Table of Contents
OMB APPROVAL | ||
OMB Number: | 3235-0570 | |
Expires: | August 31, 2010 | |
Estimated average burden | ||
hours per response: | 18.9 | |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-05371
Russell Investment Funds
(Exact name of registrant as specified in charter)
909 A Street, Tacoma Washington 98402
(Address of principal executive offices) (Zip code)
Gregory J. Lyons, Assistant Secretary
Russell Investment Funds
909 A Street
Tacoma, Washington 98402
253-439-2406
(Name and address of agent for service)
Registrant’s telephone number, including area code: 253-572-9500
Date of fiscal year end: December 31
Date of reporting period: January 1, 2007 to December 31, 2007
Table of Contents
| Item 1. | Reports to Stockholders |
Table of Contents
2007 ANNUAL REPORT
Russell Investment Funds
DECEMBER 31, 2007
FUND
Multi-Style Equity Fund
Aggressive Equity Fund
Non-U.S. Fund
Real Estate Securities Fund
Core Bond Fund
Table of Contents
Russell Investment Funds
Russell Investment Funds is a series investment company with nine different investment portfolios referred to as Funds. These financial statements report on five of these Funds.
Table of Contents
Russell Investment Funds
Annual Report
December 31, 2007
Table of Contents
Russell Investment Funds
Copyright © Russell Investment Group 2008. All rights reserved.
Russell Investment Group is a Washington, USA corporation, which operates through subsidiaries worldwide and is a subsidiary of The Northwestern Mutual Life Insurance Company.
Fund objectives, risks, charges and expenses should be carefully considered before investing. A prospectus containing this and other important information must precede or accompany this material. Please read the prospectus carefully before investing.
Securities distributed through Russell Fund Distributors, Inc. member Financial Industry Regulatory Authority, part of Russell Investment Group.
Russell Investment Group and Standard & Poor’s Corporation are the owners of the trademarks, service marks, and copyrights related to their respective indexes. Index performance is not indicative of the performance of any specific investment. Indexes are not managed and may not be invested in directly.
Performance quoted represents past performance and does not guarantee future results. The investment return and principal value of an investment will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted.
Table of Contents
Thank you for taking the time to review Russell Investment Funds’ 2007 Annual Report. The portfolio management discussions and fund-specific details will give you a deeper understanding of fund performance for the fiscal year ended December 31, 2007.
Every day, we strive to improve financial security for people and earn the continued support of our investors.
Our decades of experience evaluating global markets — and the people who make investment decisions in them — extends through numerous cycles, trends and turnarounds. It’s a perspective that allows us to deliver you long-term investment strategies.
Our dedicated money manager research analysts and portfolio managers perform the vital work to select some of the world’s best managers for the funds. This deliberate combination of investment managers is intended to help provide more consistent returns through all kinds of market environments.
We appreciate your continued support.
Regards,
Greg Stark
Chief Executive Officer, Chairman and President
Russell Investment Management Company
| To Our Shareholders | 3 |
Table of Contents
Russell Investment Funds
Market Summary as of December 31, 2007 (Unaudited)
U.S. Equity Markets
For the fiscal year ending December 31, 2007, US equity markets were positive, with the broad market Russell 3000® Index returning 5.1%. Stocks benefited from increased merger and acquisition activity during the first half of the year, and from surprisingly strong corporate profits. For the fiscal year, the growth rates of gross domestic product and corporate profits remained strong but decelerated toward year end. After almost four years of double-digit profit growth, earnings growth fell to single digit levels.
The housing slowdown that began in the summer of 2006 continued through this fiscal year, and was further impacted by rising defaults rates in subprime loans. At the same time, there was significant weakness in the US dollar, as it depreciated against all major currencies. In the fiscal year, The Federal Reserve Board lowered the federal funds rate three times, the first such cuts in four years, citing the slowing pace of economic expansion and the intensification of the housing correction as the reason behind the cuts. The period also saw significantly higher commodity prices across the board due in part to significant global demand from developing nations.
Although the domestic economy was decelerating, the U.S. equity market was buoyed by strong exports to faster growing developing, non-U.S. economies. With approximately 40% of U.S. corporation’s revenues derived from international customers, the declining U.S. dollar provided increased demand for U.S. products abroad.
In the wake of these powerful macroeconomic forces, the fiscal year was a transitional one marked by three distinct themes: Multinational companies with exposure to developing markets outpaced domestically-driven companies, growth companies fared better than their value counterparts and U.S. large capitalization stocks outperformed U.S. small capitalization stocks.
US companies with revenue streams that could benefit either directly or indirectly from the expanding global economy were rewarded over the fiscal year. The best performing sectors in the Russell 3000® Index were those that had some tie to the global markets — commodities, technology, and industrials. Agriculture and fertilizer stocks led the Russell 3000® Index due to increased global demand for food and an increase in corn production due to ethanol demand. Similarly, commodities related companies, especially copper, benefited from the construction boom in Asia and elsewhere. For the fiscal year, the other energy sector of the Russell 3000® Index returned 38.9%, the integrated oils sector returned 29.6%, and the materials and processing sector returned 26.0%.
The worst performing sectors in the Russell 3000® Index were those tied closely to domestic consumer spending and the housing and subprime markets, particularly mortgage lenders. The repercussions of the developments in the subprime lending market and the resulting housing slowdown caused homebuilders and building related industries to struggle as well. The financial services sector returned - -16.3% for the fiscal year and consumer discretionary sector returned -3.6%, both significantly trailing the Russell 3000® Index return of 5.1%.
| 4 | Market Summary |
Table of Contents
Russell Investment Funds
Reversing a trend that had prevailed for the last six years, growth stocks outperformed value stocks over the fiscal year. Growth and momentum factors were rewarded over the period, especially exposure to high price to book stocks and those with high historical growth rates. The Russell 1000® Growth Index returned 11.8% while the Russell 1000® Value Index returned -0.2%. A similar trend was seen in small cap markets, with the Russell 2000® Growth Index and Russell 2000® Value Index returning 7.1% and -9.8%, respectively.
In a turnaround from the previous fiscal year, large capitalization stocks outperformed small capitalization stocks. The Russell 1000® Index returned 5.8% for the fiscal year, while the Russell 2000® Index returned -1.6%. The larger in capitalization a company was, the better its returns were over the fiscal period. Microcap stocks struggled even more than the broader small cap Russell 2000® Index, with the Russell Microcap Index returning -8.0% for the fiscal year.
During the fiscal year, the market environment was largely favorable for active growth managers. The Lipper Large Cap Growth Funds Average outperformed the Russell 1000® Growth Index by 2.33%, as active managers held companies with strong momentum that were growing faster than the companies in the Russell 1000® Growth Index. The period was also favorable for active value managers who typically do not have as much exposure to the financial services sector as the Russell 1000® Value Index. The Lipper® Large Cap Value Funds Average outperformed the Russell 1000® Value Index by 2.28%. The market environment was more challenging for active core, or market-oriented, managers as the markets were driven by commodity based companies, not an area where market-oriented managers typically focus. The Lipper® Large Cap Core Funds Average barely trailed the Russell 1000® Index by 0.19% net of fees, but modestly outperformed on a gross of fee basis. The Lipper® Small Cap Core Funds Average slightly outpaced the Russell 2000® Index by 0.18%.
U.S. Real Estate Markets
For the fiscal year ending December 31, 2007, real estate investment trusts (REITs) generated a -15.69% return, as measured by the FTSE NAREIT Equity Index. As well as being well below the overall U.S. equity market return, this return represented a substantial pull-back from the prior year’s return of 35.06%. The low REIT return was also accompanied by exceptionally high volatility during the period. In January, REITs were up over 8%; in June and July, REITs lost over 16%. From August through October, REITs rallied with a gain of over 12% and, finally, during the last two months, REITs experienced a decline of over 13%.
Early in the fiscal year, the REIT market continued to be driven by the same factors that made the prior year so successful, mainly mergers and acquisitions by private investors acquiring public REITs at large premiums to their share prices. The most prominent privatization was Equity Office Property, the industry’s largest REIT, which became the prize in a bidding war between Blackstone, a private equity firm and Vornado, a public company. The REIT market peaked at all-time record levels in mid-February 2007. At that time, while property market fundamentals were improving and REIT earnings were solid, REIT pricing appeared to be well ahead of earnings expectations.
By June 2007, concerns arose among REIT investors that problems in the residential subprime mortgage loan market would be a precursor to similar issues in the commercial mortgage market. Additionally, the 0.6% increase in the 10 year treasury rate which occurred during that month caused investors to reassess the capitalization rates used to value real estate. These events combined to put substantial downward pressure on REIT share prices.
During the last few months of the year, REITs suffered along with the other financial sector stocks as sentiment turned decidedly negative for this broad market sector. Concerns about a weaker economy and tightened credit put upward pressure on dividend yields and contributed to higher capitalization rates and
| Market Summary | 5 |
Table of Contents
Russell Investment Funds
discount rates used to value underlying properties. Over the course of the year, the average dividend yield for companies in the FTSE NAREIT Equity Index increased sharply, from 3.69% to 4.91%. In the fourth quarter, the average dividend yield increased from 4.12% to 4.91%. REITs ended the year with dividend yields trading at a premium to the 10-year Treasuries, which ended the year at 4.03%.
Non-U.S. Equity Markets
Non-U.S. stocks gained 11.17% as measured by the MSCI EAFE Index for the fiscal year ending December 31, 2007. Non-U.S. stocks were boosted as the U.S. dollar weakened over the course of the fiscal year. In local currency, the MSCI EAFE Index rose 3.54% over the 12-month period.
The market continued to benefit from global growth, merger and acquisition activity and strong corporate earnings, especially in the first half of the year. In the second half of the year, the market withstood several periods of increased market volatility brought on by investors’ risk aversion relating to the potential negative spillover effects of the developments in the subprime lending market and housing slowdown in the U.S. Growth in emerging economies, like India and China, also had a positive impact on the strength of developed markets through their demand for goods and infrastructure development throughout the year.
Europe, as represented by the MSCI Europe Index, returned 13.86% over the fiscal year. Merger and acquisition-related gains combined with strong earnings drove European equities higher, with merger-and-acquisition activity in the year surpassing last year’s record pace. Across Europe, the best performing sectors were materials and utilities, up 38.95% and 33.00%, respectively. By country, Germany was a notable contributor to performance, benefiting from the strong performance of its automobiles industry. Elsewhere, MSCI United Kingdom Index lagged Continental Europe with a gain of 8.36%. The U.K. underperformed the rest of Europe due to weakness in its financials sector.
The MSCI Japan Index continued to lag other major non-U.S. markets in the fiscal year, with a return of -4.23% for the year. Investor concerns included weak economic data, lackluster earnings, and political turmoil. Elsewhere in the region, the MSCI Pacific ex-Japan Index gained 30.73% with strong gains in the Hong Kong, Singapore and Australian markets.
From a sector perspective, materials stocks had the best returns, up 31.75%, especially in the area of metals and mining, which was driven by industry consolidation and the continued upturn in commodities prices. Telecommunication services, up 28.21%, also benefited from strong earnings results. Health care and financials were the notable laggards, returning 0.55% and -1.82%, respectively, as measured by the MSCI EAFE health care and financials sector groupings.
The year also saw a change in market leadership from previous years, both in terms of style and market cap. Market leadership during the period favored growth stocks, with the MSCI EAFE Growth Index rising 16.45%, compared with 5.96% for the MSCI EAFE Value Index. Investors, in general, favored larger capitalization stocks over smaller capitalization stocks with the S&P/Citigroup PMI World ex-U.S. Index (an index of larger capitalization companies) up 14.17% in the period versus the S&P/Citigroup EMI World ex-U.S. (in index of smaller capitalization companies) up 7.32%.
Markets not represented in the MSCI EAFE Index, but commonly included in non-U.S. stock funds, offered significant opportunities for gains during the period. Emerging markets outperformed their developed counterparts, as the MSCI Emerging Markets Index rose 39.39%. Emerging markets countries benefited from continued strong economic growth, which benefited the materials and industrials sectors (both posting over 60% returns for the period.) Canadian stocks, as measured by the MSCI Canada Index, rose 29.57% during the period.
| 6 | Market Summary |
Table of Contents
Russell Investment Funds
U.S. Fixed Income Markets
The Lehman Brothers U.S. Aggregate Bond Index, a broad measure of U.S. investment grade fixed income securities, returned 6.97% for the year ended December 31, 2007. All major sub-sectors trailed U.S. Treasuries as the subprime crisis largely caused a widespread “flight to quality” throughout fixed income markets, where investors moved their capital away from riskier investments to the safest possible investments (in this case U.S. Treasuries).
There were two predominant factors that affected fixed income markets throughout fiscal 2007. The first, occurring during the third quarter of calendar 2007, took the form of a massive re-pricing of risk across many fixed income sectors, largely as a result of developments within the subprime lending market. The second was the Federal Reserve’s second and third quarter cuts to the target federal funds rate for overnight loans between banks, combined with the global liquidity plan the Fed orchestrated with other major central banks.
The Subprime Market
Subprime borrowers are often defined loosely as those borrowers with higher risk/higher interest rate loans because of lack of income documentation, poor credit history, and/or high loan-to-value ratios. The proliferation of the subprime mortgages – and securities firms packaging the subprime debt into AAA-rated bonds — helped fuel the U.S. housing boom over the past decade.
Many factors contributed to a surge in what some regard as looser mortgage lending practices in late 2005 and 2006. The strength of the real estate market created additional demand for mortgage-backed securities, including those that were backed by subprime loans. This increased the potential profit for originating subprime mortgages, loans which many banks had previously avoided making because of their higher default risk. Traditional requirements to obtaining a mortgage (such as proof of income, a down payment or a moderate loan-to-value ratio) were abandoned and adjustable rate loans with artificially low introductory rates and interest-only loans became more common. Record low interest rates and loosening lending standards assisted in pushing real estate prices to record highs and resulted in a record number of re-financings. A high level of liquidity in the market enabled investment banks to borrow more to produce more “structured” financial products. This included buying lower credit rated mortgage-backed securities and re-packaging them into higher rated collateralized debt obligations (CDOs), which were in turn re-introduced into the market.
Problems in the subprime market appeared during the fourth quarter of 2006 when borrower delinquencies reached a four-year high1. Adjustable rate mortgages reset to higher rates and some borrowers could not afford to make the new higher monthly payments. The housing market began to cool, with some borrowers now owing more than their homes were worth.
Concerns increased in May 2007 when the U.S. housing market continued to soften and, for the first time since 1991, national home prices posted a year-over-year decrease2. During 2007, the level of payment delinquencies and early defaults on mortgage loans to subprime borrowers increased significantly. Demand for CDOs evaporated and mortgage lenders no longer had easy access to capital to originate loans. Investors became more risk averse and a flight to quality ensued.
1 | Bloomberg, U.S. Subprime Mortgage Delinquencies at 4-Year High, 13-Mar-07. |
2 | Bloomberg, Fed Sees Housing Dampening Growth Longer than Expected (per S&P/Case-Shiller study), 30-May-07. |
| Market Summary | 7 |
Table of Contents
Russell Investment Funds
The subsequent fallout from developments in the subprime market has been widespread. The housing market, consumer confidence and companies in the financial services sector were negatively impacted. Access to capital became more constrained resulting in less liquidity in the markets and a “credit crunch” (an environment where investment capital is difficult to obtain). Some mortgage lenders declared bankruptcy or exited the business. Non-U.S. Treasury fixed income sectors generally performed poorly as investors moved out of those sectors and into U.S. Treasuries. The uncertainty surrounding the extent of the impact to the global economy led to market volatility and impacted equity and fixed income markets around the globe.
The Federal Reserve’s rate cuts and global liquidity plan
On two separate occasions during the third quarter of 2007, the Federal Reserve (“the Fed”) cut the target rate for overnight loans between banks. On September 18, the Fed lowered the target rate by 0.50% to 4.75%, the first rate change since the Fed last raised the target to 5.25% in June 2006. The reason cited for the cut was that “the tightening of credit conditions has the potential to intensify the housing correction and to restrain economic growth more generally” and that the rate cut “is intended to help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and to promote moderate growth over time”3. On October 31, a further 0.25% cut lowered the target rate to 4.50%, with the Fed stating that inflation and growth risks were approximately balanced.
On December 11, the Fed cut the target rate for overnight loans between banks by 25 basis points (less than the anticipated 50 basis point cut) to 4.25%, stating that recent developments “have increased the uncertainty surrounding the outlook for economic growth and inflation.” Stocks declined and Treasuries surged as investors thought that the move was not sufficient to hold off an economic downturn. The following day the Fed, in conjunction with the European Central Bank (ECB) and central banks in England, Switzerland and Canada, announced the biggest act of global economic cooperation since the September 11th terrorist attacks, a multi-stage plan designed to provide liquidity to the stressed credit markets. In a related move, the ECB flooded financial markets with $500 billion in two-week loans to banks, the largest amount ever extended in a single move by the ECB. This was done in order to maintain liquidity in other markets at year-end.
Prior to the Fed rate cuts, the flight to quality pushed up U.S. Treasury prices, which, in turn, lowered their yields (also referred to as a downward shift in the yield curve). The Fed’s rate cuts propelled this downward progression of yields across all maturities. During 2007, yields on 2-year maturity Treasuries declined 1.76 % while yields on 10-year maturities declined 0.68%. A major change was the yield curve shifting from its beginning-of-year inverted (i.e. downward sloping) position by steepening significantly between 2- and 10-year maturities. The 2-year/10-year spread widened 1.08%, going from (0.11)% to 0.98%.
3 | Bloomberg, Fed Surprises with a 50-basis point Rate Cut, 18-Sep-07. |
| 8 | Market Summary |
Table of Contents
(This page intentionally left blank)
Table of Contents
Russell Investment Funds
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
| Multi-Style Equity Fund | |||
| Total Return | |||
1 Year | 10.36 | % | |
5 Years | 13.56 | %§ | |
10 Years | 5.11 | %§ | |
| Russell 1000® Index ** | |||
| Total Return | |||
1 Year | 5.77 | % | |
5 Years | 13.43 | %§ | |
10 Years | 6.20 | %§ | |
| * | Assumes initial investment on January 1, 1998. |
** | Russell 1000® Index includes the 1,000 largest companies in the Russell 3000® Index. The Russell 1000® Index represents the universe of stocks from which most active money managers typically select. The Russell 1000® Index return reflects adjustments from income dividends and capital gain distributions reinvested as of the ex-dividend dates. |
| § | Annualized. |
Performance is historical and assumes reinvestment of all dividends and capital gains. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than when purchased. Past performance is not indicative of future results.
| 10 | Multi-Style Equity Fund |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
The Multi-Style Equity Fund (the “Fund”) allocates most of its assets among multiple money managers. Russell Investment Management Company (“RIMCo”), as the Fund’s advisor, may change the allocation of the Fund’s assets among money managers at any time. An exemptive order from the Securities and Exchange Commission (SEC) permits RIMCo to engage or terminate a money manager at any time, subject to the approval by the Fund’s Board without a shareholder vote. Pursuant to the terms of the exemptive order, the Fund is required to notify its shareholders within 60 days of when a money manager begins providing services. The Fund currently has eight money managers.
What is the Fund’s investment objective?
The Fund seeks to provide long term capital growth.
How did the Fund perform relative to its benchmark for the fiscal year ended December 31, 2007?
For the fiscal year ended December 31, 2007, the Multi-Style Equity Fund gained 10.36%. This compared to the Russell 1000® Index, which gained 5.77% during the same period. The Fund’s performance includes operating expenses, whereas Index returns are unmanaged and do not include expenses of any kind.
For the year ended December 31, 2007, the Lipper® Large-Cap Core Funds (VIP) Average returned 5.93%. This result serves as a peer comparison and is expressed net of operating expenses.
RIMCo may assign a money manager a specific style or capitalization benchmark other than the Fund’s index. However, the Fund’s primary index remains the benchmark for the Fund and is representative of the aggregate of each money manager’s benchmark index.
How did the market conditions described in the Market Summary report affect the Fund’s performance?
The market environment for the year favored large capitalization stocks, and companies with a growth focus. Additionally, multinational companies that export to emerging markets performed particularly well. This was a favorable environment for the Fund.
The Fund was overweight in growth stocks, large cap stocks and exporters to developing markets stocks, and underweight to utilities. This strategy emphasized companies that were believed to be sustainable growth companies on the one hand and cyclical companies with strong long-term prospects due to global demand (e.g., agriculture, infrastructure) on the other.
How did the investment strategies and techniques employed by the Fund and its money managers affect its performance?
Over the past year, the Fund maintained its overweight to companies with above-average growth rates that managers
believed were selling at attractive valuations. That positioning was rewarded in this period where growth stocks outpaced value stocks. The Fund benefited from growing global demand through its exposure to infrastructure and agriculture related stocks.
The Fund had strong stock selection in most sectors, especially the consumer discretionary, health care and financial sectors. Fund tilts toward growth stocks, beta (stocks whose price fluctuate more than the market), and momentum (stocks that show superior earnings and price performance) contributed positively as these factors were rewarded in the period. The Fund also benefited from an underweight to the financials sector and an overweight to technology, consumer staples and materials and processing sectors.
The Fund’s growth money managers, Turner Investment Partners, Inc., Montag & Caldwell, Inc. and Columbus Circle benefited from the strong growth environment as well as favorable stock selection and all outperformed both the Russell 1000 Index return of 5.8%, as well as the Russell 1000 Growth Index return of 11.8%. Value manager DePrince, Race & Zollo had a negative return for the year, but its results were within expectations given the market environment and its investment approach.
RIMCo currently employs a “select holdings” strategy for a portion of the Fund’s assets that RIMCo determines not to allocate to the money managers. Pursuant to this strategy, RIMCo analyzes the holdings of the Fund’s money managers in their Fund segments to identify particular stocks that have been selected by multiple money managers. RIMCo uses a proprietary model to rank these stocks. Based on this ranking, RIMCo purchases additional shares of certain stocks for the Fund. The strategy is designed to increase the Fund’s exposure to stocks that are viewed as attractive by multiple money managers. As the Fund outperformed for the period, the select holdings strategy also outperformed the benchmark.
At the stock selection level, the Fund benefited from overweight positions in strong performers such as Apple, Research in Motion, Google, Hess, Schlumberger and Occidental Petroleum. Overweights to US Air and AIG, and underweights to Exxon Mobil and Chevron, detracted from performance.
Describe any changes to the Fund’s structure or the money manager line-up.
In July 2007, Ark Asset Management Company, Inc. was replaced with Columbus Circle Investors. In September, Arnhold and S. Bleichroeder was added as a market-oriented manager in the Fund.
