Advisory Research Inc., a Chicago-based investment manager that was recently acquired by investment bank Piper Jaffray, on Tuesday rolled out its second mutual fund. The launch of the Advisory Research International Small Cap fund comes five months after Advisory Research entered the mutual fund business with the rollout of its All Cap Value fund.

The International Small Cap fund carries an expense ratio of 135 basis points and is available through the Schwab and Pershing platforms.

UMB Fund Services serves as transfer agent, fund accountant and co-administrator, Mutual Fund Administration Corporation serves as co-administrator, UMB Bank is custodian and Grand Distribution Services is the distributor.

Founded in 1974, Advisory Research offers investment management services to institutions and high-net-worth investors. It was purchased by Piper Jaffray in a deal that closed last month.

Explaining why Advisory Research decided to enter the mutual fund business in the fall of last year, Advisory Research CEO Brien O'Brien pointed to market demand.

"Post-Madoff, there's been a reluctance on the part of some investors to utilize limited partnership structures," O'Brien said. Rolling out mutual funds "is an optimal course of action."

The International Small Cap fund will seek to invest in 60 to 80 securities under normal conditions. It will attempt to replicate the investment strategy utilized in the International Value limited partnership and institutional separate account products Advisory Research launched in 2006.

Jonathan Brodsky is the fund's lead portfolio manager.

Advisory Research has three other mutual funds in registration. Their rollout is "not imminent," O'Brien said. 

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