Touchstone Advisors of Cincinnati is asking shareholders of the Touchstone Emerging Growth Fund to approve the firing of David L. Babson & Company as the fund's sub-adviser, according to a preliminary proxy filed Feb. 26 with the Securities and Exchange Commission.
Touchstone is seeking to replace Babson with TCW Investment Management Company of Los Angeles. Babson co-advises the fund with Westfield Capital Management of Boston.
Babson will be replaced May 1 in an effort to improve investment performance, according to the proxy. The fund had posted strong returns in recent years, but they have recently declined, according to Morningstar of Chicago. In 1999, the fund posted a 45.9 percent return and last year, a 25.9 percent return. But the fund lost 1.1 percent in January, according to Morningstar.
Under the new arrangement, management fees will remain the same, with TCW earning 0.50 percent of the average daily net assets of the fund, according to the proxy. Last fiscal year, Babson earned $18,342.00 in advisory fees.
At the end of last year, TCW had approximately $78.7 billion in assets under management, according to the proxy.