| Multi-Style Equity Fund | 11 |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Shareholder Expense Example — December 31, 2007 (Unaudited)
Fund Expenses
The following disclosure provides important information regarding each Fund’s Expense Example, which appears on each Fund’s individual page in this Annual Report. Please refer to this information when reviewing the Expense Example for a Fund.
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for this Fund is from July 1, 2007 to December 31, 2007.
Actual Expenses
The information in the table under the heading “Actual Performance” provides information about actual account values and actual expenses. You may use the information in this column, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first column in the row entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical Performance (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the information under the heading “Hypothetical Performance (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Actual Performance | Hypothetical Performance (5% return before expenses) | |||||
Beginning Account Value | ||||||
July 1, 2007 | $ | 1,000.00 | $ | 1,000.00 | ||
Ending Account Value | ||||||
December 31, 2007 | $ | 1,021.00 | $ | 1,020.77 | ||
Expenses Paid During Period* | $ | 4.48 | $ | 4.48 | ||
| * | Expenses are equal to the Fund’s annualized expense ratio of 0.88% (representing the six month period annualized), multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Reflects amounts waived and/or reimbursed by the investment adviser. Without the waiver and/or reimbursement, expenses would have been higher. |
| 12 | Multi-Style Equity Fund |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Common Stocks - 95.5% | ||||
Auto and Transportation - 1.4% | ||||
Daimler AG | 5,800 | 555 | ||
Ford Motor Co. (Æ)(Ñ) | 11,900 | 80 | ||
General Motors Corp. (Ñ) | 40,665 | 1,012 | ||
Norfolk Southern Corp. | 41,900 | 2,113 | ||
Northwest Airlines Corp. (Æ) | 14,100 | 204 | ||
Tidewater, Inc. | 6,300 | 346 | ||
TRW Automotive Holdings Corp. (Æ)(Ñ) | 6,400 | 134 | ||
UAL Corp. (Æ)(Ñ) | 25,100 | 895 | ||
Union Pacific Corp. | 5,860 | 736 | ||
United Parcel Service, Inc. Class B | 11,000 | 778 | ||
US Airways Group, Inc. (Æ)(Ñ) | 3,100 | 46 | ||
| 6,899 | ||||
Consumer Discretionary - 10.8% | ||||
Activision, Inc. (Æ) | 14,550 | 432 | ||
Amazon.Com, Inc. (Æ)(Ñ) | 21,920 | 2,031 | ||
Apollo Group, Inc. Class A (Æ) | 8,210 | 576 | ||
Avon Products, Inc. | 27,500 | 1,087 | ||
Barnes & Noble, Inc. (Ñ) | 7,600 | 262 | ||
BJ’s Wholesale Club, Inc. (Æ)(Ñ) | 9,000 | 305 | ||
Black & Decker Corp. (Ñ) | 9,600 | 669 | ||
Clear Channel Communications, Inc. (Ñ) | 2,800 | 97 | ||
Clear Channel Outdoor Holdings, Inc. Class A (Æ)(Ñ) | 80,684 | 2,232 | ||
Convergys Corp. (Æ) | 9,200 | 151 | ||
Costco Wholesale Corp. (Ñ) | 33,400 | 2,330 | ||
DreamWorks Animation SKG, Inc. Class A (Æ)(Ñ) | 3,300 | 84 | ||
eBay, Inc. (Æ) | 58,000 | 1,925 | ||
EchoStar Communications Corp. Class A (Æ)(Ñ) | 4,555 | 172 | ||
Electronic Arts, Inc. (Æ)(Ñ) | 31,540 | 1,842 | ||
Foot Locker, Inc. | 51,200 | 699 | ||
GameStop Corp. Class A (Æ)(Ñ) | 8,410 | 522 | ||
Gap, Inc. (The) | 44,800 | 953 | ||
Google, Inc. Class A (Æ) | 13,990 | 9,674 | ||
Guess?, Inc. (Ñ) | 24,860 | 942 | ||
Home Depot, Inc. | 30,800 | 830 | ||
Intercontinental Hotels Group | 30,759 | 535 | ||
International Game Technology | 20,300 | 892 | ||
JC Penney Co., Inc. | 20,100 | 884 | ||
Jones Apparel Group, Inc. (Ñ) | 29,500 | 472 | ||
Kohl’s Corp. (Æ) | 13,200 | 605 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Las Vegas Sands Corp. (Æ)(Ñ) | 6,515 | 671 | ||
Leggett & Platt, Inc. (Ñ) | 28,900 | 504 | ||
Limited Brands, Inc. (Ñ) | 49,200 | 931 | ||
McDonald’s Corp. | 85,898 | 5,060 | ||
Nike, Inc. Class B (Ñ) | 24,500 | 1,574 | ||
Nintendo Co., Ltd. - ADR (Ñ) | 6,970 | 516 | ||
OfficeMax, Inc. (Ñ) | 39,800 | 822 | ||
Phillips-Van Heusen Corp. | 11,800 | 435 | ||
RR Donnelley & Sons Co. | 18,400 | 694 | ||
Saks, Inc. (Æ)(Ñ) | 36,600 | 760 | ||
Starbucks Corp. (Æ)(Ñ) | 21,810 | 446 | ||
Target Corp. | 26,650 | 1,333 | ||
Tech Data Corp. (Æ) | 3,300 | 125 | ||
TJX Cos., Inc. | 8,900 | 256 | ||
Under Armour, Inc. Class A (Æ)(Ñ) | 9,250 | 404 | ||
VeriSign, Inc. (Æ)(Ñ) | 13,950 | 525 | ||
Viacom, Inc. Class B (Æ) | 28,400 | 1,247 | ||
Virgin Media, Inc. | 1,400 | 24 | ||
Wal-Mart Stores, Inc. (Ñ) | 41,200 | 1,958 | ||
Walt Disney Co. (The) (Ñ) | 18,600 | 600 | ||
Waste Management, Inc. | 31,000 | 1,013 | ||
Yahoo!, Inc. (Æ) | 12,800 | 298 | ||
Yum! Brands, Inc. | 11,580 | 443 | ||
| 51,842 | ||||
Consumer Staples - 8.4% | ||||
Campbell Soup Co. (Ñ) | 27,300 | 975 | ||
Clorox Co. | 16,700 | 1,088 | ||
Coca-Cola Co. (The) | 176,970 | 10,861 | ||
Colgate-Palmolive Co. | 25,740 | 2,007 | ||
ConAgra Foods, Inc. | 22,800 | 542 | ||
Diageo PLC - ADR | 5,330 | 457 | ||
Fomento Economico Mexicano SAB | 9,900 | 378 | ||
Hershey Co. (The) (Ñ) | 22,700 | 894 | ||
Kraft Foods, Inc. Class A (Ñ) | 68,900 | 2,248 | ||
Kroger Co. (The) | 17,900 | 478 | ||
McCormick & Co., Inc. (Ñ) | 16,900 | 641 | ||
Molson Coors Brewing Co. Class B (Ñ) | 20,700 | 1,069 | ||
Pepsi Bottling Group, Inc. | 2,500 | 99 | ||
PepsiCo, Inc. | 73,500 | 5,579 | ||
Procter & Gamble Co. | 124,000 | 9,104 | ||
Safeway, Inc. (Ñ) | 15,800 | 540 | ||
Sara Lee Corp. | 26,400 | 424 | ||
SUPERVALU, Inc. (Ñ) | 12,000 | 450 | ||
Unilever NV | 36,800 | 1,342 | ||
Walgreen Co. | 7,184 | 274 | ||
Wm. Wrigley Jr. Co. (Ñ) | 18,892 | 1,106 | ||
| 40,556 | ||||
| Multi-Style Equity Fund | 13 |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Financial Services - 14.2% | ||||
ACE, Ltd. (Ñ) | 33,700 | 2,082 | ||
AMB Property Corp. (ö) | 2,200 | 127 | ||
American Express Co. | 27,300 | 1,420 | ||
American International Group, Inc. (Ñ) | 103,350 | 6,025 | ||
Annaly Capital Management, Inc. (ö) | 74,800 | 1,360 | ||
AON Corp. | 15,000 | 715 | ||
Arch Capital Group, Ltd. (Æ) | 4,400 | 310 | ||
Astoria Financial Corp. | 22,600 | 526 | ||
Automatic Data Processing, Inc. | 12,300 | 548 | ||
Axis Capital Holdings, Ltd. (Ñ) | 8,100 | 316 | ||
Bank of America Corp. | 63,900 | 2,636 | ||
Bank of New York Mellon Corp. (The) | 65,526 | 3,195 | ||
BlackRock, Inc. Class A (Ñ) | 1,680 | 364 | ||
Capital One Financial Corp. (Ñ) | 25,200 | 1,191 | ||
Chubb Corp. | 6,600 | 360 | ||
Citigroup, Inc. | 82,300 | 2,423 | ||
CME Group, Inc. Class A (Ñ) | 1,330 | 912 | ||
CNA Financial Corp. (Ñ) | 7,400 | 250 | ||
Colonial BancGroup, Inc. (The) (Ñ) | 34,500 | 467 | ||
Cullen/Frost Bankers, Inc. (Ñ) | 9,700 | 491 | ||
Discover Financial Services (Ñ) | 28,900 | 436 | ||
Duke Realty Corp. (ö)(Ñ) | 15,100 | 394 | ||
Fannie Mae (Ñ) | 13,000 | 520 | ||
First Horizon National Corp. (Ñ) | 13,600 | 247 | ||
Freddie Mac (Ñ) | 10,700 | 365 | ||
Goldman Sachs Group, Inc. (The) (Ñ) | 21,330 | 4,587 | ||
H&R Block, Inc. (Ñ) | 24,900 | 462 | ||
Hartford Financial Services Group, Inc. (Ñ) | 16,700 | 1,456 | ||
Hospitality Properties Trust (ö) | 9,300 | 300 | ||
Host Hotels & Resorts, Inc. (ö) | 78,500 | 1,338 | ||
IntercontinentalExchange, Inc. (Æ) | 4,430 | 853 | ||
JPMorgan Chase & Co. (Ñ) | 186,350 | 8,134 | ||
Lehman Brothers Holdings, Inc. (Ñ) | 15,600 | 1,021 | ||
Loews Corp. | 11,700 | 589 | ||
Mack-Cali Realty Corp. (ö)(Ñ) | 9,000 | 306 | ||
Marshall & Ilsley Corp. | 23,900 | 633 | ||
Mastercard, Inc. Class A (Ñ) | 10,370 | 2,232 | ||
Mercury General Corp. (Ñ) | 19,800 | 986 | ||
MetLife, Inc. (Ñ) | 9,500 | 585 | ||
Morgan Stanley (Ñ) | 70,950 | 3,768 | ||
Nasdaq Stock Market, Inc. (The) (Æ)(Ñ) | 4,400 | 218 | ||
Northern Trust Corp. (Ñ) | 9,800 | 750 | ||
OneBeacon Insurance Group, Ltd. Class A | 1,800 | 39 | ||
Paychex, Inc. (Ñ) | 37,100 | 1,344 |
| Principal Amount ($) or Shares | Market Value $ | |||
Prologis (ö)(Ñ) | 2,700 | 171 | ||
Protective Life Corp. | 13,700 | 562 | ||
Prudential Financial, Inc. (Ñ) | 7,300 | 679 | ||
South Financial Group, Inc. (The) (Ñ) | 28,400 | 444 | ||
Sovereign Bancorp, Inc. | 35,100 | 400 | ||
SunTrust Banks, Inc. (Ñ) | 13,800 | 862 | ||
TCF Financial Corp. (Ñ) | 19,400 | 348 | ||
Transatlantic Holdings, Inc. (Ñ) | 500 | 36 | ||
Travelers Cos., Inc. (The) | 13,400 | 721 | ||
Wachovia Corp. (Ñ) | 30,700 | 1,167 | ||
Wells Fargo & Co. | 92,300 | 2,787 | ||
Western Union Co. (The) | 46,700 | 1,134 | ||
Wilmington Trust Corp. (Ñ) | 23,900 | 841 | ||
WR Berkley Corp. | 11,000 | 328 | ||
XL Capital, Ltd. Class A (Ñ) | 7,000 | 352 | ||
| 68,113 | ||||
Health Care - 14.9% | ||||
Abbott Laboratories | 36,300 | 2,038 | ||
Aetna, Inc. | 9,300 | 537 | ||
Alcon, Inc. | 6,000 | 858 | ||
Allergan, Inc. (Ñ) | 42,180 | 2,710 | ||
AMERIGROUP Corp. Class A (Æ) | 7,200 | 262 | ||
Baxter International, Inc. | 15,280 | 887 | ||
Beckman Coulter, Inc. (Ñ) | 500 | 36 | ||
Boston Scientific Corp. (Æ) | 41,200 | 479 | ||
Bristol-Myers Squibb Co. | 87,700 | 2,326 | ||
Cardinal Health, Inc. | 21,400 | 1,236 | ||
Celgene Corp. (Æ)(Ñ) | 2,800 | 129 | ||
Charles River Laboratories International, Inc. (Æ)(Ñ) | 5,940 | 391 | ||
Community Health Systems, Inc. (Æ)(Ñ) | 16,500 | 608 | ||
Cooper Cos., Inc. (The) (Ñ) | 11,300 | 429 | ||
Covidien, Ltd. | 34,500 | 1,528 | ||
CVS Caremark Corp. | 175,900 | 6,992 | ||
Dentsply International, Inc. | 7,720 | 348 | ||
Eli Lilly & Co. | 21,400 | 1,143 | ||
Express Scripts, Inc. Class A (Æ) | 15,900 | 1,161 | ||
Genzyme Corp. (Æ) | 8,590 | 639 | ||
Gilead Sciences, Inc. (Æ)(Ñ) | 117,020 | 5,384 | ||
Human Genome Sciences, Inc. (Æ)(Ñ) | 71,800 | 750 | ||
Intuitive Surgical, Inc. (Æ)(Ñ) | 6,890 | 2,236 | ||
Johnson & Johnson | 55,600 | 3,709 | ||
King Pharmaceuticals, Inc. (Æ)(Ñ) | 26,700 | 273 | ||
McKesson Corp. | 7,800 | 511 | ||
Medco Health Solutions, Inc. (Æ) | 21,120 | 2,142 | ||
Merck & Co., Inc. | 159,011 | 9,240 | ||
| 14 | Multi-Style Equity Fund |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Millennium Pharmaceuticals, Inc. (Æ)(Ñ) | 40,400 | 605 | ||
Mylan, Inc. (Ñ) | 46,500 | 654 | ||
Myriad Genetics, Inc. (Æ)(Ñ) | 6,800 | 316 | ||
Novartis AG - ADR | 50,350 | 2,734 | ||
Pfizer, Inc. | 120,600 | 2,741 | ||
Schering-Plough Corp. | 113,600 | 3,026 | ||
Shire PLC - ADR (Ñ) | 7,550 | 521 | ||
St. Jude Medical, Inc. (Æ)(Ñ) | 23,037 | 936 | ||
Stericycle, Inc. (Æ) | 4,470 | 266 | ||
Stryker Corp. | 28,100 | 2,100 | ||
Teva Pharmaceutical Industries, Ltd. - ADR | 20,100 | 934 | ||
Thermo Fisher Scientific, Inc. (Æ)(Ñ) | 72,420 | 4,177 | ||
Wyeth | 79,682 | 3,521 | ||
| 71,513 | ||||
Integrated Oils - 6.2% | ||||
Chevron Corp. | 35,600 | 3,323 | ||
ConocoPhillips | 20,100 | 1,775 | ||
Exxon Mobil Corp. | 89,400 | 8,376 | ||
Hess Corp. (Ñ) | 31,200 | 3,147 | ||
Marathon Oil Corp. | 38,400 | 2,337 | ||
Occidental Petroleum Corp. (Ñ) | 101,600 | 7,822 | ||
Total SA - ADR | 33,650 | 2,779 | ||
| 29,559 | ||||
Materials and Processing - 6.5% | ||||
Agrium, Inc. | 22,400 | 1,617 | ||
Alcoa, Inc. | 15,500 | 567 | ||
Archer-Daniels-Midland Co. | 24,490 | 1,137 | ||
Ashland, Inc. (Ñ) | 29,400 | 1,394 | ||
Avery Dennison Corp. | 12,800 | 680 | ||
Bemis Co., Inc. (Ñ) | 21,200 | 580 | ||
Bunge, Ltd. | 6,820 | 794 | ||
Cabot Corp. | 17,700 | 590 | ||
Chicago Bridge & Iron Co. NV | 8,300 | 502 | ||
Commercial Metals Co. (Ñ) | 7,100 | 209 | ||
Cytec Industries, Inc. | 9,700 | 597 | ||
Dow Chemical Co. (The) | 12,800 | 505 | ||
EI Du Pont de Nemours & Co. (Ñ) | 83,000 | 3,659 | ||
EMCOR Group, Inc. (Æ) | 9,600 | 227 | ||
Freeport-McMoRan Copper & Gold, Inc. Class B | 11,400 | 1,168 | ||
International Paper Co. (Ñ) | 52,000 | 1,684 | ||
KBR, Inc. (Æ)(Ñ) | 5,400 | 210 | ||
Lubrizol Corp. | 800 | 43 | ||
Masco Corp. (Ñ) | 79,950 | 1,728 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Monsanto Co. | 42,770 | 4,777 | ||
Mosaic Co. (The) (Æ) | 4,570 | 431 | ||
Nalco Holding Co. (Ñ) | 9,300 | 225 | ||
Newmont Mining Corp. | 3,600 | 176 | ||
Nucor Corp. (Ñ) | 13,500 | 799 | ||
Perini Corp. (Æ)(Ñ) | 4,000 | 166 | ||
Potash Corp. of Saskatchewan | 8,800 | 1,267 | ||
PPG Industries, Inc. | 8,600 | 604 | ||
Rohm & Haas Co. (Ñ) | 45,600 | 2,420 | ||
RPM International, Inc. | 33,400 | 678 | ||
Sonoco Products Co. | 22,800 | 745 | ||
Timken Co. | 17,500 | 575 | ||
USEC, Inc. (Æ)(Ñ) | 10,900 | 98 | ||
Valspar Corp. (Ñ) | 23,300 | 525 | ||
| 31,377 | ||||
Miscellaneous - 3.7% | ||||
3M Co. | 15,578 | 1,314 | ||
ABB, Ltd. - ADR | 28,350 | 816 | ||
Brunswick Corp. (Ñ) | 31,400 | 535 | ||
General Electric Co. | 322,700 | 11,963 | ||
Textron, Inc. | 41,600 | 2,966 | ||
Tyco International, Ltd. | 3,700 | 147 | ||
| 17,741 | ||||
Other Energy - 4.9% | ||||
Baker Hughes, Inc. | 22,600 | 1,833 | ||
Cameron International Corp. (Æ)(Ñ) | 33,860 | 1,630 | ||
Consol Energy, Inc. | 13,080 | 936 | ||
Continental Resources, Inc. (Æ)(Ñ) | 4,100 | 107 | ||
Devon Energy Corp. (Ñ) | 40,967 | 3,642 | ||
Diamond Offshore Drilling, Inc. (Ñ) | 5,310 | 754 | ||
Frontier Oil Corp. (Ñ) | 5,900 | 239 | ||
Halliburton Co. (Ñ) | 46,900 | 1,778 | ||
National Oilwell Varco, Inc. (Æ) | 15,300 | 1,124 | ||
Patterson - UTI Energy, Inc. (Ñ) | 7,900 | 154 | ||
Schlumberger, Ltd. | 52,100 | 5,125 | ||
Sunoco, Inc. | 13,000 | 942 | ||
Valero Energy Corp. | 8,500 | 595 | ||
Western Refining, Inc. (Ñ) | 1,800 | 44 | ||
Williams Cos., Inc. | 40,555 | 1,451 | ||
XTO Energy, Inc. (Ñ) | 59,850 | 3,074 | ||
| 23,428 | ||||
Producer Durables - 4.4% | ||||
Applied Materials, Inc. | 115,170 | 2,045 | ||
Deere & Co. (Ñ) | 26,780 | 2,494 | ||
Diebold, Inc. | 16,600 | 481 | ||
| Multi-Style Equity Fund | 15 |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Dover Corp. | 23,700 | 1,092 | ||
DR Horton, Inc. (Ñ) | 17,500 | 230 | ||
Emerson Electric Co. | 63,900 | 3,621 | ||
Gardner Denver, Inc. (Æ) | 3,900 | 129 | ||
Graco, Inc. (Ñ) | 15,300 | 570 | ||
KB Home (Ñ) | 10,600 | 229 | ||
Lexmark International, Inc. Class A (Æ)(Ñ) | 6,500 | 227 | ||
Molex, Inc. (Ñ) | 22,500 | 614 | ||
Nokia OYJ - ADR | 41,800 | 1,605 | ||
Northrop Grumman Corp. | 7,200 | 566 | ||
Parker Hannifin Corp. (Ñ) | 20,382 | 1,535 | ||
Pentair, Inc. | 22,700 | 790 | ||
Raytheon Co. (Ñ) | 28,126 | 1,707 | ||
Roper Industries, Inc. (Ñ) | 6,730 | 421 | ||
Steelcase, Inc. Class A (Ñ) | 7,600 | 121 | ||
United Technologies Corp. | 22,404 | 1,715 | ||
Varian Semiconductor Equipment Associates, Inc. (Æ)(Ñ) | 9,050 | 335 | ||
Waters Corp. (Æ) | 5,540 | 438 | ||
| 20,965 | ||||
Technology - 16.1% | ||||
Advanced Micro Devices, Inc. (Æ)(Ñ) | 21,800 | 163 | ||
Amphenol Corp. Class A (Ñ) | 57,766 | 2,679 | ||
Analog Devices, Inc. (Ñ) | 52,497 | 1,664 | ||
Apple, Inc. (Æ) | 44,910 | 8,896 | ||
Applera Corp. - Applied Biosystems Group | 23,200 | 787 | ||
AU Optronics Corp. - ADR | 1 | — | ||
Broadcom Corp. Class A (Æ)(Ñ) | 16,900 | 442 | ||
Cisco Systems, Inc. (Æ) | 339,440 | 9,189 | ||
Citrix Systems, Inc. (Æ) | 8,320 | 316 | ||
Computer Sciences Corp. (Æ)(Ñ) | 9,200 | 455 | ||
Corning, Inc. 2008 | 39,300 | 943 | ||
Dell, Inc. (Æ)(Ñ) | 46,800 | 1,147 | ||
Electronic Data Systems Corp. | 18,600 | 386 | ||
EMC Corp. (Æ) | 42,500 | 788 | ||
First Solar, Inc. (Æ)(Ñ) | 2,400 | 641 | ||
Garmin, Ltd. (Ñ) | 10,400 | 1,009 | ||
General Dynamics Corp. | 6,100 | 543 | ||
Hewlett-Packard Co. | 121,900 | 6,153 | ||
Intel Corp. | 269,300 | 7,180 | ||
International Business Machines Corp. | 10,100 | 1,092 | ||
Juniper Networks, Inc. (Æ)(Ñ) | 44,640 | 1,482 | ||
Linear Technology Corp. (Ñ) | 10,500 | 334 | ||
LSI Corp. (Æ)(Ñ) | 19,500 | 104 | ||
Maxim Integrated Products, Inc. (Ñ) | 84,400 | 2,235 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
MEMC Electronic Materials, Inc. (Æ) | 15,100 | 1,336 | ||
Microsoft Corp. | 227,879 | 8,112 | ||
Motorola, Inc. | 147,000 | 2,358 | ||
Nvidia Corp. (Ñ) | 24,300 | 827 | ||
Qualcomm, Inc. | 91,500 | 3,600 | ||
Research In Motion, Ltd. (Æ) | 24,795 | 2,812 | ||
Salesforce.com, Inc. (Æ)(Ñ) | 5,970 | 374 | ||
Sanmina-SCI Corp. (Æ) | 46,400 | 84 | ||
Seagate Technology | 24,320 | 620 | ||
Seagate Technology, Inc. (Æ) | 2,300 | — | ||
Sun Microsystems, Inc. (Æ) | 27,125 | 492 | ||
Sunpower Corp. Class A (Æ)(Ñ) | 6,280 | 819 | ||
Taiwan Semiconductor Manufacturing Co., Ltd. - ADR | 102,334 | 1,019 | ||
Texas Instruments, Inc. | 55,450 | 1,852 | ||
Tyco Electronics, Ltd. | 96,933 | 3,599 | ||
Unisys Corp. (Æ)(Ñ) | 7,200 | 34 | ||
VMware, Inc. Class A (Æ)(Ñ) | 4,400 | 374 | ||
Western Digital Corp. (Æ)(Ñ) | 7,100 | 214 | ||
| 77,154 | ||||
Utilities - 4.0% | ||||
AGL Resources, Inc. | 10,500 | 395 | ||
Alliant Energy Corp. (Ñ) | 6,800 | 277 | ||
Aqua America, Inc. (Ñ) | 31,800 | 674 | ||
AT&T, Inc. | 139,011 | 5,777 | ||
Citizens Communications Co. (Ñ) | 63,300 | 806 | ||
Edison International (Ñ) | 9,600 | 512 | ||
Embarq Corp. | 5,900 | 292 | ||
NiSource, Inc. (Ñ) | 23,300 | 440 | ||
Pepco Holdings, Inc. | 21,300 | 625 | ||
PG&E Corp. (Ñ) | 8,100 | 349 | ||
Progress Energy, Inc. - CVO | 1,300 | — | ||
Public Service Enterprise Group, Inc. | 500 | 49 | ||
SCANA Corp. | 7,800 | 329 | ||
TECO Energy, Inc. (Ñ) | 21,100 | 363 | ||
Telephone & Data Systems, Inc. | 1,400 | 88 | ||
Verizon Communications, Inc. (Ñ) | 93,500 | 4,085 | ||
Vimpel-Communications - ADR | 25,000 | 1,040 | ||
Vodafone Group PLC - ADR | 56,750 | 2,118 | ||
Windstream Corp. (Ñ) | 61,900 | 806 | ||
| 19,025 | ||||
| Total Common Stocks | ||||
(cost $411,021) | 458,172 | |||
| 16 | Multi-Style Equity Fund |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | ||||
Short-Term Investments - 4.5% | |||||
Russell Investment Company Money Market Fund | 20,640,000 | 20,640 | |||
United States Treasury Bills (ž)(§) | |||||
2.962% due 03/20/08 | 1,200 | 1,191 | |||
| Total Short-Term Investments | |||||
(cost $21,832) | 21,831 | ||||
| Other Securities - 23.0% | |||||
State Street Securities Lending Quality Trust (×) | 110,488,585 | 110,489 | |||
| Total Other Securities | |||||
(cost $110,489) | 110,489 | ||||
| Total Investments - 123.0% | |||||
(identified cost $543,342) | 590,492 | ||||
| Other Assets and Liabilities, Net - (23.0%) | (110,570 | ) | |||
| Net Assets - 100.0% | 479,922 | ||||
See accompanying notes which are an integral part of the financial statements.
| Multi-Style Equity Fund | 17 |
Table of Contents
Russell Investment Funds
Multi-Style Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Futures Contracts (Number of Contracts) | Notional Amount | Unrealized Appreciation (Depreciation) $ | ||||
Long Positions | ||||||
Russell 1000 Index expiration date 03/08 (7) | USD | 2,818 | (29 | ) | ||
S&P 500 E-Mini Index (CME) expiration date 03/08 (50) | USD | 3,693 | (53 | ) | ||
S&P 500 Index (CME) | USD | 2,954 | (40 | ) | ||
S&P Midcap 400 E-Mini Index (CME) | USD | 11,934 | (176 | ) | ||
Total Unrealized Appreciation (Depreciation) on Open Futures Contracts | (298 | ) | ||||
Presentation of Portfolio Holdings — December 31, 2007
| Portfolio Summary | % of Net Assets | ||
Auto and Transportation | 1.4 | ||
Consumer Discretionary | 10.8 | ||
Consumer Staples | 8.4 | ||
Financial Services | 14.2 | ||
Health Care | 14.9 | ||
Integrated Oils | 6.2 | ||
Materials and Processing | 6.5 | ||
Miscellaneous | 3.7 | ||
Other Energy | 4.9 | ||
Producer Durables | 4.4 | ||
Technology | 16.1 | ||
Utilities | 4.0 | ||
Short-Term Investments | 4.5 | ||
Other Securities | 23.0 | ||
Total Investments | 123.0 | ||
Other Assets and Liabilities, Net | (23.0 | ) | |
| 100.0 | |||
Futures Contracts | (0.1 | ) | |
See accompanying notes which are an integral part of the financial statements.
| 18 | Multi-Style Equity Fund |
Table of Contents
(This page intentionally left blank)
Table of Contents
Russell Investment Funds
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
| Aggressive Equity Fund | |||
| Total Return | |||
1 Year | 3.42 | % | |
5 Years | 16.10 | %§ | |
10 Years | 5.90 | %§ | |
| Russell 2500™ Index ** | |||
| Total Return | |||
1 Year | 1.38 | % | |
5 Years | 16.99 | %§ | |
10 Years | 9.01 | %§ | |
| * | Assumes initial investment on January 1, 1998. |
** | Russell 2500™ Index is composed of the bottom 500 stocks the Russell 1000® Index and all the stocks in the Russell 2000® Index. The Russell 2500™ Index return reflects adjustments for income dividends and capital gains distributions reinvested as of the ex-dividend dates. |
| § | Annualized. |
Performance is historical and assumes reinvestment of all dividends and capital gains. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than when purchased. Past performance is not indicative of future results.
| 20 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
The Aggressive Equity Fund (the “Fund”) allocates most of its assets among multiple money managers. Russell Investment Management Company (“RIMCo”), as the Fund’s advisor, may change the allocation of the Fund’s assets among money managers at any time. An exemptive order from the Securities and Exchange Commission (SEC) permits RIMCo to engage or terminate a money manager at any time, subject to the approval by the Fund’s Board without a shareholder vote. Pursuant to the terms of the exemptive order, the Fund is required to notify its shareholders within 60 days of when a money manager begins providing services. The Fund currently has eight money managers.
What is the Fund’s investment objective?
The Fund seeks to provide long term capital growth.
How did the Fund perform relative to its benchmark for the fiscal year ended December 31, 2007?
For the fiscal year ended December 31, 2007, the Aggressive Equity Fund gained 3.42%. This compared to the Russell 2500™ Index, which gained 1.38% during the same period. The Fund’s performance includes operating expenses, whereas Index returns are unmanaged and do not include expenses of any kind.
For the year ended December 31, 2007, the Lipper® Small-Cap Core Funds (VIP) Average returned -1.64%. This result serves as a peer comparison and is expressed net of operating expenses.
How did the market conditions described in the Market Summary report affect the Fund’s performance?
The switch from value leadership to growth leadership helped the Fund during the year as the Fund was overweight stocks with higher estimated earnings. Additionally, the Fund was underweight deeper value stocks.
Throughout the year, stock selection in consumer discretionary and financial services was additive. Stock returns within these sectors were extremely volatile depending on their exposure to subprime mortgages and housing. This presented a positive environment for active managers to outperform based on stock selection.
Additionally, exposure to U.S. companies with non-U.S. sales tended to help managers particularly as the U.S. dollar fell and investors began to question the strength of the U.S. consumer. Managers also benefited by being underweight sectors with exposure to housing or credit risk. Engineering, solar energy, and chemicals companies held by the Fund contributed positively to performance.
How did the investment strategies and techniques employed by the Fund and its money managers affect its performance?
The Fund outperformed its Index for the year. Returns were largely driven by stock selection in the consumer discretionary sector as well as an underweight to financial services. The high growth and high valuation stocks performed best.
Gould Investment Partners LLC and Tygh Capital Management, Inc. were the best performing managers in the Fund. Gould’s outperformance was driven largely by stock selection in the consumer discretionary sector. Additionally, Gould’s stock selection in producer durables, technology, and other energy were additive. The largest contributor at the stock level was Crocs, which was up 70.42% for the year and consistently one of Gould’s largest holdings. Solar stocks (Suntech Power Holdings, SunPower Corp, JA Solar Holdings, First Solar) were a major source of Gould’s returns throughout the year. Gould benefited significantly by investing in high-growth stocks regardless of valuations, both factors that were rewarded significantly throughout most of the year.
Tygh benefited from stock selection in the consumer discretionary and technology sectors in addition to strong stock selection in industrial stocks such as McDermott International and Foster Wheeler. The consumer discretionary sector was led by an overweight in aQuantive, which was up significantly. Consumer discretionary companies that focused on home entertainment systems led the sector. Tygh benefited significantly from not being overly valuation sensitive, as valuation metrics underperformed during the year due to the shift from value leadership to growth leadership.
PanAgora Asset Management, Inc. and Jacobs Levy Equity Management, Inc. underperformed the Fund’s benchmark. Exposure to ten of the twelve economic sectors negatively contributed to performance. Stock selection in financial services, consumer discretionary, and health care sectors was the largest detractor. PanAgora’s exposure to valuation factors was a detriment, as these factors went largely unrewarded in the market as growth began to outperform value. Additionally, selection of lower market capitalization securities detracted from performance.
Jacobs Levy’s underperformance was due to its overweight in the consumer discretionary sector, a combination of its underweight and weak stock selection in the other energy sector, and its underweight in the utilities sector. Additionally, Jacob Levy’s weak stock selection in the technology sector detracted from performance.
| Aggressive Equity Fund | 21 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
Describe any changes to the Fund’s structure or the money manager line-up.
In March 2007, DePrince, Race & Zollo, Inc. was hired to replace Geewax, Terker & Company and Nicholas-Applegate Capital Management, LLC. Also in March, pursuant to an asset purchase agreement with CapitalWorks Investment Partners, LLC, the CapitalWorks investment team became Berkeley Capital Management, LLP. In September of 2007, Berkeley was replaced with Ranger Investment Management, LP.
| Money Managers as of December 31, 2007 | Styles | |
ClariVest Asset Management LLC | Market-Oriented | |
David J. Greene and Company, LLC | Value | |
DePrince, Race & Zollo, Inc. | Value | |
Gould Investment Partners LLC | Growth | |
Jacobs Levy Equity Management, Inc. | Value | |
PanAgora Asset Management, Inc. | Market-Oriented | |
Ranger Investment Management, L.P. | Growth | |
Tygh Capital Management, Inc. | Growth | |
The views expressed in this report reflect those of the portfolio managers only through the end of the period covered by the report. These views do not necessarily represent the views of Russell Investment Management Company (RIMCo), or any other person in RIMCo or any other affiliated organization. These views are subject to change at any time based upon market conditions or other events, and RIMCo disclaims any responsibility to update the views contained herein. These views should not be relied on as investment advice and, because investment decisions for Russell Investment Funds (RIF) are based on numerous factors, should not be relied on as an indication of investment decisions of any RIF Fund.
| 22 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Shareholder Expense Example — December 31, 2007 (Unaudited)
Fund Expenses
The following disclosure provides important information regarding each Fund’s Expense Example, which appears on each Fund’s individual page in this Annual Report. Please refer to this information when reviewing the Expense Example for a Fund.
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for this Fund is from July 1, 2007 to December 31, 2007.
Actual Expenses
The information in the table under the heading “Actual Performance” provides information about actual account values and actual expenses. You may use the information in this column, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first column in the row entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical Performance (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the information under the heading “Hypothetical Performance (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Actual Performance | Hypothetical Performance (5% return before expenses) | |||||
