Short Takes: Asset-Manager Investor Expects Prices to Drop

Price tags these days on money management firms are steep. But one industry insider expects the cost of institutional money managers to come down before the cost of mutual fund firms.

"The market has been so strong for so many years that people have forgotten how vulnerable this can be," said P. Andrews McLane, a managing director at TA Associates, Boston. Consultants who tell institutions which money managers to use are quick to suggest switching firms when performance starts to go south, he said.

Yet when the stock market moves, typical mutual fund investors might switch funds, but often keep their money within a fund complex, Mr. McLane said.

And stable assets mean stable prices.

So while prices stay expensive, TA Associates-an investment firm that takes minority positions in asset managers-continues to look for its first investment in 1997.