
Netwealth and considered before deciding whether to acquire, dispose of, or to continue to hold, an investment in any
Netwealth product.
While all care has been taken in the preparation of this document (using sources believed to be reliable and accurate), no
person, including Netwealth, or any other member of the Netwealth group of companies, accepts responsibility for any loss
suffered by any person arising from reliance on this information.
Disclaimer
Thank you
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