Beginning Account Value | ||||||
July 1, 2007 | $ | 1,000.00 | $ | 1,000.00 | ||
Ending Account Value | ||||||
December 31, 2007 | $ | 953.90 | $ | 1,019.91 | ||
Expenses Paid During Period* | $ | 5.17 | $ | 5.35 | ||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.05% (representing the six month period annualized), multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Reflects amounts waived and/or reimbursed by the investment adviser. Without the waiver and/or reimbursement, expenses would have been higher. |
| Aggressive Equity Fund | 23 |
Table of Contents
Russell Investment Funds
Schedule of Investments — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Common Stocks - 96.3% | ||||
Auto and Transportation - 2.7% | ||||
AAR Corp. (Æ)(Ñ) | 24,492 | 931 | ||
ABX Holdings, Inc. (Æ)(Ñ) | 100 | — | ||
Accuride Corp. (Æ) | 248 | 2 | ||
Aftermarket Technology Corp. (Æ) | 6,800 | 185 | ||
Alaska Air Group, Inc. (Æ)(Ñ) | 5,200 | 130 | ||
Allegiant Travel Co. (Æ)(Ñ) | 5,000 | 161 | ||
Amerigon, Inc. (Æ)(Ñ) | 9,300 | 197 | ||
Autoliv, Inc. | 55 | 3 | ||
BorgWarner, Inc. | 18 | 1 | ||
Con-way, Inc. (Ñ) | 6,000 | 249 | ||
Continental Airlines, Inc. Class A (Æ) | 9,778 | 218 | ||
Dana Corp. (Æ)(Ñ) | 47,300 | 1 | ||
Danaos Corp. | 4,200 | 111 | ||
Double Hull Tankers, Inc. (Ñ) | 15,000 | 184 | ||
Expeditors International of Washington, Inc. (Ñ) | 6,801 | 304 | ||
Genco Shipping & Trading, Ltd. (Ñ) | 1,800 | 99 | ||
Hub Group, Inc. Class A (Æ) | 11,515 | 306 | ||
Kansas City Southern (Æ)(Ñ) | 5,700 | 196 | ||
Kirby Corp. (Æ)(Ñ) | 8,651 | 402 | ||
Lear Corp. (Æ) | 4,600 | 127 | ||
Modine Manufacturing Co. (Ñ) | 6,900 | 114 | ||
Navistar International Corp. (Æ)(Ñ) | 2,000 | 108 | ||
Northwest Airlines Corp. (Æ) | 9,600 | 139 | ||
Overseas Shipholding Group, Inc. | 2,900 | 216 | ||
Skywest, Inc. (Ñ) | 5,974 | 160 | ||
Standard Motor Products, Inc. | 3,312 | 27 | ||
Stoneridge, Inc. (Æ)(Ñ) | 1,600 | 13 | ||
TBS International, Ltd. Class A (Æ)(Ñ) | 600 | 20 | ||
Tidewater, Inc. | 323 | 18 | ||
TRW Automotive Holdings Corp. (Æ)(Ñ) | 11,200 | 234 | ||
UAL Corp. (Æ) | 4,478 | 160 | ||
US Airways Group, Inc. (Æ)(Ñ) | 13,000 | 191 | ||
UTI Worldwide, Inc. (Ñ) | 11,708 | 229 | ||
Visteon Corp. (Æ)(Ñ) | 9,700 | 43 | ||
Wabtec Corp. (Ñ) | 20,300 | 699 | ||
| 6,178 | ||||
Consumer Discretionary - 14.6% | ||||
Abercrombie & Fitch Co. Class A | 6,970 | 557 | ||
ABM Industries, Inc. (Ñ) | 3,500 | 71 | ||
Activision, Inc. (Æ) | 45,968 | 1,365 | ||
Administaff, Inc. | 1,791 | 51 | ||
Advance Auto Parts, Inc. (Ñ) | 4,800 | 182 | ||
Advisory Board Co. (The) (Æ)(Ñ) | 7,569 | 486 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
AFC Enterprises (Æ)(Ñ) | 5,000 | 57 | ||
Alberto-Culver Co. Class B | 12,700 | 312 | ||
American Woodmark Corp. | 6,145 | 112 | ||
Ameristar Casinos, Inc. (Ñ) | 17,200 | 474 | ||
Apollo Group, Inc. Class A (Æ) | 5,799 | 407 | ||
Asbury Automotive Group, Inc. (Ñ) | 4,100 | 62 | ||
AutoNation, Inc. (Æ)(Ñ) | 19,000 | 298 | ||
Bally Technologies, Inc. (Æ)(Ñ) | 18,388 | 914 | ||
Barnes & Noble, Inc. | 9,300 | 320 | ||
Big Lots, Inc. (Æ) | 11,019 | 176 | ||
BJ’s Wholesale Club, Inc. (Æ)(Ñ) | 17,000 | 575 | ||
Black & Decker Corp. | 3,058 | 213 | ||
Blockbuster, Inc. Class A (Æ) | 27,999 | 109 | ||
Blyth, Inc. (Ñ) | 6,200 | 136 | ||
Bob Evans Farms, Inc. | 1,819 | 49 | ||
Books-A-Million, Inc. Class A | 437 | 5 | ||
Borders Group, Inc. (Ñ) | 24,634 | 262 | ||
Brightpoint, Inc. (Æ)(Ñ) | 22,400 | 344 | ||
Brown Shoe Co., Inc. (Ñ) | 9,900 | 150 | ||
Buckle, Inc. (The) | 4,600 | 152 | ||
Capella Education Co. (Æ)(Ñ) | 500 | 33 | ||
Carter’s, Inc. (Æ)(Ñ) | 4,400 | 85 | ||
CBRL Group, Inc. | 6,879 | 223 | ||
CDI Corp. (Ñ) | 2,100 | 51 | ||
Chemed Corp. (Ñ) | 11,286 | 631 | ||
Chipotle Mexican Grill, Inc. Class A (Æ)(Ñ) | 3,700 | 544 | ||
Churchill Downs, Inc. (Ñ) | 4,700 | 254 | ||
CMGI, Inc. (Æ)(Ñ) | 13,980 | 183 | ||
Convergys Corp. (Æ) | 41,552 | 684 | ||
Corinthian Colleges, Inc. (Æ)(Ñ) | 15,100 | 233 | ||
Corrections Corp. of America (Æ)(Ñ) | 9,800 | 289 | ||
CROCS, Inc. (Æ)(Ñ) | 10,500 | 387 | ||
CSS Industries, Inc. (Ñ) | 1,500 | 55 | ||
Denny’s Corp. (Æ) | 12,278 | 46 | ||
DeVry, Inc. | 2,471 | 128 | ||
Discovery Holding Co. Class A (Æ)(Ñ) | 6,700 | 168 | ||
Dolby Laboratories, Inc. Class A (Æ) | 12,600 | 626 | ||
Dollar Tree Stores, Inc. (Æ) | 16,259 | 421 | ||
DreamWorks Animation SKG, Inc. Class A (Æ)(Ñ) | 13,956 | 356 | ||
DynCorp International, Inc. Class A (Æ)(Ñ) | 8,200 | 220 | ||
Earthlink, Inc. (Æ)(Ñ) | 37,900 | 268 | ||
Electronic Arts, Inc. (Æ)(Ñ) | 8,964 | 524 | ||
Family Dollar Stores, Inc. | 268 | 5 | ||
Focus Media Holding, Ltd. - ADR (Æ)(Ñ) | 8,600 | 489 | ||
FTD Group, Inc. (Ñ) | 22,600 | 291 |
| 24 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
FTI Consulting, Inc. (Æ)(Ñ) | 12,300 | 758 | ||
Gaiam, Inc. Class A (Æ)(Ñ) | 10,900 | 324 | ||
GameStop Corp. Class A (Æ)(Ñ) | 5,799 | 360 | ||
Gaylord Entertainment Co. (Æ)(Ñ) | 4,900 | 198 | ||
Geo Group, Inc. (The) (Æ)(Ñ) | 21,722 | 608 | ||
Gray Television, Inc. (Ñ) | 34,500 | 277 | ||
Great Lakes Dredge & Dock Co. | 2,300 | 20 | ||
Greenfield Online, Inc. (Æ) | 7,127 | 104 | ||
Group 1 Automotive, Inc. (Ñ) | 5,200 | 124 | ||
Harris Interactive, Inc. (Æ)(Ñ) | 5,100 | 22 | ||
Hasbro, Inc. (Ñ) | 22,470 | 575 | ||
Hertz Global Holdings, Inc. (Æ)(Ñ) | 9,700 | 154 | ||
Hewitt Associates, Inc. Class A (Æ) | 17,134 | 656 | ||
Hooker Furniture Corp. (Ñ) | 1,000 | 20 | ||
ICF International, Inc. (Æ)(Ñ) | 7,300 | 184 | ||
IHOP Corp. | 2,522 | 92 | ||
IKON Office Solutions, Inc. | 3,662 | 48 | ||
Infospace, Inc. | 6,100 | 115 | ||
infoUSA, Inc. (Ñ) | 21,671 | 194 | ||
Insight Enterprises, Inc. (Æ)(Ñ) | 1,000 | 18 | ||
International Speedway Corp. Class A | 4,600 | 189 | ||
inVentiv Health, Inc. (Æ)(Ñ) | 12,600 | 390 | ||
Jack in the Box, Inc. (Æ) | 7,900 | 204 | ||
Jakks Pacific, Inc. (Æ)(Ñ) | 6,600 | 156 | ||
Jo-Ann Stores, Inc. (Æ) | 7,836 | 103 | ||
Journal Communications, Inc. Class A (Ñ) | 8,000 | 72 | ||
Kelly Services, Inc. Class A (Ñ) | 3,400 | 63 | ||
Kenneth Cole Productions, Inc. Class A (Ñ) | 2,700 | 47 | ||
Leapfrog Enterprises, Inc. Class A (Æ)(Ñ) | 5,800 | 39 | ||
Learning Tree International, Inc. (Æ) | 8,666 | 199 | ||
LECG Corp. (Æ) | 102 | 2 | ||
Lin TV Corp. Class A (Æ)(Ñ) | 5,600 | 68 | ||
LKQ Corp. (Æ) | 15,690 | 330 | ||
Maidenform Brands, Inc. (Æ)(Ñ) | 2,500 | 34 | ||
MAXIMUS, Inc. | 2,589 | 100 | ||
Meredith Corp. (Ñ) | 2,600 | 143 | ||
Mohawk Industries, Inc. (Æ) | 1,287 | 96 | ||
MSC Industrial Direct Co. Class A (Ñ) | 4,654 | 188 | ||
Net 1 UEPS Technologies, Inc. (Æ) | 4,170 | 122 | ||
New Oriental Education & Technology Group - ADR (Æ) | 5,400 | 435 | ||
Nu Skin Enterprises, Inc. Class A (Ñ) | 4,300 | 71 | ||
O’Charleys, Inc. (Ñ) | 18,594 | 279 | ||
O’Reilly Automotive, Inc. (Æ)(Ñ) | 14,191 | 460 | ||
Orient-Express Hotels, Ltd. Class A (Ñ) | 7,362 | 423 |
| Principal Amount ($) or Shares | Market Value $ | |||
Overstock.com, Inc. (Æ) | 2,887 | 45 | ||
Papa John’s International, Inc. (Æ)(Ñ) | 5,400 | 123 | ||
PC Connection, Inc. (Æ)(Ñ) | 2,800 | 32 | ||
Perficient, Inc. (Æ)(Ñ) | 39,900 | 628 | ||
Perry Ellis International, Inc. (Æ)(Ñ) | 8,776 | 135 | ||
Phillips-Van Heusen Corp. (Ñ) | 10,000 | 369 | ||
Pier 1 Imports, Inc. (Æ)(Ñ) | 31,600 | 165 | ||
Prestige Brands Holdings, Inc. (Æ) | 2,010 | 15 | ||
Quiksilver, Inc. (Æ)(Ñ) | 26,900 | 231 | ||
RadioShack Corp. | 12,112 | 204 | ||
Red Robin Gourmet Burgers, Inc. (Æ) | 1,748 | 56 | ||
Rent-A-Center, Inc. Class A (Æ) | 3,300 | 48 | ||
Republic Services, Inc. Class A | 23,689 | 743 | ||
Revlon, Inc. Class A (Æ)(Ñ) | 11,100 | 13 | ||
Rush Enterprises, Inc. Class A (Æ) | 2,295 | 42 | ||
Scholastic Corp. (Æ)(Ñ) | 11,290 | 394 | ||
Service Corp. International (Ñ) | 12,400 | 174 | ||
Shanda Interactive Entertainment, Ltd. - ADR (Æ)(Ñ) | 9,600 | 320 | ||
Sinclair Broadcast Group, Inc. Class A (Ñ) | 27,581 | 226 | ||
Sohu.com, Inc. (Æ)(Ñ) | 1,900 | 104 | ||
Sonic Automotive, Inc. Class A (Ñ) | 5,800 | 112 | ||
Source Interlink Cos., Inc. (Æ)(Ñ) | 11,200 | 32 | ||
Spectrum Brands, Inc. (Æ)(Ñ) | 7,500 | 40 | ||
Speedway Motorsports, Inc. (Ñ) | 1,400 | 44 | ||
Spherion Corp. (Æ)(Ñ) | 28,200 | 205 | ||
Stewart Enterprises, Inc. Class A (Ñ) | 30,300 | 270 | ||
Strayer Education, Inc. (Ñ) | 1,800 | 307 | ||
Tech Data Corp. (Æ) | 8,045 | 303 | ||
Tiffany & Co. | 4,115 | 189 | ||
Toro Co. (Ñ) | 1,700 | 93 | ||
United Natural Foods, Inc. (Æ)(Ñ) | 14,450 | 458 | ||
United Online, Inc. (Ñ) | 55,200 | 652 | ||
United Stationers, Inc. (Æ)(Ñ) | 3,400 | 157 | ||
Urban Outfitters, Inc. (Æ)(Ñ) | 24,940 | 680 | ||
VeriSign, Inc. (Æ)(Ñ) | 18,130 | 682 | ||
Volcom, Inc. (Æ)(Ñ) | 9,600 | 211 | ||
Volt Information Sciences, Inc. (Æ) | 2,200 | 40 | ||
Warnaco Group, Inc. (The) (Æ)(Ñ) | 8,300 | 289 | ||
Warner Music Group Corp. (Ñ) | 24,600 | 149 | ||
West Marine, Inc. (Æ)(Ñ) | 5,534 | 50 | ||
Westwood One, Inc. (Ñ) | 17,200 | 34 | ||
World Wrestling Entertainment, Inc. Class A (Ñ) | 14,300 | 211 | ||
| 33,372 | ||||
Consumer Staples - 2.4% | ||||
Alliance One International, Inc. (Æ)(Ñ) | 37,391 | 152 | ||
| Aggressive Equity Fund | 25 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
B&G Foods, Inc. Class A (Ñ) | 23,700 | 242 | ||
Boston Beer Co., Inc. Class A (Æ)(Ñ) | 1,469 | 55 | ||
Chiquita Brands International, Inc. (Æ) | 3,094 | 57 | ||
Church & Dwight Co., Inc. | 3,842 | 208 | ||
Coca-Cola Bottling Co. Consolidated (Ñ) | 200 | 12 | ||
Del Monte Foods Co. | 15,500 | 147 | ||
Flowers Foods, Inc. (Ñ) | 2,400 | 56 | ||
Fresh Del Monte Produce, Inc. (Æ)(Ñ) | 24,900 | 836 | ||
Green Mountain Coffee Roasters, Inc. (Æ)(Ñ) | 7,800 | 317 | ||
Hormel Foods Corp. | 2,000 | 81 | ||
JM Smucker Co. (The) | 9,142 | 470 | ||
Loews Corp. - Carolina Group | 7,400 | 631 | ||
Molson Coors Brewing Co. Class B (Ñ) | 8,700 | 449 | ||
Nash Finch Co. | 7,237 | 255 | ||
NBTY, Inc. (Æ) | 7,338 | 201 | ||
PepsiAmericas, Inc. (Ñ) | 8,900 | 297 | ||
Ralcorp Holdings, Inc. (Æ) | 14 | 1 | ||
Ruddick Corp. | 1,600 | 56 | ||
Sanderson Farms, Inc. (Ñ) | 5,852 | 198 | ||
Schweitzer-Mauduit International, Inc. | 4,469 | 116 | ||
Spartan Stores, Inc. (Ñ) | 3,200 | 73 | ||
Tootsie Roll Industries, Inc. (Ñ) | 8,459 | 232 | ||
TreeHouse Foods, Inc. (Æ)(Ñ) | 6,000 | 138 | ||
Universal Corp. | 4,127 | 211 | ||
| 5,491 | ||||
Financial Services - 14.4% | ||||
Advance America Cash Advance Centers, Inc. | 7,697 | 78 | ||
Affiliated Managers Group, Inc. (Æ)(Ñ) | 7,755 | 911 | ||
Allied World Assurance Co. Holdings, Ltd. | 3,200 | 161 | ||
American Financial Group, Inc. | 16,641 | 481 | ||
Amerisafe, Inc. (Æ) | 10,294 | 160 | ||
AmTrust Financial Services, Inc. | 3,486 | 48 | ||
Annaly Capital Management, Inc. (ö)(Ñ) | 56,844 | 1,033 | ||
Anthracite Capital, Inc. (ö) | 3,898 | 28 | ||
Anworth Mortgage Asset Corp. (ö)(Ñ) | 32,200 | 266 | ||
Apollo Investment Corp. (Ñ) | 11,000 | 188 | ||
Arch Capital Group, Ltd. (Æ)(Ñ) | 9,200 | 647 | ||
Ashford Hospitality Trust, Inc. (ö)(Ñ) | 23,700 | 170 | ||
Aspen Insurance Holdings, Ltd. (Ñ) | 12,700 | 366 | ||
Assurant, Inc. (Ñ) | 9,404 | 629 | ||
Astoria Financial Corp. (Ñ) | 9,600 | 223 | ||
Axis Capital Holdings, Ltd. | 11,600 | 452 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Bancfirst Corp. (Ñ) | 1,000 | 43 | ||
Banco Latinoamericano de Exportaciones SA Class E | 3,300 | 54 | ||
Bancorpsouth, Inc. (Ñ) | 4,200 | 99 | ||
Bank of Hawaii Corp. (Ñ) | 6,000 | 307 | ||
BankUnited Financial Corp. Class A | 15,336 | 106 | ||
BioMed Realty Trust, Inc. (ö) | 7,000 | 162 | ||
BOK Financial Corp. (Ñ) | 930 | 48 | ||
Broadridge Financial Solutions, Inc. (Ñ) | 30,200 | 677 | ||
Calamos Asset Management, Inc. Class A | 2,886 | 86 | ||
Capitol Bancorp, Ltd. | 2,600 | 52 | ||
Capstead Mortgage Corp. (ö)(Ñ) | 23,200 | 306 | ||
Cash America International, Inc. | 7,797 | 252 | ||
CIT Group, Inc. (Ñ) | 4,800 | 115 | ||
City Bank (Ñ) | 1,200 | 27 | ||
City National Corp. (Ñ) | 3,800 | 226 | ||
CNA Surety Corp. (Æ)(Ñ) | 2,800 | 55 | ||
Colonial BancGroup, Inc. (The) | 203 | 3 | ||
Commerce Bancshares, Inc. (Ñ) | 4,826 | 216 | ||
Corus Bankshares, Inc. | 17,894 | 191 | ||
CyberSource Corp. (Æ) | 17,600 | 313 | ||
Darwin Professional Underwriters, Inc. (Æ) | 900 | 22 | ||
Deerfield Capital Corp. (ö)(Ñ) | 14,400 | 115 | ||
Deluxe Corp. (Ñ) | 35,813 | 1,178 | ||
Digital Realty Trust, Inc. (ö) | 3,493 | 134 | ||
Dime Community Bancshares (Ñ) | 14,100 | 180 | ||
DST Systems, Inc. (Æ) | 1,986 | 164 | ||
East West Bancorp, Inc. (Ñ) | 12,533 | 304 | ||
EastGroup Properties, Inc. (ö)(Ñ) | 700 | 29 | ||
Eaton Vance Corp. | 6,213 | 282 | ||
EMC Insurance Group, Inc. (Ñ) | 900 | 21 | ||
Equity Lifestyle Properties, Inc. (ö) | 1,731 | 79 | ||
Euronet Worldwide, Inc. (Æ)(Ñ) | 26,107 | 783 | ||
Evercore Partners, Inc. Class A (Ñ) | 1,000 | 22 | ||
Factset Research Systems, Inc. (Ñ) | 5,000 | 279 | ||
Fair Isaac Corp. | 115 | 4 | ||
FBL Financial Group, Inc. Class A | 1,800 | 62 | ||
FCStone Group, Inc. (Æ)(Ñ) | 7,900 | 364 | ||
Federated Investors, Inc. Class B | 6,861 | 282 | ||
Fidelity National Financial, Inc. Class A (Ñ) | 17,200 | 251 | ||
First American Corp. (Ñ) | 9,600 | 328 | ||
First Marblehead Corp. (The) | 1,626 | 25 | ||
FirstFed Financial Corp. (Æ) | 4,882 | 175 | ||
Flushing Financial Corp. (Ñ) | 10,800 | 173 | ||
Frontier Financial Corp. | 1,344 | 25 |
| 26 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
GAMCO Investors, Inc. Class A (Ñ) | 1,500 | 104 | ||
Global Payments, Inc. | 15,139 | 704 | ||
Gramercy Capital Corp. (ö)(Ñ) | 1,000 | 24 | ||
Great Southern Bancorp, Inc. (Ñ) | 700 | 15 | ||
Green Bankshares, Inc. (Ñ) | 1,200 | 23 | ||
Greenhill & Co., Inc. | 1,738 | 116 | ||
Hallmark Financial Services, Inc. (Æ) | 1,300 | 21 | ||
Hanover Insurance Group, Inc. (The) | 6,000 | 275 | ||
Harleysville Group, Inc. (Ñ) | 2,000 | 71 | ||
HCC Insurance Holdings, Inc. | 9,750 | 280 | ||
Heartland Payment Systems, Inc. | 1,791 | 48 | ||
Hercules Technology Growth Capital, Inc. (Ñ) | 26,300 | 327 | ||
Hersha Hospitality Trust (ö)(Ñ) | 3,400 | 32 | ||
Hospitality Properties Trust (ö)(Ñ) | 10,100 | 325 | ||
HRPT Properties Trust (ö)(Ñ) | 27,400 | 212 | ||
Huron Consulting Group, Inc. (Æ)(Ñ) | 6,300 | 508 | ||
Hypercom Corp. (Æ)(Ñ) | 3,400 | 17 | ||
IBERIABANK Corp. (Ñ) | 1,100 | 51 | ||
Imperial Capital Bancorp, Inc. | 987 | 18 | ||
Intervest Bancshares Corp. Class A (Ñ) | 2,300 | 40 | ||
Invesco, Ltd. (Ñ) | 22,629 | 710 | ||
Investors Bancorp, Inc. (Æ) | 17,700 | 250 | ||
Investors Real Estate Trust (ö) | 2,600 | 23 | ||
IPC Holdings, Ltd. (Ñ) | 13,300 | 384 | ||
Jack Henry & Associates, Inc. | 4,445 | 108 | ||
Janus Capital Group, Inc. (Ñ) | 4,700 | 154 | ||
Jefferies Group, Inc. (Ñ) | 14,828 | 342 | ||
JER Investment Trust, Inc. (Æ)(Þ) | 9,200 | 99 | ||
Jones Lang LaSalle, Inc. | 1,498 | 107 | ||
Kearny Financial Corp. (Ñ) | 5,800 | 69 | ||
Liberty Property Trust (ö)(Ñ) | 7,700 | 222 | ||
MCG Capital Corp. (Ñ) | 9,400 | 109 | ||
Meadowbrook Insurance Group, Inc. (Æ)(Ñ) | 20,200 | 190 | ||
MFA Mortgage Investments, Inc. (ö) | 89,500 | 828 | ||
Midwest Banc Holdings, Inc. | 15,400 | 191 | ||
MVC Capital, Inc. | 2,400 | 39 | ||
Nasdaq Stock Market, Inc. (The) (Æ)(Ñ) | 21,759 | 1,077 | ||
National Retail Properties, Inc. (ö) | 10,722 | 251 | ||
Nationwide Financial Services, Inc. | 5,900 | 266 | ||
Nationwide Health Properties, Inc. (ö) | 418 | 13 | ||
NewStar Financial, Inc. (Æ)(Ñ) | 2,200 | 18 | ||
NorthStar Realty Finance Corp. (ö)(Ñ) | 4,600 | 41 | ||
Ocwen Financial Corp. (Æ) | 8,817 | 49 | ||
Odyssey Re Holdings Corp. (Ñ) | 5,800 | 213 | ||
Old National Bancorp (Ñ) | 15,200 | 227 |
| Principal Amount ($) or Shares | Market Value $ | |||
OMEGA Healthcare Investors, Inc. (ö) | 1,182 | 19 | ||
OneBeacon Insurance Group, Ltd. Class A | 3,500 | 75 | ||
optionsXpress Holdings, Inc. (Ñ) | 13,757 | 465 | ||
Pacific Capital Bancorp NA | 1,323 | 27 | ||
Pennsylvania Real Estate Investment Trust (ö)(Ñ) | 5,100 | 151 | ||
People’s United Financial, Inc. (Ñ) | 27,207 | 484 | ||
Philadelphia Consolidated Holding Co. (Æ) | 5,247 | 206 | ||
Phoenix Cos., Inc. (The) (Ñ) | 13,100 | 156 | ||
Platinum Underwriters Holdings, Ltd. | 9,900 | 352 | ||
Potlatch Corp. (ö)(Ñ) | 9,788 | 435 | ||
Preferred Bank (Ñ) | 1,050 | 27 | ||
Protective Life Corp. | 7,600 | 312 | ||
Provident New York Bancorp (Ñ) | 3,500 | 45 | ||
Raymond James Financial, Inc. (Ñ) | 24,300 | 794 | ||
Realty Income Corp. (ö) | 4,040 | 109 | ||
Reinsurance Group of America, Inc. (Ñ) | 5,700 | 299 | ||
RenaissanceRe Holdings, Ltd. | 2,400 | 145 | ||
Ryder System, Inc. (Ñ) | 3,800 | 179 | ||
S1 Corp. (Æ)(Ñ) | 35,540 | 259 | ||
Safety Insurance Group, Inc. | 3,611 | 132 | ||
SEI Investments Co. (Ñ) | 29,000 | 933 | ||
StanCorp Financial Group, Inc. | 6,800 | 343 | ||
Sterling Bancorp (Ñ) | 9,100 | 124 | ||
Sterling Bancshares, Inc. (Ñ) | 11,200 | 125 | ||
Strategic Hotels & Resorts, Inc. (ö) | 5,582 | 93 | ||
Sun Bancorp, Inc. (Æ)(Ñ) | 1,500 | 24 | ||
Superior Bancorp (Æ)(Ñ) | 3,700 | 20 | ||
SWS Group, Inc. (Ñ) | 10,327 | 131 | ||
Taylor Capital Group, Inc. (Ñ) | 1,834 | 37 | ||
Total System Services, Inc. (Ñ) | 10,037 | 281 | ||
Transatlantic Holdings, Inc. (Ñ) | 1,600 | 116 | ||
United America Indemnity, Ltd. Class A (Æ) | 3,500 | 70 | ||
United Fire & Casualty Co. (Ñ) | 1,600 | 47 | ||
Universal American Financial Corp. (Æ)(Ñ) | 7,672 | 196 | ||
Universal Health Realty Income Trust (ö) | 1,204 | 43 | ||
Unum Group (Ñ) | 13,600 | 324 | ||
Ventas, Inc. (ö) | 3,424 | 155 | ||
ViewPoint Financial Group | 8,800 | 145 | ||
Waddell & Reed Financial, Inc. Class A | 4,840 | 175 | ||
Webster Financial Corp. (Ñ) | 7,894 | 252 | ||
West Coast Bancorp (Ñ) | 900 | 17 |
| Aggressive Equity Fund | 27 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Whitney Holding Corp. (Ñ) | 6,900 | 180 | ||
Wilmington Trust Corp. (Ñ) | 3,500 | 123 | ||
Winthrop Realty Trust (ö) | 6,900 | 37 | ||
WP Stewart & Co., Ltd. (Æ) | 2,300 | 12 | ||
Wright Express Corp. (Æ) | 3,585 | 127 | ||
Zenith National Insurance Corp. (Ñ) | 13,874 | 621 | ||
| 33,073 | ||||
Health Care - 11.2% | ||||
Abaxis, Inc. (Æ) | 8,700 | 312 | ||
Accelrys, Inc. (Æ)(Ñ) | 24,600 | 185 | ||
Advanced Medical Optics, Inc. (Æ)(Ñ) | 14,200 | 348 | ||
Air Methods Corp. (Æ) | 1,067 | 53 | ||
Albany Molecular Research, Inc. (Æ) | 2,654 | 38 | ||
Allscripts Healthcare Solutions, Inc. (Æ)(Ñ) | 18,848 | 366 | ||
Alnylam Pharmaceuticals, Inc. (Æ) | 12 | — | ||
Amedisys, Inc. (Æ)(Ñ) | 6,700 | 325 | ||
American Medical Systems Holdings, Inc. (Æ)(Ñ) | 15,140 | 219 | ||
AMERIGROUP Corp. Class A (Æ)(Ñ) | 19,900 | 725 | ||
Amsurg Corp. Class A (Æ) | 555 | 15 | ||
Applera Corp. - Celera Group (Æ) | 13,500 | 214 | ||
Apria Healthcare Group, Inc. (Æ) | 1,425 | 31 | ||
Arthrocare Corp. (Æ)(Ñ) | 5,156 | 248 | ||
Beckman Coulter, Inc. (Ñ) | 3,100 | 226 | ||
Bio-Rad Laboratories, Inc. Class A (Æ) | 3,700 | 383 | ||
Bradley Pharmaceuticals, Inc. (Æ) | 3,108 | 61 | ||
Centene Corp. (Æ)(Ñ) | 9,900 | 272 | ||
Cephalon, Inc. (Æ) | 2,158 | 155 | ||
Cepheid, Inc. (Æ)(Ñ) | 6,800 | 179 | ||
Charles River Laboratories International, Inc. (Æ)(Ñ) | 2,500 | 164 | ||
Community Health Systems, Inc. (Æ)(Ñ) | 10,800 | 398 | ||
Conmed Corp. (Æ)(Ñ) | 7,831 | 181 | ||
Cooper Cos., Inc. (The) (Ñ) | 11,600 | 441 | ||
Cubist Pharmaceuticals, Inc. (Æ) | 5,598 | 115 | ||
Cypress Bioscience, Inc. (Æ) | 8,100 | 89 | ||
Datascope Corp. (Ñ) | 8,500 | 309 | ||
DENTSPLY International, Inc. | 4,969 | 224 | ||
Discovery Laboratories, Inc. (Æ)(Ñ) | 14,200 | 31 | ||
Eclipsys Corp. (Æ) | 6,231 | 158 | ||
Emergency Medical Services Corp. Class A (Æ)(Ñ) | 4,082 | 120 | ||
Endo Pharmaceuticals Holdings, Inc. (Æ) | 5,692 | 152 | ||
eResearchTechnology, Inc. (Æ)(Ñ) | 22,400 | 265 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Gen-Probe, Inc. (Æ)(Ñ) | 6,100 | 384 | ||
Greatbatch, Inc. (Æ) | 4,590 | 92 | ||
Haemonetics Corp. (Æ)(Ñ) | 9,511 | 599 | ||
Hanger Orthopedic Group, Inc. (Æ)(Ñ) | 1,400 | 15 | ||
Health Net, Inc. (Æ) | 5,114 | 247 | ||
Healthspring, Inc. (Æ) | 25,106 | 478 | ||
Healthways, Inc. (Æ)(Ñ) | 4,426 | 259 | ||
Henry Schein, Inc. (Æ) | 606 | 37 | ||
HMS Holdings Corp. (Æ)(Ñ) | 30,088 | 999 | ||
Hologic, Inc. (Æ)(Ñ) | 12,412 | 852 | ||
I-Flow Corp. (Æ) | 3,615 | 57 | ||
Icon PLC - ADR (Æ) | 8,290 | 513 | ||
Illumina, Inc. (Æ)(Ñ) | 19,472 | 1,154 | ||
Immucor, Inc. (Æ)(Ñ) | 32,424 | 1,102 | ||
IMS Health, Inc. | 5,900 | 136 | ||
Intuitive Surgical, Inc. (Æ)(Ñ) | 2,598 | 843 | ||
Invacare Corp. (Ñ) | 22,068 | 556 | ||
Invitrogen Corp. (Æ)(Ñ) | 8,100 | 757 | ||
Isis Pharmaceuticals, Inc. (Æ)(Ñ) | 6,100 | 96 | ||
Kendle International, Inc. (Æ) | 2,989 | 146 | ||
Kindred Healthcare, Inc. (Æ)(Ñ) | 3,000 | 75 | ||
King Pharmaceuticals, Inc. (Æ)(Ñ) | 34,534 | 354 | ||
KV Pharmaceutical Co. Class A (Æ)(Ñ) | 12,800 | 365 | ||
Lincare Holdings, Inc. (Æ) | 4,049 | 142 | ||
Martek Biosciences Corp. (Æ) | 2,859 | 85 | ||
Masimo Corp. (Æ)(Ñ) | 6,133 | 242 | ||
Matria Healthcare, Inc. (Æ) | 3,593 | 85 | ||
Medcath Corp. (Æ) | 3,698 | 91 | ||
Medicis Pharmaceutical Corp. Class A (Ñ) | 8,664 | 225 | ||
Medtox Scientific, Inc. (Æ) | 1,275 | 23 | ||
Meridian Bioscience, Inc. (Ñ) | 12,000 | 361 | ||
Millipore Corp. (Æ)(Ñ) | 4,100 | 300 | ||
Molina Healthcare, Inc. (Æ)(Ñ) | 5,200 | 201 | ||
Myriad Genetics, Inc. (Æ)(Ñ) | 7,400 | 344 | ||
Neurocrine Biosciences, Inc. (Æ)(Ñ) | 13,100 | 59 | ||
NuVasive, Inc. (Æ) | 3,800 | 150 | ||
Omrix Biopharmaceuticals, Inc. (Æ)(Ñ) | 7,000 | 243 | ||
OSI Pharmaceuticals, Inc. (Æ) | 2,519 | 122 | ||
Par Pharmaceutical Cos., Inc. (Æ) | 3,000 | 72 | ||
Patterson Cos., Inc. (Æ) | 3,740 | 127 | ||
Pediatrix Medical Group, Inc. (Æ)(Ñ) | 12,145 | 828 | ||
Perrigo Co. (Ñ) | 12,053 | 422 | ||
Pharmacopeia, Inc. (Æ)(Ñ) | 16,050 | 77 | ||
PharmaNet Development Group, Inc. (Æ) | 654 | 26 | ||
PharMerica Corp. (Æ)(Ñ) | 9,400 | 130 | ||
Phase Forward, Inc. (Æ)(Ñ) | 2,700 | 59 | ||
Psychiatric Solutions, Inc. (Æ)(Ñ) | 33,199 | 1,079 |
| 28 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Quality Systems, Inc. (Ñ) | 10,474 | 319 | ||
Resmed, Inc. (Æ)(Ñ) | 8,335 | 438 | ||
Sciele Pharma, Inc. (Æ) | 5,609 | 115 | ||
Sirona Dental Systems, Inc. (Æ)(Ñ) | 15,510 | 519 | ||
SurModics, Inc. (Æ) | 167 | 9 | ||
Symmetry Medical, Inc. (Æ) | 2,116 | 37 | ||
Techne Corp. (Æ) | 9,496 | 627 | ||
VCA Antech, Inc. (Æ) | 15,600 | 690 | ||
Watson Pharmaceuticals, Inc. Class B (Æ) | 9,726 | 264 | ||
WellCare Health Plans, Inc. (Æ) | 579 | 25 | ||
West Pharmaceutical Services, Inc. | 1,300 | 53 | ||
| 25,707 | ||||
Materials and Processing - 11.5% | ||||
Airgas, Inc. | 12,845 | 669 | ||
AK Steel Holding Corp. (Æ) | 3,544 | 164 | ||
Albemarle Corp. (Ñ) | 16,288 | 672 | ||
Ashland, Inc. (Ñ) | 6,300 | 299 | ||
Ball Corp. | 8,784 | 395 | ||
Barnes Group, Inc. (Ñ) | 9,936 | 332 | ||
Bluegreen Corp. (Æ)(Ñ) | 3,000 | 22 | ||
Buckeye Technologies, Inc. (Æ)(Ñ) | 41,375 | 517 | ||
Cambrex Corp. (Ñ) | 23,500 | 197 | ||
Carpenter Technology Corp. (Ñ) | 6,926 | 521 | ||
Celanese Corp. Class A | 23,389 | 990 | ||
CF Industries Holdings, Inc. | 4,144 | 456 | ||
Chemtura Corp. | 52,600 | 410 | ||
Chicago Bridge & Iron Co. NV | 12,423 | 751 | ||
Cie Generale de Geophysique-Veritas - ADR (Æ) | 5,109 | 286 | ||
Comfort Systems USA, Inc. (Ñ) | 9,800 | 125 | ||
Commercial Metals Co. | 4,637 | 137 | ||
Constar International, Inc. (Æ)(Ñ) | 10,500 | 43 | ||
Corn Products International, Inc. (Ñ) | 8,502 | 312 | ||
Crown Holdings, Inc. (Æ) | 17,600 | 451 | ||
Cytec Industries, Inc. (Ñ) | 12,100 | 745 | ||
DuPont Fabros Technology, Inc. (ö)(Ñ) | 11,200 | 220 | ||
Dycom Industries, Inc. (Æ) | 2,800 | 75 | ||
Dynamic Materials Corp. (Ñ) | 5,900 | 348 | ||
Eastman Chemical Co. (Ñ) | 9,289 | 567 | ||
EMCOR Group, Inc. (Æ) | 28,912 | 683 | ||
EnerSys (Æ)(Ñ) | 2,400 | 60 | ||
Ennis, Inc. (Ñ) | 5,900 | 106 | ||
Ferro Corp. | 1,911 | 40 | ||
Glatfelter | 18,900 | 289 | ||
GrafTech International, Ltd. (Æ) | 12,251 | 217 | ||
Granite Construction, Inc. | 5,500 | 199 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Haynes International, Inc. (Æ)(Ñ) | 6,100 | 424 | ||
HB Fuller Co. | 7,300 | 164 | ||
Hecla Mining Co. (Æ) | 6,937 | 65 | ||
Hercules, Inc. (Ñ) | 19,344 | 374 | ||
Hilltop Holdings, Inc. (Æ)(Ñ) | 3,800 | 41 | ||
Innospec, Inc. | 5,538 | 95 | ||
Interface, Inc. Class A | 792 | 13 | ||
Jacobs Engineering Group, Inc. (Æ)(Ñ) | 12,570 | 1,202 | ||
KBR, Inc. (Æ)(Ñ) | 17,850 | 693 | ||
Koppers Holdings, Inc. (Ñ) | 4,400 | 190 | ||
Layne Christensen Co. (Æ)(Ñ) | 2,600 | 128 | ||
LB Foster Co. Class A (Æ)(Ñ) | 7,961 | 412 | ||
Lennox International, Inc. (Ñ) | 14,293 | 592 | ||
LSI Industries, Inc. | 4,300 | 78 | ||
Lubrizol Corp. | 3,600 | 195 | ||
Lydall, Inc. (Æ) | 1,200 | 13 | ||
McDermott International, Inc. (Æ) | 23,409 | 1,382 | ||
Meruelo Maddux Properties, Inc. (Æ)(Ñ) | 1,800 | 7 | ||
Michael Baker Corp. (Æ) | 767 | 32 | ||
Myers Industries, Inc. (Ñ) | 12,900 | 187 | ||
NewMarket Corp. (Ñ) | 500 | 28 | ||
Olin Corp. (Ñ) | 25,200 | 487 | ||
OM Group, Inc. (Æ) | 12,993 | 748 | ||
Owens-Illinois, Inc. (Æ) | 6,558 | 325 | ||
Perini Corp. (Æ)(Ñ) | 5,159 | 214 | ||
PolyOne Corp. (Æ)(Ñ) | 11,600 | 76 | ||
Quanta Services, Inc. (Æ)(Ñ) | 22,800 | 598 | ||
Reliance Steel & Aluminum Co. | 236 | 13 | ||
Rock-Tenn Co. Class A (Ñ) | 22,197 | 564 | ||
Rockwood Holdings, Inc. (Æ) | 3,647 | 121 | ||
RTI International Metals, Inc. (Æ)(Ñ) | 5,150 | 355 | ||
Schnitzer Steel Industries, Inc. Class A (Ñ) | 5,343 | 369 | ||
Shaw Group, Inc. (The) (Æ) | 3,178 | 192 | ||
Sigma-Aldrich Corp. | 10,100 | 551 | ||
Simpson Manufacturing Co., Inc. | 3,315 | 88 | ||
Sonoco Products Co. | 19,029 | 622 | ||
Spartech Corp. | 18,762 | 265 | ||
Standard Register Co. (The) (Ñ) | 2,100 | 24 | ||
Superior Essex, Inc. (Æ)(Ñ) | 5,451 | 131 | ||
Terra Nitrogen Co., LP (Ñ) | 2,000 | 299 | ||
Timken Co. | 10,700 | 351 | ||
Tredegar Corp. | 4,868 | 78 | ||
Tronox, Inc. Class B (Ñ) | 4,800 | 42 | ||
URS Corp. (Æ)(Ñ) | 30,586 | 1,662 | ||
USEC, Inc. (Æ)(Ñ) | 27,010 | 243 | ||
Valspar Corp. (Ñ) | 5,600 | 126 |
| Aggressive Equity Fund | 29 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Wausau Paper Corp. (Ñ) | 4,700 | 42 | ||
Xerium Technologies, Inc. | 3,100 | 16 | ||
Zep, Inc. (Æ) | 212 | 3 | ||
| 26,218 | ||||
Miscellaneous - 0.6% | ||||
Brunswick Corp. (Ñ) | 18,575 | 317 | ||
Castlepoint Holdings, Ltd. (Æ)(Þ) | 30,900 | 371 | ||
iPCS, Inc. | 177 | 6 | ||
Lancaster Colony Corp. (Ñ) | 4,400 | 175 | ||
Teleflex, Inc. | 7,771 | 489 | ||
| 1,358 | ||||
Other Energy - 6.3% | ||||
Atlas America, Inc. (Ñ) | 6,500 | 385 | ||
ATP Oil & Gas Corp. (Æ) | 5,400 | 273 | ||
Atwood Oceanics, Inc. (Æ)(Ñ) | 7,740 | 776 | ||
Berry Petroleum Co. Class A (Ñ) | 7,600 | 338 | ||
Bois d’Arc Energy, Inc. (Æ)(Ñ) | 16,200 | 321 | ||
Brigham Exploration Co. (Æ)(Ñ) | 40,790 | 307 | ||
Bronco Drilling Co., Inc. (Æ) | 2,499 | 37 | ||
Cameron International Corp. (Æ)(Ñ) | 6,600 | 318 | ||
CARBO Ceramics, Inc. (Ñ) | 6,000 | 223 | ||
Carrizo Oil & Gas, Inc. (Æ)(Ñ) | 7,900 | 432 | ||
Comstock Resources, Inc. (Æ) | 524 | 18 | ||
Continental Resources, Inc. (Æ)(Ñ) | 2,100 | 55 | ||
Core Laboratories NV (Æ)(Ñ) | 7,015 | 875 | ||
Dawson Geophysical Co. (Æ)(Ñ) | 1,100 | 79 | ||
Delek US Holdings, Inc. (Ñ) | 9,800 | 198 | ||
Dresser-Rand Group, Inc. (Æ) | 8,374 | 327 | ||
Dril-Quip, Inc. (Æ)(Ñ) | 11,400 | 634 | ||
EnerNOC, Inc. - ADR (Æ)(Ñ) | 5,600 | 275 | ||
FMC Technologies, Inc. (Æ)(Ñ) | 8,494 | 482 | ||
Frontier Oil Corp. (Ñ) | 2,400 | 97 | ||
Global Industries, Ltd. (Æ) | 15,056 | 322 | ||
Goodrich Petroleum Corp. (Æ)(Ñ) | 8,124 | 184 | ||
Grey Wolf, Inc. (Æ)(Ñ) | 41,900 | 223 | ||
Helmerich & Payne, Inc. (Ñ) | 9,900 | 397 | ||
Hornbeck Offshore Services, Inc. (Æ)(Ñ) | 9,700 | 436 | ||
JA Solar Holdings Co., Ltd. - ADR (Æ)(Ñ) | 5,000 | 349 | ||
Mariner Energy, Inc. (Æ) | 5,658 | 129 | ||
Meridian Resource Corp. (Æ) | 8,689 | 16 | ||
NATCO Group, Inc. Class A (Æ)(Ñ) | 6,815 | 369 | ||
Newfield Exploration Co. (Æ) | 5,050 | 266 | ||
Oceaneering International, Inc. (Æ) | 12,392 | 835 | ||
