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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-1879
Janus Investment Fund
(Exact name of registrant as specified in charter)
151 Detroit Street, Denver, Colorado | 80206 | |
(Address of principal executive offices) | (Zip code) |
Stephanie Grauerholz-Lofton, 151 Detroit Street, Denver, Colorado 80206
(Name and address of agent for service)
(Name and address of agent for service)
Registrant’s telephone number, including area code: 303-333-3863
Date of fiscal year end: 6/30
Date of reporting period: 12/31/10
Table of Contents
Item 1 — Reports to Shareholders
Table of Contents
2010 SEMIANNUAL REPORT
Janus Asset Allocation Fund
(formerly named Janus Modular Portfolio Construction® Fund)
HIGHLIGHTS
• | Portfolio management perspective |
• | Investment strategy behind your fund |
• | Fund performance, characteristics and holdings |
![(JANUS LOGO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932janus.gif)
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Janus Asset Allocation Fund
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EX-99.CERT | ||||||||
EX-99.906CERT |
Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus containing this and other information, please call Janus at 877.33JANUS(52687). You can also visit janus.com/info. Read it carefully before you invest or send money.
Table of Contents
Co-Chief Investment Officers’ Market Perspective (unaudited)
![(JONATHAN COLEMAN PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932pcolemaj.jpg)
Jonathan Coleman
Co-Chief Investment Officer
![(GIBSON SMITH PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932psmithgi.jpg)
Gibson Smith
Co-Chief Investment Officer
We would like to take this opportunity to thank you for investing with Janus and to share some good news. Brent Lynn, portfolio manager of Janus Overseas Fund, was recently named Morningstar’s International Stock-Fund Manager of the Year. Please join us in congratulating Brent and the entire investment team on this prestigious honor. Brent is the first to say that this is a collective, rather than an individual honor, and we are proud that Janus’ fundamental research approach has been recognized as it continues to be the driving force behind the investment process of all our products.
Opportunities in the Recovery
As we head into 2011, the big surprise for the year could be that the recovery looks more and more normal by the day. Economic data points continue to impress, defying skeptics who predicted a slide back to recession. Recent clarity on taxes should facilitate greater investment and spending by companies, and the Federal Reserve (Fed) has indicated that it intends to continue stimulating the economy through monetary policy. While unemployment remains high, job creation will follow if companies continue to show strong profitability and see growth on the horizon, which we expect to happen. Overall, the recovery appears to be gaining momentum.
One reason we’re more bullish is that fiscal and monetary policies are working together to fuel economic growth. The extension of the Bush tax package for two years will add an estimated one percentage point to growth in 2011. Economists and politicians may debate the fiscal responsibility of the package, but along with the improved transparency on taxes, the near-term effect is likely to be an increase in spending and confidence. At the same time, the Fed has signaled that it intends to continue stimulating the economy through additional “quantitative easing” as well as reinvesting coupon and principal payments in the Fed’s current portfolio. All told, we believe these steps will help the healing process now underway.
Naturally, our optimism comes with caveats. Recent data on home prices have been disappointing and we continue to view a potential downturn in housing as the biggest risk for the U.S. economy. We are also concerned about sovereign debt issues in Europe and budgetary challenges to state and local governments in the U.S. Eventually, self-sustaining growth will be necessary to facilitate robust job creation.
Equities Remain Attractive
We think U.S. equities will outperform in 2011. Stimulus measures are working through the system and should provide further support. Ideally, we’ll see a “Goldilocks” scenario: the U.S. economy will get a short-term boost from the stimulus and increased credibility on the international stage if Washington finally tackles the deficit.
Despite the rally late in the period, equity valuations remain moderate by historical standards. Companies have emerged from the recession with pristine balance sheets and net margins of 12.3%, as of the fourth quarter of 2010, close to the highest level in more than 25 years for large firms. Another positive indicator for stocks is an increase in mergers-and-acquisitions activity – evidence that companies are starting to deploy their cash.
With the outlook improving, we think that economically sensitive sectors could outperform. Consumer discretionary, energy, technology and industrials may do well if economic indicators continue to gain strength. Increasing clarity on regulations may help health care and financial services. As rules become more clearly defined, these sectors could regain some market leadership.
Going forward, fundamentals should matter more as the market increasingly differentiates companies based on their balance sheets, growth rates and competitive advantages. We believe this will create a better environment for active managers to add value through stock selection.
Higher Yields and Opportunities in Fixed Income
Bonds had a difficult fourth quarter as yields rose sharply and some of the risk aversion bid into the Treasury market receded. Fiscal and monetary policies will be a headwind for the bond market over the next few years. At the same time, we think the rise in yields is justified as economic data have come in better than expected. In our opinion,
Janus Asset Allocation Fund | 1
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Continued
bonds remain attractive when evaluated on real returns (yield minus inflation).
The media continues to discuss “bursting bubbles,” and the more this gets overplayed the greater the opportunities for investors. Higher yields and steeper curves make fixed income more attractive in a low inflationary environment. In this context, we continue to favor corporate debt securities as we believe the health and profitability of corporations are improving. The new wave of financial conservatism in corporations is a welcome sign. We think it represents a new mindset for management that will result in more disciplined investment. More conservative capital structures should lead to higher bond prices.
In this volatile climate, similar to selection of individual equities, individual security selection holds the key to higher risk-adjusted returns. We believe that the construct of the indices does not reflect a proper risk appetite for most investors, in our view, forcing investors to hold debt securities that are not fundamentally improving, thus presenting greater downside risk. We believe an active approach with a focus on fundamental company analysis will yield higher risk-adjusted return with better downside protection long term.
Looking Ahead
Investors should be paying keen attention to the strength of the recovery in the United States, as well as pressures in the global economy. Strong Asian and emerging market growth is fueling inflation in certain regions and forcing central banks to raise rates. Developed nations, meanwhile, are continuing to aggressively pursue loose monetary and fiscal policies. In this environment, investors need to focus more than ever on balance in their portfolios, taking in to account current valuations and expected returns. The global recovery is well underway and this will present new opportunities in the markets as well as new challenges. As always, we will work hard to find the most promising investment opportunities for our shareholders.
Thanks again for your trust and confidence in Janus.
Sincerely,
![(-s- JONATHAN COLEMAN)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932scolemaj.gif)
Jonathan Coleman
Co-Chief Investment Officer
![(-s- GIBSON SMITH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932ssmithgi.gif)
Gibson Smith
Co-Chief Investment Officer
2 | DECEMBER 31, 2010
Table of Contents
Co-Chief Investment Officers’ Market Perspective (unaudited)
Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus containing this and other information, please call Janus at 877.33JANUS (52687) or download the file from janus.com/info. Read it carefully before you invest or send money.
Past performance is no guarantee of future results. Visit janus.com/advisor for current month-end performance.
Award based on Class T Shares. Established in 1988, the Morningstar Fund Manager of the Year Award recognizes portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus to benefit investors. To qualify for the award, managers’ funds must have not only posted impressive returns for the year, but the managers also must have a record of delivering outstanding long-term performance and of aligning their interests with shareholders’. The Fund Manager of the Year Award winners are chosen based on Morningstar’s proprietary research and in-depth evaluation by its fund analysts.
The opinions are those of the authors as of December 2010 and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of individual holdings or market sectors, but as an illustration of broader themes.
Statements in this piece that reflect projections or expectations of future financial or economic performance of a mutual fund or strategy and of the markets in general and statements of a fund’s plans and objectives for future operations are forward-looking statements. Actual results or events may differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements. Important factors that could result in such differences, in addition to the other factors noted with such forward-looking statements, include general economic conditions such as inflation, recession and interest rates.
Funds distributed by Janus Distributors LLC (2/11)
Janus Asset Allocation Fund | 3
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Useful Information About Your Fund Report (unaudited)
Management Commentary
The Management Commentary in this report includes valuable insight from the Fund’s manager as well as statistical information to help you understand how your Fund’s performance and characteristics stack up against those of comparable indices.
Please keep in mind that the opinions expressed by the Fund’s manager in the Management Commentary are just that: opinions. They are a reflection of the manager’s best judgment at the time this report was compiled, which was December 31, 2010. As the investing environment changes, so could the manager’s opinions. These views are unique to the manager and aren’t necessarily shared by fellow employees or by Janus in general.
Fund Expenses
We believe it’s important for our shareholders to have a clear understanding of Fund expenses and the impact they have on investment return.
The following is important information regarding the Fund’s Expense Example, which appears in the Fund’s Management Commentary within this Semiannual Report. Please refer to this information when reviewing the Expense Example for the Fund.
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (applicable to Class A Shares only); redemption fees, where applicable (and any related exchange fees); and (2) ongoing costs, including management fees; distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only); administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares only); administrative, networking or omnibus fees (applicable to Class A Shares, Class C Shares, and Class I Shares only); and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The example is based upon an investment of $1,000 invested at the beginning of the period and held for the six-month period from July 1, 2010 to December 31, 2010.
Actual Expenses
The first line of the table in each example provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
The second line of the table in each example provides information about hypothetical account values and hypothetical expenses based upon the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Janus Capital Management LLC (“Janus Capital”) has contractually agreed to waive the Fund’s total annual fund operating expenses, excluding any expenses of an underlying fund (acquired fund fees and expenses), class-specific distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares only), brokerage commissions, interest, dividends, taxes, and extraordinary expenses, to certain limits until at least November 1, 2011. Expenses in the examples reflect application of these waivers. Had the waivers not been in effect, your expenses would have been higher. More information regarding the waivers is available in the Fund’s prospectuses.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as underlying funds’ redemption fees (where applicable) and any related exchange fees. These fees are fully described in certain underlying funds’ prospectuses. Therefore, the second line of each table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
4 | DECEMBER 31, 2010
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Janus Dynamic Allocation Fund (unaudited)
Fund Snapshot We believe that dynamic asset allocation among investments with distinct risk/return profiles can provide long-term growth of capital and outperform peers over time. We determine asset allocation by first isolating the drivers of risk and return to identify assets as core, alpha and alternative, then allocating among these assets using a dynamic approach that seeks to take advantage of market movements to enhance returns during rallies and protect principal during declines. | ![]() Dan Scherman portfolio manager |
Performance Overview
Janus Dynamic Allocation Fund’s Class I Shares returned 15.41% for the six-month period ended December 31, 2010. This compares to a return of 24.46% for the Russell 3000 Index, the Fund’s primary benchmark, during the same period. These results compare to a 18.57% return by its secondary benchmark, the Dynamic Allocation Composite Index, a hypothetical combination of unmanaged indices, which combines the total returns from the Russell 3000 Index (50%), the Barclays Capital U.S. Aggregate Bond Index (25%), and the MSCI All Country World ex-U.S. Index (25%).
Market Review
World equity markets posted a strong second-half of 2010 and finished near their highest levels since July 2008. Worries over how deep spending cuts in government austerity programs would impact global growth and disappointing economic data from the U.S. helped markets start off on a negative note. Mixed economic data led to a range-bound market until August, when improving economic data began lifting markets, a trend that would continue through year-end. Stimulus efforts in Japan and the U.S., strong manufacturing data in China, the U.S. and India helped offset a re-emergence of sovereign debt concerns in Europe and tightening measures in China near period end. Emerging markets, led by Russia, outperformed developed markets, which were held back due to modest gains in Japan. In terms of sectors, materials and energy were top performers, while health care and utilities lagged. Commodities also posted strong gains, led by palladium and sugar; natural gas, which declined, was a notable exception. The dollar was weaker relative to most major currencies.
In the U.S. fixed income market, the investment climate during the last half for 2010 can be described as one of extremes as investors continued to fret over the current easy-money environment potentially ending in inflation while keeping a worried eye on a stubbornly high unemployment rate and a weak housing market in the U.S. Add improving economic data (most notably in consumer-related areas), a steadily deteriorating European banking crises and geopolitical events on the Korean peninsula and you had a true tug-of-war between fear and greed in the market for much of the year. Contributing to rate volatility was the Federal Reserve’s (Fed) implementation of its roughly $600 billion quantitative easing (QE2) program late in the period and the extension of Bush-era tax cuts. While long-term interest rates backed up during the period, most major fixed income segments held onto positive returns.
Investment Process
Janus Dynamic Allocation Fund is structured as a proprietary fund-of-funds, which means we have the ability to select from Janus, INTECH and Perkins funds currently available to shareholders. When we want exposure to an asset class not represented by any of these managers, we are free to invest outside our corporate umbrella, as we have done this period in the case of our commodities and foreign currency strategy investments. (Please see “Notes to Financial Statements” for information about the hedging techniques used by the Fund.)
Our choice of investments is driven not only by an evaluation of the quality and sustainability of fund performance, but also by our characterization of each underlying strategy as CORE, ALPHA or ALTS (Alternative). While we employ very specific quantitative and qualitative criteria for inclusion in each of these “modules,” they can be simplified this way:
• | CORE strategies are stock and bond portfolios – both international and domestic – that seek to provide market-like exposure to the segments of the market in which each manager specializes. |
• | ALPHA strategies are those that seek market-beating performance more or less independent of investment style or asset class. |
Janus Asset Allocation Fund | 5
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Janus Dynamic Allocation Fund (unaudited)
• | ALTS strategies march to their own beat and seek to diversify some of the risks assumed by investing in CORE and ALPHA strategies. |
Once we’ve defined our investable universe and parsed it into these three categories, we then employ techniques such as mean-variance optimization (as well as a measured dose of qualitative judgment) to assemble each module independently. For example, in the CORE module, we mix and match the eligible CORE funds into a portfolio that best mimics what we believe represents “the market” to a modern investor. Next, we look across the roster of available ALPHA strategies to assemble a portfolio that gives us what we believe will be the greatest return in exchange for the least amount of risk. Finally, we assemble a portfolio of ALTS assets that we believe will have the lowest possible correlation with the first two modules in an effort to diversify away some of the risks inherent in investing in the other two.
Once the three individual modules are built, we attempt to combine them in a way designed to take advantage of both the benefits of asset class diversification and the current market environment. We do this not by allocating tactically among the modules, or by investing a set percentage of Fund assets in each asset class and then periodically rebalancing back toward those targets, but instead by allocating assets on the basis of how much risk we believe shareholders can bear. When we think risky assets are performing well, we systematically allocate more to the ALPHA module; when we think they are performing poorly, we systematically allocate a greater percentage to CORE.
Portfolio Review
We think the best way to navigate the current macroeconomic environment is to maintain exposure across a broad range of asset classes while remaining disciplined in the allocation process. With that said, we continued to make the portfolio incrementally more aggressive by increasing our ALPHA category while decreasing our CORE category. The net effect was to reduce our net income exposure marginally and to increase our more aggressive holdings (Janus Overseas Fund, Janus Global Select Fund, Janus Contrarian Fund and Janus Forty Fund) at the expense of more sedate equity strategies. We also decided to reduce the interest rate sensitivity of the portfolio given our concern about a further backup in rates; we increased our weighting in Janus Short-Term Bond Fund, reduced exposure to Janus Flexible Bond Fund and increased our weighting in the ALTS (Alternatives) category. Among other changes, we added the new Janus Global Bond Fund due to our desire for more consistent exposure to non-U.S. bonds, which have grown in importance among asset classes. Finally, we sold the Goldman Sachs Absolute Return Tracker Fund to invest in Janus Long/Short Fund.
Given the strong equity market performance during the period, the Fund’s underperformance relative to its primary benchmark was largely driven by the Fund’s roughly 25.5% fixed income weighting. Disappointingly, both our ALPHA and CORE categories failed to keep pace in the period; CORE lagged our secondary benchmark, the Dynamic Allocation Composite Index, while ALPHA lagged our primary benchmark, the all-equity Russell 3000 Index. Meanwhile, our ALTS sleeve performed as expected and provided the diversification and reduced volatility characteristics we seek for the Fund.
Our asset allocation through period end comprised of roughly 65.5% equity, 22% fixed income and 10% alternative investments consisting mostly of commodity-related exchange traded funds and Janus Global Real Estate Fund. In terms of our sleeves, CORE was roughly 46% of the Fund while the ALPHA and ALTS sleeves comprised of 41% and 10% respectively at period end. This is the most aggressive positioning we have had since the Fund’s inception. Part of the moves is a function of the dynamic rebalancing model we use to allocate between CORE and ALPHA, but we also believe the recovery is sustainable and have positioned the Fund accordingly. That said we haven’t gone “all-in.” For example, some of the incremental cash generated by reducing our interest rate exposure was invested in the ALTS sleeve rather than ALPHA. Along with our concerns over rising rates, we are also cognizant of inflation risks, which we try to hedge through our commodity exposure. We are hopeful these changes and a somewhat more muted market may serve the Fund well.
Thank you for investing in Janus Dynamic Allocation Fund.
6 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Janus Dynamic Allocation Fund
(% of Net Assets)
(% of Net Assets)
Core | ||||
INTECH Risk-Managed Growth Fund – Class I Shares | 2.3% | |||
INTECH Risk-Managed International Fund – Class I Shares | 2.2% | |||
INTECH Risk-Managed Value Fund – Class I Shares | 2.4% | |||
Janus Flexible Bond Fund – Class I Shares | 13.2% | |||
Janus Global Bond Fund – Class I Shares | 2.1% | |||
Janus High-Yield Fund – Class I Shares | 3.0% | |||
Janus International Equity Fund – Class I Shares | 7.2% | |||
Janus Research Core Fund – Class I Shares | 0.6% | |||
Janus Research Fund – Class I Shares | 0.9% | |||
Janus Short-Term Bond Fund – Class I Shares | 3.0% | |||
Janus Triton Fund – Class I Shares | 2.9% | |||
Perkins Large Cap Value Fund – Class I Shares | 0.7% | |||
Perkins Mid Cap Value Fund – Class I Shares | 2.2% | |||
Perkins Small Cap Value Fund – Class I Shares | 1.2% | |||
Alpha | ||||
Janus Contrarian Fund – Class I Shares | 10.6% | |||
Janus Forty Fund – Class I Shares | 10.3% | |||
Janus Global Life Sciences Fund – Class I Shares | 3.7% | |||
Janus Global Select Fund – Class I Shares | 7.4% | |||
Janus Overseas Fund – Class I Shares | 10.6% | |||
Alternative | ||||
iShares S&P GSCI Commodity – Indexed Trust (ETF) | 5.0% | |||
Janus Global Real Estate Fund – Class I Shares | 1.9% | |||
Janus Long/Short Fund – Class I Shares | 1.3% | |||
WisdomTree Dreyfus Chinese Yuan Fund (ETF) | 2.5% |
Janus Dynamic Allocation Fund At A Glance
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif31p01.gif)
Janus Asset Allocation Fund | 7
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Janus Dynamic Allocation Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif31m01.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||
Fiscal | One | Since | Total Annual Fund | Net Annual Fund | |||||||
Year-to-Date | Year | Inception* | Operating Expenses | Operating Expenses | |||||||
Janus Dynamic Allocation Fund – Class A Shares | |||||||||||
NAV | 15.29% | 11.53% | 3.60% | 2.18% | 1.31% | ||||||
MOP | 8.67% | 5.12% | 0.99% | ||||||||
Janus Dynamic Allocation Fund – Class C Shares | |||||||||||
NAV | 14.91% | 10.66% | 3.02% | 2.89% | 2.06% | ||||||
CDSC | 13.80% | 9.59% | 3.02% | ||||||||
Janus Dynamic Allocation Fund – Class I Shares | 15.41% | 11.54% | 3.74% | 1.96% | 1.06% | ||||||
Janus Dynamic Allocation Fund – Class S Shares | 15.14% | 11.02% | 3.40% | 2.52% | 1.56% | ||||||
Janus Dynamic Allocation Fund – Class T Shares | 15.24% | 11.48% | 3.63% | 1.73% | 1.31% | ||||||
Russell 3000® Index | 24.46% | 16.93% | 2.44% | ||||||||
Dynamic Allocation Composite Index | 18.57% | 13.34% | 4.31% | ||||||||
Lipper Quartile – Class I Shares | – | 3rd | 3rd | ||||||||
Lipper Ranking – based on total returns for Mixed-Asset Target Allocation Growth Funds | – | 400/558 | 277/524 | ||||||||
Visit janus.com/advisor/mutual-funds to view current performance and characteristic information | |||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) or visit janus.com/advisor/mutual-funds for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
8 | DECEMBER 31, 2010
Table of Contents
(unaudited)
A Fund which redeems or exchanges certain underlying funds’ shares held for 90 days or less may be subject to an underlying fund’s 2.00% redemption fee, if any.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any expenses of an underlying fund (acquired fund fees and expenses), the distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund’s and an underlying fund’s performance may be affected by risks that include those associated with non-diversification, non-investment grade debt securities, undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), derivatives and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info for more information about risks, portfolio holdings and other details.
Because Janus Capital is the adviser to the Fund and to the underlying funds held within the Fund, it is subject to certain potential conflicts of interest when allocating the assets of the Fund among underlying Janus funds. Performance of the Fund depends on that of the underlying funds, which are subject to the volatility of financial markets.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares commenced operations on July 6, 2009, after the reorganization of each class of Janus Adviser Modular Portfolio Construction® Fund (the “JAD predecessor fund”) into corresponding shares of the Fund. Performance shown for each class for periods prior to July 6, 2009, reflects the historical performance of each corresponding class of the JAD predecessor fund prior to the reorganization, calculated using the fees and expenses of the corresponding class of the JAD predecessor fund, respectively, net of any fee and expense limitations or waivers. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class T Shares of the Fund commenced operations on July 6, 2009. Performance shown for Class T Shares for periods prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class I Shares prior to the reorganization, calculated using the fees and expenses of Class T Shares, without the effect of any fee and expense limitations or waivers. If Class T Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class T Shares reflects the fees and expenses of Class T Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class I Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
August 31, 2008 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedule of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
Effective September 15, 2010, Janus Modular Portfolio Construction® Fund changed its name to Janus Dynamic Allocation Fund.
* | The predecessor Fund’s inception date – September 3, 2008 |
Janus Asset Allocation Fund | 9
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Janus Dynamic Allocation Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,152.90 | $ | 3.26 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.18 | $ | 3.06 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,149.10 | $ | 7.15 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.55 | $ | 6.72 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,154.10 | $ | 2.61 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.79 | $ | 2.45 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,152.50 | $ | 3.80 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.68 | $ | 3.57 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,152.40 | $ | 4.01 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.48 | $ | 3.77 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.60% for Class A Shares, 1.32% for Class C Shares, 0.48% for Class I Shares, 0.70% for Class S Shares and 0.74% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
10 | DECEMBER 31, 2010
Table of Contents
Janus Dynamic Allocation Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Exchange – Traded Funds – 7.5% | ||||||||||
Commodity – 5.0% | ||||||||||
12,111 | iShares S&P GSCI Commodity – Indexed Trust (ETF) | $ | 412,962 | |||||||
Currency – 2.5% | ||||||||||
8,250 | WisdomTree Dreyfus Chinese Yuan Fund (ETF) | 209,310 | ||||||||
Total Exchange – Traded Funds (cost $583,562) | 622,272 | |||||||||
Mutual Funds(1) – 89.7% | ||||||||||
Equity Funds – 68.4% | ||||||||||
14,930 | INTECH Risk-Managed Growth Fund – Class I Shares | 191,554 | ||||||||
24,005 | INTECH Risk-Managed International Fund – Class I Shares | 184,360 | ||||||||
21,370 | INTECH Risk-Managed Value Fund – Class I Shares | 201,948 | ||||||||
60,499 | Janus Contrarian Fund – Class I Shares | 884,496 | ||||||||
25,217 | Janus Forty Fund – Class I Shares | 856,613 | ||||||||
13,327 | Janus Global Life Sciences Fund – Class I Shares | 309,596 | ||||||||
17,097 | Janus Global Real Estate Fund – Class I Shares | 161,392 | ||||||||
52,215 | Janus Global Select Fund – Class I Shares | 620,314 | ||||||||
52,535 | Janus International Equity Fund – Class I Shares | 598,372 | ||||||||
10,327 | Janus Long/Short Fund – Class I Shares | 106,989 | ||||||||
17,440 | Janus Overseas Fund – Class I Shares | 884,368 | ||||||||
2,175 | Janus Research Core Fund – Class I Shares | 45,834 | ||||||||
2,572 | Janus Research Fund – Class I Shares | 75,675 | ||||||||
14,801 | Janus Triton Fund – Class I Shares | 243,913 | ||||||||
4,400 | Perkins Large Cap Value Fund – Class I Shares | 59,224 | ||||||||
8,172 | Perkins Mid Cap Value Fund – Class I Shares | 184,436 | ||||||||
4,028 | Perkins Small Cap Value Fund – Class I Shares | 96,805 | ||||||||
5,705,889 | ||||||||||
Fixed-Income Funds – 21.3% | ||||||||||
105,506 | Janus Flexible Bond Fund – Class I Shares | 1,098,320 | ||||||||
17,927 | Janus Global Bond Fund – Class I Shares | 179,274 | ||||||||
27,102 | Janus High-Yield Fund – Class I Shares | 246,627 | ||||||||
81,226 | Janus Short-Term Bond Fund – Class I Shares | 250,175 | ||||||||
1,774,396 | ||||||||||
Total Mutual Funds (cost $6,245,473) | 7,480,285 | |||||||||
Money Market – 3.2% | ||||||||||
266,847 | Janus Cash Liquidity Fund LLC, 0% (cost $266,847) | 266,847 | ||||||||
Total Investments (total cost $7,095,882) – 100.4% | 8,369,404 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.4)% | (32,389) | |||||||||
Net Assets – 100% | $ | 8,337,015 | ||||||||
(1) | The Fund invests in mutual funds within the Janus family of funds and they may be deemed to be under common control because they share the same Board of Trustees. |
See Notes to Schedule of Investments and Financial Statements.
Janus Asset Allocation Fund | 11
Table of Contents
Statement of Assets and Liabilities
As of December 31, 2010 (unaudited) | Janus Dynamic | |||||
(all numbers in thousands except net asset value per share) | Allocation Fund(1) | |||||
Assets: | ||||||
Investments at cost | $ | 7,096 | ||||
Unaffiliated investments at value | $ | 622 | ||||
Affiliated investments at value | 7,747 | |||||
Cash | – | |||||
Receivables: | ||||||
Fund shares sold | 1 | |||||
Dividends | 7 | |||||
Due from adviser | 7 | |||||
Non-interested Trustees’ deferred compensation | – | |||||
Other assets | 7 | |||||
Total Assets | 8,391 | |||||
Liabilities: | ||||||
Payables: | ||||||
Investments purchased | 7 | |||||
Fund shares repurchased | 4 | |||||
Dividends | – | |||||
Advisory fees | – | |||||
Administrative services fees | – | |||||
Distribution fees and shareholder servicing fees | 3 | |||||
Administrative, networking and omnibus fees | 1 | |||||
Non-interested Trustees’ fees and expenses | – | |||||
Non-interested Trustees’ deferred compensation fees | – | |||||
Accrued expenses and other payables | 39 | |||||
Total Liabilities | 54 | |||||
Net Assets | $ | 8,337 | ||||
Net Assets Consist of: | ||||||
Capital (par value and paid-in surplus)* | $ | 7,136 | ||||
Undistributed net investment income* | 29 | |||||
Undistributed net realized loss from investment and foreign currency transactions* | (102) | |||||
Unrealized net appreciation of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 1,274 | |||||
Total Net Assets | $ | 8,337 | ||||
Net Assets - Class A Shares | $ | 3,421 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 335 | |||||
Net Asset Value Per Share(2) | $ | 10.20 | ||||
Maximum Offering Price Per Share(3) | $ | 10.82 | ||||
Net Assets - Class C Shares | $ | 2,975 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 294 | |||||
Net Asset Value Per Share(2) | $ | 10.13 | ||||
Net Assets - Class I Shares | $ | 1,382 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 135 | |||||
Net Asset Value Per Share | $ | 10.23 | ||||
Net Assets - Class S Shares | $ | 342 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 34 | |||||
Net Asset Value Per Share | $ | 10.19 | ||||
Net Assets - Class T Shares | $ | 217 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 21 | |||||
Net Asset Value Per Share | $ | 10.20 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Redemption price per share may be reduced for any applicable contingent deferred sales charge. | |
(3) | Maximum offering price is computed at 100/94.25 of net asset value. |
See Notes to Financial Statements.
12 | DECEMBER 31, 2010
Table of Contents
Statement of Operations
For the six-month period ended December 31, 2010 (unaudited) | Janus Dynamic | |||
(all numbers in thousands) | Allocation Fund(1) | |||
Investment Income: | ||||
Dividends from affiliates | $ | 136 | ||
Total Investment Income | 136 | |||
Expenses: | ||||
Advisory fees | 3 | |||
Shareholder reports expense | 15 | |||
Transfer agent fees and expenses | 1 | |||
Registration fees | – | |||
Custodian fees | 2 | |||
Professional fees | 26 | |||
Non-interested Trustees’ fees and expenses | – | |||
Administrative services fees - Class S Shares | – | |||
Administrative services fees - Class T Shares | – | |||
Distribution fees and shareholder servicing fees - Class A Shares | 4 | |||
Distribution fees and shareholder servicing fees - Class C Shares | 13 | |||
Distribution fees and shareholder servicing fees - Class S Shares | – | |||
Administrative, networking and omnibus fees - Class A Shares | 1 | |||
Administrative, networking and omnibus fees - Class C Shares | 2 | |||
Administrative, networking and omnibus fees - Class I Shares | 1 | |||
Other expenses | – | |||
Non-recurring costs (Note 4) | – | |||
Costs assumed by Janus Capital Management LLC (Note 4) | – | |||
Total Expenses | 68 | |||
Expense and Fee Offset | – | |||
Net Expenses | 68 | |||
Less: Excess Expense Reimbursement | (36) | |||
Net Expenses after Expense Reimbursement | 32 | |||
Net Investment Income | 104 | |||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||
Net realized gain from investment and foreign currency transactions(2) | 94 | |||
Capital gain distributions from Underlying Funds | 1 | |||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 869 | |||
Net Gain on Investments | 964 | |||
Net Increase in Net Assets Resulting from Operations | $ | 1,068 |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Includes realized gain/(loss) from affiliated investment companies. See Note 4 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Asset Allocation Fund | 13
Table of Contents
Statements of Changes in Net Assets
For the six-month period ended December 31, 2010 (unaudited), the eleven-month fiscal period | Janus Dynamic | |||||||||||
ended June 30, 2010 and the fiscal period ended July 31, 2009 | Allocation Fund(1) | |||||||||||
(all numbers in thousands) | 2010 | 2010(2) | 2009(3) | |||||||||
Operations: | ||||||||||||
Net investment income | $ | 104 | $ | 54 | $ | 56 | ||||||
Net realized gain/(loss) from investment and foreign currency transactions(4) | 94 | 174 | (192) | |||||||||
Capital gain distribution from Underlying Funds | 1 | 2 | 33 | |||||||||
Net realized gain from swap contracts | – | – | – | |||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 869 | 41 | 364 | |||||||||
Net Increase in Net Assets Resulting from Operations | 1,068 | 271 | 261 | |||||||||
Dividends and Distributions to Shareholders: | ||||||||||||
Net Investment Income* | ||||||||||||
Class A Shares | (49) | (31) | (3) | |||||||||
Class C Shares | (23) | (23) | (6) | |||||||||
Class I Shares | (20) | (14) | (3) | |||||||||
Class S Shares | (4) | (3) | (2) | |||||||||
Class T Shares | (3) | – | – | |||||||||
Net Realized Gain/(Loss) from Investment Transactions* | ||||||||||||
Class A Shares | (83) | (6) | – | |||||||||
Class C Shares | (73) | (4) | – | |||||||||
Class I Shares | (33) | (2) | – | |||||||||
Class S Shares | (8) | (1) | – | |||||||||
Class T Shares | (5) | – | – | |||||||||
Net Decrease from Dividends and Distributions | (301) | (84) | (14) | |||||||||
Capital Share Transactions: | ||||||||||||
Shares Sold | ||||||||||||
Class A Shares | 183 | 1,786 | 1,670 | |||||||||
Class C Shares | 529 | 1,719 | 1,190 | |||||||||
Class I Shares | 174 | 1,479 | 740 | |||||||||
Class S Shares | 22 | 87 | 494 | |||||||||
Class T Shares | 180 | 56 | 1 | |||||||||
Reinvested Dividends and Distributions | ||||||||||||
Class A Shares | 129 | 37 | 3 | |||||||||
Class C Shares | 88 | 26 | 6 | |||||||||
Class I Shares | 53 | 16 | 3 | |||||||||
Class S Shares | 12 | 3 | 2 | |||||||||
Class T Shares | 8 | – | – | |||||||||
Shares Repurchased | ||||||||||||
Class A Shares | (280) | (574) | (28) | |||||||||
Class C Shares | (326) | (636) | (22) | |||||||||
Class I Shares | (362) | (960) | (3) | |||||||||
Class S Shares | (18) | (283) | (40) | |||||||||
Class T Shares | (12) | (16) | – | |||||||||
Net Increase from Capital Share Transactions | 380 | 2,740 | 4,016 | |||||||||
Net Increase in Net Assets | 1,147 | 2,927 | 4,263 | |||||||||
Net Assets: | ||||||||||||
Beginning of period | 7,190 | 4,263 | – | |||||||||
End of period | $ | 8,337 | $ | 7,190 | $ | 4,263 | ||||||
Undistributed Net Investment Income* | $ | 29 | $ | 24 | $ | 42 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from September 3, 2008 (inception date) through July 31, 2009. | |
(4) | Includes realized gain/(loss) from affiliated investment companies. See affiliates table in Notes to Schedules of Investments. |
See Notes to Financial Statements.
14 | DECEMBER 31, 2010
Table of Contents
Financial Highlights
Class A Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Janus Dynamic Allocation Fund(1) | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(2) | 2009(3) | |||||||||||
Net Asset Value, Beginning of Period | $9.20 | $8.76 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .15 | .07 | .15 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.26 | .49 | (1.31) | |||||||||||
Total from Investment Operations | 1.41 | .56 | (1.16) | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.15) | (.10) | (.08) | |||||||||||
Distributions (from capital gains)* | (.26) | (.02) | – | |||||||||||
Total Distributions and Other | (.41) | (.12) | (.08) | |||||||||||
Net Asset Value, End of Period | $10.20 | $9.20 | $8.76 | |||||||||||
Total Return** | 15.29% | 6.27% | (11.38)% | |||||||||||
Net Assets, End of Period (in thousands) | $3,421 | $3,059 | $1,734 | |||||||||||
Average Net Assets for the Period (in thousands) | $3,279 | $2,956 | $488 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.60% | 0.45% | 0.62% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.60% | 0.45% | 0.61% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.92% | 1.13% | 3.35% | |||||||||||
Portfolio Turnover Rate*** | 52% | 51% | 78% |
Class C Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Janus Dynamic Allocation Fund(1) | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(2) | 2009(3) | |||||||||||
Net Asset Value, Beginning of Period | $9.11 | $8.74 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .10 | (.01) | .19 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.26 | .50 | (1.37) | |||||||||||
Total from Investment Operations | 1.36 | .49 | (1.18) | |||||||||||
Less Distributions: | ||||||||||||||
Dividends (from net investment income)* | (.08) | (.10) | (.08) | |||||||||||
Distributions (from capital gains)* | (.26) | (.02) | – | |||||||||||
Total Distributions and Other | (.34) | (.12) | (.08) | |||||||||||
Net Asset Value, End of Period | $10.13 | $9.11 | $8.74 | |||||||||||
Total Return** | 14.91% | 5.47% | (11.58)% | |||||||||||
Net Assets, End of Period (in thousands) | $2,975 | $2,429 | $1,288 | |||||||||||
Average Net Assets for the Period (in thousands) | $2,555 | $2,168 | $684 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.32% | 1.22% | 0.48%(5) | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.32% | 1.21% | 0.48%(5) | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.23% | 0.34% | 3.37% | |||||||||||
Portfolio Turnover Rate*** | 52% | 51% | 78% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from September 3, 2008 (inception date) through July 31, 2009. | |
(4) | See Note 6 in Notes to Financial Statements. | |
(5) | Pursuant to a contractual agreement, Janus waived certain fees and expenses during the period. The Ratio of Gross Expenses to Average Net Assets and Ratio of Net Expenses to Average Net Assets would be 1.46% and 1.45%, respectively, without the waiver of these fees and expenses. |
See Notes to Financial Statements.
Janus Asset Allocation Fund | 15
Table of Contents
Financial Highlights (continued)
Class I Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Janus Dynamic Allocation Fund(1) | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(2) | 2009(3) | |||||||||||
Net Asset Value, Beginning of Period | $9.22 | $8.79 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .16 | .05 | .19 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.26 | .50 | (1.32) | |||||||||||
Total from Investment Operations | 1.42 | .55 | (1.13) | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.15) | (.10) | (.08) | |||||||||||
Distributions (from capital gains)* | (.26) | (.02) | – | |||||||||||
Total Distributions and Other | (.41) | (.12) | (.08) | |||||||||||
Net Asset Value, End of Period | $10.23 | $9.22 | $8.79 | |||||||||||
Total Return** | 15.41% | 6.13% | (11.08)% | |||||||||||
Net Assets, End of Period (in thousands) | $1,382 | $1,371 | $782 | |||||||||||
Average Net Assets for the Period (in thousands) | $1,374 | $1,332 | $382 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.48% | 0.46% | 0.46% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.48% | 0.45% | 0.45% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.88% | 1.12% | 3.57% | |||||||||||
Portfolio Turnover Rate*** | 52% | 51% | 78% |
Class S Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Janus Dynamic Allocation Fund(1) | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(2) | 2009(3) | |||||||||||
Net Asset Value, Beginning of Period | $9.17 | $8.75 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .13 | .15 | .19 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.27 | .39 | (1.36) | |||||||||||
Total from Investment Operations | 1.40 | .54 | (1.17) | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.12) | (.10) | (.08) | |||||||||||
Distributions (from capital gains)* | (.26) | (.02) | – | |||||||||||
Total Distributions and Other | (.38) | (.12) | (.08) | |||||||||||
Net Asset Value, End of Period | $10.19 | $9.17 | $8.75 | |||||||||||
Total Return** | 15.25% | 6.04% | (11.48)% | |||||||||||
Net Assets, End of Period (in thousands) | $342 | $292 | $458 | |||||||||||
Average Net Assets for the Period (in thousands) | $323 | $355 | $274 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.70% | 0.75% | 0.72% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.70% | 0.74% | 0.71% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.78% | 0.79% | 3.09% | |||||||||||
Portfolio Turnover Rate*** | 52% | 51% | 78% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from September 3, 2008 (inception date) through July 31, 2009. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
16 | DECEMBER 31, 2010
Table of Contents
Class T Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Janus Dynamic Allocation Fund(1) | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(2) | 2009(3) | |||||||||||
Net Asset Value, Beginning of Period | $9.21 | $8.78 | $8.25 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .13 | .09 | .01 | |||||||||||
Net gain on investments (both realized and unrealized) | 1.28 | .46 | .52 | |||||||||||
Total from Investment Operations | 1.41 | .55 | .53 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.16) | (.10) | – | |||||||||||
Distributions (from capital gains)* | (.26) | (.02) | – | |||||||||||
Total Distributions and Other | (.42) | (.12) | – | |||||||||||
Net Asset Value, End of Period | $10.20 | $9.21 | $8.78 | |||||||||||
Total Return** | 15.24% | 6.14% | 6.42% | |||||||||||
Net Assets, End of Period (in thousands) | $217 | $39 | $1 | |||||||||||
Average Net Assets for the Period (in thousands) | $105 | $27 | $1 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.74% | 0.47% | 0.76% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.74% | 0.46% | 0.70% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 4.88% | 0.97% | 1.56% | |||||||||||
Portfolio Turnover Rate*** | 52% | 51% | 78% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from July 6, 2009 (inception date) through July 31, 2009. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Asset Allocation Fund | 17
Table of Contents
Notes to Schedules of Investments (unaudited)
Barclays Capital U.S. Aggregate Bond Index | An unmanaged market value weighted index for U.S. dollar-denominated investment-grade debt issues, including government, corporate, mortgage-backed, and asset-backed securities with maturities of at least one year. | |
Dynamic Allocation Composite Index | A hypothetical combination of unmanaged indices. This internally-calculated index combines the total returns from the Russell 3000® Index (50%), the Barclays Capital U.S. Aggregate Bond Index (25%), and the Morgan Stanley Capital International All Country World ex-U.S. IndexSM (25%). | |
Lipper Mixed-Asset Target Allocation Growth Funds | The Lipper Mixed-Asset Target Allocation Growth Funds Average represents the average annual returns for all Mixed-Asset Target Allocation Growth Funds for the respective time periods. | |
Morgan Stanley Capital International All Country World ex-U.S. IndexSM | An unmanaged, free float-adjusted, market capitalization weighted index composed of stocks of companies located in countries throughout the world, excluding the United States. It is designed to measure equity market performance in global developed and emerging markets outside the United States. The index includes reinvestment of dividends, net of foreign withholding taxes. | |
Russell 3000® Index | Measures the performance of the stocks of the 3,000 largest publicly-traded U.S. companies, based on market capitalization, and it measures the performance of about 98% of the total market capitalization of the publicly traded U.S. equity market. | |
ETF | Exchange-Traded Fund |
The following is a summary of the inputs that were used to value the Fund’s investments in securities and other financial instruments as of December 31, 2010. See Notes to Financial Statements for more information.
Valuation Inputs Summary (as of December 31, 2010)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Janus Dynamic Allocation Fund(1) | |||||||||||
Exchange-Traded Funds | $ | 622,272 | $ | – | $ | – | |||||
Mutual Funds | |||||||||||
Equity Funds | – | 5,705,889 | – | ||||||||
Fixed-Income Funds | – | 1,774,396 | – | ||||||||
Money Market | – | 266,847 | – | ||||||||
Total Investments in Securities | $ | 622,272 | $ | 7,747,132 | $ | – | |||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
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Notes to Financial Statements (unaudited)
The following section describes the organization and significant accounting policies and provides more detailed information about the schedules and tables that appear throughout this report. In addition, the Notes to Financial Statements explain the methods used in preparing and presenting this report.
1. | Organization and Significant Accounting Policies |
Janus Dynamic Allocation Fund (formerly named Janus Modular Portfolio Construction® Fund) is a series fund. The Fund operates as a “fund of funds,” meaning substantially all of the Fund’s assets will be invested in other Janus funds (the “underlying funds”) with approximately 90% of its assets allocated to Janus-managed mutual funds and approximately 10% allocated to unqualified pooled investment vehicles (e.g., ETFs) and derivatives. The Fund is part of Janus Investment Fund (the “Trust”), which is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The financial statements include information for the six-month period ended December 31, 2010. The Trust offers forty funds which include multiple series of shares, with differing investment objectives and policies. The Fund is classified as diversified, as defined in the 1940 Act.
The Fund in this report offers multiple classes of shares in order to meet the needs of various types of investors. Each class represents an interest in the same portfolio of investments. Certain financial intermediaries may not offer all classes of shares. The share classes in this report are not offered directly to individual investors.
Class A Shares and Class C Shares are generally offered through financial intermediary platforms including, but not limited to, traditional brokerage platforms, mutual fund wrap fee programs, bank trust platforms, and retirement platforms. The maximum purchase in Class C Shares is $500,000 for any single purchase.
Class I Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, and bank trust platforms, as well as certain retirement platforms. Class I Shares are also available to certain institutional investors including, but not limited to, corporations, certain retirement plans, public plans, and foundations/endowments.
Class S Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms and asset allocation, mutual fund wrap, or other discretionary or nondiscretionary fee-based investment advisory programs. In addition, Class S Shares may be available through certain financial intermediaries who have an agreement with Janus Capital Management LLC (“Janus Capital”) or its affiliates to offer Class S Shares on their supermarket platforms.
Class T Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, bank trust platforms, and certain retirement platforms. In addition, Class T Shares may be available through certain financial intermediaries who have an agreement with Janus Capital or its affiliates to offer Class T Shares on their supermarket platforms.
Underlying Funds
The Fund invests in a variety of underlying funds to pursue a target allocation of stocks and bonds, and may also invest in money market instruments or cash/cash equivalents. The Fund has a target allocation, which is how the Fund’s investments generally will be allocated among the major asset classes over the long term, as well as normal ranges within which the Fund’s asset class allocations generally will vary over short-term periods. The normal asset allocation ranges are as follows: 60%-90% stocks, 15%-30% bonds and money market instruments and 5-15% alternative investments for the Fund. A brief description of each of the underlying funds that the Fund may invest in are as follows.
POTENTIAL UNDERLYING FUNDS INVESTING PRIMARILY IN EQUITY SECURITIES
INTECH RISK-MANAGED CORE FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the S&P 500® Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
INTECH RISK-MANAGED GROWTH FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Russell 1000® Growth Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
INTECH RISK-MANAGED INTERNATIONAL FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Morgan Stanley Capital International (“MSCI”) EAFE® (Europe, Australasia, Far East) Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
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Notes to Financial Statements (unaudited) (continued)
INTECH RISK-MANAGED VALUE FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Russell 1000® Value Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
JANUS BALANCED FUND seeks long-term capital growth, consistent with preservation of capital and balanced by current income. The fund pursues its investment objective by normally investing 35-65% of its assets in equity securities and the remaining assets in fixed-income securities and cash equivalents. The fund normally invests at least 25% of its assets in fixed-income senior securities. Fixed-income securities may include corporate debt securities, U.S. Government obligations, mortgage-backed securities and other mortgage-related products, and short-term investments.
JANUS CONTRARIAN FUND seeks long-term growth of capital. The fund pursues its investment objective by investing, under normal circumstances, at least 80% of its net assets in equity securities with the potential for long-term growth of capital. The portfolio manager emphasizes investments in companies with attractive price/free cash flow, which is the relationship between the price of a stock and the company’s available cash from operations minus capital expenditures. The portfolio manager will typically seek attractively valued companies that are improving their free cash flow and returns on invested capital. Such companies may also include special situations companies that are experiencing management changes and/or are currently out of favor.
JANUS EMERGING MARKETS FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of issuers in emerging market countries. The fund normally invests in securities of issuers that (i) are primarily listed on the trading market of an emerging market country; (ii) are incorporated or have their principal business activities in an emerging market country; or (iii) derive 50% or more of their revenues from, or have 50% or more of their assets in, an emerging market country. An emerging market country is any country that has been determined by an international organization, such as the World Bank, to have a low to middle income economy and/or any country that is not included in the Morgan Stanley Capital International World Index, which measures the equity market performance of developed markets. The fund generally invests in equity securities, which consist primarily of common stocks, preferred stocks and convertible securities, but may also invest in other types of instruments, such as equity-linked securities.
JANUS ENTERPRISE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential and normally invests at least 50% of its equity assets in medium-sized companies. Medium-sized companies are those whose market capitalization falls within the range of companies in the Russell Midcap® Growth Index.
JANUS FORTY FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 20-40 common stocks selected for their growth potential. The fund may invest in companies of any size, from larger, well-established companies to smaller, emerging growth companies.
JANUS FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. Although the fund may invest in companies of any size, it generally invests in larger, more established companies.
JANUS GLOBAL LIFE SCIENCES FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of companies that the portfolio manager believes have a life science orientation. Generally speaking, the “life sciences” relate to maintaining or improving quality of life. The fund implements this policy by investing primarily in equity securities of U.S. and foreign companies selected for their growth potential. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. As a fundamental policy, the fund normally invests at least 25% of its total assets in the “life sciences” sector, which may include companies in the following industry groups: health care; pharmaceuticals; agriculture; cosmetics/personal care; and biotechnology. The fund may have significant exposure to emerging markets.
JANUS GLOBAL RESEARCH FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. The fund may invest in companies of any size located anywhere in the world, from larger, well-established companies to smaller, emerging growth companies. The fund normally invests at least 40% of its net assets in securities of issuers from different countries located throughout the world, excluding the United States. The fund may have significant exposure to emerging markets.
JANUS GLOBAL SELECT FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 30-50
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domestic and foreign common stocks selected for their growth potential and normally investing at least 40% of its net assets in securities of issuers from different countries located throughout the world, excluding the United States. The fund may invest in companies of any size, located anywhere in the world, from larger, well-established companies to smaller, emerging growth companies. The fund may also invest in U.S. and foreign debt securities. The fund may have significant exposure to emerging markets.
JANUS GLOBAL TECHNOLOGY FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of companies that the portfolio manager believes will benefit significantly from advances or improvements in technology. These companies generally fall into two categories: (i) companies that the portfolio manager believes have or will develop products, processes, or services that will provide significant technological advancements or improvements and (ii) companies that the portfolio manager believes rely extensively on technology in connection with their operations or services. The fund implements this policy by investing primarily in equity securities of U.S. and foreign companies selected for their growth potential. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
JANUS GROWTH AND INCOME FUND seeks long-term capital growth and current income. The fund pursues its investment objective by normally emphasizing investments in common stocks. The fund will normally invest up to 75% of its assets in equity securities selected primarily for their growth potential and at least 25% of its assets in securities the portfolio manager believes have income potential. Eligible equity securities in which the fund may invest include: (i) domestic and foreign common stocks; (ii) preferred stocks; (iii) securities convertible into common stocks or preferred stocks, such as convertible preferred stocks, bonds, and debentures; and (iv) other securities with equity characteristics.
JANUS INTERNATIONAL EQUITY FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in equity securities. The fund normally invests in a core group of 60-100 equity securities of issuers from different countries located throughout the world, excluding the United States. The fund may, under unusual circumstances, invest all of its assets in a single country. The fund may invest in emerging markets but will normally limit such investments to 20% of its net assets, measured at the time of purchase. The fund may also invest in foreign debt securities.
JANUS OVERSEAS FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of issuers from countries outside of the United States. The fund normally invests in securities of issuers from several different countries, excluding the United States. Although the fund intends to invest substantially all of its assets in issuers located outside the United States, it may at times invest in U.S. issuers, and it may, under unusual circumstances, invest all of its assets in a single country. The fund may have significant exposure to emerging markets.
JANUS RESEARCH CORE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in equity securities selected for their growth potential. Eligible equity securities in which the fund may invest include: (i) domestic and foreign common stocks; (ii) preferred stocks; (iii) securities convertible into common stocks or preferred stocks, such as convertible preferred stocks, bonds, and debentures; and (iv) other securities with equity characteristics (including the use of derivatives). The fund may invest in companies of any size. Effective January 28, 2011, Janus Research Core Fund merged into Janus Growth and Income Fund.
JANUS RESEARCH FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. The fund may invest in companies of any size, from larger, well-established companies to smaller, emerging growth companies.
JANUS TRITON FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. In pursuing that objective, the fund invests in equity securities of small- and medium-sized companies. Generally, small- and medium-sized companies have a market capitalization of less than $10 billion. Market capitalization is a commonly used measure of the size and value of a company.
JANUS TWENTY FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 20-30 common stocks selected for their growth potential.
JANUS VENTURE FUND seeks capital appreciation. The fund pursues its investment objective by investing at least 50% of its equity assets in small-sized companies. Small-sized companies are those who have market capitalizations of less than $1 billion or annual gross revenues of less than $500 million. Companies whose
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Notes to Financial Statements (unaudited) (continued)
capitalization or revenues fall outside these ranges after the fund’s initial purchase continue to be considered small-sized. The fund may also invest in larger companies with strong growth potential or relatively well-known and large companies with potential for capital appreciation.
JANUS WORLDWIDE FUND seeks long-term growth of capital in a manner consistent with the preservation of capital. The fund pursues its investment objective by investing primarily in common stocks of companies of any size located throughout the world. The fund normally invests in issuers from several different countries, including the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
PERKINS GLOBAL VALUE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks of companies of any size located throughout the world with the potential for long-term growth of capital. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
PERKINS LARGE CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in common stocks selected for their capital appreciation potential. The fund primarily invests in the common stocks of large-sized companies whose stock prices the portfolio managers believe to be undervalued. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of companies having, at the time of purchase, market capitalizations equal to or greater than the median market capitalization of companies included in the Russell 1000® Value Index.
PERKINS MID CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in common stocks selected for their capital appreciation potential. The fund primarily invests in the common stocks of mid-sized companies whose stock prices the portfolio managers believe to be undervalued. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of companies whose market capitalization falls, at the time of purchase, within the 12-month average of the capitalization range of the Russell Midcap® Value Index.
PERKINS SMALL CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in the common stocks of small companies whose stock prices are believed to be undervalued by the fund’s portfolio managers. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of small companies whose market capitalization, at the time of initial purchase, is less than the 12-month average of the maximum market capitalization for companies included in the Russell 2000® Value Index.
PERKINS VALUE PLUS INCOME FUND seeks capital appreciation and current income. The fund pursues its investment objective by normally investing 40-60% of its assets in equity securities selected primarily for capital appreciation and investing the remainder in fixed-income securities and cash equivalents. The fund’s equity investments generate total return from a combination of capital appreciation and, to a lesser degree, current income. Such equity investments may include companies of any size, but the fund will invest primarily in large- and mid-sized companies whose stock prices the portfolio managers believe to be undervalued or have the potential for high relative dividend yields, or both. The fund’s fixed-income investments generate total return from a combination of current income and capital appreciation, but income is usually the dominant portion. The fund normally invests the portion of its assets allocated to fixed-income investments in debt securities (including, but not limited to, government bonds, corporate bonds, mortgage-backed securities, and zero-coupon bonds), convertible securities, and short-term securities. The fund invests at least 50% of the fixed-income portion of its assets in investment grade debt securities. The fund will limit its investment in high-yield/high-risk bonds, also known as “junk” bonds, to 50% or less of the fixed-income portion of its net assets.
POTENTIAL UNDERLYING FUNDS INVESTING PRIMARILY IN FIXED-INCOME SECURITIES
JANUS FLEXIBLE BOND FUND seeks to obtain maximum total return, consistent with preservation of capital. The fund pursues its investment objective by primarily investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The fund will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The fund will limit its investment in high-yield/high-risk bonds to 35% or less of its net assets. The fund generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.
JANUS GLOBAL BOND FUND seeks total return, consistent with preservation of capital. The fund pursues its investment objective by investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, corporate bonds, government bonds, convertible bonds, mortgage-backed
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securities, and zero-coupon bonds. The fund invests in corporate debt securities of issuers in a number of different countries, which may include the United States. The fund invests in securities of issuers located in developed and emerging market countries. The fund may invest across all fixed-income sectors, including U.S. and non-U.S. government securities. The fund’s investments may be denominated in local currency or U.S. dollar-denominated. The fund may invest in debt securities with a range of maturities from short- to long-term. The fund may invest up to 35% of its net assets in high-yield/high-risk debt securities. The fund may also invest in preferred and common stock, money market instruments, municipal bonds, commercial and residential mortgage-backed securities, asset-backed securities, other securitized and structured debt products, private placements, and other investment companies, including exchange-traded funds (“ETFs”). The fund may also invest in floating rate loans, buy backs or dollar rolls, and reverse repurchase agreements.
JANUS HIGH-YIELD FUND seeks to obtain high current income. Capital appreciation is a secondary investment objective when consistent with its primary objective. The fund pursues its investment objectives by investing, under normal circumstances, at least 80% of its net assets in high-yield/high-risk securities rated below investment grade. Securities rated below investment grade may include their unrated equivalents or other high-yielding securities the portfolio managers believe offer attractive risk/return characteristics. The fund may at times invest all of its assets in such securities.
JANUS SHORT-TERM BOND FUND seeks as high a level of current income as is consistent with preservation of capital. The fund invests, under normal circumstances, at least 80% of its net assets in short- and intermediate-term securities such as corporate bonds or notes or government securities, including agency securities. The fund may invest up to 35% of its net assets in high-yield/high-risk bonds. The fund expects to maintain an average-weighted effective maturity of three years or less under normal circumstances.
POTENTIAL UNDERLYING FUNDS PRIMARILY UTILIZING ALTERNATIVE STRATEGIES
JANUS GLOBAL REAL ESTATE FUND seeks total return through a combination of capital appreciation and current income. The fund invests, under normal circumstances, at least 80% of its net assets plus the amount of any borrowings for investment purposes in equity and debt securities of real estate-related companies. Such companies may include those in the real estate industry or real estate-related industries. These securities may include common stocks, preferred stocks, and other equity securities, including, but not limited to, real estate investment trusts (“REITs”) and similar REIT-like entities. As a fundamental policy, the fund will concentrate 25% or more of its net assets in securities of issuers in real estate or real estate-related industries. The fund’s investment in companies engaged in businesses outside the real estate industry which possess significant real estate holdings will be deemed to be in the real estate industry for purposes of the fund’s investment objective and its policy on industry concentration. The fund expects under normal market conditions to maintain investments in issuers from several different developed countries, including the United States. Under unusual circumstances, the fund may invest all of its assets in a single country. The fund may invest in emerging markets but will normally limit such investments to 15% of its net assets, measured at the time of purchase.
JANUS LONG/SHORT FUND seeks long-term capital appreciation with an emphasis on absolute returns. Under normal circumstances, the fund generally pursues its investment objective by taking both long and short positions in domestic and foreign equity securities, including those in emerging markets, and exchange-traded funds (“ETFs”) that invest primarily in equity securities. The fund’s portfolio managers believe that a combination of long and short positions may provide positive returns regardless of market conditions through a complete market cycle and may offer reduced risk. The fund will generally buy long securities that the portfolio managers believe will go up in price and will sell short ETFs and other equity securities the portfolio managers believe will go down in price. The fund may, to a lesser degree, also take long and short positions in instruments that provide additional exposure to the equity markets, including options, futures, and other index-based instruments. The fund’s investments may include holdings across different industries, sectors, and regions.
The following accounting policies have been followed by the Fund and are in conformity with accounting principles generally accepted in the United States of America within the investment management industry.
Investment Valuation
The Fund’s net asset value (“NAV”) is partially calculated based upon the NAV of each of the underlying funds in which the Fund invests on the day of valuation. The NAV for each class of an underlying fund is computed by dividing the total value of securities and other assets allocated to the class, less liabilities allocated to that class, by the total number of shares outstanding for the class.
Securities held by the Fund and the underlying funds are valued at the last sales price or the official closing price for securities traded on a principal securities exchange
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Notes to Financial Statements (unaudited) (continued)
(U.S. or foreign) and on the NASDAQ National Market. Securities held by the Fund and the underlying funds traded on over-the-counter (“OTC”) markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Fund’s and the underlying funds’ Trustees. Short-term securities held by the Fund and the underlying funds with maturities of 60 days or less may be valued at amortized cost, which approximates market value. Debt securities held by the Fund and the underlying funds with a remaining maturity of greater than 60 days are valued in accordance with the evaluated bid price supplied by the pricing service. The evaluated bid price supplied by the pricing service is an evaluation that reflects such factors as security prices, yields, maturities and ratings. Short positions shall be valued in accordance with the same methodologies, except that in the event that a last sale price is not available, the latest ask price shall be used instead of a bid price. Foreign securities and currencies held by the Fund and the underlying funds are converted to U.S. dollars using the applicable exchange rate in effect as of the daily close of the New York Stock Exchange (“NYSE”). When market quotations are not readily available or deemed unreliable, or events or circumstances that may affect the value of portfolio securities held by the Fund and the underlying funds are identified between the closing of their principal markets and the time the NAV is determined, securities may be valued at fair value as determined in good faith under procedures established by and under the supervision of the Fund’s and the underlying funds’ Trustees. Circumstances in which fair value pricing may be utilized include, but are not limited to: (i) a significant event that may affect the securities of a single issuer, such as a merger, bankruptcy, or significant issuer specific development; (ii) an event that may affect an entire market, such as a natural disaster or significant governmental action; (iii) a nonsignificant event such as a market closing early or not opening, or a security trading halt; and (iv) pricing of a non-valued security and a restricted or non-public security. The Fund and underlying funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. Restricted and illiquid securities are valued in accordance with procedures established by the Fund’s and the underlying funds’ Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from foreign securities held by the Fund and the underlying funds will be recorded as soon as the Trust is informed of the dividend, if such information is obtained subsequent to the ex-dividend date. Dividends from foreign securities may be subject to withholding taxes in foreign jurisdictions. Interest income of the Fund and the underlying funds is recorded on the accrual basis and includes amortization of premiums and accretion of discounts. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes. Income, as well as gains and losses, both realized and unrealized, are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets.
Expenses
The Fund bears expenses incurred specifically on its behalf, as well as a portion of general expenses, which may be allocated pro rata to the Fund. Additionally, the Fund as a shareholder in the underlying funds, will also indirectly bear its pro rata share of the expenses incurred by the underlying funds. Each class of shares bears expenses incurred specifically on its behalf and, in addition, each class bears a portion of general expenses, which are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets. Expenses directly attributable to a specific class of shares are charged against the operations of such class.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translations
The underlying funds do not isolate that portion of the results of operations resulting from the effect of changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held at the date of the financial statements. Net unrealized appreciation or depreciation of investments and foreign currency translations arise from changes in the value of assets and liabilities, including investments in securities held at the date of the financial statements, resulting from changes in the exchange rates and changes in market prices of securities held.
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Currency gains and losses of the underlying funds are also calculated on payables and receivables that are denominated in foreign currencies. The payables and receivables are generally related to foreign security transactions and income.
Foreign currency-denominated assets and forward currency contracts of the underlying funds may involve more risks than domestic transactions, including currency risk, political and economic risk, regulatory risk and equity risk. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of foreign currencies relative to the U.S. dollar.
Dividend Distributions
The Fund generally declares and distributes dividends of net investment income and realized capital gains (if any) annually. The majority of dividends and capital gains distributions from the Fund may be automatically reinvested into additional shares of the Fund, based on the discretion of the shareholder.
The underlying funds may make certain investments in REITs which pay dividends to their shareholders based upon funds available from operations. It is quite common for these dividends to exceed the REITs’ taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of capital. If the underlying funds distribute such amounts, such distributions could constitute a return of capital to shareholders for federal income tax purposes.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial statements, as the Fund intends to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code applicable to regulated investment companies.
In accordance with the Financial Accounting Standards Board (“FASB”) guidance, the Fund adopted the provisions of “Income Taxes.” These provisions require an evaluation of tax positions taken (or expected to be taken) in the course of preparing the Fund’s tax return to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Fund recognizes interest and penalties, if any, related to unrecognized tax benefits in income tax expense on the Statements of Operations.
These provisions require management of the Fund to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of and during the period ended December 31, 2010, the Fund did not have a liability for any unrecognized tax benefits. The Fund has no examinations in progress and is not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Valuation Inputs Summary
In accordance with FASB guidance, the Fund utilizes the “Fair Value Measurements” to define fair value, establish a framework for measuring fair value, and expand disclosure requirements regarding fair value measurements. The Fair Value Measurement Standard does not require new fair value measurements, but is applied to the extent that other accounting pronouncements require or permit fair value measurements. This standard emphasizes that fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. Various inputs are used in determining the value of the Fund’s investments defined pursuant to this standard. These inputs are summarized into three broad levels:
Level 1 – Quoted prices in active markets for identical securities.
Level 2 – Prices determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use in pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others.
Debt securities are valued in accordance with the evaluated bid price supplied by the pricing service and generally categorized as Level 2 in the hierarchy. Securities traded on OTC markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Fund’s Trustees and are categorized as Level 2 in the hierarchy. Short-term securities with maturities of 60 days or less are valued at amortized cost, which approximates market value and are categorized as Level 2 in the hierarchy. Other securities that are categorized as Level 2 in the hierarchy include, but are not limited to, preferred stocks, bank loans, American Depositary Receipts
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Notes to Financial Statements (unaudited) (continued)
(ADRs), Global Depositary Receipts (GDRs), warrants, swaps, investments in mutual funds, OTC options, and forward contracts. The Fund may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. These are generally categorized as Level 2 in the hierarchy.
Level 3 – Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the security and would be based on the best information available under the circumstances.
For restricted equity securities and private placements where observable inputs are limited, assumptions about market activity and risk are used in employing valuation techniques such as the market approach, the income approach, or the cost approach, as defined under the FASB Guidance. These are categorized as Level 3 in the hierarchy.
There have been no significant changes in valuation techniques used in valuing any such positions held by the Fund since the beginning of the fiscal year.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of inputs used as of December 31, 2010 to value the Fund’s investments in securities and other financial instruments is included in the “Valuation Inputs Summary” and “Level 3 Valuation Reconciliation of Assets” (if applicable) in the Notes to Schedule of Investments.
In April 2009, FASB issued “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly,” which provides additional guidance for estimating fair value in accordance with Fair Value Measurements when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. Additionally, it amends the Fair Value Measurement Standard by expanding disclosure requirements for reporting entities surrounding the major categories of assets and liabilities carried at fair value. The required disclosures have been incorporated into the “Valuation Inputs Summary” in the Notes to Schedule of Investments. Management believes applying this guidance does not have a material impact on the financial statements.
The Fund adopted FASB Accounting Standards Update “Fair Value Measurements and Disclosures” (the “Update”), effective December 31, 2010. This Update applies to the Fund’s disclosures about transfers in and out of Level 1 and Level 2 of the fair value hierarchy and the reasons for the transfers. Disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy are summarized under the Level 2 and Level 3 categories listed above. There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period.
The Fund recognizes transfers between the levels as of the beginning of the fiscal year.
2. | Derivative Instruments |
The Fund and underlying funds may invest in various types of derivatives which may at times result in significant derivative exposure. A derivative is a financial instrument whose performance is derived from the performance of another asset. The Fund and underlying funds may invest in derivative instruments including, but not limited to: futures contracts, put options, call options, options on future contracts, options on foreign currencies, swaps, forward contracts, structured investments, and other equity-linked derivatives. A summary of derivative activity is reflected in the tables at the end of this section.
The Fund and underlying funds may use derivative instruments for hedging (to offset risks associated with an investment, currency exposure, or market conditions) or for speculative (to seek to enhance returns) purposes. When the Fund and underlying funds invest in a derivative for speculative purposes, the Fund or underlying funds will be fully exposed to the risks of loss of that derivative, which may sometimes be greater than the cost of the derivative. The Fund and underlying funds may not use any derivative to gain exposure to an asset or class of assets prohibited by their investment restrictions from purchasing directly. The Fund’s or an underlying fund’s ability to use derivative instruments may also be limited by tax considerations.
Investments in derivatives are generally subject to equity risks that may cause their prices to fluctuate over time. Investments in derivatives may not directly correlate with the price movements of the underlying instrument. As a result, the use of derivatives may expose the underlying funds to additional risks that they would not be subject to if they invested directly in the securities underlying those derivatives. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case.
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Derivatives can be volatile and may involve significant risks, including, but not limited to, counterparty risk, credit risk, currency risk, equity risk, index risk, interest rate risk, leverage risk, and liquidity risk.
Derivatives may generally be traded OTC or on an exchange. Derivatives traded OTC, such as structured notes, are agreements that are individually negotiated between parties and can be tailored to meet a purchaser’s needs. OTC derivatives are not guaranteed by a clearing agency and may be subject to increased credit risk.
In an effort to mitigate credit risk associated with derivatives traded OTC, the Fund and certain underlying funds may enter into collateral agreements with certain counterparties whereby, subject to certain minimum exposure requirements, the Fund and certain underlying funds may require the counterparty to post collateral if the Fund or underlying funds have a net aggregate unrealized gain on all OTC derivative contracts with a particular counterparty. There is no guarantee that counterparty exposure is reduced and these arrangements are dependent on Janus Capital’s ability to establish and maintain appropriate systems and trading.
In pursuit of their investment objectives, the Fund and underlying funds may seek to use derivatives to increase or decrease exposure to the following market risk factors:
• | Counterparty Risk – Counterparty risk is the risk that the counterparty or a third party will not fulfill its obligation to the Fund and underlying funds. | |
• | Credit Risk – Credit risk is the risk an issuer will be unable to make principal and interest payments when due, or will default on its obligations. | |
• | Currency Risk – Currency risk is the risk that changes in the exchange rate between currencies will adversely affect the value (in U.S. dollar terms) of an investment. | |
• | Equity Risk – Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market. | |
• | Index Risk – If the derivative is linked to the performance of an index, it will be subject to the risks associated with changes in that index. If the index changes, the Fund could receive lower interest payments or experience a reduction in the value of the derivative to below what the Fund and underlying funds paid. Certain indexed securities, including inverse securities (which move in an opposite direction to the index), may create leverage, to the extent that they increase or decrease in value at a rate that is a multiple of the changes in the applicable index. | |
• | Interest Rate Risk – Interest rate risk is the risk that the value of fixed-income securities will generally decline as prevailing interest rates rise, which may cause the Fund’s and underlying fund’s NAV to likewise decrease, and vice versa. | |
• | Leverage Risk – Leverage risk is the risk associated with certain types of leveraged investments or trading strategies pursuant to which relatively small market movements may result in large changes in the value of an investment. The Fund or underlying funds create leverage by using borrowed capital to increase the amount invested, or investing in instruments, including derivatives, where the investment loss can exceed the original amount invested. Certain investments or trading strategies that involve leverage can result in losses that greatly exceed the amount originally invested. | |
• | Liquidity Risk – Liquidity risk is the risk that certain securities may be difficult or impossible to sell at the time that the seller would like or at the price that the seller believes the security is currently worth. |
Equity-Linked Structured Notes
The underlying funds, except INTECH Risk-Managed Core Fund, INTECH Risk-Managed Growth Fund, INTECH Risk-Managed International Fund, and INTECH Risk-Managed Value Fund (together, the “Risk-Managed funds”), may invest in equity-linked structured notes. Equity-linked structured notes are derivative securities which are specially designed to combine the characteristics of one or more underlying securities and their equity derivatives in a single note form. The return and/or yield or income component may be based on the performance of the underlying equity securities, an equity index, and/or option positions. Equity-linked structured notes are typically offered in limited transactions by financial institutions in either registered or non-registered form. An investment in equity-linked structured notes creates exposure to the credit risk of the issuing financial institution, as well as to the equity risk of the underlying securities. There is no guaranteed return of principal with these securities and the appreciation potential of these securities may be limited by a maximum payment or call right. In certain cases, equity-linked structured notes may be more volatile and less liquid than less complex securities or other types of fixed-income securities. Such securities may exhibit price behavior that does not correlate with other fixed-income securities.
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Notes to Financial Statements (unaudited) (continued)
Forward Foreign Currency Exchange Contracts
A forward foreign currency exchange contract (“forward currency contract”) is a commitment to purchase or sell a foreign currency at a future date at a negotiated rate. The Fund and underlying funds, except the Risk-Managed funds, may enter into forward currency contracts for hedging purposes, including, but not limited to, reducing exposure to changes in foreign currency exchange rates on foreign portfolio holdings of the Fund and underlying funds and locking in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in or exposed to foreign currencies. The Fund and underlying funds may also invest in forward currency contracts for nonhedging purposes such as seeking to enhance returns. The Fund and underlying funds are subject to currency risk in the normal course of pursuing their investment objectives through their investments in forward currency contracts.
The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing a contract is included in “Net realized gain/(loss) from investment and foreign currency transactions” on the Statements of Operations (if applicable).
Forward currency contracts held by the Fund or underlying funds are fully collateralized by other securities, which are denoted on the Fund’s or the underlying funds’ Schedules of Investments (if applicable). The collateral is evaluated daily to ensure its market value equals or exceeds the current market value of the corresponding forward currency contracts. Such collateral is in the possession of the Fund’s or underlying funds’ custodian.
Futures Contracts
A futures contract is an exchange-traded agreement to take or make delivery of an underlying asset at a specific time in the future for a specific predetermined negotiated price. The Fund and underlying funds may enter into futures contracts to gain exposure to the stock market pending investment of cash balances or to meet liquidity needs. The Fund and underlying funds are subject to interest rate risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in futures contracts. The Fund and underlying funds may also use such derivative instruments to hedge or protect from adverse movements in securities prices, currency rates or interest rates. The use of futures contracts may involve risks such as the possibility of illiquid markets or imperfect correlation between the values of the contracts and the underlying securities, or that the counterparty will fail to perform its obligations.
Futures contracts are marked-to-market daily, and the daily variation margin is recorded as a receivable or payable on the Statement of Assets and Liabilities (if applicable). When a contract is closed, a realized gain or loss is recorded as “Net realized gain/(loss) from futures contracts” on the Statements of Operations (if applicable), equal to the difference between the opening and closing value of the contract. Generally, futures contracts are marked-to-market (i.e., treated as realized and subject to distribution) for federal income tax purposes at fiscal year-end. Securities held by the Fund or an underlying fund that are designated as collateral for market value on futures contracts are noted on the Schedule of Investments (if applicable). Such collateral is in the possession of the Fund’s or the underlying fund’s custodian or with the counterparty broker.
With futures, there is minimal counterparty credit risk to the Fund and underlying funds since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Options Contracts
An options contract provides the purchaser with the right, but not the obligation, to buy (call option) or sell (put option) a financial instrument at an agreed upon price. The Fund and underlying funds may purchase or write covered and uncovered put and call options on futures contracts and on portfolio securities for hedging purposes or as a substitute for an investment. The Fund or underlying funds are subject to interest rate risk, liquidity risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in options contracts. The Fund or underlying funds may use options contracts to hedge against changes in interest rates, the values of equities, or foreign currencies. The Fund and underlying funds may utilize American-style and European-style options. An American-style option is an option contract that can be exercised at any time between the time of purchase and the option’s expiration date. A European-style option is an option contract that can only be exercised on the option’s expiration date. The Fund and underlying funds, except the Risk-Managed funds, may also purchase or write put and call options on foreign currencies in a manner similar to that in which futures or forward contracts on foreign currencies will be utilized. The Fund and underlying funds may also invest in long-term equity anticipation securities, which are long-term option contracts that can be maintained for a period of up to three years. The Fund or underlying funds generally invest in options to hedge against adverse movements in the value of portfolio holdings.
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When an option is written, the Fund or underlying funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. In writing an option, the Fund or underlying funds bear the risk of an unfavorable change in the price of the security underlying the written option. Exercise of an option written by the Fund or underlying funds could result in the Fund or underlying funds buying or selling a security at a price different from the current market value.
When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option are adjusted by the amount of premium received or paid by the Fund or underlying funds.
The Fund or the underlying funds may also purchase and write exchange-listed and OTC put and call options on domestic securities indices, and on foreign securities indices listed on domestic and foreign securities exchanges. Options on securities indices are similar to options on securities except that (1) the expiration cycles of securities index options are monthly, while those of securities options are currently quarterly, and (2) the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a securities index gives the holder the right to receive a cash “exercise settlement amount” equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of exercise, multiplied by (b) a fixed “index multiplier.” Receipt of this cash amount will depend upon the closing level of the securities index upon which the option is based being greater than, in the case of a call, or less than, in the case of a put, the exercise price of the index and the exercise price of the option times a specified multiple. The writer of the option is obligated, in return for the premium received, to make delivery of this amount.
Options traded on an exchange are regulated and the terms of the options are standardized. Options traded OTC expose the Fund or underlying funds to counterparty risk in the event that the counterparty does not perform. This risk is mitigated by having a netting arrangement between the Fund or underlying funds and the counterparty and by having the counterparty post collateral to cover the Fund’s or underlying funds’ exposure to the counterparty.
Holdings of the Fund designated to cover outstanding written options are noted on the Schedule of Investments (if applicable). Options written are reported as a liability on the Statement of Assets and Liabilities as “Options written at value” (if applicable).
Realized gains and losses are reported as “Net realized gain/(loss) from options contracts” on the Statements of Operations (if applicable).
The risk in writing call options is that the Fund or underlying funds give up the opportunity for profit if the market price of the security increases and the options are exercised. The risk in writing put options is that the Fund or underlying funds may incur a loss if the market price of the security decreases and the options are exercised. The risk in buying options is that the Fund or underlying funds pay a premium whether or not the options are exercised. The use of such instruments may involve certain additional risks as a result of unanticipated movements in the market. A lack of correlation between the value of an instrument underlying an option and the asset being hedged, or unexpected adverse price movements, could render the Fund or underlying funds’ hedging strategy unsuccessful. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased or sold. There is no limit to the loss the Fund or underlying funds may recognize due to written call options.
Other Options
In addition to the option strategies described above, the Fund and certain underlying funds may purchase and sell a variety of options with non-standard payout structures or other features (“exotic options”). Exotic options are traded OTC and typically have price movements that can vary markedly from simple put or call options. The risks associated with exotic options are that they cannot be as easily priced and may be subject to liquidity risk. While some exotic options have fairly active markets, others are mostly thinly traded instruments. Some options are pure two-party transactions and may have no liquidity. The Fund and certain underlying funds may treat such instruments as illiquid and will limit their investments in such instruments to no more than 15% of the Fund’s and underlying funds’ net assets, when combined with all other illiquid investments of the Fund and underlying funds. The Fund may use exotic options to the extent that they are consistent with the Fund’s investment objective and investment policies, and applicable regulations.
The Fund and certain underlying funds may purchase and sell exotic options that have values which are determined by the correlation of two or more underlying assets. These types of options include, but are not limited to, outperformance options, yield curve options or other spread options.
Swaps
A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in
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Notes to Financial Statements (unaudited) (continued)
specified prices or rates for a specified amount of an underlying asset. The Fund and the underlying funds, except the Risk-Managed funds, may utilize swap agreements as a means to gain exposure to certain common stocks and/or to “hedge” or protect their portfolios from adverse movements in securities prices or interest rates. The Fund and underlying funds are subject to equity risk and interest rate risk in the normal course of pursuing their investment objectives through investments in swap contracts. Swap agreements entail the risk that a party will default on its payment obligation to the Fund or underlying funds. If the other party to a swap defaults, the Fund or underlying funds would risk the loss of the net amount of the payments that it contractually is entitled to receive. If the Fund or underlying funds utilizes a swap at the wrong time or judges market conditions incorrectly, the swap may result in a loss to the Fund or underlying funds and reduce the Fund’s or underlying funds’ total return. Swap contracts of the Fund are reported as an asset or liability on the Statement of Assets and Liabilities (if applicable). Realized gains and losses of the Fund are reported in “Net realized gain/(loss) from swap contracts” on the Statements of Operations (if applicable).
Various types of swaps such as credit default (funded and unfunded), dividend, equity, interest rate, and total return swaps are described below.
