Question-and-Answer Session
Operator
(Operator instructions) Your first question comes from the line of Marc Irizarry of Goldman Sachs.
Marc Irizarry – Goldman Sachs
Great. Thanks. Can you just elaborate a little bit on your investment portfolio, we continue to see these mark-to-market heads. But what sort of the size of that now, so we can get a sense of what we should think about for that line item going forward?
Dan Connealy
Well, Marc, this is Dan. We have $54 million invested in these securities and are primarily invested in our mutual funds. So, if there were marked down this quarter as we reported because they have been below our cost for a period of time more than six months. So, that’s why we were required to write them down. And I think we should acknowledge that if the markets should go no where and they have already gone up since the end of the quarter but we will probably have another million write off next year – next quarter. But we of course won’t know until we see the market action.
Marc Irizarry – Goldman Sachs
Great. And Dan, if you could just stay on the financials for just a second. Just in terms of the operating margin, how should we think about the progression from here on and on a quarterly basis and what sort of your prognosis for margin if the markets stay flat from where they are now?
Dan Connealy
Well, if the markets stay flat, we should continue to gradually improve through the year and we still believe that we are on target that by the fourth quarter we would have an operating margin of about 20%.
Marc Irizarry – Goldman Sachs
Okay. Great. And Hank could you just speak to the diversification of the flow and obviously as things are trying to attack in couple of other areas and may be in fixed income funds. Can you just elaborate a little bit on what you are seeing in April and what you are seeing throughout the first quarter in terms of the – in that sort of on concentration of flows?
Hank Herrmann
Well, go ahead. I’m going to let Tom Butch answer that.
Tom Butch
Hi, Marc. I think Hank mentioned those funds which are capturing share in addition to the ones which traditionally have done so. I think one of the silver linings if you will of the market is that we have been able to go to market and gain good reception for certain products which really weren’t in asset classes that were in favor for a long time. For example, our high yield product is our third fastest grower year to date. We have a very good short-term high quality bond product that also is gaining a lot of sales and so we have seen fixed income flows become a more important part of the business. Generally we have been able to participate in that. And as Hank indicated previously, we have seen continued flows especially in asset strategy to lesser but meaningful extent in Global Natural Resources. And a couple of fund which have been good steady growers over the lat few years, the Large Cap Growth fund, the Science and Technology fund continue on that pace. So, we have been in this market take advantage of the opportunities it’s given us.
- To read the full transcript on Seeking Alpha, click here »