Ormat Technologies, Inc. (Ñ) | 4,900 | 269 | ||
Patterson-UTI Energy, Inc. | 5,000 | 98 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Petrohawk Energy Corp. (Æ) | 9,346 | 162 | ||
Petroquest Energy, Inc. (Æ)(Ñ) | 42,900 | 613 | ||
Quicksilver Resources, Inc. (Æ) | 3,000 | 179 | ||
Range Resources Corp. | 5,000 | 257 | ||
Rosetta Resources, Inc. (Æ) | 2,648 | 52 | ||
SEACOR Holdings, Inc. (Æ)(Ñ) | 3,600 | 334 | ||
Southwestern Energy Co. (Æ)(Ñ) | 9,200 | 513 | ||
Stone Energy Corp. (Æ) | 14,000 | 657 | ||
T-3 Energy Services, Inc. (Æ) | 400 | 19 | ||
Targa Resources Partners, LP (Ñ) | 5,700 | 169 | ||
Tesoro Corp. (Ñ) | 14,435 | 688 | ||
TETRA Technologies, Inc. (Æ)(Ñ) | 11,100 | 173 | ||
Union Drilling, Inc. (Æ)(Ñ) | 2,900 | 46 | ||
W&T Offshore, Inc. | 4,390 | 131 | ||
Western Refining, Inc. (Ñ) | 6,400 | 155 | ||
| 14,491 | ||||
Producer Durables - 9.1% | ||||
Actuant Corp. Class A | 290 | 10 | ||
AGCO Corp. (Æ)(Ñ) | 10,227 | 695 | ||
Arris Group, Inc. (Æ)(Ñ) | 36,090 | 360 | ||
BE Aerospace, Inc. (Æ) | 26,600 | 1,407 | ||
Belden, Inc. (Ñ) | 14,611 | 650 | ||
Chart Industries, Inc. (Æ) | 12,971 | 401 | ||
Cognex Corp. (Ñ) | 22,400 | 451 | ||
Cohu, Inc. (Ñ) | 14,700 | 225 | ||
Crane Co. (Ñ) | 8,200 | 352 | ||
Credence Systems Corp. (Æ)(Ñ) | 51,799 | 125 | ||
CTS Corp. (Ñ) | 12,913 | 128 | ||
Darling International, Inc. (Æ) | 14,357 | 166 | ||
Dionex Corp. (Æ)(Ñ) | 3,200 | 265 | ||
EnPro Industries, Inc. (Æ) | 528 | 16 | ||
ESCO Technologies, Inc. (Æ)(Ñ) | 5,400 | 216 | ||
Esterline Technologies Corp. (Æ) | 2,509 | 130 | ||
Flowserve Corp. | 7,900 | 760 | ||
Gardner Denver, Inc. (Æ) | 15,700 | 518 | ||
General Cable Corp. (Æ)(Ñ) | 6,637 | 486 | ||
Goodrich Corp. (Ñ) | 18,571 | 1,311 | ||
HNI Corp. (Ñ) | 6,100 | 214 | ||
Hubbell, Inc. Class B (Ñ) | 14,554 | 751 | ||
Joy Global, Inc. (Ñ) | 5,255 | 346 | ||
Kennametal, Inc. | 11,300 | 428 | ||
Kimball International, Inc. Class B (Ñ) | 3,800 | 52 | ||
Knoll, Inc. | 4,382 | 72 | ||
Lexmark International, Inc. Class A (Æ) | 5,049 | 176 | ||
LTX Corp. (Æ) | 10,396 | 33 | ||
Manitowoc Co., Inc. (The) (Ñ) | 2,000 | 98 | ||
MasTec, Inc. (Æ)(Ñ) | 4,200 | 43 | ||
| 30 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Mercadolibre, Inc. (Æ) | 6,400 | 473 | ||
Milacron, Inc. (Æ)(Ñ) | 3,124 | 10 | ||
Molex, Inc. (Ñ) | 7,700 | 210 | ||
Moog, Inc. Class A (Æ)(Ñ) | 4,515 | 207 | ||
Pall Corp. | 20,800 | 839 | ||
Park-Ohio Holdings Corp. (Æ)(Ñ) | 700 | 18 | ||
Plantronics, Inc. | 338 | 9 | ||
Polycom, Inc. (Æ)(Ñ) | 19,945 | 554 | ||
Ritchie Bros Auctioneers, Inc. | 12,387 | 1,024 | ||
Robbins & Myers, Inc. (Ñ) | 13,200 | 998 | ||
Steelcase, Inc. Class A (Ñ) | 26,227 | 416 | ||
Sun Hydraulics Corp. (Ñ) | 3,000 | 76 | ||
Suntech Power Holdings Co., Ltd. - ADR (Æ)(Ñ) | 7,000 | 576 | ||
Tecumseh Products Co. Class A (Æ)(Ñ) | 19,318 | 452 | ||
Teledyne Technologies, Inc. (Æ)(Ñ) | 6,600 | 352 | ||
Tennant Co. (Ñ) | 3,200 | 142 | ||
Teradyne, Inc. (Æ) | 41,792 | 432 | ||
Terex Corp. (Æ) | 2,924 | 192 | ||
TransDigm Group, Inc. (Æ) | 9,200 | 416 | ||
Triumph Group, Inc. (Ñ) | 8,300 | 683 | ||
Ultra Clean Holdings, Inc. (Æ) | 3,486 | 42 | ||
Ultratech, Inc. (Æ)(Ñ) | 19,200 | 218 | ||
Waters Corp. (Æ) | 8,200 | 648 | ||
Woodward Governor Co. (Ñ) | 6,642 | 451 | ||
WW Grainger, Inc. | 4,600 | 403 | ||
| 20,726 | ||||
Technology - 17.6% | ||||
ActivIdentity Corp. (Æ)(Ñ) | 500 | 2 | ||
Adaptec, Inc. (Æ) | 21,100 | 71 | ||
ADC Telecommunications, Inc. (Æ)(Ñ) | 17,400 | 271 | ||
Adtran, Inc. (Ñ) | 11,200 | 239 | ||
Alliance Semiconductor Corp. | 16,700 | 27 | ||
Amkor Technology, Inc. (Æ)(Ñ) | 10,800 | 92 | ||
Amphenol Corp. Class A (Ñ) | 26,871 | 1,246 | ||
Ansys, Inc. (Æ)(Ñ) | 34,801 | 1,443 | ||
Applied Micro Circuits Corp. (Æ)(Ñ) | 9,099 | 80 | ||
ARM Holdings PLC - ADR | 35,200 | 260 | ||
Arrow Electronics, Inc. (Æ) | 2,190 | 86 | ||
AsiaInfo Holdings, Inc. (Æ) | 1,862 | 20 | ||
Atheros Communications, Inc. (Æ)(Ñ) | 3,800 | 116 | ||
Atmel Corp. (Æ)(Ñ) | 6,500 | 28 | ||
Avanex Corp. (Æ)(Ñ) | 64,900 | 65 | ||
Avici Systems, Inc. | 2,200 | 17 | ||
Avnet, Inc. (Æ) | 18,634 | 652 | ||
Avocent Corp. (Æ) | 1,056 | 25 | ||
AVX Corp. | 11,950 | 160 | ||
BearingPoint, Inc. (Æ)(Ñ) | 36,500 | 103 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Blackboard, Inc. (Æ)(Ñ) | 14,000 | 564 | ||
BMC Software, Inc. (Æ) | 5,757 | 205 | ||
Bookham, Inc. (Æ)(Ñ) | 12,600 | 30 | ||
Brocade Communications Systems, Inc. (Æ)(Ñ) | 68,500 | 503 | ||
CACI International, Inc. Class A (Æ) | 3,277 | 147 | ||
Captaris, Inc. (Æ) | 2,903 | 13 | ||
Cavium Networks, Inc. (Æ)(Ñ) | 13,700 | 315 | ||
Cbeyond, Inc. (Æ)(Ñ) | 4,300 | 168 | ||
Checkpoint Systems, Inc. (Æ)(Ñ) | 9,000 | 234 | ||
Ciber, Inc. (Æ)(Ñ) | 2,500 | 15 | ||
Ciena Corp. (Æ)(Ñ) | 7,021 | 239 | ||
Cognizant Technology Solutions Corp. Class A (Æ) | 10,200 | 346 | ||
CommScope, Inc. (Æ)(Ñ) | 9,937 | 489 | ||
Compuware Corp. (Æ)(Ñ) | 6,600 | 59 | ||
Comtech Telecommunications Corp. (Æ)(Ñ) | 10,323 | 558 | ||
Comverse Technology, Inc. (Æ)(Ñ) | 20,700 | 357 | ||
Conexant Systems, Inc. (Æ)(Ñ) | 53,700 | 45 | ||
Cray, Inc. (Æ) | 3,300 | 20 | ||
CSG Systems International, Inc. (Æ)(Ñ) | 12,237 | 180 | ||
Cubic Corp. (Ñ) | 8,400 | 329 | ||
Data Domain, Inc. (Æ) | 11,900 | 313 | ||
Digital River, Inc. (Æ) | 3,096 | 102 | ||
Diodes, Inc. (Æ)(Ñ) | 20,451 | 615 | ||
DivX, Inc. (Æ)(Ñ) | 17,300 | 242 | ||
DRS Technologies, Inc. | 101 | 5 | ||
EPIQ Systems, Inc. (Æ)(Ñ) | 31,274 | 544 | ||
Equinix, Inc. (Æ)(Ñ) | 8,748 | 884 | ||
Extreme Networks, Inc. (Æ)(Ñ) | 16,200 | 57 | ||
F5 Networks, Inc. (Æ)(Ñ) | 10,655 | 304 | ||
First Solar, Inc. (Æ)(Ñ) | 1,800 | 481 | ||
Flir Systems, Inc. (Æ)(Ñ) | 27,140 | 849 | ||
Foundry Networks, Inc. (Æ)(Ñ) | 41,859 | 733 | ||
GeoEye, Inc. (Æ)(Ñ) | 17,295 | 582 | ||
Gerber Scientific, Inc. (Æ)(Ñ) | 3,300 | 36 | ||
Harris Corp. (Ñ) | 11,151 | 699 | ||
Hittite Microwave Corp. (Æ)(Ñ) | 14,296 | 683 | ||
Ikanos Communications, Inc. (Æ) | 16,600 | 89 | ||
Imation Corp. (Ñ) | 12,600 | 265 | ||
Informatica Corp. (Æ)(Ñ) | 42,067 | 758 | ||
Ingram Micro, Inc. Class A (Æ) | 18,100 | 327 | ||
Interactive Intelligence, Inc. (Æ) | 529 | 14 | ||
Intermec, Inc. (Æ)(Ñ) | 13,518 | 275 | ||
Interwoven, Inc. (Æ) | 26,000 | 370 | ||
Intuit, Inc. (Æ)(Ñ) | 14,426 | 456 | ||
ION Geophysical Corp. (Æ)(Ñ) | 19,900 | 314 | ||
Ixia (Æ) | 1,700 | 16 |
| Aggressive Equity Fund | 31 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
JDA Software Group, Inc. (Æ)(Ñ) | 4,500 | 92 | ||
JDS Uniphase Corp. (Æ)(Ñ) | 14,400 | 192 | ||
Keynote Systems, Inc. (Æ)(Ñ) | 14,700 | 207 | ||
Lawson Software, Inc. (Æ) | 12,751 | 131 | ||
Manhattan Associates, Inc. (Æ) | 9,838 | 259 | ||
Marvell Technology Group, Ltd. (Æ) | 18,750 | 262 | ||
MEMC Electronic Materials, Inc. (Æ) | 4,400 | 389 | ||
Mercury Computer Systems, Inc. (Æ)(Ñ) | 11,200 | 180 | ||
Merrimac Industries, Inc. (Æ)(Ñ) | 3,300 | 33 | ||
Methode Electronics, Inc. | 11,237 | 185 | ||
Micrel, Inc. (Ñ) | 56,890 | 481 | ||
Micros Systems, Inc. (Æ)(Ñ) | 17,634 | 1,237 | ||
Microsemi Corp. (Æ)(Ñ) | 19,424 | 430 | ||
Monolithic Power Systems, Inc. (Æ)(Ñ) | 12,470 | 268 | ||
NAM TAI Electronics, Inc. (Ñ) | 13,500 | 152 | ||
Netlogic Microsystems, Inc. (Æ)(Ñ) | 13,000 | 419 | ||
NetSuite, Inc. (Æ)(Ñ) | 2,446 | 96 | ||
Nice Systems, Ltd. - ADR (Æ)(Ñ) | 35,781 | 1,228 | ||
Nuance Communications, Inc. (Æ)(Ñ) | 9,600 | 179 | ||
Omniture, Inc. (Æ) | 10,500 | 350 | ||
ON Semiconductor Corp. (Æ) | 16,923 | 150 | ||
Openwave Systems, Inc. (Ñ) | 7,700 | 20 | ||
Orckit Communications, Ltd. (Æ)(Ñ) | 12,300 | 82 | ||
PerkinElmer, Inc. | 33,951 | 883 | ||
Power Integrations, Inc. (Æ) | 2,600 | 90 | ||
Rackable Systems, Inc. (Æ)(Ñ) | 8,300 | 83 | ||
RADWARE, Ltd. (Æ)(Ñ) | 7,600 | 117 | ||
RealNetworks, Inc. (Æ)(Ñ) | 45,300 | 276 | ||
RF Micro Devices, Inc. (Æ) | 21,206 | 121 | ||
SAIC, Inc. (Æ)(Ñ) | 6,700 | 135 | ||
SanDisk Corp. (Æ)(Ñ) | 9,809 | 325 | ||
Sanmina-SCI Corp. (Æ)(Ñ) | 90,700 | 165 | ||
Sapient Corp. (Æ)(Ñ) | 17,200 | 152 | ||
Satyam Computer Services, Ltd. - ADR (Ñ) | 21,030 | 562 | ||
Seachange International, Inc. (Æ)(Ñ) | 24,300 | 176 | ||
Seagate Technology | 3,397 | 87 | ||
Secure Computing Corp. (Æ) | 11,886 | 114 | ||
Sigma Designs, Inc. (Æ)(Ñ) | 3,900 | 215 | ||
Sigmatel, Inc. (Æ)(Ñ) | 6,200 | 13 | ||
Silicon Image, Inc. (Æ) | 8,800 | 40 | ||
SiRF Technology Holdings, Inc. (Æ)(Ñ) | 20,213 | 508 | ||
Skyworks Solutions, Inc. (Æ)(Ñ) | 77,000 | 654 | ||
SonicWALL, Inc. (Æ)(Ñ) | 16,300 | 175 | ||
SRA International, Inc. Class A (Æ) | 4,838 | 142 | ||
Sunpower Corp. Class A (Æ)(Ñ) | 1,900 | 248 | ||
Sybase, Inc. (Æ) | 12,441 | 325 |
| Principal Amount ($) or Shares | Market Value $ | |||
Sycamore Networks, Inc. (Æ)(Ñ) | 17,800 | 68 | ||
Synchronoss Technologies, Inc. (Æ) | 3,310 | 117 | ||
Syniverse Holdings, Inc. (Æ)(Ñ) | 33,783 | 526 | ||
SYNNEX Corp. (Æ)(Ñ) | 5,600 | 110 | ||
Syntel, Inc. (Ñ) | 2,100 | 81 | ||
Taleo Corp. Class A (Æ) | 3,584 | 107 | ||
Tekelec (Æ)(Ñ) | 39,100 | 489 | ||
Tessera Technologies, Inc. (Æ)(Ñ) | 20,317 | 845 | ||
TIBCO Software, Inc. (Æ)(Ñ) | 49,200 | 397 | ||
Trimble Navigation, Ltd. (Æ)(Ñ) | 16,527 | 500 | ||
TriQuint Semiconductor, Inc. (Æ)(Ñ) | 44,700 | 296 | ||
Unisys Corp. (Æ)(Ñ) | 49,900 | 236 | ||
Utstarcom, Inc. (Æ)(Ñ) | 31,000 | 85 | ||
VeriFone Holdings, Inc. (Æ)(Ñ) | 19,800 | 460 | ||
Verigy, Ltd. (Æ) | 37,346 | 1,015 | ||
Verint Systems, Inc. (Æ)(Ñ) | 23,712 | 464 | ||
Vignette Corp. (Æ) | 10,435 | 152 | ||
Vocus, Inc. (Æ)(Ñ) | 16,200 | 559 | ||
Wavecom SA - ADR (Æ) | 5,300 | 90 | ||
Western Digital Corp. (Æ)(Ñ) | 22,500 | 680 | ||
Zebra Technologies Corp. Class A (Æ) | 2,048 | 71 | ||
Zoran Corp. (Æ)(Ñ) | 17,700 | 398 | ||
| 40,206 | ||||
Utilities - 5.9% | ||||
AGL Resources, Inc. | 7,655 | 288 | ||
Alliant Energy Corp. (Ñ) | 18,400 | 749 | ||
Atmos Energy Corp. (Ñ) | 21,732 | 609 | ||
Black Hills Corp. | 6,366 | 281 | ||
Canadian Solar, Inc. (Æ)(Ñ) | 18,800 | 529 | ||
Centerpoint Energy, Inc. (Ñ) | 17,400 | 298 | ||
CenturyTel, Inc. (Ñ) | 21,536 | 893 | ||
Cincinnati Bell, Inc. (Æ) | 17,294 | 82 | ||
Citizens Communications Co. | 8,082 | 103 | ||
Cleco Corp. (Ñ) | 33,516 | 932 | ||
CMS Energy Corp. (Ñ) | 15,200 | 264 | ||
Energen Corp. | 12,361 | 794 | ||
FiberTower Corp. (Æ)(Ñ) | 12,800 | 29 | ||
IDT Corp. Class B (Æ)(Ñ) | 7,400 | 63 | ||
Laclede Group, Inc. (The) (Ñ) | 1,524 | 52 | ||
MDU Resources Group, Inc. (Ñ) | 5,400 | 149 | ||
MGE Energy, Inc. (Ñ) | 100 | 4 | ||
New Jersey Resources Corp. (Ñ) | 2,200 | 110 | ||
NII Holdings, Inc. (Æ) | 4,276 | 207 | ||
Northeast Utilities | 38,400 | 1,202 | ||
NTELOS Holdings Corp. (Ñ) | 11,556 | 343 | ||
OGE Energy Corp. | 6,717 | 244 | ||
Oneok, Inc. (Ñ) | 5,300 | 237 | ||
| 32 | Aggressive Equity Fund |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | ||||
Pepco Holdings, Inc. (Ñ) | 13,900 | 408 | |||
Piedmont Natural Gas Co. (Ñ) | 11,400 | 298 | |||
Portland General Electric Co. (Ñ) | 7,312 | 203 | |||
Premiere Global Services, Inc. (Æ) | 11,100 | 165 | |||
SCANA Corp. | 3,688 | 155 | |||
Sierra Pacific Resources | 26,300 | 447 | |||
Southern Union Co. (Ñ) | 15,193 | 446 | |||
Southwest Gas Corp. (Ñ) | 20,874 | 621 | |||
Suburban Propane Partners, LP | 3,100 | 126 | |||
Telephone & Data Systems, Inc. | 7,653 | 479 | |||
Time Warner Telecom, Inc. Class A (Æ)(Ñ) | 23,011 | 467 | |||
UGI Corp. (Ñ) | 30,900 | 842 | |||
UIL Holdings Corp. (Ñ) | 9,200 | 340 | |||
USA Mobility, Inc. (Æ) | 5,476 | 78 | |||
| 13,537 | |||||
Total Common Stocks | |||||
(cost $210,006) | 220,357 | ||||
Warrants & Rights - 0.0% | |||||
Financial Services - 0.0% | |||||
Washington Mutual, Inc. | 42,200 | 7 | |||
| Total Warrants & Rights | |||||
(cost $10) | 7 | ||||
| Short-Term Investments - 3.9% | |||||
Russell Investment Company Money Market Fund | 8,009,000 | 8,009 | |||
United States Treasury Bills (ž)(§) | |||||
2.962% due 03/20/08 | 1,000 | 993 | |||
| Total Short-Term Investments | |||||
(cost $9,003) | 9,002 | ||||
| Other Securities - 42.7% | |||||
State Street Securities Lending Quality Trust (×) | 97,816,591 | 97,817 | |||
| Total Other Securities | |||||
(cost $97,817) | 97,817 | ||||
| Total Investments - 142.9% | |||||
(identified cost $316,836) | 327,183 | ||||
| Other Assets and Liabilities, Net - (42.9%) | (98,256 | ) | |||
| Net Assets - 100.0% | 228,927 | ||||
See accompanying notes which are an integral part of the financial statements.
| Aggressive Equity Fund | 33 |
Table of Contents
Russell Investment Funds
Aggressive Equity Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands
| Futures Contracts (Number of Contracts) | Notional Amount | Unrealized Appreciation (Depreciation) $ | ||||
| Long Positions | ||||||
| Russell 2000 Mini Index (CME) expiration date 03/08 (114) | USD | 8,803 | (30 | ) | ||
| Total Unrealized Appreciation (Depreciation) on Open Futures Contracts | (30 | ) | ||||
Presentation of Portfolio Holdings — December 31, 2007
| Portfolio Summary | % of Net Assets | ||
Auto and Transportation | 2.7 | ||
Consumer Discretionary | 14.6 | ||
Consumer Staples | 2.4 | ||
Financial Services | 14.4 | ||
Health Care | 11.2 | ||
Materials and Processing | 11.5 | ||
Miscellaneous | 0.6 | ||
Other Energy | 6.3 | ||
Producer Durables | 9.1 | ||
Technology | 17.6 | ||
Utilities | 5.9 | ||
Warrants & Rights | — | * | |
Short-Term Investments | 3.9 | ||
Other Securities | 42.7 | ||
Total Investments | 142.9 | ||
Other Assets and Liabilities, Net | (42.9 | ) | |
| 100.0 | |||
Futures Contracts | (— | )* | |
| Less | than .05% of net assets. |
See accompanying notes which are an integral part of the financial statements.
| 34 | Aggressive Equity Fund |
Table of Contents
(This page intentionally left blank)
Table of Contents
Russell Investment Funds
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
| Non-U.S. Fund | |||
| Total Return | |||
1 Year | 10.12 | % | |
5 Years | 20.51 | %§ | |
10 Years | 8.04 | %§ | |
| MSCI EAFE® Index ** | |||
| Total Return | |||
1 Year | 11.17 | % | |
5 Years | 21.59 | %§ | |
10 Years | 8.66 | %§ | |
| * | Assumes initial investment on January 1, 1998. |
| ** | Morgan Stanley Capital International Europe, Australia, Far East (MSCI EAFE) Index is an index composed of an arithmetic, market value-weighted average of the performance of approximately 1,600 securities listed on the stock exchange of the countries of Europe, Australia, and the Far East. The index is calculated on a total-return basis, which includes reinvestment of gross dividends before deduction of withholding taxes. |
| § | Annualized. |
Performance is historical and assumes reinvestment of all dividends and capital gains. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than when purchased. Past performance is not indicative of future results.
| 36 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
The Non-US Fund (the “Fund”) allocates most of its assets among multiple money managers. Russell Investment Management Company (“RIMCo”), as the Fund’s advisor, may change the allocation of the Fund’s assets among money managers at any time. An exemptive order from the Securities and Exchange Commission (SEC) permits RIMCo to engage or terminate a money manager at any time, subject to the approval by the Fund’s Board without a shareholder vote. Pursuant to the terms of the exemptive order, the Fund is required to notify its shareholders within 60 days of when a money manager begins providing services. The Fund currently has four money managers.
What is the Fund’s investment objective?
The Fund seeks to provide long term capital growth.
How did the Fund perform relative to its benchmark for the fiscal year ended December 31, 2007?
For the fiscal year ended December 31, 2007, the Non-U.S. Fund gained 10.12%. This compared to its benchmark the MSCI EAFE® Index, which gained 11.17%. The Fund’s performance includes operating expenses, whereas Index returns are unmanaged and do not include expenses of any kind.
For the year ended December 31, 2007, the Lipper® International Core Funds (VIP) Average returned 12.36%. This result serves as a peer comparison and is expressed net of operating expenses.
How did the market conditions described in the Market Summary report affect the Fund’s performance?
During 2007, the market was quite narrowly led. This was evident in the Fund by the fact that only one manager, Wellington Management Company, LLP, outperformed the MSCI EAFE Index for the year. The market environment was more challenging for each of the other managers. AQR Capital Management, LLC, a quantitative manager, struggled as increased market volatility late in the year negatively affected quantitative strategies in particular. MFS Institutional Advisors, Inc.’s and Altrinsic Global Advisors, LLC’s emphases on growth-at-a-reasonable-price were not rewarded as the market favored stocks with high growth rates, good price momentum, and high valuations.
The Fund’s largest positions during the period were an underweight position in financials and an overweight to consumer staples. While both of these made a positive contribution to the Fund’s relative performance, the effects were overshadowed by underweight positions in some of the stronger returning sectors, including materials, telecommunications and utilities.
Similarly, the Fund’s regional positioning benefited from underweights of Japan and the United Kingdom, but suffered
from an underweight to Asia ex-Japan and a more modest position than most stronger-performing peers in emerging markets.
How did the investment strategies and techniques employed by the Fund and its money managers affect its performance?
Fund results reflect several key exposures during the period. The primary detractors to performance stemmed from the following underweights relative to the index benchmark and/or peers during the period:
| • | The collective impact of underweights to materials, energy, and telecommunications resulted in missing a substantial opportunity as these sectors provided some of the strongest gains throughout the year. In addition, an overweight of the consumer discretionary sector combined with ineffective security selection also detracted from performance. An underweight of the financials sector made the strongest contribution to performance from a single sector perspective. However, this was overshadowed by the aforementioned underweights. |
| • | The Fund was underweight stocks with high valuations. These stocks produced some of the strongest gains over the period, but gains were concentrated in sectors of the market where earnings were at or near record earnings levels. This created challenges for active managers with any degree of valuation sensitivity with a negative implication for security selection. Wellington’s willingness to pay higher valuations for high growth captured this trend effectively, but it was the only manager to do so. |
Non-index exposure was critical during the year given the strength of emerging markets, as well as strong returns of many Canadian stocks. Exposure to these two regions accounted for the largest contributions to performance from a regional perspective. However, relative to peers, the Fund had less exposure to emerging markets and Canada resulting in less positive contributions to performance in peer-relative terms.
Only one of the four managers in the Fund outperformed for the period. Wellington, the Fund’s aggressive growth manager, was a strong performer with significant contributions from regional positioning (particularly emerging markets and Canada) and strong stock selection in financials, industrials, and technology. In contrast, MFS and Altrinsic’s investment approaches, which were focused on a balanced trade-off between growth and value, were not rewarded. AQR, a quantitative manager, was negatively impacted by a steep sell off affecting quantitative managers in the second half of the year. Its emphasis on stocks with both attractive valuations and momentum was out-of-favor particularly in the latter half of the year.
| Non-U.S. Fund | 37 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
Describe any changes to the Fund’s structure or the money manager line-up.
In May 2007, Altrinsic Global Advisors, LLC was hired to replace The Boston Company Asset Management, LLC.
| Money Managers as of December 31, 2007 | Styles | |
Altrinsic Global Advisors, LLC | Value | |
AQR Capital Management, LLC | Market-Oriented | |
MFS Institutional Advisors, Inc. | Market-Oriented | |
Wellington Management Company, LLP | Growth | |
The views expressed in this report reflect those of the portfolio managers only through the end of the period covered by the report. These views do not necessarily represent the views of Russell Investment Management Company (RIMCo), or any other person in RIMCo or any other affiliated organization. These views are subject to change at any time based upon market conditions or other events, and RIMCo disclaims any responsibility to update the views contained herein. These views should not be relied on as investment advice and, because investment decisions for Russell Investment Funds (RIF) are based on numerous factors, should not be relied on as an indication of investment decisions of any RIF Fund.
| 38 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Shareholder Expense Example — December 31, 2007 (Unaudited)
Fund Expenses
The following disclosure provides important information regarding each Fund’s Expense Example, which appears on each Fund’s individual page in this Annual Report. Please refer to this information when reviewing the Expense Example for a Fund.
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for this Fund is from July 1, 2007 to December 31, 2007.
Actual Expenses
The information in the table under the heading “Actual Performance” provides information about actual account values and actual expenses. You may use the information in this column, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first column in the row entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical Performance (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the information under the heading “Hypothetical Performance (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Actual Performance | Hypothetical Performance (5% return before expenses) | |||||
Beginning Account Value | ||||||
| July 1, 2007 | $ | 1,000.00 | $ | 1,000.00 | ||
Ending Account Value | ||||||
| December 31, 2007 | $ | 1,002.50 | $ | 1,019.41 | ||
Expenses Paid During Period* | $ | 5.80 | $ | 5.85 | ||
| * | Expenses are equal to the Fund’s annualized expense ratio of 1.15% (representing the six month period annualized), multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Reflects amounts waived and/or reimbursed by the investment adviser. Without the waiver and/or reimbursement, expenses would have been higher. |
| Non-U.S. Fund | 39 |
Table of Contents
Russell Investment Funds
Schedule of Investments — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Common Stocks - 90.3% | ||||
Australia - 2.1% | ||||
Adelaide Brighton, Ltd. | 17,542 | 53 | ||
AGL Energy, Ltd. | 2,791 | 33 | ||
Amcor, Ltd. | 5,761 | 35 | ||
AMP, Ltd. | 12,265 | 107 | ||
Ansell, Ltd. | 13,178 | 139 | ||
APN News & Media, Ltd. | 1,926 | 9 | ||
Asciano Group | 1,774 | 11 | ||
ASX, Ltd. | 960 | 51 | ||
Austereo Group, Ltd. | 2,782 | 6 | ||
Australia & New Zealand Banking Group, Ltd. | 13,053 | 313 | ||
BHP Billiton, Ltd. | 27,958 | 980 | ||
BlueScope Steel, Ltd. | 9,876 | 83 | ||
Caltex Australia, Ltd. | 5,746 | 97 | ||
Centro Properties Group (ö) | 6,423 | 6 | ||
CFS Retail Property Trust (ö) | 4,243 | 9 | ||
Challenger Financial Services Group, Ltd. | 17,805 | 77 | ||
Coca-Cola Amatil, Ltd. | 9,635 | 80 | ||
Commonwealth Bank of Australia | 9,434 | 487 | ||
CSL, Ltd. | 27,228 | 865 | ||
CSR, Ltd. (Ñ) | 14,571 | 40 | ||
DB RREEF Trust (ö) | 28,562 | 50 | ||
Goodman Fielder, Ltd. | 72,155 | 120 | ||
Goodman Group (ö) | 8,246 | 35 | ||
GPT Group (ö) | 13,500 | 48 | ||
Harvey Norman Holdings, Ltd. | 11,871 | 71 | ||
ING Industrial Fund (ö) | 1,357 | 3 | ||
Insurance Australia Group, Ltd. | 8,788 | 32 | ||
Leighton Holdings, Ltd. (Ñ) | 15,121 | 806 | ||
Macquarie Airports | 1,354 | 5 | ||
Macquarie Group, Ltd. | 475 | 31 | ||
Macquarie Infrastructure Group | 18,627 | 49 | ||
Macquarie Office Trust (ö) | 10,185 | 13 | ||
Mirvac Group (ö) | 6,629 | 35 | ||
National Australia Bank, Ltd. | 36,045 | 1,189 | ||
Newcrest Mining, Ltd. | 289 | 8 | ||
Orica, Ltd. | 2,210 | 61 | ||
Origin Energy, Ltd. | 8,697 | 67 | ||
Pacific Brands, Ltd. | 49,459 | 141 | ||
PaperlinX, Ltd. | 20,959 | 49 | ||
Qantas Airways, Ltd. | 40,977 | 195 | ||
QBE Insurance Group, Ltd. | 25,148 | 733 | ||
Rio Tinto, Ltd. (Ñ) | 2,990 | 349 | ||
Santos, Ltd. | 15,899 | 197 | ||
Sons of Gwalia, Ltd. (Æ)(Ñ)(ß) | 8,400 | — |
| Principal Amount ($) or Shares | Market Value $ | |||
Stockland (ö) | 9,521 | 70 | ||
Suncorp-Metway, Ltd. | 5,081 | 75 | ||
Symbion Health, Ltd. | 4,125 | 14 | ||
TABCORP Holdings, Ltd. | 3,308 | 43 | ||
Telstra Corp., Ltd. | 35,749 | 140 | ||
Toll Holdings, Ltd. | 2,278 | 23 | ||
Wesfarmers, Ltd. | 1,120 | 40 | ||
Wesfarmers, Ltd. (Æ) | 1,120 | 40 | ||
Westfield Group (ö) | 13,530 | 248 | ||
Westpac Banking Corp. | 11,549 | 281 | ||
Woodside Petroleum, Ltd. | 1,222 | 54 | ||
Woolworths, Ltd. | 8,034 | 238 | ||
WorleyParsons, Ltd. | 567 | 26 | ||
Zinifex, Ltd. | 864 | 9 | ||
| 9,069 | ||||
Austria - 0.5% | ||||
Erste Bank der Oesterreichischen Sparkassen AG | 29,053 | 2,065 | ||
Belgium - 0.4% | ||||
D’ieteren SA | 66 | 24 | ||
Delhaize Group | 1,756 | 154 | ||
Hansen Transmissions International NV (Æ) | 102,035 | 585 | ||
KBC Groep NV | 1,267 | 177 | ||
Nationale A Portefeuille | 427 | 30 | ||
Solvay SA | 4,961 | 691 | ||
| 1,661 | ||||
Bermuda - 1.2% | ||||
Benfield Group, Ltd. | 138,664 | 777 | ||
Catlin Group, Ltd. | 2,688 | 20 | ||
Cnpc Hong Kong, Ltd. | 50,000 | 32 | ||
Esprit Holdings, Ltd. | 8,200 | 120 | ||
Giordano International, Ltd. | 14,000 | 7 | ||
Guoco Group, Ltd. | 2,000 | 27 | ||
Investco, Ltd. (Æ) | 80,777 | 2,524 | ||
Jardine Matheson Holdings, Ltd. | 3,200 | 88 | ||
Jardine Strategic Holdings, Ltd. | 3,000 | 47 | ||
Li & Fung, Ltd. | 206,000 | 823 | ||
Noble Group, Ltd. | 22,000 | 37 | ||
Orient Overseas International, Ltd. | 6,300 | 46 | ||
Seadrill, Ltd. (Æ) | 26,300 | 633 | ||
VTech Holdings, Ltd. | 4,719 | 34 | ||
| 5,215 | ||||
Brazil - 0.5% | ||||
Bolsa de Mercadorias e Futuros (Æ) | 56,300 | 791 | ||
| 40 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Cia Vale do Rio Doce - ADR | 14,800 | 483 | ||
Petroleo Brasileiro SA - ADR | 6,600 | 761 | ||
| 2,035 | ||||
Canada - 1.0% | ||||
Canadian National Railway Co. (Ñ) | 22,190 | 1,041 | ||
Gammon Gold, Inc. (Æ) | 47,624 | 384 | ||
Potash Corp. of Saskatchewan | 13,000 | 1,872 | ||
Research In Motion, Ltd. (Æ) | 5,600 | 635 | ||
Suncor Energy, Inc. | 5,000 | 547 | ||
| 4,479 | ||||
Cayman Islands - 0.7% | ||||
Alibaba.com, Ltd. (Æ)(Þ) | 181,200 | 642 | ||
ASM Pacific Technology | 4,500 | 33 | ||
Focus Media Holding, Ltd. - ADR (Æ)(Ñ) | 2,200 | 125 | ||
Kingboard Chemical Holdings, Ltd. | 12,500 | 74 | ||
Suntech Power Holdings Co., Ltd. - ADR (Æ)(Ñ) | 24,400 | 2,009 | ||
Tencent Holdings, Ltd. | 5,000 | 37 | ||
| 2,920 | ||||
China - 0.1% | ||||
China Communications Construction Co., Ltd. Class H | 104,000 | 268 | ||
Czech Republic - 0.2% | ||||
Komercni Banka AS | 3,164 | 760 | ||
Denmark - 1.0% | ||||
Carlsberg A/S Class B | 3,700 | 445 | ||
East Asiatic Co., Ltd. A/S | 1,325 | 103 | ||
FLSmidth & Co. A/S | 400 | 41 | ||
Novo Nordisk A/S Series B | 7,850 | 512 | ||
Rockwool International AS Class B (Ñ) | 145 | 33 | ||
Vestas Wind Systems A/S (Æ) | 28,100 | 3,004 | ||
| 4,138 | ||||
Egypt - 0.4% | ||||
Orascom Telecom Holding SAE - GDR | 19,200 | 1,590 | ||
Finland - 1.6% | ||||
Kesko OYJ Class B | 4,139 | 227 | ||
Metso OYJ | 1,272 | 69 | ||
Nokia OYJ | 154,598 | 5,953 | ||
OKO Bank PLC Class A | 5,204 | 99 | ||
Oriola-KD OYJ | 3,400 | 15 | ||
Orion OYJ Class B | 7,439 | 173 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Outotec OYJ | 3,925 | 213 | ||
Rautaruukki OYJ | 2,904 | 123 | ||
