American Express is launching its first multi-managed fund in late January. The Small Cap Growth Fund is intended to fill a gap for a company lacking relevant managers.

"In the past year or so, we've launched a fair number of mutual funds, so we have been making a concerted effort to broaden our product line and fill in gaps," said American Express spokesman David Kanihan. "To do so, there were some areas we weren't so deep in internally."

American Express first dipped its toes in the outside management waters when it used affiliate Kenwood Capital Management for its AXP Small Cap Advantage Fund.

While the company doesn't plan on adopting a multi-managed strategy as a matter of course, it will consider doing so again in similar cases. American Express is focusing on its ability to expedite fund start-ups without sacrificing quality.

"I think the trend is that we are going on an aggressive product launch schedule and we're going to do what we had to do to launch those products successfully," said Kanihan.

As for future product launches, Kanihan could not be specific about American Express's future direction. However, he said, "I would expect that this will not be the last fund launched in 2001."

When asked about the addition of high net worth-focused products, he replied, "None of our retail mutual funds are positioned as tax-managed retail funds."

With American Express's wealth management center, the company has demonstrated a strong commitment to serving that sector of the market. It remains to be seen whether American Express will be satisfied making due with just institutional tax-managed funds. 

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