released a new micro-cap fund to intermediaries on Tuesday. The addition of the fund, Touchstone Micro Cap Growth, increases the number of offered equity funds to seven and total funds to 17.
The fund is subadvised by Bjurman, Barry & Associates
(Bjurman), a Los Angeles-based manager and fund firm, who also subadvises Touchstone's Small Cap Growth fund.
O. Thomas Barry
, chief investment officer of Bjurman, will co-manage the new Touchstone fund with Stephen Shipman
, executive vice president and director of research at Bjurman. They will invest at least 80 percent of the portfolio in companies with market capitalizations between $30 million and $300 million.
The development of the fund has been underway for more than six months, said Jim Grifo
, president of Touchstone. He attributed the creation of the new fund to Touchstone's existing relationship with Bjurman and extra investing "capacity" at Bjurman. Bjurman also offer their own micro-cap, small-cap and mid-cap growth funds; their micro-cap fund is currently closed to new investors.
Bjurman will apply the same portfolio construction methodology to the Touchstone fund, although the exact composition may differ due to total portfolio size, said Grifo. The target size of the new fund is $450 million to $500 million of assets under management.
The reaction to the new fund has been positive, said Grifo. Touchstone representatives have visited brokerages including Wachovia, Prudential, AG Edwards, and Morgan Stanley. "We have an internal desk of ten that support 15 external wholesalers…we're not doing any special advertising or promotion, but going through [the] normal channels," said Grifo.
The new Touchstone Micro Cap Growth fund requires a minimum investment of $10,000 in regular accounts and $250 in retirement accounts.
Since Touchstone's current fund lineup still leaves a few Morningstar style boxes empty, Grifo said the firm will continue to look for new fund opportunities in where its lineup is lacking, in adoptions or acquisitions, and even in small- or micro-cap.
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