Bill Gross Effect Continues: Janus Fund Attracts $770M in Nov
It might had looked as a surprise move of the ‘Bond King’, or bond investor extraordinaire William Hunt "Bill" Gross, exiting Pacific Investment Management Company (:PIMCO) to join a relatively smaller Janus Capital Group (JNS). However, Janus was sure about their recruitment. Analysts had opined, and as we also suggested previously, a number of clients were to follow Gross’ move to Janus. Recent developments confirm the predictions are turning true. (Read: Janus Funds to Gain as Bill Gross Takes Office)
According to the latest data, Gross-managed Janus Global Unconstrained Bond fund has attracted $770 million in November, adding to the $364 million inflow in October. The fund had attracted $66.4 million in just the concluding days of September when Gross joined Janus.
Morningstar confirms that since Gross joined, the fund has shot up from about $12 million in assets under management to $1.2 billion by November end. Analysts believe that Gross’s performance is already contributing positively. The bets on derivatives connected to Mexico and China are said to have been positive.
The small size of the Janus fund, which Gross took over, was also an advantage. The small structure helped it achieve new performance highs. JUCAX was incepted on May 27, 2014. Gross did acknowledge the small-size advantage and also the fact that he will again get to manage his client’s assets.
He had stated: “I look forward to returning my full focus to the fixed income markets and investing, giving up many of the complexities that go with managing a large, complicated organization. I chose Janus as my next home because of my long standing relationship with and respect for CEO Dick Weil and my desire to get back to spending the bulk of my day managing client assets.”
Gross Proves Critics Wrong?
Gross was blamed to have alienated senior executives despite PIMCO’s top brass urging him to maintain a friendly atmosphere. His abrasive style of management was evident when he shot out a scornful mail to top executives at PIMCO. Gross also took names, criticizing some senior executives. Following the mail, many of the senior executives in PIMCO were said to have threatened to quit if Gross remained in his position.
Reports suggested, Gross’ exit was a result of mounting tensions in Pimco that was becoming a tough task for Gross. Gross was perhaps on the verge of getting sacked.
However with the Janus fund attracting investors’ attention, Gross may have proved his critics wrong.
Meanwhile, PIMCO Total Return Fund (PTTAX) reported an estimated net outflow of $9.7 billion in November, according to Morningstar.
Janus Funds to Buy
For investors interested in Janus funds, we will suggest 3 top ranked funds. Here, we will suggest 3 funds that carry a Zacks Mutual Fund Rank #1 (Strong Buy) or Zacks Mutual Fund Rank #2 (Buy). Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but the likely future success of the fund.
These funds, in the Janus fund family, are among the biggest gainers this year so far. They also relatively low expense ratio and none of these funds carry sales load.
INTECH US Core T (JRMSX) seeks capital appreciation over the long term. It invests a minimum of 80% of its assets in domestic common stocks listed in the S&P 500 Index by investing INTECH's mathematical investment process.
The fund carries a Zacks Mutual Fund Rank #1 (Strong Buy) and has returned 12.9%. The fund has an annual expense ratio of 0.89% as compared to category average of 1.20%.
Top holdings of the fund include Home Depot Inc (HD), Southwest Airlines Co (LUV) and Comcast Corp Class A (CMCSA).
Janus Contrarian T (JSVAX) invests most of its assets in equities having the potential for long-term capital growth. The portfolio manager focuses investing in firms that offer favorable price/free cash flow. The fund may also invest in non-US equities.
The fund carries a Zacks Mutual Fund Rank #1 (Strong Buy) and has returned 14.8%. The fund has an annual expense ratio of 0.89% as compared to category average of 1.09%.
Top holdings of the fund include Endo International PLC (ENDP), Mallinckrodt PLC (MNK) and United Continental Holdings Inc (UAL).
Janus Research T (JAMRX) seeks capital appreciation over the long term. The fund invests in companies of all sizes but will be selected based on their growth potentials. It may invest in small emerging growth companies or even in large prominent firms. The fund also invests in non-US firms.
The fund carries a Zacks Mutual Fund Rank #2 (Buy) and has returned 13.6%. The fund has an annual expense ratio of 0.80% as compared to category average of 1.09%.
Top holdings of the fund include Apple, Google Inc (GOOG) and American Tower Corp (AMT).
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