Analytic Investors, the quantitative money manager in Los Angeles with roughly $1 billion in assets under management, is renewing efforts to expand sales of its retail mutual funds.
Analytic plans to increase its marketing staff and will become part of the 46-fund United Asset Management, or UAM, fund family, according to a company official and recent SEC filings. Analytic, currently a subsidiary of UAM of Boston, hopes the moves will help it increase sales of two of its high-performing funds, the Analytic Enhanced Equity and Defensive Equity funds. Although Analytic is a subsidiary of UAM, its funds have been separately marketed and distributed. Becoming part of the UAM family means Analytic funds will be marketed and distributed along with UAM funds.
"We feel that with a real strong push, these funds will garner some assets," said Marie Arlt, chief operating officer for Analytic.
Analytic's affiliation with the UAM fund family, which has about $3.5 billion in assets under management, is the second step the company has taken to increase its distribution in the past 12 months.
Last March, Analytic, which historically had been a no-load firm, disclosed plans to merge its funds with Pilgrim Baxter & Associates. Part of the impetus for the plan was to increase Analytic's retail fund distribution by offering its funds with a sales charge through financial intermediaries as part of a new Pilgrim Baxter distribution effort. Analytic merged its funds into Pilgrim Baxter in July but the new distribution effort never got started.
In November, Pilgrim Baxter dropped plans to offer funds with a sales charge. On Feb. 12, Analytic filed a preliminary proxy statement with the SEC asking its shareholders at a meeting scheduled for March 31 to make Analytic's four funds - Enhanced Equity, Defensive Equity, Master Fixed Income and Short-Term Government - part of the UAM funds. The funds have combined assets of approximately $100 million. Prior to the affiliation with Pilgrim Baxter, Analytic had sold the funds on its own and not as part of the UAM fund family.
If shareholders approve proposed changes, the four Analytic funds will drop sales charges and Rule 12b-1 fees, according to the SEC filing. Analytic also plans to add a senior level marketing person to its own operation. The firm now employs 18.
Analytic further plans to add a web site for its funds and other products. In addition, by virtue of being a part of the UAM funds, Analytic's products will be offered through mutual fund supermarkets.
Sales through supermarkets are particularly driven by good performance. Enhanced Equity carries a Morningstar rating of five stars but has only $36 million in assets. Defensive Equity, a four-star fund with about $58 million in assets, has received favorable coverage in the personal finance press. Both funds invest in large-capitalization stocks. Morningstar has characterized their investing style as a blend of value and growth.