Credit default swaps are a specific kind of counterparty agreement that allows the transfer of third-party credit risk from one party to the other. The Fund or underlying funds are subject to credit risk in the normal course of pursuing their investment objectives through their investments in credit default swap contracts. The Fund or underlying funds may enter into credit default swaps to manage their exposure to the market or certain sectors of the market, to reduce their risk exposure to defaults of corporate and sovereign issuers, or to create exposure to corporate or sovereign issuers to which they are not otherwise exposed. With a credit default swap, one party in the swap is a lender and faces credit risk from a third party, and the counterparty in the credit default swap agrees to insure this risk in exchange for regular periodic payments. The Fund’s or underlying funds’ maximum risk of loss from counterparty risk, either as protection sellers or as protection buyers (undiscounted), is the notional value of the agreement. The risk is mitigated by having a netting arrangement between the Fund or underlying funds and the counterparty and by posting of collateral by the counterparty to the Fund or underlying funds to cover the Fund’s or underlying funds’ exposure to the counterparty.
Funded (notional value of contract paid up front) or unfunded (notional value only paid in case of default) credit default swaps are based on an index of credit default swaps (“CDXs”) or other similarly structured products. CDXs are designed to track segments of the credit default swap market and provide investors with exposure to specific reference baskets of issuers of bonds or loans. These instruments have the potential to allow an investor to obtain the same investment exposure as an investor who invests in an individual credit default swap, but with the potential added benefit of diversification. The CDX reference baskets are normally priced daily and rebalanced every six months in conjunction with leading market makers in the credit industry. The liquidity of the market for CDXs is normally subject to liquidity in the secured loan and credit derivatives markets. The Fund or underlying funds are normally only permitted to take long positions in CDXs.
Dividend swap agreements involve an exchange by the parties of their respective commitments to pay or right to receive the changes in a dividend index point. The underlying funds gain exposure by either paying or receiving an amount in respect of an increase or decrease in the change of the relevant dividend index point based on a notional amount. For example, if the underlying fund took a long position on a dividend index swap, the underlying fund would receive payments if the relevant index point increased in value and would be obligated to pay if that index point decreased in value.
Equity swaps involve the exchange by two parties of future cash flow (e.g., one cash flow based on a referenced interest rate and the other based on the performance of stock or a stock index).
Interest rate swaps involve the exchange by two parties of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments).
Total return swaps involve an exchange by two parties in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income it generates and any capital gains over the payment period.
The Fund’s or underlying funds’ maximum risk of loss for equity swaps, interest rate swaps and total return swaps from counterparty risk or credit risk is the discounted value of the payments to be received from/paid to the counterparty over the contract’s remaining life, to the extent that the amount is positive. The risk is mitigated by having a netting arrangement between the Fund or underlying funds and the counterparty and by the posting of collateral to the Fund or underlying funds to cover the Fund’s or underlying funds’ exposure to the counterparty.
In accordance with FASB guidance, the Fund adopted the provisions for “Derivative and Hedging,” which require
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qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. There were no derivatives held by the Fund during the period ended December 31, 2010.
3. | Other Investments and Strategies |
Additional Investment Risk
The underlying funds, particularly Janus Flexible Bond Fund, Janus Global Bond Fund, Janus High-Yield Fund and Janus Short-Term Bond Fund, may be invested in lower-rated debt securities that have a higher risk of default or loss of value since these securities may be sensitive to economic changes, political changes or adverse developments specific to the issuer. The Risk-Managed funds do not intend to invest in high-yield/high-risk bonds.
Unforeseen events in both domestic and international equity and fixed-income markets have resulted, and may continue to result, in an unusually high degree of volatility in the markets, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. These events and the resulting market upheavals may have an adverse effect on the Fund, such as a decline in the value and liquidity of many securities held by the Fund, unusually high and unanticipated levels of redemptions, an increase in portfolio turnover, a decrease in NAV, and an increase in Fund expenses. Such unforeseen events may make it unusually difficult to identify both investment risks and opportunities and could limit or preclude the Fund’s ability to achieve its investment objective. The market’s behavior may at times be unpredictable. Therefore, it is important to understand that the value of your investment may fall, sometimes sharply, and you could lose money.
Further, the recent instability experienced in the financial markets has resulted in the U.S. Government and various other governmental and regulatory entities taking actions to address the financial crisis. These actions include, but are not limited to, the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in July 2010 which is expected to dramatically change the way in which the U.S. financial system is supervised and regulated. More specifically, the Dodd-Frank Act provides for widespread regulation of financial institutions, consumer financial products and services, broker-dealers, over-the-counter derivatives, investment advisers, credit rating agencies, and mortgage lending, which expands federal oversight in the financial sector and may affect the investment management industry as a whole. Given the broad scope, sweeping nature, and the fact that many provisions of the Dodd-Frank Act must be implemented through future rulemaking, the ultimate impact of the Dodd-Frank Act, and any resulting regulation, is not yet certain. As a result, there can be no assurance that these measures will not have an adverse effect on the value or marketability of securities held by the Fund, including potentially limiting or completely restricting the ability of the Fund to use a particular investment instrument as part of its investment strategy, increasing the costs of using these instruments, or possibly making them less effective in general. Furthermore, no assurance can be made that the U.S. Government or any U.S. regulatory entity (or other authority or regulatory entity) will not continue to take further legislative or regulatory action in response to the economic crisis or otherwise, and the effect of such actions, if taken, cannot be known.
Bank Loans
Certain underlying funds, particularly Janus Balanced Fund, Janus Flexible Bond Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may invest in bank loans, which include institutionally traded floating rate securities generally acquired as an assignment from another holder of, or participation interest in, loans originated by a bank or financial institution (the “Lender”) that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. When investing in a loan participation, the underlying funds have the right to receive payments of principal, interest and any fees to which they are entitled only from the Lender selling the loan agreement and only upon receipt by the Lender of payments from the borrower. The underlying funds generally have no right to enforce compliance with the terms of the loan agreement with the borrower. Assignments and participations involve credit, interest rate, and liquidity risk. Interest rates on floating rate securities adjust with general interest rate changes and/or issuer credit quality. The interest rates paid on a floating rate security in which the underlying funds invest generally are readjusted periodically to an increment over a designated benchmark rate, such as the one-month, three-month, six-month, or one-year London Interbank Offered Rate (“LIBOR”). LIBOR is a short-term interest rate that banks charge one another and is generally representative of the most competitive and current cash rates.
The underlying funds may have difficulty trading assignments and participations to third parties. There may be restrictions on transfer and only limited opportunities may exist to sell such securities in secondary markets. As a result, the underlying funds may be unable to sell assignments or participations at the desired time or may be able to sell only at a price less than fair market value.
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Notes to Financial Statements (unaudited) (continued)
The underlying funds utilize an independent third party to value individual bank loans on a daily basis.
Borrowing
The underlying Janus Long/Short Fund may borrow money from banks for investment purposes to the extent permitted by the 1940 Act. This practice is known as leverage. Currently, under the 1940 Act, Janus Long/Short Fund may borrow from banks up to one-third of its total assets (including the amount borrowed) provided that it maintains continuous asset coverage of 300% with respect to such borrowings and sells (within three days) sufficient portfolio holdings to restore such coverage if it should decline to less than 300% due to market fluctuations or otherwise, even if disadvantageous from an investment standpoint. Janus Long/Short Fund may also borrow money to meet redemptions in order to avoid forced, unplanned sales of portfolio securities or for other temporary or emergency purposes. This allows Janus Long/Short Fund greater flexibility to buy and sell portfolio securities for investment or tax considerations, rather than for cash flow considerations.
The use of borrowing by Janus Long/Short Fund involves special risk considerations that may not be associated with other funds that may only borrow for temporary or emergency purposes. Because substantially all of Janus Long/Short Fund’s assets fluctuate in value, whereas the interest obligation resulting from a borrowing will be fixed by the terms of Janus Long/Short Fund’s agreement with its lender, the NAV per share of Janus Long/Short Fund will tend to increase more when its portfolio securities increase in value and decrease more when its portfolio securities decrease in value than would otherwise be the case if Janus Long/Short Fund did not borrow funds. In addition, interest costs on borrowings may fluctuate with changing market rates of interest and may partially offset or exceed the return earned on borrowed funds. Under adverse market conditions, Janus Long/Short Fund might have to sell portfolio securities to meet interest or principal payments at a time when fundamental investment considerations would not favor such sales. The interest that Janus Long/Short Fund must pay on borrowed money, together with any additional fees to maintain a line of credit or any minimum average balances required to be maintained, are additional costs that will reduce or eliminate any net investment income and may also offset any potential capital gains. Unless the appreciation and income, if any, on assets acquired with borrowed funds exceed the costs of borrowing, the use of leverage will diminish the investment performance of Janus Long/Short Fund compared with what it would have been without leverage.
Counterparties
Fund or underlying fund transactions involving a counterparty are subject to the risk that the counterparty or a third party will not fulfill its obligation to the Fund or underlying funds (“counterparty risk”). Counterparty risk may arise because of the counterparty’s financial condition (i.e., financial difficulties, bankruptcy, or insolvency), market activities and developments, or other reasons, whether foreseen or not. A counterparty’s inability to fulfill its obligation may result in significant financial loss to the Fund or underlying funds. The Fund or underlying funds may be unable to recover their investments from the counterparty or may obtain a limited recovery, and/or recovery may be delayed. The extent of the Fund’s or underlying funds’ exposure to counterparty risk in respect to financial assets approximates their carrying value as recorded on the Fund’s Statement of Assets and Liabilities.
The Fund or underlying funds may be exposed to counterparty risk through participation in various programs including, but not limited to, lending their securities to third parties, cash sweep arrangements whereby the Fund’s or underlying funds’ cash balances are invested in one or more types of cash management vehicles, as well as investments in, but not limited to, repurchase agreements, debt securities, and derivatives, including various types of swaps, futures and options. The Fund or underlying funds intend to enter into financial transactions with counterparties that Janus Capital believes to be creditworthy at the time of the transaction. There is always the risk that Janus Capital’s analysis of a counterparty’s creditworthiness is incorrect or may change due to market conditions. To the extent that the Fund or underlying funds focus their transactions with a limited number of counterparties, they will have greater exposure to the risks associated with one or more counterparties.
Exchange-Traded Funds
The Fund or underlying funds may invest in exchange-traded funds, which generally are index-based investment companies that hold substantially all of their assets in securities representing their specific index. As a shareholder of another investment company, the Fund or underlying funds would bear their pro rata portion of the other investment company’s expenses, including advisory fees, in addition to the expenses the Fund or underlying funds bear directly in connection with their own operations.
Exchange-Traded Notes
The Fund or underlying funds may invest directly in exchange-traded notes (“ETNs”), which are senior, unsecured, unsubordinated debt securities whose returns are linked to a particular index and provide exposure to
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the total returns of various market indices, including indices linked to stocks, bonds, commodities and currencies. This type of debt security differs from other types of bonds and notes. ETN returns are based upon the performance of a market index minus applicable fees; no periodic coupon payments are distributed and no principal protections exist. ETNs do not pay cash distributions. Instead, the value of dividends, interest, and investment gains are captured in the Fund’s or underlying funds’ total returns. The Fund or underlying funds will invest in these securities when desiring exposure to debt securities or commodities. When evaluating ETNs for investment, Janus Capital will consider the potential risks involved, expected tax efficiency, rate of return, and credit risk. When the Fund or underlying funds invest in ETNs, they will bear their proportionate share of any fees and expenses borne by the ETN. There may be restrictions on the Fund’s or underlying funds’ right to redeem their investment in an ETN, which is meant to be held until maturity. The Fund’s decision to sell its ETN holdings may be limited by the availability of a secondary market.
Floating Rate Loans
Certain underlying funds, particularly Janus Balanced Fund, Janus Flexible Bond Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may invest in floating rate loans. Floating rate loans are debt securities that have floating interest rates, which adjust periodically, and are tied to a benchmark lending rate, such as LIBOR. In other cases, the lending rate could be tied to the prime rate offered by one or more major U.S. banks or the rate paid on large certificates of deposit traded in the secondary markets. If the benchmark lending rate changes, the rate payable to lenders under the loan will change at the next scheduled adjustment date specified in the loan agreement. Floating rate loans are typically issued to companies (“borrowers”) in connection with recapitalizations, acquisitions, and refinancings. Floating rate loan investments are generally below investment grade. Senior floating rate loans are secured by specific collateral of a borrower and are senior in the borrower’s capital structure. The senior position in the borrower’s capital structure generally gives holders of senior loans a claim on certain of the borrower’s assets that is senior to subordinated debt and preferred and common stock in the case of a borrower’s default. Floating rate loan investments may involve foreign borrowers, and investments may be denominated in foreign currencies. Floating rate loans often involve borrowers whose financial condition is troubled or uncertain and companies that are highly leveraged. The underlying funds may invest in obligations of borrowers who are in bankruptcy proceedings. Floating rate loans may include fully funded term loans or revolving lines of credit.
Initial Public Offerings
The underlying funds may invest in initial public offerings (“IPOs”). IPOs and other investment techniques may have a magnified performance impact on an underlying fund with a small asset base. An underlying fund may not experience similar performance as its assets grow.
Interfund Lending
As permitted by the Securities and Exchange Commission (“SEC”), or the 1940 Act and rules promulgated thereunder, the underlying funds may be party to interfund lending agreements between the underlying funds and other Janus Capital sponsored mutual funds and certain pooled investment vehicles, which permit them to borrow or lend cash at a rate beneficial to both the borrowing and lending funds. Outstanding borrowings from all sources totaling 10% or more of the borrowing underlying fund’s total assets must be collateralized at 102% of the outstanding principal value of the loan; loans of less than 10% may be unsecured.
Mortgage- and Asset-Backed Securities
The underlying funds may purchase fixed or variable rate mortgage-backed securities issued by the Government National Mortgage Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”), the Federal Home Loan Mortgage Corporation (“Freddie Mac”), or other governmental or government-related entities. Historically, Fannie Mae and Freddie Mac securities were not backed by the full faith and credit of the U.S. Government, and may not be in the future. In September 2008, the Federal Housing Finance Agency (“FHFA”), an agency of the U.S. Government, placed Fannie Mae and Freddie Mac under conservatorship to provide stability in the financial markets, mortgage availability and taxpayer protection by preserving Fannie Mae’s and Freddie Mac’s assets, and placing them in a sound and solvent condition. Under the conservatorship, the management of Fannie Mae and Freddie Mac was replaced. The effect that the FHFA’s conservatorship will have on Fannie Mae’s and Freddie Mac’s debt and equities is unclear. The underlying funds may purchase other mortgage- and asset-backed securities through single- and multi-seller conduits, collateralized debt obligations, structured investment vehicles, and other similar securities. Asset-backed securities may be backed by automobile loans, equipment leases, credit card receivables, or other collateral. In the event the underlying securities fail to perform, these investment vehicles could be forced to sell the assets and recognize losses on such assets, which could impact the underlying funds’ yield and
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Notes to Financial Statements (unaudited) (continued)
the underlying funds’ return. In addition, mortgage-backed securities may be supported by some form of government or private guarantee and/or insurance. However, there is no assurance that the guarantors or insurers will meet their obligations.
Unlike traditional debt instruments, payments on these securities include both interest and a partial payment of principal. Prepayment risk, which results from prepayments of the principal of underlying loans, may shorten the effective maturities of these securities and may result in an underlying fund having to reinvest proceeds at a lower interest rate.
In addition to prepayment risk, investments in mortgage-backed securities, including those comprised of subprime mortgages, and investments in other asset-backed securities comprised of under-performing assets may be subject to a higher degree of credit risk, valuation risk, and liquidity risk. Additionally, although mortgages and mortgage-related securities are generally supported by some form of government or private guarantee and/or insurance, there is no assurance that private guarantors or insurers will meet their obligations.
Mortgage- and asset-backed securities are also subject to extension risk, which is the risk that rising interest rates could cause mortgages or other obligations underlying these securities to be paid more slowly than expected, increasing an underlying fund’s sensitivity to interest changes and causing its price to decline.
Mortgage Dollar Rolls
Certain underlying funds, particularly Janus Flexible Bond Fund, Janus Global Real Estate Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may enter into “mortgage dollar rolls.” In a “mortgage dollar roll” transaction, the underlying funds sell a mortgage-related security (such as a Ginnie Mae security) to a dealer and simultaneously agree to repurchase a similar security (but not the same security) in the future at a predetermined price. The underlying funds will not be entitled to receive interest and principal payments while the dealer holds the security. The difference between the sale price and the future purchase price is recorded as an adjustment to investment income of the underlying funds.
The underlying funds’ obligations under a dollar roll agreement must be covered by cash, U.S. Government securities or other liquid high-grade debt obligations equal in value to the securities subject to repurchase by the underlying funds maintained in a segregated account. To the extent that the underlying funds collateralize their obligations under a dollar roll agreement, the asset coverage requirements of the 1940 Act will not apply to such transactions. Furthermore, under certain circumstances, an underlying mortgage-backed security that is part of a dollar roll transaction may be considered illiquid.
Successful use of mortgage dollar rolls depends on the portfolio managers’ ability to predict interest rates and mortgage payments. Dollar roll transactions involve the risk that the market value of the securities the underlying funds are required to purchase may decline below the agreed upon repurchase price.
Restricted Security Transactions
Restricted securities held by the underlying funds may not be sold except in exempt transactions or in a public offering registered under the Securities Act of 1933, as amended. The risk of investing in such securities is generally greater than the risk of investing in the securities of widely held, publicly traded companies. Lack of a secondary market and resale restrictions may result in the inability of the underlying funds to sell a security at a fair price and may substantially delay the sale of the security. In addition, these securities may exhibit greater price volatility than securities for which secondary markets exist.
Securities Lending
Under procedures adopted by the Trustees, the underlying funds may seek to earn additional income through lending their securities to certain qualified broker-dealers and institutions on a short-term or long-term basis. The underlying funds may lend portfolio securities on a short-term or long-term basis, in an amount equal to up to 1/3 of their total assets as determined at the time of the loan origination. When an underlying fund lends its securities, it receives collateral (including cash collateral), at least equal to the value of securities loaned. The underlying funds may earn income by investing this collateral in one or more affiliated or non-affiliated cash management vehicles. It is also possible that, due to a decline in the value of a cash management vehicle, the underlying funds may lose money. There is also the risk that when portfolio securities are lent, the securities may not be returned on a timely basis, and the underlying funds may experience delays and costs in recovering the security or gaining access to the collateral provided to the underlying funds to collateralize the loan. If the underlying funds are unable to recover a security on loan, the underlying funds may use the collateral to purchase replacement securities in the market. There is a risk that the value of the collateral could decrease below the cost of the replacement security by the time the replacement investment is made, resulting in a loss to the underlying funds. Janus Capital intends to manage the cash collateral in an affiliated cash
34 | DECEMBER 31, 2010
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management vehicle and will receive an investment advisory fee for managing such assets.
The borrower pays fees at the underlying funds’ direction to Deutsche Bank AG (the “Lending Agent”). The Lending Agent may retain a portion of the interest earned on the cash collateral invested. The cash collateral invested by the Lending Agent is disclosed on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). The lending fees and an underlying fund’s portion of the interest income earned on cash collateral are included on the underlying fund’s Statements of Operations in its most recent annual or semiannual reports (if applicable).
The underlying funds did not have any securities on loan during the period.
Securities Traded on a To-Be-Announced Basis
Certain underlying funds, particularly Janus Flexible Bond Fund, Janus Global Real Estate Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may trade securities on a to-be-announced (“TBA”) basis. In a TBA transaction, the underlying funds commit to purchasing or selling securities for which specific information is not yet known at the time of the trade, particularly the face amount and maturity date in Ginnie Mae, Fannie Mae and/or Freddie Mac transactions.
Securities purchased on a TBA basis are not settled until they are delivered to the underlying funds, normally 15 to 45 days later. Beginning on the date the underlying funds enter into a TBA transaction, cash, U.S. Government securities or other liquid high-grade debt obligations are segregated in an amount equal in value to the purchase price of the TBA security. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.
Short Sales
The underlying funds, except the Risk-Managed funds, may engage in “short sales against the box.” Short sales against the box involve either selling short a security that the underlying funds own or selling short a security that the underlying funds have the right to obtain, for delivery at a specified date in the future. The underlying funds may enter into short sales against the box to hedge against anticipated declines in the market price of portfolio securities. The underlying funds do not deliver from their portfolios the securities sold short and do not immediately receive the proceeds of the short sale. The underlying funds borrow the securities sold short and receive proceeds from the short sale only when they deliver the securities to the lender. If the value of the securities sold short increases prior to the scheduled delivery date, the underlying funds lose the opportunity to participate in the gain.
The underlying funds, except the Risk-Managed funds, may also engage in other short sales. The underlying funds may engage in short sales when the portfolio managers and/or investment personnel anticipate that a security’s market purchase price will be less than its borrowing price. To complete the transaction, the underlying funds must borrow the security to deliver it to the purchaser and buy that same security in the market to return it to the lender. No more than 10% of the underlying funds’ net assets may be invested in short positions (through short sales of stocks, structured products, futures, swaps, and uncovered written calls). The underlying funds may engage in short sales “against the box” and options for hedging purposes that are not subject to this 10% limit. The underlying Janus Long/Short Fund is not subject to any such limit. Although the potential for gain as a result of a short sale is limited to the price at which an underlying fund sold the security short less the cost of borrowing the security, the potential for loss is theoretically unlimited because there is no limit to the cost of replacing the borrowed security. There is no assurance that the underlying funds will be able to close out a short position at a particular time or at an acceptable price. A gain or a loss will be recognized upon termination of a short sale. Short sales held by the underlying funds are fully collateralized by restricted cash or other securities, which are denoted on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). The underlying funds are also required to pay the lender of the security any dividends or interest that accrues on a borrowed security during the period of the loan. Depending on the arrangements made with the broker or custodian, an underlying fund may or may not receive any payments (including interest) on collateral it has deposited with the broker. The underlying funds pay stock loan fees on assets borrowed from the security broker.
The underlying funds may also enter into short positions through derivative instruments, such as options contracts, futures contracts, and swap agreements, which may expose the underlying funds to similar risks. To the extent that the underlying funds enter into short derivative positions, the underlying funds may be exposed to risks similar to those associated with short sales, including the risk that the underlying funds’ losses are theoretically unlimited.
When-Issued Securities
The underlying funds may purchase or sell securities on a when-issued or forward commitment basis. The price of the underlying securities and date when the securities will
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Notes to Financial Statements (unaudited) (continued)
be delivered and paid for are fixed at the time the transaction is negotiated. Losses may arise due to changes in the market value of the securities or from the inability of counterparties to meet the terms of the contract. In connection with such purchases, the underlying funds may hold liquid assets as collateral with the underlying funds’ custodian sufficient to cover the purchase price.
4. | Investment Advisory Agreements and Other Transactions with Affiliates |
The Fund pays Janus Capital an investment advisory fee which is calculated daily and paid monthly. The following table reflects the Fund’s contractual investment advisory fee rate (expressed as an annual rate).
Contractual | ||||||||
Average | Investment | |||||||
Daily Net | Advisory | |||||||
Assets | Fee (%) | |||||||
Fund | of the Fund | (annual rate) | ||||||
Janus Dynamic Allocation Fund(1) | All Asset Levels | 0.07 | ||||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
Janus Services LLC (“Janus Services”), a wholly-owned subsidiary of Janus Capital, is the Fund’s and underlying funds’ transfer agent. In addition, Janus Services provides or arranges for the provision of certain other administrative services including, but not limited to, recordkeeping, accounting, order processing, and other shareholder services for the Fund.
Janus Services receives an administrative services fee at an annual rate of 0.25% of the average daily net assets of Class S Shares and Class T Shares of the Fund for providing or procuring administrative services to investors in Class S Shares and Class T Shares of the Fund. Janus Services expects to use all or a significant portion of this fee to compensate retirement plan service providers, broker-dealers, bank trust departments, financial advisors, and other financial intermediaries for providing these services. Services provided by these financial intermediaries may include, but are not limited to, recordkeeping, subaccounting, order processing, providing periodic statements, forwarding prospectuses, shareholder reports, and other materials to existing customers, and other administrative services. Order processing includes the submission of transactions through the National Securities Clearing Corporation (“NSCC”) or similar systems, or those processed on a manual basis with Janus. Janus Services or its affiliates may also pay fees for services provided by intermediaries to the extent the fees charged by intermediaries exceed the 0.25% of net assets charged to Class S Shares and Class T Shares of the Fund.
Certain, but not all, intermediaries may charge administrative fees to investors in Class A, Class C, and Class I Shares for administrative services provided on behalf of such investors. These administrative fees are paid by the Class A Shares, Class C Shares, and Class I Shares of the Fund to Janus Services, which uses such fees to reimburse intermediaries. Janus Services may negotiate the level, structure, and/or terms of the administrative fees with intermediaries requiring such fees on behalf of the Fund. Janus Capital and its affiliates benefit from an increase in assets that may result from such relationships.
Janus Distributors LLC (“Janus Distributors”), a wholly-owned subsidiary of Janus Capital, is the distributor of the Fund. The Fund has adopted a Distribution and Shareholder Servicing Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Fund at an annual rate, as determined from time to time by the Board of Trustees, of up to 0.25% of the Class A Shares average daily net assets, of up to 1.00% of the Class C Shares average daily net assets, and of up to 0.25% of the Class S Shares average daily net assets. Payments under the Plan are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder service expenses actually incurred by the Fund. If any of a Fund’s actual distribution and shareholder service expenses incurred during a calendar year are less than the payments made during a calendar year, the Fund will be refunded for the difference. Refunds, if any, are included in the “Distribution fees and shareholder servicing fees” in the Statements of Operations.
Janus Capital has agreed until at least November 1, 2011 to reimburse the Fund by the amount, if any, that such Fund’s normal operating expenses in any fiscal year, including the investment advisory fee, but excluding any expenses of an underlying fund (acquired fund fees and expenses), class-specific distribution and shareholder servicing fees applicable to Class A Shares, Class C Shares, and Class S Shares, the administrative services fees payable pursuant to the Transfer Agency Agreement applicable to Class S Shares and Class T Shares, brokerage commissions, interest, dividends, taxes and extraordinary expenses, exceed the annual rate noted below. If applicable, amounts reimbursed to the Fund by Janus Capital are disclosed as “Excess Expense Reimbursement” on the Statements of Operations.
Expense | |||||
Fund | Limit (%) | ||||
Janus Dynamic Allocation Fund(1) | 0.45 | ||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
Janus Capital will be entitled to recoup such reimbursement or fee reduction from the Fund for a three-
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year period commencing with the operations of the Fund, provided that at no time during such period shall the normal operating expenses allocated to any class of the Fund, with the exceptions noted in the expense limit table, exceed the percentages stated. This recoupment of such reimbursements expires September 3, 2011. At the end of the period ended December 31, 2010, there was no recoupment.
The Board of Trustees has adopted a deferred compensation plan (the “Deferred Plan”) for independent Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Fund. All deferred fees are credited to an account established in the name of the Trustees. The amounts credited to the account then increase or decrease, as the case may be, in accordance with the performance of one or more of the Janus funds that are selected by the Trustees. The account balance continues to fluctuate in accordance with the performance of the selected fund or funds until final payment of all amounts are credited to the account. The fluctuation of the account balance is recorded by the Fund as unrealized appreciation/(depreciation) and is shown as of December 31, 2010 on the Statements of Assets and Liabilities as an asset, “Non-interested Trustees’ deferred compensation,” and a liability, “Non-interested Trustees’ deferred compensation fees.” Additionally, the recorded unrealized appreciation/(depreciation) is included in “Unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” on the Statements of Assets and Liabilities. Deferred compensation expenses for the period ended December 31, 2010 are included in “Non-interested Trustees’ fees and expenses” on the Statements of Operations. Trustees are allowed to change their designation of mutual funds from time to time. Amounts will be deferred until distributed in accordance with the Deferred Plan. No deferred fees were distributed to any Trustee under the Deferred Plan during the period ended December 31, 2010.
Certain officers of the Fund may also be officers and/or directors of Janus Capital. Such officers receive no compensation from the Fund, except for the Fund’s Chief Compliance Officer. The Fund reimburses Janus Capital for a portion of the compensation paid to the Chief Compliance Officer and certain compliance staff of the Trust. Total compensation of $266,383 was paid by the Trust during the period ended December 31, 2010. The Fund’s portion is reported as part of “Other Expenses” on the Statements of Operations.
Class A Shares include a 5.75% upfront sales charge of the offering price of the Fund. The sales charge is allocated between Janus Distributors and financial intermediaries. During the period ended December 31, 2010, Janus Distributors retained the following upfront sales charge:
Upfront | |||||
Fund (Class A Shares) | Sales Charge | ||||
Janus Dynamic Allocation Fund(1) | $ | 1,013 | |||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
A contingent deferred sales charge of 1.00% will be deducted with respect to Class A Shares purchased without a sales load and redeemed within 12 months of purchase, unless waived, as discussed in the Prospectus. Any applicable CDSC will be 1.00% of the lesser of the original purchase price or the value of the redemption of the Class A Shares redeemed. There were no contingent deferred sales charges paid by redeeming shareholders of Class A Shares during the period ended December 31, 2010.
Class C Shares include a 1.00% contingent deferred sales charge paid by redeeming shareholders to Janus Distributors. The contingent deferred sales charge applies to shares redeemed within 12 months of purchase. The redemption price may differ from the net asset value per share. During the period ended December 31, 2010, redeeming shareholders of Class C Shares paid the following contingent deferred sales charge:
Contingent Deferred | |||||
Fund (Class C Shares) | Sales Charge | ||||
Janus Dynamic Allocation Fund(1) | $ | 152 | |||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
The Fund’s expenses may be reduced by expense offsets from an unaffiliated custodian and/or transfer agent. Such credits or offsets are included in “Expense and Fee Offset” on the Statements of Operations (if applicable). The transfer agent fee offsets received during the period reduce “Transfer agent fees and expenses” on the Statements of Operations (if applicable). Custodian offsets received reduce “Custodian fees” on the Statements of Operations (if applicable). The Fund could have employed the assets used by the custodian and/or transfer agent to produce income if they had not entered into an expense offset arrangement.
Pursuant to the terms and conditions of an SEC exemptive order and the provisions of the 1940 Act, the Fund and the underlying funds may participate in an affiliated or non-affiliated cash sweep program. In the cash sweep program, uninvested cash balances of the Fund may be used to purchase shares of affiliated or non-affiliated money market funds or cash management pooled investment vehicles. The Fund is eligible to participate in the cash sweep program (the “Investing Fund”). Janus Cash Liquidity Fund LLC is an affiliated unregistered cash management pooled investment vehicle
Janus Asset Allocation Fund | 37
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Notes to Financial Statements (unaudited) (continued)
that invests primarily in highly-rated short-term fixed-income securities. Janus Cash Liquidity Fund LLC currently maintains a NAV of $1.00 per share and distributes income daily in a manner consistent with a registered 2a-7 product. There are no restrictions on the Fund’s ability to withdraw investments from Janus Cash Liquidity Fund LLC at will, and there are no unfunded capital commitments due from the Fund to Janus Cash Liquidity Fund LLC. As adviser, Janus Capital has an inherent conflict of interest because of its fiduciary duties to the affiliated cash management pooled investment vehicles and the Investing Fund.
During the period ended December 31, 2010, the Fund recorded distributions from affiliated investment companies as affiliated dividend income, and had the following affiliated purchases and sales:
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Janus Dynamic Allocation Fund(1) | |||||||||||||||||||||
INTECH Risk-Managed Growth Fund – Class I Shares | 1,895 | $ | 22,993 | (1,685) | $ | (18,805) | $ | 721 | $ | 2,265 | $ | 191,554 | |||||||||
INTECH Risk-Managed International Fund – Class I Shares | 3,160 | 23,305 | (2,756) | (19,736) | (210) | 2,577 | 184,360 | ||||||||||||||
INTECH Risk-Managed Value Fund – Class I Shares | 2,912 | 26,180 | (5,999) | (54,031) | (494) | 2,650 | 201,948 | ||||||||||||||
Janus Cash Liquidity Fund LLC | 414,269 | 414,269 | (400,960) | (400,960) | – | 303 | 266,847 | ||||||||||||||
Janus Contrarian Fund – Class I Shares | 12,090 | 173,689 | (6,619) | (82,637) | 8,488 | 3,252 | 884,496 | ||||||||||||||
Janus Flexible Bond Fund – Class I Shares | 26,666 | 285,752 | (95,000) | (996,766) | 6,365 | 85,520 | 1,098,320 | ||||||||||||||
Janus Forty Fund – Class I Shares | 4,461 | 146,550 | (2,608) | (84,725) | (2,599) | – | 856,613 | ||||||||||||||
Janus Global Bond Fund – Class I Shares | 17,927 | 179,274 | – | – | – | – | 179,274 | ||||||||||||||
Janus Global Life Sciences Fund – Class I Shares | 1,557 | 35,073 | (2,540) | (51,427) | 2,611 | 1,994 | 309,596 | ||||||||||||||
Janus Global Real Estate Fund – Class I Shares | 8,334 | 77,649 | (943) | (7,344) | 1,118 | 1,997 | 161,392 | ||||||||||||||
Janus Global Select Fund – Class I Shares | 16,568 | 187,122 | (4,992) | (49,175) | 4,532 | 7,053 | 620,314 | ||||||||||||||
Janus High-Yield Fund – Class I Shares | 10,859 | 95,199 | (2,568) | (21,311) | 1,396 | 8,324 | 246,627 | ||||||||||||||
Janus International Equity Fund – Class I Shares | 10,878 | 116,459 | (5,533) | (55,861) | 3,525 | 4,914 | 598,372 | ||||||||||||||
Janus Long/Short Fund – Class I Shares | 10,464 | 109,990 | (137) | (1,447) | (28) | – | 106,989 | ||||||||||||||
Janus Overseas Fund – Class I Shares | 2,467 | 120,883 | (2,382) | (95,567) | 14,558 | 2,218 | 884,368 | ||||||||||||||
Janus Research Core Fund – Class I Shares | 377 | 7,358 | (4,846) | (71,951) | 20,933 | 416 | 45,834 | ||||||||||||||
Janus Research Fund – Class I Shares | 254 | 6,998 | (3,244) | (70,765) | 10,173 | 476 | 75,675 | ||||||||||||||
Janus Short-Term Bond Fund – Class I Shares | 81,226 | 249,363 | – | – | – | 79 | 250,175 | ||||||||||||||
Janus Triton Fund – Class I Shares | 2,216 | 34,163 | (5,833) | (69,852) | 21,483 | 5,300 | 243,913 | ||||||||||||||
Perkins Large Cap Value Fund – Class I Shares | 704 | 9,156 | (580) | (7,758) | (438) | 1,910 | 59,224 | ||||||||||||||
Perkins Mid Cap Value Fund – Class I Shares | 1,300 | 27,322 | (944) | (18,803) | 695 | 1,604 | 184,436 | ||||||||||||||
Perkins Small Cap Value Fund – Class I Shares | 4,267 | 94,675 | (239) | (5,358) | 86 | 2,782 | 96,805 | ||||||||||||||
$ | 2,443,422 | $ | (2,184,279) | $ | 92,915 | $ | 135,634 | $ | 7,747,132 | ||||||||||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
Janus Capital or an affiliate invested and/or redeemed initial seed capital during the period ended December 31, 2010, as indicated in the following table.
Seed | Seed | |||||||||||||||||||
Capital at | Date of | Date of | Capital at | |||||||||||||||||
Fund | 6/30/10 | Purchases | Purchases | Redemptions | Redemption | 12/31/10 | ||||||||||||||
Janus Dynamic Allocation Fund(1) - Class S Shares | $ | 250,000 | $ | – | – | $ | – | – | $ | 250,000 | ||||||||||
Janus Dynamic Allocation Fund(1) - Class T Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
5. | Federal Income Tax |
Income and capital gains distributions are determined in accordance with income tax regulations that may differ from accounting principles generally accepted in the United States of America. These differences are due to differing treatments for items such as net short-term gains, deferral of wash sale losses, foreign currency transactions, net investment losses and capital loss carryovers.
The Fund has elected to treat gains and losses on forward foreign currency contracts as capital gains and losses, if applicable. Other foreign currency gains and losses on debt instruments are treated as ordinary income for federal income tax purposes pursuant to Section 988 of the Internal Revenue Code.
The aggregate cost of investments and the composition of unrealized appreciation and depreciation of investment
38 | DECEMBER 31, 2010
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securities for federal income tax purposes as of December 31, 2010 are noted below.
Unrealized appreciation and unrealized depreciation in the table below exclude appreciation/(depreciation) on foreign currency translations. The primary difference between book and tax appreciation or depreciation of investments is wash sale loss deferrals.
Federal Tax | Unrealized | Unrealized | Net Tax Appreciation/ | |||||||||||
Fund | Cost | Appreciation | (Depreciation) | (Depreciation) | ||||||||||
Janus Dynamic Allocation Fund(1) | $ | 7,232,440 | $ | 1,138,546 | $ | (1,582) | $ | 1,136,964 | ||||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
6. | Expense Ratios |
The expense ratios listed in the Financial Highlights reflect expenses prior to any expense offsets (gross expense ratio) and after expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursement). Listed below are the gross expense ratios for the Fund that would have been in effect, absent the waiver of certain fees and offsets.
For the six-month period ended December 31, 2010
(unaudited), the eleven-month fiscal period ended
June 30, 2010 and the fiscal period ended July 31, 2009
(unaudited), the eleven-month fiscal period ended
June 30, 2010 and the fiscal period ended July 31, 2009
Janus | ||||
Dynamic Allocation Fund(1) | ||||
Class A Shares | ||||
2010 | 1.52% | |||
2010(2) | 1.57% | |||
2009(3) | 13.34% | |||
Class C Shares | ||||
2010 | 2.35% | |||
2010(2) | 2.28% | |||
2009(3) | 13.46% | |||
Class I Shares | ||||
2010 | 1.31% | |||
2010(2) | 1.35% | |||
2009(3) | 13.47% | |||
Class S Shares | ||||
2010 | 1.59% | |||
2010(2) | 1.91% | |||
2009(3) | 16.43% | |||
Class T Shares | ||||
2010 | 1.53% | |||
2010(2) | 1.12% | |||
2009(4) | 7.61% | |||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from September 3, 2008 (inception date) through July 31, 2009. | |
(4) | Period from July 6, 2009 (inception date) through July 31, 2009. |
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Notes to Financial Statements (unaudited) (continued)
7. | Capital Share Transactions |
For the six-month period ended December 31, 2010 (unaudited), the eleven-month fiscal period ended | ||||||||||||||
June 30, 2010 and the fiscal period ended July 31, 2009 | Janus Dynamic Allocation Fund(1) | |||||||||||||
(all numbers are in thousands) | 2010 | 2010(2) | 2009(3) | |||||||||||
Transactions in Fund Shares – Class A Shares: | ||||||||||||||
Shares sold | 17 | 190 | 201 | |||||||||||
Reinvested dividends and distributions | 12 | 4 | – | |||||||||||
Shares repurchased | (27) | (59) | (3) | |||||||||||
Net Increase/(Decrease) in Fund Shares | 2 | 135 | 198 | |||||||||||
Shares Outstanding, Beginning of Period | 333 | 198 | – | |||||||||||
Shares Outstanding, End of Period | 335 | 333 | 198 | |||||||||||
Transactions in Fund Shares – Class C Shares: | ||||||||||||||
Shares sold | 52 | 182 | 149 | |||||||||||
Reinvested dividends and distributions | 8 | 3 | 1 | |||||||||||
Shares repurchased | (33) | (65) | (3) | |||||||||||
Net Increase/(Decrease) in Fund Shares | 27 | 120 | 147 | |||||||||||
Shares Outstanding, Beginning of Period | 267 | 147 | – | |||||||||||
Shares Outstanding, End of Period | 294 | 267 | 147 | |||||||||||
Transactions in Fund Shares – Class I Shares: | ||||||||||||||
Shares sold | 18 | 157 | 89 | |||||||||||
Reinvested dividends and distributions | 5 | 2 | – | |||||||||||
Shares repurchased | (37) | (99) | – | |||||||||||
Net Increase/(Decrease) in Fund Shares | (14) | 60 | 89 | |||||||||||
Shares Outstanding, Beginning of Period | 149 | 89 | – | |||||||||||
Shares Outstanding, End of Period | 135 | 149 | 89 | |||||||||||
Transactions in Fund Shares – Class S Shares: | ||||||||||||||
Shares sold | 2 | 9 | 57 | |||||||||||
Reinvested dividends and distributions | 1 | 1 | – | |||||||||||
Shares repurchased | (1) | (30) | (5) | |||||||||||
Net Increase/(Decrease) in Fund Shares | 2 | (20) | 52 | |||||||||||
Shares Outstanding, Beginning of Period | 32 | 52 | – | |||||||||||
Shares Outstanding, End of Period | 34 | 32 | 52 | |||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||
Shares sold | 17 | 6 | 122* | |||||||||||
Reinvested dividends and distributions | 1 | – | – | |||||||||||
Shares repurchased | (1) | (2) | – | |||||||||||
Net Increase/(Decrease) in Fund Shares | 17 | 4 | 122* | |||||||||||
Shares Outstanding, Beginning of Period | 4 | – | – | |||||||||||
Shares Outstanding, End of Period | 21 | 4 | 122* |
* | Shares are not in thousands. | |
(1) | Formerly named Janus Modular Portfolio Construction® Fund. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from September 3, 2008 (inception date) through July 31, 2009 for Class A Shares, Class C Shares, Class I Shares and Class S Shares and July 6, 2009 (inception date) through July 31, 2009 for Class T Shares. |
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8. | Purchases and Sales of Investment Securities |
For the period ended December 31, 2010, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities and short-term options contracts) was as follows:
Proceeds from | ||||||||||||||
Purchases of | Sales of | |||||||||||||
Long-Term | Long-Term | |||||||||||||
Purchases of | Proceeds from Sales | U.S. Government | U.S. Government | |||||||||||
Fund | Securities | of Securities | Obligations | Obligations | ||||||||||
Janus Dynamic Allocation Fund(1) | $ | 2,123,025 | $ | 1,940,534 | $ | – | $ | – | ||||||
(1) | Formerly named Janus Modular Portfolio Construction® Fund. |
9. | Pending Legal Matters |
In the fall of 2003, the Securities and Exchange Commission (“SEC”), the Office of the New York State Attorney General (“NYAG”), the Colorado Attorney General (“COAG”), and the Colorado Division of Securities (“CDS”) announced that they were investigating alleged frequent trading practices in the mutual fund industry. On August 18, 2004, Janus Capital announced that it had reached final settlements with the SEC, the NYAG, the COAG, and the CDS related to such regulators’ investigations into Janus Capital’s frequent trading arrangements.
A number of civil lawsuits were brought in several state and federal jurisdictions against Janus Capital and certain of its affiliates, the Janus funds, and related entities and individuals based on allegations similar to those announced by the above regulators. Such lawsuits alleged a variety of theories for recovery including, but not limited to, the federal securities laws, other federal statutes (including ERISA), and various common law doctrines. The Judicial Panel on Multidistrict Litigation transferred these actions to the U.S. District Court for the District of Maryland (the “Court”) for coordinated proceedings. On September 29, 2004, five consolidated amended complaints were filed with the Court, two of which still remain: (i) claims by a putative class of shareholders of Janus Capital Group Inc. (“JCGI”) asserting claims on behalf of the shareholders against JCGI and Janus Capital (First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S. District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins, et al. v. Janus Capital Group, Inc., et al., U.S. District Court, District of Maryland, Case No. 04-CV-00818); and (ii) derivative claims by investors in certain Janus funds ostensibly on behalf of such funds (Steinberg et al. v. Janus Capital Management, LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518).
In the First Derivative Traders case (action (i) above), a Motion to Dismiss was previously granted and the matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the United States Court of Appeals for the Fourth Circuit (“Fourth Circuit”). In May 2009, the Fourth Circuit reversed the order of dismissal and remanded the case back to the trial court for further proceedings. In June 2010, the United States Supreme Court agreed to review the Fourth Circuit’s decision. As a result of these developments at the Supreme Court, the trial court has stayed all further proceedings until the Supreme Court rules on the matter. In the Steinberg case (action (ii) above), the trial court entered an order on January 20, 2010, granting Janus Capital’s Motion for Summary Judgment and dismissing the remaining claims asserted against the company. However, in February 2010, Plaintiffs appealed the trial court’s decision with the Fourth Circuit.
Additional lawsuits may be filed against certain of the Janus funds, Janus Capital, and related parties in the future. Janus Capital does not currently believe that these pending actions will materially affect its ability to continue providing services it has agreed to provide to the Janus funds.
10. | New Accounting Pronouncements |
In January 2010, the FASB issued Accounting Standards Update, “Improving Disclosures About Fair Value Measurements.” The Accounting Standards Update requires disclosures about purchases, sales, issuances, and settlements on a gross basis relating to Level 3 measurements. This disclosure will become effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact the adoption of this Accounting Standards Update will have on the Fund’s financial statement disclosures.
11. | Subsequent Event |
Management has evaluated whether any events or transactions occurred subsequent to December 31, 2010 and through the date of issuance of the Fund’s financial statements and determined that there were no material events or transactions that would require recognition or disclosure in the Fund’s financial statements.
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Additional Information (unaudited)
Proxy Voting Policies and Voting Record
A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to its portfolio securities is available without charge: (i) upon request, by calling 1-800-525-0020 (toll free); (ii) on the Fund’s website at janus.com/proxyvoting; and (iii) on the SEC’s website at http://www.sec.gov. Additionally, information regarding the Fund’s proxy voting record for the most recent twelve-month period ended June 30 is also available, free of charge, through janus.com/proxyvoting and from the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Holdings
The Fund files its complete portfolio holdings (schedule of investments) with the SEC for the first and third quarters of each fiscal year on Form N-Q within 60 days of the end of such fiscal quarter. The Fund’s Form N-Q: (i) is available on the SEC’s website at http://www.sec.gov; (ii) may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the Public Reference Room may be obtained by calling 1-800-SEC-0330); and (iii) is available without charge, upon request, by calling Janus at 1-800-525-0020 (toll free).
Approval of Advisory Agreements During The Period
The Trustees of Janus Investment Fund, none of whom has ever been affiliated with Janus Capital (“Independent Trustees”), oversee the management of each Fund and, as required by law, determine annually whether to continue the investment advisory agreement for each Fund and the subadvisory agreements for the nine Funds that utilize subadvisers.
In connection with their most recent consideration of those agreements for each Fund, the Trustees received and reviewed a substantial amount of information provided by Janus Capital and the respective subadvisers in response to requests of the Independent Trustees and their independent legal counsel. They also received and reviewed a considerable amount of information and analysis provided by their independent fee consultant. Throughout their consideration of the agreements, the Independent Trustees were advised by their independent legal counsel. The Independent Trustees met with management to consider the agreements, and also met separately in executive session with their independent legal counsel and their independent fee consultant.
At a meeting held on December 3, 2010, based on the Trustees’ evaluation of the information provided by Janus Capital, the subadvisers and the independent fee consultant, as well as other information, the Trustees determined that the overall arrangements between each Fund and Janus Capital and each subadviser, as applicable, were fair and reasonable in light of the nature, extent and quality of the services provided by Janus Capital, its affiliates and the subadvisers, the fees charged for those services, and other matters that the Trustees considered relevant in the exercise of their business judgment. At that meeting, the Trustees unanimously approved the continuation of the investment advisory agreement for each Fund, and the subadvisory agreement for each subadvised Fund, for the period from February 1, 2011 through February 1, 2012, subject to earlier termination as provided for in each agreement.
In considering the continuation of those agreements, the Trustees reviewed and analyzed various factors that they determined were relevant, including the factors described below, none of which by itself was considered dispositive. However, the material factors and conclusions that formed the basis for the Trustees’ determination to approve the continuation of the agreements are discussed separately below.
Nature, Extent and Quality of Services
The Trustees reviewed the nature, extent and quality of the services provided by Janus Capital and the subadvisers to the Funds, taking into account the investment objective and strategy of each Fund and the knowledge the Trustees gained from their regular meetings with management on at least a quarterly basis and their ongoing review of information related to the Funds. In addition, the Trustees reviewed the resources and key personnel of Janus Capital and each subadviser, particularly noting those employees who provide investment management services to the Funds. The Trustees also considered other services provided to the Funds by Janus Capital or the subadvisers, such as managing the execution of portfolio transactions and the selection of broker-dealers for those transactions, serving as the Funds’ administrator, monitoring adherence to the Funds’ investment restrictions, producing shareholder reports, providing support services for the Trustees and Trustee committees, communicating with shareholders and overseeing the activities of other service providers, including monitoring compliance with various policies and procedures of the Funds and with applicable securities laws and regulations.
The Trustees concluded that the nature, extent and quality of the services provided by Janus Capital or the subadviser to each Fund were appropriate and consistent with the terms of the respective advisory and subadvisory agreements, and that, taking into account steps taken to address those Funds whose performance lagged that of
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their peers for certain periods, the quality of those services had been consistent with or superior to quality norms in the industry and the Funds were likely to benefit from the continued provision of those services. They also concluded that Janus Capital and each subadviser had sufficient personnel, with the appropriate education and experience, to serve the Funds effectively and had demonstrated its continuing ability to attract well-qualified personnel.
Performance of the Funds
The Trustees considered the performance results of each Fund over various time periods. They reviewed information comparing each Fund’s performance with the performance of comparable funds and peer groups identified by Lipper, and with the Fund’s benchmark index. They concluded that the performance of many Funds was good to very good under current market conditions. Although the performance of some Funds lagged that of their peers for certain periods, the Trustees also concluded that Janus Capital had taken or was taking appropriate steps to address those instances of under-performance.
Costs of Services Provided
The Trustees examined information regarding the fees and expenses of each Fund in comparison to similar information for other comparable funds as provided by Lipper. They also reviewed an analysis of that information provided by their independent fee consultant and noted that the rate of management (investment advisory and administrative) fees for most of the Funds, after applicable contractual expense limitations, was below the mean management fee rate of the respective peer group of funds selected by Lipper.
The Trustees considered the methodology used by Janus Capital and each subadviser in determining compensation payable to portfolio managers, the competitive environment for investment management talent and the competitive market for mutual funds in different distribution channels. They concluded that the compensation methodology provided a good alignment of the interests of the portfolio managers with the interests of Fund shareholders.
The Trustees also reviewed management fees charged by Janus Capital to its separate account clients and to non-affiliated funds subadvised by Janus Capital (for which Janus Capital provides only portfolio management services). Although in most instances subadvisory and separate account fee rates for various investment strategies were lower than management fee rates for Funds having a similar strategy, the Trustees noted that, under the terms of the management agreements with the Funds, Janus Capital performs significant additional services for the Funds that it does not provide to those other clients, including administrative services, oversight of the Funds’ other service providers, trustee support, regulatory compliance and numerous other services, and that, in serving the Funds, Janus Capital assumes many legal risks that it does not assume in servicing its other clients. Moreover, they noted that the spread between the average fee rates charged to the Funds and the fee rates that Janus Capital charged to its separate account clients was significantly smaller than the average spread for such fee rates of other advisers, based on publicly available data and research conducted by the Trustees’ independent fee consultant.
The Trustees reviewed information on the profitability to Janus Capital and its affiliates of their relationships with each Fund, as well as an explanation of the methodology utilized in allocating various expenses of Janus Capital and its affiliates among the Funds and other clients. The Trustees also reviewed the financial statements and corporate structure of Janus Capital’s parent company. In their review, the Trustees considered whether Janus Capital and each subadviser receive adequate incentives to manage the Funds effectively. The Trustees recognized that profitability comparisons among fund managers are difficult because very little comparative information is publicly available and the profitability of any fund manager is affected by numerous factors, including the organizational structure of the particular fund manager, the types of funds and other accounts it manages, possible other lines of business, the methodology for allocating expenses and the fund manager’s capital structure and cost of capital. However, taking into account those factors and the analysis provided by the Trustees’ independent fee consultant, and based on the information available, the Trustees concluded that Janus Capital’s profitability with respect to each Fund in relation to the services rendered was not unreasonable.
The Trustees concluded that the management fees and other compensation payable by each Fund to Janus Capital and its affiliates, as well as the fees paid by Janus Capital to the subadvisers of subadvised Funds, were reasonable in relation to the nature, extent and quality of the services provided, taking into account the fees charged by other advisers for managing comparable mutual funds with similar strategies and the fees Janus Capital and the subadvisers charge to other clients. The Trustees also concluded that the overall expense ratio of each Fund was reasonable, taking into account the size of the Fund, the quality of services provided by Janus Capital and any subadviser, the investment performance of the Fund and any expense limitations agreed to by Janus Capital.
Economies of Scale
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Additional Information (unaudited) (continued)
The Trustees considered information about the potential for Janus Capital to realize economies of scale as the assets of the Funds increase. They noted that, although many Funds pay advisory fees at a fixed rate as a percentage of net assets, without any breakpoints, the actual management fee rate paid by each Fund, after any contractual expense limitations, was below the mean management fee rate of the Fund’s peer group identified by Lipper; and, for those Funds whose expenses are being reduced by the contractual expense limitations of Janus Capital, Janus Capital is subsidizing the Funds because they have not reached adequate scale. Moreover, as the assets of many of the Funds have declined in the past few years, the Funds have benefited from having advisory fee rates that have remained constant rather than increasing as assets declined. In addition, performance fee structures have been implemented for several Funds that have caused or will cause the effective rate of advisory fees payable by such a Fund to vary depending on the investment performance of the Fund relative to its benchmark index over the measurement period; and a few Funds have fee schedules with breakpoints and reduced fee rates above certain asset levels. The Trustees also noted that the Funds share directly in economies of scale through the lower charges of third-party service providers that are based in part on the combined scale of all of the Funds. Based on all of the information they reviewed, including research and analysis conduct by the Trustees’ Independent Fee Consultant, the Trustees concluded that the current fee structure of each Fund was reasonable and that the current rates of fees do reflect a sharing between Janus Capital and the Fund of economies of scale at the current asset level of the Fund.
Other Benefits to Janus Capital
The Trustees also considered benefits that accrue to Janus Capital and its affiliates from their relationships with the Funds. They recognized that two affiliates of Janus Capital separately serve the Funds as transfer agent and distributor, respectively, and the transfer agent receives compensation directly from the non-money market funds for services provided. The Trustees also considered Janus Capital’s past and proposed use of commissions paid by the Funds on their portfolio brokerage transactions to obtain proprietary and third-party research products and services benefiting the Fund and/or other clients of Janus Capital. The Trustees concluded that Janus Capital’s use of these types of client commission arrangements to obtain proprietary and third-party research products and services was consistent with regulatory requirements and guidelines and was likely to benefit each Fund. The Trustees also concluded that, other than the services provided by Janus Capital and its affiliates pursuant to the agreements and the fees to be paid by each Fund therefor, the Funds and Janus Capital may potentially benefit from their relationship with each other in other ways. They concluded that Janus Capital benefits from the receipt of research products and services acquired through commissions paid on portfolio transactions of the Funds and that the Funds benefit from Janus Capital’s receipt of those products and services as well as research products and services acquired through commissions paid by other clients of Janus Capital. They further concluded that success of any Fund could attract other business to Janus Capital or other Janus funds, and that the success of Janus Capital could enhance Janus Capital’s ability to serve the Funds.
After full consideration of the above factors, as well as other factors, the Trustees, each of whom is an Independent Trustee, concluded at their December 3, 2010 meeting that the proposed continuation of the investment advisory agreement and, if applicable, the subadvisory agreement for each Fund for another year was in the best interest of the respective Funds and their shareholders.
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Explanations of Charts, Tables and
Financial Statements (unaudited)
Financial Statements (unaudited)
1. | Performance Overviews |
Performance overview graphs compare the performance of a hypothetical $10,000 investment in the Fund (from inception) with one or more widely used market indices. The hypothetical example does not represent the returns of any particular investment.
When comparing the performance of the Fund with an index, keep in mind that market indices do not include brokerage commissions that would be incurred if you purchased the individual securities in the index. They also do not include taxes payable on dividends and interest or operating expenses incurred if you maintained the Fund invested in the index.
Average annual total returns are also quoted for the Fund. Average annual total return is calculated by taking the growth or decline in value of an investment over a period of time, including reinvestment of dividends and distributions, then calculating the annual compounded percentage rate that would have produced the same result had the rate of growth been constant throughout the period. Average annual total return does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares.
Pursuant to federal securities rules, expense ratios shown in the performance chart reflect subsidized and unsubsidized ratios for the prior fiscal year. The total annual fund operating expenses ratio is gross of any fee waivers, reflecting the Fund’s unsubsidized expense ratio. The net annual fund operating expenses ratio (if applicable) includes contractual waivers of Janus Capital and/or Janus Services and reflects the Fund’s subsidized expense ratio. Both the total annual fund operating expenses ratio and net annual fund operating expenses ratio are based on average net assets as of the fiscal period ended June 30, 2010. The ratios also include expenses indirectly incurred by the Fund as a result of investing in other investment companies or pooled investments, which are not reflected in the “Financial Highlights” of this report. As a result, these ratios may be higher or lower than those shown in the “Financial Highlights” in this report. All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
2. | Schedule of Investments |
Following the performance overview section is the Fund’s Schedule of Investments. This schedule reports the industry concentrations and types of securities held in the Fund on the last day of the reporting period. Securities are usually listed by type (common stock, corporate bonds, U.S. Government obligations, etc.) and by industry classification (banking, communications, insurance, etc.). Holdings are subject to change without notice.
The value of each security is quoted as of the last day of the reporting period. The value of securities denominated in foreign currencies is converted into U.S. dollars.
If the Fund invests in foreign securities, it will also provide a summary of investments by country. This summary reports the Fund’s exposure to different countries by providing the percentage of securities invested in each country. The country of each security represents the country in which the company is incorporated. The Fund’s Schedule of Investments relies upon the industry group and country classifications published by Bloomberg L.P.
2a. Forward Currency Contracts
A table listing forward currency contracts follows the Fund’s Schedule of Investments (if applicable). Forward currency contracts are agreements to deliver or receive a preset amount of currency at a future date. Forward currency contracts are used to hedge against foreign currency risk in the Fund’s long-term holdings.
The table provides the name of the foreign currency, the settlement date of the contract, the amount of the contract, the value of the currency in U.S. dollars and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the change in currency exchange rates from the time the contract was opened to the last day of the reporting period.
2b. Futures
A table listing futures contracts follows the Fund’s Schedule of Investments (if applicable). Futures contracts are contracts that obligate the buyer to receive and the seller to deliver an instrument or money at a specified price on a specified date. Futures are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, the principal amount, value and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the marked-to-market amount for the last day of the reporting period.
2c. Options
A table listing written options contracts follows the Fund’s Schedule of Investments (if applicable). Written options contracts are contracts that obligate the Fund to sell or purchase an underlying security at a fixed price, upon exercise of the option. Options are used to hedge against
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Explanations of Charts, Tables and
Financial Statements (unaudited) (continued)
Financial Statements (unaudited) (continued)
adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, exercise price, value and premiums received.
3. | Statement of Assets and Liabilities |
This statement is often referred to as the “balance sheet.” It lists the assets and liabilities of the Fund on the last day of the reporting period.
The Fund’s assets are calculated by adding the value of the securities owned, the receivable for securities sold but not yet settled, the receivable for dividends declared but not yet received on stocks owned and the receivable for Fund shares sold to investors but not yet settled. The Fund’s liabilities include payables for securities purchased but not yet settled, Fund shares redeemed but not yet paid and expenses owed but not yet paid. Additionally, there may be other assets and liabilities such as unrealized gain or loss on forward currency contracts.
The section entitled “Net Assets Consist of” breaks down the components of the Fund’s net assets. Because the Fund must distribute substantially all earnings, you will notice that a significant portion of net assets is shareholder capital.
The last section of this statement reports the net asset value (“NAV”) per share on the last day of the reporting period. The NAV is calculated by dividing the Fund’s net assets (assets minus liabilities) by the number of shares outstanding.
4. | Statements of Operations |
These statements detail the Fund’s income, expenses, gains and losses on securities and currency transactions, and appreciation or depreciation of current Fund holdings.
The first section in this statement, entitled “Investment Income,” reports the dividends earned from stocks and interest earned from interest-bearing securities in the Fund.
The next section reports the expenses incurred by the Fund, including the advisory fee paid to the investment adviser, transfer agent fees and expenses, and printing and postage for mailing statements, financial reports and prospectuses. Expense offsets and expense reimbursements, if any, are also shown.
The last section lists the increase or decrease in the value of securities held in the Fund. The Fund will realize a gain (or loss) when it sells its position in a particular security. An unrealized gain (or loss) refers to the change in net appreciation or depreciation of the Fund during the reporting period. “Net Realized and Unrealized Gain/(Loss) on Investments” is affected both by changes in the market value of Fund holdings and by gains (or losses) realized during the reporting period.
5. | Statements of Changes in Net Assets |
These statements report the increase or decrease in the Fund’s net assets during the reporting period. Changes in the Fund’s net assets are attributable to investment operations, dividends, distributions and capital share transactions. This is important to investors because it shows exactly what caused the Fund’s net asset size to change during the period.
The first section summarizes the information from the Statements of Operations regarding changes in net assets due to the Fund’s investment performance. The Fund’s net assets may also change as a result of dividend and capital gains distributions to investors. If investors receive their dividends in cash, money is taken out of the Fund to pay the distribution. If investors reinvest their dividends, the Fund’s net assets will not be affected. If you compare the Fund’s “Net Decrease from Dividends and Distributions” to the “Reinvested dividends and distributions,” you will notice that dividend distributions had little effect on the Fund’s net assets. This is because the majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under “Capital Share Transactions.” “Capital Shares” refers to the money investors contribute to the Fund through purchases or withdrawals via redemptions. The Fund’s net assets will increase and decrease in value as investors purchase and redeem shares from the Fund.
6. | Financial Highlights |
This schedule provides a per-share breakdown of the components that affect the Fund’s NAV for current and past reporting periods. Not only does this table provide you with total return, it also reports total distributions, asset size, expense ratios and portfolio turnover rate.
The first line in the table reflects the NAV per share at the beginning of the reporting period. The next line reports the net investment income per share, which comprises dividends and interest income earned on securities held by the Fund. Following is the total of gains/(losses), realized and unrealized. Dividends and distributions are then subtracted to arrive at the NAV per share at the end of the period. The next line reflects the average annual total return reported the last day of the period. The total return may include adjustments in accordance with generally accepted accounting principles. As a result, the
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total return may differ from the total return reflected for shareholder transactions.
Also included are the expense ratios, or the percentage of average net assets that were used to cover operating expenses during the period. Expense ratios vary across Funds within the Trust for a number of reasons, including the differences in management fees, the frequency of dividend payments and the extent of foreign investments, which entail greater transaction costs.
The Fund’s expenses may be reduced through expense-reduction arrangements. These arrangements may include the use of balance credits or transfer agent fee offsets. The Statements of Operations reflect total expenses before any such offset, the amount of the offset and the net expenses. The expense ratios listed in the Financial Highlights reflect total expenses prior to any expense offset (gross expense ratio) and after the expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursements), if applicable.
The ratio of net investment income/(loss) summarizes the income earned less expenses, divided by the average net assets of the Fund during the reporting period. Don’t confuse this ratio with the Fund’s yield. The net investment income ratio is not a true measure of the Fund’s yield because it doesn’t take into account the dividends distributed to the Fund’s investors.
The next figure is the portfolio turnover rate, which measures the buying and selling activity in the Fund. Portfolio turnover is affected by market conditions, changes in the asset size of the Fund, the nature of the Fund’s investments and the investment style of the portfolio manager. A 100% rate implies that an amount equal to the value of the entire portfolio is turned over in a year; a 50% rate means that an amount equal to the value of half the portfolio is traded in a year; and a 200% rate means that an amount equal to the value of the portfolio is traded every six months.
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Notes
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Notes
Janus Asset Allocation Fund | 49
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Janus provides access to a wide range of investment disciplines.
Alternative
Janus alternative funds seek to deliver strong risk-adjusted returns over a full market cycle with lower correlation to equity markets than traditional investments.
Asset Allocation
Janus’ asset allocation funds utilize our fundamental, bottom-up research to balance risk over the long term. From fund options that meet investors’ risk tolerance and objectives to a method that incorporates non-traditional investment choices to seek non-correlated sources of risk and return, Janus’ asset allocation funds aim to allocate risk more effectively.
Core
Janus core funds seek investments in more stable and predictable companies. These funds look for a strategic combination of steady growth and for certain funds, some degree of income.
Fixed Income
Janus fixed income funds attempt to provide less risk relative to equities while seeking to deliver a competitive total return through high current income and appreciation. Janus money market funds seek capital preservation and liquidity with current income as a secondary objective.
Global & International
Janus global and international funds seek to leverage Janus’ research capabilities by taking advantage of inefficiencies in foreign markets, where accurate information and analytical insight are often at a premium.
Growth
Janus growth funds focus on companies believed to be the leaders in their respective industries, with solid management teams, expanding market share, margins and efficiencies.
Risk Managed
Our risk-managed funds seek to outperform their respective indices while maintaining a risk profile equal to or lower than the index itself. Managed by INTECH (a Janus subsidiary), these funds use a mathematical process in an attempt to build a more “efficient” portfolio than the index.
Value
Janus value funds invest in companies they believe are poised for a turnaround or are trading at a significant discount to fair value. The goal is to gain unique insight into a company’s true value and identify and evaluate potential catalysts that may unlock shareholder value.
For more information about our funds, contact your investment professional or go to janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus).
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Please consider the charges, risks, expenses and investment objectives carefully before investing or recommending to clients for investment. For a prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus); or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus). Read it carefully before you invest or send money.
Janus Distributors LLC 151 Detroit Street, Denver, CO 80206 (02/11)
Investment products offered are: NOT FDIC-INSURED MAY LOSE VALUE NO BANK GUARANTEE
C-0111-226 | 125-24-93008 02-11 |
Table of Contents
2010 SEMIANNUAL REPORT
Janus Asset Allocation Funds
(formerly named Janus Smart Portfolio – Growth)
Janus Moderate Allocation Fund
(formerly named Janus Smart Portfolio – Moderate)
Janus Conservative Allocation Fund
(formerly named Janus Smart Portfolio – Conservative)
HIGHLIGHTS
• | Portfolio management perspective |
• | Investment strategy behind your fund |
• | Fund performance, characteristics and holdings |
![(JANUS LOGO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932janus.gif)
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Janus Asset Allocation Funds
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Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus containing this and other information, please call Janus at 877.33JANUS(52687) (or 800.525.3713 if you hold Shares directly with Janus Capital). You can also visit janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
Table of Contents
Co-Chief Investment Officers’ Market Perspective (unaudited)
![(JONATHAN COLEMAN PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932pcolemaj.jpg)
Jonathan Coleman
Co-Chief Investment Officer
![(GIBSON SMITH PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932psmithgi.jpg)
Gibson Smith
Co-Chief Investment Officer
We would like to take this opportunity to thank you for investing with Janus and to share some good news. Brent Lynn, portfolio manager of Janus Overseas Fund, was recently named Morningstar’s International Stock-Fund Manager of the Year. Please join us in congratulating Brent and the entire investment team on this prestigious honor. Brent is the first to say that this is a collective, rather than an individual honor, and we are proud that Janus’ fundamental research approach has been recognized as it continues to be the driving force behind the investment process of all our products.
Opportunities in the Recovery
As we head into 2011, the big surprise for the year could be that the recovery looks more and more normal by the day. Economic data points continue to impress, defying skeptics who predicted a slide back to recession. Recent clarity on taxes should facilitate greater investment and spending by companies, and the Federal Reserve (Fed) has indicated that it intends to continue stimulating the economy through monetary policy. While unemployment remains high, job creation will follow if companies continue to show strong profitability and see growth on the horizon, which we expect to happen. Overall, the recovery appears to be gaining momentum.
One reason we’re more bullish is that fiscal and monetary policies are working together to fuel economic growth. The extension of the Bush tax package for two years will add an estimated one percentage point to growth in 2011. Economists and politicians may debate the fiscal responsibility of the package, but along with the improved transparency on taxes, the near-term effect is likely to be an increase in spending and confidence. At the same time, the Fed has signaled that it intends to continue stimulating the economy through additional “quantitative easing” as well as reinvesting coupon and principal payments in the Fed’s current portfolio. All told, we believe these steps will help the healing process now underway.
Naturally, our optimism comes with caveats. Recent data on home prices have been disappointing and we continue to view a potential downturn in housing as the biggest risk for the U.S. economy. We are also concerned about sovereign debt issues in Europe and budgetary challenges to state and local governments in the U.S. Eventually, self-sustaining growth will be necessary to facilitate robust job creation.
Equities Remain Attractive
We think U.S. equities will outperform in 2011. Stimulus measures are working through the system and should provide further support. Ideally, we’ll see a “Goldilocks” scenario: the U.S. economy will get a short-term boost from the stimulus and increased credibility on the international stage if Washington finally tackles the deficit.
Despite the rally late in the period, equity valuations remain moderate by historical standards. Companies have emerged from the recession with pristine balance sheets and net margins of 12.3%, as of the fourth quarter of 2010, close to the highest level in more than 25 years for large firms. Another positive indicator for stocks is an increase in mergers-and-acquisitions activity – evidence that companies are starting to deploy their cash.
With the outlook improving, we think that economically sensitive sectors could outperform. Consumer discretionary, energy, technology and industrials may do well if economic indicators continue to gain strength. Increasing clarity on regulations may help health care and financial services. As rules become more clearly defined, these sectors could regain some market leadership.
Going forward, fundamentals should matter more as the market increasingly differentiates companies based on their balance sheets, growth rates and competitive advantages. We believe this will create a better environment for active managers to add value through stock selection.
Higher Yields and Opportunities in Fixed Income
Bonds had a difficult fourth quarter as yields rose sharply and some of the risk aversion bid into the Treasury market receded. Fiscal and monetary policies will be a headwind for the bond market over the next few years. At the same time, we think the rise in yields is justified as economic data have come in better than expected. In our opinion,
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Continued
bonds remain attractive when evaluated on real returns (yield minus inflation).
The media continues to discuss “bursting bubbles,” and the more this gets overplayed the greater the opportunities for investors. Higher yields and steeper curves make fixed income more attractive in a low inflationary environment. In this context, we continue to favor corporate debt securities as we believe the health and profitability of corporations are improving. The new wave of financial conservatism in corporations is a welcome sign. We think it represents a new mindset for management that will result in more disciplined investment. More conservative capital structures should lead to higher bond prices.
In this volatile climate, similar to selection of individual equities, individual security selection holds the key to higher risk-adjusted returns. We believe that the construct of the indices does not reflect a proper risk appetite for most investors, in our view, forcing investors to hold debt securities that are not fundamentally improving, thus presenting greater downside risk. We believe an active approach with a focus on fundamental company analysis will yield higher risk-adjusted return with better downside protection long term.
Looking Ahead
Investors should be paying keen attention to the strength of the recovery in the United States, as well as pressures in the global economy. Strong Asian and emerging market growth is fueling inflation in certain regions and forcing central banks to raise rates. Developed nations, meanwhile, are continuing to aggressively pursue loose monetary and fiscal policies. In this environment, investors need to focus more than ever on balance in their portfolios, taking in to account current valuations and expected returns. The global recovery is well underway and this will present new opportunities in the markets as well as new challenges. As always, we will work hard to find the most promising investment opportunities for our shareholders.
Thanks again for your trust and confidence in Janus.
Sincerely,
![(-s- JONATHAN COLEMAN)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932scolemaj.gif)
Jonathan Coleman
Co-Chief Investment Officer
![(-s- GIBSON SMITH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932ssmithgi.gif)
Gibson Smith
Co-Chief Investment Officer
2 | DECEMBER 31, 2010
Table of Contents
Co-Chief Investment Officers’ Market Perspective (unaudited)
Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus Capital) or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
Past performance is no guarantee of future results. Visit janus.com/advisor (or janus.com/allfunds if you hold Shares directly with Janus Capital) for current month-end performance.
Award based on Class T Shares. Established in 1988, the Morningstar Fund Manager of the Year Award recognizes portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus to benefit investors. To qualify for the award, managers’ funds must have not only posted impressive returns for the year, but the managers also must have a record of delivering outstanding long-term performance and of aligning their interests with shareholders’. The Fund Manager of the Year Award winners are chosen based on Morningstar’s proprietary research and in-depth evaluation by its fund analysts.
The opinions are those of the authors as of December 2010 and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of individual holdings or market sectors, but as an illustration of broader themes.
Statements in this piece that reflect projections or expectations of future financial or economic performance of a mutual fund or strategy and of the markets in general and statements of a fund’s plans and objectives for future operations are forward-looking statements. Actual results or events may differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements. Important factors that could result in such differences, in addition to the other factors noted with such forward-looking statements, include general economic conditions such as inflation, recession and interest rates.
Funds distributed by Janus Distributors LLC (2/11)
Janus Asset Allocation Funds | 3
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Useful Information About Your Fund Report (unaudited)
Management Commentaries
The Management Commentaries in this report include valuable insight from each of the Funds’ manager as well as statistical information to help you understand how your Fund’s performance and characteristics stack up against those of comparable indices.
Please keep in mind that the opinions expressed by the Funds’ manager in the Management Commentaries are just that: opinions. They are a reflection of the manager’s best judgment at the time this report was compiled, which was December 31, 2010. As the investing environment changes, so could the manager’s opinions. These views are unique to the manager and aren’t necessarily shared by fellow employees or by Janus in general.
Fund Expenses
We believe it’s important for our shareholders to have a clear understanding of Fund expenses and the impact they have on investment return.
The following is important information regarding each Fund’s Expense Example, which appears in each Fund’s Management Commentary within this Semiannual Report. Please refer to this information when reviewing the Expense Example for each Fund.
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (applicable to Class A Shares only); redemption fees, where applicable (and any related exchange fees); and (2) ongoing costs, including management fees; distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only); administrative fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares only); administrative, networking or omnibus fees (applicable to Class A Shares, Class C Shares, and Class I Shares only); and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The example is based upon an investment of $1,000 invested at the beginning of the period and held for the six-month period from July 1, 2010 to December 31, 2010.
Actual Expenses
The first line of the table in each example provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
The second line of the table in each example provides information about hypothetical account values and hypothetical expenses based upon each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Janus Capital Management LLC (“Janus Capital”) has contractually agreed to waive each Fund’s total annual fund operating expenses, excluding any expenses of an underlying fund (acquired fund fees and expenses), class-specific distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only), administrative fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares only), brokerage commissions, interest, dividends, taxes, and extraordinary expenses, to certain limits until at least November 1, 2011. Expenses in the examples reflect application of these waivers. Had the waivers not been in effect, your expenses would have been higher. More information regarding the waivers is available in the Funds’ prospectuses.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as underlying funds’ redemption fees (where applicable) and any related exchange fees. These fees are fully described in certain underlying funds’ prospectuses. Therefore, the second line of each table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
4 | DECEMBER 31, 2010
Table of Contents
Janus Growth Allocation Fund (unaudited)
Fund Snapshot We believe a fund of funds asset allocation portfolio, diversified among investment managers and optimized to a fixed asset mix, can provide attractive long-term returns. Using an institutional-quality asset allocation model, we combine three distinct investment managers into a series of portfolios, defined by specific risk targets, seeking to provide a core solution for long-term investors. | ![]() Dan Scherman portfolio manager |
Performance Overview
Janus Growth Allocation Fund’s Class T Shares returned 17.94% during the six-month period ended December 31, 2010. This compares to a return of 23.27% for the S&P 500 Index, the Fund’s primary benchmark, and a return of 19.82% by its secondary benchmark, the Growth Allocation Index, which is a hypothetical combination of unmanaged indices and includes stocks and bonds in roughly the same proportion as the portfolio (80% equity and 20% fixed income).
Market Review
World equity markets posted a strong second-half of 2010 and finished near their highest levels since July 2008. Worries over how deep spending cuts in government austerity programs would impact global growth and disappointing economic data from the U.S. helped markets start off on a negative note. Mixed economic data led to a range-bound market until August, when improving economic data began lifting markets, a trend that would continue through year-end. Stimulus efforts in Japan and the U.S., strong manufacturing data in China, the U.S. and India helped offset a re-emergence of sovereign debt concerns in Europe and tightening measures in China near period end. Emerging markets, led by Russia, outperformed developed markets, which were held back due to modest gains in Japan. In terms of sectors, materials and energy were top performers, while health care and utilities lagged. Commodities also posted strong gains, led by palladium and sugar; natural gas, which declined, was a notable exception. The dollar was weaker relative to most major currencies.
In the U.S. fixed income market, the investment climate during the last half for 2010 can be described as one of extremes as investors continued to fret over the current easy-money environment potentially ending in inflation while keeping a worried eye on a stubbornly high unemployment rate and a weak housing market in the U.S. Add improving economic data (most notably in consumer-related areas), a steadily deteriorating European banking crises and geopolitical events on the Korean peninsula and you had a true tug-of-war between fear and greed in the market for much of the year. Contributing to rate volatility was the Federal Reserve’s (Fed) implementation of its roughly $600 billion quantitative easing (QE2) program late in the period and the extension of Bush-era tax cuts. While long-term interest rates backed up during the period, most major fixed income segments held onto positive returns.
Investment Process
Janus Growth Allocation Fund is structured as a “fund of funds” portfolio that provides investors with broad, diversified exposure to various types of investments with an emphasis on managing investment risk. The Fund is also designed to blend the three core competencies that Janus practices as an organization: mathematically-driven, risk-managed strategies and fundamentally-driven, growth and value-oriented investments. We believe that combining these very different approaches in a single investment can potentially produce a portfolio with a unique and powerful performance profile.
The investment process involves setting return expectations for a broad range of Janus mutual funds that we believe best represent the full opportunity set available to today’s investor. Then, acting in conjunction with an outside consultant, we establish an ideal “model” portfolio based upon the specific risk/return objective of Janus Growth Allocation Fund. The Janus Asset Allocation Committee also provides input on the overall allocation. Finally, we select the appropriate Janus, Perkins and INTECH funds that replicate our desired exposure. The allocations assigned to each selected underlying fund are consistent with our view of current market conditions and the long-term trade-off between risk and reward potential that each of these investment types represent. However, as a result of changing market conditions, both the mix of underlying funds and the allocations to these funds will change from time to time. Any portfolio risk management process we’ve discussed includes an effort to monitor and
Janus Asset Allocation Funds | 5
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Janus Growth Allocation Fund (unaudited)
manage risk and should not be confused with nor does it imply low risk or the ability to control risk.
