Snyder Capital Management Inc., San Francisco, now with $490 million from 46 tax-exempt clients, plans to stop taking new clients when it reaches $600 million, said Walter Niemasik, vice president.
The small- and midcapitalization value stock manager plans to keep the moratorium for at least one year to ensure it can maintain its above-market performance.
For the 12 months ended Sept. 30, Snyder returned 14.79%. In the same period, the Russell 2500 stock index returned 2.88%, the Russell 2000, 2.64% and the Standard & Poor's 500 Stock Index, 3.63%.
"We would have to continue to do well (in performance) and feel confident we could run more money before we would lift" the moratorium, he said. "We have to be satisfied our staff and systems can effectively manage the money we have and find good stock ideas."
"We don't want to increase staff size," Mr. Niemasik said. Snyder's staff now totals nine - five in research or portfolio management, two in trading and two in support, he said.
"We're in a good 10 searches and we have a pretty good chance by the end of the year or in the first quarter" of next year of reaching the $600 million goal, he said.
Once the goal is reached, Snyder, which was founded in 1985, plans to take on new clients only to replace departing clients, or to allow existing clients to add to their assignment.
He said Snyder has no plans to develop a new investment strategy.