HOUSTON - AIM Advisors Inc., a high-flying aggressive growth manager during the 1990s, is taking a more grounded approach to money management.
The Houston-based money manager, hit harder than most in the industry the last 21/2 years, has been making strides to position itself as something more than an aggressive growth equity shop. AIM is owned by AMVESCAP PLC, London.
The perception of AIM as a growth manager isn't wholly accurate, said Charles Brady, AMVESCAP executive chairman in Atlanta. In an Aug. 2 earnings conference call, Mr. Brady noted 46% of the firm's assets are in core equities, while 33% are in pure growth, and 8% in value equities. Five years ago, AIM had 53% of its assets in growth, 36% in core, and nothing in value, said Ivy McLemore, AIM spokesman.
The numbers show the firm has been building up its asset base in value and growth-at-a-reasonable-price equities.
Despite the evolution toward a broader portfolio line, AIM has not been able to stem the erosion of assets. Mutual fund assets have plummeted 27% to $65.9 billion since June 30, 2001, according to Financial Research Corp., Boston. Overall, AIM's assets dropped to $158.7 billion, a decrease of 11.7% since Dec. 31, and 17.7% since June 30, 2001.
DC assets down
While overall institutional assets grew to $68 billion as of March 31, (the latest data available) up 19% from a year earlier, money from defined contribution plans has dropped.
Mr. McLemore attributed the overall growth to a rise in institutional money market assets, noting the firm has very little in institutional equity separate accounts.
Looking specifically at defined contribution assets, however, there was a drop of 9% from year-end 2000 to June 30, 2002, he said. AIM had $11 billion in defined contribution assets at Dec. 31, 2000, but $10 billion at the end of June.
In order to better align portfolio managers with their area of expertise, AIM changed lead managers in two of its largest mutual funds, and did some fine-tuning to its portfolio management teams.
In January, Larry Sachnowitz took over management of the $3 billion AIM Weingarten Fund, replacing Jon Schoolar, who will assume other responsibilities at AIM. Mr. Sachnowitz ran the $3.6 billion AIM Charter Fund. AIM veteran Ronald Sloan, who also runs the AIM Mid Cap Equity Fund, takes over the Charter Fund.
Observers say the firm is moving in the right direction in building out its portfolio line. Michael Kim, analyst at Putnam Lovell Securities Inc., New York, said AIM is faced with the same problems as Janus Corp., Denver, in trying to diversify its assets.
"In the last couple of years they have had to reorganize funds in a more defensive or core fashion in response to equity market weakness," said Mr. Kim.
Changes make sense
Bridget Hughes, analyst at Morningstar Inc., Chicago, said the most recent portfolio management changes make sense.
"They were trying to manage core funds with managers that specialized in growth funds," said Ms. Hughes. One example she cited was the Charter Fund; Mr. Sloan takes more of a core approach than his predecessor, she said. She also said AIM Blue Chip also has taken a more core approach.
The firm has taken steps to split its portfolio into two broad camps, said Ms. Hughes. It maintains a roster of funds that are very style-specific and includes the aggressive growth funds. It also has a broad group of all-cap or blended style funds that allow managers the flexibility to move around. The firm is better built for the long run, said Ms. Hughes, but she still sees the firm as primarily a growth shop.