Stora Enso OYJ Class R | 4,445 | 66 | ||
UPM-Kymmene OYJ | 5,318 | 106 | ||
| 7,044 | ||||
France - 12.9% | ||||
ADP (Æ) | 416 | 42 | ||
Air Liquide | 15,418 | 2,284 | ||
Alcatel-Lucent - ADR (Ñ) | 125,840 | 921 | ||
Alstom | 11,293 | 2,400 | ||
Arkema (Æ) | 6,044 | 394 | ||
AXA SA | 67,526 | 2,689 | ||
BNP Paribas | 17,087 | 1,837 | ||
Bouygues (Ñ) | 274 | 23 | ||
Business Objects SA (Æ) | 374 | 23 | ||
Carrefour SA | 21,113 | 1,637 | ||
Casino Guichard Perrachon SA (Ñ) | 2,400 | 261 | ||
Christian Dior SA | 1,470 | 192 | ||
Cie de Saint-Gobain | 1,483 | 141 | ||
Cie Generale de Geophysique-Veritas (Æ) | 1,153 | 324 | ||
Ciments Francais SA | 180 | 31 | ||
CNP Assurances | 3,732 | 484 | ||
Credit Agricole SA | 40,563 | 1,361 | ||
France Telecom SA | 49,609 | 1,780 | ||
Gaz de France SA (Ñ) | 23,789 | 1,385 | ||
Ipsen | 691 | 42 | ||
Klepierre (ö) | 767 | 39 | ||
L’Oreal SA | 10,667 | 1,523 | ||
Lafarge SA | 452 | 82 | ||
Legrand SA | 44,959 | 1,527 | ||
LVMH Moet Hennessy Louis | 32,732 | 3,934 | ||
NicOx SA (Æ)(Ñ) | 4,249 | 68 | ||
Pernod-Ricard SA | 9,362 | 2,156 | ||
Peugeot SA | 1,907 | 143 | ||
Publicis Groupe | 10,810 | 420 | ||
Rallye SA (Æ) | 1,254 | 89 | ||
Sanofi-Aventis SA | 36,204 | 3,309 | ||
Schneider Electric SA (Ñ) | 25,560 | 3,418 | ||
SEB SA | 392 | 71 | ||
Societe BIC SA | 2,159 | 154 | ||
Societe Generale | 5,707 | 816 | ||
Societe Television Francaise 1 | 22,156 | 590 | ||
Suez SA | 27,830 | 1,886 | ||
Suez SA | 1,228 | — | ||
Teleperformance | 1,666 | 65 | ||
| Non-U.S. Fund | 41 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Thales SA | 9,622 | 570 | ||
Thomson (Æ) | 5,255 | 74 | ||
Total SA | 86,364 | 7,167 | ||
UBISOFT Entertainment (Æ) | 3,752 | 378 | ||
Unibail-Rodamco (ö) | 715 | 156 | ||
Valeo SA (Ñ) | 3,884 | 159 | ||
Vallourec (Ñ) | 569 | 153 | ||
Veolia Environnement | 39,234 | 3,563 | ||
Vivendi (Ñ) | 111,602 | 5,085 | ||
| 55,846 | ||||
Germany - 8.3% | ||||
Allianz SE | 8,134 | 1,740 | ||
Altana AG | 17,789 | 430 | ||
Arcandor AG (Æ)(Ñ) | 107,309 | 2,542 | ||
Arques Industries AG (Ñ) | 7,880 | 269 | ||
BASF AG | 5,767 | 852 | ||
Bayer AG (Ñ) | 46,270 | 4,219 | ||
Bayerische Motoren Werke AG (Ñ) | 22,330 | 1,379 | ||
Daimler AG | 36,292 | 3,515 | ||
Deutsche Bank AG | 3,443 | 445 | ||
Deutsche Boerse AG | 9,993 | 1,973 | ||
Deutsche Telekom AG | 49,245 | 1,077 | ||
E.ON AG (Ñ) | 18,417 | 3,910 | ||
Epcos AG | 14,770 | 255 | ||
Freenet AG (Ñ) | 4,501 | 105 | ||
Hochtief AG | 2,446 | 326 | ||
Kloeckner & Co. AG | 4,175 | 166 | ||
KUKA AG (Æ) | 5,689 | 213 | ||
Lanxess AG (Ñ) | 9,474 | 460 | ||
Linde AG | 21,320 | 2,808 | ||
Merck KGAA | 13,400 | 1,721 | ||
Metro AG | 28,011 | 2,338 | ||
MTU Aero Engines Holding AG | 4,235 | 246 | ||
Norddeutsche Affinerie AG (Ñ) | 2,972 | 115 | ||
RWE AG | 3,167 | 444 | ||
Salzgitter AG | 5,646 | 831 | ||
Siemens AG | 17,541 | 2,754 | ||
Suedzucker AG (Ñ) | 4,988 | 117 | ||
ThyssenKrupp AG | 897 | 50 | ||
Volkswagen AG (Ñ) | 2,296 | 522 | ||
Vossloh AG | 1,900 | 222 | ||
| 36,044 | ||||
Greece - 0.2% | ||||
National Bank of Greece SA | 10,329 | 712 | ||
Hong Kong - 0.8% | ||||
BOC Hong Kong Holdings, Ltd. | 43,000 | 119 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Cathay Pacific Airways, Ltd. | 12,000 | 31 | ||
Cheung Kong Holdings, Ltd. | 49,640 | 905 | ||
China Resources Enterprise | 72,000 | 307 | ||
China Unicom, Ltd. | 4,000 | 9 | ||
CLP Holdings, Ltd. | 11,500 | 78 | ||
Hang Lung Group, Ltd. | 6,000 | 32 | ||
Hang Lung Properties, Ltd. | 4,000 | 18 | ||
Hang Seng Bank, Ltd. | 3,000 | 61 | ||
Henderson Land Development Co., Ltd. | 9,000 | 83 | ||
Hong Kong & China Gas Co. | 5,000 | 15 | ||
Hong Kong Exchanges and Clearing, Ltd. | 7,500 | 211 | ||
HongKong Electric Holdings | 11,500 | 66 | ||
Hopewell Holdings | 22,000 | 101 | ||
Hutchison Whampoa, Ltd. | 11,000 | 124 | ||
Hysan Development Co., Ltd. | 6,000 | 17 | ||
Industrial and Commercial Bank of China Asia, Ltd. | 2,000 | 5 | ||
Link REIT (The) (ö) | 12,500 | 27 | ||
Minmetals Resources, Ltd. | 40,000 | 22 | ||
New World Development, Ltd. | 14,000 | 49 | ||
Sun Hung Kai Properties, Ltd. | 38,000 | 799 | ||
Swire Pacific, Ltd. | 9,000 | 123 | ||
Techtronic Industries Co. | 6,500 | 7 | ||
Television Broadcasts, Ltd. | 9,000 | 54 | ||
Wharf Holdings, Ltd. | 16,000 | 83 | ||
Wheelock & Co., Ltd. | 16,000 | 49 | ||
| 3,395 | ||||
India - 0.2% | ||||
Satyam Computer Services, Ltd. - ADR | 31,100 | 831 | ||
Indonesia - 0.1% | ||||
Bank Central Asia Tbk PT | 245,500 | 189 | ||
Telekomunikasi Indonesia Tbk PT - ADR | 1,750 | 73 | ||
| 262 | ||||
Ireland - 0.5% | ||||
Elan Corp. PLC - ADR (Æ)(Ñ) | 64,300 | 1,413 | ||
Ryanair Holdings PLC - ADR (Æ)(Ñ) | 19,710 | 778 | ||
| 2,191 | ||||
Italy - 3.5% | ||||
Alleanza Assicurazioni SpA | 93,388 | 1,200 | ||
Ansaldo STS SpA (Æ) | 68,608 | 867 | ||
| 42 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Arnoldo Mondadori Editore SpA (Ñ) | 105,444 | 858 | ||
Assicurazioni Generali SpA | 16,253 | 729 | ||
Danieli SPA (Æ) | 2,115 | 50 | ||
Enel SpA | 42,845 | 506 | ||
ENI SpA | 72,544 | 2,643 | ||
Fiat SpA | 19,870 | 511 | ||
Finmeccanica SpA | 5,693 | 180 | ||
Fondiaria-Sai SpA | 8,774 | 362 | ||
Impregilo SPA (Æ) | 29,685 | 199 | ||
Indesit Co. SpA | 8,743 | 134 | ||
Intesa Sanpaolo SpA | 189,425 | 1,486 | ||
Mediaset SpA | 205,256 | 2,064 | ||
Milano Assicurazioni SPA | 33,598 | 261 | ||
Parmalat Finanziaria SpA (Ñ)(Æ)(ß) | 12,500 | — | ||
Prysmian SpA (Æ) | 2,317 | 57 | ||
Telecom Italia SpA | 878,082 | 2,064 | ||
UniCredito Italiano SpA | 89,635 | 746 | ||
Unione di Banche Italiane SCPA | 1,315 | 36 | ||
| 14,953 | ||||
Japan - 15.8% | ||||
77 Bank, Ltd. (The) | 12,000 | 75 | ||
Aeon Credit Service Co., Ltd. | 43,100 | 637 | ||
Alfresa Holdings Corp. (Ñ) | 1,500 | 91 | ||
Alpine Electronics, Inc. | 3,000 | 50 | ||
Alps Electric Co., Ltd. | 10,100 | 131 | ||
AOC Holdings, Inc. | 4,300 | 63 | ||
Asahi Glass Co., Ltd. (Ñ) | 98,000 | 1,300 | ||
Asahi Kasei Corp. (Ñ) | 27,000 | 180 | ||
Astellas Pharma, Inc. (Ñ) | 9,900 | 432 | ||
Awa Bank, Ltd. (The) | 3,000 | 17 | ||
Bank of Yokohama, Ltd. (The) (Ñ) | 33,000 | 233 | ||
Bosch Corp. (Ñ) | 38,000 | 186 | ||
Bridgestone Corp. (Ñ) | 46,100 | 812 | ||
Brother Industries, Ltd. (Ñ) | 3,700 | 48 | ||
Canon Marketing Japan, Inc. (Ñ) | 2,800 | 52 | ||
Canon, Inc. (Ñ) | 74,700 | 3,413 | ||
Capcom Co., Ltd. (Ñ) | 2,100 | 54 | ||
Chuo Mitsui Trust Holdings, Inc. | 4,000 | 31 | ||
COMSYS Holdings Corp. | 19,000 | 156 | ||
Daihatsu Motor Co., Ltd. | 5,000 | 47 | ||
Daiichi Sankyo Co., Ltd. | 1,900 | 58 | ||
Daishi Bank, Ltd. (The) | 5,000 | 20 | ||
Daiwa House Industry Co., Ltd. | 84,420 | 1,086 | ||
Daiwa Securities Group, Inc. | 68,950 | 635 | ||
Denki Kagaku Kogyo K K | 18,000 | 78 | ||
Eisai Co., Ltd. | 1,400 | 55 | ||
Exedy Corp. | 1,200 | 40 | ||
Ezaki Glico Co., Ltd. (Ñ) | 2,000 | 20 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
FamilyMart Co., Ltd. | 2,600 | 81 | ||
Fanuc, Ltd. | 11,200 | 1,093 | ||
FCC Co., Ltd. | 2,300 | 41 | ||
Fuji Fire & Marine Insurance Co., Ltd. (The) | 32,000 | 86 | ||
Fuji Television Network, Inc. | 554 | 919 | ||
FUJIFILM Holdings Corp. | 4,800 | 203 | ||
Fujitsu, Ltd. (Ñ) | 11,000 | 74 | ||
H2O Retailing Corp. (Ñ) | 8,000 | 62 | ||
Hachijuni Bank, Ltd. (The) (Ñ) | 25,000 | 168 | ||
Higo Bank, Ltd. (The) | 6,000 | 39 | ||
Hino Motors, Ltd. | 34,000 | 220 | ||
Hirose Electric Co., Ltd. (Ñ) | 7,100 | 823 | ||
Hitachi Kokusai Electric, Inc. | 6,000 | 74 | ||
Hitachi, Ltd. | 14,000 | 103 | ||
Hokkaido Electric Power Co., Inc. | 2,300 | 50 | ||
Hokkoku Bank, Ltd. (The) | 7,000 | 32 | ||
Honda Motor Co., Ltd. (Ñ) | 6,100 | 202 | ||
Hyakujushi Bank, Ltd. (The) | 3,000 | 15 | ||
Idemitsu Kosan Co., Ltd. (Ñ) | 400 | 42 | ||
Inpex Holdings, Inc. | 174 | 1,872 | ||
ITOCHU Corp. (Ñ) | 29,000 | 282 | ||
Iyo Bank, Ltd. (The) | 6,000 | 58 | ||
Japan Steel Works, Ltd. (The) | 6,000 | 88 | ||
Japan Tobacco, Inc. (Ñ) | 268 | 1,589 | ||
JFE Holdings, Inc. | 6,600 | 333 | ||
JFE Shoji Holdings, Inc. | 26,000 | 166 | ||
JGC Corp. | 12,000 | 206 | ||
Joyo Bank, Ltd. (The) | 266,940 | 1,488 | ||
Juki Corp. | 22,000 | 135 | ||
Kagoshima Bank, Ltd. (The) | 12,000 | 82 | ||
Kansai Electric Power Co., Inc. (The) | 9,700 | 226 | ||
Kao Corp. (Ñ) | 132,000 | 3,972 | ||
Kawasaki Kisen Kaisha, Ltd. | 14,000 | 137 | ||
KDDI Corp. | 47 | 349 | ||
Keihin Corp. | 3,600 | 64 | ||
Keiyo Bank, Ltd. (The) (Ñ) | 14,000 | 80 | ||
Kintetsu World Express, Inc. | 3,500 | 121 | ||
Kobe Steel, Ltd. | 68,000 | 220 | ||
Komatsu, Ltd. (Ñ) | 4,300 | 116 | ||
Komori Corp. | 3,000 | 67 | ||
Kose Corp. (Ñ) | 58,240 | 1,552 | ||
Kyocera Corp. | 1,200 | 105 | ||
Kyoei Steel, Ltd. | 1,400 | 26 | ||
Kyowa Hakko Kogyo Co., Ltd. (Ñ) | 2,000 | 21 | ||
Leopalace21 Corp. | 1,600 | 43 | ||
Makino Milling Machine Co., Ltd. | 5,000 | 35 | ||
Makita Corp. | 1,600 | 67 | ||
Marubeni Corp. | 7,000 | 49 |
| Non-U.S. Fund | 43 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Matsushita Electric Industrial Co., Ltd. | 19,000 | 389 | ||
Matsushita Electric Works, Ltd. | 19,000 | 211 | ||
Mazda Motor Corp. | 19,000 | 95 | ||
Meiji Dairies Corp. | 15,000 | 76 | ||
MID Reit, Inc. (ö)(Ñ) | 138 | 644 | ||
Millea Holdings, Inc. | 5,800 | 196 | ||
Mitsubishi Chemical Holdings Corp. | 10,500 | 80 | ||
Mitsubishi Corp. | 8,300 | 226 | ||
Mitsubishi Electric Corp. | 10,000 | 103 | ||
Mitsubishi Estate Co., Ltd. | 10,000 | 240 | ||
Mitsubishi Heavy Industries, Ltd. | 20,000 | 86 | ||
Mitsubishi Materials Corp. | 19,000 | 81 | ||
Mitsubishi UFJ Financial Group, Inc. | 117,630 | 1,095 | ||
Mitsui & Co., Ltd. (Ñ) | 11,000 | 233 | ||
Mitsui Fudosan Co., Ltd. | 8,000 | 173 | ||
Mitsui OSK Lines, Ltd. | 16,000 | 203 | ||
Mitsui Sumitomo Insurance Co., Ltd. | 45,980 | 449 | ||
Mitsui-Soko Co., Ltd. | 114,560 | 614 | ||
Mizuho Financial Group, Inc. | 37 | 176 | ||
Mori Seiki Co., Ltd. (Ñ) | 800 | 16 | ||
New City Residence Investment Corp. (ö) | 94 | 383 | ||
Nichirei Corp. | 35,000 | 145 | ||
Nifco, Inc. | 800 | 19 | ||
Nikko Cordial Corp. (Æ)(Ñ) | 2,000 | 30 | ||
Nintendo Co., Ltd. | 3,800 | 2,307 | ||
Nippon Commercial Investment Corp. (ö) | 179 | 789 | ||
Nippon Express Co., Ltd. | 37,000 | 189 | ||
Nippon Kayaku Co., Ltd. | 18,000 | 117 | ||
Nippon Konpo Unyu Soko Co., Ltd. | 3,000 | 40 | ||
Nippon Mining Holdings, Inc. | 6,000 | 39 | ||
Nippon Oil Corp. | 38,000 | 310 | ||
Nippon Residential Investment Corp. (ö) | 117 | 526 | ||
Nippon Seiki Co., Ltd. | 1,000 | 22 | ||
Nippon Steel Corp. | 52,000 | 320 | ||
Nippon Telegraph & Telephone Corp. | 73 | 361 | ||
Nippon Yusen KK | 11,000 | 88 | ||
Nipponkoa Insurance Co., Ltd. (Ñ) | 239,490 | 2,171 | ||
Nissan Motor Co., Ltd. (Ñ) | 17,000 | 184 | ||
Nissan Shatai Co., Ltd. (Æ) | 9,000 | 73 | ||
Nisshin Seifun Group, Inc. | 5,000 | 50 | ||
Nisshin Steel Co., Ltd. (Ñ) | 8,000 | 28 | ||
Nisshinbo Industries, Inc. (Ñ) | 2,000 | 24 | ||
Nissin Kogyo Co., Ltd. | 6,200 | 145 | ||
Nomura Holdings, Inc. (Ñ) | 146,620 | 2,451 | ||
NTN Corp. (Ñ) | 16,000 | 139 |
| Principal Amount ($) or Shares | Market Value $ | |||
Okinawa Electric Power Co., Inc. (The) | 600 | 28 | ||
OKUMA Corp. | 1,000 | 11 | ||
Omron Corp. | 36,300 | 859 | ||
ORIX Corp. | 830 | 139 | ||
Pacific Metals Co., Ltd. (Ñ) | 2,000 | 19 | ||
Resona Holdings, Inc. (Ñ) | 35 | 64 | ||
Ricoh Co., Ltd. | 87,000 | 1,600 | ||
Sankyo Co., Ltd. | 2,200 | 102 | ||
Santen Pharmaceutical Co., Ltd. | 2,100 | 52 | ||
Sanwa Holdings Corp. (Ñ) | 6,000 | 30 | ||
Sasebo Heavy Industries Co., Ltd. | 5,000 | 23 | ||
Seiko Epson Corp. | 1,400 | 30 | ||
Seino Holdings Corp. (Ñ) | 2,000 | 14 | ||
Sekisui House, Ltd. | 5,000 | 54 | ||
Seven & I Holdings Co., Ltd. | 35,460 | 1,031 | ||
Sharp Corp. (Ñ) | 7,000 | 125 | ||
Shiga Bank, Ltd. (The) | 10,000 | 67 | ||
Shima Seiki Manufacturing, Ltd. | 500 | 23 | ||
Shin-Etsu Chemical Co., Ltd. | 12,700 | 794 | ||
Shinwa Kaiun Kaisha, Ltd. | 9,000 | 54 | ||
Shizuoka Bank, Ltd. (The) | 55,000 | 605 | ||
Showa Shell Sekiyu KK (Ñ) | 10,205 | 114 | ||
SMC Corp. | 13,748 | 1,636 | ||
Sohgo Security Services Co., Ltd. | 2,000 | 32 | ||
Sony Corp. (Ñ) | 30,900 | 1,677 | ||
Star Micronics Co., Ltd. | 2,100 | 46 | ||
Sugi Pharmacy Co., Ltd. (Ñ) | 36,340 | 1,041 | ||
Sumco Techxiv Corp. (Ñ) | 600 | 21 | ||
Sumitomo Bakelite Co., Ltd. (Ñ) | 188,250 | 1,131 | ||
Sumitomo Corp. | 6,700 | 95 | ||
Sumitomo Heavy Industries, Ltd. (Ñ) | 13,000 | 119 | ||
Sumitomo Metal Industries, Ltd. | 14,000 | 65 | ||
Sumitomo Metal Mining Co., Ltd. | 1,000 | 17 | ||
Sumitomo Mitsui Financial Group, Inc. (Ñ) | 17 | 127 | ||
Sumitomo Realty & Development Co., Ltd. | 2,000 | 49 | ||
Sumitomo Trust & Banking Co., Ltd. (The) | 312,660 | 2,082 | ||
Suzuki Motor Corp. | 35,760 | 1,076 | ||
Takeda Pharmaceutical Co., Ltd. | 33,420 | 1,954 | ||
TDK Corp. | 4,100 | 304 | ||
THK Co., Ltd. | 500 | 10 | ||
Toho Co., Ltd. (Ñ) | 3,100 | 69 | ||
Toho Pharmaceutical Co., Ltd. | 5,590 | 109 | ||
Tokai Rubber Industries, Inc. | 8,400 | 144 | ||
Tokyo Electric Power Co., Inc. (The) (Ñ) | 9,500 | 246 |
| 44 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Tokyo Gas Co., Ltd. | 159,000 | 742 | ||
Tokyu Land Corp. (Ñ) | 8,000 | 68 | ||
TonenGeneral Sekiyu KK (Ñ) | 7,000 | 69 | ||
Toshiba Corp. (Ñ) | 20,000 | 149 | ||
Toshiba TEC Corp. | 20,000 | 135 | ||
Toyo Engineering Corp. | 17,000 | 84 | ||
Toyo Ink Manufacturing Co., Ltd. | 5,000 | 17 | ||
Toyo Seikan Kaisha, Ltd. (Ñ) | 1,500 | 27 | ||
Toyo Suisan Kaisha, Ltd. | 15,000 | 273 | ||
Toyota Auto Body Co., Ltd. | 4,400 | 71 | ||
Toyota Boshoku Corp. | 800 | 26 | ||
Toyota Motor Corp. (Ñ) | 50,800 | 2,734 | ||
United Urban Investment Corp. (ö) | 80 | 537 | ||
West Japan Railway Co. | 17 | 84 | ||
Yamada Denki Co., Ltd. (Ñ) | 4,220 | 480 | ||
Yamaha Corp. | 6,700 | 153 | ||
Yamato Holdings Co., Ltd. | 14,000 | 202 | ||
Yamato Kogyo Co., Ltd. | 3,400 | 139 | ||
Yokohama Rubber Co., Ltd. (The) | 11,000 | 65 | ||
| 68,155 | ||||
Luxembourg - 0.7% | ||||
ArcelorMittal | 4,694 | 361 | ||
Millicom International Cellular SA (Æ)(Ñ) | 19,900 | 2,347 | ||
SES | 13,157 | 345 | ||
| 3,053 | ||||
Mexico - 0.1% | ||||
Grupo Modelo SAB de CV | 56,000 | 264 | ||
Netherlands - 4.2% | ||||
Akzo Nobel NV | 4,056 | 323 | ||
ASM International NV | 7,555 | 185 | ||
ASML Holding NV (Æ) | 67,526 | 2,122 | ||
CSM | 1,286 | 43 | ||
Fugro NV | 609 | 47 | ||
Heineken NV | 63,842 | 4,112 | ||
ING Groep NV | 39,169 | 1,529 | ||
Koninklijke Ahold NV (Æ) | 5,211 | 72 | ||
Koninklijke Philips Electronics NV | 39,155 | 1,697 | ||
OCE NV (Ñ) | 23,090 | 416 | ||
Rodamco Europe NV (ö) | 817 | 102 | ||
Royal KPN NV | 7,397 | 134 | ||
TNT NV | 55,160 | 2,295 | ||
TomTom NV (Æ)(Ñ) | 4,003 | 299 | ||
Unilever NV | 132,463 | 4,850 | ||
| 18,226 | ||||
| Principal Amount ($) or Shares | Market Value $ | |||
Netherlands Antilles - 0.0% | ||||
Hunter Douglas NV | 1,774 | 131 | ||
Norway - 0.2% | ||||
StatoilHydro ASA | 30,502 | 943 | ||
Papua New Guinea - 0.0% | ||||
Oil Search, Ltd. | 2,425 | 10 | ||
Portugal - 0.2% | ||||
Energias de Portugal SA | 148,542 | 966 | ||
Russia - 0.4% | ||||
Gazprom OAO - ADR | 30,200 | 1,701 | ||
Singapore - 0.7% | ||||
Allgreen Properties, Ltd. | 40,000 | 41 | ||
Ascendas Real Estate Investment Trust (Æ)(ö) | 4,000 | 7 | ||
CapitaCommercial Trust (Æ)(ö) | 2,000 | 3 | ||
CapitaLand, Ltd. | 11,000 | 47 | ||
CapitaMall Trust (ö) | 4,000 | 9 | ||
China Aviation Oil Singapore Corp., Ltd. | 6,000 | 9 | ||
Cosco Corp. Singapore, Ltd. | 6,000 | 24 | ||
Creative Technology, Ltd. | 3,600 | 16 | ||
DBS Group Holdings, Ltd. | 44,000 | 623 | ||
Haw Par Corp., Ltd. | 2,000 | 10 | ||
Jardine Cycle & Carriage, Ltd. | 1,000 | 15 | ||
Keppel Corp., Ltd. | 10,000 | 89 | ||
NatSteel, Ltd. | 10,000 | 10 | ||
Neptune Orient Lines, Ltd. | 16,000 | 43 | ||
Oversea-Chinese Banking Corp. | 13,000 | 75 | ||
Pacific Century Regional Developments, Ltd. (Æ) | 68,000 | 16 | ||
SembCorp Industries, Ltd. | 10,880 | 43 | ||
Singapore Airlines, Ltd. | 9,470 | 113 | ||
Singapore Petroleum Co., Ltd. | 8,000 | 42 | ||
Singapore Technologies Engineering, Ltd. | 1,000 | 3 | ||
Singapore Telecommunications, Ltd. | 619,000 | 1,699 | ||
STATS ChipPAC, Ltd. (Æ) | 3,425 | 4 | ||
Suntec Real Estate Investment Trust (Æ)(ö) | 3,000 | 3 | ||
United Overseas Bank, Ltd. | 8,000 | 111 | ||
Wing Tai Holdings, Ltd. | 13,000 | 24 | ||
| 3,079 | ||||
South Africa - 0.1% | ||||
MTN Group, Ltd. | 22,200 | 416 | ||
| Non-U.S. Fund | 45 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
South Korea - 0.8% | ||||
Kookmin Bank - ADR (Ñ) | 14,070 | 1,032 | ||
LG Electronics, Inc. (Æ) | 9,333 | 983 | ||
Samsung Electronics Co., Ltd. | 2,816 | 1,655 | ||
| 3,670 | ||||
Spain - 2.2% | ||||
Altadis SA | 1,592 | 116 | ||
Banco Bilbao Vizcaya Argentaria SA | 49,515 | 1,216 | ||
Banco Santander SA | 48,633 | 1,051 | ||
Bolsas y Mercados Espanoles (Æ) | 611 | 41 | ||
Gamesa Corp. Tecnologica SA | 26,985 | 1,248 | ||
Gas Natural SDG SA (Ñ) | 364 | 21 | ||
Gestevision Telecinco SA | 6,557 | 166 | ||
Grifols SA | 881 | 20 | ||
Iberdrola Renovables (Æ) | 177,697 | 1,468 | ||
Iberdrola SA | 5,784 | 87 | ||
Iberia Lineas Aereas de Espana | 43,891 | 190 | ||
Inditex SA | 3,115 | 189 | ||
Repsol YPF SA | 10,826 | 386 | ||
Tecnicas Reunidas SA | 2,143 | 136 | ||
Telefonica SA | 96,420 | 3,116 | ||
Union Fenosa SA | 398 | 27 | ||
Vertice Trescientos Sesenta Grados SA (Æ) | 4,020 | 13 | ||
| 9,491 | ||||
Sweden - 1.3% | ||||
Alfa Laval AB | 1,625 | 90 | ||
Boliden AB (Æ) | 7,900 | 98 | ||
Electrolux AB | 25,100 | 418 | ||
Industrivarden AB Class A | 3,500 | 61 | ||
Nordea Bank AB | 86,810 | 1,440 | ||
OMX AB | 500 | 20 | ||
Peab AB | 2,000 | 20 | ||
Peab Industri AB (Æ) | 1,000 | 9 | ||
SAS AB (Æ) | 12,700 | 162 | ||
Scania AB Class B (Æ) | 21,800 | 515 | ||
Skandinaviska Enskilda Banken AB Class A | 7,000 | 177 | ||
SKF AB Class B | 14,000 | 235 | ||
Ssab Svenskt Stal AB Series A | 12,600 | 338 | ||
Telefonaktiebolaget LM Ericsson Series B Class B | 713,330 | 1,668 | ||
TeliaSonera AB | 29,500 | 274 | ||
Volvo AB (Æ) | ||||
Class A | 3,400 | 56 | ||
Class B | 5,700 | 95 | ||
| 5,676 | ||||
| Principal Amount ($) or Shares | Market Value $ | |||
Switzerland - 8.3% | ||||
ABB, Ltd. | 10,779 | 311 | ||
Actelion, Ltd. (Æ)(Ñ) | 13,680 | 623 | ||
Baloise Holding AG | 837 | 83 | ||
Bucher Industries AG (Æ) | 104 | 24 | ||
Ciba Specialty Chemicals AG | 1,792 | 83 | ||
Credit Suisse Group | 13,998 | 842 | ||
Georg Fischer AG (Æ) | 80 | 49 | ||
Givaudan SA | 2,130 | 2,046 | ||
Helvetia Holding AG | 532 | 191 | ||
Julius Baer Holding AG | 39,498 | 3,211 | ||
Kuoni Reisen Holding AG | 93 | 48 | ||
Logitech International SA (Æ) | 75,790 | 2,752 | ||
Nestle SA | 22,754 | 10,426 | ||
Novartis AG | 16,418 | 894 | ||
Rieter Holding AG | 41 | 18 | ||
Roche Holding AG | 30,829 | 5,310 | ||
Sika AG | 50 | 94 | ||
Sonova Holding AG | 21,737 | 2,431 | ||
Swatch Group AG | 2,189 | 656 | ||
Swiss Life Holding (Æ) | 1,197 | 296 | ||
Swiss Reinsurance | 29,177 | 2,047 | ||
Swisscom AG | 277 | 108 | ||
UBS AG | 66,982 | 3,111 | ||
Zurich Financial Services AG | 678 | 200 | ||
| 35,854 | ||||
Taiwan - 0.2% | ||||
Taiwan Semiconductor Manufacturing Co., Ltd. - ADR | 87,390 | 870 | ||
Thailand - 0.1% | ||||
Bangkok Bank PCL | 173,500 | 613 | ||
Turkey - 0.2% | ||||
Turkcell Iletisim Hizmet AS - ADR | 29,900 | 824 | ||
United Kingdom - 18.2% | ||||
3i Group PLC | 823 | 16 | ||
Amec PLC | 14,568 | 242 | ||
Anglo American PLC | 9,642 | 584 | ||
Antofagasta PLC | 3,122 | 44 | ||
ARM Holdings PLC | 354,995 | 870 | ||
AstraZeneca PLC | 17,536 | 753 | ||
Atkins WS PLC | 3,918 | 89 | ||
BAE Systems PLC | 73,509 | 720 | ||
Barclays PLC | 32,017 | 324 | ||
BBA Aviation PLC | 8,576 | 35 | ||
BG Group PLC | 35,085 | 808 | ||
| 46 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
BHP Billiton PLC | 49,892 | 1,537 | ||
Bovis Homes Group PLC | 1,154 | 14 | ||
BP PLC | 157,032 | 1,920 | ||
BP PLC - ADR (Ñ) | 23,720 | 1,736 | ||
Brit Insurance Holdings PLC | 26,788 | 121 | ||
British Airways PLC (Æ) | 11,418 | 70 | ||
British American Tobacco PLC | 9,838 | 387 | ||
British Energy Group PLC | 14,973 | 163 | ||
British Land Co. PLC (ö) | 3,265 | 61 | ||
BT Group PLC | 115,685 | 624 | ||
Burberry Group PLC | 119,110 | 1,341 | ||
Cable & Wireless PLC | 10,106 | 37 | ||
Cadbury Schweppes PLC | 122,682 | 1,529 | ||
Carphone Warehouse Group PLC | 315,575 | 2,153 | ||
Centrica PLC | 28,754 | 204 | ||
Charter PLC (Æ) | 1,607 | 25 | ||
Cobham PLC | 25,068 | 104 | ||
Compass Group PLC | 5,785 | 35 | ||
Daily Mail & General Trust PLC Class A | 1,037 | 10 | ||
Davis Service Group PLC | 15,107 | 153 | ||
Dawnay Day Treveria PLC | 586,180 | 693 | ||
De La Rue PLC | 1,365 | 26 | ||
Diageo PLC | 237,860 | 5,091 | ||
easyJet PLC (Æ) | 71,525 | 867 | ||
Friends Provident PLC | 9,621 | 31 | ||
Galiform PLC (Æ) | 4,993 | 9 | ||
GlaxoSmithKline PLC | 254,922 | 6,469 | ||
HBOS PLC | 27,396 | 397 | ||
Home Retail Group PLC | 87,756 | 564 | ||
HSBC Holdings PLC | 93,215 | 1,564 | ||
IG Group Holdings PLC | 10,051 | 81 | ||
Invensys PLC (Æ) | 5,611 | 25 | ||
J Sainsbury PLC | 51,870 | 437 | ||
Kesa Electricals PLC | 57,426 | 265 | ||
Kingfisher PLC | 222,493 | 641 | ||
Ladbrokes PLC | 150,385 | 960 | ||
Land Securities Group PLC (ö) | 3,833 | 114 | ||
Legal & General Group PLC | 100,982 | 261 | ||
Liberty International PLC (ö) | 471 | 10 | ||
Lloyds TSB Group PLC | 28,773 | 268 | ||
Man Group PLC | 233,925 | 2,691 | ||
National Express Group PLC | 4,128 | 101 | ||
National Grid PLC | 63,147 | 1,044 | ||
Next PLC | 4,290 | 138 | ||
Pearson PLC | 20,708 | 301 | ||
Petrofac, Ltd. | 10,160 | 110 | ||
Premier Farnell PLC | 3,208 | 9 | ||
Provident Financial PLC | 14,263 | 235 | ||
Reckitt Benckiser Group PLC | 97,747 | 5,647 |
| Principal Amount ($) or Shares | Market Value $ | |||
Reed Elsevier PLC | 5,030 | 68 | ||
Regus Group PLC | 95,727 | 156 | ||
Resolution PLC | 4,157 | 59 | ||
Reuters Group PLC | 8,904 | 112 | ||
Rio Tinto PLC | 7,416 | 777 | ||
Rolls-Royce Group PLC (Æ) | 9,742 | 105 | ||
Royal Bank of Scotland Group PLC | 224,330 | 2,017 | ||
Royal Dutch Shell PLC Class A | 82,086 | 3,458 | ||
Royal Dutch Shell PLC Class B | 27,539 | 1,152 | ||
Royal Dutch Shell PLC Class A | 274 | 12 | ||
SABMiller PLC | 4,856 | 137 | ||
Schroders PLC | 56,804 | 1,462 | ||
Scottish & Southern Energy PLC | 31,198 | 1,013 | ||
Shire PLC | 3,812 | 88 | ||
Smiths Group PLC | 86,838 | 1,741 | ||
Stagecoach Group PLC | 83,571 | 469 | ||
Standard Chartered PLC | 20,456 | 743 | ||
Tesco PLC | 529,817 | 5,003 | ||
Tomkins PLC | 22,652 | 80 | ||
Tullett Prebon PLC | 20,315 | 188 | ||
Unilever PLC | 32,541 | 1,220 | ||
Vodafone Group PLC | 337,503 | 1,258 | ||
Vodafone Group PLC - ADR | 71,630 | 2,673 | ||
Weir Group PLC (The) | 5,771 | 93 | ||
WH Smith PLC | 17,622 | 113 | ||
William Hill PLC | 193,817 | 2,010 | ||
WM Morrison Supermarkets PLC | 46,272 | 298 | ||
WPP Group PLC | 362,599 | 4,642 | ||
Xstrata PLC | 25,008 | 1,761 | ||
| 78,666 | ||||
United States - 0.4% | ||||
NYSE Euronext | 855 | 74 | ||
Synthes, Inc. | 14,256 | 1,762 | ||
| 1,836 | ||||
| Total Common Stocks | ||||
(cost $342,859) | 389,922 | |||
| Preferred Stocks - 0.6% | ||||
Germany - 0.5% | ||||
Henkel KGaA | 36,107 | 2,024 | ||
Volkswagen AG | 115 | 17 | ||
| 2,041 | ||||
Italy - 0.1% | ||||
Unipol Gruppo Finanziario SpA | 77,511 | 244 | ||
| Total Preferred Stocks | ||||
(cost $2,116) | 2,285 | |||
| Non-U.S. Fund | 47 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Notional Amount | Market Value $ | |||||
Options Purchased - 0.0% | ||||||
Switzerland - 0.0% | ||||||
Swiss Market Index Futures | ||||||
Mar 2008 8,398.00 Put (9) | CHF | 668 | 40 | |||
Mar 2008 8,532.77 Put (13) | CHF | 980 | 57 | |||
| Total Options Purchased | ||||||
(cost $95) | 97 | |||||
Principal | ||||||
Short-Term Investments - 8.2% | ||||||
United States - 8.2% | ||||||
Russell Investment Company Money Market Fund | 33,315,000 | 33,315 | ||||
United States Treasury Bills (§)(ž) 2.952% due 03/20/08 | 2,200 | 2,184 | ||||
| Total Short-Term Investments | ||||||
(cost $35,501) | 35,499 | |||||
| Other Securities - 9.1% | ||||||
State Street Securities Lending Quality Trust (×) | 39,195,360 | 39,195 | ||||
| Total Other Securities | ||||||
(cost $39,195) | 39,195 | |||||
| Total Investments - 108.2% | ||||||
(identified cost $419,766) | 466,998 | |||||
| Other Assets and Liabilities, Net - (8.2%) | (35,312 | ) | ||||
| Net Assets - 100.0% | 431,686 | |||||
A portion of the portfolio has been fair valued as of period end.
See accompanying notes which are an integral part of the financial statements.
| 48 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands
| Futures Contracts (Number of Contracts) | Notional Amount | Unrealized Appreciation (Depreciation) $ | ||||
Long Positions | ||||||
AEX Index (Netherlands) expiration date 01/08 (11) | EUR | 1,137 | 24 | |||
CAC-40 Index (France) expiration date 01/08 (57) | EUR | 3,204 | 45 | |||
DAX Index (Germany) expiration date 03/08 (23) | EUR | 4,683 | 216 | |||
EUR STOXX 50 Index | EUR | 4,258 | 131 | |||
FTSE-100 Index (UK) | GBP | 7,681 | 270 | |||
Hang Seng Index (Hong Kong) expiration date 01/08 (21) | HKD | 29,306 | 10 | |||
MSCI Singapore Index | SGD | 85 | 1 | |||
TOPIX Index (Japan) | JPY | 1,940,400 | (971 | ) | ||
Short Positions | ||||||
IBEX Plus Index (Spain) | EUR | 2,871 | 44 | |||
MIB-30 (Italy) | EUR | 1,751 | (19 | ) | ||
OMX Stockholm 30 Index (Sweden) expiration date 01/08 (100) | SEK | 10,838 | (15 | ) | ||
SPI 200 Index (Australia) expiration date 03/08 (44) | AUD | 6,983 | (111 | ) | ||
Total Unrealized Appreciation (Depreciation) on Open Futures Contracts | (375 | ) | ||||
| Options Written (Number of Contracts) | Notional Amount | Market | ||||
| �� | ||||||
| Switzerland | ||||||
| Swiss Market Index Futures | ||||||
| Mar 2008 8,398.00 Call (9) | CHF | 668 | (40 | ) | ||
| Mar 2008 8,532.77 Call (13) | CHF | 980 | (57 | ) | ||
| Total Liability for Options Written (premiums received $95) | (97 | ) | ||||
See accompanying notes which are an integral part of the financial statements.
| Non-U.S. Fund | 49 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands
| Index Swap Contracts | |||||||||||||
Fund Receives | Counter | Notional Amount | Fund Pays | Termination Date | Unrealized Appreciation (Depreciation) $ | ||||||||
MSCI Denmark | Merrill Lynch | DKK | 3,994 | 1 Month EUR LIBOR | 03/19/08 | (14 | ) | ||||||
MSCI Denmark | Merrill Lynch | DKK | 708 | 1 Month EUR LIBOR | 03/19/08 | (2 | ) | ||||||
MSCI Belgium | Merrill Lynch | EUR | 325 | 1 Month EUR LIBOR | 03/19/08 | 11 | |||||||
Total Unrealized Appreciation (Depreciation) on Open Index Swap Contracts | (5 | ) | |||||||||||
| Industry Diversification (Unaudited) | % of Net Assets | Market Value | ||||
Auto and Transportation | 5.0 | 21,408 | ||||
Consumer Discretionary | 10.5 | 45,552 | ||||
Consumer Staples | 12.5 | 52,711 | ||||
Financial Services | 17.7 | 74,227 | ||||
Health Care | 6.8 | 29,616 | ||||
Information Technology | 0.2 | 791 | ||||
Integrated Oils | 5.1 | 21,533 | ||||
Materials and Processing | 8.7 | 38,040 | ||||
Miscellaneous | 1.2 | 4,922 | ||||
Other Energy | 1.3 | 5,858 | ||||
Producer Durables | 9.8 | 44,451 | ||||
Technology | 3.3 | 13,952 | ||||
Utilities | 8.8 | 39,146 | ||||
Options Purchased | — | 97 | ||||
Short-Term Investments | 8.2 | 35,499 | ||||
Other Securities | 9.1 | 39,195 | ||||
Total Investments | 108.2 | 466,998 | ||||
Other Assets and Liabilities, Net | (8.2 | ) | (35,312 | ) | ||
Net Assets | 100.0 | 431,686 | ||||
| Geographic Diversification (Unaudited) | % of Net Assets | Market Value $ | ||||
Africa | 0.1 | 416 | ||||
Asia | 5.1 | 22,067 | ||||
Europe | 47.4 | 204,530 | ||||
Japan | 15.8 | 68,155 | ||||
Latin America | 2.5 | 10,434 | ||||
Middle East | 0.4 | 1,590 | ||||
Other Regions | 9.6 | 41,945 | ||||
United Kingdom | 18.2 | 78,666 | ||||
Other Securities | 9.1 | 39,195 | ||||
Total Investments | 108.2 | 466,998 | ||||
Other Assets and Liabilities, Net | (8.2 | ) | (35,312 | ) | ||
Net Assets | 100.0 | 431,686 | ||||
See accompanying notes which are an integral part of the financial statements.
