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Quarterly Review: Lifepoints© Funds Target Portfolio Series

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Quarterly Review: Lifepoints© Funds Target Portfolio Series BALANCE LifePoints© Funds Target Portfolio Series Moderate Strategy Fund Quarterly Review Second Quarter 2021 • May Lose Value • Not FDIC Insured • May Lose Value • No Bank Guarantee • Not Insured by any Federal Government Agency June 30, 2021 / LifePoints® Target Portfolio Series Moderate Strategy Fund CONTENTS Page Strategy (or Model) Commentary 3 Capital Markets Commentary 4 Performance Information 5 Manager Allocation 6 Russell Investments / LifePoints® Target Portfolio Series Moderate Strategy Fund / 2 June 30, 2021 / LifePoints® Target Portfolio Series Moderate Strategy Fund Strategy Commentary 2Q 2021 TARGET PORTFOLIO SERIES MODERATE STRATEGY UNDERLYING FUND PERFORMANCE CLASS Y Return % 12 9.92 10 8 7.77 5.99 6 5.59 5.29 4.81 4 2.66 2.42 2 1.29 0.31 0 Multifactor U.S. U.S. Small Cap Multifactor Global Equity Emerging Markets Global Real Estate Unconstrained Strategic Bond Multifactor Bond Multi-Strategy Equity Equity International Equity Securities Total Return Income EQUITIES • The Multifactor U.S. Equity Fund lagged the Russell 1000® Index for the quarter as an overweight to the volatility factor detracted, although positive security selection within healthcare helped offset losses. • The Multifactor International Equity Fund underperformed the benchmark (MSCI World ex USA Index Net) for the quarter. Stock selection within fi nancials and materials were the largest detractors, although selection within communication services and consumer staples helped offset some losses. FIXED INCOME • The Strategic Bond Fund marginally outperformed the Bloomberg Barclays Aggregate Bond Index for the quarter. Overweight to securitized fi xed income and underweight to mortgage-backed securities was benefi cial as spreads tightened. • The Unconstrained Total Return Fund outperformed the benchmark (ICE BofA 3 Month Treasury Bill Index) for the quarter. The fund’s core yield engine was the main performance driver as credit spreads continued to tighten. ALTERNATIVE • The Global Real Estate Securities Fund outperformed its benchmark (FTSE EPRA Nareit Developed Real Estate Index) for the quarter as positive stock selection, specifi cally within European and Asian regions, was the main driver of returns. MULTI-ASSET • The Multi-Strategy Income Fund outperformed its benchmark (ICE BofA Global High Yield 2% Constrained Index) for the quarter. The funds’ prepayment strategy detracted in response to lower rates and higher home prices. Although, a longer duration stance within fi xed income was benefi cial. Russell Investments / LifePoints® Target Portfolio Series Moderate Strategy Fund / 3 June 30, 2021 / LifePoints® Target Portfolio Series Moderate Strategy Fund Capital Markets Insights Return on Indexes 62.0 45.6 43.1 42 33.6 32 21.2 22 19.2 18.0 17.5 16.5 15.5 15.0 14.9 14.5 13.5 13.3 12.3 Rate of Return % 12 9.2 8.5 7.6 7.4 6.9 6.4 6.4 5.3 5.0 4.3 3.9 3.4 3.2 3.0 2.4 2.4 1.8 2 0.3 - 1.6 - -8 4.4 Latest Qtr YTD 1 Year 3 Year 5 Year 10 Year- Russell 1000® Index Russell 2000® Index Bloomberg Commodity Index Total Return FTSE EPRA Nareit Developed Real Estate Index ICE BofA Merrill Lynch Global High Yield Index (hedged) Bloomberg Barclays U.S. Aggregate Bond Index U.S. Equity Indexes U.S. equities were up on positive economic data and hopes of reopening as vaccine rollouts continued. Large cap as measure by the Russell 1000® Index 8.5% outperformed small cap as measured by the Russell 2000® Index +4.3%, and growth stocks as measured by the Russell 1000® Growth Index returned +11.9%, outperformed value stocks which rose +5.2% as measured by the Russell 1000® Value Index. The winners within the Russell 1000® Index were technology +14.0%, and energy +11.7%. Utilities was the worst performing large cap sector, up +0.5%. Non-U.S. Equity Indexes The MSCI EAFE and the MSCI Emerging Markets Indices both ended the quarter up +5.2% and +5.0% respectively as vaccine rollouts accelerated and on strong corporate earnings. The BRICs were all positive, Brazil +22.9%, Russia +14.0%, India +6.9%, and China +2.3%. Brazil was the best performing emerging markets country for the quarter, and Chile was the worst. Alternative Indexes The S&P Global Infrastructure Index (+2.1%) and the FTSE EPRA Nareit Developed Index (+9.2%) were both up for the quarter. Commodities as measured by the Bloomberg Commodities Index was up (+13.3%) driven by a recovery in demand as economies benefi ted from worldwide vaccine rollouts. Soybeans were the top performing sector (+31.8), and platinum (-10.3%) was the worst performing sector in 2Q. Fixed Income Indexes Global fi xed income markets were up despite infl ation concerns. The Bloomberg Barclays U.S. Aggregate was up +1.8% and U.S. Treasuries fi nished the quarter up at +1.7%. Elsewhere, the JP Morgan Emerging Markets Bond Index (USD) was up +4.4%, and