Portfolio Review
Given the strong equity market performance during the period, the Fund’s underperformance relative to its primary benchmark was largely driven by the Fund’s fixed income weighting. We were disappointed that our performance relative to the secondary benchmark did not keep pace in a rising market, but we maintained our focus on long-term results, which remained strong. We were not positioned aggressively enough in equities during the period, although all positions had gains. Some of our bottom contributors have historically been conservatively positioned.
Among changes during the period, we reduced our exposure to Janus High-Yield Fund to accommodate a higher credit exposure in Janus Flexible Bond Fund. We also added the new Janus Global Bond Fund by reducing our weighting in Janus Flexible Bond Fund due to our desire for more consistent exposure to non-U.S. bonds, which have grown in importance among asset classes. In equities, we reduced our exposure to Janus Growth and Income Fund in favor of Janus Triton Fund to increase our small-to-mid cap equity exposure. In addition, we added to our position in Janus Overseas Fund and reduced Janus International Equity Fund in an effort to increase the Fund’s risk profile.
Thank you for investing in Janus Growth Allocation Fund.
6 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Janus Growth Allocation Fund (% of Net Assets)
Janus International Equity Fund – Class I Shares | 17.0% | |||
Janus Flexible Bond Fund – Class I Shares | 15.4% | |||
INTECH Risk-Managed Value Fund – Class I Shares | 11.3% | |||
Janus Overseas Fund – Class I Shares | 10.2% | |||
INTECH Risk-Managed Growth Fund – Class I Shares | 7.6% | |||
Perkins Large Cap Value Fund – Class I Shares | 7.6% | |||
Janus Research Fund – Class I Shares | 5.3% | |||
Janus Twenty Fund – Class D Shares | 5.0% | |||
Janus Fund – Class I Shares | 3.0% | |||
Janus Contrarian Fund – Class I Shares | 2.9% | |||
Janus Global Real Estate Fund – Class I Shares | 2.8% | |||
Janus Global Bond Fund – Class I Shares | 2.1% | |||
Perkins Mid Cap Value Fund – Class I Shares | 2.0% | |||
Perkins Small Cap Value Fund – Class I Shares | 2.0% | |||
Janus Growth and Income Fund – Class I Shares | 1.9% | |||
Janus High-Yield Fund – Class I Shares | 1.6% | |||
Janus Triton Fund – Class I Shares | 1.5% | |||
Janus Global Select Fund – Class I Shares | 0.8% |
Janus Growth Allocation Fund At A Glance
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23p02.gif)
Janus Asset Allocation Funds | 7
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Janus Growth Allocation Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23m02.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
Janus Growth Allocation Fund – Class A Shares | |||||||||||||
NAV | 17.88% | 13.34% | 6.40% | 6.40% | 0.91% | 0.91% | |||||||
MOP | 11.09% | 6.86% | 5.15% | 5.15% | |||||||||
Janus Growth Allocation Fund – Class C Shares | |||||||||||||
NAV | 17.47% | 12.50% | 5.62% | 5.62% | 1.67% | 1.67% | |||||||
CDSC | 16.31% | 11.39% | 5.62% | 5.62% | |||||||||
Janus Growth Allocation Fund – Class D Shares(1) | 18.07% | 13.53% | 6.59% | 6.59% | 0.81% | 0.81% | |||||||
Janus Growth Allocation Fund – Class I Shares | 18.09% | 13.65% | 6.57% | 6.57% | 0.68% | 0.68% | |||||||
Janus Growth Allocation Fund – Class S Shares | 17.85% | 13.19% | 6.16% | 6.16% | 1.19% | 1.19% | |||||||
Janus Growth Allocation Fund – Class T Shares | 17.94% | 13.40% | 6.57% | 6.57% | 0.98% | 0.98% | |||||||
S&P 500® Index | 23.27% | 15.06% | 2.29% | 2.29% | |||||||||
Growth Allocation Index | 19.82% | 13.51% | 4.43% | 4.43% | |||||||||
Lipper Quartile – Class T Shares | – | 2nd | 1st | 1st | |||||||||
Lipper Ranking – based on total returns for Mixed-Asset Target Allocation Growth Funds | – | 199/558 | 7/412 | 7/412 | |||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
8 | DECEMBER 31, 2010
Table of Contents
(unaudited)
A Fund which redeems or exchanges certain underlying funds’ shares held for 90 days or less may be subject to an underlying fund’s 2.00% redemption fee, if any.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any expenses of an underlying fund (acquired fund fees and expenses), distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
An underlying fund’s performance may be affected by risks that include those associated with non-diversification, non-investment grade debt securities, undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), derivatives and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Because Janus Capital is the adviser to the Fund and to the underlying funds held within the Fund, it is subject to certain potential conflicts of interest when allocating the assets of the Funds among underlying Janus funds. Performance of the Fund depends on that of the underlying funds, which are subject to the volatility of the financial markets.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus Growth Allocation Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, and Class S Shares commenced operations on July 6, 2009. Performance shown for each class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each class, respectively, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
Effective August 2, 2010, Janus Smart Portfolio — Growth changed its name to Janus Growth Allocation Fund.
* | The Fund’s inception date – December 30, 2005 | |
(1) | Closed to new investors. |
Janus Asset Allocation Funds | 9
Table of Contents
Janus Growth Allocation Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,179.80 | $ | 3.08 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.38 | $ | 2.85 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,175.70 | $ | 6.96 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.80 | $ | 6.46 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,180.70 | $ | 1.59 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.74 | $ | 1.48 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,180.90 | $ | 1.32 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,024.00 | $ | 1.22 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,178.50 | $ | 4.06 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.48 | $ | 3.77 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,180.60 | $ | 1.81 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.54 | $ | 1.68 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.56% for Class A Shares, 1.27% for Class C Shares, 0.29% for Class D Shares, 0.24% for Class I Shares, 0.74% for Class S Shares and 0.33% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
10 | DECEMBER 31, 2010
Table of Contents
Janus Growth Allocation Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Mutual Funds(1) – 100.0% | ||||||||||
Equity Funds – 80.9% | ||||||||||
1,378,912 | INTECH Risk-Managed Growth Fund – Class I Shares | $ | 17,691,447 | |||||||
2,773,387 | INTECH Risk-Managed Value Fund – Class I Shares | 26,208,509 | ||||||||
458,621 | Janus Contrarian Fund – Class I Shares | 6,705,039 | ||||||||
238,074 | Janus Fund – Class I Shares | 6,935,099 | ||||||||
690,986 | Janus Global Real Estate Fund – Class I Shares | 6,522,907 | ||||||||
152,262 | Janus Global Select Fund – Class I Shares | 1,808,867 | ||||||||
144,194 | Janus Growth and Income Fund – Class I Shares | 4,406,554 | ||||||||
3,459,399 | Janus International Equity Fund – Class I Shares | 39,402,559 | ||||||||
469,948 | Janus Overseas Fund – Class I Shares | 23,831,044 | ||||||||
421,643 | Janus Research Fund – Class I Shares | 12,404,749 | ||||||||
211,872 | Janus Triton Fund – Class I Shares | 3,491,654 | ||||||||
178,391 | Janus Twenty Fund – Class D Shares | 11,723,828 | ||||||||
1,306,062 | Perkins Large Cap Value Fund – Class I Shares | 17,579,599 | ||||||||
207,542 | Perkins Mid Cap Value Fund – Class I Shares | 4,684,225 | ||||||||
189,169 | Perkins Small Cap Value Fund – Class I Shares | 4,545,719 | ||||||||
187,941,799 | ||||||||||
Fixed-Income Funds – 19.1% | ||||||||||
3,442,473 | Janus Flexible Bond Fund – Class I Shares | 35,836,150 | ||||||||
482,416 | Janus Global Bond Fund – Class I Shares | 4,824,161 | ||||||||
413,882 | Janus High-Yield Fund – Class I Shares | 3,766,322 | ||||||||
44,426,633 | ||||||||||
Total Investments (total cost $199,451,311) – 100.0% | 232,368,432 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.0)% | (64,983) | |||||||||
Net Assets – 100% | $ | 232,303,449 | ||||||||
(1) | The Fund invests in mutual funds within the Janus family of funds and they may be deemed to be under common control because they share the same Board of Trustees. |
See Notes to Schedules of Investments and Financial Statements.
Janus Asset Allocation Funds | 11
Table of Contents
Janus Moderate Allocation Fund (unaudited)
Fund Snapshot We believe a fund of funds asset allocation portfolio, diversified among investment managers and optimized to a fixed asset mix, can provide attractive long-term returns. Using an institutional-quality asset allocation model, we combine three distinct investment managers into a series of portfolios, defined by specific risk targets, seeking to provide a core solution for long-term investors. | ![]() Dan Scherman portfolio manager |
Performance Overview
Janus Moderate Allocation Fund’s Class T shares returned 14.13% during the six-month period ended December 31, 2010. This compares to a return of 23.27% for the S&P 500 Index, the Fund’s primary benchmark, and a return of 14.98% by its secondary benchmark, the Moderate Allocation Index, which is a hypothetical combination of unmanaged indices and includes stocks and bonds in roughly the same proportion as the portfolio (60% equity and 40% fixed income).
Market Review
World equity markets posted a strong second-half of 2010 and finished near their highest levels since July 2008. Worries over how deep spending cuts in government austerity programs would impact global growth and disappointing economic data from the U.S. helped markets start off on a negative note. Mixed economic data led to a range-bound market until August, when improving economic data began lifting markets, a trend that would continue through year-end. Stimulus efforts in Japan and the U.S., strong manufacturing data in China, the U.S. and India helped offset a re-emergence of sovereign debt concerns in Europe and tightening measures in China near period end. Emerging markets, led by Russia, outperformed developed markets, which were held back due to modest gains in Japan. In terms of sectors, materials and energy were top performers, while health care and utilities lagged. Commodities also posted strong gains, led by palladium and sugar; natural gas, which declined, was a notable exception. The dollar was weaker relative to most major currencies.
In the U.S. fixed income market, the investment climate during the last half for 2010 can be described as one of extremes as investors continued to fret over the current easy-money environment potentially ending in inflation while keeping a worried eye on a stubbornly high unemployment rate and a weak housing market in the U.S. Add improving economic data (most notably in consumer-related areas), a steadily deteriorating European banking crises and geopolitical events on the Korean peninsula and you had a true tug-of-war between fear and greed in the market for much of the year. Contributing to rate volatility was the Federal Reserve’s (Fed) implementation of its roughly $600 billion quantitative easing (QE2) program late in the period and the extension of Bush-era tax cuts. While long-term interest rates backed up during the period, most major fixed income segments held onto positive returns.
Investment Process
Janus Moderate Allocation Fund is structured as a “fund of funds” portfolio that provides investors with broad, diversified exposure to various types of investments with an emphasis on managing investment risk. The Fund is also designed to blend the three core competencies that Janus practices as an organization: mathematically-driven, risk-managed strategies and fundamentally-driven, growth and value-oriented investments. We believe that combining these very different approaches in a single investment can potentially produce a portfolio with a unique and powerful performance profile.
The investment process involves setting return expectations for a broad range of Janus mutual funds that we believe best represent the full opportunity set available to today’s investor. Then, acting in conjunction with an outside consultant, we establish an ideal “model” portfolio based upon the specific risk/return objective of Janus Moderate Allocation Fund. The Janus Asset Allocation Committee also provides input on the overall allocation. Finally, we select the appropriate Janus, Perkins and INTECH funds that replicate our desired exposure. The allocations assigned to each selected underlying fund are consistent with our view of current market conditions and the long-term trade-off between risk and reward potential that each of these investment types represent. However, as a result of changing market conditions, both the mix of underlying funds and the allocations to these funds will change from time to time. Any portfolio risk management process we’ve discussed includes an effort to monitor and
12 | DECEMBER 31, 2010
Table of Contents
(unaudited)
manage risk and should not be confused with nor does it imply low risk or the ability to control risk.
Portfolio Review
Given the strong equity market performance during the period, the Fund’s underperformance relative to its primary benchmark was largely driven by the Fund’s significant fixed income weighting. We were somewhat disappointed that our performance relative to the secondary benchmark did not keep pace in a rising market, but we maintained our focus on long-term results, which remained strong. Our bottom contributors each generated positive returns, but were in conservative asset classes or failed to match their respective benchmarks. Conversely, our top contributors were generally in more aggressive asset classes and have more aggressive profiles.
Among changes during the period, we reduced our exposure to Janus High-Yield Fund to accommodate a higher credit exposure in Janus Flexible Bond Fund. We also reduced our exposure to Janus Global Select Fund in favor of Janus Triton Fund for a purer small-to-mid cap equity exposure. In addition, we increased our exposure to INTECH’s risk-managed funds, Janus Research Fund and Perkins Large Cap Value Fund and reduced our weighting in Janus Growth and Income Fund.
Thank you for investing in Janus Moderate Allocation Fund.
Janus Asset Allocation Funds | 13
Table of Contents
Janus Moderate Allocation Fund (unaudited)
Janus Moderate Allocation Fund (% of Net Assets)
Janus Flexible Bond Fund – Class I Shares | 32.9% | |||
Janus International Equity Fund – Class I Shares | 10.7% | |||
INTECH Risk-Managed Value Fund – Class I Shares | 10.3% | |||
Janus Overseas Fund – Class I Shares | 8.4% | |||
Perkins Large Cap Value Fund – Class I Shares | 6.7% | |||
INTECH Risk-Managed Growth Fund – Class I Shares | 6.0% | |||
Janus Research Fund – Class I Shares | 5.1% | |||
Janus Short-Term Bond Fund – Class I Shares | 3.8% | |||
Perkins Small Cap Value Fund – Class I Shares | 3.0% | |||
Janus Fund – Class I Shares | 3.0% | |||
Janus Growth and Income Fund – Class I Shares | 2.2% | |||
Janus Twenty Fund – Class D Shares | 2.1% | |||
Janus Global Real Estate Fund – Class I Shares | 1.8% | |||
Janus Triton Fund – Class I Shares | 1.7% | |||
Janus High-Yield Fund – Class I Shares | 1.4% | |||
Janus Global Select Fund – Class I Shares | 0.9% |
Janus Moderate Allocation Fund At A Glance
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23p03.gif)
14 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23m03.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
Janus Moderate Allocation Fund – Class A Shares | |||||||||||||
NAV | 14.04% | 11.99% | 6.89% | 6.88% | 0.88% | 0.88% | |||||||
MOP | 7.46% | 5.55% | 5.63% | 5.63% | |||||||||
Janus Moderate Allocation Fund – Class C Shares | |||||||||||||
NAV | 13.67% | 11.32% | 6.11% | 6.10% | 1.64% | 1.64% | |||||||
CDSC | 12.56% | 10.23% | 6.11% | 6.10% | |||||||||
Janus Moderate Allocation Fund – Class D Shares(1) | 14.26% | 12.31% | 7.09% | 7.09% | 0.75% | 0.75% | |||||||
Janus Moderate Allocation Fund – Class I Shares | 14.26% | 12.42% | 7.07% | 7.07% | 0.64% | 0.64% | |||||||
Janus Moderate Allocation Fund – Class S Shares | 14.09% | 11.93% | 6.62% | 6.62% | 1.14% | 1.14% | |||||||
Janus Moderate Allocation Fund – Class T Shares | 14.13% | 12.19% | 7.07% | 7.07% | 0.89% | 0.89% | |||||||
S&P 500® Index | 23.27% | 15.06% | 2.29% | 2.29% | |||||||||
Moderate Allocation Index | 14.98% | 12.07% | 4.82% | 4.82% | |||||||||
Lipper Quartile – Class T Shares | – | 2nd | 1st | 1st | |||||||||
Lipper Ranking – based on total returns for Mixed-Asset Target Allocation Moderate Funds | – | 172/510 | 9/392 | 9/392 | |||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
Janus Asset Allocation Funds | 15
Table of Contents
Janus Moderate Allocation Fund (unaudited)
A Fund which redeems or exchanges certain underlying funds’ shares held for 90 days or less may be subject to an underlying fund’s 2.00% redemption fee, if any.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any expenses of an underlying fund (acquired fund fees and expenses), distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
An underlying fund’s performance may be affected by risks that include those associated with non-diversification, non-investment grade debt securities, undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trust (“REITs”), derivatives and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Because Janus Capital is the adviser to the Fund and to the underlying funds held within the Fund, it is subject to certain potential conflicts of interest when allocating the assets of the Funds among underlying Janus funds. Performance of the Fund depends on that of the underlying funds, which are subject to the volatility of the financial markets.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus Moderate Allocation Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, and Class S Shares commenced operations on July 6, 2009. Performance shown for each class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each class, respectively, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
Effective August 2, 2010, Janus Smart Portfolio — Moderate changed its name to Janus Moderate Allocation Fund.
* | The Fund’s inception date – December 30, 2005 | |
(1) | Closed to new investors. |
16 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,140.40 | $ | 3.24 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.18 | $ | 3.06 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,136.70 | $ | 6.62 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.00 | $ | 6.26 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,142.60 | $ | 1.46 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.84 | $ | 1.38 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,142.60 | $ | 1.13 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,024.15 | $ | 1.07 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,140.90 | $ | 3.67 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.78 | $ | 3.47 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,142.40 | $ | 1.84 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.49 | $ | 1.73 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.60% for Class A Shares, 1.23% for Class C Shares, 0.27% for Class D Shares, 0.21% for Class I Shares, 0.68% for Class S Shares and 0.34% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Asset Allocation Funds | 17
Table of Contents
Janus Moderate Allocation Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Mutual Funds(1) – 100.0% | ||||||||||
Equity Funds – 61.9% | ||||||||||
1,163,360 | INTECH Risk-Managed Growth Fund – Class I Shares | $ | 14,925,906 | |||||||
2,706,883 | INTECH Risk-Managed Value Fund – Class I Shares | 25,580,047 | ||||||||
259,510 | Janus Fund – Class I Shares | 7,559,521 | ||||||||
483,272 | Janus Global Real Estate Fund – Class I Shares | 4,562,084 | ||||||||
197,343 | Janus Global Select Fund – Class I Shares | 2,344,440 | ||||||||
176,172 | Janus Growth and Income Fund – Class I Shares | 5,383,807 | ||||||||
2,329,364 | Janus International Equity Fund – Class I Shares | 26,531,455 | ||||||||
413,417 | Janus Overseas Fund – Class I Shares | 20,964,379 | ||||||||
429,623 | Janus Research Fund – Class I Shares | 12,639,502 | ||||||||
260,814 | Janus Triton Fund – Class I Shares | 4,298,223 | ||||||||
78,194 | Janus Twenty Fund – Class D Shares | 5,138,895 | ||||||||
1,230,221 | Perkins Large Cap Value Fund – Class I Shares | 16,558,780 | ||||||||
315,678 | Perkins Small Cap Value Fund – Class I Shares | 7,585,742 | ||||||||
154,072,781 | ||||||||||
Fixed-Income Funds – 38.1% | ||||||||||
7,881,117 | Janus Flexible Bond Fund – Class I Shares | 82,042,434 | ||||||||
373,388 | Janus High-Yield Fund – Class I Shares | 3,397,832 | ||||||||
3,081,809 | Janus Short-Term Bond Fund – Class I Shares | 9,491,971 | ||||||||
94,932,237 | ||||||||||
Total Investments (total cost $218,782,242) – 100.0% | 249,005,018 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.0% | 2,250 | |||||||||
Net Assets – 100% | $ | 249,007,268 | ||||||||
(1) | The Fund invests in mutual funds within the Janus family of funds and they may be deemed to be under common control because they share the same Board of Trustees. |
See Notes to Schedules of Investments and Financial Statements.
18 | DECEMBER 31, 2010
Table of Contents
Janus Conservative Allocation Fund (unaudited)
Fund Snapshot We believe a fund of funds asset allocation portfolio, diversified among investment managers and optimized to a fixed asset mix, can provide attractive long-term returns. Using an institutional-quality asset allocation model, we combine three distinct investment managers into a series of portfolios, defined by specific risk targets, seeking to provide a core solution for long-term investors. | ![]() Dan Scherman portfolio manager |
Performance Overview
Janus Conservative Allocation Fund’s Class T Shares returned 10.11% during the six-month period ended December 31, 2010. This compares to a return of 23.27% for the S&P 500 Index, the Fund’s primary benchmark, and a 10.25% return by its secondary benchmark, the Conservative Allocation Index, which is a hypothetical combination of unmanaged indices and includes stocks and bonds in roughly the same proportion as the portfolio (40% equity and 60% fixed income).
Market Review
World equity markets posted a strong second-half of 2010 and finished near their highest levels since July 2008. Worries over how deep spending cuts in government austerity programs would impact global growth and disappointing economic data from the U.S. helped markets start off on a negative note. Mixed economic data led to a range-bound market until August, when improving economic data began lifting markets, a trend that would continue through year-end. Stimulus efforts in Japan and the U.S., strong manufacturing data in China, the U.S. and India helped offset a re-emergence of sovereign debt concerns in Europe and tightening measures in China near period end. Emerging markets, led by Russia, outperformed developed markets, which were held back due to modest gains in Japan. In terms of sectors, materials and energy were top performers, while health care and utilities lagged. Commodities also posted strong gains, led by palladium and sugar; natural gas, which declined, was a notable exception. The dollar was weaker relative to most major currencies.
In the U.S. fixed income market, the investment climate during the last half for 2010 can be described as one of extremes as investors continued to fret over the current easy-money environment potentially ending in inflation while keeping a worried eye on a stubbornly high unemployment rate and a weak housing market in the U.S. Add improving economic data (most notably in consumer-related areas), a steadily deteriorating European banking crises and geopolitical events on the Korean peninsula and you had a true tug-of-war between fear and greed in the market for much of the year. Contributing to rate volatility was the Federal Reserve’s (Fed) implementation of its roughly $600 billion quantitative easing (QE2) program late in the period and the extension of Bush-era tax cuts. While long-term interest rates backed up during the period, most major fixed income segments held onto positive returns.
Investment Process
Janus Conservative Allocation Fund is structured as a “fund of funds” portfolio that provides investors with broad, diversified exposure to various types of investments with an emphasis on managing investment risk. The Fund is also designed to blend the three core competencies that Janus practices as an organization: mathematically-driven, risk-managed strategies and fundamentally-driven, growth and value-oriented investments. We believe that combining these very different approaches in a single investment can potentially produce a portfolio with a unique and powerful performance profile.
The investment process involves setting return expectations for a broad range of Janus mutual funds that we believe best represent the full opportunity set available to today’s investor. Then, acting in conjunction with an outside consultant, we establish an ideal “model” portfolio based upon the specific risk/return objective of Janus Conservative Allocation Fund. The Janus Asset Allocation Committee also provides input on the overall allocation. Finally, we select the appropriate Janus, Perkins and INTECH funds that replicate our desired exposure. The allocations assigned to each selected underlying fund are consistent with our view of current market conditions and the long-term trade-off between risk and reward potential that each of these investment types represent. However, as a result of changing market conditions, both the mix of underlying funds and the allocations to these funds will change from time to time. Any portfolio risk management process we’ve discussed includes an effort to monitor and
Janus Asset Allocation Funds | 19
Table of Contents
Janus Conservative Allocation Fund (unaudited)
manage risk and should not be confused with nor does it imply low risk or the ability to control risk.
Portfolio Review
Given the strong equity market performance during the period, the Fund’s underperformance relative to its primary benchmark was largely driven by the Fund’s significant fixed income weighting. The Fund also modestly underperformed its secondary benchmark, but its longer-term relative performance remained strong. Given the strong equity market, it was not surprising that some of the less aggressive funds were among bottom contributors. In general, our fixed income funds performed well relative to their respective benchmarks, but were held back in an environment of rising rates.
Among changes during the period, we reduced our exposure to Janus High-Yield Fund to accommodate a higher credit exposure in Janus Flexible Bond Fund. We also reduced our exposure to Janus Global Select Fund in favor of Janus Triton Fund for a purer small-to-mid cap equity exposure. In addition, we increased our exposure to INTECH’s risk-managed funds, Janus Research Fund and Perkins Large Cap Value Fund and reduced our weighting in Janus Growth and Income Fund.
Thank you for investing in Janus Conservative Allocation Fund.
20 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Janus Conservative Allocation Fund (% of Net Assets)
Janus Flexible Bond Fund – Class I Shares | 51.4% | |||
INTECH Risk-Managed Value Fund – Class I Shares | 8.4% | |||
Janus International Equity Fund – Class I Shares | 6.2% | |||
Janus Short-Term Bond Fund – Class I Shares | 5.8% | |||
Perkins Large Cap Value Fund – Class I Shares | 5.8% | |||
INTECH Risk-Managed Growth Fund – Class I Shares | 5.7% | |||
Janus Research Fund – Class I Shares | 3.9% | |||
Janus Overseas Fund – Class I Shares | 2.8% | |||
Janus High-Yield Fund – Class I Shares | 2.5% | |||
Janus Fund – Class I Shares | 1.8% | |||
Janus Triton Fund – Class I Shares | 1.7% | |||
Janus Growth and Income Fund – Class I Shares | 1.1% | |||
Janus Global Select Fund – Class I Shares | 1.0% | |||
Janus Global Real Estate Fund – Class I Shares | 0.9% | |||
Perkins Small Cap Value Fund – Class I Shares | 0.8% | |||
Janus Contrarian Fund – Class I Shares | 0.2% |
Janus Conservative Allocation Fund At A Glance
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23p01.gif)
Janus Asset Allocation Funds | 21
Table of Contents
Janus Conservative Allocation Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif23m01.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
Janus Conservative Allocation Fund – Class A Shares | |||||||||||||
NAV | 10.03% | 10.52% | 6.78% | 6.78% | 0.83% | 0.83% | |||||||
MOP | 3.67% | 4.19% | 5.53% | 5.52% | |||||||||
Janus Conservative Allocation Fund – Class C Shares | |||||||||||||
NAV | 9.55% | 9.65% | 6.00% | 6.00% | 1.58% | 1.58% | |||||||
CDSC | 8.49% | 8.58% | 6.00% | 6.00% | |||||||||
Janus Conservative Allocation Fund – Class D Shares(1) | 10.10% | 10.69% | 7.02% | 7.02% | 0.68% | 0.68% | |||||||
Janus Conservative Allocation Fund – Class I Shares | 10.10% | 10.79% | 7.00% | 7.00% | 0.59% | 0.59% | |||||||
Janus Conservative Allocation Fund – Class S Shares | 9.96% | 10.35% | 6.51% | 6.51% | 1.08% | 1.08% | |||||||
Janus Conservative Allocation Fund – Class T Shares | 10.11% | 10.60% | 7.00% | 7.00% | 0.86% | 0.86% | |||||||
S&P 500® Index | 23.27% | 15.06% | 2.29% | 2.29% | |||||||||
Conservative Allocation Index | 10.25% | 10.38% | 5.15% | 5.14% | |||||||||
Lipper Quartile – Class T Shares | – | 2nd | 1st | 1st | |||||||||
Lipper Ranking – based on total returns for Mixed-Asset Target Allocation Conservative Funds | – | 133/461 | 6/302 | 6/302 | |||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
22 | DECEMBER 31, 2010
Table of Contents
(unaudited)
A Fund which redeems or exchanges certain underlying funds’ shares held for 90 days or less may be subject to an underlying fund’s 2.00% redemption fee, if any.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any expenses of an underlying fund (acquired fund fees and expenses), distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares) brokerage commissions, interest, dividends, taxes, and extraordinary expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
An underlying fund’s performance may be affected by risks that include those associated with non-diversification, non-investment grade debt securities, undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), derivatives and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Because Janus Capital is the adviser to the Fund and to the underlying funds held within the Fund, it is subject to certain potential conflicts of interest when allocating the assets of the Funds among underlying Janus funds. Performance of the Fund depends on that of the underlying funds, which are subject to the volatility of the financial markets.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus Conservative Allocation Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares commenced operations on July 6, 2009. Performance shown for each class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each class reflects the fees and expenses of each respective class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
Effective August 2, 2010, Janus Smart Portfolio — Conservative changed its name to Janus Conservative Allocation Fund.
* | The Fund’s inception date – December 30, 2005 | |
(1) | Closed to new investors. |
Janus Asset Allocation Funds | 23
Table of Contents
Janus Conservative Allocation Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,100.30 | $ | 2.96 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.38 | $ | 2.85 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,097.40 | $ | 6.87 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.65 | $ | 6.61 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,102.00 | $ | 1.64 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.64 | $ | 1.58 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,102.00 | $ | 1.54 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.74 | $ | 1.48 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,099.60 | $ | 3.86 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.53 | $ | 3.72 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,101.10 | $ | 2.38 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.94 | $ | 2.29 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.56% for Class A Shares, 1.30% for Class C Shares, 0.31% for Class D Shares, 0.29% for Class I Shares, 0.73% for Class S Shares and 0.45% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
24 | DECEMBER 31, 2010
Table of Contents
Janus Conservative Allocation Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Mutual Funds(1) – 100.0% | ||||||||||
Equity Funds – 40.3% | ||||||||||
792,182 | INTECH Risk-Managed Growth Fund – Class I Shares | $ | 10,163,695 | |||||||
1,573,665 | INTECH Risk-Managed Value Fund – Class I Shares | 14,871,139 | ||||||||
22,832 | Janus Contrarian Fund – Class I Shares | 333,798 | ||||||||
110,975 | Janus Fund – Class I Shares | 3,232,697 | ||||||||
177,935 | Janus Global Real Estate Fund – Class I Shares | 1,679,707 | ||||||||
148,807 | Janus Global Select Fund – Class I Shares | 1,767,826 | ||||||||
62,543 | Janus Growth and Income Fund – Class I Shares | 1,911,325 | ||||||||
965,537 | Janus International Equity Fund – Class I Shares | 10,997,470 | ||||||||
96,377 | Janus Overseas Fund – Class I Shares | 4,887,259 | ||||||||
238,616 | Janus Research Fund – Class I Shares | 7,020,083 | ||||||||
187,260 | Janus Triton Fund – Class I Shares | 3,086,038 | ||||||||
759,105 | Perkins Large Cap Value Fund – Class I Shares | 10,217,560 | ||||||||
59,547 | Perkins Small Cap Value Fund – Class I Shares | 1,430,911 | ||||||||
71,599,508 | ||||||||||
Fixed-Income Funds – 59.7% | ||||||||||
8,787,962 | Janus Flexible Bond Fund – Class I Shares | 91,482,682 | ||||||||
488,269 | Janus High-Yield Fund – Class I Shares | 4,443,248 | ||||||||
3,323,051 | Janus Short-Term Bond Fund – Class I Shares | 10,234,998 | ||||||||
106,160,928 | ||||||||||
Total Investments (total cost $161,346,931) – 100.0% | 177,760,436 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.0% | 37,336 | |||||||||
Net Assets – 100% | $ | 177,797,772 | ||||||||
(1) | The Fund invests in mutual funds within the Janus family of funds and they may be deemed to be under common control because they share the same Board of Trustees. |
See Notes to Schedules of Investments and Financial Statements.
Janus Asset Allocation Funds | 25
Table of Contents
Statements of Assets and Liabilities
As of December 31, 2010 (unaudited) | Janus Growth | Janus Moderate | Janus Conservative | |||||||||
(all numbers in thousands except net asset value per share) | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||
Assets: | ||||||||||||
Investments at cost | $ | 199,451 | $ | 218,782 | $ | 161,347 | ||||||
Affiliated investments at value | 232,368 | 249,005 | 177,760 | |||||||||
Receivables: | ||||||||||||
Investments sold | 37 | 714 | 1 | |||||||||
Fund shares sold | 175 | 479 | 649 | |||||||||
Dividends | 156 | 306 | 349 | |||||||||
Non-interested Trustees’ deferred compensation | 6 | 7 | 5 | |||||||||
Other assets | 16 | 2 | 1 | |||||||||
Total Assets | 232,758 | 250,513 | 178,765 | |||||||||
Liabilities: | ||||||||||||
Payables: | ||||||||||||
Investments purchased | 154 | 306 | 347 | |||||||||
Fund shares repurchased | 189 | 1,092 | 499 | |||||||||
Dividends | – | – | – | |||||||||
Advisory fees | 10 | 10 | 7 | |||||||||
Administrative services fees | 24 | 26 | 19 | |||||||||
Distribution fees and shareholder servicing fees | 2 | 5 | 4 | |||||||||
Administrative, networking and omnibus fees | – | – | – | |||||||||
Non-interested Trustees’ fees and expenses | 1 | 1 | 1 | |||||||||
Non-interested Trustees’ deferred compensation fees | 6 | 7 | 5 | |||||||||
Accrued expenses and other payables | 69 | 59 | 85 | |||||||||
Total Liabilities | 455 | 1,506 | 967 | |||||||||
Net Assets | $ | 232,303 | $ | 249,007 | $ | 177,798 |
See footnotes at the end of the Statements.
See Notes to Financial Statements.
26 | DECEMBER 31, 2010
Table of Contents
As of December 31, 2010 (unaudited) | Janus Growth | Janus Moderate | Janus Conservative | |||||||||
(all numbers in thousands except net asset value per share) | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||
Net Assets Consist of: | ||||||||||||
Capital (par value and paid-in surplus)* | $ | 221,327 | $ | 230,830 | $ | 166,978 | ||||||
Undistributed net investment income* | 710 | 1,165 | 1,041 | |||||||||
Undistributed net realized loss from investment and foreign currency transactions* | (22,651) | (13,211) | (6,634) | |||||||||
Unrealized net appreciation of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 32,917 | 30,223 | 16,413 | |||||||||
Total Net Assets | $ | 232,303 | $ | 249,007 | $ | 177,798 | ||||||
Net Assets - Class A Shares | $ | 1,936 | $ | 4,557 | $ | 2,837 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 160 | 374 | 238 | |||||||||
Net Asset Value Per Share(4) | $ | 12.14 | $ | 12.19 | $ | 11.94 | ||||||
Maximum Offering Price Per Share(5) | $ | 12.88 | $ | 12.93 | $ | 12.67 | ||||||
Net Assets - Class C Shares | $ | 1,196 | $ | 5,109 | $ | 4,012 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 99 | 422 | 338 | |||||||||
Net Asset Value Per Share(4) | $ | 12.08 | $ | 12.12 | $ | 11.88 | ||||||
Net Assets - Class D Shares | $ | 215,099 | $ | 218,521 | $ | 157,418 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 17,657 | 17,883 | 13,139 | |||||||||
Net Asset Value Per Share | $ | 12.18 | $ | 12.22 | $ | 11.98 | ||||||
Net Assets - Class I Shares | $ | 2,135 | $ | 2,584 | $ | 1,232 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 175 | 212 | 103 | |||||||||
Net Asset Value Per Share | $ | 12.17 | $ | 12.21 | $ | 11.97 | ||||||
Net Assets - Class S Shares | $ | 664 | $ | 480 | $ | 359 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 55 | 40 | 30 | |||||||||
Net Asset Value Per Share | $ | 12.11 | $ | 12.15 | $ | 11.95 | ||||||
Net Assets - Class T Shares | $ | 11,273 | $ | 17,756 | $ | 11,940 | ||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 925 | 1,454 | 997 | |||||||||
Net Asset Value Per Share | $ | 12.18 | $ | 12.21 | $ | 11.98 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Redemption price per share may be reduced for any applicable contingent deferred sales charge. | |
(5) | Maximum offering price is computed at 100/94.25 of net asset value. |
See Notes to Financial Statements.
Janus Asset Allocation Funds | 27
Table of Contents
Statements of Operations
For the six-month period ended December 31, 2010 (unaudited) | Janus Growth | Janus Moderate | Janus Conservative | |||||||||
(all numbers in thousands) | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||
Investment Income: | ||||||||||||
Dividends from affiliates | $ | 4,129 | $ | 6,046 | $ | 5,712 | ||||||
Total Investment Income | 4,129 | 6,046 | 5,712 | |||||||||
Expenses: | ||||||||||||
Advisory fees | 55 | 56 | 42 | |||||||||
Shareholder reports expense | 69 | 50 | 32 | |||||||||
Transfer agent fees and expenses | 34 | 30 | 65 | |||||||||
Professional fees | 17 | 17 | 17 | |||||||||
Non-interested Trustees’ fees and expenses | 5 | 5 | 3 | |||||||||
Administrative services fees - Class D Shares | 123 | 121 | 90 | |||||||||
Administrative services fees - Class S Shares | 1 | – | – | |||||||||
Administrative services fees - Class T Shares | 14 | 15 | 14 | |||||||||
Distribution fees and shareholder servicing fees - Class A Shares | 1 | 3 | 2 | |||||||||
Distribution fees and shareholder servicing fees - Class C Shares | 5 | 19 | 14 | |||||||||
Distribution fees and shareholder servicing fees - Class S Shares | – | – | – | |||||||||
Administrative, networking and omnibus fees - Class A Shares | – | 2 | 1 | |||||||||
Administrative, networking and omnibus fees - Class C Shares | – | 2 | 1 | |||||||||
Administrative, networking and omnibus fees - Class I Shares | 1 | 1 | – | |||||||||
Other expenses | 5 | 5 | 5 | |||||||||
Total Expenses | 330 | 326 | 286 | |||||||||
Expense and Fee Offset | – | – | – | |||||||||
Net Expenses | 330 | 326 | 286 | |||||||||
Net Investment Income | 3,799 | 5,720 | 5,426 | |||||||||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||||||||||
Net realized gain/(loss) from investment and foreign currency transactions(4) | (1,533) | (344) | 1,032 | |||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 33,455 | 23,274 | 9,185 | |||||||||
Net Gain on Investments | 31,922 | 22,930 | 10,217 | |||||||||
Net Increase in Net Assets Resulting from Operations | $ | 35,721 | $ | 28,650 | $ | 15,643 |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Includes realized gain/(loss) from affiliated investment companies. See Note 4 in Notes to Financial Statements. |
See Notes to Financial Statements.
28 | DECEMBER 31, 2010
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Statements of Changes in Net Assets
For the six-month period ended December 31, 2010 (unaudited), the eight-month | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and the fiscal year ended October 31, 2009 | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(4) | 2009 | 2010 | 2010(4) | 2009 | 2010 | 2010(4) | 2009 | |||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||||||
Net investment income | $ | 3,799 | $ | 1,716 | $ | 4,494 | $ | 5,720 | $ | 2,478 | $ | 4,352 | $ | 5,426 | $ | 2,648 | $ | 3,741 | ||||||||||||||||||
Net realized gain/(loss) from investment and foreign currency transactions(5) | (1,533) | (3,346) | (12,193) | (344) | (2,072) | (6,872) | 1,032 | (428) | (4,304) | |||||||||||||||||||||||||||
Capital gain distribution from Underlying Funds | – | 37 | 1,694 | – | 65 | 1,069 | – | 73 | 428 | |||||||||||||||||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 33,455 | 6,573 | 39,565 | 23,274 | 4,681 | 28,219 | 9,185 | 3,016 | 17,136 | |||||||||||||||||||||||||||
Net Increase in Net Assets Resulting from Operations | 35,721 | 4,980 | 33,560 | 28,650 | 5,152 | 26,768 | 15,643 | 5,309 | 17,001 | |||||||||||||||||||||||||||
Dividends and Distributions to Shareholders: | ||||||||||||||||||||||||||||||||||||
Net Investment Income | ||||||||||||||||||||||||||||||||||||
Class A Shares | (33) | (3) | – | (109) | (34) | – | (98) | (14) | – | |||||||||||||||||||||||||||
Class C Shares | (14) | (5) | – | (101) | (18) | – | (117) | (15) | – | |||||||||||||||||||||||||||
Class D Shares | (3,582) | – | N/A | (5,283) | – | N/A | (5,454) | – | N/A | |||||||||||||||||||||||||||
Class I Shares | (38) | – | – | (63) | (4) | – | (43) | – | – | |||||||||||||||||||||||||||
Class S Shares | (11) | – | – | (11) | – | – | (12) | (3) | – | |||||||||||||||||||||||||||
Class T Shares | (176) | (3,421) | (3,455) | (425) | (3,954) | (3,453) | (395) | (3,805) | (2,871) | |||||||||||||||||||||||||||
Net Realized Gain/(Loss) from Investment Transactions | ||||||||||||||||||||||||||||||||||||
Class A Shares | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||
Class C Shares | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||
Class D Shares | – | – | N/A | – | – | N/A | – | – | N/A | |||||||||||||||||||||||||||
Class I Shares | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||
Class S Shares | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||
Class T Shares | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||
Net Decrease from Dividends and Distributions | (3,854) | (3,429) | (3,455) | (5,992) | (4,010) | (3,453) | (6,119) | (3,837) | (2,871) | |||||||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||||||
Shares Sold | ||||||||||||||||||||||||||||||||||||
Class A Shares | 1,361 | 561 | 145 | 2,710 | 946 | 1,173 | 1,886 | 960 | 239 | |||||||||||||||||||||||||||
Class C Shares | 351 | 733 | 114 | 2,538 | 2,279 | 412 | 2,369 | 1,575 | 254 | |||||||||||||||||||||||||||
Class D Shares | 15,967 | 19,647 | N/A | 30,463 | 25,812 | N/A | 28,690 | 22,444 | N/A | |||||||||||||||||||||||||||
Class I Shares | 183 | 2,011 | 11 | 1,564 | 1,862 | 33 | 679 | 539 | 11 | |||||||||||||||||||||||||||
Class S Shares | 593 | 20 | 11 | 392 | 50 | 11 | 234 | 36 | 157 | |||||||||||||||||||||||||||
Class T Shares | 1,353 | 15,869 | 46,476 | 8,627 | 25,798 | 52,969 | 3,392 | 23,760 | 46,251 | |||||||||||||||||||||||||||
Shares Issued in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||
Class D Shares | N/A | 187,290 | N/A | N/A | 170,506 | N/A | N/A | 121,746 | N/A | |||||||||||||||||||||||||||
Reinvested Dividends and Distributions | ||||||||||||||||||||||||||||||||||||
Class A Shares | 33 | 3 | – | 97 | 32 | – | 82 | 12 | – | |||||||||||||||||||||||||||
Class C Shares | 13 | 5 | – | 92 | 17 | – | 84 | 14 | – | |||||||||||||||||||||||||||
Class D Shares | 3,549 | – | N/A | 5,232 | – | N/A | 5,412 | – | N/A | |||||||||||||||||||||||||||
Class I Shares | 38 | – | – | 62 | 4 | – | 42 | – | – | |||||||||||||||||||||||||||
Class S Shares | 11 | – | – | 11 | – | – | 12 | 3 | – | |||||||||||||||||||||||||||
Class T Shares | 167 | 3,390 | 3,405 | 420 | 3,928 | 3,428 | 348 | 3,747 | 2,848 |
See Notes to Financial Statements.
See footnotes at the end of the Statements.
30 | DECEMBER 31, 2010
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Statements of Changes in Net Assets (continued)
For the six-month period ended December 31, 2010 (unaudited), the eight-month | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and the fiscal year ended October 31, 2009 | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(4) | 2009 | 2010 | 2010(4) | 2009 | 2010 | 2010(4) | 2009 | |||||||||||||||||||||||||||
Shares Repurchased | ||||||||||||||||||||||||||||||||||||
Class A Shares | (190) | (65) | – | (295) | (276) | (25) | (349) | (19) | – | |||||||||||||||||||||||||||
Class C Shares | (4) | (108) | – | (370) | (117) | – | (192) | (176) | – | |||||||||||||||||||||||||||
Class D Shares | (21,194) | (16,409) | N/A | (18,149) | (15,002) | N/A | (18,435) | (12,430) | N/A | |||||||||||||||||||||||||||
Class I Shares | (321) | (35) | – | (907) | (257) | – | (78) | (7) | – | |||||||||||||||||||||||||||
Class S Shares | (22) | – | – | (8) | – | – | (25) | (80) | – | |||||||||||||||||||||||||||
Class T Shares | (2,341) | (17,302) | (32,674) | (2,695) | (11,993) | (29,732) | (2,423) | (10,511) | (31,902) | |||||||||||||||||||||||||||
Shares Reorganized in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||
Class T Shares | N/A | (187,290) | N/A | N/A | (170,506) | N/A | N/A | (121,746) | N/A | |||||||||||||||||||||||||||
Net Increase/(Decrease) from Capital Share Transactions | (453) | 8,320 | 17,488 | 29,784 | 33,083 | 28,269 | 21,728 | 29,867 | 17,858 | |||||||||||||||||||||||||||
Net Increase in Net Assets | 31,414 | 9,871 | 47,593 | 52,442 | 34,225 | 51,584 | 31,252 | 31,339 | 31,988 | |||||||||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||||||
Beginning of period | 200,889 | 191,018 | 143,425 | 196,565 | 162,340 | 110,756 | 146,546 | 115,207 | 83,219 | |||||||||||||||||||||||||||
End of period | $ | 232,303 | $ | 200,889 | $ | 191,018 | $ | 249,007 | $ | 196,565 | $ | 162,340 | $ | 177,798 | $ | 146,546 | $ | 115,207 | ||||||||||||||||||
Undistributed Net Investment Income* | $ | 710 | $ | 765 | $ | 2,478 | $ | 1,165 | $ | 1,437 | $ | 2,969 | $ | 1,041 | $ | 1,733 | $ | 2,922 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(5) | Includes realized gain/(loss) from affiliated investment companies. See affiliates table in Notes to Schedules of Investments. | |
See Notes to Financial Statements.
32 | DECEMBER 31, 2010
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33
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Financial Highlights
Class A Shares
For a share outstanding during the six- | ||||||||||||||||||||||||||||||||||||||
month period ended December 31, 2010 | ||||||||||||||||||||||||||||||||||||||
(unaudited), the eight-month fiscal period | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | |||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.47 | $10.35 | $9.16 | $10.95 | $10.80 | $9.68 | $11.24 | $11.08 | $10.13 | |||||||||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||||||||||
Net investment income | .18 | .17 | .01 | .29 | .18 | .02 | .33 | .33 | .02 | |||||||||||||||||||||||||||||
Net gain on investments (both realized and unrealized) | 1.70 | .14 | 1.18 | 1.25 | .24 | 1.10 | .80 | .20 | .93 | |||||||||||||||||||||||||||||
Total from Investment Operations | 1.88 | .31 | 1.19 | 1.54 | .42 | 1.12 | 1.13 | .53 | .95 | |||||||||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.21) | (.19) | – | (.30) | (.27) | – | (.43) | (.37) | – | |||||||||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Total Distributions and Other | (.21) | (.19) | – | (.30) | (.27) | – | (.43) | (.37) | – | |||||||||||||||||||||||||||||
Net Asset Value, End of Period | $12.14 | $10.47 | $10.35 | $12.19 | $10.95 | $10.80 | $11.94 | $11.24 | $11.08 | |||||||||||||||||||||||||||||
Total Return** | 17.98% | 2.96% | 12.99% | 14.04% | 3.81% | 11.57% | 10.03% | 4.75% | 9.38% | |||||||||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $1,936 | $628 | $149 | $4,557 | $1,844 | $1,145 | $2,837 | $1,173 | $235 | |||||||||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $910 | $343 | $99 | $2,537 | $1,676 | $424 | $1,608 | $710 | $41 | |||||||||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(6) | 0.56% | 0.37% | 0.50% | 0.60% | 0.40% | 0.48% | 0.56% | 0.39% | 0.45% | |||||||||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(6) | 0.56% | 0.37% | 0.47% | 0.60% | 0.40% | 0.44% | 0.56% | 0.39% | 0.37% | |||||||||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 5.60% | 0.92% | 0.56% | 7.22% | 1.82% | 1.43% | 9.10% | 2.67% | 2.70% | |||||||||||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 23% | 13% | 17% | 19% | 13% | 18% | 21% |
Class C Shares
For a share outstanding during the six- | ||||||||||||||||||||||||||||||||||||||
month period ended December 31, 2010 | ||||||||||||||||||||||||||||||||||||||
(unaudited), the eight-month fiscal period | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | |||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.40 | $10.33 | $9.16 | $10.88 | $10.77 | $9.68 | $11.17 | $11.06 | $10.13 | |||||||||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||||||||||
Net investment income | .17 | .13 | – | .24 | .21 | .01 | .32 | .32 | .01 | |||||||||||||||||||||||||||||
Net gain on investments (both realized and unrealized) | 1.66 | .13 | 1.17 | 1.25 | .15 | 1.08 | .77 | .14 | .92 | |||||||||||||||||||||||||||||
Total from Investment Operations | 1.83 | .26 | 1.17 | 1.49 | .36 | 1.09 | 1.09 | .46 | .93 | |||||||||||||||||||||||||||||
Less Distributions: | ||||||||||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.15) | (.19) | – | (.25) | (.25) | – | (.38) | (.35) | – | |||||||||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Total Distributions and Other | (.15) | (.19) | – | (.25) | (.25) | – | (.38) | (.35) | – | |||||||||||||||||||||||||||||
Net Asset Value, End of Period | $12.08 | $10.40 | $10.33 | $12.12 | $10.88 | $10.77 | $11.88 | $11.17 | $11.06 | |||||||||||||||||||||||||||||
Total Return** | 17.57% | 2.41% | 12.77% | 13.67% | 3.33% | 11.26% | 9.74% | 4.17% | 9.18% | |||||||||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $1,196 | $706 | $110 | $5,109 | $2,509 | $406 | $4,012 | $1,648 | $253 | |||||||||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $926 | $398 | $20 | $3,675 | $1,469 | $113 | $2,675 | $953 | $54 | |||||||||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(6) | 1.27% | 1.13% | 1.37% | 1.23% | 1.16% | 1.26% | 1.30% | 1.14% | 1.20% | |||||||||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(6) | 1.27% | 1.13% | 1.26% | 1.23% | 1.16% | 1.20% | 1.30% | 1.14% | 1.13% | |||||||||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 3.04% | 0.27% | (0.18)% | 4.94% | 0.87% | 0.71% | 6.90% | 1.81% | 1.87% | |||||||||||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 23% | 13% | 17% | 19% | 13% | 18% | 21% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(6) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
34 | DECEMBER 31, 2010
Table of Contents
Class D Shares
For a share outstanding during the six-month period ended | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||
December 31, 2010 (unaudited) and the fiscal period | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||
ended June 30, 2010 | 2010 | 2010(4) | 2010 | 2010(4) | 2010 | 2010(4) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.49 | $10.66 | $10.96 | $10.98 | $11.26 | $11.13 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .20 | .03 | .29 | .06 | .37 | .10 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.70 | (.20) | 1.27 | (.08) | .78 | .03 | ||||||||||||||||||||
Total from Investment Operations | 1.90 | (.17) | 1.56 | (.02) | 1.15 | .13 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.21) | – | (.30) | – | (.43) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | ||||||||||||||||||||
Total Distributions and Other | (.21) | – | (.30) | – | (.43) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $12.18 | $10.49 | $12.22 | $10.96 | $11.98 | $11.26 | ||||||||||||||||||||
Total Return** | 18.07% | (1.59)% | 14.26% | (0.18)% | 10.20% | 1.17% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $215,099 | $187,128 | $218,521 | $180,261 | $157,418 | $133,056 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $202,585 | $199,596 | $199,381 | $184,405 | $149,271 | $130,396 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 0.29% | 0.27% | 0.27% | 0.27% | 0.31% | 0.24% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 0.29% | 0.27% | 0.27% | 0.27% | 0.31% | 0.24% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 3.46% | 0.71% | 5.06% | 1.43% | 6.46% | 2.40% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 13% | 17% | 13% | 18% |
Class I Shares
For a share outstanding during the six | ||||||||||||||||||||||||||||||||||||||
-month period ended December 31, 2010 | ||||||||||||||||||||||||||||||||||||||
(unaudited), the eight-month fiscal period | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
period ended October 31, 2009 | 2010 | 2010(6) | 2009(7) | 2010 | 2010(6) | 2009(7) | 2010 | 2010(6) | 2009(7) | |||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.49 | $10.37 | $9.16 | $10.96 | $10.80 | $9.68 | $11.26 | $11.10 | $10.13 | |||||||||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||||||||||
Net investment income | .21 | .23 | – | .29 | .26 | .05 | .32 | .43 | .02 | |||||||||||||||||||||||||||||
Net gain on investments (both realized and unrealized) | 1.69 | .09 | 1.21 | 1.27 | .17 | 1.07 | .83 | .10 | .95 | |||||||||||||||||||||||||||||
Total from Investment Operations | 1.90 | .32 | 1.21 | 1.56 | .43 | 1.12 | 1.15 | .53 | .97 | |||||||||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.22) | (.20) | – | (.31) | (.27) | – | (.44) | (.37) | – | |||||||||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Total Distributions and Other | (.22) | (.20) | – | (.31) | (.27) | – | (.44) | (.37) | – | |||||||||||||||||||||||||||||
Net Asset Value, End of Period | $12.17 | $10.49 | $10.37 | $12.21 | $10.96 | $10.80 | $11.97 | $11.26 | $11.10 | |||||||||||||||||||||||||||||
Total Return** | 18.09% | 3.03% | 13.21% | 14.26% | 3.96% | 11.57% | 10.20% | 4.78% | 9.58% | |||||||||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $2,135 | $1,938 | $11 | $2,584 | $1,625 | $36 | $1,232 | $545 | $11 | |||||||||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $2,050 | $1,065 | $1 | $2,391 | $757 | $29 | $971 | $265 | $2 | |||||||||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 0.24% | 0.14% | 0.49% | 0.21% | 0.16% | 0.19% | 0.29% | 0.15% | 0.20% | |||||||||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 0.24% | 0.13% | 0.29% | 0.21% | 0.16% | 0.18% | 0.29% | 0.14% | 0.13% | |||||||||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 3.45% | 0.86% | 1.04% | 4.99% | 1.70% | 1.72% | 7.31% | 2.53% | 2.98% | |||||||||||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 23% | 13% | 17% | 19% | 13% | 18% | 21% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(5) | See Note 6 in Notes to Financial Statements. | |
(6) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(7) | Period from July 6, 2009 (inception date) through October 31, 2009. |
See Notes to Financial Statements.
Janus Asset Allocation Funds | 35
Table of Contents
Financial Highlights (continued)
Class S Shares
For a share outstanding during the six | ||||||||||||||||||||||||||||||||||||||
-month period ended December 31, 2010 | ||||||||||||||||||||||||||||||||||||||
(unaudited), the eight-month fiscal period | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | |||||||||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.45 | $10.35 | $9.16 | $10.91 | $10.78 | $9.68 | $11.24 | $11.07 | $10.13 | |||||||||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||||||||||
Net investment income | .22 | .15 | – | .26 | .25 | .01 | .32 | .30 | .06 | |||||||||||||||||||||||||||||
Net gain on investments (both realized and unrealized) | 1.65 | .14 | 1.19 | 1.28 | .14 | 1.09 | .80 | .20 | .88 | |||||||||||||||||||||||||||||
Total from Investment Operations | 1.87 | .29 | 1.19 | 1.54 | .39 | 1.10 | 1.12 | .50 | .94 | |||||||||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.21) | (.19) | – | (.30) | (.26) | – | (.41) | (.33) | – | |||||||||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | – | – | |||||||||||||||||||||||||||||
Total Distributions and Other | (.21) | (.19) | – | (.30) | (.26) | – | (.41) | (.33) | – | |||||||||||||||||||||||||||||
Net Asset Value, End of Period | $12.11 | $10.45 | $10.35 | $12.15 | $10.91 | $10.78 | $11.95 | $11.24 | $11.07 | |||||||||||||||||||||||||||||
Total Return** | 17.85% | 2.73% | 12.99% | 14.09% | 3.57% | 11.36% | 9.96% | 4.48% | 9.28% | |||||||||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $664 | $30 | $11 | $480 | $58 | $11 | $359 | $125 | $164 | |||||||||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $387 | $19 | $1 | $296 | $26 | $1 | $262 | $126 | $127 | |||||||||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(6) | 0.74% | 0.65% | 0.87% | 0.68% | 0.66% | 0.92% | 0.73% | 0.64% | 0.67% | |||||||||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(6) | 0.74% | 0.65% | 0.67% | 0.68% | 0.66% | 0.77% | 0.73% | 0.64% | 0.65% | |||||||||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 4.93% | 0.68% | 0.66% | 6.51% | 1.35% | 1.59% | 7.40% | 2.47% | 2.22% | |||||||||||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 23% | 13% | 17% | 19% | 13% | 18% | 21% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(6) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
36 | DECEMBER 31, 2010
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Class T Shares
For a share outstanding during the six-month period ended | ||||||||||||||||||||||||||
December 31, 2010 (unaudited), the eight-month fiscal period | ||||||||||||||||||||||||||
ended June 30, 2010 and each fiscal year or period ended | Janus Growth Allocation Fund(1) | |||||||||||||||||||||||||
October 31 | 2010 | 2010(2) | 2009 | 2008 | 2007 | 2006(3) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.48 | $10.36 | $8.62 | $13.95 | $11.34 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .22 | .29 | .26 | .24 | .16 | .05 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.67 | .01 | 1.69 | (4.93) | 2.62 | 1.29 | ||||||||||||||||||||
Total from Investment Operations | 1.89 | .30 | 1.95 | (4.69) | 2.78 | 1.34 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.19) | (.18) | (.21) | (.24) | (.13) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.40) | (.04) | – | ||||||||||||||||||||
Total Distributions and Other | (.19) | (.18) | (.21) | (.64) | (.17) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $12.18 | $10.48 | $10.36 | $8.62 | $13.95 | $11.34 | ||||||||||||||||||||
Total Return** | 18.06% | 2.86% | 23.32% | (35.15)% | 24.81% | 13.40% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $11,273 | $10,459 | $190,737 | $143,425 | $176,461 | $66,794 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $11,000 | $96,998 | $154,899 | $183,091 | $124,708 | $34,131 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.33% | 0.33% | 0.37% | 0.25% | 0.25% | 0.25% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.33% | 0.33% | 0.36% | 0.24% | 0.24% | 0.24% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 3.32% | 1.84% | 2.90% | 1.95% | 1.32% | 0.98% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 22% | 20% | 23% | 55% | 19% | 28% |
Class T Shares
For a share outstanding during the six-month period ended | ||||||||||||||||||||||||||
December 31, 2010 (unaudited), the eight-month fiscal period | ||||||||||||||||||||||||||
ended June 30, 2010 and each fiscal year or period ended | Janus Moderate Allocation Fund(5) | |||||||||||||||||||||||||
October 31 | 2010 | 2010(2) | 2009 | 2008 | 2007 | 2006(3) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.95 | $10.79 | $9.05 | $12.95 | $11.04 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .09 | .56 | .32 | .31 | .23 | .09 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.47 | (.14) | 1.71 | (3.64) | 1.86 | .95 | ||||||||||||||||||||
Total from Investment Operations | 1.56 | .42 | 2.03 | (3.33) | 2.09 | 1.04 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.30) | (.26) | (.29) | (.29) | (.16) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.28) | (.02) | – | ||||||||||||||||||||
Total Distributions and Other | (.30) | (.26) | (.29) | (.57) | (.18) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $12.21 | $10.95 | $10.79 | $9.05 | $12.95 | $11.04 | ||||||||||||||||||||
Total Return** | 14.24% | 3.80% | 23.19% | (26.77)% | 19.16% | 10.40% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $17,756 | $10,268 | $160,742 | $110,756 | $123,007 | $51,266 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $12,105 | $83,813 | $124,910 | $132,650 | $87,462 | $25,078 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.34% | 0.30% | 0.33% | 0.21% | 0.21% | 0.21% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.34% | 0.30% | 0.32% | 0.20% | 0.20% | 0.20% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 6.30% | 2.63% | 3.48% | 2.63% | 2.24% | 1.97% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 13% | 17% | 19% | 71% | 15% | 16% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(3) | Period from December 30, 2005 (inception date) through October 31, 2006. | |
(4) | See Note 6 in Notes to Financial Statements. | |
(5) | Formerly named Janus Smart Portfolio - Moderate. |
See Notes to Financial Statements.
Janus Asset Allocation Funds | 37
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Financial Highlights (continued)
Class T Shares
For a share outstanding during the six-month period ended | ||||||||||||||||||||||||||
December 31, 2010 (unaudited), the eight-month fiscal period | ||||||||||||||||||||||||||
ended June 30, 2010 and each fiscal year or period ended | Janus Conservative Allocation Fund(1) | |||||||||||||||||||||||||
October 31 | 2010 | 2010(2) | 2009 | 2008 | 2007 | 2006(3) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $11.26 | $11.09 | $9.52 | $12.09 | $10.82 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .30 | .72 | .38 | .33 | .26 | .13 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | .84 | (.20) | 1.52 | (2.46) | 1.23 | .69 | ||||||||||||||||||||
Total from Investment Operations | 1.14 | .52 | 1.90 | (2.13) | 1.49 | .82 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.42) | (.35) | (.33) | (.29) | (.20) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.15) | (.02) | – | ||||||||||||||||||||
Total Distributions and Other | (.42) | (.35) | (.33) | (.44) | (.22) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $11.98 | $11.26 | $11.09 | $9.52 | $12.09 | $10.82 | ||||||||||||||||||||
Total Return** | 10.11% | 4.70% | 20.71% | (18.26)% | 13.98% | 8.20% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $11,940 | $9,999 | $114,544 | $83,219 | $68,704 | $19,489 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $10,787 | $60,927 | $90,262 | $88,345 | $41,512 | $9,992 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.45% | 0.31% | 0.31% | 0.17% | 0.18% | 0.18% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.45% | 0.31% | 0.30% | 0.17% | 0.17% | 0.17% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 6.44% | 3.62% | 4.14% | 3.16% | 3.04% | 2.78% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 13% | 18% | 21% | 90% | 16% | 20% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Formerly named Janus Smart Portfolio - Conservative. | |
(2) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(3) | Period from December 30, 2005 (inception date) through October 31, 2006. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
38 | DECEMBER 31, 2010
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Notes to Schedules of Investments (unaudited)
Barclays Capital U.S. Aggregate Bond Index | An unmanaged market value weighted index for U.S. dollar-denominated investment-grade debt issues, including government, corporate, mortgage-backed, and asset-backed securities with maturities of at least one year. | |
Conservative Allocation Index | An internally calculated, hypothetical combination of unmanaged indices that combines the total returns from the Barclays Capital U.S. Aggregate Bond Index (60%), the Dow Jones Wilshire 5000 Index (28%) and the MSCI EAFE® Index (12%). | |
Dow Jones Wilshire 5000 Index | An index that measures the performance of all U.S. headquartered equity securities with readily available price data. Over 5,000 capitalization-weighted security returns are used and the Dow Jones Wilshire 5000 Index is considered one of the premier measures of the entire U.S. stock market. | |
Growth Allocation Index | An internally calculated, hypothetical combination of unmanaged indices that combines the total returns from the Dow Jones Wilshire 5000 Index (50%), the MSCI EAFE® Index (25%), the Barclays Capital U.S. Aggregate Bond Index (20%) and the MSCI Emerging Markets IndexSM (5%). | |
Lipper Mixed-Asset Target Allocation Conservative Funds | The Lipper Mixed-Asset Target Allocation Conservative Funds Average represents the average annual returns for all Mixed-Asset Target Allocation Conservative Funds for the respective time periods. | |
Lipper Mixed-Asset Target Allocation Growth Funds | The Lipper Mixed-Asset Target Allocation Growth Funds Average represents the average annual returns for all Mixed-Asset Target Allocation Growth Funds for the respective time periods. | |
Lipper Mixed-Asset Target Allocation Moderate Funds | Funds that, by portfolio practice, maintain a mix of between 40%-60% equity securities, with the remainder invested in bonds, cash, and cash equivalents. | |
Moderate Allocation Index | An internally calculated, hypothetical combination of unmanaged indices that combines the total returns from the Dow Jones Wilshire 5000 Index (40%), the Barclays Capital U.S. Aggregate Bond Index (40%), the MSCI EAFE® Index (18%) and the MSCI Emerging Markets IndexSM (2%). | |
Morgan Stanley Capital International EAFE® Index | A free float-adjusted market capitalization weighted index designed to measure developed market equity performance. The MSCI EAFE® Index is composed of companies representative of the market structure of developed market countries. The index includes reinvestment of dividends, net of foreign withholding taxes. | |
Morgan Stanley Capital International Emerging Markets IndexSM | A free float-adjusted market capitalization index that is designed to measure equity market performance in the global emerging markets. | |
S&P 500® Index | The Standard & Poor’s (“S&P”) 500® Index is a commonly recognized, market-capitalization weighted index of 500 widely held equity securities, designed to measure broad U.S. Equity performance. |
The following is a summary of the inputs that were used to value the Funds’ investments in securities and other financial instruments as of December 31, 2010. See Notes to Financial Statements for more information.
Valuation Inputs Summary (as of December 31, 2010)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Janus Growth Allocation Fund(1) | |||||||||||
Mutual Funds | |||||||||||
Equity Funds | $ | – | $ | 187,941,799 | $ | – | |||||
Fixed-Income Funds | – | 44,426,633 | – | ||||||||
Total Investments in Securities | $ | – | $ | 232,368,432 | $ | – | |||||
Janus Asset Allocation Funds | 39
Table of Contents
Notes to Schedules of Investments (unaudited) (continued)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Janus Moderate Allocation Fund(2) | |||||||||||
Mutual Funds | |||||||||||
Equity Funds | $ | – | $ | 154,072,781 | $ | – | |||||
Fixed-Income Funds | – | 94,932,237 | – | ||||||||
Total Investments in Securities | $ | – | $ | 249,005,018 | $ | – | |||||
Investments in Securities: | |||||||||||
Janus Conservative Allocation Fund(3) | |||||||||||
Mutual Funds | |||||||||||
Equity Funds | $ | – | $ | 71,599,508 | $ | – | |||||
Fixed-Income Funds | – | 106,160,928 | – | ||||||||
Total Investments in Securities | $ | – | $ | 177,760,436 | $ | – | |||||
(1) | Formerly named Janus Smart Portfolio – Growth. | |
(2) | Formerly named Janus Smart Portfolio – Moderate. | |
(3) | Formerly named Janus Smart Portfolio – Conservative. |
40 | DECEMBER 31, 2010
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Notes to Financial Statements (unaudited)
The following section describes the organization and significant accounting policies and provides more detailed information about the schedules and tables that appear throughout this report. In addition, the Notes to Financial Statements explain the methods used in preparing and presenting this report.
1. | Organization and Significant Accounting Policies |
Janus Growth Allocation Fund (formerly named Janus Smart Portfolio – Growth), Janus Moderate Allocation Fund (formerly named Janus Smart Portfolio – Moderate), and Janus Conservative Allocation Fund (formerly named Janus Smart Portfolio – Conservative) (individually, a “Fund” and collectively, the “Funds”) are series funds. The Funds each operate as a “fund of funds,” meaning substantially all of the Funds’ assets will be invested in other Janus funds (the “underlying funds”). The Funds are part of Janus Investment Fund (the “Trust”), which is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The financial statements include information for the six-month period ended December 31, 2010. The Trust offers forty funds which include multiple series of shares, with differing investment objectives and policies. Each Fund in this report is classified as diversified, as defined in the 1940 Act.
Each Fund in this report offers multiple classes of shares in order to meet the needs of various types of investors. Each class represents an interest in the same portfolio of investments. Certain financial intermediaries may not offer all classes of shares.
Class A Shares and Class C Shares are generally offered through financial intermediary platforms including, but not limited to, traditional brokerage platforms, mutual fund wrap fee programs, bank trust platforms, and retirement platforms. The maximum purchase in Class C Shares is $500,000 for any single purchase.
Class D Shares are generally no longer being made available to new investors who do not already have a direct account with the Janus funds. The Shares are available only to investors who held accounts directly with the Janus funds as of July 6, 2009 and to immediate family members or members of the same household of an eligible individual investor. The Shares are not offered through financial intermediaries.
Class I Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, and bank trust platforms, as well as certain retirement platforms. Class I Shares are also available to certain institutional investors including, but not limited to, corporations, certain retirement plans, public plans, and foundations/endowments.
Class S Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms and asset allocation, mutual fund wrap, or other discretionary or nondiscretionary fee-based investment advisory programs. In addition, Class S Shares may be available through certain financial intermediaries who have an agreement with Janus Capital Management LLC (“Janus Capital”) or its affiliates to offer Class S Shares on their supermarket platforms.
Class T Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, bank trust platforms, and certain retirement platforms. In addition, Class T Shares may be available through certain financial intermediaries who have an agreement with Janus Capital or its affiliates to offer Class T Shares on their supermarket platforms.
Underlying Funds
Each Fund invests in a variety of underlying funds to pursue a target allocation of stocks and bonds, and may also invest in money market instruments or cash/cash equivalents. Each Fund has a target allocation, which is how each Fund’s investments generally will be allocated among the major asset classes over the long term, as well as normal ranges within which each Fund’s asset class allocations generally will vary over short-term periods. The normal asset allocation ranges are as follows: (1) 75%-85% stocks and 15%-25% bonds and money market instruments for Janus Growth Allocation Fund; (2) 55%-65% stocks and 35%-45% bonds and money market instruments for Janus Moderate Allocation Fund; and (3) 35%-45% stocks and 55%-65% bonds and money market instruments for Janus Conservative Allocation Fund. Brief descriptions of each of the underlying funds that the Funds may invest in are as follows.
POTENTIAL UNDERLYING FUNDS INVESTING PRIMARILY IN EQUITY SECURITIES
INTECH RISK-MANAGED CORE FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the S&P 500® Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
INTECH RISK-MANAGED GROWTH FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Russell 1000® Growth Index. Stocks are selected for their potential contribution
Janus Asset Allocation Funds | 41
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Notes to Financial Statements (unaudited) (continued)
to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
INTECH RISK-MANAGED INTERNATIONAL FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Morgan Stanley Capital International (“MSCI”) EAFE® (Europe, Australasia, Far East) Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
INTECH RISK-MANAGED VALUE FUND seeks long-term growth of capital. The fund invests primarily in common stocks from the universe of the fund’s benchmark index, which is the Russell 1000® Value Index. Stocks are selected for their potential contribution to the long-term growth of capital, utilizing INTECH’s mathematical investment process.
JANUS BALANCED FUND seeks long-term capital growth, consistent with preservation of capital and balanced by current income. The fund pursues its investment objective by normally investing 35-65% of its assets in equity securities and the remaining assets in fixed-income securities and cash equivalents. The fund normally invests at least 25% of its assets in fixed-income senior securities. Fixed-income securities may include corporate debt securities, U.S. Government obligations, mortgage-backed securities and other mortgage-related products, and short-term investments.
JANUS CONTRARIAN FUND seeks long-term growth of capital. The fund pursues its investment objective by investing, under normal circumstances, at least 80% of its net assets in equity securities with the potential for long-term growth of capital. The portfolio manager emphasizes investments in companies with attractive price/free cash flow, which is the relationship between the price of a stock and the company’s available cash from operations minus capital expenditures. The portfolio manager will typically seek attractively valued companies that are improving their free cash flow and returns on invested capital. Such companies may also include special situations companies that are experiencing management changes and/or are currently out of favor.
JANUS EMERGING MARKETS FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of issuers in emerging market countries. The fund normally invests in securities of issuers that (i) are primarily listed on the trading market of an emerging market country; (ii) are incorporated or have their principal business activities in an emerging market country; or (iii) derive 50% or more of their revenues from, or have 50% or more of their assets in, an emerging market country. An emerging market country is any country that has been determined by an international organization, such as the World Bank, to have a low to middle income economy and/or any country that is not included in the Morgan Stanley Capital International World Index, which measures the equity market performance of developed markets. The fund generally invests in equity securities, which consist primarily of common stocks, preferred stocks and convertible securities, but may also invest in other types of instruments, such as equity-linked securities.
JANUS ENTERPRISE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential and normally invests at least 50% of its equity assets in medium-sized companies. Medium-sized companies are those whose market capitalization falls within the range of companies in the Russell Midcap® Growth Index.
JANUS FORTY FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 20-40 common stocks selected for their growth potential. The fund may invest in companies of any size, from larger, well-established companies to smaller, emerging growth companies.
JANUS FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. Although the fund may invest in companies of any size, it generally invests in larger, more established companies.
JANUS GLOBAL LIFE SCIENCES FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of companies that the portfolio manager believes have a life science orientation. Generally speaking, the “life sciences” relate to maintaining or improving quality of life. The fund implements this policy by investing primarily in equity securities of U.S. and foreign companies selected for their growth potential. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. As a fundamental policy, the fund normally invests at least 25% of its total assets in the “life sciences” sector, which may include companies in the following industry groups: health care; pharmaceuticals; agriculture; cosmetics/personal care; and biotechnology. The fund may have significant exposure to emerging markets.
JANUS GLOBAL RESEARCH FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected
42 | DECEMBER 31, 2010
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for their growth potential. The fund may invest in companies of any size located anywhere in the world, from larger, well-established companies to smaller, emerging growth companies. The fund normally invests at least 40% of its net assets in securities of issuers from different countries located throughout the world, excluding the United States. The fund may have significant exposure to emerging markets.
JANUS GLOBAL SELECT FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 30-50 domestic and foreign common stocks selected for their growth potential and normally investing at least 40% of its net assets in securities of issuers from different countries located throughout the world, excluding the United States. The fund may invest in companies of any size, located anywhere in the world, from larger, well-established companies to smaller, emerging growth companies. The fund may also invest in U.S. and foreign debt securities. The fund may have significant exposure to emerging markets.
JANUS GLOBAL TECHNOLOGY FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of companies that the portfolio manager believes will benefit significantly from advances or improvements in technology. These companies generally fall into two categories: (i) companies that the portfolio manager believes have or will develop products, processes, or services that will provide significant technological advancements or improvements and (ii) companies that the portfolio manager believes rely extensively on technology in connection with their operations or services. The fund implements this policy by investing primarily in equity securities of U.S. and foreign companies selected for their growth potential. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
JANUS GROWTH AND INCOME FUND seeks long-term capital growth and current income. The fund pursues its investment objective by normally emphasizing investments in common stocks. The fund will normally invest up to 75% of its assets in equity securities selected primarily for their growth potential and at least 25% of its assets in securities the portfolio manager believes have income potential. Eligible equity securities in which the fund may invest include: (i) domestic and foreign common stocks; (ii) preferred stocks; (iii) securities convertible into common stocks or preferred stocks, such as convertible preferred stocks, bonds, and debentures; and (iv) other securities with equity characteristics.
JANUS INTERNATIONAL EQUITY FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in equity securities. The fund normally invests in a core group of 60-100 equity securities of issuers from different countries located throughout the world, excluding the United States. The fund may, under unusual circumstances, invest all of its assets in a single country. The fund may invest in emerging markets but will normally limit such investments to 20% of its net assets, measured at the time of purchase. The fund may also invest in foreign debt securities.
JANUS OVERSEAS FUND seeks long-term growth of capital. The fund invests, under normal circumstances, at least 80% of its net assets in securities of issuers from countries outside of the United States. The fund normally invests in securities of issuers from several different countries, excluding the United States. Although the fund intends to invest substantially all of its assets in issuers located outside the United States, it may at times invest in U.S. issuers, and it may, under unusual circumstances, invest all of its assets in a single country. The fund may have significant exposure to emerging markets.
JANUS RESEARCH CORE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in equity securities selected for their growth potential. Eligible equity securities in which the fund may invest include: (i) domestic and foreign common stocks; (ii) preferred stocks; (iii) securities convertible into common stocks or preferred stocks, such as convertible preferred stocks, bonds, and debentures; and (iv) other securities with equity characteristics (including the use of derivatives). The fund may invest in companies of any size. Effective January 28, 2011, Janus Research Core Fund merged into Janus Growth and Income Fund.
JANUS RESEARCH FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. The fund may invest in companies of any size, from larger, well-established companies to smaller, emerging growth companies.
JANUS TRITON FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks selected for their growth potential. In pursuing that objective, the fund invests in equity securities of small- and medium-sized companies. Generally, small- and medium-sized companies have a market capitalization of less than $10 billion. Market capitalization is a commonly used measure of the size and value of a company.
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Notes to Financial Statements (unaudited) (continued)
JANUS TWENTY FUND seeks long-term growth of capital. The fund pursues its investment objective by normally investing primarily in a core group of 20-30 common stocks selected for their growth potential.
JANUS VENTURE FUND seeks capital appreciation. The fund pursues its investment objective by investing at least 50% of its equity assets in small-sized companies. Small-sized companies are those who have market capitalizations of less than $1 billion or annual gross revenues of less than $500 million. Companies whose capitalization or revenues fall outside these ranges after the fund’s initial purchase continue to be considered small-sized. The fund may also invest in larger companies with strong growth potential or relatively well-known and large companies with potential for capital appreciation.
JANUS WORLDWIDE FUND seeks long-term growth of capital in a manner consistent with the preservation of capital. The fund pursues its investment objective by investing primarily in common stocks of companies of any size located throughout the world. The fund normally invests in issuers from several different countries, including the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
PERKINS GLOBAL VALUE FUND seeks long-term growth of capital. The fund pursues its investment objective by investing primarily in common stocks of companies of any size located throughout the world with the potential for long-term growth of capital. The fund normally invests in issuers from several different countries, which may include the United States. The fund may, under unusual circumstances, invest in a single country. The fund may have significant exposure to emerging markets.
PERKINS LARGE CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in common stocks selected for their capital appreciation potential. The fund primarily invests in the common stocks of large-sized companies whose stock prices the portfolio managers believe to be undervalued. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of companies having, at the time of purchase, market capitalizations equal to or greater than the median market capitalization of companies included in the Russell 1000® Value Index.
PERKINS MID CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in common stocks selected for their capital appreciation potential. The fund primarily invests in the common stocks of mid-sized companies whose stock prices the portfolio managers believe to be undervalued. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of companies whose market capitalization falls, at the time of purchase, within the 12-month average of the capitalization range of the Russell Midcap® Value Index.
PERKINS SMALL CAP VALUE FUND seeks capital appreciation. The fund pursues its investment objective by investing primarily in the common stocks of small companies whose stock prices are believed to be undervalued by the fund’s portfolio managers. The fund invests, under normal circumstances, at least 80% of its assets in equity securities of small companies whose market capitalization, at the time of initial purchase, is less than the 12-month average of the maximum market capitalization for companies included in the Russell 2000® Value Index.