| 50 | Non-U.S. Fund |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands
| Foreign Currency Exchange Contracts | |||||||||||
| Amount Sold | Amount Bought | Settlement Date | Unrealized Appreciation (Depreciation) $ | ||||||||
| USD | 25 | CHF | 29 | 01/03/08 | — | ||||||
| USD | 50 | CHF | 57 | 03/19/08 | 1 | ||||||
| USD | 111 | EUR | 77 | 01/02/08 | 2 | ||||||
| USD | 43 | EUR | 29 | 01/03/08 | — | ||||||
| USD | 288 | EUR | 200 | 03/19/08 | 5 | ||||||
| USD | 292 | EUR | 200 | 03/19/08 | 1 | ||||||
| USD | 295 | EUR | 200 | 03/19/08 | (2 | ) | |||||
| USD | 430 | EUR | 300 | 03/19/08 | 9 | ||||||
| USD | 732 | EUR | 500 | 03/19/08 | (1 | ) | |||||
| USD | 1,320 | EUR | 900 | 03/19/08 | (3 | ) | |||||
| USD | 1,903 | EUR | 1,300 | 03/19/08 | (1 | ) | |||||
| USD | 2,261 | EUR | 1,570 | 03/19/08 | 37 | ||||||
| USD | 2,345 | EUR | 1,627 | 03/19/08 | 36 | ||||||
| USD | 3,515 | EUR | 2,440 | 03/19/08 | 55 | ||||||
| USD | 5,857 | EUR | 4,067 | 03/19/08 | 94 | ||||||
| USD | 12,897 | EUR | 8,800 | 03/19/08 | (21 | ) | |||||
| USD | 13,600 | EUR | 9,300 | 03/19/08 | 7 | ||||||
| USD | 30 | GBP | 15 | 01/02/08 | — | ||||||
| USD | 26 | GBP | 13 | 01/03/08 | — | ||||||
| USD | 56 | GBP | 28 | 01/03/08 | — | ||||||
| USD | 199 | GBP | 100 | 03/19/08 | — | ||||||
| USD | 399 | GBP | 200 | 03/19/08 | (1 | ) | |||||
| USD | 504 | GBP | 250 | 03/19/08 | (8 | ) | |||||
| USD | 607 | GBP | 300 | 03/19/08 | (11 | ) | |||||
| USD | 1,313 | GBP | 650 | 03/19/08 | (22 | ) | |||||
| USD | 8,071 | GBP | 4,000 | 03/19/08 | (125 | ) | |||||
| USD | 9,091 | GBP | 4,500 | 03/19/08 | (153 | ) | |||||
| USD | 101 | HKD | 789 | 03/19/08 | — | ||||||
| USD | 234 | HKD | 1,822 | 03/19/08 | — | ||||||
| USD | 65 | JPY | 7,318 | 01/07/08 | 1 | ||||||
| USD | 77 | JPY | 8,624 | 01/08/08 | — | ||||||
| USD | 446 | JPY | 50,000 | 03/19/08 | 5 | ||||||
| USD | 545 | JPY | 60,000 | 03/19/08 | (4 | ) | |||||
| USD | 909 | JPY | 100,000 | 03/19/08 | (6 | ) | |||||
| USD | 909 | JPY | 100,000 | 03/19/08 | (7 | ) | |||||
| USD | 1,898 | JPY | 212,137 | 03/19/08 | 17 | ||||||
| USD | 2,182 | JPY | 240,000 | 03/19/08 | (15 | ) | |||||
| USD | 2,958 | JPY | 325,000 | 03/19/08 | (24 | ) | |||||
| USD | 3,912 | JPY | 430,000 | 03/19/08 | (30 | ) | |||||
| USD | 4,071 | JPY | 455,817 | 03/19/08 | 44 | ||||||
| USD | 4,869 | JPY | 535,000 | 03/19/08 | (39 | ) | |||||
| USD | 2 | MXN | 21 | 01/02/08 | — | ||||||
| USD | 2 | MXN | 21 | 01/03/08 | — | ||||||
| USD | 16,047 | NOK | 89,379 | 03/19/08 | 377 | ||||||
| USD | 87 | SEK | 571 | 03/19/08 | 1 | ||||||
| USD | 520 | SGD | 756 | 03/19/08 | 8 | ||||||
| AUD | 324 | USD | 276 | 03/19/08 | (7 | ) | |||||
| AUD | 324 | USD | 276 | 03/19/08 | (7 | ) | |||||
| AUD | 701 | USD | 598 | 03/19/08 | (14 | ) | |||||
| Foreign Currency Exchange Contracts | |||||||||||
| Amount Sold | Amount Bought | Settlement Date | Unrealized Appreciation (Depreciation) $ | ||||||||
| CHF | 6,601 | USD | 5,758 | 03/19/08 | (99 | ) | |||||
| DKK | 11 | USD | 2 | 03/19/08 | — | ||||||
| DKK | 890 | USD | 172 | 03/19/08 | (3 | ) | |||||
| EUR | 19 | USD | 28 | 01/02/08 | — | ||||||
| EUR | 39 | USD | 57 | 01/02/08 | — | ||||||
| EUR | 42 | USD | 61 | 01/02/08 | — | ||||||
| EUR | 39 | USD | 57 | 01/03/08 | — | ||||||
| EUR | 39 | USD | 57 | 01/03/08 | — | ||||||
| EUR | 100 | USD | 147 | 03/19/08 | 1 | ||||||
| EUR | 100 | USD | 148 | 03/19/08 | 2 | ||||||
| EUR | 200 | USD | 292 | 03/19/08 | — | ||||||
| EUR | 400 | USD | 586 | 03/19/08 | 1 | ||||||
| EUR | 500 | USD | 733 | 03/19/08 | 1 | ||||||
| EUR | 500 | USD | 733 | 03/19/08 | 1 | ||||||
| EUR | 600 | USD | 880 | 03/19/08 | 2 | ||||||
| EUR | 800 | USD | 1,178 | 03/19/08 | 7 | ||||||
| EUR | 1,200 | USD | 1,759 | 03/19/08 | 3 | ||||||
| EUR | 6,148 | USD | 8,844 | 03/19/08 | (151 | ) | |||||
| EUR | 8,100 | USD | 11,858 | 03/19/08 | 7 | ||||||
| GBP | 95 | USD | 189 | 01/02/08 | — | ||||||
| GBP | 61 | USD | 122 | 01/03/08 | 1 | ||||||
| GBP | 100 | USD | 202 | 03/19/08 | 3 | ||||||
| GBP | 100 | USD | 202 | 03/19/08 | 4 | ||||||
| GBP | 100 | USD | 204 | 03/19/08 | 5 | ||||||
| GBP | 200 | USD | 408 | 03/19/08 | 11 | ||||||
| GBP | 237 | USD | 477 | 03/19/08 | 7 | ||||||
| GBP | 250 | USD | 505 | 03/19/08 | 9 | ||||||
| GBP | 300 | USD | 606 | 03/19/08 | 11 | ||||||
| GBP | 570 | USD | 1,148 | 03/19/08 | 16 | ||||||
| GBP | 700 | USD | 1,415 | 03/19/08 | 25 | ||||||
| GBP | 1,140 | USD | 2,295 | 03/19/08 | 31 | ||||||
| GBP | 2,105 | USD | 4,254 | 03/19/08 | 73 | ||||||
| GBP | 3,000 | USD | 6,060 | 03/19/08 | 101 | ||||||
| GBP | 5,675 | USD | 11,414 | 03/19/08 | 142 | ||||||
| JPY | 5,000 | USD | 46 | 03/19/08 | — | ||||||
| JPY | 50,000 | USD | 450 | 03/19/08 | (2 | ) | |||||
| JPY | 50,000 | USD | 461 | 03/19/08 | 9 | ||||||
| JPY | 100,000 | USD | 905 | 03/19/08 | 2 | ||||||
| JPY | 150,000 | USD | 1,366 | 03/19/08 | 12 | ||||||
| JPY | 595,000 | USD | 5,411 | 03/19/08 | 39 | ||||||
| NOK | 3,259 | USD | 584 | 03/19/08 | (15 | ) | |||||
| NOK | 3,259 | USD | 585 | 03/19/08 | (14 | ) | |||||
| NOK | 18,725 | USD | 3,352 | 03/19/08 | (89 | ) | |||||
| SEK | 18,888 | USD | 2,878 | 03/19/08 | (46 | ) | |||||
| SGD | 22 | USD | 15 | 03/19/08 | — | ||||||
| ZAR | 751 | USD | 107 | 01/02/08 | (3 | ) | |||||
| 303 | |||||||||||
See accompanying notes which are an integral part of the financial statements.
| Non-U.S. Fund | 51 |
Table of Contents
Russell Investment Funds
Non-U.S. Fund
Presentation of Portfolio Holdings — December 31, 2007
| Categories | % of Net Assets | ||
Australia | 2.1 | ||
Austria | 0.5 | ||
Belgium | 0.4 | ||
Bermuda | 1.2 | ||
Brazil | 0.5 | ||
Canada | 1.0 | ||
Cayman Islands | 0.7 | ||
China | 0.1 | ||
Czech Republic | 0.2 | ||
Denmark | 1.0 | ||
Egypt | 0.4 | ||
Finland | 1.6 | ||
France | 12.9 | ||
Germany | 8.3 | ||
Greece | 0.2 | ||
Hong Kong | 0.8 | ||
India | 0.2 | ||
Indonesia | 0.1 | ||
Ireland | 0.5 | ||
Italy | 3.5 | ||
Japan | 15.8 | ||
Luxembourg | 0.7 | ||
Mexico | 0.1 | ||
Netherlands | 4.2 | ||
Netherlands Antilles | — | * | |
Norway | 0.2 | ||
Papua New Guinea | — | * | |
Portugal | 0.2 | ||
Russia | 0.4 | ||
Singapore | 0.7 | ||
South Africa | 0.1 | ||
South Korea | 0.8 | ||
Spain | 2.2 | ||
Sweden | 1.3 | ||
Switzerland | 8.3 | ||
Taiwan | 0.2 | ||
Thailand | 0.1 | ||
Turkey | 0.2 | ||
United Kingdom | 18.2 | ||
United States | 0.4 | ||
Preferred Stocks | 0.6 | ||
Options Purchased | — | * | |
Short-Term Investments | 8.2 | ||
Other Securities | 9.1 | ||
Total Investments | 108.2 | ||
Other Assets and Liabilities Net | (8.2 | ) | |
| 100.0 | |||
| Categories | % of Net Assets | ||
Futures Contracts | (— | *) | |
Options Written | (— | *) | |
Foreign Currency Exchange Contracts | — | * | |
Index Swap Contracts | (— | *) |
| * | Less than .05% of net assets. |
See accompanying notes which are an integral part of the financial statements.
| 52 | Non-U.S. Fund |
Table of Contents
(This page intentionally left blank)
Table of Contents
Russell Investment Funds
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
| Real Estate Securities Fund | |||
| Total Return | |||
1 Year | (15.86 | )% | |
5 Years | 19.03 | %§ | |
Inception* | 14.17 | %§ | |
| FTSE NAREIT Equity REIT Index ** | |||
| Total Return | |||
1 Year | (15.69 | )% | |
5 Years | 18.17 | %§ | |
Inception* | 14.16 | %§ | |
| * | The Fund commenced operations on April 30, 1999. |
| ** | FTSE National Association of Real Estate Investment Trusts (NAREIT) Equity REIT Index is an index composed of all the data based on the last closing price of the month for all tax-qualified REITs listed on the New York Stock Exchange, American Stock Exchange, and the NASDAQ National Market System. The data is market value-weighted. The total-return calculation is based upon whether it is 1-month, 3-months or 12-months. Only those REITs listed for the entire period are used in the total return calculation. |
| § | Annualized. |
Performance is historical and assumes reinvestment of all dividends and capital gains. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than when purchased. Past performance is not indicative of future results.
| 54 | Real Estate Securities Fund |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
The Real Estate Securities Fund (the “Fund”) allocates most of its assets among multiple money managers. Russell Investment Management Company (“RIMCo”), as the Fund’s advisor, may change the allocation of the Fund’s assets among money managers at any time. An exemptive order from the Securities and Exchange Commission (SEC) permits RIMCo to engage or terminate a money manager at any time, subject to the approval by the Fund’s Board without a shareholder vote. Pursuant to the terms of the exemptive order, the Fund is required to notify its shareholders within 60 days of when a money manager begins providing services. The Fund currently has five money managers.
What is the Fund’s investment objective?
The Fund seeks to provide current income and long term capital growth.
How did the Fund perform relative to its benchmark for the fiscal year ended December 31, 2007?
For the fiscal year ended December 31, 2007, the Real Estate Securities Fund returned (15.86)%. This compared to the FTSE NAREIT Equity REIT Index, which returned (15.69)% during the same period. The Fund’s performance includes operating expenses, whereas Index returns are unmanaged and do not include expenses of any kind.
For the year ended December 31, 2007, the Lipper® Real Estate Funds (VIP) Average returned (14.87)%. This result serves as a peer comparison and is expressed net of operating expenses.
How did the market conditions described in the Market Summary report affect the Fund’s performance?
The money managers positioned the Fund to benefit from property sectors with the strongest supply and demand fundamentals. The largest overweight positions were in the regional malls and office sectors. The market favored the more defensive sectors, including industrial, health care and specialty. As discussed below, sector positioning was a negative contributor to the Fund’s performance during the fiscal year.
The Fund maintained a primary focus on the larger and more liquid REITs during the fiscal year. With the exceptional volatility experienced during the fiscal year, this positioning generally benefited the Fund during periods when the REIT market was rising, but detracted during periods when the market was declining. Non-dedicated REIT investors typically trade the more liquid securities when they rotate into or out of the sector.
Mergers and acquisitions activity was a positive contributor to the Fund’s performance. The Fund maintained overweight positions in two companies that were acquisition targets: Hilton Hotels Corporation and Archstone-Smith Trust. Both companies were acquired by private market investors at significant premiums to their share prices.
How did the investment strategies and techniques employed by the Fund and its money managers affect its performance?
AEW Management and Advisors, L.P. pursues a value-oriented style that focuses on identifying companies that it believes are mispriced relative to underlying real estate net asset value. AEW underperformed the benchmark during the fiscal year due primarily to adverse sector selection. The primary detractors were underweight positions in the outperforming health care and specialty sectors. Stock selection had a neutral impact on performance.
INVESCO Institutional (N.A.) maintains a broadly diversified portfolio with exposure to all major property sectors. Its investment style incorporates fundamental property market research and bottom-up quantitative securities analysis. INVESCO outperformed the benchmark during the fiscal year due to contributions from stock selection and, to a lesser extent, sector selection. Stock selection was strongest in the industrial and health care sectors. Positive sector selection was driven by an overweight in the health care sector and an underweight in the mixed industrial/office sector. An underweight in the outperforming specialty sector partially offset these positive effects.
RREEF America L.L.C.’s style emphasizes a top-down approach to property sector weights based on an assessment of property market fundamentals. RREEF outperformed the benchmark during the fiscal year due to contributions from stock selection. Stock selection was strongest in the shopping centers, apartments, health care and industrial sectors. Sector selection had a negative impact on overall performance, driven by underweight positions in the outperforming specialty and health care sectors.
Heitman Real Estate Securities LLC manages a concentrated portfolio with a bottom-up approach to stock selection focusing on companies that it believes have attractive valuations relative to growth prospects. Heitman outperformed the benchmark during the fiscal year, primarily as a result of effective stock selection. Stock selection was strongest in the regional malls, shopping centers, health care and apartments sectors. Sector selection detracted from performance, due primarily to an underweight in the outperforming specialty sector.
Cohen & Steers Capital Management Inc. was added to the Fund in May 2007 and manages a broadly diversified portfolio of global property securities. Cohen & Steers uses a bottom-up approach to portfolio construction, emphasizing the relationship between price and net asset value as the principal valuation metric. From its hire through the end of the fiscal year, its global portfolio had a positive impact on Fund performance. Investments in the Asia Pacific region, particularly in Hong Kong, had a positive
| Real Estate Securities Fund | 55 |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
contribution, but this was partially offset by investments in the underperforming United Kingdom market.
Describe any changes to the Fund’s structure or the money manager line-up.
Cohen & Steers was added to the manager line-up in May 2007 at a 10% target weight to implement a global strategy for the Fund. The global strategy is intended to provide diversification benefits and the potential to participate in the evolving non-U.S. REIT market. The non-U.S. REIT market continues to grow as more countries adopt REIT structures.
| Money Managers as of December 31, 2007 | Styles | |
AEW Management and Advisors, L.P. | Value | |
Cohen & Steers Capital Management, Inc. | Global Market-Oriented | |
Heitman Real Estate Securities LLC | Growth | |
INVESCO Institutional (N.A.), Inc. which acts | Market-Oriented | |
RREEF America L.L.C. | Market-Oriented | |
The views expressed in this report reflect those of the portfolio managers only through the end of the period covered by the report. These views do not necessarily represent the views of Russell Investment Management Company (RIMCo), or any other person in RIMCo or any other affiliated organization. These views are subject to change at any time based upon market conditions or other events, and RIMCo disclaims any responsibility to update the views contained herein. These views should not be relied on as investment advice and, because investment decisions for Russell Investment Funds (RIF) are based on numerous factors, should not be relied on as an indication of investment decisions of any RIF Fund.
| 56 | Real Estate Securities Fund |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Shareholder Expense Example — December 31, 2007 (Unaudited)
Fund Expenses
The following disclosure provides important information regarding each Fund’s Expense Example, which appears on each Fund’s individual page in this Annual Report. Please refer to this information when reviewing the Expense Example for a Fund.
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for this Fund is from July 1, 2007 to December 31, 2007.
Actual Expenses
The information in the table under the heading “Actual Performance” provides information about actual account values and actual expenses. You may use the information in this column, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first column in the row entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical Performance (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the information under the heading “Hypothetical Performance (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Actual Performance | Hypothetical Performance (5% return before expenses) | |||||
Beginning Account Value | ||||||
July 1, 2007 | $ | 1,000.00 | $ | 1,000.00 | ||
Ending Account Value | ||||||
December 31, 2007 | $ | 900.10 | $ | 1,020.42 | ||
Expenses Paid During Period* | $ | 4.55 | $ | 4.84 | ||
| * | Expenses are equal to the Fund’s annualized expense ratio of 0.95% (representing the six month period annualized), multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). |
| Real Estate Securities Fund | 57 |
Table of Contents
Russell Investment Funds
Schedule of Investments — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Common Stocks - 96.4% | ||||
Apartments - 13.5% | ||||
Apartment Investment & Management Co. Class A (ö)(Ñ) | 156,403 | 5,432 | ||
AvalonBay Communities, Inc. (ö) | 189,941 | 17,881 | ||
BRE Properties, Inc. Class A (ö)(Ñ) | 156,472 | 6,342 | ||
Camden Property Trust (ö)(Ñ) | 158,900 | 7,651 | ||
Colonial Properties Trust (ö) | 29,500 | 668 | ||
Deutsche Wohnen AG | 3,915 | 120 | ||
Equity Residential (ö)(Ñ) | 463,018 | 16,886 | ||
Essex Property Trust, Inc. (ö)(Ñ) | 64,137 | 6,253 | ||
Home Properties, Inc. (ö)(Ñ) | 11,000 | 493 | ||
Mid-America Apartment Communities, Inc. (ö) | 34,700 | 1,483 | ||
UDR, Inc. (ö)(Ñ) | 128,203 | 2,545 | ||
| 65,754 | ||||
Diversified - 10.4% | ||||
British Land Co. PLC (ö) | 56,095 | 1,046 | ||
CA Immobilien Anlagen AG (Æ) | 10,010 | 222 | ||
CapitaLand, Ltd. | 29,000 | 125 | ||
Castellum AB | 42,000 | 431 | ||
Cheung Kong Holdings, Ltd. | 21,429 | 390 | ||
DB RREEF Trust (ö) | 144,028 | 252 | ||
Eurocastle Investment, Ltd. | 2,309 | 56 | ||
Forest City Enterprises, Inc. Class A | 8,459 | 376 | ||
GPT Group (ö) | 208,378 | 736 | ||
Great Eagle Holdings, Ltd. | 203,361 | 751 | ||
Heiwa Real Estate Co., Ltd. | 43,000 | 272 | ||
Helical Bar PLC | 34,700 | 224 | ||
Henderson Land Development Co., Ltd. | 158,822 | 1,472 | ||
Hysan Development Co., Ltd. | 194,264 | 550 | ||
ICADE (ö) | 1,372 | 205 | ||
iStar Financial, Inc. (ö)(Ñ) | 56,000 | 1,459 | ||
IVG Immobilien AG | 4,609 | 156 | ||
Kenedix Realty Investment Corp. Class A (ö) | 25 | 165 | ||
Kerry Properties, Ltd. | 15,000 | 120 | ||
Land Securities Group PLC (ö) | 79,627 | 2,368 | ||
Mirvac Group (ö) | 65,396 | 344 | ||
Mitsubishi Estate Co., Ltd. | 100,000 | 2,397 | ||
Mitsui Fudosan Co., Ltd. | 93,000 | 2,010 | ||
New World China Land, Ltd. | 432,435 | 386 | ||
Sino Land Co. | 133,912 | 470 | ||
Sino-Ocean Land Holdings, Ltd. (Æ) | 944 | 1 | ||
Sponda OYJ | 19,281 | 229 | ||
Stockland (ö) | 52,925 | 390 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Sumitomo Realty & Development Co., Ltd. | 9,000 | 221 | ||
Sun Hung Kai Properties, Ltd. | 66,409 | 1,397 | ||
Unibail-Rodamco (ö) | 10,617 | 2,311 | ||
Vornado Realty Trust (ö)(Ñ) | 294,397 | 25,892 | ||
Washington Real Estate Investment Trust (ö)(Ñ) | 83,000 | 2,607 | ||
Wharf Holdings, Ltd. | 120,577 | 622 | ||
| 50,653 | ||||
Free Standing Retail - 0.1% | ||||
Realty Income Corp. (ö)(Ñ) | 24,400 | 659 | ||
Health Care - 8.0% | ||||
HCP, Inc. (ö)(Ñ) | 253,550 | 8,818 | ||
Health Care REIT, Inc. (ö)(Ñ) | 79,800 | 3,566 | ||
Healthcare Realty Trust, Inc. (ö)(Ñ) | 36,300 | 922 | ||
LTC Properties, Inc. (ö) | 40,000 | 1,002 | ||
Nationwide Health Properties, Inc. (ö) | 301,050 | 9,444 | ||
Omega Healthcare Investors, Inc. (ö) | 106,500 | 1,709 | ||
Senior Housing Properties Trust (ö)(Ñ) | 86,000 | 1,951 | ||
Ventas, Inc. (ö) | 257,300 | 11,643 | ||
| 39,055 | ||||
Industrial - 7.4% | ||||
AMB Property Corp. (ö)(Ñ) | 126,200 | 7,264 | ||
DCT Industrial Trust, Inc. (ö)(Ñ) | 275,800 | 2,568 | ||
First Potomac Realty Trust (ö)(Ñ) | 62,800 | 1,086 | ||
Goodman Group (ö) | 115,824 | 499 | ||
Prologis (ö) | 379,969 | 24,082 | ||
Segro PLC (ö) | 82,813 | 769 | ||
| 36,268 | ||||
Lodging/Resorts - 6.7% | ||||
Ashford Hospitality Trust, Inc. (ö)(Ñ) | 125,800 | 905 | ||
DiamondRock Hospitality Co. (ö)(Ñ) | 48,300 | 724 | ||
FelCor Lodging Trust, Inc. (ö) | 77,950 | 1,215 | ||
Hospitality Properties Trust (ö) | 16,000 | 516 | ||
Host Hotels & Resorts, Inc. (ö) | 1,132,591 | 19,299 | ||
LaSalle Hotel Properties (ö)(Ñ) | 83,213 | 2,654 | ||
Shangri-La Asia, Ltd. | 151,211 | 470 | ||
Starwood Hotels & Resorts Worldwide, Inc. | 155,609 | 6,851 | ||
Sunstone Hotel Investors, Inc. (ö) | 10,951 | 200 | ||
| 32,834 | ||||
Manufactured Homes - 0.4% | ||||
Equity Lifestyle Properties, Inc. (ö) | 46,250 | 2,112 | ||
| 58 | Real Estate Securities Fund |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Mixed Industrial/Office - 1.0% | ||||
Liberty Property Trust (ö)(Ñ) | 126,091 | 3,633 | ||
PS Business Parks, Inc. (ö) | 23,400 | 1,229 | ||
| 4,862 | ||||
Office - 15.3% | ||||
Alexandria Real Estate Equities, Inc. (ö)(Ñ) | 43,500 | 4,423 | ||
Alstria Office REIT-AG (Æ)(ö) | 12,291 | 184 | ||
Beni Stabili SpA | 355,394 | 385 | ||
BioMed Realty Trust, Inc. (ö) | 200,561 | 4,647 | ||
Boston Properties, Inc. (ö) | 224,473 | 20,609 | ||
Brandywine Realty Trust (ö)(Ñ) | 206,881 | 3,709 | ||
Brookfield Properties Corp. (Ñ) | 183,588 | 3,534 | ||
CapitaCommercial Trust (Æ)(ö) | 147,000 | 250 | ||
Commonwealth Property Office Fund (ö) | 488,644 | 664 | ||
Corporate Office Properties Trust SBI MD (ö)(Ñ) | 58,600 | 1,846 | ||
DA Office Investment Corp. Class A (ö) | 15 | 96 | ||
Derwent London PLC (ö) | 53,227 | 1,485 | ||
Douglas Emmett, Inc. (ö) | 291,690 | 6,595 | ||
Great Portland Estates PLC (ö) | 94,633 | 897 | ||
Highwoods Properties, Inc. (ö)(Ñ) | 35,400 | 1,040 | ||
Hongkong Land Holdings, Ltd. | 274,000 | 1,345 | ||
HRPT Properties Trust (ö)(Ñ) | 173,000 | 1,337 | ||
Kilroy Realty Corp. (ö)(Ñ) | 70,862 | 3,895 | ||
Mack-Cali Realty Corp. (ö)(Ñ) | 69,051 | 2,348 | ||
Maguire Properties, Inc. (ö) | 13,678 | 403 | ||
Nomura Real Estate Office Fund, Inc. Class A (ö) | 22 | 207 | ||
Norwegian Property ASA | 16,291 | 198 | ||
Parkway Properties, Inc. (ö)(Ñ) | 10,600 | 392 | ||
SL Green Realty Corp. (ö)(Ñ) | 149,120 | 13,937 | ||
Societe Immobiliere de Location pour l’Industrie et le Commerce (ö) | 1,741 | 254 | ||
Tishman Speyer Office Fund (ö) | 137,300 | 195 | ||
Tokyo Tatemono Co., Ltd. | 2,000 | 19 | ||
| 74,894 | ||||
Regional Malls - 16.0% | ||||
Aeon Mall Co., Ltd. | 22,600 | 593 | ||
CBL & Associates Properties, Inc. (ö)(Ñ) | 72,300 | 1,729 | ||
CFS Retail Property Trust (ö) | 202,360 | 415 | ||
General Growth Properties, Inc. (ö) | 376,220 | 15,493 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Macerich Co. (The) (ö)(Ñ) | 188,102 | 13,366 | ||
Simon Property Group, Inc. (ö) | 447,627 | 38,881 | ||
Taubman Centers, Inc. (ö)(Ñ) | 145,900 | 7,177 | ||
Westfield Group (ö) | 34,463 | 631 | ||
| 78,285 | ||||
Self Storage - 4.4% | ||||
Extra Space Storage, Inc. (ö)(Ñ) | 95,800 | 1,369 | ||
Public Storage (ö)(Ñ) | 273,851 | 20,103 | ||
| 21,472 | ||||
Shopping Centers - 11.0% | ||||
Cedar Shopping Centers, Inc. (ö) | 62,000 | 634 | ||
Citycon Oyj | 46,277 | 246 | ||
Corio NV (ö) | 3,418 | 275 | ||
Developers Diversified Realty Corp. (ö) | 258,163 | 9,885 | ||
Federal Realty Invs Trust (ö)(Ñ) | 206,458 | 16,960 | ||
Hammerson PLC (ö) | 44,579 | 907 | ||
Kimco Realty Corp. (ö)(Ñ) | 187,900 | 6,840 | ||
Kite Realty Group Trust (ö)(Ñ) | 102,400 | 1,564 | ||
Mercialys SA (ö) | 3,681 | 140 | ||
Regency Centers Corp. (ö) | 191,467 | 12,348 | ||
Saul Centers, Inc. (ö) | 17,600 | 940 | ||
Tanger Factory Outlet Centers (ö)(Ñ) | 78,750 | 2,970 | ||
| 53,709 | ||||
Specialty - 2.2% | ||||
Digital Realty Trust, Inc. (ö)(Ñ) | 167,700 | 6,435 | ||
DuPont Fabros Technology, Inc. (ö)(Ñ) | 53,600 | 1,050 | ||
Entertainment Properties Trust (ö)(Ñ) | 18,000 | 846 | ||
Plum Creek Timber Co., Inc. (ö)(Ñ) | 49,500 | 2,279 | ||
| 10,610 | ||||
| Total Common Stocks | ||||
(cost $402,796) | 471,167 | |||
| Warrants & Rights - 0.0% | ||||
Wharf Holdings, Ltd. (Æ) | 15,071 | 21 | ||
| Total Warrants & Rights | ||||
(cost $—) | 21 | |||
| Short-Term Investments - 3.1% | ||||
Russell Investment Company Money Market Fund | 15,210,000 | 15,210 | ||
| Total Short-Term Investments | ||||
(cost $15,210) | 15,210 | |||
| Real Estate Securities Fund | 59 |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | ||||
| Other Securities - 19.8% | |||||
State Street Securities Lending Quality Trust (×) | 96,537,248 | 96,537 | |||
| Total Other Securities | |||||
(cost $96,537) | 96,537 | ||||
| Total Investments - 119.3% | |||||
(identified cost $514,543) | 582,935 | ||||
| Other Assets and Liabilities, Net - (19.3%) | (94,126 | ) | |||
| Net Assets - 100.0% | 488,809 | ||||
See accompanying notes which are an integral part of the financial statements.
| 60 | Real Estate Securities Fund |
Table of Contents
Russell Investment Funds
Real Estate Securities Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands
| Foreign Currency Exchange Contracts | ||||||||||
| Amount Sold | Amount Bought | Settlement Date | Unrealized Appreciation (Depreciation) $ | |||||||
| USD | 3 | AUD | 4 | 01/02/08 | — | |||||
| USD | 11 | AUD | 12 | 01/02/08 | — | |||||
| USD | 13 | AUD | 15 | 01/02/08 | — | |||||
| USD | 26 | AUD | 30 | 01/02/08 | — | |||||
| USD | 4 | AUD | 5 | 01/03/08 | — | |||||
| USD | 11 | AUD | 12 | 01/03/08 | — | |||||
| USD | 15 | AUD | 17 | 01/03/08 | — | |||||
| USD | 66 | AUD | 76 | 01/03/08 | — | |||||
| USD | 63 | HKD | 492 | 01/02/08 | — | |||||
| USD | 73 | HKD | 571 | 01/02/08 | — | |||||
| USD | 58 | HKD | 452 | 01/08/08 | — | |||||
| USD | 102 | SGD | 148 | 01/02/08 | — | |||||
| EUR | 6 | USD | 8 | 01/03/08 | — | |||||
| EUR | 9 | USD | 13 | 01/03/08 | — | |||||
| EUR | 12 | USD | 17 | 01/03/08 | — | |||||
| SGD | 39 | USD | 27 | 01/02/08 | — | |||||
| SGD | 14 | USD | 10 | 01/03/08 | — | |||||
| Total Unrealized Appreciation (Depreciation) on Open Foreign Currency Exchange Contracts | — | |||||||||
Presentation of Portfolio Holdings — December 31, 2007
| Categories | % of Net Assets | ||
Apartments | 13.5 | ||
Diversified | 10.4 | ||
Free Standing Retail | 0.1 | ||
Health Care | 8.0 | ||
Industrial | 7.4 | ||
Lodging/Resorts | 6.7 | ||
Manufactured Homes | 0.4 | ||
Mixed Industrial/Office | 1.0 | ||
Office | 15.3 | ||
Regional Malls | 16.0 | ||
Self Storage | 4.4 | ||
Shopping Centers | 11.0 | ||
Specialty | 2.2 | ||
Warrants & Rights | — | * | |
Short-Term Investments | 3.1 | ||
Other Securities | 19.8 | ||
Total Investments | 119.3 | ||
Other Assets and Liabilities, Net | (19.3 | ) | |
| 100.0 | |||
Foreign Currency Exchange Contracts | — | * | |
| * | Less than .05% of net assets. |
See accompanying notes which are an integral part of the financial statements.
| Real Estate Securities Fund | 61 |
Table of Contents
Russell Investment Funds
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
| Core Bond Fund | |||
| Total Return | |||
1 Year | 7.24 | % | |
5 Years | 4.74 | %§ | |
10 Years | 5.63 | %§ | |
| Lehman Brothers Aggregate Bond Index ** | |||
| Total Return | |||
1 Year | 6.97 | % | |
5 Years | 4.42 | %§ | |
10 Years | 5.97 | %§ | |
| * | Assumes initial investment on January 1, 1998. |
| ** | Lehman Brothers Aggregate Bond Index is composed of securities from Lehman Brothers Government/Corporate Bond Index, Mortgage-Backed Securities Index, and the Asset-Backed Securities Index. Total return comprises price appreciation/ depreciation and income as a percentage of the original investment. Indexes are rebalanced monthly by market capitalization. |
| § | Annualized. |
Performance is historical and assumes reinvestment of all dividends and capital gains. Investment return and principal value will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than when purchased. Past performance is not indicative of future results.
| 62 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Portfolio Management Discussion and Analysis — December 31, 2007 (Unaudited)
The Core Bond Fund (the “Fund”) allocates most of its assets among multiple money managers. Russell Investment Management Company (“RIMCo”), as the Fund’s advisor, may change the allocation of the Fund’s assets among money managers at any time. An exemptive order from the Securities and Exchange Commission (SEC) permits RIMCo to engage or terminate a money manager at any time, subject to the approval by the Fund’s Board without a shareholder vote. Pursuant to the terms of the exemptive order, the Fund is required to notify its shareholders within 60 days of when a money manager begins providing services. The Fund currently has three money managers.
What is the Fund’s investment objective?
The Fund seeks to provide current income and the preservation of capital.
How did the Fund perform relative to its benchmark for the fiscal year ended December 31, 2007?
For the fiscal year ended December 31, 2007, the Core Bond Fund gained 7.24%. This compared to its benchmark the Lehman Brothers Aggregate Bond Index, which gained 6.97%. The Fund’s performance includes operating expenses, whereas Index returns are unmanaged and do not include expenses of any kind.
For the year ended December 31, 2007, the Lipper® BBB Rated Corp Debt Funds (VIP) Average returned 5.27%. This result serves as a peer comparison and is expressed net of operating expenses.
How did the market conditions described in the Market Summary report affect the Fund’s performance?
Investors’ flight to the relative safety of U.S. Treasuries and the subsequent re-pricing of risk (i.e., the market demanding increased compensation for assuming a given level of risk) impacted nearly all non-Treasury fixed income investments. As a result, non-Treasury investments posted lower returns than the benchmark. Given that the Fund’s money managers typically invest in non-Treasury sectors, the Fund was generally hurt by exposure to so-called “spread sectors” (e.g., mortgages, corporates, asset-backed securities), but benefited significantly by underweighting investment grade corporates versus its benchmark.
The decline in short-term interest rates benefited the Fund as several of the Fund’s managers anticipated the decline and increased sensitivity to interest rates (also called increased duration). In general, as interest rates decline bond prices increase. Therefore, the increase in duration had a positive impact on performance.
Finally, as the Federal Reserve decreased the federal funds rate, intermediate maturity yields also declined resulting in a shift in yields otherwise known as a shift in the yield curve. This yield curve movement benefited the Fund as the Fund’s money managers anticipated the change and varied the maturity of their holdings.
Overall, managers’ investment decisions resulted in the Fund outperforming both its Index and its peers as measured by the Lipper® BBB Rated Corp Debt Funds (VIP) Average.
How did the investment strategies and techniques employed by the Fund and its money managers affect its performance?
By far, the largest impact on Fund performance was from the re-pricing of risk (i.e., the market demanding increased compensation for assuming a given level of risk) and the concern with the consumer’s ability to make mortgage payments. This fear of consumer creditworthiness also spread to broader market sectors and securities that have less exposure to consumer risk, which in turn added to volatility and lower returns. The Fund’s exposure to consumer-related investments in mortgage-backed and asset-backed sectors negatively impacted performance in these sectors. Being defensively positioned with respect to credit, however, was beneficial.
At the manager level, Pacific Investment Management Company LLC (“PIMCO”) was the best performing manager mainly due to its yield curve and sector allocation decisions. Goldman Sachs Asset Management, L.P. also generated positive performance as duration management as well as investments in securities outside of the United States generated positive excess return. Bear Stearns Asset Management Inc. underperformed over the year due to its duration positioning and exposure to securitized products such as mortgage-backed and asset-backed securities.
Describe any changes to the Fund’s structure or the money manager line-up.
There were no changes to the Fund’s structure or money manager line-up during the fiscal year.
| Money Managers as of December 31, 2007 | Styles | |
Bear Stearns Asset Management Inc. | Sector Rotation | |
Goldman Sachs Asset Management, L.P. | Fully Discretionary | |
Pacific Investment Management Company LLC | Fully Discretionary | |
The views expressed in this report reflect those of the portfolio managers only through the end of the period covered by the report. These views do not necessarily represent the views of Russell Investment Management Company (RIMCo), or any other person in RIMCo or any other affiliated organization. These views are subject to change at any time based upon market conditions or other events, and RIMCo disclaims any responsibility to update the views contained herein. These views should not be relied on as investment advice and, because investment decisions for Russell Investment Funds (RIF) are based on numerous factors, should not be relied on as an indication of investment decisions of any RIF Fund.
| Core Bond Fund | 63 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Shareholder Expense Example — December 31, 2007 (Unaudited)
Fund Expenses
The following disclosure provides important information regarding each Fund’s Expense Example, which appears on each Fund’s individual page in this Annual Report. Please refer to this information when reviewing the Expense Example for a Fund.
Example
As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, and (2) ongoing costs, including management fees and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for this Fund is from July 1, 2007 to December 31, 2007.
