Mature and independent.

Business and family relationships are similar. When firms or children mature they must strike out on their own. The first African-American-founded equity mutual fund, Ariel Capital Management Inc., did just that recently when it amicably severed its eight-year management and administrative links to the Calvert Group based in Bethesda, Md.

Industry sources say Ariel paid about $4 million--or 1% of the assets of the firm's two funds--for its freedom. John W. Rogers Jr., 36, founder and president of Ariel Capital, says, "We are paying Calvert for the work that we put in together over the last eight years and the good will and intangibles going forward."

The separation was among several changes Rogers made recently, allowing the Chicago-based firm with more than $2.1 billion under management to serve its individual investors more effectively. The first was Ariel's transformation of its fund to no-load status by eliminating a front-end sales charge, which was 4.75% last summer. Second, Ariel has assumed full responsibility from Calvert for the management, distribution and transfer agent operations for the funds. Finally, the funds are now known as the Ariel Growth Fund and Ariel Appreciation Fund. Each dropped the Calvert prefix they had had since their inception in 1988.

But Mellody Hobson, Ariel vice president and marketing director, says more than a name or operation change occurred. Ariel had grown to the point of being able to operate independently, but its patient, value investment philosophy needed more aggressive, undiluted marketing approaches. She adds there was no problem with Calvert, which last July had $4.6 billion under management in 32 funds, including Ariel; they were "just organizations going in different directions."

Are more Ariel funds in the offing? Eric T. McKissack, Ariel co-chief investment officer, says none are being planned now. But, he notes, Ariel is going to provide private-label money-market taxable and taxexempt funds for investors who wish to shift in and out of equity funds.

During the second quarter, Ariel's funds suffered along with other equity funds. The Appreciation Fund's $210 million was down 0.4%, versus the Russell 2500, which fell 4%. By contrast, the S&P 400 was down 3.7%. But for the year ending June 30, Lipper Analytical Services says it still ranked 10th among 61 mid-cap funds.

During the second quarter, Ariel's Growth Fund--which is closed to new investors and held $200 million--fell 0.6%, while the S&P 500 was up 0.4%. For the quarter, it ranked 9th among 234 funds in the Lipper small-company growth-funds ranking.

To find out more about the Ariel funds, call 800-29-ARIEL.