PERKINS VALUE PLUS INCOME FUND seeks capital appreciation and current income. The fund pursues its investment objective by normally investing 40-60% of its assets in equity securities selected primarily for capital appreciation and investing the remainder in fixed-income securities and cash equivalents. The fund’s equity investments generate total return from a combination of capital appreciation and, to a lesser degree, current income. Such equity investments may include companies of any size, but the fund will invest primarily in large- and mid-sized companies whose stock prices the portfolio managers believe to be undervalued or have the potential for high relative dividend yields, or both. The fund’s fixed-income investments generate total return from a combination of current income and capital appreciation, but income is usually the dominant portion. The fund normally invests the portion of its assets allocated to fixed-income investments in debt securities (including, but not limited to, government bonds, corporate bonds, mortgage-backed securities, and zero-coupon bonds), convertible securities, and short-term securities. The fund invests at least 50% of the fixed-income portion of its assets in investment grade debt securities. The fund will limit its investment in high-yield/high-risk bonds, also known as “junk” bonds, to 50% or less of the fixed-income portion of its net assets.
POTENTIAL UNDERLYING FUNDS INVESTING PRIMARILY IN FIXED-INCOME SECURITIES
JANUS FLEXIBLE BOND FUND seeks to obtain maximum total return, consistent with preservation of capital. The fund pursues its investment objective by primarily investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, government bonds, corporate bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The fund will invest at least 65% of its assets in investment grade debt securities and will maintain an average-weighted effective maturity of five to ten years. The fund
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will limit its investment in high-yield/high-risk bonds to 35% or less of its net assets. The fund generates total return from a combination of current income and capital appreciation, but income is usually the dominant portion.
JANUS GLOBAL BOND FUND seeks total return, consistent with preservation of capital. The fund pursues its investment objective by investing, under normal circumstances, at least 80% of its net assets in bonds. Bonds include, but are not limited to, corporate bonds, government bonds, convertible bonds, mortgage-backed securities, and zero-coupon bonds. The fund invests in corporate debt securities of issuers in a number of different countries, which may include the United States. The fund invests in securities of issuers located in developed and emerging market countries. The fund may invest across all fixed-income sectors, including U.S. and non-U.S. government securities. The fund’s investments may be denominated in local currency or U.S. dollar-denominated. The fund may invest in debt securities with a range of maturities from short- to long-term. The fund may invest up to 35% of its net assets in high-yield/high-risk debt securities. The fund may also invest in preferred and common stock, money market instruments, municipal bonds, commercial and residential mortgage-backed securities, asset-backed securities, other securitized and structured debt products, private placements, and other investment companies, including exchange-traded funds (“ETFs”). The fund may also invest in floating rate loans, buy backs or dollar rolls, and reverse repurchase agreements.
JANUS HIGH-YIELD FUND seeks to obtain high current income. Capital appreciation is a secondary investment objective when consistent with its primary objective. The fund pursues its investment objectives by investing, under normal circumstances, at least 80% of its net assets in high-yield/high-risk securities rated below investment grade. Securities rated below investment grade may include their unrated equivalents or other high-yielding securities the portfolio managers believe offer attractive risk/return characteristics. The fund may at times invest all of its assets in such securities.
JANUS SHORT-TERM BOND FUND seeks as high a level of current income as is consistent with preservation of capital. The fund invests, under normal circumstances, at least 80% of its net assets in short- and intermediate-term securities such as corporate bonds or notes or government securities, including agency securities. The fund may invest up to 35% of its net assets in high-yield/high-risk bonds. The fund expects to maintain an average-weighted effective maturity of three years or less under normal circumstances.
POTENTIAL UNDERLYING FUNDS PRIMARILY UTILIZING ALTERNATIVE STRATEGIES
JANUS GLOBAL REAL ESTATE FUND seeks total return through a combination of capital appreciation and current income. The fund invests, under normal circumstances, at least 80% of its net assets plus the amount of any borrowings for investment purposes in equity and debt securities of real estate-related companies. Such companies may include those in the real estate industry or real estate-related industries. These securities may include common stocks, preferred stocks, and other equity securities, including, but not limited to, real estate investment trusts (“REITs”) and similar REIT-like entities. As a fundamental policy, the fund will concentrate 25% or more of its net assets in securities of issuers in real estate or real estate-related industries. The fund’s investment in companies engaged in businesses outside the real estate industry which possess significant real estate holdings will be deemed to be in the real estate industry for purposes of the fund’s investment objective and its policy on industry concentration. The fund expects under normal market conditions to maintain investments in issuers from several different developed countries, including the United States. Under unusual circumstances, the fund may invest all of its assets in a single country. The fund may invest in emerging markets but will normally limit such investments to 15% of its net assets, measured at the time of purchase.
JANUS LONG/SHORT FUND seeks long-term capital appreciation with an emphasis on absolute returns. Under normal circumstances, the fund generally pursues its investment objective by taking both long and short positions in domestic and foreign equity securities, including those in emerging markets, and exchange-traded funds (“ETFs”) that invest primarily in equity securities. The fund’s portfolio managers believe that a combination of long and short positions may provide positive returns regardless of market conditions through a complete market cycle and may offer reduced risk. The fund will generally buy long securities that the portfolio managers believe will go up in price and will sell short ETFs and other equity securities the portfolio managers believe will go down in price. The fund may, to a lesser degree, also take long and short positions in instruments that provide additional exposure to the equity markets, including options, futures, and other index-based instruments. The fund’s investments may include holdings across different industries, sectors, and regions.
The following accounting policies have been followed by the Funds and are in conformity with accounting principles generally accepted in the United States of America within the investment management industry.
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Notes to Financial Statements (unaudited) (continued)
Investment Valuation
A Fund’s net asset value (“NAV”) is partially calculated based upon the NAV of each of the underlying funds in which the Fund invests on the day of valuation. The NAV for each class of an underlying fund is computed by dividing the total value of securities and other assets allocated to the class, less liabilities allocated to that class, by the total number of shares outstanding for the class.
Securities held by the underlying funds are valued at the last sales price or the official closing price for securities traded on a principal securities exchange (U.S. or foreign) and on the NASDAQ National Market. Securities held by the underlying funds traded on over-the-counter (“OTC”) markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the underlying funds’ Trustees. Short-term securities held by the underlying funds with maturities of 60 days or less may be valued at amortized cost, which approximates market value. Debt securities held by the underlying funds with a remaining maturity of greater than 60 days are valued in accordance with the evaluated bid price supplied by the pricing service. The evaluated bid price supplied by the pricing service is an evaluation that reflects such factors as security prices, yields, maturities and ratings. Short positions shall be valued in accordance with the same methodologies, except that in the event that a last sale price is not available, the latest ask price shall be used instead of a bid price. Foreign securities and currencies held by the underlying funds are converted to U.S. dollars using the applicable exchange rate in effect as of the daily close of the New York Stock Exchange (“NYSE”). When market quotations are not readily available or deemed unreliable, or events or circumstances that may affect the value of portfolio securities held by the underlying funds are identified between the closing of their principal markets and the time the NAV is determined, securities may be valued at fair value as determined in good faith under procedures established by and under the supervision of the underlying funds’ Trustees. Circumstances in which fair value pricing may be utilized include, but are not limited to: (i) a significant event that may affect the securities of a single issuer, such as a merger, bankruptcy, or significant issuer specific development; (ii) an event that may affect an entire market, such as a natural disaster or significant governmental action; (iii) a nonsignificant event such as a market closing early or not opening, or a security trading halt; and (iv) pricing of a non-valued security and a restricted or non-public security. The underlying funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. Restricted and illiquid securities are valued in accordance with procedures established by the underlying funds’ Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from foreign securities held by the underlying funds will be recorded as soon as the Trust is informed of the dividend, if such information is obtained subsequent to the ex-dividend date. Dividends from foreign securities may be subject to withholding taxes in foreign jurisdictions. Interest income of the underlying funds is recorded on the accrual basis and includes amortization of premiums and accretion of discounts. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes. Income, as well as gains and losses, both realized and unrealized, are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets.
Expenses
Each Fund bears expenses incurred specifically on its behalf, as well as a portion of general expenses, which may be allocated pro rata to each of the funds in the Trust. Additionally, each Fund, as a shareholder in the underlying funds, will also indirectly bear its pro rata share of the expenses incurred by the underlying funds. Each class of shares bears expenses incurred specifically on its behalf and, in addition, each class bears a portion of general expenses, which are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets. Expenses directly attributable to a specific class of shares are charged against the operations of such class.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translations
The underlying funds do not isolate that portion of the results of operations resulting from the effect of changes in foreign exchange rates on investments from the
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fluctuations arising from changes in market prices of securities held at the date of the financial statements. Net unrealized appreciation or depreciation of investments and foreign currency translations arise from changes in the value of assets and liabilities, including investments in securities held at the date of the financial statements, resulting from changes in the exchange rates and changes in market prices of securities held.
Currency gains and losses of the underlying funds are also calculated on payables and receivables that are denominated in foreign currencies. The payables and receivables are generally related to foreign security transactions and income.
Foreign currency-denominated assets and forward currency contracts of the underlying funds may involve more risks than domestic transactions, including currency risk, political and economic risk, regulatory risk and equity risk. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of foreign currencies relative to the U.S. dollar.
Dividend Distributions
The Funds generally declare and distribute dividends of net investment income and realized capital gains (if any) annually. The majority of dividends and capital gains distributions from a Fund may be automatically reinvested into additional shares of that Fund, based on the discretion of the shareholder.
The underlying funds may make certain investments in REITs which pay dividends to their shareholders based upon funds available from operations. It is quite common for these dividends to exceed the REITs’ taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of capital. If the underlying funds distribute such amounts, such distributions could constitute a return of capital to shareholders for federal income tax purposes.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial statements, as the Funds intend to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code applicable to regulated investment companies.
In accordance with the Financial Accounting Standards Board (“FASB”) guidance, the Funds adopted the provisions of “Income Taxes.” These provisions require an evaluation of tax positions taken (or expected to be taken) in the course of preparing a Fund’s tax returns to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense on the Statements of Operations.
These provisions require management of the Funds to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of and during the period ended December 31, 2010, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examinations in progress and are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Valuation Inputs Summary
In accordance with FASB guidance, the Funds utilize the “Fair Value Measurements” to define fair value, establish a framework for measuring fair value, and expand disclosure requirements regarding fair value measurements. The Fair Value Measurement Standard does not require new fair value measurements, but is applied to the extent that other accounting pronouncements require or permit fair value measurements. This standard emphasizes that fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. Various inputs are used in determining the value of the Funds’ investments defined pursuant to this standard. These inputs are summarized into three broad levels:
Level 1 – Quoted prices in active markets for identical securities.
Level 2 – Prices determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use in pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others.
Debt securities are valued in accordance with the evaluated bid price supplied by the pricing service and generally categorized as Level 2 in the hierarchy. Securities traded on OTC markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof)
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Notes to Financial Statements (unaudited) (continued)
obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees and are categorized as Level 2 in the hierarchy. Short-term securities with maturities of 60 days or less are valued at amortized cost, which approximates market value and are categorized as Level 2 in the hierarchy. Other securities that are categorized as Level 2 in the hierarchy include, but are not limited to, preferred stocks, bank loans, American Depositary Receipts (ADRs), Global Depositary Receipts (GDRs), warrants, swaps, investments in mutual funds, OTC options, and forward contracts. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. These are generally categorized as Level 2 in the hierarchy.
Level 3 – Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the security and would be based on the best information available under the circumstances.
For restricted equity securities and private placements where observable inputs are limited, assumptions about market activity and risk are used in employing valuation techniques such as the market approach, the income approach, or the cost approach, as defined under the FASB Guidance. These are categorized as Level 3 in the hierarchy.
There have been no significant changes in valuation techniques used in valuing any such positions held by the Funds since the beginning of the fiscal year.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of inputs used as of December 31, 2010 to value the Funds’ investments in securities and other financial instruments is included in the “Valuation Inputs Summary” and “Level 3 Valuation Reconciliation of Assets” (if applicable) in the Notes to Schedules of Investments.
In April 2009, FASB issued “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly,” which provides additional guidance for estimating fair value in accordance with Fair Value Measurements when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. Additionally, it amends the Fair Value Measurement Standard by expanding disclosure requirements for reporting entities surrounding the major categories of assets and liabilities carried at fair value. The required disclosures have been incorporated into the “Valuation Inputs Summary” in the Notes to Schedules of Investments. Management believes applying this guidance does not have a material impact on the financial statements.
The Funds adopted FASB Accounting Standards Update “Fair Value Measurements and Disclosures” (the “Update”), effective June 30, 2010. This Update applies to a Fund’s disclosures about transfers in and out of Level 1 and Level 2 of the fair value hierarchy and the reasons for the transfers. Disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy are summarized under the Level 2 and Level 3 categories listed above. There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period.
The Funds recognize transfers between the levels as of the beginning of the fiscal year.
2. | Derivative Instruments |
The underlying funds may invest in various types of derivatives which may at times result in significant derivative exposure. A derivative is a financial instrument whose performance is derived from the performance of another asset. The underlying funds may invest in derivative instruments including, but not limited to: futures contracts, put options, call options, options on future contracts, options on foreign currencies, swaps, forward contracts, structured investments, and other equity-linked derivatives. A summary of derivative activity is reflected in the tables at the end of this section, if applicable.
The underlying funds may use derivative instruments for hedging (to offset risks associated with an investment, currency exposure, or market conditions) or for speculative (to seek to enhance returns) purposes. When the underlying funds invest in a derivative for speculative purposes, the underlying funds will be fully exposed to the risks of loss of that derivative, which may sometimes be greater than the cost of the derivative. The underlying funds may not use any derivative to gain exposure to an asset or class of assets prohibited by their investment restrictions from purchasing directly. An underlying fund’s ability to use derivative instruments may also be limited by tax considerations.
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Investments in derivatives are generally subject to equity risks that may cause their prices to fluctuate over time. Investments in derivatives may not directly correlate with the price movements of the underlying instrument. As a result, the use of derivatives may expose the underlying funds to additional risks that they would not be subject to if they invested directly in the securities underlying those derivatives. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case. Derivatives can be volatile and may involve significant risks, including, but not limited to, counterparty risk, credit risk, currency risk, equity risk, index risk, interest rate risk, leverage risk, and liquidity risk.
Derivatives may generally be traded OTC or on an exchange. Derivatives traded OTC, such as structured notes, are agreements that are individually negotiated between parties and can be tailored to meet a purchaser’s needs. OTC derivatives are not guaranteed by a clearing agency and may be subject to increased credit risk.
In an effort to mitigate credit risk associated with derivatives traded OTC, certain underlying funds may enter into collateral agreements with certain counterparties whereby, subject to certain minimum exposure requirements, certain underlying funds may require the counterparty to post collateral if an underlying fund has a net aggregate unrealized gain on all OTC derivative contracts with a particular counterparty. There is no guarantee that counterparty exposure is reduced and these arrangements are dependent on Janus Capital’s ability to establish and maintain appropriate systems and trading.
In pursuit of their investment objectives, each underlying fund may seek to use derivatives to increase or decrease exposure to the following market risk factors:
• | Counterparty Risk – Counterparty risk is the risk that the counterparty or a third party will not fulfill its obligation to an underlying fund. | |
• | Credit Risk – Credit risk is the risk an issuer will be unable to make principal and interest payments when due, or will default on its obligations. | |
• | Currency Risk – Currency risk is the risk that changes in the exchange rate between currencies will adversely affect the value (in U.S. dollar terms) of an investment. | |
• | Equity Risk – Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market. | |
• | Index Risk – If the derivative is linked to the performance of an index, it will be subject to the risks associated with changes in that index. If the index changes, an underlying fund could receive lower interest payments or experience a reduction in the value of the derivative to below what the underlying fund paid. Certain indexed securities, including inverse securities (which move in an opposite direction to the index), may create leverage, to the extent that they increase or decrease in value at a rate that is a multiple of the changes in the applicable index. | |
• | Interest Rate Risk – Interest rate risk is the risk that the value of fixed-income securities will generally decline as prevailing interest rates rise, which may cause an underlying fund’s NAV to likewise decrease, and vice versa. | |
• | Leverage Risk – Leverage risk is the risk associated with certain types of leveraged investments or trading strategies pursuant to which relatively small market movements may result in large changes in the value of an investment. An underlying fund creates leverage by using borrowed capital to increase the amount invested, or investing in instruments, including derivatives, where the investment loss can exceed the original amount invested. Certain investments or trading strategies that involve leverage can result in losses that greatly exceed the amount originally invested. | |
• | Liquidity Risk – Liquidity risk is the risk that certain securities may be difficult or impossible to sell at the time that the seller would like or at the price that the seller believes the security is currently worth. |
Equity-Linked Structured Notes
The underlying funds, except INTECH Risk-Managed Core Fund, INTECH Risk-Managed Growth Fund, INTECH Risk-Managed International Fund, and INTECH Risk-Managed Value Fund (together, the “Risk-Managed funds”), may invest in equity-linked structured notes. Equity-linked structured notes are derivative securities which are specially designed to combine the characteristics of one or more underlying securities and their equity derivatives in a single note form. The return and/or yield or income component may be based on the performance of the underlying equity securities, an equity index, and/or option positions. Equity-linked structured notes are typically offered in limited transactions by financial institutions in either registered or non-registered form. An investment in equity-linked structured notes creates exposure to the credit risk of the issuing financial institution, as well as to the equity risk of the underlying securities. There is no guaranteed return of principal with
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Notes to Financial Statements (unaudited) (continued)
these securities and the appreciation potential of these securities may be limited by a maximum payment or call right. In certain cases, equity-linked structured notes may be more volatile and less liquid than less complex securities or other types of fixed-income securities. Such securities may exhibit price behavior that does not correlate with other fixed-income securities.
Forward Foreign Currency Exchange Contracts
A forward foreign currency exchange contract (“forward currency contract”) is a commitment to purchase or sell a foreign currency at a future date at a negotiated rate. The underlying funds, except the Risk-Managed funds, may enter into forward currency contracts for hedging purposes, including, but not limited to, reducing exposure to changes in foreign currency exchange rates on foreign portfolio holdings of the underlying funds and locking in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in or exposed to foreign currencies. The underlying funds may also invest in forward currency contracts for nonhedging purposes such as seeking to enhance returns. The underlying funds are subject to currency risk in the normal course of pursuing their investment objectives through their investments in forward currency contracts.
The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing a contract is included in “Net realized gain/(loss) from investment and foreign currency transactions” on the underlying funds’ Statements of Operations in their most recent annual or semiannual reports (if applicable).
Forward currency contracts held by the underlying funds are fully collateralized by other securities, which are denoted on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). The collateral is evaluated daily to ensure its market value equals or exceeds the current market value of the corresponding forward currency contracts. Such collateral is in the possession of the underlying funds’ custodian.
Futures Contracts
A futures contract is an exchange-traded agreement to take or make delivery of an underlying asset at a specific time in the future for a specific predetermined negotiated price. The underlying funds may enter into futures contracts to gain exposure to the stock market pending investment of cash balances or to meet liquidity needs. The underlying funds are subject to interest rate risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in futures contracts. The underlying funds may also use such derivative instruments to hedge or protect from adverse movements in securities prices, currency rates or interest rates. The use of futures contracts may involve risks such as the possibility of illiquid markets or imperfect correlation between the values of the contracts and the underlying securities, or that the counterparty will fail to perform its obligations.
Futures contracts are marked-to-market daily, and the daily variation margin is recorded as a receivable or payable on the underlying funds’ Statements of Assets and Liabilities in their most recent annual or semiannual reports (if applicable). When a contract is closed, a realized gain or loss is recorded as “Net realized gain/(loss) from futures contracts” on the underlying funds’ Statements of Operations in their most recent annual or semiannual reports (if applicable), equal to the difference between the opening and closing value of the contract. Generally, futures contracts are marked-to-market (i.e., treated as realized and subject to distribution) for federal income tax purposes at fiscal year-end. Securities of the underlying funds that are designated as collateral for market value on futures contracts are noted on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). Such collateral is in the possession of the underlying funds’ custodian or with the counterparty broker.
With futures, there is minimal counterparty credit risk to the underlying funds since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Options Contracts
An options contract provides the purchaser with the right, but not the obligation, to buy (call option) or sell (put option) a financial instrument at an agreed upon price. The underlying funds may purchase or write covered and uncovered put and call options on futures contracts and on portfolio securities for hedging purposes or as a substitute for an investment. The underlying funds are subject to interest rate risk, liquidity risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in options contracts. The underlying funds may use options contracts to hedge against changes in interest rates, the values of equities, or foreign currencies. The underlying funds may utilize American-style and European-style options. An American-style option is an option contract that can be exercised at any time between the time of purchase and the option’s expiration date. A European-style option is an option contract that can only be exercised on the option’s expiration date. The underlying funds, except the Risk-Managed funds, may also purchase or write put and call
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options on foreign currencies in a manner similar to that in which futures or forward contracts on foreign currencies will be utilized. The underlying funds may also invest in long-term equity anticipation securities, which are long-term option contracts that can be maintained for a period of up to three years. The underlying funds generally invest in options to hedge against adverse movements in the value of portfolio holdings.
When an option is written, the underlying funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. In writing an option, the underlying funds bear the risk of an unfavorable change in the price of the security underlying the written option. Exercise of an option written by the underlying funds could result in the underlying funds buying or selling a security at a price different from the current market value.
When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option are adjusted by the amount of premium received or paid by the underlying funds.
The underlying funds may also purchase and write exchange-listed and OTC put and call options on domestic securities indices, and on foreign securities indices listed on domestic and foreign securities exchanges. Options on securities indices are similar to options on securities except that (1) the expiration cycles of securities index options are monthly, while those of securities options are currently quarterly, and (2) the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a securities index gives the holder the right to receive a cash “exercise settlement amount” equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of exercise, multiplied by (b) a fixed “index multiplier.” Receipt of this cash amount will depend upon the closing level of the securities index upon which the option is based being greater than, in the case of a call, or less than, in the case of a put, the exercise price of the index and the exercise price of the option times a specified multiple. The writer of the option is obligated, in return for the premium received, to make delivery of this amount.
Options traded on an exchange are regulated and the terms of the options are standardized. Options traded OTC expose the underlying funds to counterparty risk in the event that the counterparty does not perform. This risk is mitigated by having a netting arrangement between the underlying funds and the counterparty and by having the counterparty post collateral to cover the underlying funds’ exposure to the counterparty.
Holdings of the underlying funds designated to cover outstanding written options are noted on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). Options written are reported as a liability on the underlying funds’ Statements of Assets and Liabilities as “Options written at value” in their most recent annual or semiannual reports (if applicable).
Realized gains and losses are reported as “Net realized gain/(loss) from options contracts” on the underlying funds’ Statements of Operations in their most recent annual or semiannual reports (if applicable).
The risk in writing call options is that the underlying funds give up the opportunity for profit if the market price of the security increases and the options are exercised. The risk in writing put options is that the underlying funds may incur a loss if the market price of the security decreases and the options are exercised. The risk in buying options is that the underlying funds pay a premium whether or not the options are exercised. The use of such instruments may involve certain additional risks as a result of unanticipated movements in the market. A lack of correlation between the value of an instrument underlying an option and the asset being hedged, or unexpected adverse price movements, could render the underlying funds’ hedging strategy unsuccessful. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased or sold. There is no limit to the loss the underlying funds may recognize due to written call options.
Other Options
In addition to the option strategies described above, certain underlying funds may purchase and sell a variety of options with non-standard payout structures or other features (“exotic options”). Exotic options are traded OTC and typically have price movements that can vary markedly from simple put or call options. The risks associated with exotic options are that they cannot be as easily priced and may be subject to liquidity risk. While some exotic options have fairly active markets, others are mostly thinly traded instruments. Some options are pure two-party transactions and may have no liquidity. Certain underlying funds may treat such instruments as illiquid and will limit their investments in such instruments to no more than 15% of the underlying fund’s net assets, when combined with all other illiquid investments of the underlying fund. Certain underlying funds may use exotic options to the extent that they are consistent with the underlying fund’s investment objective and investment policies, and applicable regulations.
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Notes to Financial Statements (unaudited) (continued)
Certain underlying funds may purchase and sell exotic options that have values which are determined by the correlation of two or more underlying assets. These types of options include, but are not limited to, outperformance options, yield curve options or other spread options.
Swaps
A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The underlying funds, except the Risk-Managed funds, may utilize swap agreements as a means to gain exposure to certain common stocks and/or to “hedge” or protect their portfolios from adverse movements in securities prices or interest rates. The underlying funds are subject to equity risk and interest rate risk in the normal course of pursuing their investment objectives through investments in swap contracts. Swap agreements entail the risk that a party will default on its payment obligation to an underlying fund. If the other party to a swap defaults, an underlying fund would risk the loss of the net amount of the payments that it contractually is entitled to receive. If an underlying fund utilizes a swap at the wrong time or judges market conditions incorrectly, the swap may result in a loss to the underlying fund and reduce the underlying fund’s total return. Swap contracts of the underlying funds are reported as an asset or liability on the underlying funds’ Statements of Assets and Liabilities in their most recent annual or semiannual reports (if applicable). Realized gains and losses of the underlying funds are reported in “Net realized gain/(loss) from swap contracts” on the underlying funds’ Statements of Operations in their most recent annual or semiannual reports (if applicable).
Various types of swaps such as credit default (funded and unfunded), dividend, equity, interest rate, and total return swaps are described below.
Credit default swaps are a specific kind of counterparty agreement that allows the transfer of third-party credit risk from one party to the other. The underlying funds are subject to credit risk in the normal course of pursuing their investment objectives through their investments in credit default swap contracts. The underlying funds may enter into credit default swaps to manage their exposure to the market or certain sectors of the market, to reduce their risk exposure to defaults of corporate and sovereign issuers, or to create exposure to corporate or sovereign issuers to which they are not otherwise exposed. With a credit default swap, one party in the swap is a lender and faces credit risk from a third party, and the counterparty in the credit default swap agrees to insure this risk in exchange for regular periodic payments. The underlying funds’ maximum risk of loss from counterparty risk, either as protection sellers or as protection buyers (undiscounted), is the notional value of the agreement. The risk is mitigated by having a netting arrangement between the underlying funds and the counterparty and by posting of collateral by the counterparty to the underlying funds to cover the underlying funds’ exposure to the counterparty.
Funded (notional value of contract paid up front) or unfunded (notional value only paid in case of default) credit default swaps are based on an index of credit default swaps (“CDXs”) or other similarly structured products. CDXs are designed to track segments of the credit default swap market and provide investors with exposure to specific reference baskets of issuers of bonds or loans. These instruments have the potential to allow an investor to obtain the same investment exposure as an investor who invests in an individual credit default swap, but with the potential added benefit of diversification. The CDX reference baskets are normally priced daily and rebalanced every six months in conjunction with leading market makers in the credit industry. The liquidity of the market for CDXs is normally subject to liquidity in the secured loan and credit derivatives markets. Certain underlying funds are normally only permitted to take long positions in CDXs.
Dividend swap agreements involve an exchange by the parties of their respective commitments to pay or right to receive the changes in a dividend index point. The underlying funds gain exposure by either paying or receiving an amount in respect of an increase or decrease in the change of the relevant dividend index point based on a notional amount. For example, if an underlying fund took a long position on a dividend index swap, the underlying fund would receive payments if the relevant index point increased in value and would be obligated to pay if that index point decreased in value.
Equity swaps involve the exchange by two parties of future cash flow (e.g., one cash flow based on a referenced interest rate and the other based on the performance of stock or a stock index).
Interest rate swaps involve the exchange by two parties of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments).
Total return swaps involve an exchange by two parties in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income it generates and any capital gains over the payment period.
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The underlying funds’ maximum risk of loss for equity swaps, interest rate swaps and total return swaps from counterparty risk or credit risk is the discounted value of the payments to be received from/paid to the counterparty over the contract’s remaining life, to the extent that the amount is positive. The risk is mitigated by having a netting arrangement between the underlying funds and the counterparty and by the posting of collateral to the underlying funds to cover the underlying funds’ exposure to the counterparty.
In accordance with FASB guidance, the Funds adopted the provisions for “Derivative and Hedging,” which require qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. There were no derivatives held by the Funds during the period ended December 31, 2010.
3. | Other Investments and Strategies |
Additional Investment Risk
The underlying funds, particularly Janus Flexible Bond Fund, Janus Global Bond Fund, Janus High-Yield Fund and Janus Short-Term Bond Fund, may be invested in lower-rated debt securities that have a higher risk of default or loss of value since these securities may be sensitive to economic changes, political changes or adverse developments specific to the issuer. The Risk-Managed funds do not intend to invest in high-yield/high-risk bonds.
Unforeseen events in both domestic and international equity and fixed-income markets have resulted, and may continue to result, in an unusually high degree of volatility in the markets, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. These events and the resulting market upheavals may have an adverse effect on the underlying funds, such as a decline in the value and liquidity of many securities held by the underlying funds, unusually high and unanticipated levels of redemptions, an increase in portfolio turnover, a decrease in NAV, and an increase in underlying fund expenses and therefore an increase in Fund expenses. Such unforeseen events may make it unusually difficult to identify both investment risks and opportunities and could limit or preclude the underlying funds’ ability to achieve their investment objective. The market’s behavior may at times be unpredictable. Therefore, it is important to understand that the value of your investment may fall, sometimes sharply, and you could lose money.
Further, the recent instability experienced in the financial markets has resulted in the U.S. Government and various other governmental and regulatory entities taking actions to address the financial crisis. These actions include, but are not limited to, the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in July 2010 which is expected to dramatically change the way in which the U.S. financial system is supervised and regulated. More specifically, the Dodd-Frank Act provides for widespread regulation of financial institutions, consumer financial products and services, broker-dealers, over-the-counter derivatives, investment advisers, credit rating agencies, and mortgage lending, which expands federal oversight in the financial sector and may affect the investment management industry as a whole. Given the broad scope, sweeping nature, and the fact that many provisions of the Dodd-Frank Act must be implemented through future rulemaking, the ultimate impact of the Dodd-Frank Act, and any resulting regulation, is not yet certain. As a result, there can be no assurance that these measures will not have an adverse effect on the value or marketability of securities held by a Fund, including potentially limiting or completely restricting the ability of the Fund to use a particular investment instrument as part of its investment strategy, increasing the costs of using these instruments, or possibly making them less effective in general. Furthermore, no assurance can be made that the U.S. Government or any U.S. regulatory entity (or other authority or regulatory entity) will not continue to take further legislative or regulatory action in response to the economic crisis or otherwise, and the effect of such actions, if taken, cannot be known.
Bank Loans
Certain underlying funds, particularly Janus Balanced Fund, Janus Flexible Bond Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may invest in bank loans, which include institutionally traded floating rate securities generally acquired as an assignment from another holder of, or participation interest in, loans originated by a bank or financial institution (the “Lender”) that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. When investing in a loan participation, the underlying funds have the right to receive payments of principal, interest and any fees to which they are entitled only from the Lender selling the loan agreement and only upon receipt by the Lender of payments from the borrower. The underlying funds generally have no right to enforce compliance with the terms of the loan agreement with the borrower. Assignments and participations involve credit, interest rate, and liquidity risk. Interest rates on floating rate securities adjust with general interest rate changes and/or issuer credit quality. The interest rates paid on a floating rate
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Notes to Financial Statements (unaudited) (continued)
security in which the underlying funds invest generally are readjusted periodically to an increment over a designated benchmark rate, such as the one-month, three-month, six-month, or one-year London Interbank Offered Rate (“LIBOR”). LIBOR is a short-term interest rate that banks charge one another and is generally representative of the most competitive and current cash rates.
The underlying funds may have difficulty trading assignments and participations to third parties. There may be restrictions on transfer and only limited opportunities may exist to sell such securities in secondary markets. As a result, the underlying funds may be unable to sell assignments or participations at the desired time or may be able to sell only at a price less than fair market value. The underlying funds utilize an independent third party to value individual bank loans on a daily basis.
Borrowing
The underlying Janus Long/Short Fund may borrow money from banks for investment purposes to the extent permitted by the 1940 Act. This practice is known as leverage. Currently, under the 1940 Act, Janus Long/Short Fund may borrow from banks up to one-third of its total assets (including the amount borrowed) provided that it maintains continuous asset coverage of 300% with respect to such borrowings and sells (within three days) sufficient portfolio holdings to restore such coverage if it should decline to less than 300% due to market fluctuations or otherwise, even if disadvantageous from an investment standpoint. Janus Long/Short Fund may also borrow money to meet redemptions in order to avoid forced, unplanned sales of portfolio securities or for other temporary or emergency purposes. This allows Janus Long/Short Fund greater flexibility to buy and sell portfolio securities for investment or tax considerations, rather than for cash flow considerations.
The use of borrowing by Janus Long/Short Fund involves special risk considerations that may not be associated with other funds that may only borrow for temporary or emergency purposes. Because substantially all of Janus Long/Short Fund’s assets fluctuate in value, whereas the interest obligation resulting from a borrowing will be fixed by the terms of Janus Long/Short Fund’s agreement with its lender, the NAV per share of Janus Long/Short Fund will tend to increase more when its portfolio securities increase in value and decrease more when its portfolio securities decrease in value than would otherwise be the case if Janus Long/Short Fund did not borrow funds. In addition, interest costs on borrowings may fluctuate with changing market rates of interest and may partially offset or exceed the return earned on borrowed funds. Under adverse market conditions, Janus Long/Short Fund might have to sell portfolio securities to meet interest or principal payments at a time when fundamental investment considerations would not favor such sales. The interest that Janus Long/Short Fund must pay on borrowed money, together with any additional fees to maintain a line of credit or any minimum average balances required to be maintained, are additional costs that will reduce or eliminate any net investment income and may also offset any potential capital gains. Unless the appreciation and income, if any, on assets acquired with borrowed funds exceed the costs of borrowing, the use of leverage will diminish the investment performance of Janus Long/Short Fund compared with what it would have been without leverage.
Counterparties
The Funds’ or underlying funds’ transactions involving a counterparty are subject to the risk that the counterparty or a third party will not fulfill its obligation to the Funds or underlying funds (“counterparty risk”). Counterparty risk may arise because of the counterparty’s financial condition (i.e., financial difficulties, bankruptcy, or insolvency), market activities and developments, or other reasons, whether foreseen or not. A counterparty’s inability to fulfill its obligation may result in significant financial loss to a Fund or underlying fund. A Fund or underlying fund may be unable to recover its investment from the counterparty or may obtain a limited recovery, and/or recovery may be delayed. The extent of the Fund’s or underlying fund’s exposure to counterparty risk in respect to financial assets approximates its carrying value as recorded on each respective Statement of Assets and Liabilities, if applicable.
A Fund or underlying fund may be exposed to counterparty risk through participation in various programs including, but not limited to, lending its securities to third parties, cash sweep arrangements whereby a Fund’s or underlying fund’s cash balance is invested in one or more types of cash management vehicles, as well as investments in, but not limited to, repurchase agreements, debt securities, and derivatives, including various types of swaps, futures and options. A Fund or underlying fund intends to enter into financial transactions with counterparties that Janus Capital believes to be creditworthy at the time of the transaction. There is always the risk that Janus Capital’s analysis of a counterparty’s creditworthiness is incorrect or may change due to market conditions. To the extent that a Fund or underlying fund focuses its transactions with a limited number of counterparties, it will have greater exposure to the risks associated with one or more counterparties.
Exchange-Traded Funds
The underlying funds may invest in exchange-traded funds, which generally are index-based investment
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companies that hold substantially all of their assets in securities representing their specific index. As a shareholder of another investment company, the underlying funds would bear their pro rata portion of the other investment company’s expenses, including advisory fees, in addition to the expenses the underlying funds bear directly in connection with their own operations.
Exchange-Traded Notes
The underlying funds may invest directly in exchange-traded notes (“ETNs”), which are senior, unsecured, unsubordinated debt securities whose returns are linked to a particular index and provide exposure to the total returns of various market indices, including indices linked to stocks, bonds, commodities and currencies. This type of debt security differs from other types of bonds and notes. ETN returns are based upon the performance of a market index minus applicable fees; no periodic coupon payments are distributed and no principal protections exist. ETNs do not pay cash distributions. Instead, the value of dividends, interest, and investment gains are captured in the underlying funds’ total returns. The underlying funds will invest in these securities when desiring exposure to debt securities or commodities. When evaluating ETNs for investment, Janus Capital will consider the potential risks involved, expected tax efficiency, rate of return, and credit risk. When the underlying funds invest in ETNs, they will bear their proportionate share of any fees and expenses borne by the ETN. There may be restrictions on the underlying funds’ right to redeem their investment in an ETN, which is meant to be held until maturity. The underlying funds’ decision to sell their ETN holdings may be limited by the availability of a secondary market.
Floating Rate Loans
Certain underlying funds, particularly Janus Balanced Fund, Janus Flexible Bond Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may invest in floating rate loans. Floating rate loans are debt securities that have floating interest rates, which adjust periodically, and are tied to a benchmark lending rate, such as LIBOR. In other cases, the lending rate could be tied to the prime rate offered by one or more major U.S. banks or the rate paid on large certificates of deposit traded in the secondary markets. If the benchmark lending rate changes, the rate payable to lenders under the loan will change at the next scheduled adjustment date specified in the loan agreement. Floating rate loans are typically issued to companies (“borrowers”) in connection with recapitalizations, acquisitions, and refinancings. Floating rate loan investments are generally below investment grade. Senior floating rate loans are secured by specific collateral of a borrower and are senior in the borrower’s capital structure. The senior position in the borrower’s capital structure generally gives holders of senior loans a claim on certain of the borrower’s assets that is senior to subordinated debt and preferred and common stock in the case of a borrower’s default. Floating rate loan investments may involve foreign borrowers, and investments may be denominated in foreign currencies. Floating rate loans often involve borrowers whose financial condition is troubled or uncertain and companies that are highly leveraged. The underlying funds may invest in obligations of borrowers who are in bankruptcy proceedings. Floating rate loans may include fully funded term loans or revolving lines of credit.
Initial Public Offerings
The underlying funds may invest in initial public offerings (“IPOs”). IPOs and other investment techniques may have a magnified performance impact on an underlying fund with a small asset base. An underlying fund may not experience similar performance as its assets grow.
Interfund Lending
As permitted by the Securities and Exchange Commission (“SEC”), or the 1940 Act and rules promulgated thereunder, the underlying funds may be party to interfund lending agreements between the underlying funds and other Janus Capital sponsored mutual funds and certain pooled investment vehicles, which permit them to borrow or lend cash at a rate beneficial to both the borrowing and lending funds. Outstanding borrowings from all sources totaling 10% or more of the borrowing underlying fund’s total assets must be collateralized at 102% of the outstanding principal value of the loan; loans of less than 10% may be unsecured.
Mortgage- and Asset-Backed Securities
The underlying funds may purchase fixed or variable rate mortgage-backed securities issued by the Government National Mortgage Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”), the Federal Home Loan Mortgage Corporation (“Freddie Mac”), or other governmental or government-related entities. Historically, Fannie Mae and Freddie Mac securities were not backed by the full faith and credit of the U.S. Government, and may not be in the future. In September 2008, the Federal Housing Finance Agency (“FHFA”), an agency of the U.S. Government, placed Fannie Mae and Freddie Mac under conservatorship to provide stability in the financial markets, mortgage availability and taxpayer protection by preserving Fannie Mae’s and Freddie Mac’s assets, and placing them in a sound and solvent condition. Under the conservatorship, the management of Fannie Mae and Freddie Mac was replaced. The effect that the FHFA’s conservatorship will
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Notes to Financial Statements (unaudited) (continued)
have on Fannie Mae’s and Freddie Mac’s debt and equities is unclear. The underlying funds may purchase other mortgage- and asset-backed securities through single- and multi-seller conduits, collateralized debt obligations, structured investment vehicles, and other similar securities. Asset-backed securities may be backed by automobile loans, equipment leases, credit card receivables, or other collateral. In the event the underlying securities fail to perform, these investment vehicles could be forced to sell the assets and recognize losses on such assets, which could impact the underlying funds’ yield and the underlying funds’ return. In addition, mortgage-backed securities may be supported by some form of government or private guarantee and/or insurance. However, there is no assurance that the guarantors or insurers will meet their obligations.
Unlike traditional debt instruments, payments on these securities include both interest and a partial payment of principal. Prepayment risk, which results from prepayments of the principal of underlying loans, may shorten the effective maturities of these securities and may result in an underlying fund having to reinvest proceeds at a lower interest rate.
In addition to prepayment risk, investments in mortgage-backed securities, including those comprised of subprime mortgages, and investments in other asset-backed securities comprised of under-performing assets may be subject to a higher degree of credit risk, valuation risk, and liquidity risk. Additionally, although mortgages and mortgage-related securities are generally supported by some form of government or private guarantee and/or insurance, there is no assurance that private guarantors or insurers will meet their obligations.
Mortgage- and asset-backed securities are also subject to extension risk, which is the risk that rising interest rates could cause mortgages or other obligations underlying these securities to be paid more slowly than expected, increasing an underlying fund’s sensitivity to interest changes and causing its price to decline.
Mortgage Dollar Rolls
Certain underlying funds, particularly Janus Flexible Bond Fund, Janus Global Real Estate Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may enter into “mortgage dollar rolls.” In a “mortgage dollar roll” transaction, the underlying funds sell a mortgage-related security (such as a Ginnie Mae security) to a dealer and simultaneously agree to repurchase a similar security (but not the same security) in the future at a predetermined price. The underlying funds will not be entitled to receive interest and principal payments while the dealer holds the security. The difference between the sale price and the future purchase price is recorded as an adjustment to investment income of the underlying funds.
The underlying funds’ obligations under a dollar roll agreement must be covered by cash, U.S. Government securities or other liquid high-grade debt obligations equal in value to the securities subject to repurchase by the underlying funds maintained in a segregated account. To the extent that the underlying funds collateralize their obligations under a dollar roll agreement, the asset coverage requirements of the 1940 Act will not apply to such transactions. Furthermore, under certain circumstances, an underlying mortgage-backed security that is part of a dollar roll transaction may be considered illiquid.
Successful use of mortgage dollar rolls depends on the portfolio managers’ ability to predict interest rates and mortgage payments. Dollar roll transactions involve the risk that the market value of the securities the underlying funds are required to purchase may decline below the agreed upon repurchase price.
Restricted Security Transactions
Restricted securities held by the underlying funds may not be sold except in exempt transactions or in a public offering registered under the Securities Act of 1933, as amended. The risk of investing in such securities is generally greater than the risk of investing in the securities of widely held, publicly traded companies. Lack of a secondary market and resale restrictions may result in the inability of the underlying funds to sell a security at a fair price and may substantially delay the sale of the security. In addition, these securities may exhibit greater price volatility than securities for which secondary markets exist.
Securities Lending
Under procedures adopted by the Trustees, the underlying funds may seek to earn additional income through lending their securities to certain qualified broker-dealers and institutions on a short-term or long-term basis. The underlying funds may lend portfolio securities on a short-term or long-term basis, in an amount equal to up to 1/3 of their total assets as determined at the time of the loan origination. When an underlying fund lends its securities, it receives collateral (including cash collateral), at least equal to the value of securities loaned. The underlying funds may earn income by investing this collateral in one or more affiliated or non-affiliated cash management vehicles. It is also possible that, due to a decline in the value of a cash management vehicle, the underlying funds may lose money. There is also the risk that when portfolio securities are lent, the securities may not be returned on a timely basis, and the underlying funds may experience
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delays and costs in recovering the security or gaining access to the collateral provided to the underlying funds to collateralize the loan. If the underlying funds are unable to recover a security on loan, the underlying funds may use the collateral to purchase replacement securities in the market. There is a risk that the value of the collateral could decrease below the cost of the replacement security by the time the replacement investment is made, resulting in a loss to the underlying funds. Janus Capital intends to manage the cash collateral in an affiliated cash management vehicle and will receive an investment advisory fee for managing such assets.
The borrower pays fees at the underlying funds’ direction to Deutsche Bank AG (the “Lending Agent”). The Lending Agent may retain a portion of the interest earned on the cash collateral invested. The cash collateral invested by the Lending Agent is disclosed on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). The lending fees and the underlying funds’ portion of the interest income earned on cash collateral are included on the underlying funds’ Statements of Operations in their most recent annual or semiannual reports (if applicable).
The underlying funds did not have any securities on loan during the period.
Securities Traded on a To-Be-Announced Basis
Certain underlying funds, particularly Janus Flexible Bond Fund, Janus Global Real Estate Fund, Janus High-Yield Fund, Janus Long/Short Fund and Janus Short-Term Bond Fund, may trade securities on a to-be-announced (“TBA”) basis. In a TBA transaction, the underlying funds commit to purchasing or selling securities for which specific information is not yet known at the time of the trade, particularly the face amount and maturity date in Ginnie Mae, Fannie Mae and/or Freddie Mac transactions.
Securities purchased on a TBA basis are not settled until they are delivered to the underlying funds, normally 15 to 45 days later. Beginning on the date the underlying funds enter into a TBA transaction, cash, U.S. Government securities or other liquid high-grade debt obligations are segregated in an amount equal in value to the purchase price of the TBA security. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.
Short Sales
The underlying funds, except the Risk-Managed funds, may engage in “short sales against the box.” Short sales against the box involve either selling short a security that the underlying funds own or selling short a security that the underlying funds have the right to obtain, for delivery at a specified date in the future. The underlying funds may enter into short sales against the box to hedge against anticipated declines in the market price of portfolio securities. The underlying funds do not deliver from their portfolios the securities sold short and do not immediately receive the proceeds of the short sale. The underlying funds borrow the securities sold short and receive proceeds from the short sale only when they deliver the securities to the lender. If the value of the securities sold short increases prior to the scheduled delivery date, the underlying funds lose the opportunity to participate in the gain.
The underlying funds, except the Risk-Managed funds, may also engage in other short sales. The underlying funds may engage in short sales when the portfolio managers and/or investment personnel anticipate that a security’s market purchase price will be less than its borrowing price. To complete the transaction, the underlying funds must borrow the security to deliver it to the purchaser and buy that same security in the market to return it to the lender. No more than 10% of the underlying funds’ net assets may be invested in short positions (through short sales of stocks, structured products, futures, swaps, and uncovered written calls). The underlying funds may engage in short sales “against the box” and options for hedging purposes that are not subject to this 10% limit. The underlying Janus Long/Short Fund is not subject to any such limit. Although the potential for gain as a result of a short sale is limited to the price at which an underlying fund sold the security short less the cost of borrowing the security, the potential for loss is theoretically unlimited because there is no limit to the cost of replacing the borrowed security. There is no assurance that the underlying funds will be able to close out a short position at a particular time or at an acceptable price. A gain or a loss will be recognized upon termination of a short sale. Short sales held by the underlying funds are fully collateralized by restricted cash or other securities, which are denoted on the underlying funds’ Schedules of Investments in their most recent annual or semiannual reports (if applicable). The underlying funds are also required to pay the lender of the security any dividends or interest that accrues on a borrowed security during the period of the loan. Depending on the arrangements made with the broker or custodian, an underlying fund may or may not receive any payments (including interest) on collateral it has deposited with the broker. The underlying funds pay stock loan fees on assets borrowed from the security broker.
The underlying funds may also enter into short positions through derivative instruments, such as options contracts, futures contracts, and swap agreements, which may expose the underlying funds to similar risks. To the extent that the underlying funds enter into short derivative
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Notes to Financial Statements (unaudited) (continued)
positions, the underlying funds may be exposed to risks similar to those associated with short sales, including the risk that the underlying funds’ losses are theoretically unlimited.
When-Issued Securities
The underlying funds may purchase or sell securities on a when-issued or forward commitment basis. The price of the underlying securities and date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. Losses may arise due to changes in the market value of the securities or from the inability of counterparties to meet the terms of the contract. In connection with such purchases, the underlying funds may hold liquid assets as collateral with the underlying funds’ custodian sufficient to cover the purchase price.
4. | Investment Advisory Agreements and Other Transactions with Affiliates |
Each Fund pays Janus Capital an investment advisory fee which is calculated daily and paid monthly. The following table reflects each Fund’s contractual investment advisory fee rate (expressed as an annual rate).
Contractual | ||||||||
Average | Investment | |||||||
Daily Net | Advisory | |||||||
Assets | Fee (%) | |||||||
Fund | of the Fund | (annual rate) | ||||||
Janus Growth Allocation Fund(1) | All Asset Levels | 0.05 | ||||||
Janus Moderate Allocation Fund(2) | All Asset Levels | 0.05 | ||||||
Janus Conservative Allocation Fund(3) | All Asset Levels | 0.05 | ||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
Janus Services LLC (“Janus Services”), a wholly-owned subsidiary of Janus Capital, is the Funds’ and the underlying funds’ transfer agent. In addition, Janus Services provides or arranges for the provision of certain other administrative services including, but not limited to, recordkeeping, accounting, order processing, and other shareholder services for the Funds.
Class D Shares pay an annual administrative services fee of 0.12% of net assets. These administrative services fees are paid by the Shares of a Fund for shareholder services provided by Janus Services.
Janus Services receives an administrative services fee at an annual rate of 0.25% of the average daily net assets of Class S Shares and Class T Shares of each Fund for providing or procuring administrative services to investors in Class S Shares and Class T Shares of the Funds. Janus Services expects to use all or a significant portion of this fee to compensate retirement plan service providers, broker-dealers, bank trust departments, financial advisors, and other financial intermediaries for providing these services. Services provided by these financial intermediaries may include, but are not limited to, recordkeeping, subaccounting, order processing, providing periodic statements, forwarding prospectuses, shareholder reports, and other materials to existing customers, and other administrative services. Order processing includes the submission of transactions through the National Securities Clearing Corporation (“NSCC”) or similar systems, or those processed on a manual basis with Janus. Janus Services or its affiliates may also pay fees for services provided by intermediaries to the extent the fees charged by intermediaries exceed the 0.25% of net assets charged to Class S Shares and Class T Shares of each Fund.
Certain, but not all, intermediaries may charge administrative fees to investors in Class A, Class C, and Class I Shares for administrative services provided on behalf of such investors. These administrative fees are paid by the Class A Shares, Class C Shares, and Class I Shares of the Funds to Janus Services, which uses such fees to reimburse intermediaries. Janus Services may negotiate the level, structure, and/or terms of the administrative fees with intermediaries requiring such fees on behalf of the Funds. Janus Capital and its affiliates benefit from an increase in assets that may result from such relationships.
Janus Distributors LLC (“Janus Distributors”), a wholly-owned subsidiary of Janus Capital, is the distributor of the Funds. The Funds have adopted a Distribution and Shareholder Servicing Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Funds at an annual rate, as determined from time to time by the Board of Trustees, of up to 0.25% of the Class A Shares average daily net assets, of up to 1.00% of the Class C Shares average daily net assets, and of up to 0.25% of the Class S Shares average daily net assets. Payments under the Plan are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder service expenses actually incurred by the Funds. If any of a Fund’s actual distribution and shareholder service expenses incurred during a calendar year are less than the payments made during a calendar year, the Fund will be refunded for the difference. Refunds, if any, are included in the “Distribution fees and shareholder servicing fees” in the Statements of Operations.
Janus Capital has agreed until at least November 1, 2011 to reimburse the Funds by the amount, if any, that such Fund’s normal operating expenses in any fiscal year, including the investment advisory fee, but excluding any
58 | DECEMBER 31, 2010
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expenses of an underlying fund (acquired fund fees and expenses), class-specific distribution and shareholder servicing fees applicable to Class A Shares, Class C Shares, and Class S Shares, the administrative services fees payable pursuant to the Transfer Agency Agreement applicable to Class D Shares, Class S Shares, and Class T Shares, brokerage commissions, interest, dividends, taxes and extraordinary expenses (including, but not limited to, acquired fund fees and expenses), exceed the annual rates noted below. If applicable, amounts reimbursed to the Funds by Janus Capital are disclosed as “Excess Expense Reimbursement” on the Statements of Operations.
Expense | |||||
Fund | Limit (%) | ||||
Janus Growth Allocation Fund(1) | 0.45 | ||||
Janus Moderate Allocation Fund(2) | 0.39 | ||||
Janus Conservative Allocation Fund(3) | 0.40 | ||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
Janus Capital has entered into an agreement with Wilshire Associates Inc. (“Wilshire”), a global investment technology, investment consulting, and investment management firm, to act as a consultant to Janus Capital. Wilshire provides research and advice regarding asset allocation methodologies, which Janus Capital uses when determining asset class allocations for the Funds. For its consulting services, Janus Capital pays Wilshire an annual fee, payable monthly, that is comprised of a combination of an initial program establishment fee, fixed fee, and an asset-based fee.
The Board of Trustees has adopted a deferred compensation plan (the “Deferred Plan”) for independent Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Funds. All deferred fees are credited to an account established in the name of the Trustees. The amounts credited to the account then increase or decrease, as the case may be, in accordance with the performance of one or more of the Janus funds that are selected by the Trustees. The account balance continues to fluctuate in accordance with the performance of the selected fund or funds until final payment of all amounts are credited to the account. The fluctuation of the account balance is recorded by the Funds as unrealized appreciation/(depreciation) and is shown as of December 31, 2010 on the Statements of Assets and Liabilities as an asset, “Non-interested Trustees’ deferred compensation,” and a liability, “Non-interested Trustees’ deferred compensation fees.” Additionally, the recorded unrealized appreciation/(depreciation) is included in “Unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” on the Statements of Assets and Liabilities. Deferred compensation expenses for the period ended December 31, 2010 are included in “Non-interested Trustees’ fees and expenses” on the Statements of Operations. Trustees are allowed to change their designation of mutual funds from time to time. Amounts will be deferred until distributed in accordance with the Deferred Plan. No deferred fees were distributed to any Trustee under the Deferred Plan during the period ended December 31, 2010.
Certain officers of the Funds may also be officers and/or directors of Janus Capital. Such officers receive no compensation from the Funds, except for the Funds’ Chief Compliance Officer. The Funds reimburse Janus Capital for a portion of the compensation paid to the Chief Compliance Officer and certain compliance staff of the Trust. Total compensation of $266,383 was paid by the Trust during the period ended December 31, 2010. Each Fund’s portion is reported as part of “Other Expenses” on the Statements of Operations.
Class A Shares include a 5.75% upfront sales charge of the offering price of the Funds. The sales charge is allocated between Janus Distributors and financial intermediaries. During the period ended December 31, 2010, Janus Distributors retained the following upfront sales charges:
Upfront | |||||
Fund (Class A Shares) | Sales Charge | ||||
Janus Growth Allocation Fund(1) | $ | 2,662 | |||
Janus Moderate Allocation Fund(2) | 5,413 | ||||
Janus Conservative Allocation Fund(3) | 5,349 | ||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
A contingent deferred sales charge of 1.00% will be deducted with respect to Class A Shares purchased without a sales load and redeemed within 12 months of purchase, unless waived, as discussed in the Prospectus. Any applicable CDSC will be 1.00% of the lesser of the original purchase price or the value of the redemption of the Class A Shares redeemed. There were no contingent deferred sales charges paid by redeeming shareholders of Class A Shares during the period ended December 31, 2010.
Class C Shares include a 1.00% contingent deferred sales charge paid by redeeming shareholders to Janus Distributors. The contingent deferred sales charge applies to shares redeemed within 12 months of purchase. The redemption price may differ from the net asset value per share. During the period ended December 31, 2010,
Janus Asset Allocation Funds | 59
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Notes to Financial Statements (unaudited) (continued)
redeeming shareholders of Class C Shares paid the following contingent deferred sales charges:
Contingent Deferred | |||||
Fund (Class C Shares) | Sales Charge | ||||
Janus Moderate Allocation Fund(1) | $ | 768 | |||
(1) | Formerly named Janus Smart Portfolio-Moderate |
The Funds’ expenses may be reduced by expense offsets from an unaffiliated custodian and/or transfer agent. Such credits or offsets are included in “Expense and Fee Offset” on the Statements of Operations (if applicable). The transfer agent fee offsets received during the period reduce “Transfer agent fees and expenses” on the Statements of Operations (if applicable). Custodian offsets received reduce “Custodian fees” on the Statements of Operations (if applicable). The Funds could have employed the assets used by the custodian and/or transfer agent to produce income if they had not entered into an expense offset arrangement.
Pursuant to the terms and conditions of an SEC exemptive order and the provisions of the 1940 Act, the Funds and the underlying funds may participate in an affiliated or non-affiliated cash sweep program. In the cash sweep program, uninvested cash balances of the Funds and underlying funds may be used to purchase shares of affiliated or non-affiliated money market funds or cash management pooled investment vehicles. The Funds and underlying funds are eligible to participate in the cash sweep program (the “Investing Funds”). Janus Cash Liquidity Fund LLC is an affiliated unregistered cash management pooled investment vehicle that invests primarily in highly-rated short-term fixed-income securities. Janus Cash Liquidity Fund LLC currently maintains a NAV of $1.00 per share and distributes income daily in a manner consistent with a registered 2a-7 product. There are no restrictions on the Funds’ ability to withdraw investments from Janus Cash Liquidity Fund LLC at will, and there are no unfunded capital commitments due from the Funds to Janus Cash Liquidity Fund LLC. As adviser, Janus Capital has an inherent conflict of interest because of its fiduciary duties to the affiliated cash management pooled investment vehicles and the Investing Funds.
During the period ended December 31, 2010, the Funds recorded distributions from affiliated investment companies as affiliated dividend income, and had the following affiliated purchases and sales:
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Janus Growth Allocation Fund(1) | |||||||||||||||||||||
INTECH Risk-Managed Growth Fund – Class I Shares | 274,613 | $ | 3,502,909 | (56,783) | $ | (739,710) | $ | (88,000) | $ | 176,832 | $ | 17,691,447 | |||||||||
INTECH Risk-Managed Value Fund – Class I Shares | 288,977 | 2,696,729 | (125,108) | (1,241,208) | (161,436) | 325,505 | 26,208,509 | ||||||||||||||
Janus Contrarian Fund – Class I Shares | 14,925 | 211,844 | (23,656) | (323,505) | (855) | 26,591 | 6,705,039 | ||||||||||||||
Janus Flexible Bond Fund – Class I Shares | 278,342 | 2,959,291 | (279,530) | (2,959,226) | 20,261 | 1,845,885 | 35,836,150 | ||||||||||||||
Janus Fund – Class I Shares | 7,906 | 220,853 | (12,208) | (318,605) | 4,044 | 35,601 | 6,935,099 | ||||||||||||||
Janus Global Bond Fund – Class I Shares | 483,057 | 4,830,572 | (641) | (6,410) | – | – | 4,824,161 | ||||||||||||||
Janus Global Real Estate Fund – Class I Shares | 98,289 | 912,258 | (36,483) | (295,108) | 27,541 | 127,005 | 6,522,907 | ||||||||||||||
Janus Global Select Fund – Class I Shares | 9,036 | 103,599 | (160,083) | (1,445,698) | 432,802 | 43,706 | 1,808,867 | ||||||||||||||
Janus Growth and Income Fund – Class I Shares | 10,534 | 308,093 | (248,484) | (8,977,566) | (1,432,140) | 68,518 | 4,406,554 | ||||||||||||||
Janus High-Yield Fund – Class I Shares | 27,858 | 247,536 | (155,566) | (1,490,343) | (82,793) | 188,714 | 3,766,322 | ||||||||||||||
Janus International Equity Fund – Class I Shares | 131,112 | 1,453,301 | (354,992) | (4,223,223) | (341,599) | 345,499 | 39,402,559 | ||||||||||||||
Janus Overseas Fund – Class I Shares | 51,780 | 2,581,885 | (21,020) | (931,728) | 40,495 | 57,412 | 23,831,044 | ||||||||||||||
Janus Research Fund – Class I Shares | 14,138 | 392,913 | (46,371) | (1,214,810) | 72,940 | 84,158 | 12,404,749 | ||||||||||||||
Janus Triton Fund – Class I Shares | 71,447 | 1,169,059 | (15,093) | (210,372) | 4,728 | 45,557 | 3,491,654 | ||||||||||||||
Janus Twenty Fund – Class D Shares | 5,553 | 349,679 | (11,295) | (695,533) | (7,784) | 40,925 | 11,723,828 | ||||||||||||||
Perkins Large Cap Value Fund – Class I Shares | 153,100 | 2,036,436 | (68,769) | (888,937) | (28,538) | 542,429 | 17,579,599 | ||||||||||||||
Perkins Mid Cap Value Fund – Class I Shares | 7,643 | 164,846 | (10,528) | (212,098) | 3,001 | 41,344 | 4,684,225 | ||||||||||||||
Perkins Small Cap Value Fund – Class I Shares | 10,905 | 256,417 | (9,693) | (208,807) | 6,293 | 132,915 | 4,545,719 | ||||||||||||||
$ | 24,398,220 | $ | (26,382,887) | $ | (1,531,040) | $ | 4,128,596 | $ | 232,368,432 | ||||||||||||
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Janus Moderate Allocation Fund(2) | |||||||||||||||||||||
INTECH Risk-Managed Growth Fund – Class I Shares | 302,171 | $ | 3,789,669 | (19,152) | $ | (226,524) | $ | (7,922) | $ | 151,403 | $ | 14,925,906 | |||||||||
INTECH Risk-Managed Value Fund – Class I Shares | 500,975 | 4,602,709 | (44,451) | (412,749) | (31,936) | 315,195 | 25,580,047 | ||||||||||||||
Janus Flexible Bond Fund – Class I Shares | 1,559,473 | 16,634,275 | (128,059) | (1,363,691) | 15,111 | 3,829,212 | 82,042,434 | ||||||||||||||
Janus Fund – Class I Shares | 31,066 | 863,149 | (4,655) | (130,363) | (8,704) | 38,712 | 7,559,521 | ||||||||||||||
Janus Global Real Estate Fund – Class I Shares | 70,309 | 647,101 | (9,262) | (81,741) | (635) | 97,476 | 4,562,084 | ||||||||||||||
Janus Global Select Fund – Class I Shares | 28,578 | 323,696 | (193,713) | (1,696,613) | 586,022 | 55,986 | 2,344,440 | ||||||||||||||
Janus Growth and Income Fund – Class I Shares | 38,982 | 1,137,491 | (209,605) | (7,242,807) | (862,268) | 66,648 | 5,383,807 | ||||||||||||||
Janus High-Yield Fund – Class I Shares | 47,578 | 424,636 | (98,341) | (895,584) | (5,031) | 151,442 | 3,397,832 | ||||||||||||||
Janus International Equity Fund – Class I Shares | 352,440 | 3,918,350 | (39,578) | (434,331) | (20,883) | 213,125 | 26,531,455 | ||||||||||||||
Janus Overseas Fund – Class I Shares | 46,451 | 2,255,578 | (23,029) | (1,075,552) | 48,872 | 57,079 | 20,964,379 |
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Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Janus Research Fund – Class I Shares | 53,065 | 1,455,673 | (13,056) | (366,531) | (13,766) | 81,612 | 12,639,502 | ||||||||||||||
Janus Short-Term Bond Fund – Class I Shares | 539,039 | 1,670,492 | (52,318) | (161,379) | 833 | 170,911 | 9,491,971 | ||||||||||||||
Janus Triton Fund – Class I Shares | 76,730 | 1,217,039 | (5,736) | (82,640) | (1,534) | 67,414 | 4,298,223 | ||||||||||||||
Janus Twenty Fund – Class D Shares | 9,029 | 567,294 | (1,382) | (89,957) | (8,851) | 17,670 | 5,138,895 | ||||||||||||||
Perkins Large Cap Value Fund – Class I Shares | 249,564 | 3,285,144 | (22,964) | (306,290) | (22,419) | 511,457 | 16,558,780 | ||||||||||||||
Perkins Small Cap Value Fund – Class I Shares | 44,984 | 1,045,315 | (5,543) | (129,897) | (8,238) | 220,878 | 7,585,742 | ||||||||||||||
$ | 43,837,611 | $ | (14,696,649) | $ | (341,349) | $ | 6,046,220 | $ | 249,005,018 | ||||||||||||
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Janus Conservative Allocation Fund(3) | |||||||||||||||||||||
INTECH Risk-Managed Growth Fund – Class I Shares | 118,157 | $ | 1,406,824 | (13,909) | $ | (190,638) | $ | (18,258) | $ | 118,049 | $ | 10,163,695 | |||||||||
INTECH Risk-Managed Value Fund – Class I Shares | 313,929 | 2,847,944 | (26,413) | (287,668) | (44,991) | 180,458 | 14,871,139 | ||||||||||||||
Janus Contrarian Fund – Class I Shares | 161 | 2,333 | (17,300) | (207,261) | 42,739 | 2,333 | 333,798 | ||||||||||||||
Janus Flexible Bond Fund – Class I Shares | 1,661,811 | 17,722,884 | (164,245) | (1,781,458) | (12,053) | 4,343,978 | 91,482,682 | ||||||||||||||
Janus Fund – Class I Shares | 24,886 | 688,476 | (2,399) | (68,359) | (305) | 15,100 | 3,232,697 | ||||||||||||||
Janus Global Real Estate Fund – Class I Shares | 24,861 | 222,893 | (3,633) | (32,991) | 1,036 | 36,205 | 1,679,707 | ||||||||||||||
Janus Global Select Fund – Class I Shares | 20,571 | 223,163 | (142,472) | (1,175,289) | 506,494 | 41,808 | 1,767,826 | ||||||||||||||
Janus Growth and Income Fund- Class I Shares | 20,714 | 583,722 | (160,478) | (4,378,222) | 517,126 | 39,657 | 1,911,325 | ||||||||||||||
Janus High-Yield Fund – Class I Shares | 63,398 | 559,747 | (90,239) | (756,138) | 61,916 | 189,261 | 4,443,248 | ||||||||||||||
Janus International Equity Fund – Class I Shares | 113,309 | 1,213,920 | (35,838) | (423,088) | (18,926) | 93,790 | 10,997,470 | ||||||||||||||
Janus Overseas Fund – Class I Shares | 18,294 | 890,247 | (1,416) | (65,848) | 4,450 | 11,536 | 4,887,259 | ||||||||||||||
Janus Research Fund – Class I Shares | 30,399 | 791,778 | (4,831) | (138,707) | (2,599) | 45,025 | 7,020,083 | ||||||||||||||
Janus Short-Term Bond Fund – Class I Shares | 536,097 | 1,660,965 | (65,730) | (205,110) | (948) | 190,975 | 10,234,998 | ||||||||||||||
Janus Triton Fund – Class I Shares | 53,355 | 822,679 | (4,347) | (67,382) | 672 | 49,303 | 3,086,038 | ||||||||||||||
Perkins Large Cap Value Fund – Class I Shares | 146,797 | 1,890,957 | (15,396) | (199,756) | 4,406 | 320,828 | 10,217,560 | ||||||||||||||
Perkins Small Cap Value Fund – Class I Shares | 22,206 | 519,939 | (1,444) | (34,252) | (225) | 33,251 | 1,430,911 | ||||||||||||||
$ | 32,048,471 | $ | (10,012,167) | $ | 1,040,534 | $ | 5,711,557 | $ | 177,760,436 | ||||||||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
Janus Capital or an affiliate invested and/or redeemed initial seed capital during the period ended December 31, 2010, as indicated in the following table.
Seed | Seed | |||||||||||||||||||
Capital at | Date of | Date of | Capital at | |||||||||||||||||
Fund | 6/30/10 | Purchases | Purchases | Redemptions | Redemption | 12/31/10 | ||||||||||||||
Janus Growth Allocation Fund(1) - Class A Shares | $ | 1,000 | �� | $ | – | – | $ | – | – | $ | 1,000 | |||||||||
Janus Growth Allocation Fund(1) - Class C Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Growth Allocation Fund(1) - Class I Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
Janus Growth Allocation Fund(1) - Class S Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
Janus Moderate Allocation Fund(2) - Class A Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Moderate Allocation Fund(2) - Class C Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Moderate Allocation Fund(2) - Class I Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Moderate Allocation Fund(2) - Class S Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
Janus Conservative Allocation Fund(3) - Class A Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Conservative Allocation Fund(3) - Class C Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Conservative Allocation Fund(3) - Class I Shares | 6,000 | – | – | – | – | 6,000 | ||||||||||||||
Janus Conservative Allocation Fund(3) - Class S Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
Janus Asset Allocation Funds | 61
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Notes to Financial Statements (unaudited) (continued)
5. | Federal Income Tax |
Income and capital gains distributions are determined in accordance with income tax regulations that may differ from accounting principles generally accepted in the United States of America. These differences are due to differing treatments for items such as net short-term gains, deferral of wash sale losses, foreign currency transactions, net investment losses and capital loss carryovers.
The Funds have elected to treat gains and losses on forward foreign currency contracts as capital gains and losses, if applicable. Other foreign currency gains and losses on debt instruments are treated as ordinary income for federal income tax purposes pursuant to Section 988 of the Internal Revenue Code.
The aggregate cost of investments and the composition of unrealized appreciation and depreciation of investment securities for federal income tax purposes as of December 31, 2010 are noted below.
Unrealized appreciation and unrealized depreciation in the table below exclude appreciation/(depreciation) on foreign currency translations. The primary difference between book and tax appreciation or depreciation of investments is wash sale loss deferrals.
Net Tax | ||||||||||||||
Federal Tax | Unrealized | Unrealized | Appreciation/ | |||||||||||
Fund | Cost | Appreciation | (Depreciation) | (Depreciation) | ||||||||||
Janus Growth Allocation Fund(1) | $ | 205,728,403 | $ | 28,707,722 | $ | (2,067,693) | $ | 26,640,029 | ||||||
Janus Moderate Allocation Fund(2) | 224,598,464 | 24,591,001 | (184,447) | 24,406,554 | ||||||||||
Janus Conservative Allocation Fund(3) | 164,861,758 | 13,000,109 | (101,431) | 12,898,678 | ||||||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
Net capital loss carryovers as of June 30, 2010 are indicated in the table below. These losses may be available to offset future realized capital gains and thereby reduce future taxable gains distributions. The following table shows the expiration dates of the carryovers.
Capital Loss Carryover Expiration Schedule
For the eight-month fiscal period ended June 30, 2010
Accumulated | ||||||||||||||
Fund | June 30, 2016 | June 30, 2017 | June 30, 2018 | Capital Losses | ||||||||||
Janus Growth Allocation Fund(1) | $ | (3,343,688) | $ | (5,645,021) | $ | (5,995,828) | $ | (14,984,537) | ||||||
Janus Moderate Allocation Fund(2) | (2,048,121) | (1,066,411) | (4,161,852) | (7,276,384) | ||||||||||
Janus Conservative Allocation Fund(3) | (2,173,333) | (601,361) | (1,523,070) | (4,297,764) | ||||||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
62 | DECEMBER 31, 2010
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6. | Expense Ratios |
The expense ratios listed in the Financial Highlights reflect expenses prior to any expense offsets (gross expense ratio) and after expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursement). Listed below are the gross expense ratios for the Funds that would have been in effect, absent the waiver of certain fees and offsets.
For the six-month period ended December 31, 2010 (unaudited),
the eight-month fiscal period ended June 30, 2010,
and each fiscal year or period ended October 31
the eight-month fiscal period ended June 30, 2010,
and each fiscal year or period ended October 31
Janus Growth | Janus Moderate | Janus Conservative | ||||||||||
Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | ||||||||||
Class A Shares | ||||||||||||
2010 | 0.56% | 0.60% | 0.56% | |||||||||
2010(4) | 0.39% | 0.40% | 0.39% | |||||||||
2009(5) | 0.50% | 0.48% | 0.45% | |||||||||
Class C Shares | ||||||||||||
2010 | 1.27% | 1.23% | 1.30% | |||||||||
2010(4) | 1.14% | 1.16% | 1.14% | |||||||||
2009(5) | 1.37% | 1.26% | 1.20% | |||||||||
Class D Shares | ||||||||||||
2010 | 0.29% | 0.27% | 0.31% | |||||||||
2010(6) | 0.27% | 0.27% | 0.24% | |||||||||
Class I Shares | ||||||||||||
2010 | 0.24% | 0.21% | 0.29% | |||||||||
2010(4) | 0.14% | 0.16% | 0.15% | |||||||||
2009(5) | 0.49% | 0.19% | 0.20% | |||||||||
Class S Shares | ||||||||||||
2010 | 0.74% | 0.68% | 0.73% | |||||||||
2010(4) | 0.65% | 0.66% | 0.64% | |||||||||
2009(5) | 0.91% | 0.92% | 0.67% | |||||||||
Class T Shares | ||||||||||||
2010 | 0.33% | 0.34% | 0.45% | |||||||||
2010(4) | 0.33% | 0.30% | 0.31% | |||||||||
2009 | 0.37% | 0.33% | 0.33% | |||||||||
2008 | 0.26% | 0.24% | 0.25% | |||||||||
2007 | 0.28% | 0.27% | 0.36% | |||||||||
2006(7) | 0.39% | 0.42% | 0.69% | |||||||||
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(6) | Period from February 16, 2010 (inception date) through June 30, 2010. | |
(7) | Period from December 30, 2005 (inception date) through October 31, 2006. |
7. | Capital Share Transactions |
For the six-month period ended December | ||||||||||||||||||||||||||||||||||||||
31, 2010 (unaudited), the eight-month fiscal period | ||||||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal year | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended October 31, 2009 | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
(all numbers are in thousands) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class A Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 113 | 52 | 14 | 222 | 83 | 108 | 156 | 84 | 21 | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | 3 | – | – | 8 | 3 | – | 7 | 1 | – | |||||||||||||||||||||||||||||
Shares repurchased | (16) | (6) | – | (24) | (24) | (2) | (29) | (2) | – | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 100 | 46 | 14 | 206 | 62 | 106 | 134 | 83 | 21 | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 60 | 14 | – | 168 | 106 | – | 104 | 21 | – | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 160 | 60 | 14 | 374 | 168 | 106 | 238 | 104 | 21 |
Janus Asset Allocation Funds | 63
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Notes to Financial Statements (unaudited) (continued)
For the six-month period ended December | ||||||||||||||||||||||||||||||||||||||
31, 2010 (unaudited), the eight-month fiscal period | ||||||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal year | Janus Growth | Janus Moderate | Janus Conservative | |||||||||||||||||||||||||||||||||||
ended October 31, 2009 | Allocation Fund(1) | Allocation Fund(2) | Allocation Fund(3) | |||||||||||||||||||||||||||||||||||
(all numbers are in thousands) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | 2010 | 2010(4) | 2009(5) | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class C Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 30 | 67 | 11 | 214 | 202 | 38 | 199 | 139 | 23 | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | 1 | – | – | 8 | 1 | – | 7 | 1 | – | |||||||||||||||||||||||||||||
Shares repurchased | – | (10) | – | (31) | (10) | – | (16) | (15) | – | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 31 | 57 | 11 | 191 | 193 | 38 | 190 | 125 | 23 | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 68 | 11 | – | 231 | 38 | – | 148 | 23 | – | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 99 | 68 | 11 | 422 | 231 | 38 | 338 | 148 | 23 | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class D Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 1,362 | 1,743(6) | N/A | 2,539 | 2,235(6) | N/A | 2,409 | 1,950(6) | N/A | |||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 9) | N/A | 17,576(6) | N/A | N/A | 15,531(6) | N/A | N/A | 10,943(6) | N/A | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | 290 | – (6) | N/A | 428 | – (6) | N/A | 452 | – (6) | N/A | |||||||||||||||||||||||||||||
Shares repurchased | (1,835) | (1,479)(6) | N/A | (1,530) | (1,320)(6) | N/A | (1,534) | (1,081)(6) | N/A | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (183) | 17840(6) | N/A | 1,437 | 16446(6) | N/A | 1,327 | 11812(6) | N/A | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 17,840 | – | N/A | 16,446 | – | N/A | 11,812 | – | N/A | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 17,657 | 17,840 | N/A | 17,883 | 16,446 | N/A | 13,139 | 11,812 | N/A | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class I Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 16 | 187 | 1 | 134 | 167 | 3 | 57 | 48 | 1 | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | 3 | – | – | 5 | – | – | 4 | – | – | |||||||||||||||||||||||||||||
Shares repurchased | (29) | (3) | – | (75) | (22) | – | (6) | (1) | – | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (10) | 184 | 1 | 64 | 145 | 3 | 55 | 47 | 1 | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 185 | 1 | – | 148 | 3 | – | 48 | 1 | – | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 175 | 185 | 1 | 212 | 148 | 3 | 103 | 48 | 1 | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class S Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 53 | 2 | 1 | 34 | 4 | 1 | 20 | 3 | 15 | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | 1 | – | – | 1 | – | – | 1 | – | – | |||||||||||||||||||||||||||||
Shares repurchased | (2) | – | – | – | – | – | (2) | (7) | – | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 52 | 2 | 1 | 35 | 4 | 1 | 19 | (4) | 15 | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 3 | 1 | – | 5 | 1 | – | 11 | 15 | – | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 55 | 3 | 1 | 40 | 5 | 1 | 30 | 11 | 15 | |||||||||||||||||||||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||||||||||||||||||||||||||
Shares sold | 117 | 1,451 | 5,156 | 713 | 2,294 | 5,504 | 282 | 2,094 | 4,547 | |||||||||||||||||||||||||||||
Shares reorganized in connection with restructuring (Note 9) | N/A | (17,576) | N/A | N/A | (15,531) | N/A | N/A | (10,943) | N/A | |||||||||||||||||||||||||||||
Reinvested dividends and distributions | (203) | 309 | 428 | 34 | 351 | 399 | 29 | 333 | 308 | |||||||||||||||||||||||||||||
Shares repurchased | 13 | (1,594) | (3,807) | (231) | (1,071) | (3,242) | (202) | (928) | (3,265) | |||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (73) | (17,410) | 1,777 | 516 | (13,957) | 2,661 | 109 | (9,444) | 1,590 | |||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 998 | 18,408 | 16,631 | 938 | 14,895 | 12,234 | 888 | 10,332 | 8,742 | |||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 925 | 998 | 18,408 | 1,454 | 938 | 14,895 | 997 | 888 | 10,332 |
(1) | Formerly named Janus Smart Portfolio - Growth. | |
(2) | Formerly named Janus Smart Portfolio - Moderate. | |
(3) | Formerly named Janus Smart Portfolio - Conservative. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009 for Class A Shares, Class C Shares, Class I Shares and Class S Shares and November 1, 2008 through October 31, 2009 for Class T Shares. | |
(6) | Transactions in Fund Shares for Class D Shares are for the period from February 16, 2010 (inception date) to June 30, 2010. |
64 | DECEMBER 31, 2010
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8. | Purchases and Sales of Investment Securities |
For the period ended December 31, 2010, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities and short-term options contracts) was as follows:
Proceeds from | ||||||||||||||
Purchases of | Sales of | |||||||||||||
Long-Term | Long-Term | |||||||||||||
Purchases of | Proceeds from Sales | U.S. Government | U.S. Government | |||||||||||
Fund | Securities | of Securities | Obligations | Obligations | ||||||||||
Janus Growth Allocation Fund(1) | $ | 24,398,219 | $ | 24,851,846 | $ | – | $ | – | ||||||
Janus Moderate Allocation Fund(2) | 43,837,611 | 14,355,300 | – | – | ||||||||||
Janus Conservative Allocation Fund(3) | 32,048,468 | 11,052,702 | – | – | ||||||||||
(1) | Formerly named Janus Smart Portfolio-Growth. | |
(2) | Formerly named Janus Smart Portfolio-Moderate. | |
(3) | Formerly named Janus Smart Portfolio-Conservative. |
9. | Shares Issued in Connection with Restructuring |
Effective February 16, 2010, Class J Shares were renamed Class T Shares and are available through certain financial intermediary platforms. In addition, Class J Shares held directly with Janus were moved to newly created Class D Shares, a share class dedicated to shareholders investing directly with Janus. Class D Shares commenced operations on February 16, 2010. The shares issued in connection with the restructuring from Class J Shares to Class D Shares are reflected on the Statements of Changes in Net Assets.