Actual Expenses
The information in the table under the heading “Actual Performance” provides information about actual account values and actual expenses. You may use the information in this column, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first column in the row entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical Performance (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs. Therefore, the information under the heading “Hypothetical Performance (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Actual Performance | Hypothetical Performance (5% return before expenses) | |||||
Beginning Account Value | ||||||
July 1, 2007 | $ | 1,000.00 | $ | 1,000.00 | ||
Ending Account Value | ||||||
December 31, 2007 | $ | 1,060.60 | $ | 1,021.68 | ||
Expenses Paid During Period* | $ | 3.64 | $ | 3.57 | ||
| * | Expenses are equal to the Fund’s annualized expense ratio of 0.70% (representing the six month period annualized), multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Reflects amounts waived and/or reimbursed by the investment adviser. Without the waiver and/or reimbursement, expenses would have been higher. |
| 64 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Schedule of Investments — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Long-Term Investments - 90.6% | ||||
Asset-Backed Securities - 3.6% | ||||
Accredited Mortgage Loan Trust (Ê) | ||||
Series 2004-2 Class A2 | ||||
5.165% due 07/25/34 | 41 | 40 | ||
ACE Securities Corp. (Ê) | ||||
Series 2003-OP1 Class M2 | ||||
6.365% due 12/25/33 | 55 | 53 | ||
Series 2005-SD3 Class A | ||||
5.265% due 08/25/45 | 236 | 223 | ||
Aegis Asset Backed Securities Trust (Ê) | 110 | 72 | ||
American Express Credit Account Master Trust (Ê) | ||||
Series 2004-C Class C (Å) | ||||
5.528% due 02/15/12 | 207 | 207 | ||
Series 2005-3 Class A | ||||
5.028% due 01/18/11 | 700 | 700 | ||
Ameriquest Mortgage Securities, Inc. (Ê) | ||||
Series 2002-D Class M1 | ||||
7.236% due 02/25/33 | 90 | 67 | ||
Series 2004-R8 Class A5 | ||||
5.235% due 09/25/34 | 29 | 29 | ||
Bayview Financial Acquisition Trust | 190 | 183 | ||
CIT Mortgage Loan Trust (Ê)(Þ) | ||||
Series 2007-1 Class 2A1 | ||||
5.865% due 10/01/37 | 425 | 418 | ||
Series 2007-1 Class 2A2 | ||||
6.115% due 10/01/37 | 130 | 124 | ||
Series 2007-1 Class 2A3 | ||||
6.239% due 10/01/37 | 180 | 164 | ||
Countrywide Asset-Backed Certificates | ||||
Series 2004-13 Class AF3 | ||||
3.989% due 02/25/31 | 7 | 7 | ||
Series 2004-AB2 Class M3 (Ê) | ||||
5.465% due 05/25/36 | 95 | 83 | ||
Series 2004-BC1 Class M1 (Ê) | ||||
5.365% due 02/25/34 | 95 | 88 | ||
Series 2006-11 Class 1AF4 | ||||
6.300% due 09/25/46 | 170 | 158 | ||
Countrywide Home Equity Loan Trust (Ê) | 698 | 652 |
| Principal Amount ($) or Shares | Market Value $ | |||
First Franklin Mortgage Loan Asset Backed Certificates (Ê) | 213 | 207 | ||
GMAC Mortgage Corp. Loan Trust | 97 | 98 | ||
GSAA Trust | ||||
Series 2006-2 Class 2A3 (Ê) | ||||
5.135% due 12/25/35 | 320 | 314 | ||
Series 2006-4 Class 1A2 | ||||
5.951% due 03/25/36 | 234 | 232 | ||
GSAMP Trust (Ê) | ||||
Series 2003-HE2 Class M1 | ||||
5.515% due 08/25/33 | 131 | 117 | ||
Series 2004-SEA Class A2A | ||||
5.155% due 03/25/34 | 59 | 59 | ||
HFC Home Equity Loan Asset Backed Certificates (Ê) | ||||
Series 2005-1 Class A | ||||
5.239% due 01/20/34 | 224 | 219 | ||
Series 2007-3 Class APT | ||||
6.149% due 11/20/36 | 434 | 424 | ||
Home Equity Asset Trust (Ê) | 4 | 4 | ||
HSI Asset Securitization Corp. Trust (Ê) | 73 | 70 | ||
Indymac Residential Asset Backed Trust (Ê) | 427 | 387 | ||
Lehman XS Trust (Ê) | ||||
Series 2005-1 Class 2A2 | ||||
4.660% due 07/25/35 | 117 | 117 | ||
Series 2006-16N Class A1A | ||||
4.945% due 11/25/46 | 173 | 166 | ||
Series 2007-4N Class 3A2A | ||||
5.683% due 04/25/37 | 900 | 846 | ||
Long Beach Mortgage Loan Trust (Ê) | ||||
Series 2004-4 Class 1A1 | ||||
5.145% due 10/25/34 | 5 | 4 | ||
Series 2006-9 Class 2A1 | ||||
4.925% due 10/25/36 | 606 | 591 | ||
Mastr Asset Backed Securities Trust (Ê) | 57 | 48 |
| Core Bond Fund | 65 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Morgan Stanley ABS Capital I (Ê) | ||||
Series 2003-NC8 Class M3 | ||||
6.965% due 09/25/33 | 38 | 32 | ||
Series 2006-HE7 Class A2A | ||||
4.915% due 09/25/36 | 552 | 538 | ||
New Century Home Equity Loan Trust (Ê) Series 2004-4 Class M2 | 215 | 202 | ||
Option One Mortgage Loan Trust (Ê) | ||||
Series 2003-2 Class M2 | ||||
6.565% due 04/25/33 | 48 | 41 | ||
Series 2003-3 Class M3 | ||||
6.865% due 06/25/33 | 38 | 29 | ||
Series 2003-4 Class M2 | ||||
6.515% due 07/25/33 | 31 | 28 | ||
Park Place Securities, Inc. (Ê) | 210 | 176 | ||
Popular ABS Mortgage Pass-Through Trust Series 2005-6 Class A3 | 230 | 228 | ||
Renaissance Home Equity Loan Trust | ||||
Series 2005-1 Class M1 | ||||
5.357% due 05/25/35 | 80 | 70 | ||
Series 2005-2 Class AF4 | ||||
4.934% due 08/25/35 | 85 | 78 | ||
Series 2006-1 Class AF6 | ||||
5.746% due 05/25/36 | 175 | 162 | ||
Residential Asset Mortgage Products, Inc. | ||||
Series 2003-RS1 Class AI6A | ||||
5.980% due 12/25/33 | 197 | 196 | ||
Series 2006-RZ4 Class A1A (Ê) | ||||
4.945% due 10/25/36 | 711 | 692 | ||
Residential Asset Securities Corp. | ||||
Series 2003-KS2 Class MI1 | ||||
4.800% due 04/25/33 | 450 | 426 | ||
Series 2003-KS2 Class MI3 | ||||
6.100% due 04/25/33 | 83 | 61 | ||
Series 2006-KS9 Class AI1 (Ê) | ||||
4.935% due 11/25/36 | 168 | 164 | ||
Series 2007-KS2 Class AI1 (Ê) | ||||
4.935% due 02/25/37 | 390 | 382 | ||
SBI Heloc Trust (Ê)(þ) | 113 | 108 | ||
SLM Student Loan Trust (Ê) | 683 | 682 |
| Principal Amount ($) or Shares | Market Value $ | |||
Small Business Administration | 6 | 6 | ||
Soundview Home Equity Loan Trust | ||||
Series 2006-2 Class A2 (Ê) | ||||
4.995% due 03/25/36 | 155 | 154 | ||
Series 2006-WF1 Class A2 | ||||
5.645% due 10/25/36 | 290 | 287 | ||
Structured Asset Investment Loan Trust (Ê) | 120 | 100 | ||
Structured Asset Securities Corp. | ||||
Series 2004-19X Class A2 | ||||
4.370% due 10/25/34 | 120 | 119 | ||
Series 2006-BC3 Class A2 (Ê) | ||||
4.915% due 10/25/36 | 182 | 179 | ||
VTB 24 Capital PLC (Ê) | 100 | 97 | ||
| 12,408 | ||||
Certificates of Deposit - 0.2% | ||||
Calyon NY | 300 | 300 | ||
Nordea Bank Finland PLC | 400 | 400 | ||
| 700 | ||||
Corporate Bonds and Notes - 19.0% | ||||
Abbott Laboratories | ||||
5.600% due 05/15/11 | 260 | 269 | ||
5.875% due 05/15/16 | 80 | 84 | ||
Ace Capital Trust II | 175 | 222 | ||
Alamosa Delaware, Inc. | 100 | 102 | ||
Alion Science and Technology Corp. | 200 | 171 | ||
Allied Waste NA, Inc. (Ñ) | 90 | 89 | ||
Altria Group, Inc. | 25 | 32 | ||
American Casino & Entertainment Properties LLC | 115 | 119 | ||
American Electric Power Co., Inc. | 35 | 36 | ||
| 66 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
American Express Bank FSB | 400 | 402 | ||
American Express Centurion Bank | 250 | 254 | ||
Series BKN1 | ||||
6.000% due 09/13/17 | 400 | 402 | ||
American General Finance Corp. | ||||
4.875% due 05/15/10 | 225 | 226 | ||
6.900% due 12/15/17 | 400 | 400 | ||
American International Group, Inc. | ||||
4.700% due 10/01/10 | 130 | 130 | ||
5.375% due 10/18/11 | 195 | 198 | ||
5.050% due 10/01/15 | 265 | 256 | ||
5.850% due 01/16/18 | 900 | 906 | ||
6.250% due 03/15/87 | 150 | 134 | ||
Americo Life, Inc. (Å) | 75 | 77 | ||
Amkor Technology, Inc. | 175 | 165 | ||
Anadarko Petroleum Corp. | 100 | 102 | ||
ANZ Capital Trust (ƒ)(Þ) | 225 | 221 | ||
Appalachian Power Co. | 65 | 66 | ||
Series O | ||||
Arizona Public Service Co. | ||||
5.800% due 06/30/14 | 100 | 100 | ||
6.250% due 08/01/16 | 150 | 153 | ||
AT&T Mobility LLC | 120 | 126 | ||
AT&T, Inc. | ||||
5.100% due 09/15/14 | 45 | 45 | ||
6.500% due 09/01/37 | 125 | 131 | ||
6.300% due 01/15/38 | 875 | 889 | ||
Atmos Energy Corp. | 65 | 66 | ||
BAE Systems Holdings, Inc. (Þ) | 395 | 416 | ||
Bank of America Corp. | ||||
5.875% due 02/15/09 | 80 | 81 | ||
4.875% due 11/06/09 (Ê) | 100 | 100 | ||
5.625% due 10/14/16 | 115 | 116 | ||
6.000% due 09/01/17 | 335 | 342 | ||
5.750% due 12/01/17 | 150 | 150 |
| Principal Amount ($) or Shares | Market Value $ | |||
Bank of America NA | ||||
5.133% due 06/12/09 | 700 | 698 | ||
5.271% due 06/15/16 | 200 | 195 | ||
Bank of New York Mellon Corp. (The) | 215 | 218 | ||
Bausch & Lomb, Inc. (Þ) | 125 | 127 | ||
Bear Stearns Cos., Inc. (The) | ||||
5.494% due 07/16/09 (Ê) | 1,200 | 1,154 | ||
6.950% due 08/10/12 | 600 | 617 | ||
BellSouth Corp. | ||||
4.240% due 04/26/21 (Þ) | 300 | 299 | ||
6.550% due 06/15/34 | 35 | 36 | ||
Bellsouth Telecommunications, Inc. | 245 | 255 | ||
BNP Paribas Capital Trust (ƒ)(Å) | 450 | 482 | ||
Boardwalk Pipelines, LP | 225 | 230 | ||
Boeing Capital Corp., Ltd. (Ñ) | 50 | 52 | ||
Burlington Northern Santa Fe Corp. | ||||
5.650% due 05/01/17 | 105 | 104 | ||
6.875% due 12/01/27 | 25 | 26 | ||
6.750% due 03/15/29 | 10 | 10 | ||
California Steel Industries, Inc. | 385 | 339 | ||
Caterpillar Financial Services Corp. | ||||
4.965% due 05/18/09 (Ê) | 1,100 | 1,097 | ||
4.300% due 06/01/10 | 170 | 169 | ||
4.850% due 12/07/12 (Ñ) | 145 | 145 | ||
5.850% due 09/01/17 | 95 | 98 | ||
Catlin Insurance Co., Ltd. (ƒ)(Å) | 100 | 91 | ||
CenterPoint Energy Houston | ||||
Series J2 | 110 | 111 | ||
CenterPoint Energy Resources Corp. | ||||
6.125% due 11/01/17 | 50 | 51 | ||
Series B | ||||
7.875% due 04/01/13 | 165 | 181 | ||
Chubb Corp. | ||||
6.375% due 03/29/37 (Ñ) | 175 | 171 | ||
6.000% due 05/11/37 | 95 | 90 | ||
CIT Group, Inc. | 45 | 45 |
| Core Bond Fund | 67 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Citigroup Capital XXI | 100 | 106 | ||
Citigroup Funding, Inc. (Ê) | ||||
4.896% due 04/23/09 | 100 | 99 | ||
4.858% due 06/26/09 | 200 | 197 | ||
Citigroup Global Markets | 200 | 198 | ||
Citigroup, Inc. | ||||
5.024% due 01/30/09 (Ê) | 100 | 99 | ||
5.228% due 12/28/09 (Ê) | 400 | 393 | ||
6.500% due 01/18/11 | 245 | 256 | ||
5.500% due 08/27/12 (Ñ) | 200 | 204 | ||
5.850% due 07/02/13 | 425 | 438 | ||
4.700% due 05/29/15 (Ñ) | 50 | 47 | ||
5.850% due 08/02/16 (Ñ) | 55 | 56 | ||
6.000% due 08/15/17 (Ñ) | 400 | 408 | ||
6.125% due 08/25/36 | 300 | 284 | ||
Citizens Communications Co.(Ñ) | 125 | 135 | ||
Clorox Co. | 100 | 99 | ||
CNA Financial Corp. | 125 | 128 | ||
Columbus Southern Power Co. | 10 | 10 | ||
Comcast Cable Communications Holdings, Inc. | ||||
9.455% due 11/15/22 | 125 | 159 | ||
Comcast Cable Holdings LLC | ||||
9.800% due 02/01/12 | 180 | 208 | ||
7.875% due 08/01/13 | 335 | 367 | ||
Comcast Corp. | ||||
5.900% due 03/15/16 | 115 | 116 | ||
6.500% due 01/15/17 | 65 | 68 | ||
6.450% due 03/15/37 | 80 | 81 | ||
Commonwealth Edison Co. | ||||
6.950% due 07/15/18 | 50 | 51 | ||
5.900% due 03/15/36 | 75 | 70 | ||
Series 105 | ||||
5.400% due 12/15/11 | 125 | 126 | ||
Series 98 | ||||
6.150% due 03/15/12 | 80 | 83 | ||
Community Health Systems, Inc. | 165 | 168 | ||
COX Communications, Inc. | ||||
4.625% due 01/15/10 (Ñ) | 350 | 347 | ||
5.875% due 12/01/16 (Þ) | 75 | 75 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Credit Suisse USA, Inc. | ||||
4.875% due 08/15/10 | 65 | 66 | ||
5.250% due 03/02/11 (Ñ) | 55 | 56 | ||
6.500% due 01/15/12 | 25 | 26 | ||
5.500% due 08/15/13 (Ñ) | 45 | 46 | ||
4.875% due 01/15/15 | 55 | 54 | ||
CSC Holdings, Inc. | ||||
Series B | ||||
8.125% due 07/15/09 | 210 | 213 | ||
8.125% due 08/15/09 | 175 | 178 | ||
6.750% due 04/15/12 | 90 | 86 | ||
CVS Caremark Corp. | ||||
5.750% due 08/15/11 | 215 | 220 | ||
5.750% due 06/01/17 | 180 | 181 | ||
Daimler Finance NA LLC | ||||
5.461% due 03/13/09 (Ê) | 400 | 398 | ||
5.541% due 03/13/09 (Ê)(Ñ) | 300 | 298 | ||
6.500% due 11/15/13 | 145 | 152 | ||
Dayton Power & Light Co. (The) | 135 | 134 | ||
DCP Midstream LLC (Ñ) | 20 | 21 | ||
Delta Air Lines, Inc. | 205 | 207 | ||
Detroit Edison Co. (The) | 50 | 51 | ||
Devon Financing Corp. ULC | 100 | 121 | ||
Dex Media West LLC/Dex Media Finance Co. | 245 | 255 | ||
Dominion Resources, Inc. | ||||
Series A | ||||
5.200% due 01/15/16 | 240 | 233 | ||
Series B | ||||
6.250% due 06/30/12 (Ñ) | 66 | 69 | ||
DPL, Inc. | 193 | 205 | ||
Drummond Co., Inc. (Þ) | 160 | 148 | ||
Echostar DBS Corp. | 125 | 128 | ||
El Paso Corp. | 200 | 208 | ||
El Paso Natural Gas Co. | 100 | 105 |
| 68 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Eli Lilly & Co. (Ñ) | 305 | 305 | ||
Energy Transfer Partners, LP | 325 | 319 | ||
Enterprise Products Operating, LP | ||||
4.950% due 06/01/10 | 125 | 125 | ||
8.375% due 08/01/66 | 100 | 102 | ||
Exelon Generation Co. LLC | 40 | 40 | ||
FedEx Corp. | 75 | 89 | ||
.Financing Corp. | ||||
Principal Only STRIP | ||||
Series 2P | ||||
Zero coupon due 11/30/17 | 60 | 38 | ||
Series 6P | ||||
Zero coupon due 08/03/18 | 300 | 184 | ||
Series 10P | ||||
Zero coupon due 11/30/17 | 510 | 325 | ||
Series 15P | ||||
Zero coupon due 03/07/19 | 70 | 42 | ||
FirstEnergy Corp. | ||||
Series B | ||||
6.450% due 11/15/11 | 280 | 289 | ||
Series C | ||||
7.375% due 11/15/31 | 125 | 137 | ||
Fiserv, Inc. | 335 | 341 | ||
Ford Motor Credit Co. LLC | 200 | 185 | ||
Freeport-McMoRan Copper & Gold, Inc. 8.375% due 04/01/17 | 415 | 445 | ||
General Electric Capital Corp. | ||||
5.250% due 01/20/10 (Ê) | 200 | 198 | ||
5.250% due 10/19/12 | 175 | 179 | ||
6.375% due 11/15/67 | 1,900 | 1,962 | ||
Series GMTN | ||||
5.500% due 04/28/11 | 220 | 226 | ||
Series MTN (Ê) | ||||
5.095% due 10/26/09 | 500 | 499 | ||
Series MTNA | ||||
5.450% due 01/15/13 | 405 | 417 | ||
General Electric Co. | 65 | 65 | ||
Goldman Sachs Group, Inc. (The) | ||||
5.248% due 03/30/09 (Ê) | 400 | 398 | ||
6.875% due 01/15/11 | 565 | 599 | ||
5.350% due 01/15/16 (Ñ) | 410 | 406 | ||
5.625% due 01/15/17 (Ñ) | 80 | 78 | ||
6.250% due 09/01/17 (Ñ) | 600 | 624 | ||
6.750% due 10/01/37 | 935 | 916 |
| Principal Amount ($) or Shares | Market Value $ | |||
GrafTech Finance, Inc. | 125 | 129 | ||
Harrah’s Operating Co., Inc. | 125 | 116 | ||
Hawaiian Telcom Communications, Inc. (Ê) | 240 | 242 | ||
HCA, Inc. | ||||
9.125% due 11/15/14 | 125 | 130 | ||
9.250% due 11/15/16 | 120 | 126 | ||
HCP, Inc. | 300 | 301 | ||
Historic TW, Inc. | ||||
8.050% due 01/15/16 | 195 | 217 | ||
6.625% due 05/15/29 | 10 | 10 | ||
Home Depot, Inc. | 35 | 33 | ||
HSBC Finance Corp. | ||||
5.240% due 10/21/09 (Ê) | 100 | 100 | ||
5.213% due 03/12/10 (Ê) | 300 | 294 | ||
5.137% due 05/10/10 (Ê) | 100 | 97 | ||
6.375% due 11/27/12 | 185 | 190 | ||
5.000% due 06/30/15 | 110 | 105 | ||
Idearc, Inc. | 125 | 115 | ||
Inmarsat Finance PLC (Ñ) | 125 | 121 | ||
International Business Machines Corp. | 230 | 250 | ||
International Lease Finance Corp. | ||||
5.750% due 06/15/11 | 80 | 81 | ||
5.625% due 09/20/13 (Ñ) | 80 | 80 | ||
International Paper Co. | 510 | 519 | ||
International Steel Group, Inc. (Ñ) | 210 | 216 | ||
iPCS, Inc. (Ê) | 35 | 33 | ||
iStar Financial, Inc. | 200 | 178 | ||
Jersey Central Power & Light Co. | 90 | 88 | ||
Johnson & Johnson | ||||
5.550% due 08/15/17 | 75 | 79 | ||
5.950% due 08/15/37 | 40 | 43 | ||
JP Morgan Chase Bank | 860 | 758 |
| Core Bond Fund | 69 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
JPMorgan Chase & Co. | ||||
5.600% due 06/01/11 | 115 | 119 | ||
5.375% due 01/15/14 | 170 | 169 | ||
6.000% due 01/15/18 | 265 | 270 | ||
JPMorgan Chase Bank NA | ||||
Series BKNT | ||||
5.875% due 06/13/16 | 70 | 71 | ||
6.000% due 10/01/17 | 400 | 407 | ||
Kellogg Co. | 445 | 472 | ||
Kerr-McGee Corp. | 125 | 134 | ||
Kraft Foods, Inc. | ||||
5.625% due 11/01/11 | 575 | 588 | ||
6.500% due 08/11/17 | 100 | 103 | ||
6.125% due 02/01/18 | 200 | 202 | ||
Kroger Co. (The) | ||||
8.000% due 09/15/29 | 15 | 17 | ||
7.500% due 04/01/31 | 25 | 28 | ||
L-3 Communications Corp. | 125 | 123 | ||
Lehman Brothers Holdings, Inc. | ||||
5.241% due 01/23/09 (Ê)(Ñ) | 600 | 588 | ||
5.320% due 04/03/09 (Ê) | 400 | 391 | ||
5.170% due 05/25/10 (Ê) | 200 | 192 | ||
5.250% due 02/06/12 | 85 | 84 | ||
5.375% due 10/17/12 | 250 | 348 | ||
6.200% due 09/26/14 (Ñ) | 375 | 382 | ||
5.500% due 04/04/16 | 100 | 96 | ||
Level 3 Communications, Inc. | 60 | 56 | ||
Level 3 Financing, Inc. | 150 | 152 | ||
M&T Bank Corp. | 215 | 214 | ||
Mandalay Resort Group | 90 | 90 | ||
Manufacturers & Traders Trust Co. | 84 | 78 | ||
Mashantucket Western Pequot Tribe (Þ) | 235 | 237 | ||
McLeodUSA, Inc. (Þ) | 225 | 251 | ||
MedQuest, Inc. (Ñ) | 225 | 235 |
| Principal Amount ($) or Shares | Market Value $ | |||
Merrill Lynch & Co., Inc. | ||||
5.211% due 12/04/09 (Ê) | 200 | 194 | ||
6.050% due 08/15/12 | 290 | 296 | ||
6.050% due 05/16/16 | 85 | 84 | ||
5.700% due 05/02/17 (Ñ) | 65 | 62 | ||
6.400% due 08/28/17 (Ñ) | 435 | 442 | ||
Series MTN (Ê) | ||||
4.948% due 05/08/09 | 900 | 876 | ||
Series MTNC | ||||
4.250% due 02/08/10 | 25 | 25 | ||
MetLife, Inc. | 100 | 92 | ||
Metropolitan Life Global | 400 | 397 | ||
MGM Mirage | 300 | 292 | ||
Midamerican Energy Holdings Co. | 150 | 150 | ||
Miller Brewing Co. (Þ) | 110 | 111 | ||
Mohegan Tribal Gaming Authority | 125 | 127 | ||
Morgan Stanley | ||||
4.925% due 05/07/09 (Ê) | 300 | 296 | ||
5.375% due 10/15/15 | 125 | 122 | ||
5.550% due 04/27/17 | 70 | 68 | ||
6.250% due 08/28/17 (Ñ) | 100 | 102 | ||
5.950% due 12/28/17 (Ñ) | 225 | 225 | ||
Series GMTN | ||||
5.006% due 02/09/09 (Ê) | 500 | 494 | ||
5.750% due 08/31/12 | 125 | 128 | ||
Series MTN (Ê) | ||||
5.333% due 01/15/10 | 300 | 297 | ||
Natexis Ambs Co. LLC (ƒ)(Þ) | 120 | 122 | ||
National Rural Utilities Cooperative Finance Corp. | ||||
5.750% due 08/28/09 | 45 | 46 | ||
5.450% due 04/10/17 | 215 | 214 | ||
Neff Corp. (Ñ) | 80 | 44 | ||
Nelnet, Inc. | 125 | 120 | ||
Nevada Power Co. | 100 | 99 | ||
New Cingular Wireless Services, Inc. | ||||
7.875% due 03/01/11 | 150 | 162 | ||
8.125% due 05/01/12 | 155 | 172 | ||
8.750% due 03/01/31 | 85 | 110 |
| 70 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
News America Holdings, Inc. | ||||
7.750% due 12/01/45 | 65 | 70 | ||
7.900% due 12/01/95 | 90 | 100 | ||
8.250% due 10/17/96 | 20 | 23 | ||
News America, Inc. (Å) | 225 | 232 | ||
NGPL PipeCo LLC (Þ) | 200 | 203 | ||
Nisource Finance Corp. | ||||
7.875% due 11/15/10 | 125 | 133 | ||
6.400% due 03/15/18 | 145 | 145 | ||
Noranda Aluminium Acquisition | 130 | 109 | ||
Norfolk Southern Corp. | ||||
7.700% due 05/15/17 | 20 | 23 | ||
7.050% due 05/01/37 | 90 | 98 | ||
7.900% due 05/15/97 | 470 | 544 | ||
Nuveen Investments, Inc. (Þ) | 235 | 234 | ||
Ohio Power Co. | 20 | 20 | ||
ONEOK Partners, LP | ||||
6.650% due 10/01/36 | 100 | 101 | ||
6.850% due 10/15/37 | 100 | 104 | ||
Pacific Gas & Electric Co. | ||||
4.200% due 03/01/11 | 60 | 59 | ||
6.050% due 03/01/34 | 95 | 95 | ||
PAETEC Holding Corp. (Þ) | 305 | 297 | ||
PartnerRe Finance II | 50 | 44 | ||
Phoenix Life Insurance Co. (Þ) | 150 | 164 | ||
Pride International, Inc. | 185 | 190 | ||
Progress Energy, Inc. | ||||
7.100% due 03/01/11 | 77 | 82 | ||
5.625% due 01/15/16 | 40 | 40 | ||
7.000% due 10/30/31 | 90 | 98 | ||
Prudential Financial, Inc. | 110 | 110 | ||
Qwest Corp. | 100 | 102 | ||
RBS Capital Trust III (ƒ) | 200 | 184 | ||
Reckson Operating Partnership, LP | ||||
7.750% due 03/15/09 | 25 | 26 | ||
5.150% due 01/15/11 | 92 | 93 |
| Principal Amount ($) or Shares | Market Value $ | |||
Reinsurance Group of America, Inc. (Ñ) | 75 | 67 | ||
Residential Capital LLC | 200 | 128 | ||
Rohm & Haas Co. (Ñ) | 100 | 102 | ||
Ryerson, Inc. (Þ) | 225 | 222 | ||
Safeway, Inc. | 20 | 22 | ||
SB Treasury Co. LLC (ƒ)(Å) | 350 | 357 | ||
Schering-Plough Corp. | 200 | 202 | ||
Simon Property Group, LP | 200 | 201 | ||
Southern Natural Gas Co. | 75 | 78 | ||
Spansion, Inc. (Ñ)(Þ) | 45 | 38 | ||
Sprint Capital Corp. | ||||
7.625% due 01/30/11 | 350 | 365 | ||
8.750% due 03/15/32 | 70 | 79 | ||
Sprint Nextel Corp. | 350 | 335 | ||
SPX Corp. (Þ) | 75 | 77 | ||
Swiss Re Capital I, LP (ƒ)(Þ) | 225 | 221 | ||
Symetra Financial Corp. (Å) | 150 | 149 | ||
Temple-Inland, Inc. | 202 | 223 | ||
Tennessee Gas Pipeline Co. (Ñ) | 50 | 50 | ||
Time Warner Cable, Inc. | ||||
5.400% due 07/02/12 | 600 | 601 | ||
5.850% due 05/01/17 | 155 | 155 | ||
6.550% due 05/01/37 (Ñ) | 175 | 179 | ||
Time Warner, Inc. (Ñ) | 400 | 398 | ||
Travelers Cos., Inc. (The) | ||||
5.375% due 06/15/12 | 40 | 41 | ||
6.250% due 06/15/37 | 100 | 97 | ||
Travelport LLC (Ñ) | 130 | 139 | ||
UBS AG | 270 | 157 |
| Core Bond Fund | 71 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Unilever Capital Corp. (Ñ) | 130 | 129 | ||
Union Electric Co. | 205 | 215 | ||
Union Pacific Corp. | 120 | 125 | ||
Union Planters Corp. | 50 | 53 | ||
United States Steel Corp. | ||||
5.650% due 06/01/13 | 135 | 131 | ||
6.050% due 06/01/17 | 95 | 89 | ||
6.650% due 06/01/37 | 40 | 36 | ||
United Technologies Corp. | 145 | 146 | ||
UnitedHealth Group, Inc. | ||||
5.250% due 03/15/11 | 95 | 96 | ||
6.000% due 06/15/17 (Þ) | 35 | 35 | ||
6.500% due 06/15/37 (Þ) | 45 | 45 | ||
Verizon Communications, Inc. (Ê) | 500 | 495 | ||
Verizon Global Funding Corp. (Ñ) | 1,465 | 1,585 | ||
Wachovia Capital Trust III (ƒ) | 125 | 112 | ||
Wachovia Corp. | ||||
5.625% due 10/15/16 | 100 | 99 | ||
5.750% due 06/15/17 (Ñ) | 155 | 154 | ||
Wachovia Mortgage FSB (Ê) | 1,000 | 1,001 | ||
Wells Fargo & Co. | ||||
5.250% due 10/23/12 | 135 | 136 | ||
4.950% due 10/16/13 | 65 | 65 | ||
5.625% due 12/11/17 | 1,005 | 1,006 | ||
Wells Fargo Bank NA | 140 | 142 | ||
Weyerhaeuser Co. | 400 | 420 | ||
Windstream Corp. | 125 | 131 | ||
Wyeth | ||||
6.950% due 03/15/11 | 285 | 304 | ||
5.500% due 03/15/13 | 140 | 144 | ||
5.950% due 04/01/37 | 140 | 140 | ||
Xerox Corp. | 185 | 188 | ||
| 65,682 | ||||
| Principal Amount ($) or Shares | Market Value $ | |||
International Debt - 6.4% | ||||
Abbey National PLC (ƒ) | 150 | 147 | ||
Altos Hornos de Mexico SA de CV (Ø) | ||||
Series A | 220 | 158 | ||
America Movil SAB de CV | 100 | 99 | ||
Argentina Bonos | 650 | 572 | ||
Aspen Insurance Holdings, Ltd. | 50 | 51 | ||
AstraZeneca PLC (Ñ) | 100 | 105 | ||
AXA SA | ||||
8.600% due 12/15/30 | 35 | 43 | ||
6.463% due 12/31/49 (ƒ)(Ñ)(Þ) | 100 | 90 | ||
Bank of Scotland PLC (Ê)(Þ) | 300 | 300 | ||
Barclays Bank PLC | ||||
5.450% due 09/12/12 | 1,300 | 1,331 | ||
6.050% due 12/04/17 (Þ) | 200 | 199 | ||
BNP Paribas (ƒ)(Þ) | 300 | 273 | ||
British Telecommunications PLC | ||||
8.625% due 12/15/10 | 300 | 329 | ||
9.125% due 12/15/30 | 5 | 7 | ||
Canadian Natural Resources, Ltd. | ||||
6.000% due 08/15/16 | 40 | 41 | ||
5.700% due 05/15/17 (Ñ) | 75 | 75 | ||
6.500% due 02/15/37 | 170 | 170 | ||
CIT Group Funding Co. of Canada | 80 | 76 | ||
Citigroup Global Markets | ||||
Deutschland AG for OAO Gazprom | 200 | 216 | ||
Conoco Funding Co. | 340 | 361 | ||
Deutsche Bank AG (Ñ) | 600 | 622 | ||
Deutsche Telekom International Finance BV | ||||
5.064% due 03/23/09 (Ê) | 300 | 299 | ||
8.000% due 06/15/10 | 60 | 64 | ||
5.375% due 03/23/11 | 75 | 76 | ||
8.250% due 06/15/30 (Ñ) | 180 | 225 | ||
| 72 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
DNB Nor Bank ASA (Ê)(Þ) | 1,000 | 1,000 | ||
Egypt Government AID Bonds | 295 | 293 | ||
EnCana Corp. (Ñ) | 225 | 233 | ||
Endurance Specialty Holdings, Ltd. | 100 | 98 | ||
Enel Finance International SA (Þ) | 600 | 607 | ||
Export-Import Bank of China (Þ) | 110 | 108 | ||
Export-Import Bank of Korea | ||||
5.125% due 02/14/11 | 100 | 100 | ||
5.500% due 10/17/12 | 100 | 100 | ||
Federative Republic of Brazil (Ñ) | 590 | 599 | ||
10.25% due 01/10/28 | 1,845 | 995 | ||
FMG Finance Pty, Ltd. (Þ) | 565 | 647 | ||
Gaz Capital for Gazprom (Å) | 115 | 110 | ||
GTL Trade Finance, Inc. (Þ) | 105 | 107 | ||
HSBC Holdings PLC (Ñ) | ||||
6.500% due 05/02/36 | 175 | 170 | ||
6.500% due 09/15/37 | 100 | 97 | ||
Inco, Ltd. | 175 | 175 | ||
Intelsat Bermuda, Ltd. | ||||
8.886% due 01/15/15 (Ê) | 110 | 110 | ||
11.250% due 06/15/16 | 270 | 279 | ||
Intelsat Subsidiary Holding Co., Ltd. | 205 | 206 | ||
Intergen NV (Þ) | 185 | 195 | ||
Ispat Inland ULC | 639 | 692 | ||
Korea Development Bank (Ê)(Ñ) | 900 | 897 | ||
Korea Electric Power Corp. (Þ) | 60 | 61 | ||
Lukoil International Finance BV (Þ) | 340 | 322 | ||
Mizuho Financial Group Cayman, Ltd. (Þ) | 100 | 105 | ||
MUFG Capital Finance 1, Ltd. (ƒ) | 200 | 189 | ||
Peruvian Government International Bond (Ñ) | 160 | 188 |
| Principal Amount ($) or Shares | Market Value $ | |||
Petrobras International Finance Co. (Ñ) 8.375% due 12/10/18 | 295 | 351 | ||
Province of Quebec Canada Series PJ | 390 | 412 | ||
Ras Laffan Liquefied Natural Gas Co., Ltd. II (Þ) | 75 | 73 | ||
Ras Laffan Liquefied Natural Gas Co., Ltd. III (Þ) | 250 | 236 | ||
Resona Bank, Ltd. (ƒ)(Þ) | 255 | 237 | ||
Resona Preferred Global Securities Cayman, Ltd. (ƒ)(Å) | 325 | 322 | ||
Rogers Wireless, Inc. | 365 | 376 | ||
Royal Bank of Scotland Group PLC (ƒ) | 450 | 449 | ||
Series 1 | 700 | 748 | ||
Russia Government International | 342 | 389 | ||
Santander Perpetual SA Unipersonal (ƒ)(Þ) 6.671% due 10/29/49 | 300 | 301 | ||
Sanwa Finance Aruba AEC | 135 | 142 | ||
SMFG Preferred Capital USD 1, | 100 | 92 | ||
Sumitomo Mitsui Banking Corp. (ƒ)(Þ) 5.625% due 07/29/49 | 400 | 374 | ||
Systems 2001 Asset Trust LLC (Þ) 7.156% due 12/15/11 | 88 | 92 | ||
Telecom Italia Capital SA | ||||
4.875% due 10/01/10 | 150 | 149 | ||
6.200% due 07/18/11 | 105 | 108 | ||
5.250% due 10/01/15 | 150 | 146 | ||
Telefonica Emisiones SAU | ||||
5.226% due 06/19/09 (Ê) | 300 | 298 | ||
6.221% due 07/03/17 | 90 | 94 | ||
TNK-BP Finance SA (Þ) | 110 | 110 | ||
Transocean, Inc. | 50 | 51 | ||
Tyco Electronics Group SA (Þ) 6.000% due 10/01/12 | 50 | 51 |
| Core Bond Fund | 73 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Tyco International Group SA | 210 | 220 | ||
UBS AG Series DPNT | 200 | 201 | ||
UFJ Finance Aruba AEC | 35 | 38 | ||
Vale Overseas, Ltd. | ||||
6.250% due 01/11/16 | 35 | 35 | ||
6.250% due 01/23/17 | 120 | 120 | ||
Vedanta Resources PLC (Þ) | 245 | 244 | ||
Vodafone Group PLC | 125 | 123 | ||
VTB Capital SA (Þ) | 130 | 129 | ||
Western Oil Sands, Inc. | 255 | 284 | ||
Westfield Capital Corp., Ltd. (Þ) | 125 | 117 | ||
Westfield Group (Þ) | 125 | 125 | ||
Xstrata Canada Corp. | ||||
7.250% due 07/15/12 | 50 | 54 | ||
6.000% due 10/15/15 | 225 | 228 | ||
Xstrata Finance Canada, Ltd. (Þ) | 45 | 46 | ||
| 22,177 | ||||
Loan Agreements - 0.3% | ||||
Adam Aircraft | 85 | 68 | ||
DB UFC Zuffa Bank Loan | 239 | 199 | ||
Flextronics International, Ltd., Term Loan | ||||
7.394% due 10/01/14 | 135 | 131 | ||
7.395% due 10/03/14 | 9 | 9 | ||
7.455% due 10/15/14 | 41 | 40 | ||
Starbound Reinsurance, Ltd. | 420 | 420 | ||
