Janus Global Research Fund

The team is led by Jim Goff, Director of Research, who is responsible to gather the best ideas from more than 35 Janus analysts situated around the world ....

YT Kum, CFA 28 January, 2008 | 0:00
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Management Profile
The team is led by Jim Goff, Director of Research, who is responsible to gather the best ideas from more than 35 Janus analysts situated around the world.

Investment Strategy
Janus Global Research Fund primarily applies bottom-up approach for stock selection. Investment decisions are made team-based. More than 35 analysts are divided into eight global sector teams and best picks from each team after discussion will be included to the portfolio. The Fund is managed in a diversified manner with scant regard to benchmark of MSCI World Growth Index.

The fund may sell securities for sector rebalancing, implying that macro fa

ctors are not entirely off the menu of consideration, though "bottom-up"is in focus.

Portfolio Analysis
Over the bumpy 2007, Janus Global Research Fund registered a solid 1-year return of 24.98 percent, occupying the first quartile of the Morningstar Global Large-Cap Growth Equity Category. With 43.70 percent US equities as of September-end 2007, which are recently drowned in the sub-prime issue, the Fund's solid return shows itself a proven bottom-up stock picker so far.

As for its portfolio of Septembers, some performance drivers like Apple Inc., Reliance Industries and Owens-Illinois Inc. are not surprising picks to investors, but the fund is not a trend chaser, as some "unloved"companies, like JA Solar, are also included. However, some detractors, especially financials and Japanese stocks, hurt the fund's performance over 2007.

The outbreak of sub-prime crisis last August battered some holdings of the fund including J.P. Morgan Chase, Fannie Mae and UBS, though their weightings were not significant. On the other hand, the fund did not reap profits from Japanese picks last year either, such as SONY, Park24, Shin-Etsu Chemical and Mitsubishi Estate.

The portfolio is managed in a diversified manner. As of September-end 2007, the portfolio held around 120 names and the top ten holdings soaked up only 18.21 percent of the portfolio asset. This diversified strategy has helped the fund to reward investors at a lower risk level. As of December-end 2007, the Fund's volatility (1-year) is merely 11.96, situated in the middle of the category.

Although Janus Global Research Fund is relatively new to Hong Kong investors, investors can feel ease with its analyst-driven strategy, as some other Janus's US-centric offerings, like Janus U.S. Research Fund and Janus Research Fund (not available for sale in Hong Kong) have been performing pretty well in the past few years. On the other hand, investors should keep their eyes closed to the team's retention and stability, which is the key to the fund's success.

Lastly, we would like to applaud for the fund's monthly disclosure of its full portfolio. It certainly helps investors to better understand and evaluate management's approach.

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About Author

YT Kum, CFA  YT Kum is a consultant for Morningstar, contributing to manager selection and asset allocation activities in Asia, and is responsible for providing investment thought leadership on topics relevant to investors in Asia.

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