10. | Pending Legal Matters |
In the fall of 2003, the Securities and Exchange Commission (“SEC”), the Office of the New York State Attorney General (“NYAG”), the Colorado Attorney General (“COAG”), and the Colorado Division of Securities (“CDS”) announced that they were investigating alleged frequent trading practices in the mutual fund industry. On August 18, 2004, Janus Capital announced that it had reached final settlements with the SEC, the NYAG, the COAG, and the CDS related to such regulators’ investigations into Janus Capital’s frequent trading arrangements.
A number of civil lawsuits were brought in several state and federal jurisdictions against Janus Capital and certain of its affiliates, the Janus funds, and related entities and individuals based on allegations similar to those announced by the above regulators. Such lawsuits alleged a variety of theories for recovery including, but not limited to, the federal securities laws, other federal statutes (including ERISA), and various common law doctrines. The Judicial Panel on Multidistrict Litigation transferred these actions to the U.S. District Court for the District of Maryland (the “Court”) for coordinated proceedings. On September 29, 2004, five consolidated amended complaints were filed with the Court, two of which still remain: (i) claims by a putative class of shareholders of Janus Capital Group Inc. (“JCGI”) asserting claims on behalf of the shareholders against JCGI and Janus Capital (First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S. District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins, et al. v. Janus Capital Group, Inc., et al., U.S. District Court, District of Maryland, Case No. 04-CV-00818); and (ii) derivative claims by investors in certain Janus funds ostensibly on behalf of such funds (Steinberg et al. v. Janus Capital Management, LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518).
In the First Derivative Traders case (action (i) above), a Motion to Dismiss was previously granted and the matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the United States Court of Appeals for the Fourth Circuit (“Fourth Circuit”). In May 2009, the Fourth Circuit reversed the order of dismissal and remanded the case back to the trial court for further proceedings. In June 2010, the United States Supreme Court agreed to review the Fourth Circuit’s decision. As a result of these developments at the Supreme Court, the trial court has stayed all further proceedings until the Supreme Court rules on the matter. In the Steinberg case (action (ii) above), the trial court entered an order on January 20, 2010, granting Janus Capital’s Motion for Summary Judgment and dismissing the remaining claims asserted against the company. However, in February 2010, Plaintiffs appealed the trial court’s decision with the Fourth Circuit.
Additional lawsuits may be filed against certain of the Janus funds, Janus Capital, and related parties in the future. Janus Capital does not currently believe that these pending actions will materially affect its ability to continue providing services it has agreed to provide to the Janus funds.
Janus Asset Allocation Funds | 65
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Notes to Financial Statements (unaudited) (continued)
11. | New Accounting Pronouncements |
In January 2010, the FASB issued Accounting Standards Update, “Improving Disclosures About Fair Value Measurements.” The Accounting Standards Update requires disclosures about purchases, sales, issuances, and settlements on a gross basis relating to Level 3 measurements. This disclosure will become effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact the adoption of this Accounting Standards Update will have on the Funds’ financial statement disclosures.
12. | Subsequent Events |
Management has evaluated whether any events or transactions occurred subsequent to December 31, 2010 and through the date of issuance of the Funds’ financial statements and determined that there were no material events or transactions that would require recognition or disclosure in the Funds’ financial statements.
66 | DECEMBER 31, 2010
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Additional Information (unaudited)
Proxy Voting Policies and Voting Record
A description of the policies and procedures that the Portfolios use to determine how to vote proxies relating to their portfolio securities is available without charge: (i) upon request, by calling 1-800-525-0020 (toll free); (ii) on the Portfolios’ website at janus.com/proxyvoting; and (iii) on the SEC’s website at http://www.sec.gov. Additionally, information regarding each Portfolio’s proxy voting record for the most recent twelve-month period ended June 30 is also available, free of charge, through janus.com/proxyvoting and from the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Holdings
The Portfolios file their complete portfolio holdings (schedule of investments) with the SEC for the first and third quarters of each fiscal year on Form N-Q within 60 days of the end of such fiscal quarter. The Portfolios’ Form N-Q: (i) is available on the SEC’s website at http://www.sec.gov; (ii) may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the Public Reference Room may be obtained by calling 1-800-SEC-0330); and (iii) is available without charge, upon request, by calling Janus at 1-800-525-0020 (toll free).
Approval of Advisory Agreements During The Period
The Trustees of Janus Investment Fund, none of whom has ever been affiliated with Janus Capital (“Independent Trustees”), oversee the management of each Fund and, as required by law, determine annually whether to continue the investment advisory agreement for each Fund and the subadvisory agreements for the nine Funds that utilize subadvisers.
In connection with their most recent consideration of those agreements for each Fund, the Trustees received and reviewed a substantial amount of information provided by Janus Capital and the respective subadvisers in response to requests of the Independent Trustees and their independent legal counsel. They also received and reviewed a considerable amount of information and analysis provided by their independent fee consultant. Throughout their consideration of the agreements, the Independent Trustees were advised by their independent legal counsel. The Independent Trustees met with management to consider the agreements, and also met separately in executive session with their independent legal counsel and their independent fee consultant.
At a meeting held on December 3, 2010, based on the Trustees’ evaluation of the information provided by Janus Capital, the subadvisers and the independent fee consultant, as well as other information, the Trustees determined that the overall arrangements between each Fund and Janus Capital and each subadviser, as applicable, were fair and reasonable in light of the nature, extent and quality of the services provided by Janus Capital, its affiliates and the subadvisers, the fees charged for those services, and other matters that the Trustees considered relevant in the exercise of their business judgment. At that meeting, the Trustees unanimously approved the continuation of the investment advisory agreement for each Fund, and the subadvisory agreement for each subadvised Fund, for the period from February 1, 2011 through February 1, 2012, subject to earlier termination as provided for in each agreement.
In considering the continuation of those agreements, the Trustees reviewed and analyzed various factors that they determined were relevant, including the factors described below, none of which by itself was considered dispositive. However, the material factors and conclusions that formed the basis for the Trustees’ determination to approve the continuation of the agreements are discussed separately below.
Nature, Extent and Quality of Services
The Trustees reviewed the nature, extent and quality of the services provided by Janus Capital and the subadvisers to the Funds, taking into account the investment objective and strategy of each Fund and the knowledge the Trustees gained from their regular meetings with management on at least a quarterly basis and their ongoing review of information related to the Funds. In addition, the Trustees reviewed the resources and key personnel of Janus Capital and each subadviser, particularly noting those employees who provide investment management services to the Funds. The Trustees also considered other services provided to the Funds by Janus Capital or the subadvisers, such as managing the execution of portfolio transactions and the selection of broker-dealers for those transactions, serving as the Funds’ administrator, monitoring adherence to the Funds’ investment restrictions, producing shareholder reports, providing support services for the Trustees and Trustee committees, communicating with shareholders and overseeing the activities of other service providers, including monitoring compliance with various policies and procedures of the Funds and with applicable securities laws and regulations.
The Trustees concluded that the nature, extent and quality of the services provided by Janus Capital or the subadviser to each Fund were appropriate and consistent with the terms of the respective advisory and subadvisory agreements, and that, taking into account steps taken to address those Funds whose performance lagged that of
Janus Asset Allocation Funds | 67
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Additional Information (unaudited) (continued)
their peers for certain periods, the quality of those services had been consistent with or superior to quality norms in the industry and the Funds were likely to benefit from the continued provision of those services. They also concluded that Janus Capital and each subadviser had sufficient personnel, with the appropriate education and experience, to serve the Funds effectively and had demonstrated its continuing ability to attract well-qualified personnel.
Performance of the Funds
The Trustees considered the performance results of each Fund over various time periods. They reviewed information comparing each Fund’s performance with the performance of comparable funds and peer groups identified by Lipper, and with the Fund’s benchmark index. They concluded that the performance of many Funds was good to very good under current market conditions. Although the performance of some Funds lagged that of their peers for certain periods, the Trustees also concluded that Janus Capital had taken or was taking appropriate steps to address those instances of under-performance.
Costs of Services Provided
The Trustees examined information regarding the fees and expenses of each Fund in comparison to similar information for other comparable funds as provided by Lipper. They also reviewed an analysis of that information provided by their independent fee consultant and noted that the rate of management (investment advisory and administrative) fees for most of the Funds, after applicable contractual expense limitations, was below the mean management fee rate of the respective peer group of funds selected by Lipper.
The Trustees considered the methodology used by Janus Capital and each subadviser in determining compensation payable to portfolio managers, the competitive environment for investment management talent and the competitive market for mutual funds in different distribution channels. They concluded that the compensation methodology provided a good alignment of the interests of the portfolio managers with the interests of Fund shareholders.
The Trustees also reviewed management fees charged by Janus Capital to its separate account clients and to non-affiliated funds subadvised by Janus Capital (for which Janus Capital provides only portfolio management services). Although in most instances subadvisory and separate account fee rates for various investment strategies were lower than management fee rates for Funds having a similar strategy, the Trustees noted that, under the terms of the management agreements with the Funds, Janus Capital performs significant additional services for the Funds that it does not provide to those other clients, including administrative services, oversight of the Funds’ other service providers, trustee support, regulatory compliance and numerous other services, and that, in serving the Funds, Janus Capital assumes many legal risks that it does not assume in servicing its other clients. Moreover, they noted that the spread between the average fee rates charged to the Funds and the fee rates that Janus Capital charged to its separate account clients was significantly smaller than the average spread for such fee rates of other advisers, based on publicly available data and research conducted by the Trustees’ independent fee consultant.
The Trustees reviewed information on the profitability to Janus Capital and its affiliates of their relationships with each Fund, as well as an explanation of the methodology utilized in allocating various expenses of Janus Capital and its affiliates among the Funds and other clients. The Trustees also reviewed the financial statements and corporate structure of Janus Capital’s parent company. In their review, the Trustees considered whether Janus Capital and each subadviser receive adequate incentives to manage the Funds effectively. The Trustees recognized that profitability comparisons among fund managers are difficult because very little comparative information is publicly available and the profitability of any fund manager is affected by numerous factors, including the organizational structure of the particular fund manager, the types of funds and other accounts it manages, possible other lines of business, the methodology for allocating expenses and the fund manager’s capital structure and cost of capital. However, taking into account those factors and the analysis provided by the Trustees’ independent fee consultant, and based on the information available, the Trustees concluded that Janus Capital’s profitability with respect to each Fund in relation to the services rendered was not unreasonable.
The Trustees concluded that the management fees and other compensation payable by each Fund to Janus Capital and its affiliates, as well as the fees paid by Janus Capital to the subadvisers of subadvised Funds, were reasonable in relation to the nature, extent and quality of the services provided, taking into account the fees charged by other advisers for managing comparable mutual funds with similar strategies and the fees Janus Capital and the subadvisers charge to other clients. The Trustees also concluded that the overall expense ratio of each Fund was reasonable, taking into account the size of the Fund, the quality of services provided by Janus Capital and any subadviser, the investment performance of the Fund and any expense limitations agreed to by Janus Capital.
Economies of Scale
68 | DECEMBER 31, 2010
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The Trustees considered information about the potential for Janus Capital to realize economies of scale as the assets of the Funds increase. They noted that, although many Funds pay advisory fees at a fixed rate as a percentage of net assets, without any breakpoints, the actual management fee rate paid by each Fund, after any contractual expense limitations, was below the mean management fee rate of the Fund’s peer group identified by Lipper; and, for those Funds whose expenses are being reduced by the contractual expense limitations of Janus Capital, Janus Capital is subsidizing the Funds because they have not reached adequate scale. Moreover, as the assets of many of the Funds have declined in the past few years, the Funds have benefited from having advisory fee rates that have remained constant rather than increasing as assets declined. In addition, performance fee structures have been implemented for several Funds that have caused or will cause the effective rate of advisory fees payable by such a Fund to vary depending on the investment performance of the Fund relative to its benchmark index over the measurement period; and a few Funds have fee schedules with breakpoints and reduced fee rates above certain asset levels. The Trustees also noted that the Funds share directly in economies of scale through the lower charges of third-party service providers that are based in part on the combined scale of all of the Funds. Based on all of the information they reviewed, including research and analysis conduct by the Trustees’ Independent Fee Consultant, the Trustees concluded that the current fee structure of each Fund was reasonable and that the current rates of fees do reflect a sharing between Janus Capital and the Fund of economies of scale at the current asset level of the Fund.
Other Benefits to Janus Capital
The Trustees also considered benefits that accrue to Janus Capital and its affiliates from their relationships with the Funds. They recognized that two affiliates of Janus Capital separately serve the Funds as transfer agent and distributor, respectively, and the transfer agent receives compensation directly from the non-money market funds for services provided. The Trustees also considered Janus Capital’s past and proposed use of commissions paid by the Funds on their portfolio brokerage transactions to obtain proprietary and third-party research products and services benefiting the Fund and/or other clients of Janus Capital. The Trustees concluded that Janus Capital’s use of these types of client commission arrangements to obtain proprietary and third-party research products and services was consistent with regulatory requirements and guidelines and was likely to benefit each Fund. The Trustees also concluded that, other than the services provided by Janus Capital and its affiliates pursuant to the agreements and the fees to be paid by each Fund therefor, the Funds and Janus Capital may potentially benefit from their relationship with each other in other ways. They concluded that Janus Capital benefits from the receipt of research products and services acquired through commissions paid on portfolio transactions of the Funds and that the Funds benefit from Janus Capital’s receipt of those products and services as well as research products and services acquired through commissions paid by other clients of Janus Capital. They further concluded that success of any Fund could attract other business to Janus Capital or other Janus funds, and that the success of Janus Capital could enhance Janus Capital’s ability to serve the Funds.
After full consideration of the above factors, as well as other factors, the Trustees, each of whom is an Independent Trustee, concluded at their December 3, 2010 meeting that the proposed continuation of the investment advisory agreement and, if applicable, the subadvisory agreement for each Fund for another year was in the best interest of the respective Funds and their shareholders.
Janus Asset Allocation Funds | 69
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Explanations of Charts, Tables and
Financial Statements (unaudited)
Financial Statements (unaudited)
1. | Performance Overviews |
Performance overview graphs compare the performance of a hypothetical $10,000 investment in each Fund (from inception) with one or more widely used market indices. The hypothetical example does not represent the returns of any particular investment.
When comparing the performance of a Fund with an index, keep in mind that market indices do not include brokerage commissions that would be incurred if you purchased the individual securities in the index. They also do not include taxes payable on dividends and interest or operating expenses incurred if you maintained a Fund invested in the index.
Average annual total returns are also quoted for each Fund. Average annual total return is calculated by taking the growth or decline in value of an investment over a period of time, including reinvestment of dividends and distributions, then calculating the annual compounded percentage rate that would have produced the same result had the rate of growth been constant throughout the period. Average annual total return does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares.
Pursuant to federal securities rules, expense ratios shown in the performance chart reflect subsidized and unsubsidized ratios for the prior fiscal year. The total annual fund operating expenses ratio is gross of any fee waivers, reflecting a Fund’s unsubsidized expense ratio. The net annual fund operating expenses ratio (if applicable) includes contractual waivers of Janus Capital and reflects a Fund’s subsidized expense ratio. Both the total annual fund operating expenses ratio and net annual fund operating expenses ratio are based on average net assets as of the fiscal period ended June 30, 2010. The ratios also include expenses indirectly incurred by a Fund as a result of investing in other investment companies or pooled investments, which are not reflected in the “Financial Highlights” of this report. As a result, these ratios may be higher or lower than those shown in the “Financial Highlights” in this report. All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
2. | Schedules of Investments |
Following the performance overview section is each Fund’s Schedule of Investments. This schedule reports the types of securities held in each Fund on the last day of the reporting period. Holdings are subject to change without notice.
The value of each security is quoted as of the last day of the reporting period.
3. | Statements of Assets and Liabilities |
These statements are often referred to as the “balance sheets.” It lists the assets and liabilities of the Funds on the last day of the reporting period.
The Funds’ assets are calculated by adding the value of the securities owned, the receivable for securities sold but not yet settled, the receivable for dividends declared but not yet received on underlying fund shares owned and the receivable for Fund shares sold to investors but not yet settled. The Funds’ liabilities include payables for securities purchased but not yet settled, Fund shares redeemed but not yet paid and expenses owed but not yet paid. Additionally, there may be other assets and liabilities.
The section entitled “Net Assets Consist of” breaks down the components of the Funds’ net assets. Because the Funds must distribute substantially all earnings, you will notice that a significant portion of net assets is shareholder capital.
The last section of this statement reports the net asset value (“NAV”) per share on the last day of the reporting period. The NAV is calculated by dividing the Funds’ net assets (assets minus liabilities) by the number of shares outstanding.
4. | Statements of Operations |
These statements detail the Funds’ income, expenses, gains and losses on securities and currency transactions, and appreciation or depreciation of current Fund holdings.
The first section in this statement, entitled “Investment Income,” reports the dividends earned from underlying fund shares and interest earned from interest-bearing securities in the Funds.
The next section reports the expenses incurred by the Funds, including the advisory fee paid to the investment adviser, transfer agent fees and expenses, and printing and postage for mailing statements, financial reports and prospectuses. Expense offsets and expense reimbursements, if any, are also shown.
The last section lists the increase or decrease in the value of securities held in the Funds. The Funds will realize a gain (or loss) when they sell their position in a particular security. An unrealized gain (or loss) refers to the change in net appreciation or depreciation of the Funds during the reporting period. “Net Realized and Unrealized Gain/(Loss) on Investments” is affected both by changes in the market value of Fund holdings and by gains (or losses) realized during the reporting period.
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5. | Statements of Changes in Net Assets |
These statements report the increase or decrease in the Funds’ net assets during the reporting period. Changes in the Funds’ net assets are attributable to investment operations, dividends, distributions and capital share transactions. This is important to investors because it shows exactly what caused the Funds’ net asset size to change during the period.
The first section summarizes the information from the Statements of Operations regarding changes in net assets due to the Funds’ investment performance. The Funds’ net assets may also change as a result of dividend and capital gains distributions to investors. If investors receive their dividends in cash, money is taken out of the Funds to pay the distribution. If investors reinvest their dividends, the Funds’ net assets will not be affected. If you compare each Fund’s “Net Decrease from Dividends and Distributions” to the “Reinvested dividends and distributions,” you will notice that dividend distributions had little effect on each Fund’s net assets. This is because the majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under “Capital Share Transactions.” “Capital Shares” refers to the money investors contribute to the Funds through purchases or withdrawals via redemptions. The Funds’ net assets will increase and decrease in value as investors purchase and redeem shares from the Funds.
6. | Financial Highlights |
This schedule provides a per-share breakdown of the components that affect each Fund’s NAV for current and past reporting periods. Not only does this table provide you with total return, it also reports total distributions, asset size, expense ratios and portfolio turnover rate.
The first line in the table reflects the NAV per share at the beginning of the reporting period. The next line reports the net investment income per share, which comprises dividends and interest income earned on securities held by the Funds. Following is the total of gains/(losses), realized and unrealized. Dividends and distributions are then subtracted to arrive at the NAV per share at the end of the period. The next line reflects the average annual total return reported the last day of the period. The total return may include adjustments in accordance with generally accepted accounting principles. As a result, the total return may differ from the total return reflected for shareholder transactions.
Also included are the expense ratios, or the percentage of average net assets that were used to cover operating expenses during the period. Expense ratios vary across the Funds within the Trust for a number of reasons, including the differences in management fees, the frequency of dividend payments and the extent of foreign investments, which entail greater transaction costs.
The Funds’ expenses may be reduced through expense-reduction arrangements. These arrangements may include the use of balance credits or transfer agent fee offsets. The Statements of Operations reflect total expenses before any such offset, the amount of the offset and the net expenses. The expense ratios listed in the Financial Highlights reflect total expenses prior to any expense offset (gross expense ratio) and after the expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursements), if applicable.
The ratio of net investment income/(loss) summarizes the income earned less expenses, divided by the average net assets of a Fund during the reporting period. Don’t confuse this ratio with a Fund’s yield. The net investment income ratio is not a true measure of a Fund’s yield because it doesn’t take into account the dividends distributed to the Fund’s investors.
The next figure is the portfolio turnover rate, which measures the buying and selling activity in a Fund. Portfolio turnover is affected by market conditions, changes in the asset size of a Fund, the nature of the Fund’s investments, changes in the target allocation and the investment style of the portfolio manager. A 100% rate implies that an amount equal to the value of the entire portfolio is turned over in a year; a 50% rate means that an amount equal to the value of half the portfolio is traded in a year; and a 200% rate means that an amount equal to the value of the portfolio is traded every six months.
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Notes
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Notes
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Janus provides access to a wide range of investment disciplines.
Alternative
Janus alternative funds seek to deliver strong risk-adjusted returns over a full market cycle with lower correlation to equity markets than traditional investments.
Asset Allocation
Janus’ asset allocation funds utilize our fundamental, bottom-up research to balance risk over the long term. From fund options that meet investors’ risk tolerance and objectives to a method that incorporates non-traditional investment choices to seek non-correlated sources of risk and return, Janus’ asset allocation funds aim to allocate risk more effectively.
Core
Janus core funds seek investments in more stable and predictable companies. These funds look for a strategic combination of steady growth and for certain funds, some degree of income.
Fixed Income
Janus fixed income funds attempt to provide less risk relative to equities while seeking to deliver a competitive total return through high current income and appreciation. Janus money market funds seek capital preservation and liquidity with current income as a secondary objective.
Global & International
Janus global and international funds seek to leverage Janus’ research capabilities by taking advantage of inefficiencies in foreign markets, where accurate information and analytical insight are often at a premium.
Growth
Janus growth funds focus on companies believed to be the leaders in their respective industries, with solid management teams, expanding market share, margins and efficiencies.
Risk Managed
Our risk-managed funds seek to outperform their respective indices while maintaining a risk profile equal to or lower than the index itself. Managed by INTECH (a Janus subsidiary), these funds use a mathematical process in an attempt to build a more “efficient” portfolio than the index.
Value
Janus value funds invest in companies they believe are poised for a turnaround or are trading at a significant discount to fair value. The goal is to gain unique insight into a company’s true value and identify and evaluate potential catalysts that may unlock shareholder value.
For more information about our funds, contact your investment professional or go to janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus).
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Please consider the charges, risks, expenses and investment objectives carefully before investing or recommending to clients for investment. For a prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus); or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus). Read it carefully before you invest or send money.
Janus Distributors LLC 151 Detroit Street, Denver, CO 80206 (02/11)
Investment products offered are: NOT FDIC-INSURED MAY LOSE VALUE NO BANK GUARANTEE
C-0111-226 | 125-24-93005 02-11 |
Table of Contents
2010 SEMIANNUAL REPORT
Janus Fixed Income & Money Market Funds
Fixed Income
Janus Flexible Bond Fund
Janus Global Bond Fund
Janus High-Yield Fund
Janus Short-Term Bond Fund
Money Market
Janus Government Money Market Fund
Janus Money Market Fund
HIGHLIGHTS
• | Portfolio management perspective |
• | Investment strategy behind your fund |
• | Fund performance, characteristics and holdings |
![(JANUS LOGO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932janus.gif)
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Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS(52687) (or 800.525.3713 if you hold Shares directly with Janus Capital). You can also visit janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
Investment in money market funds are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although money market funds seek to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in money market funds.
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Co-Chief Investment Officers’ Market Perspective (unaudited)
![(JONATHAN COLEMAN PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932pcolemaj.jpg)
Jonathan Coleman
Co-Chief Investment Officer
![(GIBSON SMITH PHOTO)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932psmithgi.jpg)
Gibson Smith
Co-Chief Investment Officer
We would like to take this opportunity to thank you for investing with Janus and to share some good news. Brent Lynn, portfolio manager of Janus Overseas Fund, was recently named Morningstar’s International Stock-Fund Manager of the Year. Please join us in congratulating Brent and the entire investment team on this prestigious honor. Brent is the first to say that this is a collective, rather than an individual honor, and we are proud that Janus’ fundamental research approach has been recognized as it continues to be the driving force behind the investment process of all our products.
Opportunities in the Recovery
As we head into 2011, the big surprise for the year could be that the recovery looks more and more normal by the day. Economic data points continue to impress, defying skeptics who predicted a slide back to recession. Recent clarity on taxes should facilitate greater investment and spending by companies, and the Federal Reserve (Fed) has indicated that it intends to continue stimulating the economy through monetary policy. While unemployment remains high, job creation will follow if companies continue to show strong profitability and see growth on the horizon, which we expect to happen. Overall, the recovery appears to be gaining momentum.
One reason we’re more bullish is that fiscal and monetary policies are working together to fuel economic growth. The extension of the Bush tax package for two years will add an estimated one percentage point to growth in 2011. Economists and politicians may debate the fiscal responsibility of the package, but along with the improved transparency on taxes, the near-term effect is likely to be an increase in spending and confidence. At the same time, the Fed has signaled that it intends to continue stimulating the economy through additional “quantitative easing” as well as reinvesting coupon and principal payments in the Fed’s current portfolio. All told, we believe these steps will help the healing process now underway.
Naturally, our optimism comes with caveats. Recent data on home prices have been disappointing and we continue to view a potential downturn in housing as the biggest risk for the U.S. economy. We are also concerned about sovereign debt issues in Europe and budgetary challenges to state and local governments in the U.S. Eventually, self-sustaining growth will be necessary to facilitate robust job creation.
Equities Remain Attractive
We think U.S. equities will outperform in 2011. Stimulus measures are working through the system and should provide further support. Ideally, we’ll see a “Goldilocks” scenario: the U.S. economy will get a short-term boost from the stimulus and increased credibility on the international stage if Washington finally tackles the deficit.
Despite the rally late in the period, equity valuations remain moderate by historical standards. Companies have emerged from the recession with pristine balance sheets and net margins of 12.3%, as of the fourth quarter of 2010, close to the highest level in more than 25 years for large firms. Another positive indicator for stocks is an increase in mergers-and-acquisitions activity – evidence that companies are starting to deploy their cash.
With the outlook improving, we think that economically sensitive sectors could outperform. Consumer discretionary, energy, technology and industrials may do well if economic indicators continue to gain strength. Increasing clarity on regulations may help health care and financial services. As rules become more clearly defined, these sectors could regain some market leadership.
Going forward, fundamentals should matter more as the market increasingly differentiates companies based on their balance sheets, growth rates and competitive advantages. We believe this will create a better environment for active managers to add value through stock selection.
Higher Yields and Opportunities in Fixed Income
Bonds had a difficult fourth quarter as yields rose sharply and some of the risk aversion bid into the Treasury market receded. Fiscal and monetary policies will be a headwind for the bond market over the next few years. At the same time, we think the rise in yields is justified as economic data have come in better than expected. In our opinion,
Janus Fixed Income & Money Market Funds | 1
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Continued
bonds remain attractive when evaluated on real returns (yield minus inflation).
The media continues to discuss “bursting bubbles,” and the more this gets overplayed the greater the opportunities for investors. Higher yields and steeper curves make fixed income more attractive in a low inflationary environment. In this context, we continue to favor corporate debt securities as we believe the health and profitability of corporations are improving. The new wave of financial conservatism in corporations is a welcome sign. We think it represents a new mindset for management that will result in more disciplined investment. More conservative capital structures should lead to higher bond prices.
In this volatile climate, similar to selection of individual equities, individual security selection holds the key to higher risk-adjusted returns. We believe that the construct of the indices does not reflect a proper risk appetite for most investors, in our view, forcing investors to hold debt securities that are not fundamentally improving, thus presenting greater downside risk. We believe an active approach with a focus on fundamental company analysis will yield higher risk-adjusted return with better downside protection long term.
Looking Ahead
Investors should be paying keen attention to the strength of the recovery in the United States, as well as pressures in the global economy. Strong Asian and emerging market growth is fueling inflation in certain regions and forcing central banks to raise rates. Developed nations, meanwhile, are continuing to aggressively pursue loose monetary and fiscal policies. In this environment, investors need to focus more than ever on balance in their portfolios, taking in to account current valuations and expected returns. The global recovery is well underway and this will present new opportunities in the markets as well as new challenges. As always, we will work hard to find the most promising investment opportunities for our shareholders.
Thanks again for your trust and confidence in Janus.
Sincerely,
![(-s- JONATHAN COLEMAN)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932scolemaj.gif)
Jonathan Coleman
Co-Chief Investment Officer
![(-s- GIBSON SMITH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932ssmithgi.gif)
Gibson Smith
Co-Chief Investment Officer
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Co-Chief Investment Officers’ Market Perspective (unaudited)
Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus Capital) or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
Past performance is no guarantee of future results. Visit janus.com/advisor (or janus.com/allfunds if you hold Shares directly with Janus Capital) for current month-end performance.
Award based on Class T Shares. Established in 1988, the Morningstar Fund Manager of the Year Award recognizes portfolio managers who demonstrate excellent investment skill and the courage to differ from the consensus to benefit investors. To qualify for the award, managers’ funds must have not only posted impressive returns for the year, but the managers also must have a record of delivering outstanding long-term performance and of aligning their interests with shareholders’. The Fund Manager of the Year Award winners are chosen based on Morningstar’s proprietary research and in-depth evaluation by its fund analysts.
The opinions are those of the authors as of December 2010 and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of individual holdings or market sectors, but as an illustration of broader themes.
Statements in this piece that reflect projections or expectations of future financial or economic performance of a mutual fund or strategy and of the markets in general and statements of a fund’s plans and objectives for future operations are forward-looking statements. Actual results or events may differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements. Important factors that could result in such differences, in addition to the other factors noted with such forward-looking statements, include general economic conditions such as inflation, recession and interest rates.
Funds distributed by Janus Distributors LLC (2/11)
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Useful Information About Your Fund Report (unaudited)
Management Commentaries
The Management Commentaries in this report include valuable insight from each of the Funds’ managers as well as statistical information to help you understand how your Fund’s performance and characteristics stack up against those of comparable indices.
If a Fund invests in foreign securities, this report may include information about country exposure. Country exposure is based primarily on the country of domicile. However, the Funds’ managers may allocate a company to a country based on other factors such as location of the company’s principal office, the location of the principal trading market for the company’s securities, or the country where a majority of the company’s revenues are derived.
Please keep in mind that the opinions expressed by the Funds’ managers in the Management Commentaries are just that: opinions. They are a reflection of the managers’ best judgment at the time this report was compiled, which was December 31, 2010. As the investing environment changes, so could the managers’ opinions. These views are unique to each manager and aren’t necessarily shared by fellow employees or by Janus in general.
Fund Expenses
We believe it’s important for our shareholders to have a clear understanding of Fund expenses and the impact they have on investment return.
The following is important information regarding each Fund’s Expense Example, which appears in each Fund’s Management Commentary within this Semiannual Report. Please refer to this information when reviewing the Expense Example for each Fund.
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (applicable to Class A Shares of the Fixed Income Funds only); redemption fees, where applicable (and any related exchange fees); and (2) ongoing costs, including management fees; distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares of certain Fixed Income Funds only); administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class R Shares, Class S Shares, and Class T Shares of certain Fixed Income Funds only); administrative, networking or omnibus fees (applicable to Class A Shares, Class C Shares, and Class I Shares of the Fixed Income Funds only); and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The example is based upon an investment of $1,000 invested at the beginning of the period and held for the six-month period from July 1, 2010 to December 31, 2010.
Actual Expenses
The first line of the table in each example provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
The second line of the table in each example provides information about hypothetical account values and hypothetical expenses based upon each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Janus Capital Management LLC (“Janus Capital”) has contractually agreed to waive each Fixed Income Fund’s total annual fund operating expenses, excluding any class-specific distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares only), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class R Shares, Class S Shares, and Class T Shares only), brokerage commissions, interest, dividends, taxes, and extraordinary expenses, including, but not limited to, acquired fund fees and expenses, to certain limits until at least November 1, 2011. Expenses in the examples reflect application of these waivers. Had the waivers not been in effect, your expenses would have been higher. More information
4 | DECEMBER 31, 2010
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regarding the waivers is available in the Funds’ prospectuses.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as redemption fees (where applicable) and any related exchange fees. These fees are fully described in the Funds’ prospectuses. Therefore, the second line of each table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
Janus Fixed Income & Money Market Funds | 5
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Janus Flexible Bond Fund (unaudited)
Fund Snapshot We seek to identify the best opportunities across fixed income markets using a bottom-up, fundamentally-driven process that is focused on credit-oriented investments. We believe our approach, which focuses on credit, can generate risk-adjusted outperformance relative to peers over time. Our comprehensive bottom-up view drives decision-making at a macro level, enabling us to make informed decisions about allocations to all sectors of the fixed income universe. | ![]() Gibson Smith co-portfolio manager | ![]() Darrell Watters co-portfolio manager |
Performance Overview
During the six-month period ended December 31, 2010, Janus Flexible Bond Fund’s Class T Shares returned 2.29%, compared to a 1.15% return for the Fund’s benchmark, the Barclays Capital U.S. Aggregate Bond Index.
Economic Update
The U.S. economy continues on the path to recovery, but the path remains cluttered with unpredictable risks and outcomes. While corporate America shows signs of increasing strength, it is being partially offset by factors such as high unemployment and Europe’s sovereign debt problems. Investors are left contemplating the best means to participate in a market that remains highly event-driven and reactive to news flow.
Fears of inflation have put many investors on yellow alert and fueled a more volatile environment for fixed income. An example of this sentiment occurred in the fourth quarter of 2010, when intermediate-to-long dated U.S. Treasuries sold off sharply. The dramatic spike in rates was not a result of economic data indicating a rise in inflation; rather, it was a result of investors concluding that the extension of the Bush tax cuts, more stimulus spending, and quantitative easing by the Federal Reserve (Fed) would drive inflation well beyond previous expectations.
We do not believe that a significant spike in inflation is imminent. We view the economic landscape through individual company and credit analysis, both of which indicate that inflationary pressures remain in check. As the recovery gains momentum, the threat of inflation could be real. We also believe the consensus scenario around an upward trend in rates is likely to play out in the medium term, maintaining pressure in the fixed income markets. But it’s important to keep in mind that there is considerable slack in the employment and goods market, and deflationary pressures are still working their way through the system, mitigating upward price momentum. We will be watching closely for early signs of inflationary pressures and will be attempting to prepare the Fund accordingly.
In light of the market’s focus on inflation expectations, investors may begin to see notable divergences in the risk/reward profiles of fixed income. We believe one of the greatest and most under-appreciated risks relates to duration extension of the indices and thus an increase in overall interest rate risk. (Duration measures a bond’s sensitivity to changes in interest rates). The Barclays Capital U.S. Aggregate Bond Index duration increased 15% from 4.21 to 4.85 years over the last six months of 2010 with the most significant change coming from its mortgage-backed securities (MBS) component increasing 83% from 2.18 to 3.99 years. A slowdown in mortgage prepayments and upward movement in interest rates fueled the rise, along with increased issuance of U.S. government debt. This extension in duration increases risk across much of the fixed income spectrum, in our opinion. However, investors who use passive strategies linked to a benchmark are particularly exposed to the market’s increased risk profile.
Fortunately, we have the flexibility to allocate into areas where we think the risk/reward profile is more attractive. Though concerns about rising Treasury rates are timely, we do not believe all fixed income sectors are doomed to negative returns in 2011. For example, we continue to see considerable opportunity in corporate credits. In the investment grade arena, we believe there is ample room for spreads to tighten. In addition, the added yield associated with owning credit can offset some of the volatility in underlying interest rates. We also feel high yield corporate debt offers opportunities, particularly in shorter-duration offerings. There is additional return potential in lower quality debt and we are selectively stepping down the quality spectrum where corporate strength is evident. This enforces our emphasis on credit selection, which we think is critical to driving returns in this volatile and uncertain market.
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(unaudited)
Overall, the fundamentals for many companies have improved, making us more positive on the opportunities ahead. While corporate deleveraging is likely to continue for years, some companies are nearing completion of their balance sheet restructuring and again enforces the value of individual credit selection. Balance sheets and liquidity are generally stronger, inventories are under control and many firms have cut costs and made operational improvements. All of this has helped drive profit margins to near 25-year highs. And management teams are gaining confidence in the recovery. Many firms are now looking to improve their margins through capital expenditures or mergers and acquisition – clear signs of an improving outlook.
In short, we think high-quality companies will continue benefitting in the recovery. In a post-recession world, companies are demonstrating renewed financial discipline with their balance sheets and more emphasis on returns to investors. This combination of corporate strength and discipline, in our opinion, is a very bullish sign for long-term credit investors.
Portfolio Overview
During the volatility and backup in interest rates we held our conviction that credit spreads would tighten further as corporate earnings continued to strengthen and balance sheet leverage declined. Our significant overweighting to corporate credit and our credit selections drove much of the Fund’s outperformance during the period. The fundamental backdrop remains positive for corporate credit in our view. Revenues continue to grow, margins continue to expand and corporations hold record levels of cash on their balance sheets. We believe the improving indicators of economic growth in the U.S. will benefit corporate earnings and ultimately help push underlying Treasury rates somewhat higher over time.
Given this, and the changing inflation expectations, we positioned the Fund for rising rates heading into the latter half of 2010 through shortening duration and holding an underweight position in Treasuries. Though we held beneficial positions in Real Estate Investment Trusts (REITs), our lack of exposure to commercial mortgage-backed securities (CMBS) weighed on comparable returns during the year.
Much of the duration contribution to the Fund, which stood at roughly 96% of the benchmark at year end, stemmed from our corporate credit holdings. While duration positioning is not a main source of alpha for us, we remain interest rate defensive and strive to minimize the effects of interest volatility on the Fund. (Alpha represents the value a portfolio manager has added when taking into account how much risk that was required to generate any excess return.) Our main focus remains on the selection of individual corporate credits, an area where we attempt to generate most of our alpha.
At times, the Fund may own various types of derivative instruments. Please see the Derivative Instruments section in the “Notes to Financial Statements” for a discussion of derivatives used by the Fund.
Contributors
Our holding in GE Capital, the financing arm of industrial conglomerate General Electric, was among our top contributors in 2010. As a relative value opportunity, the market discounted GE Capital’s bonds considerably wider than other AA rated securities due to GE Capital’s wholesale funded business model as opposed to the deposit driven model of traditional banks. As the wholesale funding market recovers, so has investor comfort with GE Capital’s bonds. We like that management is reducing risk within their debt profile by rolling off poor performing assets and alleviating short-term funding needs. GE Capital’s funding ratios are now in line with peers and we expect their leadership in middle market business lending to benefit bondholders in the early stages of economic recovery.
Another individual credit name that aided relative results was Reckson Operating Partnership, a New York City focused office property REIT owned by SL Green Realty. We like the company’s portfolio of high quality assets with long lease durations, many on a triple net basis. We also favor the recovery potential of the NYC office market which outperformed all other markets in 2010 driven by improvements in rent recovery, occupancy gains, and property values. We believe bondholders will continue to benefit as management actively pursues an investment grade rating to further reduce their cost of capital.
Detractors
The top individual detractor during the period was Regions Financial Corp. We initially were attracted to this regional provider of commercial, retail and mortgage banking services given its improving credit performance, government support and new management team. Investors grew impatient with Regions’ slower-than-expected pace of recovery. Management subsequently surprised the street by terminating the firm’s risk management leadership without notice. Immediately afterwards, Regions was downgraded by a rating agency and the bonds underperformed. It was clear to us our investment thesis
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Janus Flexible Bond Fund (unaudited)
was compromised and we subsequently exited the position.
ArcelorMittal, the world’s largest steel maker detracted from relative performance during the period due to our shorter duration position. We like the firm’s broad product offerings and diverse geography, low-cost producer status and management’s commitment to an improving credit profile. The company’s total debt profile rallied strongly during the period, however our position in shorter maturities caused us to miss a portion of the relative performance in the longer bonds.
Outlook
We have become more optimistic on the U.S. economy overall but remain cognizant of the challenges and valuations within fixed income. With the deleveraging process nearing completion for many companies, balance sheets remain strong and firms are now looking to facilitate margin expansion and growth. At the same time we should start to see an increase in shareholder friendly activity in the form of dividend increases and share repurchase programs. These early-stage shareholder friendly activities should not impair balance sheets given their strength, and should be a positive for fixed income investors. At this point in the U.S. recovery, costs have been cut, operational improvements have been made and inventories are under control.
With lackluster labor markets, one might assume that consumer spending would be the last area to recover. But the U.S. consumer remains resilient through the economic uncertainty, tight lending markets and an unemployment rate above 9%. The extension of the Bush tax rates appeared to bolstered confidence, and the consumer seems ready to help spur economic growth. In addition, the Fed’s aggressive stimulus programs have been designed to keep liquidity high in the system, rein in higher rates (which is not working) and allow businesses and consumers to refinance higher coupon debt. The programs should help improve overall credit creation. They have also targeted the mortgage market, aimed at encouraging risk-taking and more confidence in the economy. Ideally, strength in consumer-driven sectors will create sufficient momentum to keep the recovery rolling, sparking more hiring and creating a positive feedback loop.
Despite the U.S. consumer’s strength, the economy continues to face pockets of weakness, particularly in regional manufacturing and housing. The U.S. housing market continued to deteriorate in 2010 with declining investment and falling home prices. We think the large number of foreclosures and the shadow inventory will pressure prices for years. The employment situation also remains challenging with the jobless rate likely to stay elevated well into 2011. Other headwinds include the European sovereign debt problems, elevated fiscal deficits in the U.S. and the large financing needs of the U.S. government.
Inflation remains another area of concern. Pressures are rising in certain segments of the economy and businesses are seeing varying degrees of cost increases. However, inflation has stayed under control at the consumer level, despite meaningfully higher costs in oil and gasoline, as well as most foodstuffs. Core consumer prices are likely to remain tame until the housing market recovers enough to pressure owner’s equivalent rent, a big component of inflation. In addition, a significant improvement in hiring as well as wages would spur more inflation concerns. The dramatic jump in rates in December enforces the argument that the market seems more focused on inflation expectations than fundamental indicators of rising prices. We will be paying close attention to the inputs into the inflation outlook as well as monitoring inflation expectations to help navigate market volatility.
In terms of positioning, we remain overweight corporate credit, selectively stepping down in the ratings spectrum to lower-rated, potentially higher yielding opportunities only if they fit our stringent criteria for inclusion in the Fund. We will not compromise on quality to “stretch” for yield. We maintained a zero weight to agencies at the end of the period as we saw limited value in the sector relative to Treasuries. We also finished the period without an allocation to mortgages. Our concerns with mortgages center around duration extension due to slowing prepayments and challenging valuations due to narrow spreads. In recent months, we have seen the duration concerns play out to some extent and we will continue to monitor mortgages carefully for attractive entry points. We maintained a modest weight in Treasuries to insure against a fear driven flight to safety through period end.
Given the high levels of market volatility and economic uncertainty, we believe that individual security selection will be the most important driver of returns for bond investors. As always, we will continue to focus on opportunities that offer the best risk-adjusted returns.
Thank you for entrusting your assets to us and your investment in Janus Flexible Bond Fund.
8 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Janus Flexible Bond Fund At A Glance
Fund Profile
December 31, 2010
Weighted Average Maturity | 6.4 Years | |
Average Effective Duration* | 4.6 Years | |
30-day Current Yield** | ||
Class A Shares at NAV | ||
Without Reimbursement | 2.76% | |
With Reimbursement | 2.76% | |
Class A Shares at MOP | ||
Without Reimbursement | 2.63% | |
With Reimbursement | 2.63% | |
Class C Shares*** | ||
Without Reimbursement | 1.94% | |
With Reimbursement | 1.94% | |
Class D Shares | ||
Without Reimbursement | 2.96% | |
With Reimbursement | 2.96% | |
Class I Shares | ||
Without Reimbursement | 3.04% | |
With Reimbursement | 3.04% | |
Class R Shares | ||
Without Reimbursement | 2.35% | |
With Reimbursement | 2.35% | |
Class S Shares | ||
Without Reimbursement | 2.61% | |
With Reimbursement | 2.61% | |
Class T Shares | ||
Without Reimbursement | 2.86% | |
With Reimbursement | 2.86% | |
Number of Bonds/Notes | 293 |
* | A theoretical measure of price volatility | |
** | Yield will fluctuate | |
*** | Does not include the 1.00% contingent deferred sales charge. |
Ratings†Summary – (% of Investment Securities)
December 31, 2010
AAA | 27.4% | |
AA | 5.0% | |
A | 14.2% | |
BBB | 32.7% | |
BB | 15.9% | |
B | 4.6% | |
Other | 0.2% |
† | Rated by Standard & Poor’s |
Significant Areas of Investment – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18b07.gif)
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18p07.gif)
Emerging markets comprised 0.7% of total net assets.
Janus Fixed Income & Money Market Funds | 9
Table of Contents
Janus Flexible Bond Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18m07.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||||
Fiscal | One | Five | Ten | Since | Total Annual Fund | Net Annual Fund | |||||||||
Year-to-Date | Year | Year | Year | Inception* | Operating Expenses | Operating Expenses | |||||||||
Janus Flexible Bond Fund – Class A Shares | |||||||||||||||
NAV | 2.26% | 7.38% | 7.25% | 6.51% | 7.57% | 0.76% | 0.76% | ||||||||
MOP | –2.56% | 2.26% | 6.21% | 5.99% | 7.35% | ||||||||||
Janus Flexible Bond Fund – Class C Shares | |||||||||||||||
NAV | 1.87% | 6.57% | 6.53% | 5.78% | 6.90% | 1.51% | 1.51% | ||||||||
CDSC | 0.89% | 5.57% | 6.53% | 5.78% | 6.90% | ||||||||||
Janus Flexible Bond Fund – Class D Shares(1) | 2.35% | 7.53% | 7.30% | 6.54% | 7.59% | 0.60% | 0.60% | ||||||||
Janus Flexible Bond Fund – Class I Shares | 2.37% | 7.59% | 7.29% | 6.54% | 7.58% | 0.59% | 0.55% | ||||||||
Janus Flexible Bond Fund – Class R Shares | 2.03% | 6.91% | 6.80% | 6.05% | 7.17% | 1.20% | 1.20% | ||||||||
Janus Flexible Bond Fund – Class S Shares | 2.26% | 7.27% | 7.07% | 6.31% | 7.43% | 0.95% | 0.95% | ||||||||
Janus Flexible Bond Fund – Class T Shares | 2.29% | 7.45% | 7.29% | 6.54% | 7.58% | 0.70% | 0.70% | ||||||||
Barclays Capital U.S. Aggregate Bond Index | 1.15% | 6.54% | 5.80% | 5.84% | 7.31%** | ||||||||||
Lipper Quartile – Class T Shares | – | 3rd | 1st | 1st | 1st | ||||||||||
Lipper Ranking – based on total returns for Intermediate Investment Grade Debt Funds | – | 300/567 | 33/390 | 27/257 | 2/21 | ||||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 4.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
See important disclosures on the next page.
10 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, Class R Shares and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class R Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund’s performance may be affected by risks that include those associated with non-investment grade debt securities, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Funds that invest in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the Fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of Fixed Income Funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the Fund and selling of bonds within the Fund by the portfolio managers.
High-yield/high-risk bonds, also known as “junk” bonds, involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gains or result in losses by offsetting positive returns in other securities the Fund owns.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus Flexible Bond Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class R Shares, and Class S Shares commenced operations on July 6, 2009. Performance shown for each share class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010 reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Janus Fixed Income & Money Market Funds | 11
Table of Contents
Janus Flexible Bond Fund (unaudited)
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return or yield, and therefore the ranking for the period.
July 9, 1987 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The Fund’s inception date – July 7, 1987 | |
** | The Barclays Capital U.S. Aggregate Bond Index’s since inception returns are calculated from June 30, 1987. | |
(1) | Closed to new investors. |
12 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,022.60 | $ | 3.87 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.37 | $ | 3.87 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,018.70 | $ | 7.73 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.54 | $ | 7.73 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,023.50 | $ | 3.01 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.23 | $ | 3.01 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,023.70 | $ | 2.81 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.43 | $ | 2.80 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class R Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,020.30 | $ | 6.16 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.11 | $ | 6.16 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,021.70 | $ | 4.84 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.42 | $ | 4.84 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,022.90 | $ | 3.62 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.63 | $ | 3.62 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.76% for Class A Shares, 1.52% for Class C Shares, 0.59% for Class D Shares, 0.55% for Class I Shares, 1.21% for Class R Shares, 0.95% for Class S Shares and 0.71% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Fixed Income & Money Market Funds | 13
Table of Contents
Janus Flexible Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Bank Loans – 2.2% | ||||||||||
Aerospace and Defense – 0.5% | ||||||||||
$15,338,000 | TransDigm Group, Inc. 5.0000%, 12/6/16‡ | $ | 15,475,582 | |||||||
Automotive – Cars and Light Trucks – 0.2% | ||||||||||
4,938,764 | Ford Motor Co. 3.0200%, 12/15/13‡ | 3,515,319 | ||||||||
1,415,482 | Ford Motor Co. 3.0400%, 12/15/13‡ | 1,412,283 | ||||||||
4,927,602 | ||||||||||
Data Processing and Management – 0.1% | ||||||||||
2,039,888 | Fidelity National Information 5.2500%, 7/18/16‡ | 2,062,816 | ||||||||
Retail – Apparel and Shoe – 0.9% | ||||||||||
15,569,116 | Phillips-Van Heusen Corp. 0%, 5/6/16 (a),‡ | 15,759,838 | ||||||||
14,402,028 | Phillips-Van Heusen Corp. 4.7500%, 5/6/16‡ | 14,578,453 | ||||||||
30,338,291 | ||||||||||
Retail – Restaurants – 0.5% | ||||||||||
2,010,596 | DineEquity, Inc. 0%, 10/19/17 (a),‡ | 2,038,844 | ||||||||
15,275,462 | DineEquity, Inc. 6.0000%, 10/19/17‡ | 15,490,083 | ||||||||
17,528,927 | ||||||||||
Total Bank Loans (cost $70,272,530) | 70,333,218 | |||||||||
Corporate Bonds – 68.8% | ||||||||||
Advertising Services – 0.4% | ||||||||||
1,393,000 | WPP Finance UK 5.8750%, 6/15/14 | 1,505,035 | ||||||||
9,142,000 | WPP Finance UK 8.0000%, 9/15/14 | 10,517,386 | ||||||||
12,022,421 | ||||||||||
Agricultural Chemicals – 0.3% | ||||||||||
6,158,000 | Incitec Pivot, Ltd. 4.0000%, 12/7/15 (144A) | 6,001,741 | ||||||||
3,978,000 | Mosaic Co. 7.6250%, 12/1/16 (144A) | 4,280,407 | ||||||||
10,282,148 | ||||||||||
Airlines – 0.1% | ||||||||||
3,591,000 | Southwest Airlines Co. 5.2500%, 10/1/14 | 3,776,788 | ||||||||
Automotive – Cars and Light Trucks – 0.6% | ||||||||||
9,066,000 | Daimler Finance North America LLC 6.5000%, 11/15/13 | 10,263,338 | ||||||||
7,468,000 | Ford Motor Co. 7.4500%, 7/16/31 | 8,000,095 | ||||||||
18,263,433 | ||||||||||
Beverages – Non-Alcoholic – 1.6% | ||||||||||
30,675,000 | The Coca-Cola Co. 0.7500%, 11/15/13 | 30,277,636 | ||||||||
20,767,000 | The Coca-Cola Co. 1.5000%, 11/15/15 | 19,933,039 | ||||||||
50,210,675 | ||||||||||
Brewery – 0.7% | ||||||||||
8,862,000 | Anheuser-Busch InBev Worldwide, Inc. 7.2000%, 1/15/14 (144A) | 10,134,539 | ||||||||
8,645,000 | Anheuser-Busch InBev Worldwide, Inc. 7.7500%, 1/15/19 (144A) | 10,757,388 | ||||||||
20,891,927 | ||||||||||
Building – Residential and Commercial – 0.3% | ||||||||||
3,269,000 | D.R. Horton, Inc. 7.8750%, 8/15/11 | 3,383,415 | ||||||||
4,686,000 | MDC Holdings, Inc. 5.3750%, 12/15/14 | 4,720,934 | ||||||||
8,104,349 | ||||||||||
Building Products – Cement and Aggregate – 1.5% | ||||||||||
1,173,000 | CRH America, Inc. 5.6250%, 9/30/11 | 1,209,985 | ||||||||
4,468,000 | CRH America, Inc. 4.1250%, 1/15/16 | 4,439,449 | ||||||||
6,620,000 | CRH America, Inc. 8.1250%, 7/15/18 | 7,652,071 | ||||||||
16,451,000 | CRH America, Inc. 5.7500%, 1/15/21 | 16,263,607 | ||||||||
11,260,000 | Hanson, Ltd. 6.1250%, 8/15/16 | 11,485,200 | ||||||||
7,058,000 | Holcim U.S. Finance (U.S. Shares) 6.0000%, 12/30/19 (144A) | 7,329,338 | ||||||||
48,379,650 | ||||||||||
Cable Television – 0.4% | ||||||||||
13,355,000 | Comcast Corp. 5.1500%, 3/1/20 | 14,027,344 | ||||||||
Chemicals – Diversified – 1.8% | ||||||||||
3,635,000 | Dow Chemical Co. 7.6000%, 5/15/14 | 4,192,565 | ||||||||
20,962,000 | Dow Chemical Co. 8.5500%, 5/15/19 | 26,270,585 | ||||||||
12,462,000 | Dow Chemical Co. 4.2500%, 11/15/20 | 11,937,325 | ||||||||
13,465,000 | LBI Escrow Corp. 8.0000%, 11/1/17 (144A) | 14,895,656 | ||||||||
57,296,131 | ||||||||||
Chemicals – Specialty – 0.5% | ||||||||||
12,652,000 | Ashland, Inc. 9.1250%, 6/1/17 | 14,581,430 | ||||||||
Coal – 0.1% | ||||||||||
2,125,000 | Peabody Energy Corp. 6.5000%, 9/15/20 | 2,268,438 | ||||||||
Coatings and Paint Products – 0.3% | ||||||||||
9,685,000 | RPM International, Inc. 6.1250%, 10/15/19 | 10,032,721 | ||||||||
Commercial Banks – 3.6% | ||||||||||
9,662,000 | American Express Bank FSB 5.5000%, 4/16/13 | 10,413,636 | ||||||||
16,429,000 | CIT Group, Inc. 7.0000%, 5/1/13 | 16,757,580 | ||||||||
6,620,000 | Credit Suisse New York 5.0000%, 5/15/13 | 7,124,987 | ||||||||
7,595,000 | Credit Suisse New York 5.5000%, 5/1/14 | 8,329,072 |
See Notes to Schedules of Investments and Financial Statements.
14 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Commercial Banks – (continued) | ||||||||||
$5,770,000 | Discover Bank 8.7000%, 11/18/19 | $ | 6,791,948 | |||||||
6,429,000 | Discover Bank 7.0000%, 4/15/20 | 6,911,445 | ||||||||
15,794,000 | HSBC USA, Inc. 5.0000%, 9/27/20 | 15,288,181 | ||||||||
20,774,000 | Royal Bank of Scotland PLC 3.9500%, 9/21/15 | 20,421,507 | ||||||||
15,800,000 | SVB Financial Group 5.3750%, 9/15/20 | 15,192,980 | ||||||||
7,564,000 | Zions Bancorp. 7.7500%, 9/23/14 | 7,885,545 | ||||||||
115,116,881 | ||||||||||
Computer Services – 0.2% | ||||||||||
5,376,000 | Affiliated Computer Services, Inc. 5.2000%, 6/1/15 | 5,705,129 | ||||||||
Computers – Memory Devices – 0.6% | ||||||||||
9,123,000 | Seagate Technology 6.3750%, 10/1/11 | 9,362,479 | ||||||||
7,306,000 | Seagate Technology 10.0000%, 5/1/14 (144A) | 8,566,285 | ||||||||
17,928,764 | ||||||||||
Containers – Metal and Glass – 0.6% | ||||||||||
3,269,000 | Ball Corp. 7.1250%, 9/1/16 | 3,522,348 | ||||||||
4,504,000 | Ball Corp. 6.6250%, 3/15/18 | 4,594,080 | ||||||||
3,632,000 | Ball Corp. 7.3750%, 9/1/19 | 3,904,400 | ||||||||
8,261,000 | Ball Corp. 5.7500%, 5/15/21 | 7,992,517 | ||||||||
20,013,345 | ||||||||||
Data Processing and Management – 0.9% | ||||||||||
10,517,000 | Fiserv, Inc. 3.1250%, 10/1/15 | 10,413,744 | ||||||||
18,633,000 | Fiserv, Inc. 4.6250%, 10/1/20 | 18,097,953 | ||||||||
28,511,697 | ||||||||||
Diversified Banking Institutions – 5.4% | ||||||||||
15,975,000 | Bank of America Corp. 5.6250%, 7/1/20 | 16,286,385 | ||||||||
13,874,000 | Citigroup, Inc. 5.0000%, 9/15/14 | 14,352,348 | ||||||||
7,044,000 | Citigroup, Inc. 4.7500%, 5/19/15 | 7,375,751 | ||||||||
29,000,000 | Citigroup, Inc. 5.3750%, 8/9/20 | 30,131,203 | ||||||||
12,930,000 | GMAC, Inc. 6.8750%, 9/15/11 | 13,285,575 | ||||||||
3,271,000 | Goldman Sachs Group, Inc. 3.7000%, 8/1/15 | 3,332,861 | ||||||||
23,371,000 | Goldman Sachs Group, Inc. 5.3750%, 3/15/20 | 24,150,680 | ||||||||
8,979,000 | JPMorgan Chase & Co. 6.0000%, 1/15/18 | 10,027,262 | ||||||||
7,368,000 | JPMorgan Chase & Co. 4.4000%, 7/22/20 | 7,251,925 | ||||||||
11,098,000 | JPMorgan Chase & Co. 4.2500%, 10/15/20 | 10,838,862 | ||||||||
14,159,000 | Morgan Stanley 4.0000%, 7/24/15 | 14,232,414 | ||||||||
6,057,000 | Morgan Stanley 3.4500%, 11/2/15 | 5,905,308 | ||||||||
6,449,000 | Morgan Stanley 5.6250%, 9/23/19 | 6,575,936 | ||||||||
7,402,000 | Morgan Stanley 5.5000%, 7/24/20 | 7,478,048 | ||||||||
171,224,558 | ||||||||||
Diversified Financial Services – 2.4% | ||||||||||
3,777,000 | General Electric Capital Corp. 4.8000%, 5/1/13 | 4,037,949 | ||||||||
5,296,000 | General Electric Capital Corp. 5.9000%, 5/13/14 | 5,861,396 | ||||||||
26,428,000 | General Electric Capital Corp. 6.0000%, 8/7/19 | 29,403,555 | ||||||||
21,295,000 | General Electric Capital Corp. 5.5000%, 1/8/20 | 22,774,726 | ||||||||
13,670,000 | General Electric Capital Corp. 6.8750%, 1/10/39 | 15,797,872 | ||||||||
77,875,498 | ||||||||||
Diversified Minerals – 1.6% | ||||||||||
16,045,000 | FMG Resources August 2006 Pty, Ltd. 7.0000%, 11/1/15 (144A) | 16,446,125 | ||||||||
3,591,000 | Teck Resources, Ltd. 7.0000%, 9/15/12 | 3,819,118 | ||||||||
3,192,000 | Teck Resources, Ltd. 9.7500%, 5/15/14 | 3,991,756 | ||||||||
6,770,000 | Teck Resources, Ltd. 5.3750%, 10/1/15 | 7,433,900 | ||||||||
2,578,000 | Teck Resources, Ltd. 10.2500%, 5/15/16 | 3,190,275 | ||||||||
9,262,000 | Teck Resources, Ltd. 6.1250%, 10/1/35 | 9,971,608 | ||||||||
4,986,000 | Vale Overseas, Ltd. 4.6250%, 9/15/20 | 4,936,559 | ||||||||
49,789,341 | ||||||||||
Diversified Operations – 0.7% | ||||||||||
5,085,000 | SPX Corp 7.6250%, 12/15/14 | 5,529,937 | ||||||||
15,359,000 | Tyco Electronics Group S.A. 6.0000%, 10/1/12 | 16,513,490 | ||||||||
22,043,427 | ||||||||||
Electric – Integrated – 2.1% | ||||||||||
6,153,000 | CMS Energy Corp. 8.5000%, 4/15/11 | 6,271,876 | ||||||||
6,051,000 | CMS Energy Corp. 1.2391%, 1/15/13‡ | 5,937,544 | ||||||||
8,929,000 | CMS Energy Corp. 4.2500%, 9/30/15 | 8,841,335 | ||||||||
6,182,000 | CMS Energy Corp. 5.0500%, 2/15/18 | 6,112,663 | ||||||||
6,298,000 | Monongahela Power Co. 6.7000%, 6/15/14 | 6,982,933 | ||||||||
2,931,000 | Pacific Gas & Electric Co. 4.8000%, 3/1/14 | 3,149,846 |
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 15
Table of Contents
Janus Flexible Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Electric – Integrated – (continued) | ||||||||||
$8,304,000 | Public Service Co. of Colorado 3.2000%, 11/15/20 | $ | 7,829,700 | |||||||
6,079,000 | Virginia Electric and Power Co. 5.1000%, 11/30/12 | 6,533,411 | ||||||||
15,935,000 | Xcel Energy, Inc. 4.7000%, 5/15/20 | 16,405,067 | ||||||||
68,064,375 | ||||||||||
Electronic Components – Semiconductors – 1.2% | ||||||||||
6,198,000 | National Semiconductor Corp. 6.1500%, 6/15/12 | 6,595,298 | ||||||||
18,272,000 | National Semiconductor Corp. 3.9500%, 4/15/15 | 18,609,630 | ||||||||
12,854,000 | National Semiconductor Corp. 6.6000%, 6/15/17 | 14,200,508 | ||||||||
39,405,436 | ||||||||||
Electronic Connectors – 0.5% | ||||||||||
15,255,000 | Amphenol Corp. 4.7500%, 11/15/14 | 16,297,191 | ||||||||
Electronic Measuring Instruments – 0.1% | ||||||||||
4,735,000 | Agilent Technologies, Inc. 2.5000%, 7/15/13 | 4,790,513 | ||||||||
Electronics – Military – 1.5% | ||||||||||
2,249,000 | L-3 Communications Corp. 5.8750%, 1/15/15 | 2,291,169 | ||||||||
32,001,000 | L-3 Communications Corp. 6.3750%, 10/15/15 | 32,961,030 | ||||||||
4,470,000 | L-3 Communications Corp. 5.2000%, 10/15/19 | 4,544,296 | ||||||||
7,449,000 | L-3 Communications Corp. 4.7500%, 7/15/20 | 7,318,501 | ||||||||
47,114,996 | ||||||||||
Enterprise Software/Services – 0.3% | ||||||||||
7,651,000 | BMC Software, Inc. 7.2500%, 6/1/18 | 8,851,526 | ||||||||
Finance – Auto Loans – 0.7% | ||||||||||
5,085,000 | Ford Motor Credit Co. LLC 7.2500%, 10/25/11 | 5,255,582 | ||||||||
4,973,000 | Ford Motor Credit Co. LLC 7.5000%, 8/1/12 | 5,287,338 | ||||||||
10,012,000 | Ford Motor Credit Co. LLC 6.6250%, 8/15/17 | 10,522,522 | ||||||||
2,120,000 | Hyundai Capital America 3.7500%, 4/6/16 (144A) | 2,082,107 | ||||||||
23,147,549 | ||||||||||
Finance – Credit Card – 0.4% | ||||||||||
9,751,000 | American Express Co. 6.8000%, 9/1/66‡ | 9,653,490 | ||||||||
4,050,000 | American Express Credit Co. 7.3000%, 8/20/13 | 4,563,775 | ||||||||
14,217,265 | ||||||||||
Finance – Investment Bankers/Brokers – 1.9% | ||||||||||
5,947,000 | Charles Schwab Corp. 4.4500%, 7/22/20 | 5,924,015 | ||||||||
8,255,000 | Jefferies Group, Inc. 3.8750%, 11/9/15 | 8,113,872 | ||||||||
7,446,000 | Jefferies Group, Inc. 8.5000%, 7/15/19 | 8,513,615 | ||||||||
8,840,000 | Lazard Group LLC 7.1250%, 5/15/15 | 9,518,877 | ||||||||
4,535,000 | Schwab Capital Trust I 7.5000%, 11/15/37‡ | 4,691,185 | ||||||||
16,083,000 | TD Ameritrade Holding Corp. 4.1500%, 12/1/14 | 16,631,334 | ||||||||
5,564,000 | TD Ameritrade Holding Corp. 5.6000%, 12/1/19 | 5,826,665 | ||||||||
59,219,563 | ||||||||||
Finance – Other Services – 0.3% | ||||||||||
9,673,000 | CME Group, Inc. 5.7500%, 2/15/14 | 10,710,400 | ||||||||
Food – Meat Products – 1.3% | ||||||||||
2,263,000 | Smithfield Foods, Inc. 7.7500%, 5/15/13 | 2,411,510 | ||||||||
34,879,000 | Tyson Foods, Inc. 7.3500%, 4/1/16‡ | 38,257,903 | ||||||||
40,669,413 | ||||||||||
Food – Miscellaneous/Diversified – 2.1% | ||||||||||
12,775,000 | Corn Products International, Inc. 3.2000%, 11/1/15 | 12,813,861 | ||||||||
10,360,000 | Corn Products International, Inc. 6.6250%, 4/15/37 | 10,829,432 | ||||||||
8,069,000 | Del Monte Corp. 6.7500%, 2/15/15 | 8,240,466 | ||||||||
2,065,000 | Dole Food Co., Inc. 13.8750%, 3/15/14 | 2,521,386 | ||||||||
9,215,000 | Kraft Foods, Inc. 2.6250%, 5/8/13 | 9,476,872 | ||||||||
8,649,000 | Kraft Foods, Inc. 5.3750%, 2/10/20 | 9,308,651 | ||||||||
12,722,000 | Kraft Foods, Inc. 6.5000%, 2/9/40 | 14,256,642 | ||||||||
67,447,310 | ||||||||||
Gas – Distribution – 0.1% | ||||||||||
1,816,000 | Southern Star Central Gas Pipeline, Inc. 6.0000%, 6/1/16 (144A) | 1,969,697 | ||||||||
Gold Mining – 0.2% | ||||||||||
6,276,000 | Gold Fields Orogen Holding BVI, Ltd. 4.8750%, 10/7/20 (144A) | 6,003,835 | ||||||||
Hotels and Motels – 1.5% | ||||||||||
6,776,000 | Hyatt Hotels Corp. 5.7500%, 8/15/15 (144A) | 7,087,337 | ||||||||
2,179,000 | Hyatt Hotels Corp. 6.8750%, 8/15/19 (144A) | 2,382,107 | ||||||||
9,557,000 | Marriott International, Inc. 4.6250%, 6/15/12 | 9,937,789 | ||||||||
2,679,000 | Marriott International, Inc. 5.6250%, 2/15/13 | 2,873,198 | ||||||||
1,895,000 | Starwood Hotels & Resorts Worldwide, Inc. 7.8750%, 10/15/14 | 2,150,825 | ||||||||
2,479,000 | Starwood Hotels & Resorts Worldwide, Inc. 6.7500%, 5/15/18 | 2,714,505 | ||||||||
10,170,000 | Starwood Hotels & Resorts Worldwide, Inc. 7.1500%, 12/1/19 | 11,237,850 | ||||||||
8,385,000 | Wyndham Worldwide Corp. 5.7500%, 2/1/18 | 8,526,170 | ||||||||
46,909,781 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
16 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Investment Management and Advisory Services – 1.0% | ||||||||||
$8,045,000 | Ameriprise Financial, Inc. 7.3000%, 6/28/19 | $ | 9,506,245 | |||||||
3,723,000 | Ameriprise Financial, Inc. 5.3000%, 3/15/20 | 3,916,816 | ||||||||
10,521,000 | Ameriprise Financial, Inc. 7.5180%, 6/1/66‡ | 10,941,840 | ||||||||
7,300,000 | FMR LLC 6.4500%, 11/15/39 (144A) | 6,942,731 | ||||||||
31,307,632 | ||||||||||
Life and Health Insurance – 0.1% | ||||||||||
2,687,000 | Prudential Financial, Inc. 4.7500%, 6/13/15 | 2,830,964 | ||||||||
Medical – Biomedical and Genetic – 1.0% | ||||||||||
4,609,000 | Bio-Rad Laboratories, Inc. 8.0000%, 9/15/16 | 5,000,765 | ||||||||
7,521,000 | Celgene Corp. 2.4500%, 10/15/15 | 7,305,358 | ||||||||
10,449,000 | Celgene Corp. 3.9500%, 10/15/20 | 9,934,230 | ||||||||
4,738,000 | Genzyme Corp. 3.6250%, 6/15/15 | 4,864,197 | ||||||||
5,930,000 | Genzyme Corp. 5.0000%, 6/15/20 | 6,225,699 | ||||||||
33,330,249 | ||||||||||
Medical – Drugs – 0.2% | ||||||||||
5,785,000 | Abbott Laboratories 4.1250%, 5/27/20 | 5,881,789 | ||||||||
Medical – Hospitals – 0.4% | ||||||||||
12,157,000 | HCA, Inc. 9.2500%, 11/15/16 | 12,969,999 | ||||||||
Medical – Wholesale Drug Distributors – 0.1% | ||||||||||
3,704,000 | McKesson Corp. 6.5000%, 2/15/14 | 4,161,366 | ||||||||
Medical Labs and Testing Services – 0.3% | ||||||||||
8,499,000 | Roche Holdings, Inc. 6.0000%, 3/1/19 (144A) | 9,882,969 | ||||||||
Medical Products – 0.5% | ||||||||||
6,286,000 | CareFusion Corp. 4.1250%, 8/1/12 | 6,549,207 | ||||||||
7,990,000 | Hospira, Inc. 6.4000%, 5/15/15 | 9,046,358 | ||||||||
15,595,565 | ||||||||||
Metal – Copper – 0.6% | ||||||||||
9,226,000 | Freeport-McMoRan Copper & Gold, Inc. 8.2500%, 4/1/15 | 9,721,897 | ||||||||
9,972,000 | Freeport-McMoRan Copper & Gold, Inc. 8.3750%, 4/1/17 | 11,031,525 | ||||||||
20,753,422 | ||||||||||
Metal Processors and Fabricators – 0.1% | ||||||||||
2,179,000 | Timken Co. 6.0000%, 9/15/14 | 2,398,602 | ||||||||
Multi-Line Insurance – 1.4% | ||||||||||
10,337,000 | American International Group, Inc. 6.4000%, 12/15/20 | 10,845,673 | ||||||||
9,623,000 | MetLife, Inc. 2.3750%, 2/6/14 | 9,668,671 | ||||||||
4,194,000 | MetLife, Inc. 6.7500%, 6/1/16 | 4,864,885 | ||||||||
4,908,000 | MetLife, Inc. 7.7170%, 2/15/19 | 6,025,704 | ||||||||
8,192,000 | MetLife, Inc. 4.7500%, 2/8/21 | 8,364,220 | ||||||||
4,168,000 | MetLife, Inc. 5.8750%, 2/6/41 | 4,394,439 | ||||||||
44,163,592 | ||||||||||
Multimedia – 0.8% | ||||||||||
14,411,000 | NBC Universal, Inc. 2.8750%, 4/1/16 (144A) | 14,078,942 | ||||||||
8,310,000 | NBC Universal, Inc. 5.9500%, 4/1/41 (144A) | 8,309,152 | ||||||||
4,336,000 | Time Warner, Inc. 3.1500%, 7/15/15 | 4,405,454 | ||||||||
26,793,548 | ||||||||||
Non-Hazardous Waste Disposal – 0.3% | ||||||||||
8,815,000 | Allied Waste North America, Inc. 7.1250%, 5/15/16 | 9,332,881 | ||||||||
Office Automation and Equipment – 0.2% | ||||||||||
1,208,000 | Xerox Corp. 5.6500%, 5/15/13 | 1,309,305 | ||||||||
2,953,000 | Xerox Corp. 8.2500%, 5/15/14 | 3,446,949 | ||||||||
2,622,000 | Xerox Corp. 5.6250%, 12/15/19 | 2,810,624 | ||||||||
7,566,878 | ||||||||||
Oil and Gas Drilling – 0.6% | ||||||||||
17,733,000 | Nabors Industries, Inc. 5.0000%, 9/15/20 (144A) | 17,201,773 | ||||||||
2,402,000 | Noble Holding International, Ltd. 3.4500%, 8/1/15 | 2,452,879 | ||||||||
19,654,652 | ||||||||||
Oil Companies – Exploration and Production – 0.5% | ||||||||||
9,473,000 | Forest Oil Corp. 8.0000%, 12/15/11 | 9,899,285 | ||||||||
5,321,000 | Forest Oil Corp. 8.5000%, 2/15/14 | 5,813,192 | ||||||||
15,712,477 | ||||||||||
Oil Companies – Integrated – 0.8% | ||||||||||
18,040,000 | BP Capital Markets PLC 3.1250%, 10/1/15 | 18,027,606 | ||||||||
8,336,000 | BP Capital Markets PLC 4.5000%, 10/1/20 | 8,315,902 | ||||||||
26,343,508 | ||||||||||
Oil Refining and Marketing – 0.6% | ||||||||||
7,351,000 | Motiva Enterprises LLC 5.7500%, 1/15/20 (144A) | 8,245,698 | ||||||||
12,241,000 | NuStar Logistics L.P. 4.8000%, 9/1/20 | 11,872,019 | ||||||||
20,117,717 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 17
Table of Contents
Janus Flexible Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Paper and Related Products – 0.7% | ||||||||||
$4,823,000 | Georgia-Pacific LLC 7.1250%, 1/15/17 (144A) | $ | 5,136,495 | |||||||
16,421,000 | Georgia-Pacific LLC 5.4000%, 11/1/20 (144A) | 16,235,098 | ||||||||
21,371,593 | ||||||||||
Pharmacy Services – 0.3% | ||||||||||
9,032,000 | Express Scripts, Inc. 6.2500%, 6/15/14 | 10,097,433 | ||||||||
Pipelines – 2.9% | ||||||||||
10,481,000 | DCP Midstream Operating L.P. 3.2500%, 10/1/15 | 10,308,734 | ||||||||
1,862,000 | El Paso Pipeline Partners Operating Co. LLC 6.5000%, 4/1/20 | 1,953,594 | ||||||||
6,608,000 | Energy Transfer Equity L.P. 7.5000%, 10/15/20 | 6,806,240 | ||||||||
3,632,000 | Energy Transfer Partners L.P. 5.9500%, 2/1/15 | 3,984,010 | ||||||||
2,294,000 | Kinder Morgan Energy Partners L.P. 5.9500%, 2/15/18 | 2,526,415 | ||||||||
15,810,000 | Kinder Morgan Finance Co. ULC 5.7000%, 1/5/16 | 16,007,625 | ||||||||
2,347,000 | Plains All American Pipeline L.P. 8.7500%, 5/1/19 | 2,912,615 | ||||||||
13,760,000 | Plains All American Pipeline L.P. / PAA Finance Corp. 3.9500%, 9/15/15 | 14,217,905 | ||||||||
20,730,000 | TransCanada Pipelines, Ltd. 3.8000%, 10/1/20 | 20,228,894 | ||||||||
3,760,000 | Williams Partners L.P. 3.8000%, 2/15/15 | 3,885,595 | ||||||||
10,329,000 | Williams Partners L.P. 4.1250%, 11/15/20 | 9,783,515 | ||||||||
92,615,142 | ||||||||||
Property and Casualty Insurance – 0.1% | ||||||||||
4,808,000 | Fidelity National Financial, Inc. 6.6000%, 5/15/17 | 4,797,192 | ||||||||
Publishing – Newspapers – 0.1% | ||||||||||
1,657,000 | Gannett Co., Inc. 6.3750%, 9/1/15 (144A) | 1,669,428 | ||||||||
Publishing – Periodicals – 0.5% | ||||||||||
15,931,000 | United Business Media Ltd. 5.7500%, 11/3/20 (144A) | 15,294,716 | ||||||||
Real Estate Management/Services – 1.0% | ||||||||||
7,465,000 | AMB Property L.P. 6.1250%, 12/1/16 | 8,120,389 | ||||||||
10,417,000 | AMB Property L.P. 4.0000%, 1/15/18 | 9,889,473 | ||||||||
7,390,000 | AMB Property L.P. 6.6250%, 12/1/19 | 8,108,005 | ||||||||
7,496,000 | CB Richard Ellis Services, Inc. 6.6250%, 10/15/20 (144A) | 7,496,000 | ||||||||
33,613,867 | ||||||||||
Real Estate Operating/Development – 0.3% | ||||||||||
10,500,000 | Post Apartment Homes L.P. 4.7500%, 10/15/17 | 10,080,399 | ||||||||
Reinsurance – 1.6% | ||||||||||
15,255,000 | Berkshire Hathaway Finance Corp. 4.0000%, 4/15/12 | 15,865,017 | ||||||||
11,170,000 | Berkshire Hathaway, Inc. 1.4000%, 2/10/12 | 11,252,099 | ||||||||
11,170,000 | Berkshire Hathaway, Inc. 2.1250%, 2/11/13 | 11,408,189 | ||||||||
11,351,000 | Berkshire Hathaway, Inc. 3.2000%, 2/11/15 | 11,712,870 | ||||||||
50,238,175 | ||||||||||
REIT – Apartments – 0.3% | ||||||||||
8,308,000 | BRE Properties, Inc. 5.2000%, 3/15/21 | 8,382,656 | ||||||||
REIT – Diversified – 0.2% | ||||||||||
6,200,000 | Goodman Funding Pty Ltd. 6.3750%, 11/12/20 (144A) | 5,946,730 | ||||||||
REIT – Health Care – 0.9% | ||||||||||
6,301,000 | Senior Housing Properties Trust 6.7500%, 4/15/20 | 6,655,431 | ||||||||
7,515,000 | Ventas Realty L.P. / Ventas Capital Corp. 3.1250%, 11/30/15 | 7,240,597 | ||||||||
4,156,000 | Ventas Realty L.P. / Ventas Capital Corp. 6.5000%, 6/1/16 | 4,322,032 | ||||||||
6,901,000 | Ventas Realty L.P. / Ventas Capital Corp. 6.5000%, 6/1/16 | 7,176,695 | ||||||||
1,762,000 | Ventas Realty L.P. / Ventas Capital Corp. 6.7500%, 4/1/17 | 1,846,219 | ||||||||
27,240,974 | ||||||||||
REIT – Hotels – 0.7% | ||||||||||
5,523,000 | Host Hotels & Resorts L.P. 7.1250%, 11/1/13 | 5,605,845 | ||||||||
15,349,000 | Host Hotels & Resorts L.P. 6.7500%, 6/1/16 | 15,675,166 | ||||||||
21,281,011 | ||||||||||
REIT – Office Property – 0.7% | ||||||||||
3,729,000 | Reckson Operating Partnership L.P. 6.0000%, 3/31/16 | 3,841,314 | ||||||||
17,961,000 | Reckson Operating Partnership L.P. 7.7500%, 3/15/20 | 19,218,270 | ||||||||
23,059,584 | ||||||||||
REIT – Regional Malls – 1.1% | ||||||||||
17,862,000 | Rouse Co. L.P. 6.7500%, 5/1/13 (144A) | 18,509,497 | ||||||||
15,226,000 | Rouse Co. L.P. 6.7500%, 11/9/15 | 15,758,910 | ||||||||
34,268,407 | ||||||||||
REIT – Warehouse and Industrial – 0.3% | ||||||||||
9,127,000 | ProLogis 6.6250%, 5/15/18 | 9,690,985 | ||||||||
733,000 | ProLogis 6.8750%, 3/15/20 | 778,244 | ||||||||
10,469,229 | ||||||||||
Resorts and Theme Parks – 0.5% | ||||||||||
14,936,000 | Vail Resorts, Inc. 6.7500%, 2/15/14 | 15,122,700 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
18 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Retail – Apparel and Shoe – 0.2% | ||||||||||
$7,512,000 | Phillips-Van Heusen Corp. 7.3750%, 5/15/20 | $ | 7,981,500 | |||||||
Retail – Auto Parts – 0.3% | ||||||||||
10,357,000 | AutoZone, Inc. 4.0000%, 11/15/20 | 9,781,897 | ||||||||
Retail – Computer Equipment – 0% | ||||||||||
1,077,000 | GameStop Corp. 8.0000%, 10/1/12 | 1,101,233 | ||||||||
Retail – Propane Distribution – 0.1% | ||||||||||
4,138,000 | Amerigas Partners L.P. 7.2500%, 5/20/15 | 4,251,795 | ||||||||
Retail – Regional Department Stores – 0.8% | ||||||||||
3,404,000 | JC Penney Corp., Inc. 9.0000%, 8/1/12 | 3,684,830 | ||||||||
4,904,000 | Macy’s Retail Holdings, Inc. 5.7500%, 7/15/14 | 5,185,980 | ||||||||
10,588,000 | Macy’s Retail Holdings, Inc. 5.9000%, 12/1/16 | 11,302,690 | ||||||||
5,632,000 | Macy’s Retail Holdings, Inc. 6.9000%, 4/1/29 | 5,533,440 | ||||||||
25,706,940 | ||||||||||
Retail – Restaurants – 0.6% | ||||||||||
10,492,000 | Brinker International 5.7500%, 6/1/14 | 11,027,071 | ||||||||
9,007,000 | Darden Restaurants, Inc. 5.6250%, 10/15/12 | 9,641,498 | ||||||||
20,668,569 | ||||||||||
Steel – Producers – 0.8% | ||||||||||
2,452,000 | ArcelorMittal 5.3750%, 6/1/13 | 2,606,363 | ||||||||
15,901,000 | ArcelorMittal 5.2500%, 8/5/20 | 15,720,095 | ||||||||
7,798,000 | Steel Dynamics, Inc. 7.6250%, 3/15/20 (144A) | 8,343,860 | ||||||||
26,670,318 | ||||||||||
Super-Regional Banks – 0.7% | ||||||||||
3,337,000 | Comerica, Inc. 3.0000%, 9/16/15 | 3,298,871 | ||||||||
4,359,000 | National City Corp. 6.8750%, 5/15/19 | 4,894,098 | ||||||||
3,761,000 | PNC Funding Corp. 3.6250%, 2/8/15 | 3,888,701 | ||||||||
5,639,000 | PNC Funding Corp. 5.1250%, 2/8/20 | 5,877,485 | ||||||||
3,721,000 | Wells Fargo & Co. 3.6250%, 4/15/15 | 3,858,465 | ||||||||
21,817,620 | ||||||||||
Telecommunication Services – 0.2% | ||||||||||
5,533,000 | Virgin Media Secured Finance PLC 6.5000%, 1/15/18 | 5,823,483 | ||||||||
Telephone – Integrated – 2.1% | ||||||||||
3,887,000 | Qwest Communications International, Inc. 7.5000%, 2/15/14 | 3,935,588 | ||||||||
34,078,000 | Qwest Communications International, Inc. 7.1250%, 4/1/18 (144A) | 35,270,730 | ||||||||
20,194,000 | Sprint Capital Corp. 7.6250%, 1/30/11 | 20,244,485 | ||||||||
7,475,000 | Sprint Capital Corp. 8.3750%, 3/15/12 | 7,904,812 | ||||||||
67,355,615 | ||||||||||
Television – 0.4% | ||||||||||
9,734,000 | CBS Corp. 8.2000%, 5/15/14 | 11,354,614 | ||||||||
2,927,000 | CBS Corp. 4.3000%, 2/15/21 | 2,779,268 | ||||||||
14,133,882 | ||||||||||
Toys – 0.1% | ||||||||||
2,445,000 | Mattel, Inc. 4.3500%, 10/1/20 | 2,369,300 | ||||||||
Transportation – Railroad – 0.9% | ||||||||||
2,598,157 | CSX Corp. 8.3750%, 10/15/14 | 3,022,358 | ||||||||
1,095,000 | Kansas City Southern de Mexico S.A. de C.V. 7.3750%, 6/1/14 | 1,144,275 | ||||||||
15,655,000 | Kansas City Southern de Mexico S.A. de C.V. 8.0000%, 2/1/18 | 16,946,537 | ||||||||
5,337,000 | Kansas City Southern de Mexico S.A. de C.V. 6.6250%, 12/15/20 (144A) | 5,350,343 | ||||||||
1,570,000 | Kansas City Southern Railway 13.0000%, 12/15/13 | 1,868,300 | ||||||||
28,331,813 | ||||||||||
Transportation – Services – 0.6% | ||||||||||
16,662,000 | Asciano Finance, Ltd. 4.6250%, 9/23/20 (144A) | 15,452,372 | ||||||||
4,519,000 | Ryder System, Inc. 3.6000%, 3/1/16 | 4,505,190 | ||||||||
19,957,562 | ||||||||||
Transportation – Truck – 0.5% | ||||||||||
15,787,000 | JB Hunt Transport Services, Inc. 3.3750%, 9/15/15 | 15,594,130 | ||||||||
Total Corporate Bonds (cost $2,141,500,237) | 2,199,057,648 | |||||||||
Preferred Stock – 0.1% | ||||||||||
Diversified Banking Institutions – 0.1% | ||||||||||
152,275 | Citigroup Capital, 0% (cost $3,806,875) | 4,097,720 | ||||||||
U.S. Treasury Notes/Bonds – 27.3% | ||||||||||
U.S. Treasury Notes/Bonds: | ||||||||||
$11,138,000 | 1.1250%, 6/30/11 | 11,189,335 | ||||||||
20,372,000 | 1.0000%, 10/31/11 | 20,491,360 | ||||||||
4,023,000 | 1.0000%, 12/31/11 | 4,049,242 | ||||||||
15,905,000 | 1.1250%, 1/15/12 | 16,032,367 | ||||||||
68,613,000 | 0.8750%, 1/31/12 | 68,996,272 | ||||||||
30,339,000 | 4.6250%, 2/29/12 | 31,823,942 | ||||||||
90,681,000 | 0.8750%, 2/29/12 | 91,208,763 | ||||||||
22,614,000 | 1.3750%, 5/15/12 | 22,914,337 | ||||||||
2,338,000 | 1.5000%, 7/15/12 | 2,376,815 | ||||||||
29,984,000 | 0.6250%, 7/31/12 | 30,065,856 | ||||||||
5,692,000 | 1.3750%, 1/15/13 | 5,778,712 | ||||||||
24,474,000 | 1.3750%, 2/15/13 | 24,843,019 |
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 19
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Janus Flexible Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
$2,562,000 | 1.7500%, 4/15/13 | $ | 2,620,849 | |||||||
58,284,000 | 1.1250%, 6/15/13 | 58,761,929 | ||||||||
95,578,000 | 1.0000%, 7/15/13 | 96,048,244 | ||||||||
5,087,000 | 0.7500%, 8/15/13 | 5,076,668 | ||||||||
5,756,000 | 2.7500%, 10/31/13 | 6,050,546 | ||||||||
35,048,000 | 1.7500%, 1/31/14 | 35,781,835 | ||||||||
5,858,000 | 1.8750%, 2/28/14 | 5,998,955 | ||||||||
4,053,000 | 1.7500%, 3/31/14 | 4,132,475 | ||||||||
28,490,000 | 2.2500%, 5/31/14** | 29,471,566 | ||||||||
13,906,000 | 2.6250%, 7/31/14 | 14,543,715 | ||||||||
7,666,000 | 2.3750%, 8/31/14 | 7,941,501 | ||||||||
21,014,000 | 2.3750%, 9/30/14 | 21,765,902 | ||||||||
5,110,000 | 2.6250%, 12/31/14 | 5,328,371 | ||||||||
18,362,000 | 2.2500%, 1/31/15 | 18,849,731 | ||||||||
27,093,000 | 2.3750%, 2/28/15 | 27,922,859 | ||||||||
12,771,000 | 2.5000%, 3/31/15 | 13,219,007 | ||||||||
15,516,186 | 0.5000%, 4/15/15ÇÇ | 15,860,459 | ||||||||
16,824,000 | 2.5000%, 4/30/15 | 17,393,122 | ||||||||
37,101,000 | 2.1250%, 5/31/15 | 37,692,390 | ||||||||
1,202,000 | 1.8750%, 6/30/15 | 1,206,789 | ||||||||
14,317,000 | 1.7500%, 7/31/15 | 14,271,186 | ||||||||
2,920,000 | 1.2500%, 9/30/15 | 2,833,083 | ||||||||
1,540,000 | 1.2500%, 10/31/15 | 1,490,430 | ||||||||
5,946,774 | 1.2500%, 7/15/20ÇÇ | 6,088,938 | ||||||||
16,657,000 | 2.6250%, 11/15/20 | 15,712,232 | ||||||||
10,253,000 | 5.2500%, 2/15/29 | 11,758,909 | ||||||||
5,044,000 | 4.3750%, 11/15/39 | 5,070,794 | ||||||||
12,087,000 | 4.6250%, 2/15/40 | 12,661,133 | ||||||||
2,959,000 | 4.3750%, 5/15/40 | 2,973,322 | ||||||||
20,041,000 | 3.8750%, 8/15/40 | 18,459,645 | ||||||||
25,690,000 | 4.2500%, 11/15/40 | 25,272,537 | ||||||||
Total U.S. Treasury Notes/Bonds (cost $861,198,508) | 872,029,142 | |||||||||
Short-Term Taxable Variable Rate Demand Note – 0.3% | ||||||||||
7,275,000 | State of California Build America Bonds – Variable Purpose (cost $7,968,625) | 7,545,194 | ||||||||
Money Market – 0.7% | ||||||||||
23,932,620 | Janus Cash Liquidity Fund LLC, 0% (cost $23,932,620) | 23,932,620 | ||||||||
Total Investments (total cost $3,108,679,395) – 99.4% | 3,176,995,542 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.6% | 17,865,453 | |||||||||
Net Assets – 100% | $ | 3,194,860,995 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Australia | $ | 43,846,968 | 1.4% | |||||
Canada | 60,651,420 | 1.9% | ||||||
Cayman Islands | 25,318,202 | 0.8% | ||||||
Luxembourg | 42,169,286 | 1.3% | ||||||
Mexico | 23,441,155 | 0.7% | ||||||
Switzerland | 15,454,059 | 0.5% | ||||||
United Kingdom | 76,096,119 | 2.4% | ||||||
United States†† | 2,884,014,498 | 90.8% | ||||||
Virgin Islands (British) | 6,003,835 | 0.2% | ||||||
Total | $ | 3,176,995,542 | 100.0% |
†† | Includes Cash Equivalents (90.0% excluding Cash Equivalents). |
See Notes to Schedules of Investments and Financial Statements.