the Bloomberg Barclays Global High Yield Index (USD) was up +3.1%. Source: Russell Investments. The 1 year, 3 year, 5 year and 10 year returns shown above are annualized to the most recent quarter end. Indexes 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 specifi c investment. Performance is as of 06/30/2021. Forecasting represents predictions of market prices and/or volume patterns utilizing varying analytical data. It is not representative of a projection of the stock market, or of any specifi c investment. Nothing contained on this page is intended to constitute legal, tax, securities or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. The general information contained in this publication should not be acted upon without obtaining specifi c legal, tax and investment advice from a licensed professional. Investments that are allocated across multiple types of securities may be exposed to a variety of risks based on the asset classes, investment styles, market sectors, and size of companies preferred by the investment managers. Investors should consider how the combined risks impact their total investment portfolio and understand that different risks can lead to varying fi nancial consequences, including loss of principal. Please see a prospectus for further details. Investments in emerging or developing markets involve exposure to economic structures that are generally less diverse and mature, and to political systems which can be expected to have less stability than those of more developed countries. Securities may be less liquid and more volatile than US and longer-established non-US markets. Investments in global equity may be signifi cantly affected by political or economic conditions and regulatory requirements in a particular country. International markets can involve risks of currency fl uctuation, political and economic instability, different accounting standards and foreign taxation. Emerging or frontier markets involve exposure to economic structures that are generally less diverse and mature. The less developed the market, the riskier the security. Such securities may be less liquid and more volatile. Investments in small cap, micro cap, and companies with capitalization smaller than the Russell 2000® Index, are subject to the risks of common stocks, may experience considerable price fl uctuations and are more volatile than large company stocks. Generally, the smaller the company size, the greater the risks. Please remember that all investments carry some level of risk, including the potential loss of principal invested. They do not typically grow at an even rate of return and may experience negative growth. As with any type of portfolio structuring, attempting to reduce risk and increase return could, at certain times, unintentionally reduce returns. Russell Investments / LifePoints® Target Portfolio Series Moderate Strategy Fund / 4 June 30, 2021 / LifePoints® Target Portfolio Series Moderate Strategy Fund Investment Objective Performance Review / as of June 30, 2021 ANNUALIZED The Fund seeks to provide current 1 3 5 10 Since Quarterly Year-to-Date income and moderate long term capital Year Years Years Years Inception appreciation. Moderate Strategy Fund - Class S †(b) 3.46 5.94 15.49 5.48 5.39 4.78 5.09 Underlying Fund Allocation (%) †Annual Fund Operating Expenses % Total 1.10 Net 0.88 Equity Funds 38 Fund Inception date: 10/02/97 Multifactor U.S. Equity 9.5 Growth of 10K Since Inception U.S. Small Cap Equity 4 Multifactor International Equity 4 Global Equity 18.5 Emerging Markets 2 Alternative Funds 3 Global Real Estate Securities Fund 3 Fixed Income Funds 49 Unconstrained Total Return 2 Strategic Bond 33 Mulitfactor Bond 14 Multi-Asset Funds 10 Multi-Strategy Income 10 Calendar year returns (%) 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 14.69 7.74 4.78 9.82 6.68 -23.35 24.24 12.53 0.01 10.56 6.57 4.76 -1.67 7.66 8.71 -4.30 10.92 3.56 Underlying fund performance (%) ANNUALIZED Year-to- 3 5 10 Since Inception RIC Funds Class Y Quarterly 1 Year Total Net † Date Years Years Years Inception Date ‡ Multifactor U.S. Equity †(b) 7.77 15.43 41.90 15.77 16.15 -- 13.25 7/31/2014 0.42 0.35 U.S. Small Cap Equity 5.29 23.32 69.37 12.70 15.46 11.94 11.24 12/28/1981 0.97 0.97 Multifactor International Equity †(b) 4.81 11.69 33.99 6.21 8.91 -- 3.97 7/31/2014 0.65 0.44 Global Equity †(b) 5.99 15.09 44.52 14.55 15.19 10.44 7.15 2/28/2007 1.10 0.79 Emerging Markets †(a) 5.59 9.64 41.18 9.05 11.40 3.72 6.69 1/29/1993 1.35 1.04 Global Real Estate Securities †(b) 9.92 15.83 35.59 7.85 6.31 6.82 9.48 7/28/1989 0.95 0.90 Unconstrained Total Return †(b) 0.31 0.83 5.58 1.75 -- -- 2.12 9/22/2016 1.39 0.68 Strategic Bond †(b) 2.42 -1.19 2.21 6.10 3.55 3.91 5.53 1/29/1993 0.57 0.44 Multifactor Bond †(b) 1.29 -1.17 1.92 -- -- -- 3.93 11/13/2019 0.84 0.26 Multi-Strategy Income †(b) 2.66 6.95 17.20 5.92 6.19 -- 4.90 5/1/2015 0.93 0.58 Performance information is historical and does not guarantee future results.
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