United States Trust Co. in Boston has set its sights on the institutional market with the launch of its first mutual fund.
The new fund, the Boston Managed Growth Fund, is run by Domenic Colasacco, executive vice president, and administered by Professionally Managed Portfolio, an affiliate of Wadsworth & Associates, New York.
The fund will invest in stocks, investment-grade bonds, and money market instruments. The minimum investment is $100,000.
Although this is its first proprietary mutual fund, U.S. Trust, a subsidiary of UST Corp., a Massachusetts-based banking company, has had experience managing other funds "for many, many years," said Lucia Santini, a senior vice president.
Ms. Santini said the bank's 20-year-old asset management group, which handles about $3.2 billion in assets for institutional and individual clients, has also helped manage the Calvert Social Investment Fund since its inception in 1982. She deferred any further comment to Mr. Colasacco, who was traveling and could not be reached.
In tapping Professionally Managed Portfolio to provide an umbrella of administrative services, U.S. Trust is taking an alternative route to proprietary fund management.
The umbrella approach allows managers to take advantage of another company's administrative infrastructure while focusing on fund management only.
Bank of New York Corp., for example, used a similar approach when it signed up Concord Financial Group's Infinity fund group to offer a money market fund for small businesses.
Such techniques "may be more common in the future," said Lynne Goldman, a consultant with Cerulli Associates. The Boston firm's research shows that U.S. Trust stands to save as much as $50,000 a year by farming out the administrative work.