20 | DECEMBER 31, 2010
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Janus Global Bond Fund (unaudited)
Fund Snapshot We believe a bottom-up, fundamentally-driven investment process that focuses on credit can generate risk-adjusted outperformance relative to peers over time. Our comprehensive bottom-up view drives decision-making at a macro level, enabling us to make informed decisions about allocations to all sectors of the fixed income universe. | ![]() Gibson Smith co-portfolio manager | ![]() Darrell Watters co-portfolio manager |
Janus Global Bond Fund began investment operations on December 28, 2010. The information provided for Janus Global Bond Fund reflects investment activity for the period December 28, 2010 to December 31, 2010.
Janus Fixed Income & Money Market Funds | 21
Table of Contents
Janus Global Bond Fund (unaudited)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – estimated for the fiscal year | ||||||
Since | Total Annual Fund | Net Annual Fund | |||||
Inception* | Operating Expenses | Operating Expenses | |||||
Janus Global Bond Fund – Class A Shares | |||||||
NAV | 0.00% | 1.68% | 1.00% | ||||
MOP | –4.76% | ||||||
Janus Global Bond Fund – Class C Shares | |||||||
NAV | 0.00% | 2.45% | 1.75% | ||||
CDSC | –1.00% | ||||||
Janus Global Bond Fund – Class D Shares(1) | 0.00% | 1.47% | 0.90% | ||||
Janus Global Bond Fund – Class I Shares | 0.00% | 1.34% | 0.75% | ||||
Janus Global Bond Fund – Class S Shares | 0.00% | 1.82% | 1.25% | ||||
Janus Global Bond Fund – Class T Shares | 0.00% | 1.57% | 1.00% | ||||
Barclays Capital Global Aggregate Bond Index | 1.50% | ||||||
Barclays Capital Global Aggregate Corporate Bond Index | 1.53% | ||||||
Lipper Quartile – Class T Shares | – | ||||||
Lipper Ranking – based on total returns for Global Income Funds | – | ||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 4.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares and Class S Shares), administrative service fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
See important disclosures on the next page.
22 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Expense information shown reflects estimated annualized expenses that the share classes of the Fund expect to incur during the fiscal year. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
The Fund’s performance may be affected by risks that include those associated with non-investment grade debt securities, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Foreign securities have additional risks including exchange rate changes, political and economic upheaval, the relative lack of information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards. These risks are magnified in emerging markets. The prices of foreign securities held by the Fund, and therefore the Fund’s performance, may decline in response to such risks.
Funds that invest in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the Fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of Fixed Income Funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the Fund and selling of bonds within the Fund by the portfolio managers.
High-yield/high-risk bonds, also known as “junk” bonds, involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value.
This Fund may have significant exposure to emerging markets. In general, emerging market investments have historically been subject to significant gains and/or losses. As such, the Fund’s returns and NAV may be subject to volatility.
Sovereign debt securities are subject to the additional risk that, under some political, diplomatic, social or economic circumstances, some developing countries that issue lower quality debt securities may be unable or unwilling to make principal or interest payments as they come due.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gain or result in losses by offsetting positive returns in other securities the Fund owns.
For a period of three years subsequent to the Fund’s commencement of operations or until the Fund’s assets exceed the first breakpoint in the investment advisory fee schedule, whichever occurs first, Janus Capital may recover from the Fund fees and expenses previously waived or reimbursed if the Fund’s expense ratio, including recovered expenses, falls below the expense limit.
The Fund’s performance for very short time periods may not be indicative of future performance.
Due to certain investment strategies, the Fund may have an increased position in cash.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Lipper does not rank this Fund as it is less than one year old.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The Fund’s inception date – December 28, 2010 | |
(1) | Closed to new investors. |
Janus Fixed Income & Money Market Funds | 23
Table of Contents
Janus Global Bond Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 13.36 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,011.85 | $ | 13.44 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 16.18 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,009.02 | $ | 16.25 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 12.85 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,012.35 | $ | 12.93 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 12.40 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,012.80 | $ | 12.48 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 14.27 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,010.94 | $ | 14.34 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (12/28/10) | (12/31/10) | (12/28/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 13.36 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,011.85 | $ | 13.44 | ||||||||
† | Expenses are equal to the annualized expense ratio of 2.65% for Class A Shares, 3.21% for Class C Shares, 2.55% for Class D Shares, 2.46% for Class I Shares, 2.83% for Class S Shares and 2.65% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. Actual expenses paid reflect only the inception period (December 28, 2010 to December 31, 2010). Therefore, actual expenses shown are lower than would be expected for a six-month period. Actual expenses are equal to the annualized ratio multiplied by the average account value over the period multiplied by 4/365 (to reflect the period); however, hypothetical expenses are multiplied by 184/365 (to reflect a one-half year period). |
24 | DECEMBER 31, 2010
Table of Contents
Janus Global Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Money Market – 100.0% | ||||||||||
10,009,000 | Janus Cash Liquidity Fund LLC, 0% (cost $10,009,000) | $ | 10,009,000 | |||||||
Total Investments (total cost $10,009,000) – 100.0% | 10,009,000 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.0% | 4,243 | |||||||||
Net Assets – 100% | $ | 10,013,243 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
United States†† | $ | 10,009,000 | 100.0% | |||||
Total | $ | 10,009,000 | 100.0% |
†† | Includes Cash Equivalents (0.0% excluding Cash Equivalents). |
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 25
Table of Contents
Janus High-Yield Fund (unaudited)
Fund Snapshot We seek to identify total return opportunities within the high-yield corporate bond market with a focus on companies that are committed to improving their capital structure. We believe a bottom-up, fundamentally-driven investment process that is focused on key credit characteristics can generate risk-adjusted performance relative to our peers over time. Through our comprehensive research process, we seek to invest with conviction in the high-yield markets. | ![]() Gibson Smith co-portfolio manager | ![]() Darrell Watters co-portfolio manager |
Performance Overview
For the six-month period ended December 31, 2010, Janus High-Yield Fund’s Class T Shares returned 11.67%, compared to a 10.15% return of its benchmark, the Barclays Capital U.S. Corporate High-Yield Bond Index.
Economic Update
The U.S. economy continues on the path to recovery, but the path remains cluttered with unpredictable risks and outcomes. While corporate America shows signs of increasing strength, it is being partially offset by factors such as high unemployment and Europe’s sovereign debt problems. Investors are left contemplating the best means to participate in a market that remains highly event-driven and reactive to news flow.
Fears of inflation have put many investors on yellow alert and fueled a more volatile environment for fixed income. An example of this sentiment occurred in the fourth quarter of 2010, when intermediate-to-long dated U.S. Treasuries sold off sharply. The dramatic spike in rates was not a result of economic data indicating a rise in inflation; rather, it was a result of investors concluding that the extension of the Bush tax cuts, more stimulus spending, and quantitative easing by the Federal Reserve (Fed) would drive inflation well beyond previous expectations.
We do not believe that a significant spike in inflation is imminent. We view the economic landscape through individual company and credit analysis, both of which indicate that inflationary pressures remain in check. As the recovery gains momentum, the threat of inflation could be real. We also believe the consensus scenario around an upward trend in rates is likely to play out in the medium term, maintaining pressure in the fixed income markets. But it’s important to keep in mind that there is considerable slack in the employment and goods market, and deflationary pressures are still working their way through the system, mitigating upward price momentum. We will be watching closely for early signs of inflationary pressures and will be attempting to prepare the Fund accordingly.
Though concerns about inflation and rising Treasury rates are timely, the assumption that all fixed income sectors are doomed to negative returns in 2011 oversimplifies the issue. We continue to see considerable opportunity for attractive risk-adjusted returns in high yield credit. We believe there is ample room for spreads to tighten and the additional yield can offset the volatility in underlying interest rates. While the higher yields are attractive, there is additional risk in investing in lower quality companies. Ultimately, the ability to drive returns through individual security selection is crucial to navigating this market.
Perhaps to the surprise of some investors, the frequency of defaults in high yield corporate bonds has trended lower following the 2008 crisis. Following the rampant level of leveraged buyout (LBO) activity in 2007, the market briefly saw a default rate of approximately 12% during the ensuing credit crisis. However, the easy money policy driven by the Fed encouraged banks and bondholders to restructure the terms of the bonds. Modifications included amend & extend agreements, covenant removal and coupon reductions. As a result, default rates are approaching historic lows near 2%. We believe this trend will continue until monetary conditions tighten.
Investors should also remain mindful of the significant maturities facing many corporate borrowers in 2014. Though there is still time for management teams to address the issue, as we move closer to 2014 the market will demand greater risk premiums as this “maturity wall” approaches. We believe this situation offers considerable opportunity for high yield investors, but, as we said, the key will be individual security selection to maximize risk-adjusted return.
While the deleveraging process in corporate America is likely to continue for years, some companies are nearing completion of their balance sheet restructuring. Balance sheets and liquidity are generally stronger, inventories are
26 | DECEMBER 31, 2010
Table of Contents
(unaudited)
under control and many firms have cut costs and made operational improvements. All of this has helped drive profit margins to near 25-year highs. And management teams are gaining confidence in the recovery. Many firms are now looking to improve their margins through capital expenditures or mergers and acquisition – clear signs of an improving outlook. In short, we think high-quality companies will continue benefitting in the recovery. In a post-recession world, companies are demonstrating renewed financial discipline with their balance sheets and greater emphasis on returns on invested capital. This combination of corporate strength and discipline, in our opinion, is a very bullish sign for both long-term credit investors.
Portfolio Overview
Despite trailing peers and benchmark early in the year, the Fund’s strong outperformance during the fourth quarter helped to push it ahead on a relative basis for the six month period. A general aversion to risk dominated sentiment just as the period began, but quickly subsided as investors returned to risk. High yield spreads narrowed amid improving corporate health, better-than-expected economic data and speculation that the Federal Reserve was likely to embark on a second round of quantitative easing (QE2), which it did during the fourth quarter. The Fund’s performance kept pace relatively well during this period.
Overall, the Fund’s outperformance was driven largely by our credit selections. Our non-benchmark exposure to bank loans, which was modestly positive for the period, weighed on comparable returns, while a small position in convertible bonds benefited the Fund. Looking at our sector exposures, the Fund benefited from our automotive and wire-line holdings. Our lack of exposure to life insurers, banks and property and casualty companies held back relative returns. In terms of positioning, we were favoring lower rated credits, overweighting the Fund in B- and CCC-rated names we felt were better quality than suggested by their ratings and their better return profiles.
Contributors to Performance
Visteon Corp., a leading supplier of automotive systems, modules, and components to automotive manufacturers across the globe was a top performer for the period. Having, in our opinion, the best product and customer mix amongst its peers, we also favor Visteon’s dominant market position in Asia relative to other U.S. suppliers. Similarly, Ford Motor Co. had strong results during the period as the U.S. automaker accelerated its progress back to investment grade by paying down debt faster than the street anticipated. We added to our position during a period of weakness in the sector mid-year and benefited from a rally in the credit when Ford achieved a positive cash balance net of debt outstanding at their fiscal year end.
Qwest Communications International, a provider of voice, broadband Internet-based data and image communications was another strong performer for the period. The Fund continued to hold a significant overweight position in the company through year end. We like that Qwest remains committed to paying down debt with its historically strong free cash flow generation. Relative returns also benefited from the acquisition announcement by investment grade rated CenturyTel (now CenturyLink), which caused Qwest bonds to tighten during the period.
Detractors from Performance
Certain strong performing names within the benchmark were either not owned or underweight by the Fund and negatively impacted relative return. In the case of AIG, we were underweight all three components of the firm: AIG’s hybrid securities, ILFC (International Lease Finance Corp.), and American General. In the case of AIG’s hybrid securities, we were uncomfortable with the level of asset coverage earlier in the period believing the bonds offered limited relative value. The U.S. government’s conversion of their credit position to common stock was significant in giving us confidence in the firm’s equity support and reaffirmed bondholders’ position within the capital structure. We like ILFC’s plane leasing business for its historically stable and high free cash flow generation but were underweight during the period on valuation concerns. Lastly, American General was relatively unattractive prior to its purchase by Fortress Investment Group, though we established a position following the acquisition.
Australia-based FMG Resources was a strong market performer and relative detractor as we added the position later in the period and did not capture the full performance of the bonds. The company mines and ships iron ore from Australia benefitting from the continued growth of Chinese steel production. Founded as a green-field mining operation with limited revenue, substantial debt and high capital expenditures, we remained on the sidelines to better assess the fundament strength of the business. FMG has an experienced management team with solid assets in the form of high quality iron ore and appears to be moving forward in its efforts to deleverage their balance sheet.
Janus Fixed Income & Money Market Funds | 27
Table of Contents
Janus High-Yield Fund (unaudited)
Outlook
We have become more optimistic on the U.S. economy overall but remain cognizant of the challenges and valuations within fixed income. With the deleveraging process nearing completion for many companies, balance sheets remain strong and firms are now looking to the next phase with a focus on margin expansion and growth. At the same time we should start to see an increase in shareholder friendly activity in the form of dividend increases and share repurchase programs. These early-stage shareholder friendly activities should not impair balance sheets given their strength, and should be a positive for fixed income investors.
With lackluster labor markets, one might assume that consumer spending would be the last area to recover. But the U.S. consumer remains resilient through the economic uncertainty, tight lending markets and an unemployment rate above 9%. The extension of the Bush tax rates bolstered confidence, and the consumer seems ready to help spur economic growth. In addition, the Fed’s aggressive stimulus programs have been designed to keep liquidity high in the system, rein in higher rates (which is not working) and allow businesses and consumers to refinance higher coupon debt. The programs should help improve overall credit creation. They have also targeted the mortgage market, aimed at encouraging risk-taking and more confidence in the economy. Ideally, strength in consumer-driven sectors will create sufficient momentum to keep the recovery rolling, sparking more hiring and creating a positive feedback loop.
Despite the U.S. consumer’s strength, the economy faces pockets of weakness, particularly in regional manufacturing and housing. The U.S. housing market continued to deteriorate in 2010 with declining investment and falling home prices. We think the large number of foreclosures and the shadow inventory will pressure prices for years. The employment situation also remains challenging with the jobless rate likely to stay elevated well into 2011. Other headwinds include the European sovereign debt problems, elevated fiscal deficits in the U.S. and the large financing needs of the U.S. government.
Inflation remains another area of concern. Pressures are rising in certain segments of the economy and businesses are seeing varying degrees of cost increases. However, inflation has stayed under control at the consumer level, despite meaningfully higher costs in oil and gasoline, as well as most foodstuffs. Core consumer prices are likely to remain tame until the housing market recovers enough to pressure owner’s equivalent rent, a big component of inflation. In addition, a significant improvement in hiring as well as wages would spur more inflation concerns. The dramatic jump in rates in December enforces the argument that the market seems more focused on inflation expectations than fundamental indicators of rising prices. We will be paying close attention to the inputs into the inflation outlook as well as monitoring inflation expectations to help navigate market volatility.
We remain constructive on the opportunities present in high yield, selectively stepping down in the ratings spectrum to lower-rated, potentially higher yielding opportunities only if they fit our stringent criteria for inclusion in the Fund. We will not compromise on quality to “stretch” for yield. We believe that we will continue to operate in very volatile and uncertain markets. In this environment, we will continue to focus on individual credit selection, seeking positions that offer the best risk adjusted returns
Thank you for entrusting your assets to us and for your investment in Janus High-Yield Fund.
28 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Janus High-Yield Fund At A Glance
Fund Profile
December 31, 2010
Weighted Average Maturity | 6.6 Years | |
Average Effective Duration* | 8.5 Years | |
30-day Current Yield** | ||
Class A Shares at NAV | ||
Without Reimbursement | 6.25% | |
With Reimbursement | 6.25% | |
Class A Shares at MOP | ||
Without Reimbursement | 5.95% | |
With Reimbursement | 5.95% | |
Class C Shares*** | ||
Without Reimbursement | 5.41% | |
With Reimbursement | 5.41% | |
Class D Shares | ||
Without Reimbursement | 6.39% | |
With Reimbursement | 6.39% | |
Class I Shares | ||
Without Reimbursement | 6.46% | |
With Reimbursement | 6.46% | |
Class R Shares | ||
Without Reimbursement | 5.79% | |
With Reimbursement | 5.79% | |
Class S Shares | ||
Without Reimbursement | 6.04% | |
With Reimbursement | 6.04% | |
Class T Shares | ||
Without Reimbursement | 6.29% | |
With Reimbursement | 6.29% | |
Number of Bonds/Notes | 247 |
* | A theoretical measure of price volatility | |
** | Yield will fluctuate | |
*** | Does not include the 1.00% contingent deferred sales charge. |
Ratings†Summary – (% of Investment Securities )
December 31, 2010
BBB | 1.7% | |
BB | 27.5% | |
B | 49.3% | |
CCC | 17.4% | |
Other | 4.1% |
† | Rated by Standard & Poor’s |
Significant Areas of Investment – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18b02.gif)
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18p02.gif)
Emerging markets comprised 0.8% of total net assets.
Janus Fixed Income & Money Market Funds | 29
Table of Contents
Janus High-Yield Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18m02.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||||
Fiscal | One | Five | Ten | Since | Total Annual Fund | Net Annual Fund | |||||||||
Year-to-Date | Year | Year | Year | Inception* | Operating Expenses | Operating Expenses | |||||||||
Janus High-Yield Fund – Class A Shares | |||||||||||||||
NAV | 11.64% | 15.66% | 8.06% | 7.49% | 8.10% | 0.92% | 0.92% | ||||||||
MOP | 6.36% | 10.21% | 7.01% | 6.97% | 7.75% | ||||||||||
Janus High-Yield Fund – Class C Shares | |||||||||||||||
NAV | �� | 11.20% | 14.81% | 7.33% | 6.74% | 7.34% | 1.65% | 1.65% | |||||||
CDSC | 10.13% | 13.74% | 7.33% | 6.74% | 7.34% | ||||||||||
Janus High-Yield Fund – Class D Shares(1) | 11.73% | 15.80% | 8.18% | 7.57% | 8.15% | 0.77% | 0.77% | ||||||||
Janus High-Yield Fund – Class I Shares | 11.92% | 15.97% | 8.17% | 7.56% | 8.15% | 0.64% | 0.64% | ||||||||
Janus High-Yield Fund – Class R Shares | 11.38% | 15.15% | 7.57% | 6.99% | 7.60% | 1.37% | 1.37% | ||||||||
Janus High-Yield Fund – Class S Shares | 11.51% | 15.55% | 7.86% | 7.26% | 7.87% | 1.12% | 1.12% | ||||||||
Janus High-Yield Fund – Class T Shares | 11.67% | 15.72% | 8.17% | 7.56% | 8.15% | 0.88% | 0.88% | ||||||||
Barclays Capital U.S. Corporate High-Yield Bond Index | 10.15% | 15.12% | 8.91% | 8.88% | 7.32% | ||||||||||
Lipper Quartile – Class T Shares | – | 1st | 1st | 2nd | 1st | ||||||||||
Lipper Ranking – based on total returns for High Current Yield Funds | – | 92/485 | 44/361 | 101/238 | 7/90 | ||||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 4.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
See important disclosures on the next page.
30 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
For Class D Shares, Class I Shares, Class R Shares, Class S Shares and Class T Shares, a 2% redemption fee may be imposed on shares held for 90 days or less. Performance shown does not reflect this redemption fee and, if reflected, performance would have been lower.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, Class R Shares and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class R Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund’s performance may be affected by risks that include those associated with non-investment grade debt securities, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Funds that invest in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the Fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of Fixed Income Funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the Fund and selling of bonds within the Fund by the portfolio managers.
High-yield/high-risk bonds, also known as “junk” bonds, involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus High-Yield Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class R Shares, and Class S Shares commenced operations on July 6, 2009. Performance shown for each class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010 reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Janus Fixed Income & Money Market Funds | 31
Table of Contents
Janus High-Yield Fund (unaudited)
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return or yield, and therefore the ranking for the period.
December 31, 1995 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The Fund’s inception date – December 29, 1995 | |
(1) | Closed to new investors. |
32 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,116.40 | $ | 5.01 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.47 | $ | 4.79 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,113.30 | $ | 9.06 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,016.64 | $ | 8.64 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,117.30 | $ | 4.22 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.22 | $ | 4.02 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,119.20 | $ | 3.63 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.78 | $ | 3.47 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class R Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,113.80 | $ | 7.46 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.15 | $ | 7.12 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,115.10 | $ | 6.13 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.41 | $ | 5.85 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,116.70 | $ | 4.80 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.67 | $ | 4.58 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.94% for Class A Shares, 1.70% for Class C Shares, 0.79% for Class D Shares, 0.68% for Class I Shares, 1.40% for Class R Shares, 1.15% for Class S Shares and 0.90% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Fixed Income & Money Market Funds | 33
Table of Contents
Janus High-Yield Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Bank Loans – 3.9% | ||||||||||
Advertising Services – 0.1% | ||||||||||
$1,789,515 | Visant Corp. 7.0000%, 9/22/16‡ | $ | 1,809,200 | |||||||
Automotive – Cars and Light Trucks – 0.6% | ||||||||||
9,014,452 | Ford Motor Co. 3.1000%, 12/16/13‡ | 8,994,079 | ||||||||
Building Products – Air and Heating – 0.3% | ||||||||||
1,488,270 | Goodman Global, Inc. 5.7500%, 10/6/16‡ | 1,494,089 | ||||||||
3,283,000 | Goodman Global, Inc. 9.0000%, 10/6/17‡ | 3,378,765 | ||||||||
4,872,854 | ||||||||||
Casino Hotels – 0.2% | ||||||||||
3,740,000 | Harrah’s Entertainment, Inc., 3.2884%, 1/28/15‡ | 3,374,415 | ||||||||
Electric – Integrated – 0.3% | ||||||||||
7,096,649 | Texas Competitive Electric Holdings LLC 3.7638%, 10/10/14‡ | 5,472,510 | ||||||||
Finance – Consumer Loans – 0.2% | ||||||||||
2,890,000 | AGFS Funding Co. 7.2500%, 4/8/15‡ | 2,930,865 | ||||||||
Food – Retail – 0.1% | ||||||||||
1,504,000 | Great Atlantic & Pacific Tea Co. 8.7500%, 6/13/12‡ | 1,515,280 | ||||||||
Medical – Drugs – 0% | ||||||||||
740,664 | Warner Chilcott, Ltd. 6.5000%, 1/29/16‡ | 747,026 | ||||||||
Medical – Outpatient and Home Medical Care – 0.3% | ||||||||||
4,830,000 | Res-Care, Inc. 7.2500%, 11/23/16‡ | 4,733,400 | ||||||||
Retail – Apparel and Shoe – 0.5% | ||||||||||
4,546,933 | Burlington Coat Factory 2.5200%, 5/28/13‡ | 4,465,452 | ||||||||
2,980,000 | Gymboree Corp. 5.5000%, 10/23/17‡ | 2,993,500 | ||||||||
7,458,952 | ||||||||||
Retail – Pet Food and Supplies – 0.2% | ||||||||||
2,987,000 | Petco Animal Supplies, Inc. 6.0000%, 12/31/49‡ | 2,984,521 | ||||||||
Retail – Regional Department Stores – 0.4% | ||||||||||
5,966,859 | Neiman Marcus Group, Inc. 4.3034%, 4/6/16‡ | 5,902,536 | ||||||||
Retail – Restaurants – 0.3% | ||||||||||
2,409,000 | Burger King Corp. 6.2500%, 9/7/16‡ | 2,443,497 | ||||||||
2,980,000 | Dunkin Brands, Inc. 5.7500%, 10/25/17‡ | 3,013,942 | ||||||||
5,457,439 | ||||||||||
Special Purpose Entity – 0.4% | ||||||||||
5,562,310 | Fox Acquisition LLC, 7.5000%, 7/14/15‡ | 5,515,030 | ||||||||
Total Bank Loans (cost $58,802,480) | 61,768,107 | |||||||||
Common Stock – 3.3% | ||||||||||
Auction House – Art Dealer – 0.3% | ||||||||||
307,655 | KAR Auction Services, Inc.* | 4,245,639 | ||||||||
Automotive – Cars and Light Trucks – 1.0% | ||||||||||
1,007,311 | Ford Motor Co.* | 16,912,752 | ||||||||
Automotive – Truck Parts and Equipment – Original – 1.1% | ||||||||||
16,119 | Visteon Corp.* | 1,196,836 | ||||||||
221,223 | Visteon Corp.*,(144A)§,°° | 15,933,033 | ||||||||
17,129,869 | ||||||||||
Telephone – Integrated – 0.9% | ||||||||||
1,974,715 | Qwest Communications International, Inc. | 15,027,581 | ||||||||
Total Common Stock (cost $39,218,146) | 53,315,841 | |||||||||
Corporate Bonds – 85.3% | ||||||||||
Advertising Agencies – 0.2% | ||||||||||
$2,970,000 | Interpublic Group of Companies, Inc. 10.0000%, 7/15/17 | 3,474,900 | ||||||||
Advertising Services – 0.6% | ||||||||||
2,367,000 | Checkout Holding Corp. 0%, 11/15/15 (144A) | 1,476,416 | ||||||||
7,573,000 | Visant Corp. 10.0000%, 10/1/17 (144A) | 8,046,313 | ||||||||
9,522,729 | ||||||||||
Aerospace and Defense – 0.3% | ||||||||||
4,145,000 | Spirit AeroSystems Holdings, Inc. 6.7500%, 12/15/20 (144A) | 4,155,363 | ||||||||
Aerospace and Defense – Equipment – 1.9% | ||||||||||
29,689,000 | TransDigm Inc. 7.7500%, 12/15/18 (144A) | 30,728,115 | ||||||||
Agricultural Chemicals – 1.0% | ||||||||||
6,852,000 | CF Industries, Inc. 6.8750%, 5/1/18 | 7,331,640 | ||||||||
3,564,000 | CF Industries, Inc. 7.1250%, 5/1/20 | 3,902,580 | ||||||||
4,075,000 | Phibro Animal Health Corp. 9.2500%, 7/1/18 (144A) | 4,197,250 | ||||||||
15,431,470 | ||||||||||
Airlines – 0.7% | ||||||||||
1,066,000 | Delta Air Lines, Inc. 9.5000%, 9/15/14 (144A) | 1,160,607 | ||||||||
4,752,000 | United Air Lines, Inc. 9.8750%, 8/1/13 (144A) | 5,120,280 | ||||||||
4,158,000 | United Air Lines, Inc. 12.0000%, 11/1/13 (144A) | 4,584,195 | ||||||||
10,865,082 | ||||||||||
Apparel Manufacturers – 1.5% | ||||||||||
6,474,000 | Levi Strauss & Co. 8.8750%, 4/1/16 | 6,830,070 | ||||||||
5,940,000 | Levi Strauss & Co. 7.6250%, 5/15/20 | 6,133,050 | ||||||||
11,045,000 | Quiksilver, Inc. 6.8750%, 4/15/15 | 10,796,487 | ||||||||
23,759,607 | ||||||||||
Auction House – Art Dealer – 0% | ||||||||||
71,000 | Kar Auction Services, Inc. 10.0000%, 5/1/15 | 75,260 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
34 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Automotive – Cars and Light Trucks – 1.6% | ||||||||||
$23,106,000 | Ford Motor Co. 7.4500%, 7/16/31** | $ | 24,752,302 | |||||||
Automotive – Truck Parts and Equipment – Original – 1.4% | ||||||||||
2,970,000 | Accuride Corp. 9.5000%, 8/1/18 (144A) | 3,215,025 | ||||||||
11,583,000 | American Axle & Manufacturing Holdings, Inc. 9.2500%, 1/15/17 (144A) | 12,944,002 | ||||||||
1,782,000 | Arvinmeritor, Inc. 8.1250%, 9/15/15 | 1,864,418 | ||||||||
4,455,000 | Tenneco, Inc. 7.7500%, 8/15/18 (144A) | 4,722,300 | ||||||||
22,745,745 | ||||||||||
Beverages – Wine and Spirits – 0.1% | ||||||||||
1,175,000 | Constellation Brands, Inc. 8.3750%, 12/15/14 | 1,283,688 | ||||||||
Broadcast Services and Programming – 0.2% | ||||||||||
3,020,000 | XM Satellite Radio, Inc. 7.6250%, 11/1/18 (144A) | 3,118,150 | ||||||||
Building – Residential and Commercial – 1.5% | ||||||||||
5,940,000 | Lennar Corp. 5.6000%, 5/31/15 | 5,732,100 | ||||||||
7,155,000 | M/I Homes, Inc. 8.6250%, 11/15/18 (144A) | 7,226,550 | ||||||||
5,940,000 | Meritage Homes Corp. 6.2500%, 3/15/15 | 5,969,700 | ||||||||
4,752,000 | Standard Pacific Corp. 10.7500%, 9/15/16 | 5,476,680 | ||||||||
24,405,030 | ||||||||||
Building and Construction – Miscellaneous – 0.3% | ||||||||||
4,752,000 | American Residential Services LLC 12.0000%, 4/15/15 (144A) | 4,965,840 | ||||||||
Building and Construction Products – Miscellaneous – 0.9% | ||||||||||
2,970,000 | Ply Gem Industries, Inc. 11.7500%, 6/15/13 | 3,177,900 | ||||||||
9,504,000 | Ply Gem Industries, Inc. 13.1250%, 7/15/14 | 10,098,000 | ||||||||
1,780,000 | USG Corp. 8.3750%, 10/15/18 (144A) | 1,744,400 | ||||||||
15,020,300 | ||||||||||
Building Products – Wood – 0.3% | ||||||||||
4,963,000 | Boise Cascade LLC 7.1250%, 10/15/14 | 4,851,333 | ||||||||
Cable Television – 1.2% | ||||||||||
9,504,000 | Block Communications, Inc. 8.2500%, 12/15/15 (144A) | 9,575,280 | ||||||||
4,453,000 | CCO Holdings LLC / CCO Holdings Capital Corp. 7.2500%, 10/30/17 (144A) | 4,519,795 | ||||||||
594,000 | CCO Holdings LLC / CCO Holdings Capital Corp. 7.8750%, 4/30/18 (144A) | 614,790 | ||||||||
3,564,000 | Mediacom LLC / Mediacom Capital Corp. 9.1250%, 8/15/19 | 3,635,280 | ||||||||
18,345,145 | ||||||||||
Casino Hotels – 5.0% | ||||||||||
8,615,000 | Ameristar Casinos, Inc. 9.2500%, 6/1/14 | 9,218,050 | ||||||||
3,564,000 | Boyd Gaming Corp. 6.7500%, 4/15/14 | 3,501,630 | ||||||||
2,376,000 | Harrah’s Operating Co., Inc. 11.2500%, 6/1/17 | 2,673,000 | ||||||||
1,782,000 | Harrah’s Operating Co., Inc. 12.7500%, 4/15/18 (144A) | 1,790,910 | ||||||||
21,143,000 | Harrah’s Operating Co., Inc. 10.0000%, 12/15/18 | 19,292,987 | ||||||||
4,289,000 | MGM Mirage 10.3750%, 5/15/14 | 4,814,403 | ||||||||
8,016,000 | MGM Mirage 4.2500%, 4/15/15 (144A) | 8,777,520 | ||||||||
8,374,000 | MGM Mirage 7.5000%, 6/1/16 | 7,829,690 | ||||||||
4,132,000 | MGM Mirage 11.1250%, 11/15/17 | 4,751,800 | ||||||||
3,267,000 | MGM Mirage 11.3750%, 3/1/18 (144A) | 3,544,695 | ||||||||
5,940,000 | MGM Mirage 9.0000%, 3/15/20 (144A) | 6,534,000 | ||||||||
6,534,000 | Wynn Las Vegas LLC / Wynn Las Vegas Capital Corp. 7.7500%, 8/15/20 | 7,073,055 | ||||||||
79,801,740 | ||||||||||
Casino Services – 0.3% | ||||||||||
3,446,000 | International Game Technology 3.2500%, 5/1/14 | 4,001,668 | ||||||||
Cellular Telecommunications – 1.1% | ||||||||||
4,455,000 | Sprint Nextel Corp. 6.0000%, 12/1/16 | 4,304,644 | ||||||||
11,434,000 | Sprint Nextel Corp. 8.3750%, 8/15/17 | 12,262,965 | ||||||||
1,204,000 | Syniverse Holdings, Inc. 9.1250%, 1/15/19 (144A) | 1,243,130 | ||||||||
17,810,739 | ||||||||||
Chemicals – Diversified – 1.1% | ||||||||||
11,227,000 | LBI Escrow Corp. 8.0000%, 11/1/17 (144A) | 12,419,869 | ||||||||
4,775,000 | Momentive Performance Materials, Inc. 9.0000%, 1/15/21 (144A) | 5,037,625 | ||||||||
17,457,494 | ||||||||||
Chemicals – Specialty – 0.9% | ||||||||||
5,676,000 | Ashland, Inc. 9.1250%, 6/1/17 | 6,541,590 | ||||||||
7,177,000 | Vertellus Specialties, Inc. 9.3750%, 10/1/15 (144A) | 7,607,620 | ||||||||
14,149,210 | ||||||||||
Commercial Banks – 3.0% | ||||||||||
15,147,000 | CIT Group, Inc. 7.0000%, 5/1/13** | 15,449,940 | ||||||||
6,831,000 | CIT Group, Inc. 7.0000%, 5/1/15** | 6,848,078 | ||||||||
24,825,000 | CIT Group, Inc. 7.0000%, 5/1/17** | 24,887,062 | ||||||||
47,185,080 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 35
Table of Contents
Janus High-Yield Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Commercial Services – 0.3% | ||||||||||
$4,146,000 | Iron Mountain, Inc. 8.3750%, 8/15/21 | $ | 4,446,585 | |||||||
Commercial Services – Finance – 0.8% | ||||||||||
11,880,000 | Cardtronics, Inc. 8.2500%, 9/1/18 | 12,652,200 | ||||||||
Consumer Products – Miscellaneous – 1.3% | ||||||||||
2,376,000 | Jarden Corp. 8.0000%, 5/1/16 | 2,586,870 | ||||||||
4,306,000 | Jarden Corp. 7.5000%, 5/1/17 | 4,537,447 | ||||||||
5,720,000 | Reynolds Group Issuer, Inc. 7.1250%, 4/15/19 (144A) | 5,820,100 | ||||||||
3,011,000 | Reynolds Group Issuer, Inc. 9.0000%, 4/15/19 (144A) | 3,120,149 | ||||||||
4,169,000 | Viking Acquisition, Inc. 9.2500%, 11/1/18 (144A) | 4,137,733 | ||||||||
20,202,299 | ||||||||||
Containers – Metal and Glass – 0.8% | ||||||||||
4,816,000 | Ardagh Packaging Finance PLC 7.3750%, 10/15/17 (144A) | 4,966,500 | ||||||||
8,126,000 | Ardagh Packaging Finance PLC 9.1250%, 10/15/20 (144A) | 8,451,040 | ||||||||
13,417,540 | ||||||||||
Containers – Paper and Plastic – 0.6% | ||||||||||
3,500,000 | Graham Packaging Company L.P. / GPC Capital Corp. 8.2500%, 10/1/18 | 3,675,000 | ||||||||
5,825,000 | Graphic Packaging International, Inc. 7.8750%, 10/1/18 | 6,101,687 | ||||||||
9,776,687 | ||||||||||
Cruise Lines – 0.2% | ||||||||||
3,855,000 | NCL Corporation Ltd. 9.5000%, 11/15/18 (144A) | 3,970,650 | ||||||||
Data Processing and Management – 2.5% | ||||||||||
1,392,000 | First Data Corp. 9.8750%, 9/24/15 | 1,325,880 | ||||||||
12,598,000 | First Data Corp. 11.2500%, 3/31/16** | 11,023,250 | ||||||||
1,782,000 | First Data Corp. 8.8750%, 8/15/20 (144A) | 1,880,010 | ||||||||
12,541,000 | First Data Corp. 8.2500%, 1/15/21 (144A) | 12,039,360 | ||||||||
12,541,000 | First Data Corp. 12.6250%, 1/15/21 (144A) | 11,976,655 | ||||||||
1,412,230 | First Data Corp. (PIK) 10.5500%, 9/24/15 | 1,338,088 | ||||||||
39,583,243 | ||||||||||
Direct Marketing – 1.1% | ||||||||||
9,632,000 | Affinion Group Holdings, Inc. 11.6250%, 11/15/15 (144A) | 9,993,200 | ||||||||
6,528,000 | Affinion Group, Inc. 11.5000%, 10/15/15 | 6,789,120 | ||||||||
16,782,320 | ||||||||||
Distribution/Wholesale – 0.5% | ||||||||||
3,772,000 | Ace Hardware Corp. 9.1250%, 6/1/16 (144A) | 4,036,040 | ||||||||
4,752,000 | McJunkin Red Man, Corp. 9.5000%, 12/15/16 (144A) | 4,490,640 | ||||||||
8,526,680 | ||||||||||
Diversified Banking Institutions – 1.9% | ||||||||||
12,177,000 | Ally Financial, Inc. 7.5000%, 9/15/20 (144A) | 12,770,629 | ||||||||
15,444,000 | GMAC, Inc. 8.0000%, 11/1/31 | 16,640,910 | ||||||||
29,411,539 | ||||||||||
Diversified Financial Services – 0.6% | ||||||||||
9,917,000 | OPTI Canada, Inc. 9.0000%, 12/15/12 (144A) | 9,969,362 | ||||||||
Diversified Minerals – 1.0% | ||||||||||
15,013,000 | FMG Resources August 2006 Pty, Ltd. 7.0000%, 11/1/15 (144A) | 15,388,325 | ||||||||
Diversified Operations – Commercial Services – 0.4% | ||||||||||
6,326,000 | ARAMARK Corp. 8.5000%, 2/1/15 | 6,610,670 | ||||||||
Electric – Generation – 0.8% | ||||||||||
2,376,000 | AES Corp. 9.7500%, 4/15/16 | 2,655,180 | ||||||||
9,261,000 | AES Corp. 8.0000%, 10/15/17 | 9,793,507 | ||||||||
12,448,687 | ||||||||||
Electric – Integrated – 0.4% | ||||||||||
5,940,000 | Calpine Construction Finance Co., L.P. 8.0000%, 6/1/16 (144A) | 6,311,250 | ||||||||
Electronic Components – Semiconductors – 1.1% | ||||||||||
9,398,000 | Advanced Micro Devices, Inc. 8.1250%, 12/15/17 | 9,961,880 | ||||||||
6,534,000 | STATS ChipPAC, Ltd. 7.5000%, 8/12/15 (144A) | 7,040,385 | ||||||||
17,002,265 | ||||||||||
Engineering – Research and Development Services – 0.2% | ||||||||||
3,623,000 | Abengoa Finance SAU 8.8750%, 11/1/17 (144A) | 3,351,275 | ||||||||
Engines – Internal Combustion – 0.3% | ||||||||||
4,213,000 | Briggs & Stratton Corp. 6.8750%, 12/15/20 | 4,297,260 | ||||||||
Finance – Auto Loans – 1.2% | ||||||||||
5,643,000 | Ford Motor Credit Co. LLC 8.0000%, 6/1/14 | 6,216,932 | ||||||||
2,376,000 | Ford Motor Credit Co. LLC 8.7000%, 10/1/14 | 2,675,749 | ||||||||
8,910,000 | Ford Motor Credit Co. LLC 8.1250%, 1/15/20 | 10,366,010 | ||||||||
19,258,691 | ||||||||||
Finance – Consumer Loans – 0.6% | ||||||||||
11,610,000 | American General Finance Corp. 6.9000%, 12/15/17 | 9,375,075 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
36 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Finance – Leasing Companies – 0.7% | ||||||||||
$10,098,000 | International Lease Finance Corp. 8.7500%, 3/15/17 (144A) | $ | 10,830,105 | |||||||
Finance – Other Services – 0.7% | ||||||||||
5,930,000 | Icahn Enterprises L.P. / Icahn Enterprises Finance Corp. 8.0000%, 1/15/18 (144A) | 5,900,350 | ||||||||
5,940,000 | Icahn Enterprises L.P. / Icahn Enterprises Finance Corp. 8.0000%, 1/15/18 | 5,940,000 | ||||||||
11,840,350 | ||||||||||
Food – Canned – 0.2% | ||||||||||
2,970,000 | TreeHouse Foods, Inc. 7.7500%, 3/1/18 | 3,218,738 | ||||||||
Food – Dairy Products – 0.2% | ||||||||||
2,995,000 | Dean Foods Co. 9.7500%, 12/15/18 (144A) | 3,017,463 | ||||||||
Food – Meat Products – 0.6% | ||||||||||
1,668,000 | JBS USA LLC / JBS USA Finance, Inc. 11.6250%, 5/1/14 | 1,951,560 | ||||||||
5,940,000 | Smithfield Foods, Inc. 10.0000%, 7/15/14 (144A) | 6,845,850 | ||||||||
8,797,410 | ||||||||||
Food – Miscellaneous/Diversified – 1.3% | ||||||||||
2,376,000 | Del Monte Corp. 7.5000%, 10/15/19 | 2,771,010 | ||||||||
5,272,000 | Dole Food Co., Inc. 8.7500%, 7/15/13 | 5,634,450 | ||||||||
5,536,000 | Dole Food Co., Inc. 13.8750%, 3/15/14** | 6,759,511 | ||||||||
5,049,000 | Dole Food Co., Inc. 8.0000%, 10/1/16 (144A) | 5,326,695 | ||||||||
20,491,666 | ||||||||||
Food – Retail – 0.4% | ||||||||||
3,148,000 | Stater Brothers Holdings, Inc. 7.7500%, 4/15/15 | 3,234,570 | ||||||||
2,367,000 | Stater Brothers Holdings, Inc. 7.3750%, 11/15/18 (144A) | 2,426,175 | ||||||||
5,660,745 | ||||||||||
Gambling – Non-Hotel – 0.6% | ||||||||||
5,696,000 | Jacobs Entertainment, Inc. 9.7500%, 6/15/14 | 5,539,360 | ||||||||
1,782,000 | Pinnacle Entertainment, Inc. 8.6250%, 8/1/17 | 1,942,380 | ||||||||
1,702,000 | Pokagon Gaming Authority 10.3750%, 6/15/14 (144A) | 1,774,335 | ||||||||
9,256,075 | ||||||||||
Home Furnishings – 0.3% | ||||||||||
5,049,000 | Norcraft Companies L.P. / Norcraft Finance Corp. 10.5000%, 12/15/15 | 5,364,563 | ||||||||
Hotels and Motels – 0.2% | ||||||||||
2,200,000 | Starwood Hotels & Resorts Worldwide, Inc. 6.7500%, 5/15/18 | 2,409,000 | ||||||||
Independent Power Producer – 1.2% | ||||||||||
6,237,000 | Calpine Corp. 7.8750%, 7/31/20 (144A) | 6,314,963 | ||||||||
6,237,000 | NRG Energy, Inc. 7.3750%, 1/15/17 | 6,424,110 | ||||||||
6,237,000 | NRG Energy, Inc. 8.5000%, 6/15/19 | 6,439,702 | ||||||||
19,178,775 | ||||||||||
Investment Management and Advisory Services – 0.3% | ||||||||||
4,466,000 | Pinafore LLC / Pinafore, Inc. 9.0000%, 10/1/18 (144A) | 4,823,280 | ||||||||
Machine Tools and Related Products – 0.2% | ||||||||||
2,968,000 | Thermadyne Holdings Corp. 9.0000%, 12/15/17 (144A) | 3,060,750 | ||||||||
Machinery – Farm – 0.1% | ||||||||||
1,782,000 | Case New Holland, Inc. 7.8750%, 12/1/17 (144A) | 1,946,835 | ||||||||
Medical – Drugs – 0.2% | ||||||||||
595,000 | Endo Pharmaceuticals Holdings, Inc. 7.0000%, 12/15/20 (144A) | 606,900 | ||||||||
2,975,000 | Valeant Pharmaceuticals International, Inc. 6.8750%, 12/1/18 (144A) | 2,952,688 | ||||||||
3,559,588 | ||||||||||
Medical – Hospitals – 2.3% | ||||||||||
4,439,000 | HCA Holdings, Inc. 7.7500%, 5/15/21 (144A) | 4,439,000 | ||||||||
6,130,000 | HCA, Inc. 9.2500%, 11/15/16 | 6,539,944 | ||||||||
15,741,000 | HCA, Inc. 7.2500%, 9/15/20 | 16,449,345 | ||||||||
5,292,000 | IASIS Healthcare 8.7500%, 6/15/14 | 5,430,915 | ||||||||
3,200,000 | UHS Escrow Corp. 7.0000%, 10/1/18 (144A) | 3,280,000 | ||||||||
36,139,204 | ||||||||||
Medical – Outpatient and Home Medical Care – 0% | ||||||||||
602,000 | Res-Care, Inc. 10.7500%, 1/15/19 (144A) | 620,060 | ||||||||
Medical Labs and Testing Services – 0.3% | ||||||||||
4,213,000 | Aurora Diagnostics Holdings / Aurora Diagnostics Financing, Inc. 10.7500%, 1/15/18 (144A) | 4,223,533 | ||||||||
Motion Pictures and Services – 0.4% | ||||||||||
5,346,000 | Lions Gate Entertainment, Inc. 10.2500%, 11/1/16 (144A) | 5,573,205 | ||||||||
Music – 0.3% | ||||||||||
4,036,000 | WMG Acquisition Corp. 9.5000%, 6/15/16 | 4,328,610 | ||||||||
Office Furnishings – Original – 0.4% | ||||||||||
5,434,000 | Interface, Inc. 7.6250%, 12/1/18 (144A) | 5,610,605 | ||||||||
Office Supplies and Forms – 0.4% | ||||||||||
5,346,000 | ACCO Brands Corp. 10.6250%, 3/15/15 | 6,014,250 | ||||||||
Oil – Field Services – 0.1% | ||||||||||
1,480,000 | Calfrac Holdings L.P. 7.5000%, 12/1/20 (144A) | 1,498,500 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 37
Table of Contents
Janus High-Yield Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Oil Companies – Exploration and Production – 2.5% | ||||||||||
$2,925,000 | Chaparral Energy, Inc. 9.8750%, 10/1/20 (144A) | $ | 3,085,875 | |||||||
3,267,000 | Chesapeake Energy Corp. 6.8750%, 11/15/20 | 3,307,837 | ||||||||
4,752,000 | Continental Resources, Inc. 8.2500%, 10/1/19 | 5,274,720 | ||||||||
2,970,000 | Continental Resources, Inc. 7.1250%, 4/1/21 (144A) | 3,118,500 | ||||||||
4,186,000 | Harvest Operations Corp. 6.8750%, 10/1/17 (144A) | 4,311,580 | ||||||||
1,188,000 | Hilcorp Energy L.P. / Hilcorp Finance Co. 9.0000%, 6/1/16 (144A) | 1,256,310 | ||||||||
3,017,000 | Hilcorp Energy L.P. / Hilcorp Finance Co. 7.6250%, 4/15/21 (144A) | 3,115,052 | ||||||||
4,752,000 | Linn Energy LLC / Linn Energy Finance Corp. 7.7500%, 2/1/21 (144A) | 4,870,800 | ||||||||
2,673,000 | OPTI Canada, Inc. 8.2500%, 12/15/14 | 1,904,513 | ||||||||
2,970,000 | Petrohawk Energy Corp. 7.2500%, 8/15/18 | 2,999,700 | ||||||||
5,346,000 | SandRidge Energy, Inc. 9.8750%, 5/15/16 (144A) | 5,653,395 | ||||||||
1,191,000 | Whiting Petroleum Corp. 6.5000%, 10/1/18 | 1,202,910 | ||||||||
40,101,192 | ||||||||||
Oil Field Machinery and Equipment – 0.2% | ||||||||||
2,588,000 | Dresser-Rand Group, Inc. 7.3750%, 11/1/14 | 2,652,700 | ||||||||
Oil Refining and Marketing – 0.3% | ||||||||||
2,554,000 | Frontier Oil Corp. 8.5000%, 9/15/16 | 2,720,010 | ||||||||
2,367,000 | Frontier Oil Corp. 6.8750%, 11/15/18 | 2,414,340 | ||||||||
5,134,350 | ||||||||||
Paper and Related Products – 0.9% | ||||||||||
5,938,000 | ABI Escrow Corp. 10.2500%, 10/15/18 (144A) | 6,502,110 | ||||||||
7,662,000 | Verso Paper Holdings LLC 11.3750%, 8/1/16 | 7,681,155 | ||||||||
14,183,265 | ||||||||||
Pipelines – 1.4% | ||||||||||
12,295,000 | Crosstex Energy L.P. / Crosstex Energy Finance Corp. 8.8750%, 2/15/18 | 13,171,019 | ||||||||
6,017,000 | El Paso Corp. 6.5000%, 9/15/20 (144A) | 6,057,939 | ||||||||
3,624,000 | Regency Energy Partners L.P. / Regency Energy Finance Corp. 6.8750%, 12/1/18 | 3,669,300 | ||||||||
22,898,258 | ||||||||||
Poultry – 0.2% | ||||||||||
2,995,000 | Pilgrim’s Pride Corp. 7.8750%, 12/15/18 (144A) | 2,980,025 | ||||||||
Printing – Commercial – 1.1% | ||||||||||
12,336,000 | American Reprographics Co. 10.5000%, 12/15/16 (144A) | 12,921,960 | ||||||||
5,346,000 | Cenveo Corp. 8.8750%, 2/1/18 | 5,172,255 | ||||||||
18,094,215 | ||||||||||
Publishing – Books – 1.1% | ||||||||||
3,801,000 | Cengage Learning Acquisitions, Inc. 10.5000%, 1/15/15 (144A) | 3,924,532 | ||||||||
12,474,000 | Cengage Learning Acquisitions, Inc. 13.2500%, 7/15/15 (144A) | 13,160,070 | ||||||||
17,084,602 | ||||||||||
Publishing – Newspapers – 0.2% | ||||||||||
3,588,000 | Gannett Co., Inc. 6.3750%, 9/1/15 (144A) | 3,614,910 | ||||||||
Publishing – Periodicals – 0.7% | ||||||||||
2,970,000 | Nielson Finance Co. LLC 11.5000%, 5/1/16 | 3,430,350 | ||||||||
7,220,000 | Nielson Finance Co. LLC 7.7500%, 10/15/18 (144A) | 7,472,700 | ||||||||
10,903,050 | ||||||||||
Radio – 0.9% | ||||||||||
2,384,000 | Citadel Broadcasting Corp. 7.7500%, 12/15/18 (144A) | 2,467,440 | ||||||||
10,228,000 | Sirius XM Radio, Inc. 8.7500%, 4/1/15 (144A) | 11,071,810 | ||||||||
13,539,250 | ||||||||||
REIT – Health Care – 0.1% | ||||||||||
1,188,000 | Senior Housing Properties Trust 6.7500%, 4/15/20 | 1,254,825 | ||||||||
REIT – Office Property – 1.1% | ||||||||||
15,625,000 | Reckson Operating Partnership L.P. 7.7500%, 3/15/20 | 16,718,750 | ||||||||
REIT – Warehouse and Industrial – 0% | ||||||||||
523,000 | ProLogis 6.8750%, 3/15/20 | 555,282 | ||||||||
Rental Auto/Equipment – 0.5% | ||||||||||
3,267,000 | Avis Budget Car Rental LLC / Avis Budget Finance, Inc. 7.7500%, 5/15/16 | 3,332,340 | ||||||||
1,150,000 | Avis Budget Car Rental LLC / Avis Budget Finance, Inc. 9.6250%, 3/15/18 | 1,239,125 | ||||||||
3,844,000 | Hertz Corp. 7.5000%, 10/15/18 (144A) | 3,988,150 | ||||||||
8,559,615 | ||||||||||
Retail – Apparel and Shoe – 1.2% | ||||||||||
11,048,000 | Burlington Coat Factory Warehouse Corp. 11.1250%, 4/15/14 | 11,407,060 | ||||||||
6,710,000 | Phillips-Van Heusen Corp. 7.3750%, 5/15/20 | 7,129,375 | ||||||||
18,536,435 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
38 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Retail – Arts and Crafts – 1.1% | ||||||||||
$8,613,000 | Michael’s Stores, Inc. 11.3750%, 11/1/16 | $ | 9,388,170 | |||||||
7,530,000 | Michaels Stores, Inc. 7.7500%, 11/1/18 (144A) | 7,511,175 | ||||||||
16,899,345 | ||||||||||
Retail – Computer Equipment – 0.2% | ||||||||||
3,746,000 | GameStop Corp. 8.0000%, 10/1/12 | 3,830,285 | ||||||||
Retail – Leisure Products – 0.5% | ||||||||||
8,209,000 | Steinway Musical Instruments 7.0000%, 3/1/14 (144A) | 8,270,567 | ||||||||
Retail – Mail Order – 0.2% | ||||||||||
2,970,000 | QVC, Inc. 7.5000%, 10/1/19 (144A) | 3,125,925 | ||||||||
Retail – Major Department Stores – 0.1% | ||||||||||
2,481,000 | JC Penney Co., Inc. 5.6500%, 6/1/20 | 2,375,558 | ||||||||
Retail – Pet Food and Supplies – 0.3% | ||||||||||
4,162,000 | Petco Animal Supplies, Inc. 9.2500%, 12/1/18 (144A) | 4,385,708 | ||||||||
Retail – Propane Distribution – 1.2% | ||||||||||
1,782,000 | Ferrellgas L.P. / Ferrellgas Finance Corp. 9.1250%, 10/1/17 | 1,960,200 | ||||||||
7,210,000 | Ferrellgas Partners L.P. / Ferrellgas Partners Finance Corp. 8.6250%, 6/15/20 | 7,750,750 | ||||||||
8,750,000 | Inergy L.P. / Inergy Finance Corp. 7.0000%, 10/1/18 (144A) | 8,815,625 | ||||||||
18,526,575 | ||||||||||
Retail – Regional Department Stores – 0.7% | ||||||||||
5,049,000 | Macy’s Retail Holdings, Inc. 7.4500%, 7/15/17 | 5,553,900 | ||||||||
5,346,000 | Neiman Marcus Group, Inc. 10.3750%, 10/15/15 | 5,646,712 | ||||||||
11,200,612 | ||||||||||
Retail – Restaurants – 1.7% | ||||||||||
3,011,000 | DineEquity, Inc. 9.5000%, 10/30/18 (144A) | 3,191,660 | ||||||||
7,994,000 | Dunkin Finance Corp. 9.6250%, 12/1/18 (144A) | 8,073,940 | ||||||||
1,806,000 | Landry’s Restaurants, Inc. 11.6250%, 12/1/15 (144A) | 1,927,905 | ||||||||
5,940,000 | Landry’s Restaurants, Inc. 11.6250%, 12/1/15 | 6,340,950 | ||||||||
7,238,000 | OSI Restaurant Partners, Inc. 10.0000%, 6/15/15 | 7,527,520 | ||||||||
27,061,975 | ||||||||||
Retail – Toy Store – 0.2% | ||||||||||
2,970,000 | Toys R Us Property Co., LLC 8.5000%, 12/1/17 | 3,192,750 | ||||||||
Rubber – Tires – 0.6% | ||||||||||
1,782,000 | Goodyear Tire & Rubber Co. 10.5000%, 5/15/16 | 2,031,480 | ||||||||
6,534,000 | Goodyear Tire & Rubber Co. 8.2500%, 8/15/20 | 6,762,690 | ||||||||
8,794,170 | ||||||||||
Satellite Telecommunications – 0.8% | ||||||||||
2,350,000 | Intelsat Jackson Holdings S.A. 7.2500%, 10/15/20 (144A) | 2,373,500 | ||||||||
8,167,000 | Intelsat Jackson Holdings, Ltd. 11.2500%, 6/15/16 | 8,799,942 | ||||||||
1,782,000 | Intelsat Subsidiary Holding Co., Ltd. 8.8750%, 1/15/15 (144A) | 1,822,095 | ||||||||
12,995,537 | ||||||||||
Security Services – 0.5% | ||||||||||
7,128,000 | Garda World Security Corp. 9.7500%, 3/15/17 (144A) | 7,644,780 | ||||||||
Seismic Data Collection – 0.1% | ||||||||||
1,782,000 | Cie Generale de Geophysique-Veritas 9.5000%, 5/15/16 | 1,942,380 | ||||||||
Special Purpose Entity – 2.5% | ||||||||||
10,402,000 | CCM Merger, Inc. 8.0000%, 8/1/13 (144A) | 10,115,945 | ||||||||
14,986,000 | KAR Auction Services, Inc. 8.7500%, 5/1/14 | 15,585,440 | ||||||||
4,455,000 | Landry’s Holdings, Inc. 11.5000%, 6/1/14 (144A)** | 4,365,900 | ||||||||
10,295,000 | Petroplus Finance, Ltd. 7.0000%, 5/1/17 (144A) | 9,111,075 | ||||||||
39,178,360 | ||||||||||
Telecommunication Services – 1.0% | ||||||||||
7,800,000 | Clearwire Communications LLC 12.0000%, 12/1/15 (144A) | 8,404,500 | ||||||||
5,346,000 | Qwest Corp. 8.3750%, 5/1/16 | 6,335,010 | ||||||||
1,188,000 | Qwest Corp. 6.8750%, 9/15/33 | 1,167,210 | ||||||||
15,906,720 | ||||||||||
Telephone – Integrated – 4.4% | ||||||||||
4,752,000 | Frontier Communications Corp. 8.2500%, 5/1/14 | 5,262,840 | ||||||||
2,970,000 | Frontier Communications Corp. 8.1250%, 10/1/18 | 3,259,575 | ||||||||
4,625,000 | Frontier Communications Corp. 8.5000%, 4/15/20 | 5,052,813 | ||||||||
8,019,000 | Level 3 Financing, Inc. 10.0000%, 2/1/18 | 7,698,240 | ||||||||
2,376,000 | Qwest Capital Funding, Inc. 6.8750%, 7/15/28 | 2,221,560 | ||||||||
891,000 | Qwest Capital Funding, Inc. 7.7500%, 2/15/31 | 899,910 | ||||||||
15,805,000 | Qwest Communications International, Inc. 7.1250%, 4/1/18 (144A) | 16,358,175 | ||||||||
6,629,000 | Virgin Media Finance PLC 9.1250%, 8/15/16 | 7,059,885 | ||||||||
6,534,000 | Virgin Media Finance PLC 9.5000%, 8/15/16 | 7,383,420 | ||||||||
4,158,000 | Virgin Media Finance PLC 8.3750%, 10/15/19 | 4,542,615 | ||||||||
6,831,000 | Windstream Corp. 8.6250%, 8/1/16 | 7,189,627 | ||||||||
2,690,000 | Windstream Corp. 7.7500%, 10/15/20 | 2,770,700 | ||||||||
69,699,360 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 39
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Janus High-Yield Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Television – 0.5% | ||||||||||
$2,415,000 | Univision Communications, Inc. 7.8750%, 11/1/20 (144A) | $ | 2,535,750 | |||||||
5,919,000 | Univision Communications, Inc. 8.5000%, 5/15/21 (144A) | 5,992,987 | ||||||||
8,528,737 | ||||||||||
Therapeutics – 0.2% | ||||||||||
2,970,000 | Warner Chilcott Co. LLC / Warner Chilcott Finance LLC 7.7500%, 9/15/18 (144A) | 2,999,700 | ||||||||
Transportation – Air Freight – 0.4% | ||||||||||
6,541,000 | AMGH Merger Sub, Inc. 9.2500%, 11/1/18 (144A) | 6,868,050 | ||||||||
Transportation – Marine – 0.8% | ||||||||||
4,158,000 | Navios Maritime Holdings, Inc. 8.8750%, 11/1/17 | 4,501,035 | ||||||||
7,253,000 | Ship Finance International, Ltd. 8.5000%, 12/15/13 | 7,379,927 | ||||||||
594,000 | Teekay Corp. 8.5000%, 1/15/20 | 646,718 | ||||||||
12,527,680 | ||||||||||
Transportation – Railroad – 1.0% | ||||||||||
3,267,000 | Kansas City Southern de Mexico S.A. de C.V. 7.3750%, 6/1/14 | 3,414,015 | ||||||||
2,540,000 | Kansas City Southern de Mexico S.A. de C.V. 8.0000%, 2/1/18 | 2,749,550 | ||||||||
7,127,000 | Kansas City Southern de Mexico S.A. de C.V. 6.6250%, 12/15/20 (144A) | 7,144,817 | ||||||||
1,290,000 | Kansas City Southern Railway 13.0000%, 12/15/13 | 1,535,100 | ||||||||
1,455,000 | Kansas City Southern Railway 8.0000%, 6/1/15 | 1,564,125 | ||||||||
16,407,607 | ||||||||||
Transportation – Services – 0.3% | ||||||||||
4,783,000 | CHC Helicopter S.A. 9.2500%, 10/15/20 (144A) | 4,950,405 | ||||||||
Transportation – Truck – 0.5% | ||||||||||
7,823,000 | Swift Services Holdings, Inc. 10.0000%, 11/15/18 (144A) | 8,194,593 | ||||||||
Total Corporate Bonds (cost $1,256,494,545) | 1,350,470,006 | |||||||||
Preferred Stock – 0.5% | ||||||||||
Diversified Banking Institutions – 0.2% | ||||||||||
140,525 | Citigroup Capital, 0% | 3,781,528 | ||||||||
Special Purpose Entity – 0.3% | ||||||||||
361,215 | Dole Food Automatic Exchange, 7.0000%§ | 4,616,761 | ||||||||
Total Preferred Stock (cost $8,028,313) | 8,398,289 | |||||||||
Warrant – 0.3% | ||||||||||
Casino Services – 0.3% | ||||||||||
65,326 | Pokertek, Inc. – expires 4/23/12* (cost $3,304,842) | 4,400,359 | ||||||||
Money Market – 4.9% | ||||||||||
76,903,466 | Janus Cash Liquidity Fund LLC, 0% (cost $76,903,466) | 76,903,466 | ||||||||
Total Investments (total cost $1,442,751,792) – 98.2% | 1,555,256,068 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 1.8% | 28,122,142 | |||||||||
Net Assets – 100% | $ | 1,583,378,210 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Australia | $ | 15,388,325 | 1.0% | |||||
Bermuda | 22,283,747 | 1.4% | ||||||
Canada | 28,780,640 | 1.8% | ||||||
France | 1,942,380 | 0.1% | ||||||
Ireland | 16,417,240 | 1.1% | ||||||
Luxembourg | 11,173,442 | 0.7% | ||||||
Marshall Islands | 5,147,753 | 0.3% | ||||||
Mexico | 13,308,382 | 0.9% | ||||||
Singapore | 7,040,385 | 0.5% | ||||||
Spain | 3,351,275 | 0.2% | ||||||
United Kingdom | 18,985,920 | 1.2% | ||||||
United States†† | 1,411,436,579 | 90.8% | ||||||
Total | $ | 1,555,256,068 | 100.0% |
†† | Includes Cash Equivalents (85.8% excluding Cash Equivalents). |
See Notes to Schedules of Investments and Financial Statements.
40 | DECEMBER 31, 2010
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Janus Short-Term Bond Fund (unaudited)
Fund Snapshot We believe a bottom-up, fundamentally-driven investment process that focuses on credit-oriented investments can generate risk-adjusted performance relative to our peers over time. Our comprehensive bottom-up view drives decision-making at a macro level, enabling us to make informed decisions about overall portfolio allocations. | ![]() Gibson Smith co-portfolio manager | ![]() Darrell Watters co-portfolio manager |
Performance Overview
For the six-month period ended December 31, 2010, Janus Short-Term Bond Fund’s Class T Shares returned 1.53%, compared to a 0.83% return of its benchmark, the Barclays Capital 1-3 Year U.S. Government Credit Index.
Market Environment
The U.S. economy continues on the path to recovery, but the path remains cluttered with unpredictable risks and outcomes. While corporate America shows signs of increasing strength, it is being partially offset by factors such as high unemployment and Europe’s sovereign debt problems. Investors are left contemplating the best means to participate in a market that remains highly event-driven and reactive to news flow.
Fears of inflation have put many investors on yellow alert and fueled a more volatile environment for fixed income. An example of this sentiment occurred in the fourth quarter of 2010, when intermediate-to-long dated U.S. Treasuries sold off sharply. The dramatic spike in rates was not a result of economic data indicating a rise in inflation; rather, it was a result of investors concluding that the extension of the Bush tax cuts, more stimulus spending, and quantitative easing by the Federal Reserve (Fed) would drive inflation well beyond previous expectations.
