Effective June 20, Russell Investment Group has removed Guardian Capital LP from the Russell Canadian Equity Fund and Sovereign Canadian Equity Pool.

The Russell Canadian Equity Fund is a multi-manager fund available to institutional investors, and is also one of the underlying funds to LifePoints Portfolios, Russell’s fund-of-funds available to both individual and institutional investors.

The Sovereign Canadian Equity Pool is one of seven multi-manager pools in the Sovereign Investment Program – a Russell investment program designed for the needs of high-net worth individuals.

With the addition of managers Connor, Clark & Lunn and Picton Mahoney Asset Management (hired in March 2004 and December 2004, respectively), Guardian’s small cap mandate no longer fills a structural role in the funds, Russell says.

CC&L is a market-oriented manager that invests across the broad market cap spectrum, and tends to be capitalization-neutral. Picton is a growth manager that shifts their portfolio emphasis to the capitalization areas where they feel the best opportunities exist, and have no persistent bias towards large, mid or small cap stocks.

Research conducted by Russell’s investment management team concluded that, with the new manager line-up, the funds will tend to be more exposed to small cap securities than it had been historically, and that maintaining Guardian in the manager line-up would cause the funds’ small cap bias to increase beyond desired levels.

At the time of this change Guardian’s mandate represented only 3% of the fund. Russell says their holdings were distributed amongst the remaining managers.

Guardian’s removal from the fund leaves the desired small cap exposure roughly unchanged.