LSE May Only Want Russell Indexing Business

If LSE does take on Russell’s asset management unit, the exchange operator will be forced to explain the deal to shareholders or perhaps a mull a spinoff of the investment management operation, the Seattle Times reported.

LSE would become the third-largest index provider behind S&P Dow Jones and MSCI (NYSE: MSCI) if it acquires Russell.

Several of the largest international ETFs that trade in the U.S. are benchmarked to FTSE indices including the Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO), the largest emerging markets ETF by assets, and the Vanguard FTSE Europe ETF (NYSEArca: VGK). The iShares China Large-Cap ETF (NYSEArca: FXI), the largest China ETF, also tracks a FTSE index.

Russell is in the index provider for large ETFs such as the $25.1 billion iShares Russell 2000 ETF (NYSEArca: IWM) and the $6 billion iShares Russell Midcap Value ETF (NYSEArca: IWS).


ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of IWM.