We do not believe that a significant spike in inflation is imminent. We view the economic landscape through individual company and credit analysis, both of which indicate that inflationary pressures remain in check. As the recovery gains momentum, the threat of inflation could be real. We also believe the consensus scenario around an upward trend in rates is likely to play out in the medium term, maintaining pressure in the fixed income markets. But it’s important to keep in mind that there is considerable slack in the employment and goods market, and deflationary pressures are still working their way through the system, mitigating upward price momentum. We will be watching closely for early signs of inflationary pressures and will be attempting to prepare the Fund accordingly.
In light of the market’s focus on inflation expectations, investors may begin to see notable divergences in the risk/reward profiles of fixed income. Fortunately, we have the flexibility to allocate into areas where we think the risk/reward profile is more attractive. Though concerns about rising Treasury rates are timely, we do not believe all fixed income sectors are doomed to negative returns in 2011. For example, we continue to see considerable opportunity in corporate credits. In the investment grade arena, we believe there is ample room for spreads to tighten. In addition, the added yield associated with owning credit can offset some of the volatility in underlying interest rates. We also feel short duration, high yield corporate debt offers opportunities. (Duration measures a bond’s sensitivity to changes in interest rates). There is additional return potential in lower quality debt and we are selectively stepping down the quality spectrum where corporate strength is evident. This enforces our emphasis on credit selection, which we think is critical to driving returns in this volatile and uncertain market.
Overall, the fundamentals for many companies have improved, making us more positive on the opportunities ahead. While corporate deleveraging is likely to continue for years, some companies are nearing completion of their balance sheet restructuring and again enforces the value of individual credit selection. Balance sheets and liquidity are generally stronger, inventories are under control and many firms have cut costs and made operational improvements. All of this has helped drive profit margins to near 25-year highs. And management teams are gaining confidence in the recovery. Many firms are now looking to improve their margins through capital expenditures or mergers and acquisition – clear signs of an improving outlook.
In short, we think high-quality companies will continue benefitting in the recovery. In a post-recession world, companies are demonstrating renewed financial discipline with their balance sheets and more emphasis on returns
Janus Fixed Income & Money Market Funds | 41
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Janus Short-Term Bond Fund (unaudited)
to investors. This combination of corporate strength and discipline, in our opinion, is a very bullish sign for long-term credit investors.
At times, the Fund may own various types of derivative instruments. Please see the Derivative Instruments section in the “Notes to Financial Statements” for a discussion of derivatives used by the Fund.
Contributors to Performance
Our top individual contributor, Ford Motor Company had strong results during the period as the U.S. automaker accelerated its progress back to investment grade by paying down debt faster than the street anticipated. We added to our position during a period of weakness in the sector mid-year and benefited from a rally in the credit when Ford achieved a positive cash balance net of debt outstanding at their fiscal year end.
Smithfield Foods performed very well late in the period due to management’s focus on aggressively reducing debt through strong cash flow and asset sales. During the credit crisis, this company was significantly over levered, almost collapsing the business, and management is strongly motivated to avoid a similar situation in the future. Smithfield is benefitting from improving demand trends for protein and a balanced supply, which is allowing for better pricing.
Detractors from Performance
Asciano Financial Limited, an Australia-based company is engaged in the ownership and management of ports and rail assets and other operations and services. The company is benefitting from the growth in demand of industrial commodities in Asia. Though management specifies paying down debt as a primary objective for the firm, the bonds were weaker during the period due to concerns around the floods in Australia. We believe the market is overestimating the impact of the floods to Asciano’s business given the relatively small percentage of their rails actually affected and the diversification of their business.
Our credit holding in Spanish bank Banco Santander suffered from concerns over its potential exposure to the European sovereign debt crisis, particularly operations in Spain. Santander generates the majority of its operational income outside of Spain, which we believe is misunderstood by the market. Given the bank’s global footprint and improving credit profile we continue to see value in the position.
Outlook
We have become more optimistic on the U.S. economy overall but remain cognizant of the challenges and valuations within fixed income. With the deleveraging process nearing completion for many companies, balance sheets remain strong and firms are now looking to facilitate margin expansion and growth. At the same time we should start to see an increase in shareholder friendly activity in the form of dividend increases and share repurchase programs. These early-stage shareholder friendly activities should not impair balance sheets given their strength, and should be a positive for fixed income investors. At this point in the U.S. recovery, costs have been cut, operational improvements have been made and inventories are under control.
With lackluster labor markets, one might assume that consumer spending would be the last area to recover. But the U.S. consumer remains resilient through the economic uncertainty, tight lending markets and an unemployment rate above 9%. The extension of the Bush tax rates appeared to bolstered confidence, and the consumer seems ready to help spur economic growth. In addition, the Fed’s aggressive stimulus programs have been designed to keep liquidity high in the system, rein in higher rates (which is not working) and allow businesses and consumers to refinance higher coupon debt. The programs should help improve overall credit creation. They have also targeted the mortgage market, aimed at encouraging risk-taking and more confidence in the economy. Ideally, strength in consumer-driven sectors will create sufficient momentum to keep the recovery rolling, sparking more hiring and creating a positive feedback loop.
Despite the U.S. consumer’s strength, the economy continues to face pockets of weakness, particularly in regional manufacturing and housing. The U.S. housing market continued to deteriorate in 2010 with declining investment and falling home prices. We think the large number of foreclosures and the shadow inventory will pressure prices for years. The employment situation also remains challenging with the jobless rate likely to stay elevated well into 2011. Other headwinds include the European sovereign debt problems, elevated fiscal deficits in the U.S. and the large financing needs of the U.S. government.
Inflation remains another area of concern. Pressures are rising in certain segments of the economy and businesses are seeing varying degrees of cost increases. However, inflation has stayed under control at the consumer level, despite meaningfully higher costs in oil and gasoline, as
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(unaudited)
well as most foodstuffs. Core consumer prices are likely to remain tame until the housing market recovers enough to pressure owner’s equivalent rent, a big component of inflation. In addition, a significant improvement in hiring as well as wages would spur more inflation concerns. The dramatic jump in rates in December enforces the argument that the market seems more focused on inflation expectations than fundamental indicators of rising prices. We will be paying close attention to the inputs into the inflation outlook as well as monitoring inflation expectations to help navigate market volatility.
In terms of positioning, we remain overweight corporate credit, selectively stepping down in the ratings spectrum to lower-rated, potentially higher yielding opportunities only if they fit our stringent criteria for inclusion in the Fund. We will not compromise on quality to “stretch” for yield. We maintained a zero weight to agencies at the end of the period as we saw limited value in the sector relative to Treasuries. Lastly, we maintained a modest weight in Treasuries to insure against a fear driven flight to safety through period end.
Given the high levels of market volatility and economic uncertainty, we believe that individual security selection will be the most important driver of returns for bond investors. As always, we will continue to focus on opportunities that offer the best risk-adjusted returns.
Thank you for entrusting your assets to us and your investment in Janus Short-Term Bond Fund.
Janus Fixed Income & Money Market Funds | 43
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Janus Short-Term Bond Fund (unaudited)
Janus Short-Term Bond Fund At A Glance
Fund Profile
December 31, 2010
Weighted Average Maturity | 2.2 Years | |
Average Effective Duration* | 1.8 Years | |
30-day Current Yield** | ||
Class A Shares at NAV | ||
Without Reimbursement | 1.02% | |
With Reimbursement | 1.33% | |
Class A Shares at MOP | ||
Without Reimbursement | 0.99% | |
With Reimbursement | 1.30% | |
Class C Shares*** | ||
Without Reimbursement | 0.25% | |
With Reimbursement | 0.59% | |
Class D Shares | ||
Without Reimbursement | 1.32% | |
With Reimbursement | 1.46% | |
Class I Shares | ||
Without Reimbursement | 1.30% | |
With Reimbursement | 1.58% | |
Class S Shares | ||
Without Reimbursement | 0.99% | |
With Reimbursement | 1.09% | |
Class T Shares | ||
Without Reimbursement | 1.24% | |
With Reimbursement | 1.34% | |
Number of Bonds/Notes | 252 |
* | A theoretical measure of price volatility | |
** | Yield will fluctuate | |
*** | Does not include the 1.00% contingent deferred sales charge. |
Ratings†Summary – (% of Net Assets)
December 31, 2010
AAA | 21.8% | |
AA | 10.9% | |
A | 20.8% | |
BBB | 27.6% | |
BB | 13.2% | |
B | 3.1% | |
Other | 2.6% |
† | Rated by Standard & Poor’s |
Significant Areas of Investment – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18b04.gif)
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18p04.gif)
* Includes Cash and Cash Equivalents of (0.7)%
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(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif18m04.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||||
Fiscal | One | Five | Ten | Since | Total Annual Fund | Net Annual Fund | |||||||||
Year-to-Date | Year | Year | Year | Inception* | Operating Expenses | Operating Expenses | |||||||||
Janus Short-Term Bond Fund – Class A Shares | |||||||||||||||
NAV | 1.53% | 3.70% | 4.90% | 3.98% | 4.40% | 0.84% | 0.80% | ||||||||
MOP | –1.03% | –1.14% | 3.89% | 3.47% | 4.13% | ||||||||||
Janus Short-Term Bond Fund – Class C Shares | |||||||||||||||
NAV | 1.15% | 2.60% | 4.28% | 3.33% | 3.72% | 1.59% | 1.55% | ||||||||
CDSC | 0.15% | 1.60% | 4.28% | 3.33% | 3.72% | ||||||||||
Janus Short-Term Bond Fund – Class D Shares(1) | 1.60% | 3.48% | 5.20% | 4.37% | 4.83% | 0.74% | 0.67% | ||||||||
Janus Short-Term Bond Fund – Class I Shares | 1.67% | 3.96% | 5.07% | 4.18% | 4.63% | 0.59% | 0.55% | ||||||||
Janus Short-Term Bond Fund – Class S Shares | 1.40% | 3.11% | 4.60% | 3.75% | 4.21% | 1.09% | 1.05% | ||||||||
Janus Short-Term Bond Fund – Class T Shares | 1.53% | 3.37% | 5.18% | 4.36% | 4.82% | 0.84% | 0.80% | ||||||||
Barclays Capital 1-3 Year U.S. Government/Credit Index | 0.83% | 2.80% | 4.53% | 4.34% | 4.98%** | ||||||||||
Lipper Quartile – Class T Shares | – | 3rd | 1st | 1st | 1st | ||||||||||
Lipper Ranking – based on total returns for Short Investment Grade Debt Funds | – | 150/250 | 13/170 | 17/97 | 6/25 | ||||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
See important disclosures on the next page.
Janus Fixed Income & Money Market Funds | 45
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Janus Short-Term Bond Fund (unaudited)
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 2.50%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund’s performance may be affected by risks that include those associated with non-investment grade debt securities, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
Funds that invest in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the Fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of Fixed Income Funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the Fund and selling of bonds within the Fund by the portfolio managers.
High-yield/high-risk bonds, also known as “junk” bonds, involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gains or result in losses by offsetting positive returns in other securities the Fund owns.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, Janus Short-Term Bond Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares of the Fund commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010 reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s
46 | DECEMBER 31, 2010
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(unaudited)
commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return or yield, and therefore the ranking for the period.
September 3, 1992 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
Effective July 1, 2010, Gibson Smith is a co-portfolio manager of Janus Short-Term Bond Fund.
* | The Fund’s inception date – September 1, 1992 | |
** | The Barclays Capital 1-3 Year U.S. Government/Credit Index’s since inception returns are calculated from August 31, 1992. | |
(1) | Closed to new investors. |
Janus Fixed Income & Money Market Funds | 47
Table of Contents
Janus Short-Term Bond Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,015.30 | $ | 4.06 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.17 | $ | 4.08 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,011.50 | $ | 7.86 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.39 | $ | 7.88 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,016.00 | $ | 3.46 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.78 | $ | 3.47 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,016.70 | $ | 2.80 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.43 | $ | 2.80 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,014.00 | $ | 5.33 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.91 | $ | 5.35 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,015.30 | $ | 4.06 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.17 | $ | 4.08 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.80% for Class A Shares, 1.55% for Class C Shares, 0.68% for Class D Shares, 0.55% for Class I Shares, 1.05% for Class S Shares and 0.80% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
48 | DECEMBER 31, 2010
Table of Contents
Janus Short-Term Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Bank Loans – 2.9% | ||||||||||
Advertising Sales – 0.4% | ||||||||||
$10,263,354 | Lamar Advertising Co. 3.0000%, 12/30/16‡ | $ | 10,330,682 | |||||||
Aerospace and Defense – 0.5% | ||||||||||
12,455,000 | TransDigm Group, Inc. 3.5000%, 12/6/16‡ | 12,566,721 | ||||||||
Automotive – Cars and Light Trucks – 0.7% | ||||||||||
19,763,824 | Ford Motor Co. 2.7500%, 12/15/13‡ | 19,719,158 | ||||||||
Medical – Hospitals – 0.9% | ||||||||||
23,262,000 | HCA, Inc. 1.2500%, 11/16/12‡ | 22,958,663 | ||||||||
Radio – 0.1% | ||||||||||
3,645,000 | Citadel Broadcasting Corp. 3.2500%, 12/30/16‡ | 3,656,409 | ||||||||
Retail – Apparel and Shoe – 0.3% | ||||||||||
6,513,872 | Phillips-Van Heusen Corp. 3.0000%, 5/6/16‡ | 6,593,667 | ||||||||
Total Bank Loans (cost $74,927,741) | 75,825,300 | |||||||||
Corporate Bonds – 75.6% | ||||||||||
Advertising Services – 0.1% | ||||||||||
1,687,000 | WPP Finance UK 5.8750%, 6/15/14 | 1,822,680 | ||||||||
Aerospace and Defense – 0.1% | ||||||||||
1,456,000 | Northrop Grumman Systems Corp. 7.1250%, 2/15/11 | 1,466,202 | ||||||||
Airlines – 0.7% | ||||||||||
8,403,000 | Southwest Airlines Co. 6.5000%, 3/1/12 | 8,797,958 | ||||||||
9,636,000 | Southwest Airlines Co. 5.2500%, 10/1/14 | 10,134,538 | ||||||||
18,932,496 | ||||||||||
Automotive – Cars and Light Trucks – 0.9% | ||||||||||
9,100,000 | Daimler Finance North America LLC 5.7500%, 9/8/11 | 9,402,857 | ||||||||
14,951,000 | Volkswagen International Finance N.V. 1.6250%, 8/12/13 (144A) | 14,943,330 | ||||||||
24,346,187 | ||||||||||
Beverages – Wine and Spirits – 0.1% | ||||||||||
2,730,000 | Diageo Capital PLC 3.8750%, 4/1/11 | 2,751,436 | ||||||||
Brewery – 1.6% | ||||||||||
9,100,000 | Anheuser-Busch InBev Worldwide, Inc. 3.0000%, 10/15/12 | 9,389,489 | ||||||||
20,929,000 | Anheuser-Busch InBev Worldwide, Inc. 2.5000%, 3/26/13 | 21,416,771 | ||||||||
7,280,000 | Anheuser-Busch InBev Worldwide, Inc. 7.2000%, 1/15/14 (144A) | 8,325,372 | ||||||||
3,750,000 | SABMiller PLC 6.2000%, 7/1/11 (144A) | 3,846,761 | ||||||||
42,978,393 | ||||||||||
Broadcast Services and Programming – 0.4% | ||||||||||
10,920,000 | Discovery Communications LLC 3.7000%, 6/1/15 | 11,305,880 | ||||||||
Building Products – Cement and Aggregate – 0.8% | ||||||||||
1,726,000 | CRH America, Inc. 5.6250%, 9/30/11 | 1,780,421 | ||||||||
5,488,000 | CRH America, Inc. 5.3000%, 10/15/13 | 5,889,123 | ||||||||
13,679,000 | CRH America, Inc. 4.1250%, 1/15/16 | 13,591,591 | ||||||||
21,261,135 | ||||||||||
Cable Television – 0.3% | ||||||||||
710,000 | COX Communications, Inc. 6.7500%, 3/15/11 | 718,541 | ||||||||
1,365,000 | COX Communications, Inc. 7.1250%, 10/1/12 | 1,497,024 | ||||||||
1,274,000 | CSC Holdings, Inc. 7.6250%, 4/1/11 | 1,289,925 | ||||||||
3,185,000 | Time Warner Cable, Inc. 5.4000%, 7/2/12 | 3,381,295 | ||||||||
1,092,000 | Time Warner Cable, Inc. 6.2000%, 7/1/13 | 1,212,810 | ||||||||
8,099,595 | ||||||||||
Cellular Telecommunications – 0.4% | ||||||||||
2,730,000 | Cellco Partnership / Verizon Wireless Capital LLC 3.7500%, 5/20/11 | 2,763,467 | ||||||||
1,037,000 | Cellco Partnership / Verizon Wireless Capital LLC 5.2500%, 2/1/12 | 1,085,385 | ||||||||
1,683,000 | Cellco Partnership / Verizon Wireless Capital LLC 7.3750%, 11/15/13 | 1,949,855 | ||||||||
1,729,000 | Cellco Partnership / Verizon Wireless Capital LLC 5.5500%, 2/1/14 | 1,906,579 | ||||||||
2,779,000 | Rogers Communications, Inc. 7.8750%, 5/1/12 | 3,018,914 | ||||||||
10,724,200 | ||||||||||
Chemicals – Diversified – 1.0% | ||||||||||
2,730,000 | Dow Chemical Co. 4.8500%, 8/15/12 | 2,877,909 | ||||||||
2,794,000 | Dow Chemical Co. 7.6000%, 5/15/14 | 3,222,566 | ||||||||
9,100,000 | Dow Chemical Co. 2.5000%, 2/15/16 | 8,740,095 | ||||||||
4,795,000 | Nova Chemicals Corp. 6.5000%, 1/15/12 | 4,974,812 | ||||||||
7,128,000 | Rohm & Hass Co. 5.6000%, 3/15/13 | 7,621,172 | ||||||||
27,436,554 | ||||||||||
Commercial Banks – 7.7% | ||||||||||
14,286,000 | American Express Bank FSB 5.5500%, 10/17/12 | 15,280,563 | ||||||||
15,233,000 | ANZ National Int’l, Ltd. 2.3750%, 12/21/12 (144A) | 15,468,030 | ||||||||
13,649,000 | Banco Santander Chile 1.3028%, 9/22/11 (144A)‡ | 13,643,800 | ||||||||
8,190,000 | BB&T Corp. 6.5000%, 8/1/11 | 8,453,210 |
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 49
Table of Contents
Janus Short-Term Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
$18,199,000 | Canadian Imperial Bank of Commerce/Canada 1.4500%, 9/13/13 | $ | 18,139,216 | |||||||
4,550,000 | Commonwealth Bank of Australia 2.7500%, 10/15/12 (144A) | 4,668,118 | ||||||||
3,881,000 | Credit Suisse New York 5.5000%, 5/1/14 | 4,256,106 | ||||||||
25,934,000 | HSBC Bank PLC 1.6250%, 8/12/13 (144A) | 25,972,642 | ||||||||
16,097,000 | National Australia Bank 2.5000%, 1/8/13 (144A) | 16,403,036 | ||||||||
3,499,000 | National Australia Bank 5.3500%, 6/12/13 (144A) | 3,789,791 | ||||||||
3,831,000 | National City Bank of Kentucky 6.3000%, 2/15/11 | 3,853,725 | ||||||||
6,379,000 | National City Bank/Cleveland OH 6.2000%, 12/15/11 | 6,687,010 | ||||||||
18,199,000 | Nordea Bank A.B. 1.7500%, 10/4/13 (144A) | 18,109,152 | ||||||||
16,572,000 | Royal Bank of Scotland PLC 3.4000%, 8/23/13 | 16,740,322 | ||||||||
10,182,000 | Svenska Handelsbanken A.B. 2.8750%, 9/14/12 (144A) | 10,428,985 | ||||||||
1,627,000 | U.S. Bank N.A. 6.3750%, 8/1/11 | 1,681,088 | ||||||||
9,100,000 | Westpac Banking Corp. 2.2500%, 11/19/12 | 9,310,756 | ||||||||
10,920,000 | Westpac Banking Corp. 0.8397%, 4/8/13 (144A)‡ | 10,946,863 | ||||||||
203,832,413 | ||||||||||
Computers – Memory Devices – 0.8% | ||||||||||
11,820,000 | Seagate Technology 6.3750%, 10/1/11 | 12,130,275 | ||||||||
7,826,000 | Seagate Technology 10.0000%, 5/1/14 (144A) | 9,175,985 | ||||||||
21,306,260 | ||||||||||
Containers – Paper and Plastic – 0.2% | ||||||||||
5,190,000 | Temple-Inland, Inc. 7.8750%, 5/1/12 | 5,552,381 | ||||||||
Cosmetics and Toiletries – 0.5% | ||||||||||
13,649,000 | Procter & Gamble International 1.3500%, 8/26/11 | 13,754,821 | ||||||||
Data Processing and Management – 0.4% | ||||||||||
849,000 | Fiserv, Inc. 6.1250%, 11/20/12 | 918,174 | ||||||||
8,947,000 | Fiserv, Inc. 3.1250%, 10/1/15 | 8,859,158 | ||||||||
9,777,332 | ||||||||||
Diversified Banking Institutions – 6.6% | ||||||||||
9,100,000 | Bank of America Corp. 3.7000%, 9/1/15 | 9,021,421 | ||||||||
3,640,000 | Citigroup, Inc. 5.2500%, 2/27/12 | 3,794,070 | ||||||||
6,750,000 | Citigroup, Inc. 5.6250%, 8/27/12 | 7,083,140 | ||||||||
8,827,000 | Citigroup, Inc. 5.3000%, 10/17/12 | 9,348,155 | ||||||||
15,014,000 | Citigroup, Inc. 5.5000%, 4/11/13 | 15,987,358 | ||||||||
5,915,000 | Citigroup, Inc. 5.0000%, 9/15/14 | 6,118,937 | ||||||||
11,443,000 | Citigroup, Inc. 4.7500%, 5/19/15 | 11,981,931 | ||||||||
18,199,000 | Goldman Sachs Group, Inc. 3.6250%, 8/1/12 | 18,781,459 | ||||||||
2,935,000 | Goldman Sachs Group, Inc. 3.7000%, 8/1/15 | 2,990,507 | ||||||||
819,000 | JPMorgan Chase & Co. 6.7500%, 2/1/11 | 822,609 | ||||||||
2,548,000 | JPMorgan Chase & Co. 5.3750%, 10/1/12 | 2,734,035 | ||||||||
6,750,000 | JPMorgan Chase & Co. 4.8750%, 3/15/14 | 7,183,620 | ||||||||
2,457,000 | Morgan Stanley 5.0500%, 1/21/11 | 2,461,560 | ||||||||
3,094,000 | Morgan Stanley 6.7500%, 4/15/11 | 3,145,617 | ||||||||
18,579,000 | Morgan Stanley 5.3000%, 3/1/13 | 19,798,117 | ||||||||
11,375,000 | Morgan Stanley 2.7856%, 5/14/13‡ | 11,787,662 | ||||||||
6,370,000 | Morgan Stanley 6.7500%, 10/15/13 | 6,944,676 | ||||||||
4,930,000 | Morgan Stanley 3.4500%, 11/2/15 | 4,806,533 | ||||||||
27,470,000 | UBS AG/Stamford CT 2.2500%, 8/12/13 | 27,704,429 | ||||||||
172,495,836 | ||||||||||
Diversified Financial Services – 2.4% | ||||||||||
3,822,000 | American Express Travel Related Services Co., Inc. 5.2500%, 11/21/11 (144A) | 3,944,445 | ||||||||
8,190,000 | General Electric Capital Corp. 6.1250%, 2/22/11 | 8,250,008 | ||||||||
16,038,000 | General Electric Capital Corp. 2.8000%, 1/8/13 | 16,395,680 | ||||||||
4,550,000 | General Electric Capital Corp. 5.4500%, 1/15/13 | 4,893,066 | ||||||||
26,389,000 | General Electric Capital Corp. 1.8750%, 9/16/13 | 26,403,118 | ||||||||
3,535,000 | General Electric Capital Corp. 5.9000%, 5/13/14 | 3,912,393 | ||||||||
63,798,710 | ||||||||||
Diversified Minerals – 0.8% | ||||||||||
10,920,000 | Anglo American Capital PLC 2.1500%, 9/27/13 (144A) | 11,013,890 | ||||||||
6,479,000 | Teck Resources, Ltd. 7.0000%, 9/15/12 | 6,890,579 | ||||||||
2,376,000 | Teck Resources, Ltd. 10.2500%, 5/15/16 | 2,940,300 | ||||||||
20,844,769 | ||||||||||
Diversified Operations – 0.6% | ||||||||||
1,365,000 | Dover Corp. 6.5000%, 2/15/11 | 1,374,238 | ||||||||
992,000 | Eaton Corp. 4.9000%, 5/15/13 | 1,070,056 | ||||||||
11,513,000 | Tyco Electronics Group S.A. 6.0000%, 10/1/12 | 12,378,398 | ||||||||
14,822,692 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
50 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Electric – Distribution – 0.2% | ||||||||||
$5,505,000 | SP Powerassets, Ltd. 5.0000%, 10/22/13 (144A) | $ | 5,971,053 | |||||||
Electric – Generation – 0.8% | ||||||||||
18,409,000 | Allegheny Energy Supply Co. LLC 8.2500%, 4/15/12 (144A) | 19,750,758 | ||||||||
Electric – Integrated – 1.0% | ||||||||||
1,078,000 | CMS Energy Corp. 8.5000%, 4/15/11 | 1,098,827 | ||||||||
7,760,000 | CMS Energy Corp. 6.3000%, 2/1/12 | 8,231,032 | ||||||||
1,501,000 | Duke Energy Corp. 6.3000%, 2/1/14 | 1,671,881 | ||||||||
910,000 | Georgia Power Co. 6.0000%, 11/1/13 | 1,017,488 | ||||||||
1,365,000 | Monongahela Power Co. 7.9500%, 12/15/13 (144A) | 1,577,197 | ||||||||
910,000 | Nevada Power Co. 8.2500%, 6/1/11 | 937,486 | ||||||||
4,550,000 | NiSource, Inc. 5.4000%, 7/15/14 | 4,989,703 | ||||||||
710,000 | Oncor Electric Delivery Co. 5.9500%, 9/1/13 | 786,149 | ||||||||
4,550,000 | Union Electric Co. 4.6500%, 10/1/13 | 4,864,018 | ||||||||
910,000 | Wisconsin Energy Corp. 6.5000%, 4/1/11 | 923,149 | ||||||||
26,096,930 | ||||||||||
Electronic Components – Semiconductors – 0.6% | ||||||||||
9,391,000 | Advanced Micro Devices, Inc. 5.7500%, 8/15/12 | 9,625,775 | ||||||||
6,156,000 | National Semiconductor Corp. 6.1500%, 6/15/12 | 6,550,606 | ||||||||
16,176,381 | ||||||||||
Electronic Measuring Instruments – 0.2% | ||||||||||
4,190,000 | Agilent Technologies, Inc. 2.5000%, 7/15/13 | 4,239,124 | ||||||||
Electronics – Military – 1.4% | ||||||||||
34,476,000 | L-3 Communications Corp. 6.3750%, 10/15/15 | 35,510,280 | ||||||||
Fiduciary Banks – 0.1% | ||||||||||
1,820,000 | Northern Trust Corp. 5.5000%, 8/15/13 | 2,014,682 | ||||||||
Finance – Auto Loans – 1.4% | ||||||||||
4,550,000 | American Honda Finance Corp. 2.3750%, 3/18/13 (144A) | 4,626,476 | ||||||||
25,222,000 | Ford Motor Credit Co. LLC 7.3750%, 2/1/11 | 25,297,389 | ||||||||
7,148,000 | PACCAR Financial Corp. 1.9500%, 12/17/12 | 7,278,866 | ||||||||
37,202,731 | ||||||||||
Finance – Commercial – 0.4% | ||||||||||
10,920,000 | Caterpillar, Inc. 2.0000%, 4/5/13 | 11,108,872 | ||||||||
Finance – Credit Card – 0% | ||||||||||
546,000 | American Express Credit Co. 5.8750%, 5/2/13 | 593,796 | ||||||||
Finance – Investment Bankers/Brokers – 2.1% | ||||||||||
3,271,000 | Charles Schwab Corp. 4.9500%, 6/1/14 | 3,556,993 | ||||||||
3,776,000 | Credit Suisse USA, Inc. 6.1250%, 11/15/11 | 3,956,361 | ||||||||
3,640,000 | Jefferies Group, Inc. 7.7500%, 3/15/12 | 3,891,025 | ||||||||
13,285,000 | Jefferies Group, Inc. 3.8750%, 11/9/15 | 13,057,880 | ||||||||
6,800,000 | Merrill Lynch & Co, Inc. 5.4500%, 2/5/13 | 7,172,599 | ||||||||
9,100,000 | Merrill Lynch & Co, Inc. 6.1500%, 4/25/13 | 9,764,364 | ||||||||
8,585,000 | TD Ameritrade Holding Corp. 2.9500%, 12/1/12 | 8,783,966 | ||||||||
6,097,000 | TD Ameritrade Holding Corp. 4.1500%, 12/1/14 | 6,304,871 | ||||||||
56,488,059 | ||||||||||
Finance – Mortgage Loan Banker – 0.8% | ||||||||||
20,656,000 | Countrywide Home Loan 4.0000%, 3/22/11 | 20,806,603 | ||||||||
Finance – Other Services – 0.2% | ||||||||||
2,552,000 | CME Group, Inc. 5.7500%, 2/15/14 | 2,825,694 | ||||||||
1,820,000 | National Rural Utilities Cooperative Finance Corp. 2.6250%, 9/16/12 | 1,870,631 | ||||||||
4,696,325 | ||||||||||
Food – Confectionary – 1.7% | ||||||||||
11,829,000 | WM Wrigley Jr. Co. 1.6778%, 6/28/11 (144A)‡ | 11,834,453 | ||||||||
11,029,000 | WM Wrigley Jr. Co. 2.4500%, 6/28/12 (144A) | 11,107,218 | ||||||||
11,829,000 | WM Wrigley Jr. Co. 3.0500%, 6/28/13 (144A) | 12,082,365 | ||||||||
9,100,000 | WM Wrigley Jr. Co. 3.7000%, 6/30/14 (144A) | 9,373,519 | ||||||||
44,397,555 | ||||||||||
Food – Meat Products – 0.7% | ||||||||||
18,199,000 | Smithfield Foods, Inc. 7.7500%, 5/15/13 | 19,393,309 | ||||||||
Food – Miscellaneous/Diversified – 1.5% | ||||||||||
6,461,000 | Del Monte Corp. 6.7500%, 2/15/15 | 6,598,296 | ||||||||
1,820,000 | H.J. Heinz Finance Co. 6.6250%, 7/15/11 | 1,876,584 | ||||||||
30,711,000 | Kraft Foods, Inc. 2.6250%, 5/8/13 | 31,583,745 | ||||||||
491,000 | Kraft Foods, Inc. 6.7500%, 2/19/14 | 559,711 | ||||||||
40,618,336 | ||||||||||
Food – Retail – 0.1% | ||||||||||
341,000 | Delhaize Group 5.8750%, 2/1/14 | 376,314 | ||||||||
1,116,000 | Kroger Co. 6.8000%, 4/1/11 | 1,132,367 | ||||||||
1,508,681 | ||||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 51
Table of Contents
Janus Short-Term Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Gas – Distribution – 0.1% | ||||||||||
$2,275,000 | Consolidated Natural Gas Co. 6.2500%, 11/1/11 | $ | 2,371,210 | |||||||
Hotels and Motels – 0.6% | ||||||||||
11,466,000 | Marriott International, Inc. 4.6250%, 6/15/12 | 11,922,851 | ||||||||
4,013,000 | Starwood Hotels & Resorts Worldwide, Inc. 7.8750%, 10/15/14 | 4,554,755 | ||||||||
16,477,606 | ||||||||||
Industrial Gases – 0.6% | ||||||||||
16,379,000 | Praxair, Inc. 2.1250%, 6/14/13 | 16,731,214 | ||||||||
Investment Management and Advisory Services – 1.2% | ||||||||||
21,607,000 | BlackRock, Inc. 2.2500%, 12/10/12 | 22,098,192 | ||||||||
9,418,000 | Franklin Resources, Inc. 2.0000%, 5/20/13 | 9,545,077 | ||||||||
31,643,269 | ||||||||||
Life and Health Insurance – 1.8% | ||||||||||
9,814,000 | Prudential Financial, Inc. 5.1000%, 12/14/11 | 10,141,758 | ||||||||
33,058,000 | Prudential Financial, Inc. 3.6250%, 9/17/12 | 34,308,088 | ||||||||
910,000 | Prudential Financial, Inc. 4.5000%, 7/15/13 | 965,047 | ||||||||
1,474,000 | Prudential Financial, Inc. 6.2000%, 1/15/15 | 1,625,541 | ||||||||
47,040,434 | ||||||||||
Machinery – General Industrial – 0.2% | ||||||||||
4,065,000 | Wabtec Corp. DE 6.8750%, 7/31/13 | 4,268,250 | ||||||||
Medical – HMO – 0.4% | ||||||||||
2,730,000 | UnitedHealth Group, Inc. 5.2500%, 3/15/11 | 2,753,134 | ||||||||
7,764,000 | WellPoint, Inc. 5.0000%, 1/15/11 | 7,772,191 | ||||||||
10,525,325 | ||||||||||
Medical Labs and Testing Services – 0.2% | ||||||||||
3,640,000 | Roche Holdings, Inc. 5.0000%, 3/1/14 (144A) | 3,986,066 | ||||||||
Medical Products – 0.2% | ||||||||||
2,757,000 | CareFusion Corp. 4.1250%, 8/1/12 | 2,872,441 | ||||||||
1,365,000 | Covidien International Finance S.A. 5.4500%, 10/15/12 | 1,471,291 | ||||||||
4,343,732 | ||||||||||
Metal – Aluminum – 0% | ||||||||||
1,092,000 | Rio Tinto Alcan, Inc. 6.4500%, 3/15/11 | 1,104,424 | ||||||||
Multi-Line Insurance – 1.2% | ||||||||||
12,739,000 | MetLife, Inc. 1.5356%, 8/6/13‡ | 12,935,525 | ||||||||
17,378,000 | MetLife, Inc. 2.3750%, 2/6/14 | 17,460,476 | ||||||||
30,396,001 | ||||||||||
Multimedia – 1.3% | ||||||||||
18,199,000 | NBC Universal, Inc. 2.1000%, 4/1/14 (144A) | 18,145,077 | ||||||||
1,820,000 | News America Holdings, Inc. 9.2500%, 2/1/13 | 2,097,541 | ||||||||
14,796,000 | Time Warner, Inc. 3.1500%, 7/15/15 | 15,033,002 | ||||||||
35,275,620 | ||||||||||
Office Automation and Equipment – 0.2% | ||||||||||
3,135,000 | Xerox Corp. 5.5000%, 5/15/12 | 3,311,228 | ||||||||
1,013,000 | Xerox Corp. 8.2500%, 5/15/14 | 1,182,444 | ||||||||
4,493,672 | ||||||||||
Oil Companies – Exploration and Production – 0.5% | ||||||||||
11,763,000 | Forest Oil Corp. 8.0000%, 12/15/11 | 12,292,335 | ||||||||
Oil Companies – Integrated – 1.7% | ||||||||||
14,981,000 | BP Capital Markets PLC 3.1250%, 10/1/15 | 14,970,708 | ||||||||
4,550,000 | Chevron Corp. 3.4500%, 3/3/12 | 4,694,990 | ||||||||
2,275,000 | ConocoPhillips 4.7500%, 2/1/14 | 2,471,246 | ||||||||
22,461,000 | Shell International Finance BV 1.8750%, 3/25/13 | 22,799,757 | ||||||||
44,936,701 | ||||||||||
Oil Refining and Marketing – 0.5% | ||||||||||
4,368,000 | Sunoco Inc. 4.8750%, 10/15/14 | 4,552,465 | ||||||||
7,798,000 | Valero Energy Corp. 6.8750%, 4/15/12 | 8,298,483 | ||||||||
12,850,948 | ||||||||||
Paper and Related Products – 1.1% | ||||||||||
13,563,000 | Georgia-Pacific LLC 8.1250%, 5/15/11 | 14,003,798 | ||||||||
14,697,000 | Georgia-Pacific LLC 7.0000%, 1/15/15 (144A) | 15,248,137 | ||||||||
29,251,935 | ||||||||||
Pipelines – 4.1% | ||||||||||
8,839,000 | DCP Midstream Operating L.P. 3.2500%, 10/1/15 | 8,693,722 | ||||||||
1,976,000 | El Paso Corp. 7.3750%, 12/15/12 | 2,096,915 | ||||||||
8,858,000 | Energy Transfer Partners L.P. 5.6500%, 8/1/12 | 9,385,087 | ||||||||
2,944,000 | Enterprise Products Operating LLC 7.5000%, 2/1/11 | 2,957,007 | ||||||||
13,942,000 | Enterprise Products Operating LLC 4.6000%, 8/1/12 | 14,632,645 | ||||||||
1,092,000 | Kinder Morgan Energy Partners L.P. 6.7500%, 3/15/11 | 1,104,122 | ||||||||
2,543,000 | Kinder Morgan Energy Partners L.P. 5.8500%, 9/15/12 | 2,726,734 | ||||||||
2,939,000 | Kinder Morgan Energy Partners L.P. 5.0000%, 12/15/13 | 3,193,132 | ||||||||
6,488,000 | Kinder Morgan Finance Co. ULC 5.3500%, 1/5/11 | 6,488,000 |
See Notes to Schedules of Investments and Financial Statements.
52 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
$13,520,000 | Kinder Morgan, Inc. 6.5000%, 9/1/12 | $ | 14,229,800 | |||||||
1,092,000 | Oneok, Inc. 7.1250%, 4/15/11 | 1,111,143 | ||||||||
17,932,000 | Plains All American Pipeline L.P. 4.2500%, 9/1/12 | 18,699,418 | ||||||||
19,068,000 | Plains All American Pipeline L.P. / PAA Finance Corp. 3.9500%, 9/15/15 | 19,702,545 | ||||||||
3,203,000 | Transcontinental Gas Pipe Line Co. LLC 7.0000%, 8/15/11 | 3,322,408 | ||||||||
108,342,678 | ||||||||||
Property and Casualty Insurance – 0.1% | ||||||||||
1,633,000 | Chubb Corp. 5.2000%, 4/1/13 | 1,764,396 | ||||||||
Property Trust – 0.4% | ||||||||||
10,920,000 | WEA Finance LLC / WCI Finance LLC 5.4000%, 10/1/12 (144A) | 11,576,554 | ||||||||
Publishing – Books – 0.3% | ||||||||||
7,560,000 | Scholastic Corp. 5.0000%, 4/15/13 | 7,578,900 | ||||||||
Publishing – Newspapers – 0.5% | ||||||||||
12,739,000 | Gannett Co., Inc. 6.3750%, 9/1/15 (144A) | 12,834,543 | ||||||||
Real Estate Management/Services – 0.4% | ||||||||||
9,100,000 | CB Richard Ellis Services, Inc. 11.6250%, 6/15/17 | 10,544,625 | ||||||||
Reinsurance – 1.8% | ||||||||||
4,550,000 | Berkshire Hathaway Finance Corp. 4.0000%, 4/15/12 | 4,731,945 | ||||||||
3,003,000 | Berkshire Hathaway Finance Corp. 4.6000%, 5/15/13 | 3,230,153 | ||||||||
1,069,000 | Berkshire Hathaway Finance Corp. 5.0000%, 8/15/13 | 1,166,835 | ||||||||
18,427,000 | Berkshire Hathaway, Inc. 1.4000%, 2/10/12 | 18,562,439 | ||||||||
18,427,000 | Berkshire Hathaway, Inc. 2.1250%, 2/11/13 | 18,819,937 | ||||||||
46,511,309 | ||||||||||
REIT – Health Care – 3.7% | ||||||||||
7,280,000 | HCP, Inc. 5.9500%, 9/15/11 | 7,515,115 | ||||||||
24,327,000 | HCP, Inc. 6.4500%, 6/25/12 | 25,663,817 | ||||||||
13,031,000 | HCP, Inc. 5.6250%, 2/28/13 | 13,667,369 | ||||||||
14,441,000 | HCP, Inc. 5.6500%, 12/15/13 | 15,511,916 | ||||||||
9,060,000 | Healthcare Realty Trust, Inc. 8.1250%, 5/1/11 | 9,263,723 | ||||||||
5,214,000 | Healthcare Realty Trust, Inc. 5.1250%, 4/1/14 | 5,459,449 | ||||||||
13,181,000 | Senior Housing Properties Trust 8.6250%, 1/15/12 | 13,774,145 | ||||||||
6,121,000 | Ventas Realty L.P. / Ventas Capital Corp. 3.1250%, 11/30/15 | 5,897,498 | ||||||||
96,753,032 | ||||||||||
REIT – Hotels – 1.2% | ||||||||||
6,157,000 | Host Hotels & Resorts L.P. 7.1250%, 11/1/13 | 6,249,355 | ||||||||
18,581,000 | Host Hotels & Resorts L.P. 6.8750%, 11/1/14 | 19,138,430 | ||||||||
7,280,000 | Host Hotels & Resorts L.P. 6.3750%, 3/15/15 | 7,389,200 | ||||||||
32,776,985 | ||||||||||
REIT – Office Property – 0.5% | ||||||||||
13,732,000 | Reckson Operating Partnership L.P. 5.1500%, 1/15/11 | 13,738,688 | ||||||||
REIT – Regional Malls – 1.2% | ||||||||||
4,596,000 | Rouse Co. L.P. 7.2000%, 9/15/12 | 4,814,310 | ||||||||
26,889,000 | Rouse Co. L.P. 6.7500%, 5/1/13 (144A) | 27,863,726 | ||||||||
32,678,036 | ||||||||||
REIT – Shopping Centers – 0.4% | ||||||||||
4,550,000 | Developers Diversified Realty Corp. 5.3750%, 10/15/12 | 4,681,245 | ||||||||
4,550,000 | Equity One, Inc. 6.2500%, 12/15/14 | 4,801,510 | ||||||||
9,482,755 | ||||||||||
Retail – Discount – 0% | ||||||||||
951,000 | Wal-Mart Stores, Inc. 3.2000%, 5/15/14 | 994,680 | ||||||||
Retail – Office Supplies – 0.1% | ||||||||||
2,275,000 | Staples, Inc. 7.7500%, 4/1/11 | 2,311,618 | ||||||||
Retail – Propane Distribution – 0.5% | ||||||||||
12,739,000 | Amerigas Partners L.P. 7.2500%, 5/20/15 | 13,089,323 | ||||||||
Retail – Regional Department Stores – 1.4% | ||||||||||
2,730,000 | JC Penney Corp., Inc. 9.0000%, 8/1/12 | 2,955,225 | ||||||||
20,238,000 | Macy’s Retail Holdings, Inc. 6.6250%, 4/1/11 | 20,490,975 | ||||||||
9,100,000 | Macy’s Retail Holdings, Inc. 5.3500%, 3/15/12 | 9,395,750 | ||||||||
4,145,000 | Macy’s Retail Holdings, Inc. 5.8750%, 1/15/13 | 4,393,700 | ||||||||
37,235,650 | ||||||||||
Retail – Restaurants – 0.7% | ||||||||||
11,219,000 | Brinker International 5.7500%, 6/1/14 | 11,791,147 | ||||||||
5,029,000 | Darden Restaurants, Inc. 5.6250%, 10/15/12 | 5,383,268 | ||||||||
17,174,415 | ||||||||||
Semiconductor Components/Integrated Circuits – 1.1% | ||||||||||
11,102,000 | Analog Devices, Inc. 5.0000%, 7/1/14 | 11,965,436 | ||||||||
16,302,000 | Maxim Integrated Products, Inc. 3.4500%, 6/14/13 | 16,667,621 | ||||||||
28,633,057 | ||||||||||
Steel – Producers – 0.8% | ||||||||||
4,448,000 | ArcelorMittal 5.3750%, 6/1/13 | 4,728,019 |
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 53
Table of Contents
Janus Short-Term Bond Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
$13,649,000 | ArcelorMittal 3.7500%, 8/5/15 | $ | 13,762,642 | |||||||
1,251,000 | Steel Dynamics, Inc. 7.7500%, 4/15/16 | 1,316,677 | ||||||||
19,807,338 | ||||||||||
Super-Regional Banks – 1.7% | ||||||||||
7,280,000 | Bank One Corp. 5.9000%, 11/15/11 | 7,591,795 | ||||||||
9,100,000 | PNC Funding Corp. 5.2500%, 11/15/15 | 9,738,765 | ||||||||
6,750,000 | Wachovia Corp. 4.8750%, 2/15/14 | 7,108,297 | ||||||||
364,000 | Wells Fargo & Co. 5.3000%, 8/26/11 | 375,174 | ||||||||
8,190,000 | Wells Fargo & Co. 4.9500%, 10/16/13 | 8,771,465 | ||||||||
9,100,000 | Wells Fargo & Co. 4.6250%, 4/15/14 | 9,549,149 | ||||||||
546,000 | Wells Fargo Bank N.A. 6.4500%, 2/1/11 | 548,246 | ||||||||
43,682,891 | ||||||||||
Telecommunication Services – 0.7% | ||||||||||
18,199,000 | Qwest Corp. 8.8750%, 3/15/12 | 19,677,669 | ||||||||
Telephone – Integrated – 1.1% | ||||||||||
1,365,000 | AT&T, Inc. 5.8750%, 8/15/12 | 1,470,658 | ||||||||
1,001,000 | AT&T, Inc. 4.9500%, 1/15/13 | 1,072,943 | ||||||||
25,888,000 | Sprint Capital Corp. 7.6250%, 1/30/11 | 25,952,720 | ||||||||
28,496,321 | ||||||||||
Television – 0.1% | ||||||||||
1,365,000 | CBS Corp. 8.2000%, 5/15/14 | 1,592,259 | ||||||||
Textile-Home Furnishings – 0% | ||||||||||
910,000 | Mohawk Industries, Inc. 6.5000%, 1/15/11 | 907,725 | ||||||||
Transportation – Railroad – 0.2% | ||||||||||
2,125,000 | Canadian Pacific Railway Co. 6.2500%, 10/15/11 | 2,217,675 | ||||||||
2,548,000 | Union Pacific Corp. 5.4500%, 1/31/13 | 2,752,253 | ||||||||
4,969,928 | ||||||||||
Transportation – Services – 1.2% | ||||||||||
26,389,000 | Asciano Finance, Ltd. 3.1250%, 9/23/15 (144A) | 25,370,305 | ||||||||
910,000 | Fedex Corp. 7.3750%, 1/15/14 | 1,043,576 | ||||||||
3,821,000 | Ryder System, Inc. 3.6000%, 3/1/16 | 3,809,323 | ||||||||
2,151,000 | United Parcel Service, Inc. 3.8750%, 4/1/14 | 2,291,710 | ||||||||
32,514,914 | ||||||||||
Total Corporate Bonds (cost $1,954,271,137) | 1,987,542,478 | |||||||||
U.S. Treasury Notes/Bonds – 22.2% | ||||||||||
U.S. Treasury Notes/Bonds: | ||||||||||
95,000,000 | 0.8750%, 2/28/11 | 95,100,225 | ||||||||
14,286,000 | 0.7500%, 5/31/12 | 14,354,144 | ||||||||
589,000 | 1.8750%, 6/15/12 | 601,401 | ||||||||
158,934,000 | 0.6250%, 6/30/12** | 159,406,034 | ||||||||
123,309,000 | 1.3750%, 2/15/13 | 125,168,253 | ||||||||
62,606,000 | 1.7500%, 4/15/13 | 64,044,060 | ||||||||
124,005,000 | 1.3750%, 5/15/13** | 125,788,192 | ||||||||
Total U.S. Treasury Notes/Bonds (cost $581,374,768) | 584,462,309 | |||||||||
Short-Term Taxable Variable Rate Demand Note – 0% | ||||||||||
1,135,000 | California Infrastructure & Economic Development Bank 0.7500%, 4/1/24‡ (amortized cost $1,135,000) | 1,135,000 | ||||||||
Money Market – 0.1% | ||||||||||
3,507,278 | Janus Cash Liquidity Fund LLC, 0% (cost $3,507,278) | 3,507,278 | ||||||||
Total Investments (total cost $2,615,215,924) – 100.8% | 2,652,472,365 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.8)% | (22,043,016) | |||||||||
Net Assets – 100% | $ | 2,630,429,349 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Australia | $ | 70,488,869 | 2.7% | |||||
Belgium | 376,314 | 0.0% | ||||||
Canada | 45,773,920 | 1.7% | ||||||
Cayman Islands | 21,306,260 | 0.8% | ||||||
Chile | 13,643,800 | 0.5% | ||||||
Luxembourg | 46,095,171 | 1.8% | ||||||
Netherlands | 40,494,523 | 1.5% | ||||||
New Zealand | 15,468,030 | 0.6% | ||||||
Singapore | 5,971,053 | 0.2% | ||||||
Sweden | 28,538,137 | 1.1% | ||||||
Switzerland | 31,960,535 | 1.2% | ||||||
United Kingdom | 74,367,003 | 2.8% | ||||||
United States†† | 2,257,988,750 | 85.1% | ||||||
Total | $ | 2,652,472,365 | 100.0% |
†† | Includes Cash Equivalents (85.0% excluding Cash Equivalents). |
Financial Futures – Short | ||||||
364 Contracts | U.S. Treasury Note 5 Year expires March 2011, principal amount $42,714,897, value $42,849,625, cumulative depreciation | $ | (134,728) | |||
See Notes to Schedules of Investments and Financial Statements.
54 | DECEMBER 31, 2010
Table of Contents
Janus Money Market Funds (unaudited)
Co-Portfolio Manager | ||
Janus Government Money Market Fund | Eric Thorderson | |
Average Annual Total Return | Co-Portfolio Manager | |
For the Periods Ended December 31, 2010 | David Spilsted | |
Class D Shares(1) | ||
Fiscal Year-to-Date | 0.00% | |
1 Year | 0.02% | |
5 Year | 2.19% | |
10 Year | 2.02% | |
Since Inception (February 14, 1995) | 3.18% | |
Class T Shares | ||
Fiscal Year-to-Date | 0.00% | |
1 Year | 0.02% | |
5 Year | 2.19% | |
10 Year | 2.02% | |
Since Inception (February 14, 1995) | 3.18% | |
Seven-Day Current Yield | ||
Class D Shares(1) | ||
With Reimbursement | 0.0000% | |
Without Reimbursement | 0.0000% | |
Class T Shares | ||
With Reimbursement | 0.0000% | |
Without Reimbursement | 0.0000% | |
Expense Ratio | ||
Per the October 28, 2010 prospectus | ||
Class D Shares(1) | ||
Total Annual Fund Operating Expenses | 0.68% | |
Class T Shares | ||
Total Annual Fund Operating Expenses | 0.72% | |
Co-Portfolio Manager | ||
Janus Money Market Fund | Eric Thorderson | |
Average Annual Total Return | Co-Portfolio Manager | |
For the Periods Ended December 31, 2010 | David Spilsted | |
Class D Shares(1) | ||
Fiscal Year-to-Date | 0.00% | |
1 Year | 0.01% | |
5 Year | 2.30% | |
10 Year | 2.10% | |
Since Inception (February 14, 1995) | 3.28% | |
Class T Shares | ||
Fiscal Year-to-Date | 0.00% | |
1 Year | 0.01% | |
5 Year | 2.30% | |
10 Year | 2.10% | |
Since Inception (February 14, 1995) | 3.28% | |
Seven-Day Current Yield | ||
Class D Shares(1) | ||
With Reimbursement | 0.0000% | |
Without Reimbursement | 0.0000% | |
Class T Shares | ||
With Reimbursement | 0.0000% | |
Without Reimbursement | 0.0000% | |
Expense Ratio | ||
Per the October 28, 2010 prospectus | ||
Class D Shares(1) | ||
Total Annual Fund Operating Expenses | 0.67% | |
Class T Shares | ||
Total Annual Fund Operating Expenses | 0.71% | |
Data presented represents past performance, which is no guarantee of future results. Current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
An investment in a money market fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the money market fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.
Janus Capital has agreed to waive one-half of its advisory fee. Such waiver is voluntary and could change or be terminated at any time at the discretion of Janus Capital. Total returns shown include fee waivers, if any, and without such waivers, the Fund’s yields and total returns would have been lower. Janus Capital may also voluntarily waive additional fees to the extent necessary to assist the Fund in attempting to maintain a yield of at least 0.00%. These reimbursements are voluntary and could change or be terminated at any time at the discretion of Janus Capital.
Included in the Total Annual Fund Operating Expenses is an administration fee of 0.46% for Class D Shares and 0.48% for Class T Shares of the average daily net assets of the Fund to compensate Janus Capital for providing certain administrative services including, but not limited to, recordkeeping and registration functions.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
Effective February 16, 2010, the Fund’s renamed Class J Shares to Class T Shares.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different.
Returns include reinvestment of dividends from net investment income and distributions from capital gains.
The yield more closely reflects the current earnings of the Fund than the total return.
See Notes to Schedules of Investments and Financial Statements.
See “Explanations of Charts, Tables and Financial Statements.”
(1) | Closed to new investors. |
Janus Fixed Income & Money Market Funds | 55
Table of Contents
Janus Government Money Market Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning | Ending | Expenses Paid | ||||||||||||
Account Value | Account Value | During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 1.21 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,024.00 | $ | 1.22 | ||||||||
Beginning | Ending | Expenses Paid | ||||||||||||
Account Value | Account Value | During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 1.21 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,024.00 | $ | 1.22 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.24% for Class D and 0.24% for Class T Shares, Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of voluntary waivers by Janus Capital. |
Janus Money Market Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning | Ending | Expenses Paid | ||||||||||||
Account Value | Account Value | During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 1.26 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.95 | $ | 1.28 | ||||||||
Beginning | Ending | Expenses Paid | ||||||||||||
Account Value | Account Value | During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,000.00 | $ | 1.26 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,023.95 | $ | 1.28 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.25% for Class D Shares and 0.25% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of voluntary waivers by Janus Capital. |
56 | DECEMBER 31, 2010
Table of Contents
Janus Government Money Market Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Principal Amount | Value | |||||||||
Repurchase Agreements – 23.0% | ||||||||||
$30,700,000 | Credit Suisse Securities (USA) LLC 0.1500%, dated 12/31/10 maturing 1/3/11 to be repurchased at $30,700,384 collateralized by $170,133,151 in U.S. Government Agencies 1.2606% – 461.7200% 12/25/21 – 11/25/40 with a value of $31,314,646 | $ | 30,700,000 | |||||||
15,800,000 | RBC Capital Markets Corp. 0.2200%, dated 12/31/10 maturing 1/3/11 to be repurchased at $284,205,210 collateralized by $473,278,125 in U.S. Government Agencies 2.6250% – 5.7760% 3/1/16 – 12/20/40 with a value of $289,884,000 | 15,800,000 | ||||||||
Total Repurchase Agreements (amortized cost $46,500,000) | 46,500,000 | |||||||||
U.S. Government Agency Notes – 35.6% | ||||||||||
Army & Air Force Exchange Services: | ||||||||||
5,000,000 | 0.3500%, 1/20/11ß | 5,000,000 | ||||||||
5,000,000 | 0.3500%, 1/28/11ß | 5,000,000 | ||||||||
Fannie Mae: | ||||||||||
5,000,000 | 0.2100%, 2/9/11 | 4,998,846 | ||||||||
5,000,000 | 0.2700%, 3/1/11 | 4,997,786 | ||||||||
2,500,000 | 0.2300%, 4/27/11 | 2,498,121 | ||||||||
3,000,000 | 0.2100%, 6/15/11 | 2,997,112 | ||||||||
Federal Home Loan Bank System: | ||||||||||
5,000,000 | 0.2200%, 3/25/11 | 4,997,428 | ||||||||
5,000,000 | 0.1950%, 5/12/11 | 4,996,402 | ||||||||
3,000,000 | 0.2000%, 5/17/11 | 2,997,733 | ||||||||
3,000,000 | 0.2000%, 6/3/11 | 2,997,450 | ||||||||
6,651,078 | 0.2700%, 1/15/42 | 6,651,078 | ||||||||
Freddie Mac: | ||||||||||
5,000,000 | 0.2100%, 2/14/11 | 4,998,698 | ||||||||
3,000,000 | 0.2300%, 4/5/11 | 2,998,173 | ||||||||
5,000,000 | 0.2000%, 4/11/11 | 4,997,183 | ||||||||
3,000,000 | 0.1800%, 4/19/11 | 2,998,380 | ||||||||
5,000,000 | 0.2000%, 5/19/11 | 4,996,167 | ||||||||
3,000,000 | 0.2000%, 6/13/11 | 2,997,283 | ||||||||
Total U.S. Government Agency Notes (amortized cost $72,117,840) | 72,117,840 | |||||||||
Variable Rate Demand Agency Notes – 41.5% | ||||||||||
1,280,000 | A.E. Realty LLC, Series 2003 0.3400%, 10/1/23 | 1,280,000 | ||||||||
4,120,000 | Cunat Capital Corp. 0.3000%, 4/1/36 | 4,120,000 | ||||||||
9,000,000 | Cypress Bend Real Estate Development LLC 0.3400%, 4/1/33 | 9,000,000 | ||||||||
6,260,000 | Florida Housing Financial Corp. Multifamily Revenue, (Stone Harbor Apartments), Series K 0.3100%, 7/15/36 | 6,260,000 | ||||||||
1,780,000 | GMC Financing LLC 0.4500%, 6/1/30 | 1,780,000 | ||||||||
3,300,000 | Indian Hills Country Club 0.3400%, 3/1/30 | 3,300,000 | ||||||||
2,500,000 | J&E Irrevocable Trust Agreement 0.3400%, 12/1/20 | 2,500,000 | ||||||||
3,745,000 | Johnson Capital Management LLC 0.3900%, 6/1/47 | 3,745,000 | ||||||||
165,000 | Lakeshore Professional Properties LLC 0.4400%, 7/1/45 | 165,000 | ||||||||
700,000 | Maryland State Community Development Administration Multifamily Development (Crusader-D) 0.2900%, 2/1/41 | 700,000 | ||||||||
28,000,000 | Mesivta Yeshiva Rabbi Chaim 0.2600%, 11/1/35 | 28,000,000 | ||||||||
4,835,000 | Mississippi Business Finance Corp., Mississippi Revenue (John Fayard), Series A 0.3500%, 3/1/29 | 4,835,000 | ||||||||
4,980,000 | Mississippi Business Finance Corp., Mississippi Revenue (John Fayard), Series B 0.3500%, 3/1/29 | 4,980,000 | ||||||||
2,065,000 | New York City Housing Development Corp. Multifamily Revenue (Aldus St. Apartments), Series A 0.3200%, 6/15/37 | 2,065,000 | ||||||||
500,000 | Sacramento California Redevelopment Agency 0.3200%, 1/15/36 | 500,000 | ||||||||
1,740,000 | Shepherd Capital LLC 0.4400%, 10/1/53 | 1,740,000 | ||||||||
4,500,000 | Thomas H. Turner Family IRR Trust 0.3400%, 6/1/20 | 4,500,000 | ||||||||
4,450,000 | Tyler Enterprises LLC 0.3400%, 10/1/22 | 4,450,000 | ||||||||
Total Variable Rate Demand Agency Notes (amortized cost $83,920,000) | 83,920,000 | |||||||||
Total Investments (total amortized cost $202,537,840 ) – 100.1% | 202,537,840 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.1)% | (188,727) | |||||||||
Net Assets – 100% | $ | 202,349,113 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 57
Table of Contents
Janus Money Market Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Principal Amount | Value | |||||||||
Certificates Of Deposit – 10.7% | ||||||||||
$25,000,000 | Bank of Montreal/Chicago 0.2400%, 1/20/11 | $ | 25,000,000 | |||||||
20,000,000 | Bank of Montreal/Chicago 0.2400%, 1/27/11 | 20,000,000 | ||||||||
20,000,000 | Bank of Montreal/Chicago 0.2500%, 1/31/11 | 20,000,000 | ||||||||
25,000,000 | Rabobank Nederland NV/NY 0.4100%, 1/31/11 | 25,003,328 | ||||||||
25,000,000 | Rabobank Nederland NV/NY 0.2400%, 2/10/11 | 25,000,000 | ||||||||
25,000,000 | Toronto-Dominion Bank/NY 0.2000%, 1/10/11 | 25,000,000 | ||||||||
Total Certificates Of Deposit (amortized cost $140,003,328) | 140,003,328 | |||||||||
Floating Rate Note – 2.3% | ||||||||||
30,000,000 | Bank of America Corp. (same day put) 0.3000%, 1/3/11 (amortized cost $30,000,000) | 30,000,000 | ||||||||
Repurchase Agreements – 47.1% | ||||||||||
183,400,000 | Goldman Sachs & Co. 0.1600%, dated 12/31/10 maturing 1/3/11 to be repurchased at $183,402,445 collateralized by $193,713,155 in a U.S. Government Agency 6.2500%, 12/20/39 with a value of $187,068,000 | 183,400,000 | ||||||||
150,000,000 | HSBC Securities (USA), Inc. 0.2200%, dated 12/31/10 maturing 1/3/11 to be repurchased at $150,002,750 collateralized by $198,416,741 in U.S. Government Agencies 5.0000% – 6.5000%, 12/1/33 – 8/1/39 with a value of $153,002,076 | 150,000,000 | ||||||||
284,200,000 | RBC Capital Markets Corp. 0.2200%, dated 12/31/10 maturing 1/3/11 to be repurchased at $284,205,210 collateralized by $473,278,125 in U.S. Government Agencies 2.6250% – 5.7760% 3/1/16 – 12/20/40 with a value of $289,884,000 | 284,200,000 | ||||||||
Total Repurchase Agreements (amortized cost $617,600,000) | 617,600,000 | |||||||||
U.S. Government Agency Notes – 25.7% | ||||||||||
Army & Air Force Exchange Services: | ||||||||||
$10,000,000 | 0.3500%, 1/11/11ß | 10,000,000 | ||||||||
25,000,000 | 0.3500%, 1/20/11ß | 25,000,000 | ||||||||
30,000,000 | 0.3500%, 1/28/11ß | 30,000,000 | ||||||||
Fannie Mae: | ||||||||||
10,000,000 | 0.2100%, 2/9/11 | 9,997,692 | ||||||||
10,000,000 | 0.2700%, 3/1/11 | 9,995,573 | ||||||||
20,000,000 | 0.2300%, 3/28/11 | 19,988,854 | ||||||||
10,000,000 | 0.1850%, 4/25/11 | 9,994,141 | ||||||||
7,000,000 | 0.2300%, 5/3/11 | 6,994,467 | ||||||||
10,000,000 | 0.2100%, 5/4/11 | 9,992,824 | ||||||||
10,000,000 | 0.2000%, 6/8/11 | 9,991,222 | ||||||||
10,000,000 | 0.2100%, 6/15/11 | 9,990,375 | ||||||||
10,000,000 | 0.2250%, 6/20/11 | 9,989,225 | ||||||||
Federal Home Loan Bank System: | ||||||||||
12,000,000 | 0.1900%, 5/11/11 | 11,991,766 | ||||||||
10,000,000 | 0.2000%, 5/17/11 | 9,992,443 | ||||||||
10,000,000 | 0.2000%, 6/3/11 | 9,991,500 | ||||||||
Freddie Mac: | ||||||||||
10,000,000 | 0.3100%, 1/10/11 | 9,999,214 | ||||||||
10,000,000 | 0.2100%, 2/14/11 | 9,997,397 | ||||||||
12,000,000 | 0.2300%, 4/5/11 | 11,992,691 | ||||||||
10,000,000 | 0.2000%, 4/11/11 | 9,994,366 | ||||||||
20,000,000 | 0.1800%, 4/19/11 | 19,989,199 | ||||||||
10,000,000 | 0.2050%, 5/2/11 | 9,993,012 | ||||||||
10,000,000 | 0.1900%, 5/4/11 | 9,993,508 | ||||||||
10,000,000 | 0.1900%, 5/9/11 | 9,993,244 | ||||||||
10,000,000 | 0.2000%, 5/19/11 | 9,992,333 | ||||||||
10,000,000 | 0.2000%, 6/6/11 | 9,991,333 | ||||||||
10,000,000 | 0.2000%, 6/13/11 | 9,990,944 | ||||||||
10,000,000 | 0.2100%, 7/6/11 | 9,989,149 | ||||||||
10,000,000 | 0.2400%, 8/16/11 | 9,984,865 | ||||||||
Total U.S. Government Agency Notes (amortized cost $335,811,337) | 335,811,337 | |||||||||
Variable Rate Demand Agency Notes – 14.2% | ||||||||||
425,000 | Arapahoe County, Colorado, Industrial Development Revenue, (Cottrell), Series B, 0.5100%, 10/1/19 | 425,000 | ||||||||
4,635,000 | Brattlebro Retreat, 0.3400%, 1/1/36 | 4,635,000 | ||||||||
4,000,000 | Breckenridge Terrace LLC, 0.2700%, 5/1/39 | 4,000,000 | ||||||||
14,980,000 | Breckenridge Terrace LLC, 0.2700%, 5/1/39 | 14,980,000 | ||||||||
800,000 | California Infrastructure and Economic Development, 0.5200%, 7/1/33 | 800,000 | ||||||||
1,145,000 | Capital Markets Access, 0.3400%, 7/1/25 | 1,145,000 | ||||||||
5,700,000 | Colorado Housing Facilities Revenue, (Tenderfoot Seasonal Housing LLC), Series A, 0.2700%, 7/1/35 | 5,700,000 | ||||||||
6,170,000 | Congress Commons LLC, 0.3600%, 12/1/50 | 6,170,000 | ||||||||
6,455,000 | Danville-Pittsylvania, Virginia Facility Revenue, (Cane Creek Project), 0.2900%, 1/1/26 | 6,455,000 | ||||||||
9,100,000 | Eagle County, Colorado Housing Facility Revenue, (BC Housing LLC Project), Series A, 0.2700%, 6/1/27 | 9,100,000 | ||||||||
8,000,000 | Eagle County, Colorado Housing Facility Revenue, (BC Housing LLC Project), Series A, 0.2700%, 5/1/39 | 8,000,000 | ||||||||
11,830,000 | Eskaton Properties, Inc., 0.6000%, 12/1/37 | 11,830,000 | ||||||||
4,620,000 | FJM Properties-Wilmar, 0.4000%, 10/1/24 | 4,620,000 | ||||||||
15,000,000 | HHH Supply and Investment Co., 0.3500%, 7/1/29 | 15,000,000 | ||||||||
5,620,000 | Hunter’s Ridge, South Point, 0.3000%, 6/1/25 | 5,620,000 | ||||||||
4,650,000 | J-J Properties LLC, 0.3000%, 7/1/35 | 4,650,000 |
See Notes to Schedules of Investments and Financial Statements.
58 | DECEMBER 31, 2010
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Schedule of Investments (unaudited)
As of December 31, 2010
Principal Amount | Value | |||||||||
$605,000 | Kentucky Economic Development Finance Authority, 1.0000%, 11/1/15 | $ | 605,000 | |||||||
1,980,000 | Lone Tree Building Authority, 1.1500%, 12/1/17 | 1,980,000 | ||||||||
9,000,000 | Louisiana Local Government Environmental Facilities, 0.3300%, 7/1/47 | 9,000,000 | ||||||||
3,500,000 | Lowell Family LLC, 0.6800%, 4/1/30 | 3,500,000 | ||||||||
10,000,000 | Massachusetts Health & Educational Facilities Authority, 0.3100%, 10/1/42 | 10,000,000 | ||||||||
6,115,000 | Mississippi Business Finance, Corp., 0.3600%, 12/1/39 | 6,115,000 | ||||||||
5,945,000 | Monongallia Health Systems, 0.3600%, 7/1/40 | 5,945,000 | ||||||||
160,000 | Phoenix, Illinois Realty Special Account Multifamily Revenue, (Brightons Mark), 0.4500%, 4/1/20 | 160,000 | ||||||||
3,650,000 | Riley Family Eagle Lake/Lexington Heights L.P., 0.2900%, 9/1/33 | 3,650,000 | ||||||||
300,000 | Saint Joseph, Missouri Industrial Development Authority Revenue, (Albaugh, Inc. Project), Series, 0.6500%, 11/1/19 | 300,000 | ||||||||
4,610,000 | Springfield, Tennessee, Health and Educational Facilities Revenue, Series A, 0.3400%, 6/1/26 | 4,610,000 | ||||||||
2,600,000 | Tift County, Georgia Development Authority, (Heatcraft), Series A, 0.3400%, 2/1/18 | 2,600,000 | ||||||||
3,870,000 | Timber Ridge County Affordable Housing Corp., Series 2003, 0.2700%, 12/1/32 | 3,870,000 | ||||||||
4,825,000 | Triple Crown Investments, 0.3300%, 8/1/25 | 4,825,000 | ||||||||
100,000 | Union City, Tennessee Industrial Development Board, (Cobank LLC Project), 0.6800%, 1/1/25 | 100,000 | ||||||||
1,820,000 | Volunteers of America, Alabama, 0.3400%, 9/1/23 | 1,820,000 | ||||||||
23,935,000 | Washington Higher Education Facilities Authority, 0.3200%, 10/1/30 | 23,935,000 | ||||||||
Total Variable Rate Demand Agency Notes (amortized cost $186,145,000) | 186,145,000 | |||||||||
Total Investments (total amortized cost $1,309,559,665 ) – 100.0% | 1,309,559,665 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.0% | 432,108 | |||||||||
Net Assets – 100% | $ | 1,309,991,773 | ||||||||
See Notes to Schedules of Investments and Financial Statements.
Janus Fixed Income & Money Market Funds | 59
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Statements of Assets and Liabilities - Fixed Income Funds
As of December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands except net asset value per share) | Janus Flexible Bond Fund | Janus Global Bond Fund(1) | Janus High-Yield Fund | Janus Short-Term Bond Fund | ||||||||||||
Assets: | ||||||||||||||||
Investments at cost | $ | 3,108,679 | $ | 10,009 | $ | 1,442,752 | $ | 2,615,216 | ||||||||
Unaffiliated investments at value | $ | 3,153,063 | $ | – | $ | 1,478,353 | $ | 2,648,965 | ||||||||
Affiliated investments at value | 23,933 | 10,009 | 76,903 | 3,507 | ||||||||||||
Cash | 790 | 4 | 449 | 733 | ||||||||||||
Receivables: | ||||||||||||||||
Investments sold | – | – | – | 15,955 | ||||||||||||
Fund shares sold | 3,783 | 3 | 4,942 | 3,226 | ||||||||||||
Dividends | 35 | – | 22 | 11 | ||||||||||||
Due from adviser | – | 1 | – | – | ||||||||||||
Interest | 33,954 | – | 24,835 | 24,172 | ||||||||||||
Non-interested Trustees’ deferred compensation | 89 | – | 44 | 75 | ||||||||||||
Other assets | 38 | – | 3,737 | 19 | ||||||||||||
Total Assets | 3,215,685 | 10,017 | 1,589,285 | 2,696,663 | ||||||||||||
Liabilities: | ||||||||||||||||
Payables: | ||||||||||||||||
Investments purchased | 10,705 | – | – | 901 | ||||||||||||
Fund shares repurchased | 7,170 | 1 | 3,975 | 63,424 | ||||||||||||
Dividends | 722 | – | 666 | 120 | ||||||||||||
Advisory fees | 1,122 | – | 751 | 949 | ||||||||||||
Administrative services fees | 242 | – | 211 | 443 | ||||||||||||
Distribution fees and shareholder servicing fees | 328 | 1 | 97 | 91 | ||||||||||||
Administrative, networking and omnibus fees | 246 | – | – | – | ||||||||||||
Non-interested Trustees’ fees and expenses | 18 | – | 8 | 13 | ||||||||||||
Non-interested Trustees’ deferred compensation fees | 89 | – | 44 | 75 | ||||||||||||
Accrued expenses and other payables | 182 | 2 | 155 | 104 | ||||||||||||
Variation margin | – | – | – | 114 | ||||||||||||
Total Liabilities | 20,824 | 4 | 5,907 | 66,234 | ||||||||||||
Net Assets | $ | 3,194,861 | $ | 10,013 | $ | 1,583,378 | $ | 2,630,429 |
See Notes to Financial Statements.
See footnotes at the end of the Statements.
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Statements of Assets and Liabilities - Fixed Income Funds (continued)
As of December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands except net asset value per share) | Janus Flexible Bond Fund | Janus Global Bond Fund(1) | Janus High-Yield Fund | Janus Short-Term Bond Fund | ||||||||||||
Net Assets Consist of: | ||||||||||||||||
Capital (par value and paid-in surplus)* | $ | 3,118,827 | $ | 10,015 | $ | 1,522,774 | $ | 2,590,337 | ||||||||
Undistributed net investment income/(loss)* | 886 | (2) | 2,247 | 612 | ||||||||||||
Undistributed net realized gain/(loss) from investment and foreign currency transactions* | 6,830 | – | (54,148) | 2,357 | ||||||||||||
Unrealized net appreciation of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 68,318 | – | 112,505 | 37,123 | ||||||||||||
Total Net Assets | $ | 3,194,861 | $ | 10,013 | $ | 1,583,378 | $ | 2,630,429 | ||||||||
Net Assets - Class A Shares | $ | 371,813 | $ | 833 | $ | 142,386 | $ | 133,482 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 35,707 | 83 | 15,658 | 43,350 | ||||||||||||
Net Asset Value Per Share(2) | $ | 10.41 | $ | 10.00 | $ | 9.09 | $ | 3.08 | ||||||||
Maximum Offering Price Per Share(3) | $ | 10.93 | $ | 10.50 | $ | 9.54 | $ | 3.16 | ||||||||
Net Assets - Class C Shares | $ | 270,120 | $ | 834 | $ | 77,062 | $ | 71,276 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 25,938 | 83 | 8,472 | 23,189 | ||||||||||||
Net Asset Value Per Share(2) | $ | 10.41 | $ | 10.00 | $ | 9.10 | $ | 3.07 | ||||||||
Net Assets - Class D Shares | $ | 687,417 | $ | 838 | $ | 294,579 | $ | 221,840 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 66,014 | 84 | 32,398 | 72,009 | ||||||||||||
Net Asset Value Per Share | $ | 10.41 | $ | 10.00 | $ | 9.09 | $ | 3.08 | ||||||||
Net Assets - Class I Shares | $ | 1,076,833 | $ | 5,842 | $ | 197,373 | $ | 319,673 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 103,416 | 584 | 21,696 | 103,911 | ||||||||||||
Net Asset Value Per Share | $ | 10.41 | $ | 10.00 | $ | 9.10 | $ | 3.08 | ||||||||
Net Assets - Class R Shares | $ | 7,837 | $ | N/A | $ | 895 | $ | N/A | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 753 | N/A | 98 | N/A | ||||||||||||
Net Asset Value Per Share | $ | 10.41 | $ | N/A | $ | 9.09 | $ | N/A | ||||||||
Net Assets - Class S Shares | $ | 57,563 | $ | 833 | $ | 7,588 | $ | 5,352 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 5,526 | 83 | 833 | 1,742 | ||||||||||||
Net Asset Value Per Share | $ | 10.42 | $ | 10.00 | $ | 9.11 | $ | 3.07 | ||||||||
Net Assets - Class T Shares | $ | 723,278 | $ | 833 | $ | 863,495 | $ | 1,878,806 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 69,457 | 83 | 94,960 | 609,619 | ||||||||||||
Net Asset Value Per Share | $ | 10.41 | $ | 10.00 | $ | 9.09 | $ | 3.08 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from December 28, 2010 (inception date) through December 31, 2010. | |
(2) | Redemption price per share may be reduced for any applicable contingent deferred sales charge. | |
(3) | Maximum offering price is computed at 100/95.25 of net asset value for Janus Flexible Bond Fund, Janus Global Bond Fund, and Janus High-Yield Fund and 100/97.50 of net asset value for Janus Short-Term Bond Fund. |
See Notes to Financial Statements.
