NEW YORK - The growth of the SMA marketplace hasn't only caused financial intermediaries and investors to adapt to a new managed account model. Investment management firms are finding they have to carve out their own path to SMA success.
"The move into separate accounts is transforming AIM," said Mark McMeans, president of AIM Private Asset Management, the managed account unit of AIM Investments of Houston, speaking at a conference on separately managed accounts here, sponsored by the Money Management Institute. "We think of separate accounts being added to AIM as additive to clients and advisors." McMeans said. AIM found that 75% of the representatives who have done SMA business with the firm also utilize AIM's mutual funds.
In the past, some have taken a less than favorable view of the SMA business. But now, that view has changed. "It's seen as a badge of honor; a stamp of excellence," McMeans said.
The previously almost exclusively mutual fund management firm chose to evolve and has recently taken on a new, broader, institutional focus. That evolution includes making a strong commitment to building its SMA business from scratch as opposed to acquiring outside managers. "We didn't want to acquire another asset manager to muddy the waters," McMeans said. Acquisitions could have left financial intermediaries wondering how the acquired firm would manage assets versus how AIM manages money, he said.
AIM's transformation also included hiring 35 employees solely dedicated to the unit and changing its corporate moniker from AIM Management to AIM Investments. The firm has recently even relinquished its old "Invest with discipline" tagline in favor of adopting the fresh new tagline "Your goals. Our solutions."
But there's a drawback to choosing organic growth. The economics are tough and there's a need to rapidly gain scale, McMeans said. "Large companies will dominate the future of this business," he said.
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