Travelport Holdings, Ltd. | 125 | 118 | ||
TXU Corp. | 225 | 221 | ||
| 1,206 | ||||
Mortgage-Backed Securities - 54.5% | ||||
ABN Amro Mortgage Corp. | 1,612 | 1,529 | ||
| Principal Amount ($) or Shares | Market Value $ | |||
Adjustable Rate Mortgage Trust (Ê) | 87 | 87 | ||
Series 2005-3 Class 8A2 | 180 | 176 | ||
American Home Mortgage Assets (Ê) | 887 | 828 | ||
American Home Mortgage Investment Trust (Ê) Series 2004-4 Class 4A | 126 | 121 | ||
Series 2005-2 Class 5A2 | 25 | 25 | ||
Banc of America Alternative Loan Trust | ||||
Series 2003-2 Class CB2 (Ê) | ||||
5.365% due 04/25/33 | 87 | 86 | ||
Series 2003-10 Class 2A2 (Ê) | ||||
5.315% due 12/25/33 | 212 | 208 | ||
Series 2006-5 Class CB17 | ||||
6.000% due 06/25/36 | 220 | 217 | ||
Banc of America Commercial Mortgage, Inc. | ||||
Series 2004-3 Class A3 | ||||
4.875% due 06/10/39 | 264 | 264 | ||
Series 2004-4 Class A3 | ||||
4.128% due 07/10/42 | 710 | 704 | ||
Series 2005-2 Class A4 | ||||
4.783% due 07/10/43 | 333 | 328 | ||
Series 2005-3 Class A2 | ||||
4.501% due 07/10/43 | 150 | 148 | ||
Series 2005-5 Class A4 | ||||
5.115% due 10/10/45 | 500 | 493 | ||
Series 2006-1 Class A4 | ||||
5.372% due 09/10/45 | 200 | 201 | ||
Banc of America Funding Corp. | ||||
Series 2005-D Class A1 (Ê) | ||||
4.112% due 05/25/35 | 142 | 141 | ||
Series 2006-3 Class 5A8 | ||||
5.500% due 03/25/36 | 475 | 464 | ||
Series 2006-A Class 3A2 | ||||
5.880% due 02/20/36 | 182 | 181 | ||
Series 2006-A Class 4A1 (Ê) | ||||
5.565% due 02/20/36 | 473 | 469 | ||
Banc of America Mortgage Securities, Inc. | ||||
Series 2003-9 Class 1A12 (Ê) | ||||
5.315% due 12/25/33 | 403 | 401 | ||
Series 2004-1 Class 5A1 | ||||
6.500% due 09/25/33 | 16 | 16 |
| 74 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2004-2 Class 1A9 (Ê) | ||||
5.315% due 03/25/34 | 205 | 204 | ||
Series 2004-11 Class 2A1 | ||||
5.750% due 01/25/35 | 406 | 405 | ||
Series 2005-H Class 2A5 (Ê) | ||||
4.803% due 09/25/35 | 220 | 214 | ||
Series 2005-L Class 3A1 (Ê) | ||||
5.464% due 01/25/36 | 236 | 233 | ||
Series 2006-2 Class A15 | ||||
6.000% due 07/25/36 | 268 | 273 | ||
Series 2007-3 Class 1A1 | ||||
6.000% due 09/25/37 | 909 | 906 | ||
Bear Stearns Adjustable Rate Mortgage Trust | ||||
Series 2003-1 Class 6A1 | ||||
5.037% due 04/25/33 | 65 | 65 | ||
Series 2003-8 Class 4A1 | ||||
4.609% due 01/25/34 | 133 | 131 | ||
Series 2004-1 Class 21A1 | ||||
4.457% due 04/25/34 | 112 | 111 | ||
Series 2004-9 Class 22A1 (Ê) | ||||
4.780% due 11/25/34 | 98 | 98 | ||
Series 2005-2 Class A1 (Ê) | ||||
4.125% due 03/25/35 | 1,668 | 1,652 | ||
Series 2005-3 Class 2A1 | ||||
5.072% due 06/25/35 | 313 | 310 | ||
Bear Stearns Alt-A Trust | ||||
Series 2005-4 Class 23A1 | ||||
5.368% due 05/25/35 | 245 | 242 | ||
Series 2005-7 Class 22A1 | ||||
5.527% due 09/25/35 | 114 | 112 | ||
Bear Stearns Alt-A Trust II | 958 | 956 | ||
Bear Stearns Mortgage Funding Trust (Ê) | ||||
Series 2006-AR2 Class 1A1 | ||||
5.065% due 09/25/36 | 913 | 856 | ||
Series 2006-AR2 Class 2A1 | ||||
5.095% due 10/25/36 | 884 | 853 | ||
Chase Mortgage Finance Corp. | ||||
Series 2003-S8 Class A1 | ||||
4.500% due 09/25/18 | 158 | 154 | ||
Series 2006-S4 Class A3 | ||||
6.000% due 12/25/36 | 266 | 270 | ||
Series 2006-S4 Class A4 | ||||
6.000% due 12/25/36 | 145 | 146 | ||
Series 2007-A1 Class 1A3 | ||||
4.355% due 02/25/37 | 844 | 837 |
| Principal Amount ($) or Shares | Market Value $ | |||
Citigroup Mortgage Loan Trust, Inc. | ||||
Series 2005-11 Class A2A (Ê) | ||||
4.700% due 12/25/35 | 80 | 78 | ||
Series 2006-WFH Class A2 (Ê) | ||||
4.883% due 11/25/36 | 1,000 | 952 | ||
Series 2007-AR8 Class 2A1A | ||||
5.925% due 08/25/37 | 241 | 243 | ||
Citigroup/Deutsche Bank Commercial Mortgage Trust | ||||
Series 2005-CD1 Class A4 | ||||
5.225% due 07/15/44 | 1,000 | 997 | ||
Series 2006-CD3 Class A5 | ||||
5.617% due 10/15/48 | 190 | 194 | ||
Citimortgage Alternative Loan Trust | 156 | 155 | ||
Countrywide Alternative Loan Trust | ||||
Series 2005-32T Class A7 (Ê) | ||||
5.115% due 08/25/35 | 160 | 160 | ||
Series 2005-J8 Class 1A3 | ||||
5.500% due 07/25/35 | 210 | 205 | ||
Series 2005-J13 Class 2A3 | ||||
5.500% due 11/25/35 | 141 | 138 | ||
Series 2006-9T1 Class A7 | ||||
6.000% due 05/25/36 | 114 | 113 | ||
Series 2006-43C Class 1A7 | ||||
6.000% due 02/25/37 | 325 | 322 | ||
Series 2006-J2 Class A3 | ||||
6.000% due 04/25/36 | 170 | 168 | ||
Series 2006-OA1 Class 4A1 (Ê) | ||||
5.055% due 08/25/46 | 684 | 645 | ||
Series 2006-OA1 Class A1 (Ê) | ||||
5.129% due 02/20/47 | 821 | 775 | ||
Series 2007-J2 Class 2A1 | ||||
6.000% due 07/25/37 | 271 | 273 | ||
Series 2007-OA1 Class A1A (Ê) | ||||
6.168% due 04/25/43 | 994 | 954 | ||
Countrywide Home Loan Mortgage Pass Through Trust | ||||
Series 2003-8 Class A2 (Ê) | ||||
5.365% due 05/25/18 | 185 | 184 | ||
Series 2003-52 Class A1 | ||||
4.501% due 02/19/34 | 297 | 296 | ||
Series 2004-16 Class 1A1 (Ê) | ||||
5.265% due 09/25/34 | 189 | 185 | ||
Series 2004-22 Class A3 | ||||
4.801% due 11/25/34 | 243 | 241 |
| Core Bond Fund | 75 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2004-HYB Class 1A1 | ||||
4.726% due 02/20/35 | 423 | 421 | ||
Series 2004-HYB Class A2 | ||||
4.556% due 11/20/34 | 102 | 101 | ||
Series 2005-3 Class 1A2 (Ê) | ||||
5.155% due 04/25/35 | 33 | 31 | ||
Series 2005-HYB Class 2A1 | ||||
4.901% due 08/20/35 | 416 | 410 | ||
Series 2005-HYB Class 3A2A (Ê) | ||||
5.250% due 02/20/36 | 74 | 74 | ||
Series 2006-OA5 Class 2A1 (Ê) | ||||
5.065% due 04/25/46 | 764 | 714 | ||
Series 2007-18 Class 2A1 | ||||
6.500% due 09/25/37 | 296 | 301 | ||
Series 2007-HY1 Class 1A2 | ||||
5.694% due 04/25/37 | 100 | 99 | ||
CS First Boston Mortgage Securities Corp. | ||||
Series 1998-C1 Class A1B | ||||
6.480% due 05/17/40 | 29 | 29 | ||
Series 1998-C2 Class A2 | ||||
6.300% due 11/15/30 | 83 | 84 | ||
Series 2005-9 Class 2A1 | ||||
5.500% due 10/25/35 | 451 | 437 | ||
Deutsche ALT-A Securities, Inc. | 465 | 450 | ||
DLJ Commercial Mortgage Corp. | ||||
Series 1998-CF1 Class A1B | ||||
6.410% due 02/18/31 | 4 | 4 | ||
Series 1999-CG1 Class S | ||||
Interest Only STRIP | ||||
0.817% due 03/10/32 | 3,284 | 34 | ||
Fannie Mae | ||||
5.190% due 2012 | 210 | 214 | ||
6.000% due 2016 | 16 | 16 | ||
5.000% due 2017 | 531 | 533 | ||
5.510% due 2017 (Ê) | 48 | 48 | ||
6.000% due 2017 | 89 | 91 | ||
4.000% due 2018 | 813 | 782 | ||
4.500% due 2018 | 4,008 | 3,948 | ||
5.000% due 2018 | 207 | 207 | ||
4.500% due 2019 | 175 | 171 | ||
5.000% due 2019 | 1,181 | 1,184 | ||
6.000% due 2019 | 492 | 504 | ||
4.500% due 2020 | 395 | 388 | ||
5.000% due 2020 | 1,510 | 1,513 | ||
6.000% due 2020 | 618 | 633 |
| Principal Amount ($) or Shares | Market Value $ | |||
5.000% due 2021 | 1,429 | 1,430 | ||
6.500% due 2024 | 508 | 525 | ||
6.000% due 2026 | 1,149 | 1,170 | ||
6.000% due 2027 | 553 | 563 | ||
6.000% due 2028 | 34 | 35 | ||
5.500% due 2029 | 94 | 95 | ||
6.000% due 2032 | 543 | 555 | ||
7.000% due 2032 | 187 | 193 | ||
3.910% due 2033 (Ê) | 251 | 255 | ||
5.000% due 2033 | 581 | 568 | ||
5.070% due 2033 (Ê) | 130 | 134 | ||
5.500% due 2033 | 2,656 | 2,657 | ||
6.000% due 2033 | 198 | 201 | ||
5.000% due 2034 | 674 | 658 | ||
5.500% due 2034 | 4,189 | 4,190 | ||
5.000% due 2035 | 609 | 595 | ||
5.500% due 2035 | 19,922 | 19,913 | ||
6.000% due 2035 | 160 | 162 | ||
5.000% due 2036 | 45 | 44 | ||
5.500% due 2036 | 923 | 922 | ||
5.630% due 2036 (Ê) | 443 | 446 | ||
6.000% due 2036 | 7,457 | 7,571 | ||
6.500% due 2036 | 113 | 117 | ||
7.000% due 2036 | 25 | 25 | ||
5.000% due 2037 | 6,938 | 6,770 | ||
5.500% due 2037 | 4,055 | 4,051 | ||
5.560% due 2037 (Ê) | 289 | 294 | ||
6.000% due 2037 | 3,047 | 3,095 | ||
6.500% due 2037 | 2,719 | 2,787 | ||
7.000% due 2037 | 3,156 | 3,283 | ||
7.500% due 2037 | 969 | 1,014 | ||
Series 2003-337 Class 1 | ||||
Principal Only STRIP | ||||
Zero coupon due 07/01/33 | 275 | 202 | ||
Series 2003-343 Class 6 | ||||
Interest Only STRIP | ||||
5.000% due 10/01/33 | 270 | 61 | ||
Series 2003-345 Class 18 | ||||
Interest Only STRIP | ||||
4.500% due 12/01/18 | 729 | 105 | ||
Series 2003-345 Class 19 | ||||
Interest Only STRIP | ||||
4.500% due 01/01/19 | 815 | 118 | ||
Series 2004-353 Class 2 | ||||
Interest Only STRIP | ||||
5.000% due 08/01/34 | 572 | 143 | ||
Series 2004-356 Class 35 | ||||
Interest Only STRIP | ||||
4.500% due 03/01/20 | 141 | 21 |
| 76 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2004-356 Class 36 | ||||
Interest Only STRIP | ||||
4.500% due 03/01/20 | 240 | 37 | ||
Series 2005-365 Class 12 | ||||
Interest Only STRIP | ||||
5.500% due 12/01/35 | 1,062 | 232 | ||
Series 2006-369 Class 8 | ||||
Interest Only STRIP | ||||
5.500% due 04/01/36 | 216 | 50 | ||
Series 2006-372 Class 2 | ||||
Interest Only STRIP | ||||
6.000% due 08/01/36 | 557 | 122 | ||
15 Year TBA (Ï) | ||||
4.500% | 340 | 335 | ||
5.000% | 1,210 | 1,211 | ||
5.500% | 1,000 | 1,013 | ||
30 Year TBA (Ï) | ||||
4.500% | 530 | 502 | ||
5.000% | 3,175 | 3,092 | ||
6.000% | 4,810 | 4,884 | ||
6.500% | 1,695 | 1,742 | ||
7.000% | 9,000 | 9,360 | ||
Fannie Mae REMICS | ||||
Series 1992-10 Class ZD | ||||
8.000% due 11/25/21 | 33 | 33 | ||
Series 1999-56 Class Z | ||||
7.000% due 12/18/29 | 103 | 105 | ||
Series 2003-32 Class FH (Ê) | ||||
5.265% due 11/25/22 | 323 | 323 | ||
Series 2003-35 Class FY (Ê) | ||||
5.265% due 05/25/18 | 415 | 418 | ||
Series 2003-78 Class FI (Ê) | ||||
5.265% due 01/25/33 | 317 | 317 | ||
Series 2004-21 Class FL (Ê) | ||||
5.215% due 11/25/32 | 158 | 158 | ||
Series 2005-36 Class AI | ||||
Interest Only STRIP | ||||
5.500% due 10/25/26 | 257 | 14 | ||
Series 2005-79 Class FC (Ê) | ||||
5.165% due 02/25/22 | 150 | 149 | ||
Series 2006-48 Class LG | ||||
Principal Only STRIP | ||||
Zero coupon due 06/25/36 | 70 | 39 | ||
Fannie Mae Whole Loan | 40 | 42 | ||
Federal Home Loan Mortgage | 35 | 35 |
| Principal Amount ($) or Shares | Market Value $ | |||
First Horizon Alternative Mortgage Securities | ||||
Series 2004-AA3 Class A1 (Ê) | ||||
5.302% due 09/25/34 | 53 | 53 | ||
Series 2006-AA5 Class A2 (Ê) | ||||
6.522% due 09/25/36 | 150 | 153 | ||
Series 2006-FA3 Class A6 | ||||
6.000% due 07/25/36 | 236 | 235 | ||
First Horizon Asset Securities, Inc. (Ê) | ||||
Series 2004-AR6 Class 2A1 | ||||
4.750% due 12/25/34 | 46 | 45 | ||
Series 2005-AR5 Class 3A1 | ||||
5.535% due 10/25/35 | 114 | 113 | ||
Freddie Mac | ||||
6.000% due 2016 | 26 | 26 | ||
5.000% due 2018 | 649 | 651 | ||
4.000% due 2019 | 1,648 | 1,583 | ||
5.000% due 2019 | 739 | 741 | ||
5.000% due 2020 | 1,346 | 1,348 | ||
5.500% due 2020 | 789 | 799 | ||
7.360% due 2030 (Ê) | 1 | 2 | ||
5.000% due 2033 | 206 | 201 | ||
6.890% due 2034 (Ê) | 102 | 103 | ||
6.000% due 2035 | 146 | 147 | ||
5.870% due 2036 (Ê) | 119 | 120 | ||
5.940% due 2036 (Ê) | 233 | 236 | ||
5.970% due 2036 (Ê) | 139 | 141 | ||
5.540% due 2037 (Ê) | 427 | 433 | ||
5.570% due 2037 (Ê) | 183 | 185 | ||
5.720% due 2037 (Ê) | 712 | 724 | ||
5.760% due 2037 (Ê) | 250 | 255 | ||
5.810% due 2037 (Ê) | 204 | 207 | ||
5.830% due 2037 (Ê) | 189 | 192 | ||
5.870% due 2037 (Ê) | 89 | 90 | ||
5.890% due 2037 (Ê) | 69 | 71 | ||
6.000% due 2037 | 1,979 | 2,009 | ||
30 Year TBA (Ï) | ||||
5.000% | 1,485 | 1,449 | ||
5.500% | 2,520 | 2,514 | ||
Freddie Mac REMICS | ||||
Series 2000-226 Class F (Ê) | ||||
5.478% due 11/15/30 | 16 | 16 | ||
Series 2003-256 Class FJ (Ê) | ||||
5.428% due 02/15/33 | 142 | 143 | ||
Series 2003-258 Class IG | ||||
Interest Only STRIP | ||||
4.500% due 10/15/16 | 111 | 9 | ||
Series 2003-262 Class AB | ||||
2.900% due 11/15/14 | 239 | 235 |
| Core Bond Fund | 77 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2004-276 Class IP | ||||
Interest Only STRIP | ||||
5.500% due 07/15/23 | 152 | 3 | ||
Series 2004-281 Class DF (Ê) | ||||
5.478% due 06/15/23 | 121 | 122 | ||
Series 2005-292 Class IG | ||||
Interest Only STRIP | ||||
5.000% due 04/15/23 | 169 | 25 | ||
Series 2005-294 Class FA (Ê) | ||||
5.198% due 03/15/20 | 233 | 233 | ||
Series 2005-299 Class KF (Ê) | ||||
5.428% due 06/15/35 | 76 | 75 | ||
Series 2005-301 Class IM | ||||
Interest Only STRIP | ||||
5.500% due 01/15/31 | 167 | 17 | ||
Series 2006-313 Class FP (Ê) | ||||
Zero coupon due 04/15/36 | 165 | 168 | ||
Series 2006-317 Class XI (Ê) | ||||
Principal Only STRIP | ||||
Zero coupon due 10/15/35 | 260 | 3 | ||
Series 2006-323 Class PA | ||||
6.000% due 03/15/26 | 281 | 285 | ||
Series 2007-330 Class GL (Ê) | ||||
6.514% due 04/15/37 | 87 | 95 | ||
Series 2007-333 Class AF (Ê) | ||||
5.178% due 10/15/20 | 2,000 | 1,991 | ||
Series 2007-333 Class BF (Ê) | ||||
5.178% due 07/15/19 | 363 | 361 | ||
Series 2007-333 Class FT (Ê) | ||||
5.178% due 08/15/19 | 1,449 | 1,442 | ||
Series 2007-334 Class FA (Ê) | ||||
5.258% due 02/15/19 | 1,396 | 1,388 | ||
Ginnie Mae I | ||||
6.000% due 2029 | 13 | 13 | ||
6.000% due 2036 | 473 | 485 | ||
6.000% due 2037 | 506 | 518 | ||
30 Year TBA (Ï) | ||||
5.500% | 1,650 | 1,662 | ||
Ginnie Mae II (Ê) | ||||
6.380% due 2026 | 200 | 202 | ||
5.630% due 2027 | 12 | 13 | ||
5.750% due 2032 | 87 | 88 | ||
GMAC Commercial Mortgage Securities, Inc. Series 1999-C2 Class A2 | 189 | 194 | ||
GMAC Mortgage Corp. Loan Trust | ||||
Series 2004-JR1 Class A6 (Ê) | ||||
5.315% due 12/25/33 | 96 | 95 |
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2007-HE3 Class 1A1 | ||||
7.000% due 09/25/37 | 98 | 98 | ||
Government National Mortgage Association (Ê) | ||||
Series 1999-40 Class FE | ||||
5.578% due 11/16/29 | 117 | 118 | ||
Series 2000-29 Class F | ||||
5.449% due 09/20/30 | 22 | 22 | ||
Greenwich Capital Commercial Funding Corp. | ||||
Series 2003-C2 Class A2 | ||||
4.022% due 01/05/36 | 200 | 198 | ||
Series 2004-GG1 Class A7 | ||||
5.317% due 06/10/36 | 465 | 473 | ||
Series 2007-GG9 Class A4 | ||||
5.444% due 03/10/39 | 215 | 216 | ||
GS Mortgage Securities Corp. II | ||||
Series 2006-FL8 Class A1 (Ê)(Þ) | ||||
5.352% due 06/06/20 | 1 | 1 | ||
Series 2006-GG6 Class A4 | ||||
5.553% due 04/10/38 | 135 | 137 | ||
Series 2006-GG8 Class AAB | ||||
5.535% due 11/10/39 | 200 | 202 | ||
Series 2007-GG1 Class A4 | ||||
5.799% due 08/10/45 | 645 | 667 | ||
GSR Mortgage Loan Trust | 261 | 252 | ||
Harborview Mortgage Loan Trust | ||||
Series 2005-4 Class 3A1 | ||||
5.148% due 07/19/35 | 189 | 187 | ||
Series 2005-14 Class 3A1A | ||||
5.300% due 12/19/35 | 111 | 111 | ||
Series 2005-16 Class 3A1A (Ê) | ||||
5.215% due 01/19/36 | 449 | 428 | ||
Indymac Index Mortgage Loan Trust | ||||
Series 2005-AR1 Class A1 | ||||
5.443% due 09/25/35 | 684 | 671 | ||
Series 2006-AR2 Class A2 (Ê) | ||||
4.945% due 11/25/36 | 118 | 117 | ||
JP Morgan Chase Commercial Mortgage Securities Corp. | ||||
Series 2001-CIB Class A2 | ||||
6.244% due 04/15/35 | 155 | 156 | ||
Series 2004-LN2 Class A1 | ||||
4.475% due 07/15/41 | 340 | 338 | ||
Series 2005-LDP Class A3A1 | ||||
4.871% due 10/15/42 | 210 | 208 |
| 78 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2005-LDP Class A4 | ||||
4.918% due 10/15/42 | 325 | 315 | ||
5.179% due 12/15/44 | 390 | 388 | ||
Series 2006-CB1 Class A4 | ||||
5.552% due 05/12/45 | 220 | 223 | ||
Series 2006-LDP Class A3 | ||||
5.336% due 05/15/47 | 305 | 304 | ||
Series 2006-LDP Class A3B | ||||
5.447% due 05/15/45 | 250 | 251 | ||
Series 2006-LDP Class A4 | ||||
5.875% due 04/15/45 | 650 | 676 | ||
5.399% due 05/15/45 | 290 | 291 | ||
Series 2007-LDP Class A3 | ||||
5.420% due 01/15/49 | 275 | 275 | ||
JP Morgan Mortgage Trust (Ê) | ||||
Series 2005-A1 Class 6T1 | ||||
5.405% due 02/25/35 | 137 | 134 | ||
Series 2007-A1 Class 2A2 | ||||
4.755% due 07/25/35 | 872 | 866 | ||
LB-UBS Commercial Mortgage Trust | ||||
Series 2004-C4 Class A3 | ||||
4.976% due 06/15/29 | 155 | 158 | ||
Series 2006-C1 Class A4 | ||||
5.156% due 02/15/31 | 1,000 | 989 | ||
Series 2006-C4 Class A4 | ||||
5.883% due 06/15/38 | 105 | 110 | ||
Series 2007-C6 Class A4 | ||||
5.858% due 07/15/40 | 270 | 280 | ||
Lehman Mortgage Trust | 629 | 627 | ||
Lehman XS Trust (Ê) | ||||
Series 2005-5N Class 3A1A | ||||
5.165% due 11/25/35 | 503 | 477 | ||
Series 2006-16N Class A4A | ||||
5.055% due 11/25/46 | 829 | 787 | ||
Mastr Adjustable Rate Mortgages Trust (Ê) | ||||
Series 2004-13 Class 3A4 | ||||
3.787% due 11/21/34 | 198 | 196 | ||
Series 2006-OA2 Class 4A1A | ||||
5.713% due 12/25/46 | 836 | 813 | ||
MASTR Alternative Loans Trust | ||||
Series 2003-4 Class B1 | ||||
5.677% due 06/25/33 | 195 | 192 | ||
Series 2004-10 Class 5A6 | ||||
5.750% due 09/25/34 | 170 | 168 | ||
MASTR Asset Securitization Trust (Ê) | ||||
Series 2003-7 Class 4A35 | ||||
5.265% due 09/25/33 | 237 | 235 |
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2004-4 Class 2A2 | ||||
5.315% due 04/25/34 | 88 | 88 | ||
Mellon Residential Funding Corp. (Ê) | 197 | 194 | ||
Merrill Lynch Floating Trust (Ê)(Þ) | 842 | 849 | ||
Merrill Lynch Mortgage Investors, Inc. (Ê) | 105 | 101 | ||
MLCC Mortgage Investors, Inc. (Ê) | ||||
Series 2004-HB1 Class A2 | ||||
5.750% due 04/25/29 | 42 | 41 | ||
Series 2005-3 Class 5A | ||||
5.115% due 11/25/35 | 61 | 59 | ||
Morgan Stanley Capital I | ||||
Series 2005-IQ1 Class AAB | ||||
5.178% due 09/15/42 | 415 | 415 | ||
Series 2006-HQ1 Class A4 | ||||
5.328% due 11/12/41 | 130 | 130 | ||
Series 2006-HQ8 Class A4 | ||||
5.388% due 03/12/44 | 310 | 313 | ||
Series 2006-HQ9 Class A4 | ||||
5.731% due 07/12/44 | 200 | 206 | ||
MortgageIT Trust (Ê) | 499 | 472 | ||
Prime Mortgage Trust (Ê) | 41 | 40 | ||
Residential Accredit Loans, Inc. | ||||
Series 2004-QS5 Class A6 (Ê) | ||||
5.465% due 04/25/34 | 61 | 59 | ||
Series 2004-QS8 Class A4 (Ê) | ||||
5.265% due 06/25/34 | 308 | 302 | ||
Series 2005-QA8 Class NB3 | ||||
5.479% due 07/25/35 | 255 | 252 | ||
Series 2005-QO5 Class A1 (Ê) | ||||
5.863% due 01/25/46 | 592 | 566 | ||
Series 2006-QS6 Class 1A13 | ||||
6.000% due 06/25/36 | 395 | 394 | ||
Series 2007-QH9 Class A1 | ||||
6.550% due 11/25/37 | 995 | 985 | ||
Residential Asset Securities Corp. (Ê) | 56 | 55 |
| Core Bond Fund | 79 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | |||
Residential Asset Securitization Trust | ||||
Series 2003-A15 Class 1A2 (Ê) | ||||
5.315% due 02/25/34 | 344 | 338 | ||
Series 2007-A5 Class 2A3 | ||||
6.000% due 05/25/37 | 136 | 135 | ||
Residential Funding Mortgage Securities I | ||||
Series 2003-S5 Class 1A2 (Ê) | ||||
5.315% due 11/25/18 | 183 | 183 | ||
Series 2003-S14 Class A5 (Ê) | ||||
5.265% due 07/25/18 | 196 | 195 | ||
Series 2003-S20 Class 1A7 (Ê) | ||||
5.365% due 12/25/33 | 71 | 71 | ||
Series 2005-SA4 Class 2A1 | ||||
5.207% due 09/25/35 | 735 | 730 | ||
Series 2006-SA4 Class 2A1 | ||||
6.123% due 11/25/36 | 491 | 492 | ||
Sequoia Mortgage Trust (Ê) | 71 | 70 | ||
Small Business Administration Participation Certificates | 879 | 863 | ||
Structured Adjustable Rate Mortgage Loan Trust | ||||
Series 2004-5 Class 3A1 | ||||
4.380% due 05/25/34 | 156 | 154 | ||
Series 2004-12 Class 3A2 | ||||
5.250% due 09/25/34 | 70 | 70 | ||
Series 2004-16 Class 3A1 | ||||
5.450% due 11/25/34 | 255 | 253 | ||
Structured Asset Mortgage Investments, Inc. (Ê) | ||||
Series 2005-AR5 Class A3 | ||||
5.215% due 07/19/35 | 184 | 179 | ||
Series 2006-AR2 Class A1 | ||||
5.095% due 02/25/36 | 606 | 573 | ||
Series 2006-AR8 Class A1A | ||||
5.065% due 10/25/36 | 845 | 808 | ||
Series 2007-AR6 Class A1 | ||||
6.363% due 11/25/37 | 996 | 970 | ||
Structured Asset Securities Corp. | 467 | 465 | ||
Thornburg Mortgage Securities Trust (Ê) | ||||
Series 2003-2 Class A1 | ||||
5.205% due 04/25/43 | 120 | 120 |
| Principal Amount ($) or Shares | Market Value $ | |||
Series 2006-5 Class A1 | ||||
4.985% due 09/25/46 | 782 | 765 | ||
Series 2006-6 Class A1 | ||||
4.975% due 12/25/36 | 156 | 153 | ||
Wachovia Bank Commercial Mortgage Trust Series 2005-C21 Class A4 | 1,000 | 990 | ||
Washington Mutual Alternative Mortgage Pass-Through Certificates | ||||
Series 2005-4 Class CB11 | ||||
5.500% due 06/25/35 | 90 | 86 | ||
Series 2006-AR8 Class 2A (Ê) | ||||
5.638% due 10/25/46 | 801 | 777 | ||
Series 2006-AR9 Class 2A (Ê) | ||||
5.628% due 11/25/46 | 879 | 848 | ||
Series 2007-OA1 Class 2A (Ê) | ||||
5.508% due 12/25/46 | 760 | 703 | ||
Washington Mutual Mortgage Pass Through Certificates | ||||
Series 2003-S9 Class A2 (Ê) | ||||
5.415% due 10/25/33 | 344 | 342 | ||
Series 2004-AR3 Class A2 | ||||
4.243% due 06/25/34 | 169 | 168 | ||
Series 2005-AR1 Class 1A1 | ||||
4.835% due 10/25/35 | 292 | 290 | ||
Series 2005-AR1 Class A1A1 (Ê) | ||||
5.155% due 10/25/45 | 38 | 36 | ||
5.135% due 12/25/45 | 477 | 452 | ||
Series 2005-AR6 Class B3 (Ê) | ||||
5.525% due 04/25/45 | 210 | 194 | ||
Series 2006-AR1 Class 3A1A (Ê) | ||||
5.708% due 09/25/46 | 793 | 770 | ||
Series 2006-AR2 Class 1A1 | ||||
5.313% due 03/25/37 | 805 | 806 | ||
Series 2007-HY3 Class 4A1 | ||||
5.349% due 03/25/37 | 904 | 900 | ||
Series 2007-HY3 Class 4B1 | ||||
5.350% due 03/25/37 | 125 | 118 | ||
Series 2007-HY4 Class 1A1 (Ê) | ||||
5.554% due 04/25/37 | 165 | 163 | ||
Wells Fargo Alternative Loan Trust | 937 | 939 | ||
Wells Fargo Mortgage Backed Securities Trust | ||||
Series 2005-17 Class 2A1 | ||||
5.500% due 01/25/36 | 658 | 644 | ||
Series 2005-AR6 Class A1 (Ê) | ||||
5.039% due 04/25/35 | 758 | 722 |
| 80 | Core Bond Fund |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | ||||
Series 2006-2 Class 2A3 | |||||
5.500% due 03/25/36 | 444 | 446 | |||
Series 2006-AR1 Class AIO | |||||
Interest Only STRIP | |||||
0.450% due 10/25/36 | 9,532 | 99 | |||
Series 2006-AR2 Class 2A1 | |||||
4.950% due 03/25/36 | 321 | 317 | |||
Series 2007-8 Class 1A16 | |||||
6.000% due 07/25/37 | 358 | 357 | |||
Series 2007-10 Class 2A5 | |||||
6.250% due 07/25/37 | 181 | 184 | |||
| 188,516 | |||||
Municipal Bonds - 0.4% | |||||
New York City Municipal Water Finance Authority Revenue Bonds | 1,300 | 1,303 | |||
Non-US Bonds - 0.3% | |||||
Argentina Bocon | ARS | 1,078 | 449 | ||
Bombardier, Inc. (Å) | EUR | 125 | 183 | ||
Federative Republic of Brazil | |||||
12.570% due 01/05/22 | BRL | 300 | 189 | ||
10.250% due 01/10/28 (Ñ) | BRL | 140 | 76 | ||
Ineos Group Holdings PLC | EUR | 125 | 153 | ||
| 1,050 | |||||
United States Government Agencies - 3.0% | |||||
Fannie Mae (Ñ) | 2,200 | 2,220 | |||
3.875% due 02/15/10 | 510 | 513 | |||
4.750% due 04/20/10 | 1,400 | 1,436 | |||
4.125% due 05/12/10 | 1,500 | 1,518 | |||
5.050% due 02/07/11 | 1,200 | 1,249 | |||
Federal Home Loan Bank | 295 | 311 | |||
Federal Home Loan Bank Discount Notes | |||||
5.310% due 12/28/12 (Ñ) | 1,000 | 1,060 | |||
Financing Corp. | |||||
Principal Only STRIP | 80 | 55 | |||
| Principal Amount ($) or Shares | Market Value $ | |||
Series 1P | ||||
Zero coupon due 05/11/18 | 95 | 59 | ||
Series 3P | ||||
Zero coupon due 11/30/17 | 170 | 108 | ||
Series 5P | ||||
Zero coupon due 02/08/18 | 65 | 41 | ||
Series 8P | ||||
Zero coupon due 08/03/18 | 605 | 371 | ||
Series 9P | ||||
Zero coupon due 10/06/17 | 310 | 200 | ||
Series 12P | ||||
Zero coupon due 12/06/18 | 245 | 147 | ||
Series 13 | ||||
Zero coupon due 12/27/16 | 275 | 184 | ||
Series 13P | ||||
Zero coupon due 12/27/18 | 1,130 | 678 | ||
Series 16P | ||||
Zero coupon due 04/05/19 | 380 | 224 | ||
Series 19 | ||||
Zero coupon due 06/06/16 | 230 | 158 | ||
| 10,532 | ||||
United States Government Treasuries - 2.9% | ||||
United States Treasury Principal (Ñ) | ||||
Principal Only STRIP | ||||
Zero coupon due 11/15/21 | 445 | 235 | ||
Zero coupon due 08/15/25 | 300 | 132 | ||
Zero coupon due 08/15/26 | 300 | 127 | ||
United States Treasury Inflation Indexed Bonds | ||||
0.875% due 04/15/10 | 1,331 | 1,326 | ||
2.375% due 04/15/11 | 212 | 221 | ||
3.375% due 01/15/12 (Ñ) | 982 | 1,072 | ||
2.000% due 04/15/12 | 103 | 107 | ||
2.000% due 01/15/14 (Ñ) | 113 | 117 | ||
2.000% due 07/15/14 (Ñ) | 1,518 | 1,569 | ||
2.625% due 07/15/17 | 101 | 108 | ||
2.375% due 01/15/25 (Ñ) | 120 | 126 | ||
2.000% due 01/15/26 (Ñ) | 316 | 314 | ||
2.375% due 01/15/27 (Ñ) | 207 | 219 | ||
United States Treasury Notes (Ñ) | ||||
4.000% due 08/31/09 | 900 | 913 | ||
4.750% due 05/31/12 | 600 | 633 | ||
4.250% due 08/15/15 | 345 | 354 | ||
6.000% due 02/15/26 | 2,310 | 2,734 | ||
| 10,307 | ||||
| Total Long-Term Investments | ||||
(cost $315,146) | 313,881 | |||
| Core Bond Fund | 81 |
Table of Contents
Russell Investment Funds
Core Bond Fund
Schedule of Investments, continued — December 31, 2007
Amounts in thousands (except share amounts)
| Principal Amount ($) or Shares | Market Value $ | ||||
| Preferred Stocks - 0.3% | |||||
Financial Services - 0.3% | |||||
DG Funding Trust (Æ)(Å) | 49 | 517 | |||
Fannie Mae (Æ) | 14,000 | 360 | |||
| Total Preferred Stocks | |||||
(cost $866) | 877 | ||||
Notional | |||||
Options Purchased - 0.4% | |||||
(Number of Contracts) | |||||
Eurodollar Futures | |||||
Mar 2008 91.75 Put (241) | USD | 603 | 2 | ||
Mar 2008 92.00 Put (43) | USD | 108 | — | ||
Mar 2008 92.50 Put (58) | USD | 145 | — | ||
Mar 2008 92.75 Put (53) | USD | 133 | — | ||
Mar 2008 93.00 Put (68) | USD | 170 | — | ||
Jun 2008 92.75 Put (40) | USD | 100 | — | ||
Swaptions (Fund Pays/Fund Receives) | |||||
USD Three Month LIBOR/USD | |||||
Feb 2008 0.00 Call (1) | 5,000 | 38 | |||
USD Three Month LIBOR/USD | |||||
Feb 2008 0.00 Call (1) | 6,000 | 140 | |||
USD Three Month LIBOR/USD | |||||
Mar 2008 0.00 Call (2) | 15,000 | 302 | |||
USD Three Month LIBOR/USD | |||||
Sep 2008 0.00 Call (3) | 13,900 | 288 | |||
USD Three Month LIBOR/USD | |||||
Dec 2008 0.00 Call (1) | 6,200 | 123 | |||
USD Three Month LIBOR/USD | |||||
Dec 2008 0.00 Call (1) | 15,100 | 356 | |||
USD Three Month LIBOR/USD | |||||
Feb 2009 0.00 Call (1) | 5,000 | 130 | |||
| Total Options Purchased | |||||
(cost $305) | 1,379 | ||||
| Principal Amount ($) or Shares | Market Value $ | |||
Short-Term Investments - 15.3% | ||||
Abbey National Treasury Services PLC (Ê) | 500 | 500 | ||
American Express Bank FSB (Ê) | 300 | 299 | ||
AMFM, Inc. | 50 | 52 | ||
Amstel Funding Corp. | 510 | 509 | ||
Atlantic Asset Securitization | 510 | 509 | ||
Barclays Bank PLC | 600 | 600 | ||
Chariot Funding, LLC | 510 | 509 | ||
Citigroup Funding, Inc. (Ê) | 100 | 99 | ||
Citigroup Global Markets Holdings, Inc. (Ê) | 400 | 400 | ||
Citigroup, Inc. | 560 | 559 | ||
Clear Channel Communications, Inc. | 125 | 125 | ||
Clipper Receivables Co. | 510 | 509 | ||
CSC Holdings, Inc. (Ñ) | 125 | 125 | ||
Dexia Credit SA | 1,100 | 1,099 | ||
Falcon Asset Securitization Co. LLC | 510 | 509 | ||
Federal Home Loan Bank D (ç)(ž) | 60 | 60 | ||
Federal Home Loan Bank Discount Notes | ||||