FTSE Russell Research Hub

FTSE Russell’s research highlights a strategic focus on evolving classification systems, notably the Green Revenues Classification System (GRCS), which facilitates the construction of thematic indices by identifying green economic activity across 21,000 companies. These thematic exposures, such as Climate Adaptation and Biodiversity, naturally tilt portfolios toward Industrials and Utilities while maintaining a structural underweight to the technology and financial sectors dominant in global benchmarks. This transition to sustainable investment is further catalyzed by geopolitical shifts, where energy market disruptions are expected to accelerate the adoption of cost-competitive clean technologies and infrastructure, including grid and EV value chains. Beyond sustainability, the institution observes a significant surge in private market interest, with two-thirds of Millennials already holding these assets and a growing demand for advisor-led recommendations. To support this trend, the research underscores the necessity of standardized indices to provide the transparency and performance benchmarking required for private markets to reach mainstream status. Analysis of private equity performance reveals that while traditional buyouts offer lower volatility due to illiquidity, new liquid investment vehicles like the FTSE DSC PE/VC Index may exhibit greater correlation with public large-cap equities. Together, these insights reflect a broader research direction centered on providing the frameworks and data transparency needed to navigate both the energy transition and the integration of private assets into diversified portfolios.