62 | DECEMBER 31, 2010
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Statements of Operations - Fixed Income Funds
For the six-month period ended December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands) | Janus Flexible Bond Fund | Janus Global Bond Fund(1) | Janus High-Yield Fund | Janus Short-Term Bond Fund | ||||||||||||
Investment Income: | ||||||||||||||||
Interest | $ | 65,189 | $ | – | $ | 59,890 | $ | 39,736 | ||||||||
Dividends | – | – | 474 | – | ||||||||||||
Dividends from affiliates | 152 | – | 78 | 62 | ||||||||||||
Fee income | 68 | – | 91 | 123 | ||||||||||||
Total Investment Income | 65,409 | – | 60,533 | 39,921 | ||||||||||||
Expenses: | ||||||||||||||||
Advisory fees | 6,430 | 1 | 4,091 | 7,519 | ||||||||||||
Shareholder reports expense | 349 | – | 137 | 165 | ||||||||||||
Transfer agent fees and expenses | 74 | – | 27 | 37 | ||||||||||||
Registration fees | 162 | 2 | 118 | 149 | ||||||||||||
Custodian fees | 8 | – | 7 | 9 | ||||||||||||
Professional fees | 38 | 1 | 29 | 43 | ||||||||||||
Non-interested Trustees’ fees and expenses | 65 | – | 29 | 59 | ||||||||||||
Administrative services fees - Class D Shares | 429 | – | 166 | 140 | ||||||||||||
Administrative services fees - Class R Shares | 10 | N/A | 1 | N/A | ||||||||||||
Administrative services fees - Class S Shares | 80 | – | 8 | 6 | ||||||||||||
Administrative services fees - Class T Shares | 913 | – | 997 | 2,561 | ||||||||||||
Distribution fees and shareholder servicing fees - Class A Shares | 456 | – | 158 | 169 | ||||||||||||
Distribution fees and shareholder servicing fees - Class C Shares | 1,344 | – | 372 | 354 | ||||||||||||
Distribution fees and shareholder servicing fees - Class R Shares | 19 | N/A | 3 | N/A | ||||||||||||
Distribution fees and shareholder servicing fees - Class S Shares | 80 | – | 8 | 6 | ||||||||||||
Administrative, networking and omnibus fees - Class A Shares | 98 | – | 27 | 37 | ||||||||||||
Administrative, networking and omnibus fees - Class C Shares | 90 | – | 20 | 25 | ||||||||||||
Administrative, networking and omnibus fees - Class I Shares | 464 | – | 19 | 67 | ||||||||||||
Other expenses | 90 | – | 245 | 80 | ||||||||||||
Non-recurring costs (Note 4) | – | N/A | – | – | ||||||||||||
Costs assumed by Janus Capital Management LLC (Note 4) | – | N/A | – | – | ||||||||||||
Total Expenses | 11,199 | 4 | 6,462 | 11,426 | ||||||||||||
Expense and Fee Offset | (2) | – | (2) | (1) | ||||||||||||
Net Expenses | 11,197 | 4 | 6,460 | 11,425 | ||||||||||||
Less: Excess Expense Reimbursement | – | (1) | – | (644) | ||||||||||||
Net Expenses after Expense Reimbursement | 11,197 | 3 | 6,460 | 10,781 | ||||||||||||
Net Investment Income/(Loss) | 54,212 | (3) | 54,073 | 29,140 | ||||||||||||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||||||||||||||
Net realized gain from investment and foreign currency transactions | 53,373 | – | 37,510 | 12,631 | ||||||||||||
Net realized gain/(loss) from futures contracts | (56) | – | – | – | ||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | (45,454) | – | 56,163 | (859) | ||||||||||||
Net Gain on Investments | 7,863 | – | 93,673 | 11,772 | ||||||||||||
Net Increase/(Decrease) in Net Assets Resulting from Operations | $ | 62,075 | $ | (3) | $ | 147,746 | $ | 40,912 |
(1) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
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Statements of Changes in Net Assets - Fixed Income Funds
For the six-month period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal | Janus Flexible | Janus Global | Janus | Janus Short-Term | ||||||||||||||||||||||||||||||||||||
year ended October 31, 2009 | Bond Fund | Bond Fund | High-Yield Fund | Bond Fund | ||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009 | 2010(2) | 2010 | 2010(1) | 2009 | 2010 | 2010(1) | 2009 | ||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||||||||||
Net investment income/(loss) | $ | 54,212 | $ | 63,020 | $ | 48,224 | $ | (3) | $ | 54,073 | $ | 64,981 | $ | 76,100 | $ | 29,140 | $ | 32,341 | $ | 20,655 | ||||||||||||||||||||
Net realized gain/(loss) from investment and foreign currency transactions | 53,373 | 58,802 | 33,784 | – | 37,510 | 39,221 | (42,414) | 12,631 | 11,715 | 5,043 | ||||||||||||||||||||||||||||||
Net realized gain/(loss) from futures contracts | (56) | (1,919) | – | – | – | – | – | – | (657) | – | ||||||||||||||||||||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | (45,454) | 21,070 | 125,978 | – | 56,163 | (19,092) | 171,845 | (859) | 5,322 | 32,492 | ||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Net Assets Resulting from Operations | 62,075 | 140,973 | 207,986 | (3) | 147,746 | 85,110 | 205,531 | 40,912 | 48,721 | 58,190 | ||||||||||||||||||||||||||||||
Dividends and Distributions to Shareholders: | ||||||||||||||||||||||||||||||||||||||||
Net Investment Income* | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (6,214) | (7,137) | (3,018) | – | (4,619) | (5,425) | (2,470) | (1,406) | (1,307) | (171) | ||||||||||||||||||||||||||||||
Class C Shares | (3,548) | (4,268) | (1,552) | – | (2,447) | (3,401) | (1,539) | (469) | (465) | (61) | ||||||||||||||||||||||||||||||
Class D Shares | (12,758) | (9,498) | N/A | – | (10,349) | (7,450) | N/A | (2,551) | (1,952) | N/A | ||||||||||||||||||||||||||||||
Class I Shares | (17,918) | (17,175) | (2,987) | 1 | (5,755) | (2,418) | (499) | (2,788) | (2,008) | (86) | ||||||||||||||||||||||||||||||
Class R Shares | (113) | (112) | (33) | N/A | (35) | (57) | (28) | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (1,029) | (1,719) | (877) | – | (240) | (364) | (161) | (44) | (72) | (22) | ||||||||||||||||||||||||||||||
Class T Shares | (12,618) | (23,412) | (39,850) | – | (29,388) | (45,737) | (71,629) | (21,179) | (26,629) | (20,188) | ||||||||||||||||||||||||||||||
Net Realized Gain/(Loss) from Investment Transactions* | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (11,992) | (1,373) | – | – | – | – | – | (1,038) | (14) | – | ||||||||||||||||||||||||||||||
Class C Shares | (8,699) | (988) | – | – | – | – | – | (565) | (8) | – | ||||||||||||||||||||||||||||||
Class D Shares | (22,228) | – | N/A | – | – | – | N/A | (1,775) | – | N/A | ||||||||||||||||||||||||||||||
Class I Shares | (34,295) | (2,818) | – | – | – | – | – | (2,460) | (21) | – | ||||||||||||||||||||||||||||||
Class R Shares | (258) | (19) | – | N/A | – | – | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (1,864) | (409) | – | – | – | – | – | (38) | (1) | – | ||||||||||||||||||||||||||||||
Class T Shares | (23,387) | (6,281) | – | – | – | – | – | (15,511) | (361) | – | ||||||||||||||||||||||||||||||
Net Decrease from Dividends and Distributions | (156,921) | (75,209) | (48,317) | 1 | (52,833) | (64,852) | (76,326) | (49,824) | (32,838) | (20,528) | ||||||||||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||||||||||
Shares Sold | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | 133,996 | 144,388 | 99,964 | 833 | 41,582 | 46,880 | 32,160 | 58,229 | 101,295 | 44,791 | ||||||||||||||||||||||||||||||
Class C Shares | 71,868 | 102,952 | 58,100 | 833 | 11,218 | 18,069 | 23,589 | 18,335 | 44,192 | 23,813 | ||||||||||||||||||||||||||||||
Class D Shares | 99,747 | 72,155 | N/A | 839 | 41,806 | 19,497 | N/A | 28,647 | 31,219 | N/A | ||||||||||||||||||||||||||||||
Class I Shares | 443,146 | 410,024 | 307,620 | 5,850 | 131,634 | 62,691 | 15,328 | 219,332 | 149,306 | 71,096 | ||||||||||||||||||||||||||||||
Class R Shares | 4,260 | 3,450 | 1,990 | N/A | 246 | 792 | 43 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | 9,560 | 30,833 | 23,950 | 833 | 1,831 | 3,284 | 2,904 | 2,025 | 4,829 | 6,819 | ||||||||||||||||||||||||||||||
Class T Shares | 269,674 | 331,547 | 466,061 | 833 | 203,050 | 281,066 | 467,613 | 503,372 | 1,355,753 | 1,260,160 | ||||||||||||||||||||||||||||||
Shares Issued in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||
Class D Shares | N/A | 612,047 | N/A | N/A | N/A | 251,932 | N/A | N/A | 233,703 | N/A |
See Notes to Financial Statements.
See footnotes at the end of the Statements.
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Statements of Changes in Net Assets - Fixed Income Funds (continued)
For the six-month period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal | Janus Flexible | Janus Global | Janus | Janus Short-Term | ||||||||||||||||||||||||||||||||||||
year ended October 31, 2009 | Bond Fund | Bond Fund | High-Yield Fund | Bond Fund | ||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009 | 2010(2) | 2010 | 2010(1) | 2009 | 2010 | 2010(1) | 2009 | ||||||||||||||||||||||||||||||
Shares Issued in Connection with Acquisition (Note 10) | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | N/A | N/A | 182,146 | N/A | N/A | N/A | 55,786 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class C Shares | N/A | N/A | 107,892 | N/A | N/A | N/A | 36,350 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class I Shares | N/A | N/A | 140,078 | N/A | N/A | N/A | 11,556 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | 1,321 | N/A | N/A | N/A | 879 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | N/A | N/A | 58,255 | N/A | N/A | N/A | 3,581 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Redemption Fees | ||||||||||||||||||||||||||||||||||||||||
Class D Shares | N/A | N/A | N/A | N/A | 14 | 23 | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class I Shares | N/A | N/A | N/A | N/A | 4 | 15 | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | N/A | – | – | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | N/A | N/A | N/A | N/A | – | 3 | 5 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class T Shares | N/A | N/A | N/A | N/A | 50 | 242 | 346 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Reinvested Dividends and Distributions | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | 16,383 | 7,288 | 2,200 | – | 4,075 | 4,512 | 2,021 | 2,090 | 1,009 | 78 | ||||||||||||||||||||||||||||||
Class C Shares | 7,180 | 2,901 | 824 | – | 1,881 | 2,575 | 1,114 | 727 | 321 | 42 | ||||||||||||||||||||||||||||||
Class D Shares | 32,483 | 9,790 | N/A | – | 8,670 | 6,961 | N/A | 4,220 | 2,146 | N/A | ||||||||||||||||||||||||||||||
Class I Shares | 44,606 | 16,901 | 2,842 | – | 5,186 | 1,833 | 441 | 3,166 | 510 | 17 | ||||||||||||||||||||||||||||||
Class R Shares | 339 | 107 | 26 | N/A | 30 | 53 | 28 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | 2,875 | 2,080 | 858 | – | 240 | 302 | 117 | 82 | 46 | 8 | ||||||||||||||||||||||||||||||
Class T Shares | 35,293 | 27,379 | 37,151 | – | 28,676 | 42,793 | 66,465 | 36,284 | 26,270 | 18,905 | ||||||||||||||||||||||||||||||
Shares Repurchased | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (91,966) | (66,349) | (65,835) | – | (20,790) | (28,650) | (13,009) | (47,535) | (25,340) | (1,492) | ||||||||||||||||||||||||||||||
Class C Shares | (37,879) | (35,877) | (13,725) | – | (9,540) | (15,111) | (5,010) | (10,538) | (5,388) | (409) | ||||||||||||||||||||||||||||||
Class D Shares | (91,378) | (44,865) | N/A | – | (22,379) | (35,156) | N/A | (37,420) | (40,679) | N/A | ||||||||||||||||||||||||||||||
Class I Shares | (144,403) | (130,104) | (11,062) | (6) | (22,158) | (14,528) | (6,688) | (72,184) | (49,343) | (1,535) | ||||||||||||||||||||||||||||||
Class R Shares | (2,118) | (1,233) | (367) | N/A | (326) | (967) | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (14,891) | (43,602) | (17,691) | – | (1,301) | (3,197) | (1,170) | (1,882) | (4,317) | (2,318) | ||||||||||||||||||||||||||||||
Class T Shares | (202,457) | (207,784) | (277,166) | – | (128,042) | (258,347) | (148,029) | (612,257) | (417,066) | (335,458) | ||||||||||||||||||||||||||||||
Shares Reorganized in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||
Class T Shares | N/A | (612,047) | N/A | N/A | N/A | (251,932) | N/A | N/A | (233,703) | N/A | ||||||||||||||||||||||||||||||
Net Increase from Capital Share Transactions | 586,318 | 631,981 | 1,105,432 | 10,015 | 275,657 | 135,635 | 546,420 | 94,693 | 1,174,763 | 1,084,517 | ||||||||||||||||||||||||||||||
Net Increase in Net Assets | 491,472 | 697,745 | 1,265,101 | 10,013 | 370,570 | 155,893 | 675,625 | 85,781 | 1,190,646 | 1,122,179 | ||||||||||||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||||||||||
Beginning of period | 2,703,389 | 2,005,644 | 740,543 | – | 1,212,808 | 1,056,915 | 381,290 | 2,544,648 | 1,354,002 | 231,823 | ||||||||||||||||||||||||||||||
End of period | $ | 3,194,861 | $ | 2,703,389 | $ | 2,005,644 | $ | 10,013 | $ | 1,583,378 | $ | 1,212,808 | $ | 1,056,915 | $ | 2,630,429 | $ | 2,544,648 | $ | 1,354,002 | ||||||||||||||||||||
Undistributed Net Investment Income/(Loss)* | $ | 886 | $ | 871 | $ | 1,171 | $ | (2) | $ | 2,247 | $ | 1,008 | $ | 445 | $ | 612 | $ | (91) | $ | 152 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
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Financial Highlights - Fixed Income Funds
Class A Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Flexible Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.41 | $9.97 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .19 | .28 | .14 | |||||||||||
Net gain on investments (both realized and unrealized) | .05 | .35 | .44 | |||||||||||
Total from Investment Operations | .24 | .63 | .58 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.19) | (.28) | (.14) | |||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | |||||||||||
Total Distributions and Other | (.53) | (.34) | (.14) | |||||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | $10.41 | |||||||||||
Total Return** | 2.26% | 6.16% | 5.87% | |||||||||||
Net Assets, End of Period (in thousands) | $371,813 | $324,085 | $231,112 | |||||||||||
Average Net Assets for the Period (in thousands) | $362,089 | $265,798 | $218,408 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.76% | 0.76% | 0.80% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.76% | 0.76% | 0.80% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 3.40% | 4.04% | 4.28% | |||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% |
Class A Shares
Janus Global | ||||||
For a share outstanding during the | Bond Fund | |||||
period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $833 | |||||
Average Net Assets for the Period (in thousands) | $833 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 2.65% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 2.65% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (2.52)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
70 | DECEMBER 31, 2010
Table of Contents
Class A Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus High-Yield Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.29 | $7.61 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .34 | .47 | .27 | |||||||||||
Net gain on investments (both realized and unrealized) | .63 | .16 | .68 | |||||||||||
Total from Investment Operations | .97 | .63 | .95 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.33) | (.47) | (.27) | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.33) | (.47) | (.27) | |||||||||||
Net Asset Value, End of Period | $9.09 | $8.45 | $8.29 | |||||||||||
Total Return** | 11.64%(3) | 7.66% | 12.63% | |||||||||||
Net Assets, End of Period (in thousands) | $142,386 | $109,096 | $84,972 | |||||||||||
Average Net Assets for the Period (in thousands) | $124,997 | $98,784 | $75,369 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.94% | 0.92% | 0.96% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.94% | 0.92% | 0.96% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.51% | 8.30% | 10.07% | |||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% |
Class A Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Short-Term Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $3.09 | $3.06 | $3.01 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .03 | .05 | .04 | |||||||||||
Net gain on investments (both realized and unrealized) | .01 | .03 | .05 | |||||||||||
Total from Investment Operations | .04 | .08 | .09 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.03) | (.05) | (.04) | |||||||||||
Distributions (from capital gains)* | (.02) | – | – | |||||||||||
Total Distributions and Other | (.05) | (.05) | (.04) | |||||||||||
Net Asset Value, End of Period | $3.08 | $3.09 | $3.06 | |||||||||||
Total Return** | 1.53% | 2.65% | 3.05% | |||||||||||
Net Assets, End of Period (in thousands) | $133,482 | $121,254 | $43,636 | |||||||||||
Average Net Assets for the Period (in thousands) | $134,119 | $82,728 | $18,271 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.80% | 0.80% | 0.82% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.80% | 0.80% | 0.81% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.08% | 2.39% | 2.78% | |||||||||||
Portfolio Turnover Rate*** | 129% | 50% | 57% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Impact on performance due to reimbursement from advisor was 0.49%. See Note 4 in Notes to Financial Statements. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 71
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Financial Highlights - Fixed Income Funds (continued)
Class C Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended | Janus Flexible Bond Fund | |||||||||||||
June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.41 | $9.97 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .15 | .23 | .12 | |||||||||||
Net gain on investments (both realized and unrealized) | .05 | .35 | .44 | |||||||||||
Total from Investment Operations | .20 | .58 | .56 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.15) | (.23) | (.12) | |||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | |||||||||||
Total Distributions and Other | (.49) | (.29) | (.12) | |||||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | $10.41 | |||||||||||
Total Return** | 1.87% | 5.63% | 5.61% | |||||||||||
Net Assets, End of Period (in thousands) | $270,120 | $236,850 | $161,218 | |||||||||||
Average Net Assets for the Period (in thousands) | $266,678 | $195,825 | $137,244 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.52% | 1.51% | 1.57% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.52% | 1.51% | 1.57% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 2.64% | 3.29% | 3.51% | |||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% |
Class C Shares
Janus Global | �� | |||||
For a share outstanding during the | Bond Fund | |||||
period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $834 | |||||
Average Net Assets for the Period (in thousands) | $833 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 3.21% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 3.21% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (3.09)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
72 | DECEMBER 31, 2010
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Class C Shares
For a share outstanding during | ||||||||||||||
the six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus High-Yield Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.29 | $7.61 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .30 | .43 | .27 | |||||||||||
Net gain on investments (both realized and unrealized) | .65 | .16 | .68 | |||||||||||
Total from Investment Operations | .95 | .59 | .95 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.30) | (.43) | (.27) | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.30) | (.43) | (.27) | |||||||||||
Net Asset Value, End of Period | $9.10 | $8.45 | $8.29 | |||||||||||
Total Return** | 11.33%(3) | 7.14% | 12.36% | |||||||||||
Net Assets, End of Period (in thousands) | $77,062 | $68,485 | $61,744 | |||||||||||
Average Net Assets for the Period (in thousands) | $73,820 | $67,693 | $51,080 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.70% | 1.65% | 1.71% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.70% | 1.65% | 1.71% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 6.75% | 7.59% | 9.27% | |||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% |
Class C Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Short-Term Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $3.08 | $3.06 | $3.01 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .02 | .03 | .05 | |||||||||||
Net gain on investments (both realized and unrealized) | .01 | .02 | .05 | |||||||||||
Total from Investment Operations | .03 | .05 | .10 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.02) | (.03) | (.05) | |||||||||||
Distributions (from capital gains)* | (.02) | – | �� | |||||||||||
Total Distributions and Other | (.04) | (.03) | (.05) | |||||||||||
Net Asset Value, End of Period | $3.07 | $3.08 | $3.06 | |||||||||||
Total Return** | 1.15% | 1.82% | 3.31% | |||||||||||
Net Assets, End of Period (in thousands) | $71,276 | $63,030 | $23,567 | |||||||||||
Average Net Assets for the Period (in thousands) | $70,236 | $42,824 | $8,848 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.55% | 1.55% | 1.57% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.55% | 1.55% | 1.56% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.32% | 1.64% | 2.01% | |||||||||||
Portfolio Turnover Rate*** | 129% | 50% | 57% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Impact on performance due to reimbursement from advisor was 0.48%. See Note 4 in Notes to Financial Statements. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 73
Table of Contents
Financial Highlights - Fixed Income Funds (continued)
Class D Shares
For a share outstanding during the | ||||||||||
six-month period ended December 31, 2010 | Janus Flexible Bond Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.43 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .20 | .16 | ||||||||
Net gain on investments (both realized and unrealized) | .05 | .27 | ||||||||
Total from Investment Operations | .25 | .43 | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.20) | (.16) | ||||||||
Distributions (from capital gains)* | (.34) | – | ||||||||
Total Distributions and Other | (.54) | (.16) | ||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | ||||||||
Total Return** | 2.35% | 4.13% | ||||||||
Net Assets, End of Period (in thousands) | $687,417 | $665,736 | ||||||||
Average Net Assets for the Period (in thousands) | $708,645 | $632,441 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.59% | 0.60% | ||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.59% | 0.60% | ||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 3.57% | 4.09% | ||||||||
Portfolio Turnover Rate*** | 139% | 130% |
Class D Shares
Janus Global | ||||||
For a share outstanding during the | Bond Fund | |||||
period ended December 31, 2010 (unaudited) | 2010(3) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $838 | |||||
Average Net Assets for the Period (in thousands) | $835 | |||||
Ratio of Gross Expenses to Average Net Assets***(2) | 2.55% | |||||
Ratio of Net Expenses to Average Net Assets***(2) | 2.55% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (2.43)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | See Note 6 in Notes to Financial Statements. | |
(3) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
74 | DECEMBER 31, 2010
Table of Contents
Class D Shares
�� | ||||||||||
For a share outstanding during the | ||||||||||
six-month period ended December 31, 2010 | Janus High-Yield Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.27 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .34 | .26 | ||||||||
Net gain on investments (both realized and unrealized) | .64 | .18 | ||||||||
Total from Investment Operations | .98 | .44 | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.34) | (.26) | ||||||||
Distributions (from capital gains)* | – | – | ||||||||
Redemption fees | –(2) | –(2) | ||||||||
Total Distributions and Other | (.34) | (.26) | ||||||||
Net Asset Value, End of Period | $9.09 | $8.45 | ||||||||
Total Return** | 11.73%(3) | 5.31% | ||||||||
Net Assets, End of Period (in thousands) | $294,579 | $247,945 | ||||||||
Average Net Assets for the Period (in thousands) | $274,172 | $245,710 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.79% | 0.77% | ||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.79% | 0.77% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.66% | 8.27% | ||||||||
Portfolio Turnover Rate*** | 97% | 91% |
Class D Shares
For a share outstanding during the | ||||||||||
six-month period ended December 31, 2010 | Janus Short-Term Bond Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $3.09 | $3.08 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .03 | .03 | ||||||||
Net gain on investments (both realized and unrealized) | .01 | .01 | ||||||||
Total from Investment Operations | .04 | .04 | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.03) | (.03) | ||||||||
Distributions (from capital gains)* | (.02) | – | ||||||||
Total Distributions and Other | (.05) | (.03) | ||||||||
Net Asset Value, End of Period | $3.08 | $3.09 | ||||||||
Total Return** | 1.60% | 1.21% | ||||||||
Net Assets, End of Period (in thousands) | $221,840 | $227,147 | ||||||||
Average Net Assets for the Period (in thousands) | $230,680 | $221,604 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.68% | 0.67% | ||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.68% | 0.67% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.19% | 2.42% | ||||||||
Portfolio Turnover Rate*** | 129% | 50% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | Redemption fees aggregated less than $.01 on a per share basis. | |
(3) | Impact on performance due to reimbursement from advisor was 0.49%. See Note 4 in Notes to Financial Statements. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 75
Table of Contents
Financial Highlights - Fixed Income Funds (continued)
Class I Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Flexible Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.41 | $9.97 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .20 | .30 | .15 | |||||||||||
Net gain on investments (both realized and unrealized) | .05 | .35 | .44 | |||||||||||
Total from Investment Operations | .25 | .65 | .59 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.20) | (.30) | (.15) | |||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | |||||||||||
Total Distributions and Other | (.54) | (.36) | (.15) | |||||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | $10.41 | |||||||||||
Total Return** | 2.37% | 6.32% | 5.96% | |||||||||||
Net Assets, End of Period (in thousands) | $1,076,833 | $767,784 | $453,037 | |||||||||||
Average Net Assets for the Period (in thousands) | $983,799 | $609,814 | $202,602 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.55% | 0.55% | 0.48% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.55% | 0.55% | 0.48% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 3.61% | 4.24% | 4.55% | |||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% |
Class I Shares
Janus Global | ||||||
For a share outstanding during | Bond Fund | |||||
the period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $5,842 | |||||
Average Net Assets for the Period (in thousands) | $5,847 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 2.46% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 2.46% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (2.34)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
76 | DECEMBER 31, 2010
Table of Contents
Class I Shares
For a share outstanding during | ||||||||||||||
the six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus High-Yield Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.28 | $7.61 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .35 | .48 | .28 | |||||||||||
Net gain on investments (both realized and unrealized) | .64 | .17 | .67 | |||||||||||
Total from Investment Operations | .99 | .65 | .95 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.34) | (.48) | (.28) | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Redemption fees | –(3) | –(3) | – | |||||||||||
Total Distributions and Other | (.34) | (.48) | (.28) | |||||||||||
Net Asset Value, End of Period | $9.10 | $8.45 | $8.28 | |||||||||||
Total Return** | 11.92%(4) | 7.98% | 12.60% | |||||||||||
Net Assets, End of Period (in thousands) | $197,373 | $73,042 | $22,052 | |||||||||||
Average Net Assets for the Period (in thousands) | $150,943 | $43,060 | $14,845 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 0.68% | 0.64% | 0.66% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 0.68% | 0.64% | 0.66% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.74% | 8.50% | 10.33% | |||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% |
Class I Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Short-Term Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $3.09 | $3.06 | $3.01 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .04 | .06 | .03 | |||||||||||
Net gain on investments (both realized and unrealized) | .01 | .02 | .05 | |||||||||||
Total from Investment Operations | .05 | .08 | .08 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.04) | (.05) | (.03) | |||||||||||
Distributions (from capital gains)* | (.02) | – | – | |||||||||||
Total Distributions and Other | (.06) | (.05) | (.03) | |||||||||||
Net Asset Value, End of Period | $3.08 | $3.09 | $3.06 | |||||||||||
Total Return** | 1.67% | 2.82% | 2.75% | |||||||||||
Net Assets, End of Period (in thousands) | $319,673 | $171,201 | $69,785 | |||||||||||
Average Net Assets for the Period (in thousands) | $235,970 | $115,010 | $8,399 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 0.55% | 0.55% | 0.59% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 0.55% | 0.55% | 0.57% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.34% | 2.64% | 2.85% | |||||||||||
Portfolio Turnover Rate*** | 129% | 50% | 57% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Redemption fees aggregated less than $.01 on a per share basis. | |
(4) | Impact on performance due to reimbursement from advisor was 0.49%. See Note 4 in Notes to Financial Statements. | |
(5) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 77
Table of Contents
Financial Highlights - Fixed Income Funds (continued)
Class R Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Flexible Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.42 | $9.97 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .16 | .25 | .13 | |||||||||||
Net gain on investments (both realized and unrealized) | .05 | .34 | .45 | |||||||||||
Total from Investment Operations | .21 | .59 | .58 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.16) | (.25) | (.13) | |||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | |||||||||||
Total Distributions and Other | (.50) | (.31) | (.13) | |||||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | $10.42 | |||||||||||
Total Return** | 2.03% | 5.76% | 5.81% | |||||||||||
Net Assets, End of Period (in thousands) | $7,837 | $5,582 | $3,120 | |||||||||||
Average Net Assets for the Period (in thousands) | $7,578 | $4,675 | $2,700 | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.21% | 1.20% | 1.24% | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.21% | 1.20% | 1.25% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.95% | 3.59% | 3.83% | |||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% |
Class R Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus High-Yield Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.28 | $7.61 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .32 | .45 | .26 | |||||||||||
Net gain on investments (both realized and unrealized) | .63 | .17 | .67 | |||||||||||
Total from Investment Operations | .95 | .62 | .93 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.31) | (.45) | (.26) | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Redemption fees | –(4) | – | – | |||||||||||
Total Distributions and Other | (.31) | (.45) | (.26) | |||||||||||
Net Asset Value, End of Period | $9.09 | $8.45 | $8.28 | |||||||||||
Total Return** | 11.38%(5) | 7.46% | 12.33% | |||||||||||
Net Assets, End of Period (in thousands) | $895 | $876 | $959 | |||||||||||
Average Net Assets for the Period (in thousands) | $1,008 | $1,095 | $885 | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.40% | 1.37% | 1.41% | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.40% | 1.37% | 1.41% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.05% | 7.88% | 9.83% | |||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Redemption fees aggregated less than $.01 on a per share basis. | |
(5) | Impact on performance due to reimbursement from advisor was 0.49%. See Note 4 in Notes to Financial Statements. |
See Notes to Financial Statements.
78 | DECEMBER 31, 2010
Table of Contents
Class S Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Flexible Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.71 | $10.42 | $9.97 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .18 | .27 | .14 | |||||||||||
Net gain on investments (both realized and unrealized) | .05 | .35 | .45 | |||||||||||
Total from Investment Operations | .23 | .62 | .59 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.18) | (.27) | (.14) | |||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | |||||||||||
Total Distributions and Other | (.52) | (.33) | (.14) | |||||||||||
Net Asset Value, End of Period | $10.42 | $10.71 | $10.42 | |||||||||||
Total Return** | 2.17% | 6.04% | 5.89% | |||||||||||
Net Assets, End of Period (in thousands) | $57,563 | $61,541 | $70,553 | |||||||||||
Average Net Assets for the Period (in thousands) | $63,654 | $66,480 | $67,591 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.95% | 0.95% | 0.99% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.95% | 0.95% | 0.99% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 3.21% | 3.87% | 4.10% | |||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% |
Class S Shares
Janus Global | ||||||
For a share outstanding during the | Bond Fund | |||||
period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $833 | |||||
Average Net Assets for the Period (in thousands) | $833 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 2.83% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 2.83% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (2.71)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 79
Table of Contents
Financial Highlights - Fixed Income Funds (continued)
Class S Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus High-Yield Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $8.47 | $8.29 | $7.61 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .33 | .46 | .27 | |||||||||||
Net gain on investments (both realized and unrealized) | .63 | .17 | .67 | |||||||||||
Total from Investment Operations | .96 | .63 | .94 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.32) | (.45) | (.27) | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Redemption fees | –(3) | –(3) | .01 | |||||||||||
Total Distributions and Other | (.32) | (.45) | (.26) | |||||||||||
Net Asset Value, End of Period | $9.11 | $8.47 | $8.29 | |||||||||||
Total Return** | 11.51%(4) | 7.77% | 12.55% | |||||||||||
Net Assets, End of Period (in thousands) | $7,588 | $6,354 | $5,841 | |||||||||||
Average Net Assets for the Period (in thousands) | $6,684 | $6,774 | $5,037 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 1.15% | 1.12% | 1.18% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 1.15% | 1.12% | 1.18% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.31% | 8.12% | 9.82% | |||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% |
Class S Shares
For a share outstanding during the | ||||||||||||||
six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 | Janus Short-Term Bond Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $3.08 | $3.06 | $3.01 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .03 | .04 | .03 | |||||||||||
Net gain on investments (both realized and unrealized) | .01 | .03 | .05 | |||||||||||
Total from Investment Operations | .04 | .07 | .08 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.03) | (.05) | (.03) | |||||||||||
Distributions (from capital gains)* | (.02) | – | – | |||||||||||
Total Distributions and Other | (.05) | (.05) | (.03) | |||||||||||
Net Asset Value, End of Period | $3.07 | $3.08 | $3.06 | |||||||||||
Total Return** | 1.40% | 2.16% | 2.62% | |||||||||||
Net Assets, End of Period (in thousands) | $5,352 | $5,145 | $4,549 | |||||||||||
Average Net Assets for the Period (in thousands) | $4,894 | $4,928 | $2,543 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(5) | 1.05% | 1.05% | 1.07% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(5) | 1.05% | 1.05% | 1.06% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.82% | 2.20% | 2.59% | |||||||||||
Portfolio Turnover Rate*** | 129% | 50% | 57% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Redemption fees aggregated less than $.01 on a per share basis. | |
(4) | Impact on performance due to reimbursement from advisor was 0.48%. See Note 4 in Notes to Financial Statements. | |
(5) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
80 | DECEMBER 31, 2010
Table of Contents
Class T Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the | ||||||||||||||||||||||||||||||
eight-month fiscal period ended June 30, 2010 | Janus Flexible Bond Fund | |||||||||||||||||||||||||||||
and each fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.70 | $10.42 | $9.09 | $9.45 | $9.42 | $9.41 | $9.76 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .19 | .29 | .43 | .42 | .46 | .42 | .40 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | .05 | .34 | 1.33 | (.36) | .02 | .02 | (.34) | |||||||||||||||||||||||
Total from Investment Operations | .24 | .63 | 1.76 | .06 | .48 | .44 | .06 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.19) | (.29) | (.43) | (.42) | (.45) | (.43) | (.41) | |||||||||||||||||||||||
Distributions (from capital gains)* | (.34) | (.06) | – | – | – | – | – | |||||||||||||||||||||||
Total Distributions and Other | (.53) | (.35) | (.43) | (.42) | (.45) | (.43) | (.41) | |||||||||||||||||||||||
Net Asset Value, End of Period | $10.41 | $10.70 | $10.42 | $9.09 | $9.45 | $9.42 | $9.41 | |||||||||||||||||||||||
Total Return** | 2.29% | 6.13% | 19.74% | 0.50% | 5.27% | 4.80% | 0.60% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $723,278 | $641,811 | $1,086,604 | $740,543 | $759,576 | $766,863 | $935,168 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $724,183 | $831,851 | $915,900 | $855,399 | $755,593 | $827,407 | $1,037,336 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.71% | 0.66% | 0.73% | 0.78% | 0.80% | 0.83% | 0.78% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.71% | 0.66% | 0.73% | 0.77% | 0.80% | 0.82% | 0.77% | |||||||||||||||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 3.46% | 4.19% | 4.34% | 4.32% | 4.81% | 4.37% | 4.01% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 139% | 130% | 215% | 185% | 140%(3) | 144%(3) | 174%(3) |
Class T Shares
Janus Global | ||||||
For a share outstanding during the | Bond Fund | |||||
period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | – | |||||
Net gain/(loss) on investments (both realized and unrealized) | – | |||||
Total from Investment Operations | – | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | – | |||||
Distributions (from capital gains)* | – | |||||
Total Distributions and Other | – | |||||
Net Asset Value, End of Period | $10.00 | |||||
Total Return** | 0.00% | |||||
Net Assets, End of Period (in thousands) | $833 | |||||
Average Net Assets for the Period (in thousands) | $833 | |||||
Ratio of Gross Expenses to Average Net Assets***(2) | 2.65% | |||||
Ratio of Net Expenses to Average Net Assets***(2) | 2.65% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (2.52)% | |||||
Portfolio Turnover Rate*** | 0% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | See Note 6 in Notes to Financial Statements. | |
(3) | Excluding mortgage dollar roll transactions. If mortgage dollar roll transactions had been included, the portfolio turnover rate would have been 141% in 2007, 147% in 2006 and 180% in 2005. | |
(4) | Period from December 28, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 81
Table of Contents
Financial Highlights - Fixed Income Funds (continued)
Class T Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the eight-month | ||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and each fiscal year | Janus High-Yield Fund | |||||||||||||||||||||||||||||
ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $8.45 | $8.28 | $6.94 | $9.53 | $9.69 | $9.48 | $9.86 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .34 | .47 | .93 | .73 | .73 | .71 | .65 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | .63 | .17 | 1.34 | (2.59) | (.16) | .20 | (.38) | |||||||||||||||||||||||
Total from Investment Operations | .97 | .64 | 2.27 | (1.86) | .57 | .91 | .27 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.33) | (.47) | (.93) | (.73) | (.73) | (.70) | (.65) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | |||||||||||||||||||||||
Redemption fees | –(2) | –(2) | –(2) | –(2) | –(2) | –(2) | –(2) | |||||||||||||||||||||||
Total Distributions and Other | (.33) | (.47) | (.93) | (.73) | (.73) | (.70) | (.65) | |||||||||||||||||||||||
Net Asset Value, End of Period | $9.09 | $8.45 | $8.28 | $6.94 | $9.53 | $9.69 | $9.48 | |||||||||||||||||||||||
Total Return** | 11.67%(3) | 7.83% | 35.34% | (20.74)% | 6.04% | 10.00% | 2.76% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $863,495 | $707,010 | $881,347 | $381,290 | $591,876 | $511,619 | $523,183 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $790,693 | $819,927 | $574,291 | $510,868 | $579,507 | $490,849 | $548,993 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.90% | 0.86% | 0.89% | 0.90% | 0.87% | 0.91% | 0.88% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.90% | 0.86% | 0.89% | 0.89% | 0.86% | 0.90% | 0.87% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 7.55% | 8.42% | 12.44% | 8.26% | 7.54% | 7.37% | 6.65% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 97% | 91% | 97% | 109% | 114% | 119% | 102% |
Class T Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the | ||||||||||||||||||||||||||||||
eight-month fiscal period ended June 30, 2010 | Janus Short-Term Bond Fund | |||||||||||||||||||||||||||||
and each fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $3.09 | $3.06 | $2.87 | $2.88 | $2.88 | $2.87 | $2.94 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .03 | .05 | .10 | .10 | .13 | .11 | .08 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | .01 | .03 | .19 | (.01) | – | .01 | (.06) | |||||||||||||||||||||||
Total from Investment Operations | .04 | .08 | .29 | .09 | .13 | .12 | .02 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.03) | (.05) | (.10) | (.10) | (.13) | (.11) | (.08) | |||||||||||||||||||||||
Distributions (from capital gains)* | (.02) | – | – | – | – | – | (.01) | |||||||||||||||||||||||
Total Distributions and Other | (.05) | (.05) | (.10) | (.10) | (.13) | (.11) | (.09) | |||||||||||||||||||||||
Net Asset Value, End of Period | $3.08 | $3.09 | $3.06 | $2.87 | $2.88 | $2.88 | $2.87 | |||||||||||||||||||||||
Total Return** | 1.53% | 2.68% | 10.35% | 3.24% | 4.74% | 4.08% | 0.65% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $1,878,806 | $1,956,871 | $1,212,465 | $231,823 | $172,642 | $175,258 | $201,493 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $2,031,492 | $1,637,559 | $588,441 | $193,360 | $172,326 | $182,285 | $233,536 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.80% | 0.79% | 0.72% | 0.65% | 0.65% | 0.65% | 0.65% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.80% | 0.79% | 0.72% | 0.64% | 0.64% | 0.64% | 0.64% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 2.14% | 2.44% | 3.46% | 3.51% | 4.63% | 3.65% | 2.75% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 129% | 50% | 57% | 127% | 130% | 120% | 97% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Redemption fees aggregated less than $.01 on a per share basis. | |
(3) | Impact on performance due to reimbursement from advisor was 0.49%. See Note 4 in Notes to Financial Statements. | |
(4) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
82 | DECEMBER 31, 2010
Table of Contents
Statements of Assets and Liabilities - Money Market Funds
As of December 31, 2010 (unaudited) | Janus Government | Janus Money | ||||||
(all numbers in thousands except net asset value per share) | Money Market Fund | Market Fund | ||||||
Assets: | ||||||||
Investments at cost | $ | 202,538 | $ | 1,309,560 | ||||
Investments at value | $ | 156,038 | $ | 691,960 | ||||
Repurchase agreements | 46,500 | 617,600 | ||||||
Cash | 87 | 113 | ||||||
Receivables: | ||||||||
Fund shares sold | 175 | 3,743 | ||||||
Interest | 23 | 157 | ||||||
Non-interested Trustees’ deferred compensation | 6 | 36 | ||||||
Other assets | 24 | 9 | ||||||
Total Assets | 202,853 | 1,313,618 | ||||||
Liabilities: | ||||||||
Payables: | ||||||||
Fund shares repurchased | 464 | 3,295 | ||||||
Dividends | – | 46 | ||||||
Advisory fees | 17 | 112 | ||||||
Administrative services fees | 14 | 93 | ||||||
Non-interested Trustees’ fees and expenses | – | 10 | ||||||
Non-interested Trustees’ deferred compensation fees | 6 | 36 | ||||||
Accrued expenses and other payables | 3 | 34 | ||||||
Total Liabilities | 504 | 3,626 | ||||||
Net Assets | $ | 202,349 | $ | 1,309,992 | ||||
Net Assets Consist of: | ||||||||
Capital (par value and paid-in surplus)* | $ | 202,363 | $ | 1,310,023 | ||||
Undistributed net investment loss* | (14) | (32) | ||||||
Undistributed net realized gain from investment transactions* | – | – | ||||||
Unrealized net appreciation of non-interested Trustees’ deferred compensation | – | 1 | ||||||
Total Net Assets | $ | 202,349 | $ | 1,309,992 | ||||
Net Assets - Class D Shares | $ | 198,254 | $ | 1,141,232 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 198,267 | 1,141,258 | ||||||
Net Asset Value Per Share | $ | 1.00 | $ | 1.00 | ||||
Net Assets - Class T Shares | $ | 4,095 | $ | 168,760 | ||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 4,095 | 168,758 | ||||||
Net Asset Value Per Share | $ | 1.00 | $ | 1.00 |
* | See Note 5 in Notes to Financial Statements. | |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 83
Table of Contents
Statements of Operations - Money Market Funds
For the six-month period ended December 31, 2010 (unaudited) | Janus Government | Janus | ||||||
(all numbers in thousands) | Money Market Fund | Money Market Fund | ||||||
Investment Income: | ||||||||
Interest | $ | 262 | $ | 1,773 | ||||
Total Investment Income | 262 | 1,773 | ||||||
Expenses: | ||||||||
Advisory fees | 215 | 1,373 | ||||||
Professional fees | 25 | 41 | ||||||
Non-interested Trustees’ fees and expenses | 5 | 53 | ||||||
Administrative services fees - Class D Shares | 483 | 2,778 | ||||||
Administrative services fees - Class T Shares | 11 | 400 | ||||||
Other expenses | 1 | 14 | ||||||
Total Expenses | 740 | 4,659 | ||||||
Less: Excess Expense Reimbursement | (482) | (2,915) | ||||||
Net Expenses after Expense Reimbursement | 258 | 1,744 | ||||||
Net Investment Income | 4 | 29 | ||||||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||||||
Change in unrealized net appreciation/(depreciation) of non-interested Trustees’ deferred compensation | 1 | 6 | ||||||
Net Gain on Investments | 1 | 6 | ||||||
Net Increase in Net Assets Resulting from Operations | $ | 5 | $ | 35 |
See Notes to Financial Statements.
84 | DECEMBER 31, 2010
Table of Contents
Statements of Changes in Net Assets - Money Market Funds
For the six-month period ended December 31, 2010 | ||||||||||||||||||||||||
(unaudited), the eight-month fiscal period ended | Janus Government | Janus Money | ||||||||||||||||||||||
June 30, 2010 and the fiscal year ended | Money Market Fund | Market Fund | ||||||||||||||||||||||
October 31, 2009 (all numbers in thousands) | 2010 | 2010(1) | 2009 | 2010 | 2010(1) | 2009 | ||||||||||||||||||
Operations: | ||||||||||||||||||||||||
Net investment income | $ | 4 | $ | 6 | $ | 272 | $ | 29 | $ | 49 | $ | 3,520 | ||||||||||||
Net realized gain from investment transactions | – | – | 16 | – | – | 1 | ||||||||||||||||||
Change in unrealized net appreciation/(depreciation) of non-interested Trustees’ deferred compensation | 1 | – | (4) | 6 | 1 | (24) | ||||||||||||||||||
Net Increase in Net Assets Resulting from Operations | 5 | 6 | 284 | 35 | 50 | 3,497 | ||||||||||||||||||
Dividends and Distributions to Shareholders: | ||||||||||||||||||||||||
Net Investment Income* | ||||||||||||||||||||||||
Class D Shares | (5) | (14) | N/A | (31) | (23) | N/A | ||||||||||||||||||
Class T Shares | – | (4) | (250) | (6) | (29) | (3,458) | ||||||||||||||||||
Net Realized Gain/(Loss) from Investment Transactions* | ||||||||||||||||||||||||
Class D Shares | – | (15) | N/A | – | – | N/A | ||||||||||||||||||
Class T Shares | – | – | – | – | – | – | ||||||||||||||||||
Net Decrease from Dividends and Distributions | (5) | (33) | (250) | (37) | (52) | (3,458) | ||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||
Shares Sold | ||||||||||||||||||||||||
Class D Shares | 38,054 | 37,208 | N/A | 254,346 | 260,519 | N/A | ||||||||||||||||||
Class T Shares | 1,577 | 22,515 | 102,392 | 44,345 | 218,348 | 697,726 | ||||||||||||||||||
Shares Issued in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||
Class D Shares | N/A | 214,975 | N/A | N/A | 1,291,072 | N/A | ||||||||||||||||||
Reinvested Dividends and Distributions | ||||||||||||||||||||||||
Class D Shares | 5 | 29 | N/A | 32 | 21 | N/A | ||||||||||||||||||
Class T Shares | 4 | 3 | 242 | 32 | 18 | 3,101 | ||||||||||||||||||
Shares Repurchased | ||||||||||||||||||||||||
Class D Shares | (51,551) | (40,409) | N/A | (350,133) | (314,631) | N/A | ||||||||||||||||||
Class T Shares | (1,932) | (31,658) | (186,385) | (41,923) | (278,693) | (1,166,589) | ||||||||||||||||||
Shares Reorganized in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||
Class T Shares | N/A | (214,975) | N/A | N/A | (1,291,072) | N/A | ||||||||||||||||||
Net Decrease from Capital Share Transactions | (13,843) | (12,312) | (83,751) | (93,301) | (114,418) | (465,762) | ||||||||||||||||||
Net Decrease in Net Assets | (13,843) | (12,339) | (83,717) | (93,303) | (114,420) | (465,723) | ||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of period | 216,192 | 228,531 | 312,248 | 1,403,295 | 1,517,715 | 1,983,438 | ||||||||||||||||||
End of period | $ | 202,349 | $ | 216,192 | $ | 228,531 | $ | 1,309,992 | $ | 1,403,295 | $ | 1,517,715 | ||||||||||||
Undistributed Net Investment Loss* | $ | (14) | $ | (13) | $ | (1) | $ | (32) | $ | (25) | $ | (22) |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 85
Table of Contents
Financial Highlights - Money Market Funds
Class D Shares
For a share outstanding during | ||||||||||
the six-month period ended December 31, 2010 | Janus Government Money Market Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $1.00 | $1.00 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | – | – | ||||||||
Net gain on investments (both realized and unrealized) | – | – | ||||||||
Total from Investment Operations | – | – | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | – | – | ||||||||
Distributions (from capital gains)* | – | – | ||||||||
Total Distributions and Other | – | – | ||||||||
Net Asset Value, End of Period | $1.00 | $1.00 | ||||||||
Total Return** | 0.00% | 0.01% | ||||||||
Net Assets, End of Period (in thousands) | $198,254 | $211,746 | ||||||||
Average Net Assets for the Period (in thousands) | $208,515 | $209,798 | ||||||||
Ratio of Gross Expenses to Average Net Assets*** | 0.24%(2) | 0.26%(2) | ||||||||
Ratio of Net Expenses to Average Net Assets*** | 0.24% | 0.26% | ||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.00% | (0.03)% |
Class D Shares
For a share outstanding during | ||||||||||
the six-month period ended December 31, 2010 | Janus Money Market Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $1.00 | $1.00 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | – | – | ||||||||
Net gain on investments (both realized and unrealized) | – | – | ||||||||
Total from Investment Operations | – | – | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | – | – | ||||||||
Distributions (from capital gains)* | – | – | ||||||||
Total Distributions and Other | – | – | ||||||||
Net Asset Value, End of Period | $1.00 | $1.00 | ||||||||
Total Return** | 0.00% | 0.00% | ||||||||
Net Assets, End of Period (in thousands) | $1,141,232 | $1,236,987 | ||||||||
Average Net Assets for the Period (in thousands) | $1,196,944 | $1,244,263 | ||||||||
Ratio of Gross Expenses to Average Net Assets*** | 0.25%(3) | 0.24%(3) | ||||||||
Ratio of Net Expenses to Average Net Assets*** | 0.25% | 0.24% | ||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.00% | 0.01% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | The ratio was 0.69% during the six-month period ended December 31, 2010 and 0.68% in 2010 before waiver of certain fees incurred by the Fund. | |
(3) | The ratio was 0.68% during the six-month period ended December 31, 2010 and 0.67% in 2010 before waiver of certain fees incurred by the Fund. |
See Notes to Financial Statements.
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Class T Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the eight-month | ||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and each fiscal year | Janus Government Money Market Fund | |||||||||||||||||||||||||||||
ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | – | .01(2) | – | .02 | .05 | .04 | .02 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | – | (.01)(2) | – | – | – | – | – | |||||||||||||||||||||||
Total from Investment Operations | – | – | – | .02 | .05 | .04 | .02 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | – | – | – | (.02) | (.05) | (.04) | (.02) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | |||||||||||||||||||||||
Total Distributions and Other | – | – | – | (.02) | (.05) | (.04) | (.02) | |||||||||||||||||||||||
Net Asset Value, End of Period | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | |||||||||||||||||||||||
Total Return** | 0.00% | 0.02% | 0.08% | 2.46% | 4.79% | 4.31% | 2.34% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $4,095 | $4,446 | $228,531 | $312,248 | $188,133 | $176,188 | $186,361 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $4,427 | $100,419 | $273,901 | $225,293 | $177,655 | $176,580 | $198,231 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets*** | 0.24%(3) | 0.24%(3) | 0.55%(3) | 0.62%(3) | 0.61%(3) | 0.61%(3) | 0.61%(3) | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets*** | 0.24% | 0.24% | 0.55% | 0.62% | 0.61% | 0.61% | 0.61% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.00% | 0.05% | 0.10% | 2.33% | 4.69% | 4.22% | 2.29% |
Class T Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||
the eight-month fiscal period ended June 30, | Janus Money Market Fund | |||||||||||||||||||||||||||||
2010 and each fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | – | – | – | .03 | .05 | .04 | .02 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | – | – | – | – | – | – | – | |||||||||||||||||||||||
Total from Investment Operations | – | – | – | .03 | .05 | .04 | .02 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | – | – | – | (.03) | (.05) | (.04) | (.02) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | – | – | |||||||||||||||||||||||
Total Distributions and Other | – | – | – | (.03) | (.05) | (.04) | (.02) | |||||||||||||||||||||||
Net Asset Value, End of Period | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | $1.00 | |||||||||||||||||||||||
Total Return** | 0.00% | 0.00% | 0.18% | 2.76% | 4.93% | 4.39% | 2.41% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $168,760 | $166,308 | $1,517,715 | $1,983,438 | $1,721,914 | $1,412,927 | $1,360,997 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $165,133 | $741,343 | $1,785,483 | $1,931,685 | $1,577,950 | $1,362,170 | $1,449,569 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets*** | 0.25%(4) | 0.25%(4) | 0.54%(4) | 0.61%(4) | 0.60%(4) | 0.60%(4) | 0.60%(4) | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets*** | 0.25% | 0.25% | 0.54% | 0.61% | 0.60% | 0.60% | 0.60% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.00% | 0.00% | 0.20% | 2.68% | 4.82% | 4.31% | 2.36% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Due to decreased shares outstanding during the period, amounts shown for a share outstanding do not correspond with the aggregate net investment income and net gain/(loss) on investments. | |
(3) | The ratio was 0.71% during the six-month period ended December 31, 2010, 0.72% in 2010, 0.73% in 2009, 0.72% in 2008, 0.71% in 2007, 0.71% in 2006 and 0.71% in 2005 before waiver of certain fees incurred by the Fund. | |
(4) | The ratio was 0.70% during the six-month period ended December 31, 2010, 0.71% in 2010, 0.73% in 2009, 0.71% in 2008, 0.70% in 2007, 0.70% in 2006 and 0.70% in 2005 before waiver of certain fees incurred by the Fund. |
See Notes to Financial Statements.
Janus Fixed Income & Money Market Funds | 87
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Notes to Schedules of Investments (unaudited)
Barclays Capital 1-3 Year U.S. Government/Credit Index | Composed of all bonds of investment grade with a maturity between one and three years. | |
Barclays Capital Global Aggregate Bond Index | Barclays Capital Global Aggregate Bond Index provides a broad-based measure of the global investment grade fixed-rate debt markets. It is comprised of the U.S. Aggregate, Pan-European Aggregate, and the Asian-Pacific Aggregate Indexes. It also includes a wide range of standard and customized subindices by liquidity constraint, sector, quality and maturity. | |
Barclays Capital Global Aggregate Corporate Bond Index | Barclays Capital Global Aggregate Corporate Bond Index is the corporate component of the Barclays Capital Global Aggregate Bond Index. | |
Barclays Capital U.S. Aggregate Bond Index | An unmanaged market value weighted index for U.S. dollar-denominated investment-grade debt issues, including government, corporate, mortgage-backed, and asset-backed securities with maturities of at least one year. | |
Barclays Capital U.S. Corporate High-Yield Bond Index | Composed of fixed-rate, publicly issued, non-investment grade debt. | |
Lipper High Current Yield Funds | Funds that aim at high (relative) current yield from fixed income securities, have no quality or maturity restrictions, and tend to invest in lower grade debt issues. | |
Lipper Intermediate Investment Grade Debt Funds | Funds that invest at least 65% of their assets in investment grade debt issues (rated in top four grades) with dollar-weighted average maturities of five to ten years. | |
Lipper Short Investment Grade Debt Funds | Funds that invest at least 65% of their assets in investment grade debt issues (rated in top four grades) with dollar-weighted average maturities of less than three years. | |
PIK | Pay-in-kind (PIK) bonds give the issuer an option to make the interest payment in cash or additional securities. | |
PLC | Public Limited Company | |
REIT | Real Estate Investment Trust | |
ULC | Unlimited Liability Company | |
U.S. Shares | Securities of foreign companies trading on an American Stock Exchange. |
(a) | All or a portion of this position has not settled, or is not funded. Upon settlement or funding date, interest rates for unsettled or unfunded amounts will be determined. Interest and dividends will not be accrued until time of settlement or funding. | |
* | Non-income producing security. | |
** | A portion of this security has been segregated by the custodian to cover margin or segregation requirements on open futures contracts, forward currency contracts, options contracts, short sales, swap agreements, and/or securities with extended settlement dates. | |
‡ | Rate is subject to change. Rate shown reflects current rate. | |
ß | Security is illiquid. | |
ÇÇ | Security is a U.S. Treasury Inflation-Protected Security (TIPS). |
°° ∞ Schedule of Fair Valued Securities (as of December 31, 2010)
Value as a | |||||||
Value | % of Net Assets | ||||||
Janus High-Yield Fund | |||||||
Visteon Corp. (144A) | $ | 15,933,033 | 1.0% | ||||
Securities are valued at “fair value” pursuant to procedures adopted by the Funds’ trustees. The Schedule of Fair Valued Securities does not include international equity securities fair valued pursuant to a systematic fair valuation model.
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§ Schedule of Restricted and Illiquid Securities (as of December 31, 2010)
Acquisition | Acquisition | Value as a | ||||||||||
Date | Cost | Value | % of Net Assets | |||||||||
Janus High-Yield Fund | ||||||||||||
Dole Food Automatic Exchange, 7.0000% | 10/22/09 | $ | 4,515,188 | $ | 4,616,761 | 0.3% | ||||||
Visteon Corp. (144A) | 10/8/10 | 12,722,535 | 15,933,033 | 1.0% | ||||||||
$ | 17,237,723 | $ | 20,549,794 | 1.3% | ||||||||
The Fund has registration rights for certain restricted securities held as of December 31, 2010. The issuer incurs all registration costs.
144A | Securities sold under Rule 144A of the Securities Act of 1933, as amended, are subject to legal and/or contractual restrictions on resale and may not be publicly sold without registration under the 1933 Act. These securities have been determined to be liquid under guidelines established by the Board of Trustees. The total value of 144A securities as of the period ended December 31, 2010 is indicated in the table below: |
Value as a % | ||||||||||
Fund | Value | of Net Assets | ||||||||
Fixed Income | ||||||||||
Janus Flexible Bond Fund | $ | 297,303,096 | 9.3 | % | ||||||
Janus High-Yield Fund | 629,545,603 | 39.8 | % | |||||||
Janus Short-Term Bond Fund | 362,027,648 | 13.8 | % | |||||||
The following is a summary of the inputs that were used to value the Funds’ investments in securities and other financial instruments as of December 31, 2010. See Notes to Financial Statements for more information.
Valuation Inputs Summary (as of December 31, 2010)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Janus Flexible Bond Fund | |||||||||||
Bank Loans | $ | – | $ | 70,333,218 | $ | – | |||||
Corporate Bonds | – | 2,199,057,648 | $ | – | |||||||
Preferred Stock | – | 4,097,720 | – | ||||||||
Short-Term Taxable Variable Rate Demand Note | – | 7,545,194 | – | ||||||||
U.S. Treasury Notes/Bonds | – | 872,029,142 | – | ||||||||
Money Market | – | 23,932,620 | – | ||||||||
Total Investments in Securities | $ | – | $ | 3,176,995,542 | $ | – | |||||
Investments in Securities: | |||||||||||
Janus Global Bond Fund | |||||||||||
Money Market | $ | – | $ | 10,009,000 | $ | – | |||||
Total Investments in Securities | $ | – | $ | 10,009,000 | $ | – | |||||
Investments in Securities: | |||||||||||
Janus High-Yield Fund | |||||||||||
Bank Loans | $ | – | $ | 61,768,107 | $ | – | |||||
Common Stock | |||||||||||
Automotive – Truck Parts and Equipment – Original | 1,196,836 | – | 15,933,033 | ||||||||
All Other | 36,185,972 | – | – | ||||||||
Corporate Bonds | – | 1,350,470,006 | – | ||||||||
Preferred Stock | – | 8,398,289 | – | ||||||||
Warrant | – | 4,400,359 | – | ||||||||
Money Market | – | 76,903,466 | – | ||||||||
Total Investments in Securities | $ | 37,382,808 | $ | 1,501,940,227 | $ | 15,933,033 | |||||
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Notes to Schedules of Investments (unaudited) (continued)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Janus Short-Term Bond Fund | |||||||||||
Bank Loans | $ | – | $ | 75,825,300 | $ | – | |||||
Corporate Bonds | – | 1,987,542,478 | – | ||||||||
U.S. Treasury Notes/Bonds | – | 584,462,309 | – | ||||||||
Short-Term Taxable Variable Rate Demand Note | – | 1,135,000 | – | ||||||||
Money Market | – | 3,507,278 | – | ||||||||
Total Investments in Securities | $ | – | $ | 2,652,472,365 | $ | – | |||||
Investments in Securities: | |||||||||||
Janus Government Money Market Fund | |||||||||||
Repurchase Agreements | $ | – | $ | 46,500,000 | $ | – | |||||
U.S. Government Agency Notes | – | 72,117,840 | – | ||||||||
Variable Rate Demand Notes | – | 83,920,000 | – | ||||||||
Total Investments in Securities | $ | – | $ | 202,537,840 | $ | – | |||||
Investments in Securities: | |||||||||||
Janus Money Market Fund | |||||||||||
Certificates of Deposit | $ | – | $ | 140,003,328 | $ | – | |||||
Floating Rate Note | – | 30,000,000 | – | ||||||||
Repurchase Agreements | – | 617,600,000 | – | ||||||||
U.S. Government Agency Notes | – | 335,811,337 | – | ||||||||
Variable Rate Demand Notes | – | 186,145,000 | – | ||||||||
Total Investments in Securities | $ | – | $ | 1,309,559,665 | $ | – | |||||
Other Financial Instruments(a): | |||||||||||
Janus Short-Term Bond Fund | $ | (113,750) | $ | – | $ | – | |||||
(a) | Other financial instruments include futures, forward currency, written option, and swap contracts. Forward currency contracts and swap contracts are reported at their unrealized appreciation/(depreciation) at measurement date, which represents the change in the contract’s value from trade date. Futures are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. Options are reported at their market value at measurement date. |
Level 3 Valuation Reconciliation of Assets (for the period ended December 31, 2010)
Change in | Transfers In | ||||||||||||||||||||||
Accrued | Unrealized | Net | and/or | ||||||||||||||||||||
Balance as of | Discounts/ | Realized | Appreciation/ | Purchases/ | Out of | Balance as of | |||||||||||||||||
June 30, 2010 | Premiums | Gain/(Loss)(a) | (Depreciation)(b) | (Sales) | Level 3 | December 31, 2010 | |||||||||||||||||
Investments in Securities: | |||||||||||||||||||||||
Janus High-Yield Fund | |||||||||||||||||||||||
Common Stock | |||||||||||||||||||||||
Automotive – Truck Parts and Equipment – Original | $ | – | $ | – | $ | – | $ | – | $ | 15,933,033 | $ | – | $ | 15,933,033 | |||||||||
(a) | Included in “Net realized gain/(loss) from investment and foreign currency transactions” on the Statements of Operations. | |
(b) | Included in “Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” on the Statements of Operations. |
Aggregate collateral segregated to cover margin or segregation requirements on open futures contracts, forward currency contracts, options contracts, short sales, swap agreements, and/or securities with extended settlement dates as of December 31, 2010 is noted below.
Fund | Aggregate Value | ||||
Fixed Income | |||||
Janus Flexible Bond Fund | $ | 18,620,154 | |||
Janus High-Yield Fund | 53,589,700 | ||||
Janus Short-Term Bond Fund | 75,508,000 | ||||
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The interest rate on floating rate notes is based on an index or market interest rates and is subject to change. Rates in the security description are as of December 31, 2010.
Money market funds may hold securities with stated maturities of greater than 397 days when those securities have features that allow a fund to “put” back the security to the issuer or to a third party within 397 days of acquisition. The maturity dates shown in the security descriptions are the stated maturity dates.
Repurchase agreements held by a Fund are fully collateralized, and such collateral is in the possession of the Fund’s custodian or, for tri-party agreements, the custodian designated by the agreement. The collateral is evaluated daily to ensure its market value exceeds the current market value of the repurchase agreements, including accrued interest. In the event of default on the obligation to repurchase, the Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. In the event of default or bankruptcy by the other party to the agreement, realization and/or retention of the collateral or proceeds may be subject to legal proceedings.
Janus Fixed Income & Money Market Funds | 91
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Notes to Financial Statements (unaudited)
The following section describes the organization and significant accounting policies and provides more detailed information about the schedules and tables that appear throughout this report. In addition, the Notes to Financial Statements explain the methods used in preparing and presenting this report.
1. | Organization and Significant Accounting Policies |
Janus Flexible Bond Fund, Janus Global Bond Fund, Janus High-Yield Fund and Janus Short-Term Bond Fund (collectively, the “Fixed Income Funds”) and Janus Money Market Fund and Janus Government Money Market Fund (collectively, the “Money Market Funds”) are series funds. The Fixed Income Funds and the Money Market Funds (collectively, the “Funds” and individually, a “Fund”) are part of Janus Investment Fund (the “Trust”), which is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The financial statements include information for the period from December 28, 2010 (inception date) through December 31, 2010 for Janus Global Bond Fund and for the six-month period ended December 31, 2010 for Janus Flexible Bond Fund, Janus High-Yield Fund, Janus Short-Term Bond Fund, Janus Money Market Fund, and Janus Government Money Market Fund. The Trust offers forty funds which include multiple series of shares, with differing investment objectives and policies. The Fixed Income Funds invest primarily in income-producing securities. The Money Market Funds invest primarily in short-term money market securities. Each Fixed Income Fund in this report is classified as diversified, as defined in the 1940 Act.
Each Fixed Income Fund in this report offers multiple classes of shares in order to meet the needs of various types of investors. Each Money Market Fund offers only Class D Shares and Class T Shares. Each class represents an interest in the same portfolio of investments. Certain financial intermediaries may not offer all classes of shares.
Class A Shares and Class C Shares are generally offered through financial intermediary platforms including, but not limited to, traditional brokerage platforms, mutual fund wrap fee programs, bank trust platforms, and retirement platforms. The maximum purchase in Class C Shares is $500,000 for any single purchase.
Class D Shares are generally no longer being made available to new investors who do not already have a direct account with the Janus funds. The Shares are available only to investors who held accounts directly with the Janus funds as of July 6, 2009 and to immediate family members or members of the same household of an eligible individual investor. The Shares are not offered through financial intermediaries.
Class I Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, and bank trust platforms, as well as certain retirement platforms. Class I Shares are also available to certain institutional investors including, but not limited to, corporations, certain retirement plans, public plans, and foundations/endowments.
Class R Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms.
Class S Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms and asset allocation, mutual fund wrap, or other discretionary or nondiscretionary fee-based investment advisory programs. In addition, Class S Shares may be available through certain financial intermediaries who have an agreement with Janus Capital Management LLC (“Janus Capital”) or its affiliates to offer Class S Shares on their supermarket platforms.
Class T Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, bank trust platforms, and certain retirement platforms. In addition, Class T Shares may be available through certain financial intermediaries who have an agreement with Janus Capital or its affiliates to offer Class T Shares on their supermarket platforms.
The following accounting policies have been followed by the Funds and are in conformity with accounting principles generally accepted in the United States of America within the investment management industry.
Investment Valuation
Securities are valued at the last sales price or the official closing price for securities traded on a principal securities exchange (U.S. or foreign) and on the NASDAQ National Market. Securities traded on over-the-counter (“OTC”) markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees. Short-term securities with maturities of 60 days or less may be valued at amortized cost, which approximates market value. Investments held by the Money Market Funds are valued utilizing the amortized cost method of valuation permitted in accordance with Rule 2a-7 under the 1940 Act and certain conditions therein. Under the amortized cost method, which does not take into account unrealized capital gains or losses, an instrument is initially valued at
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its cost and thereafter assumes a constant accretion/amortization to maturity of any discount or premium. Debt securities with a remaining maturity of greater than 60 days are valued in accordance with the evaluated bid price supplied by the pricing service. The evaluated bid price supplied by the pricing service is an evaluation that reflects such factors as security prices, yields, maturities and ratings. Short positions shall be valued in accordance with the same methodologies, except that in the event that a last sale price is not available, the latest ask price shall be used instead of a bid price. Foreign securities and currencies are converted to U.S. dollars using the applicable exchange rate in effect as of the daily close of the New York Stock Exchange (“NYSE”). When market quotations are not readily available or deemed unreliable, or events or circumstances that may affect the value of portfolio securities held by the Funds are identified between the closing of their principal markets and the time the net asset value (“NAV”) is determined, securities may be valued at fair value as determined in good faith under procedures established by and under the supervision of the Funds’ Trustees. Circumstances in which fair value pricing may be utilized include, but are not limited to: (i) a significant event that may affect the securities of a single issuer, such as a merger, bankruptcy, or significant issuer specific development; (ii) an event that may affect an entire market, such as a natural disaster or significant governmental action; (iii) a nonsignificant event such as a market closing early or not opening, or a security trading halt; and (iv) pricing of a non-valued security and a restricted or non-public security. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. Restricted and illiquid securities are valued in accordance with procedures established by the Funds’ Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded as soon as the Trust is informed of the dividend, if such information is obtained subsequent to the ex-dividend date. Dividends from foreign securities may be subject to withholding taxes in foreign jurisdictions. Interest income is recorded on the accrual basis and includes amortization of premiums and accretion of discounts. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes. Income, as well as gains and losses, both realized and unrealized, are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets.
Expenses
Each Fund bears expenses incurred specifically on its behalf, as well as a portion of general expenses, which may be allocated pro rata to each Fund. Each class of shares bears expenses incurred specifically on its behalf and, in addition, each class bears a portion of general expenses, which are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets. Expenses directly attributable to a specific class of shares are charged against the operations of such class.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translations
The Fixed Income Funds do not isolate that portion of the results of operations resulting from the effect of changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held at the date of the financial statements. Net unrealized appreciation or depreciation of investments and foreign currency translations arise from changes in the value of assets and liabilities, including investments in securities held at the date of the financial statements, resulting from changes in the exchange rates and changes in market prices of securities held.
Currency gains and losses are also calculated on payables and receivables that are denominated in foreign currencies. The payables and receivables are generally related to foreign security transactions and income.
Foreign currency-denominated assets and forward currency contracts may involve more risks than domestic transactions, including currency risk, political and economic risk, regulatory risk and equity risk. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of foreign currencies relative to the U.S. dollar.
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Notes to Financial Statements (unaudited) (continued)
Dividend Distributions
Dividends are declared daily and distributed monthly for the Funds. Realized capital gains, if any, are declared and distributed in December. The majority of dividends and net realized capital gains distributions from the Funds will be automatically reinvested into additional shares of that Fund, based on the discretion of the shareholder.
The Fixed Income Funds may make certain investments in real estate investment trusts (“REITs”) which pay dividends to their shareholders based upon funds available from operations. It is quite common for these dividends to exceed the REITs’ taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of capital. If the Funds distribute such amounts, such distributions could constitute a return of capital to shareholders for federal income tax purposes.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial statements, as the Funds intend to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code applicable to regulated investment companies.
In accordance with the Financial Accounting Standards Board (“FASB”) guidance, the Funds adopted the provisions of “Income Taxes.” These provisions require an evaluation of tax positions taken (or expected to be taken) in the course of preparing a Fund’s tax returns to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense on the Statements of Operations.
These provisions require management of the Funds to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of and during the period ended December 31, 2010, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examinations in progress and are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Valuation Inputs Summary
In accordance with FASB guidance, the Funds utilize the “Fair Value Measurements” to define fair value, establish a framework for measuring fair value, and expand disclosure requirements regarding fair value measurements. The Fair Value Measurement Standard does not require new fair value measurements, but is applied to the extent that other accounting pronouncements require or permit fair value measurements. This standard emphasizes that fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. Various inputs are used in determining the value of the Funds’ investments defined pursuant to this standard. These inputs are summarized into three broad levels:
Level 1 – Quoted prices in active markets for identical securities.
Level 2 – Prices determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use in pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others.
Debt securities are valued in accordance with the evaluated bid price supplied by the pricing service and generally categorized as Level 2 in the hierarchy. Securities traded on OTC markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees and are categorized as Level 2 in the hierarchy. Short-term securities with maturities of 60 days or less are valued at amortized cost, which approximates market value and are categorized as Level 2 in the hierarchy. Periodic review and monitoring of the valuation of short-term securities is performed in an effort to ensure that amortized cost approximates market value. Other securities that are categorized as Level 2 in the hierarchy include, but are not limited to, preferred stocks, bank loans, American Depositary Receipts (ADRs), Global Depositary Receipts (GDRs), warrants, swaps, investments in mutual funds, OTC options, and forward contracts. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. These are generally categorized as Level 2 in the hierarchy.
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Level 3 – Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the security and would be based on the best information available under the circumstances.
For restricted equity securities and private placements where observable inputs are limited, assumptions about market activity and risk are used in employing valuation techniques such as the market approach, the income approach, or the cost approach, as defined under the FASB Guidance. These are categorized as Level 3 in the hierarchy.
There have been no significant changes in valuation techniques used in valuing any such positions held by the Funds since the beginning of the fiscal year.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of inputs used as of December 31, 2010 to value the Funds’ investments in securities and other financial instruments is included in the “Valuation Inputs Summary” and “Level 3 Valuation Reconciliation of Assets” (if applicable) in the Notes to Schedules of Investments.
In April 2009, FASB issued “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly,” which provides additional guidance for estimating fair value in accordance with Fair Value Measurements when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. Additionally, it amends the Fair Value Measurement Standard by expanding disclosure requirements for reporting entities surrounding the major categories of assets and liabilities carried at fair value. The required disclosures have been incorporated into the “Valuation Inputs Summary” in the Notes to Schedules of Investments. Management believes applying this guidance does not have a material impact on the financial statements.
The Funds adopted FASB Accounting Standards Update “Fair Value Measurements and Disclosures” (the “Update”). This Update applies to a Fund’s disclosures about transfers in and out of Level 1 and Level 2 of the fair value hierarchy and the reasons for the transfers. Disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy are summarized under the Level 2 and Level 3 categories listed above. There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period.
The Funds recognize transfers between the levels as of the beginning of the fiscal year.
2. | Derivative Instruments |
The Fixed Income Funds may invest in various types of derivatives which may at times result in significant derivative exposure. A derivative is a financial instrument whose performance is derived from the performance of another asset. The Fixed Income Funds may invest in derivative instruments including, but not limited to: futures contracts, put options, call options, options on future contracts, options on foreign currencies, swaps, forward contracts, structured investments, and other equity-linked derivatives. A summary of derivative activity is reflected in the tables at the end of this section.
The Fixed Income Funds may use derivative instruments for hedging (to offset risks associated with an investment, currency exposure, or market conditions) or for speculative (to seek to enhance returns) purposes. When the Fixed Income Funds invest in a derivative for speculative purposes, the Fixed Income Funds will be fully exposed to the risks of loss of that derivative, which may sometimes be greater than the cost of the derivative. The Funds may not use any derivative to gain exposure to an asset or class of assets prohibited by their investment restrictions from purchasing directly. The Funds’ ability to use derivative instruments may also be limited by tax considerations.
Investments in derivatives are generally subject to equity risks that may cause their prices to fluctuate over time. Investments in derivatives may not directly correlate with the price movements of the underlying instrument. As a result, the use of derivatives may expose the Fixed Income Funds to additional risks that they would not be subject to if they invested directly in the securities underlying those derivatives. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case. Derivatives can be volatile and may involve significant risks, including, but not limited to, counterparty risk, credit risk, currency risk, equity risk, index risk, interest rate risk, leverage risk, and liquidity risk.
Derivatives may generally be traded OTC or on an exchange. Derivatives traded OTC, such as structured notes, are agreements that are individually negotiated between parties and can be tailored to meet a purchaser’s needs. OTC derivatives are not guaranteed by a clearing agency and may be subject to increased credit risk.
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Notes to Financial Statements (unaudited) (continued)
In an effort to mitigate credit risk associated with derivatives traded OTC, the Fixed Income Funds may enter into collateral agreements with certain counterparties whereby, subject to certain minimum exposure requirements, a Fixed Income Fund may require the counterparty to post collateral if the Fixed Income Fund has a net aggregate unrealized gain on all OTC derivative contracts with a particular counterparty. There is no guarantee that counterparty exposure is reduced and these arrangements are dependent on Janus Capital’s ability to establish and maintain appropriate systems and trading.
In pursuit of their investment objectives, each Fund may seek to use derivatives to increase or decrease exposure to the following market risk factors:
• | Counterparty Risk – Counterparty risk is the risk that the counterparty or a third party will not fulfill its obligation to a Fund. | |
• | Credit Risk – Credit risk is the risk an issuer will be unable to make principal and interest payments when due, or will default on its obligations. | |
• | Currency Risk – Currency risk is the risk that changes in the exchange rate between currencies will adversely affect the value (in U.S. dollar terms) of an investment. | |
• | Equity Risk – Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market. | |
• | Index Risk – If the derivative is linked to the performance of an index, it will be subject to the risks associated with changes in that index. If the index changes, a Fund could receive lower interest payments or experience a reduction in the value of the derivative to below what the Fund paid. Certain indexed securities, including inverse securities (which move in an opposite direction to the index), may create leverage, to the extent that they increase or decrease in value at a rate that is a multiple of the changes in the applicable index. | |
• | Interest Rate Risk – Interest rate risk is the risk that the value of fixed-income securities will generally decline as prevailing interest rates rise, which may cause a Fund’s NAV to likewise decrease, and vice versa. | |
• | Leverage Risk – Leverage risk is the risk associated with certain types of leveraged investments or trading strategies pursuant to which relatively small market movements may result in large changes in the value of an investment. A Fund creates leverage by using borrowed capital to increase the amount invested, or investing in instruments, including derivatives, where the investment loss can exceed the original amount invested. Certain investments or trading strategies that involve leverage can result in losses that greatly exceed the amount originally invested. | |
• | Liquidity Risk – Liquidity risk is the risk that certain securities may be difficult or impossible to sell at the time that the seller would like or at the price that the seller believes the security is currently worth. |
Equity-Linked Structured Notes
The Fixed Income Funds may invest in equity-linked structured notes. Equity-linked structured notes are derivative securities which are specially designed to combine the characteristics of one or more underlying securities and their equity derivatives in a single note form. The return and/or yield or income component may be based on the performance of the underlying equity securities, an equity index, and/or option positions. Equity-linked structured notes are typically offered in limited transactions by financial institutions in either registered or non-registered form. An investment in equity-linked structured notes creates exposure to the credit risk of the issuing financial institution, as well as to the equity risk of the underlying securities. There is no guaranteed return of principal with these securities and the appreciation potential of these securities may be limited by a maximum payment or call right. In certain cases, equity-linked structured notes may be more volatile and less liquid than less complex securities or other types of fixed-income securities. Such securities may exhibit price behavior that does not correlate with other fixed-income securities.
Forward Foreign Currency Exchange Contracts
A forward foreign currency exchange contract (“forward currency contract”) is a commitment to purchase or sell a foreign currency at a future date at a negotiated rate. The Fixed Income Funds may enter into forward currency contracts for hedging purposes, including, but not limited to, reducing exposure to changes in foreign currency exchange rates on foreign portfolio holdings and locking in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in or exposed to foreign currencies. The Fixed Income Funds may also invest in forward currency contracts for nonhedging purposes such as seeking to enhance returns. The Funds are subject to currency risk in the normal course of pursuing their investment objectives through their investments in forward currency contracts.
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The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing a contract is included in “Net realized gain/(loss) from investment and foreign currency transactions” on the Statements of Operations (if applicable).
Forward currency contracts held by the Fixed Income Funds are fully collateralized by other securities, which are denoted on the accompanying Schedules of Investments (if applicable). The collateral is evaluated daily to ensure its market value equals or exceeds the current market value of the corresponding forward currency contracts. Such collateral is in the possession of the Funds’ custodian.
Futures Contracts
A futures contract is an exchange-traded agreement to take or make delivery of an underlying asset at a specific time in the future for a specific predetermined negotiated price. The Fixed Income Funds may enter into futures contracts to gain exposure to the stock market pending investment of cash balances or to meet liquidity needs. The Funds are subject to interest rate risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in futures contracts. The Funds may also use such derivative instruments to hedge or protect from adverse movements in securities prices, currency rates or interest rates. The use of futures contracts may involve risks such as the possibility of illiquid markets or imperfect correlation between the values of the contracts and the underlying securities, or that the counterparty will fail to perform its obligations.
Futures contracts are marked-to-market daily, and the daily variation margin is recorded as a receivable or payable on the Statements of Assets and Liabilities (if applicable). When a contract is closed, a realized gain or loss is recorded as “Net realized gain/(loss) from futures contracts” on the Statements of Operations (if applicable), equal to the difference between the opening and closing value of the contract. Generally, futures contracts are marked-to-market (i.e., treated as realized and subject to distribution) for federal income tax purposes at fiscal year-end. Securities held by the Fixed Income Funds that are designated as collateral for market value on futures contracts are noted on the Schedules of Investments (if applicable). Such collateral is in the possession of the Funds’ custodian or with the counterparty broker.
With futures, there is minimal counterparty credit risk to the Funds since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Options Contracts
An options contract provides the purchaser with the right, but not the obligation, to buy (call option) or sell (put option) a financial instrument at an agreed upon price. The Fixed Income Funds may purchase or write covered and uncovered put and call options on futures contracts and on portfolio securities for hedging purposes or as a substitute for an investment. The Funds are subject to interest rate risk, liquidity risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in options contracts. The Funds may use options contracts to hedge against changes in interest rates, the values of equities, or foreign currencies. The Fixed Income Funds may utilize American-style and European-style options. An American-style option is an option contract that can be exercised at any time between the time of purchase and the option’s expiration date. A European-style option is an option contract that can only be exercised on the option’s expiration date. The Fixed Income Funds may also purchase or write put and call options on foreign currencies in a manner similar to that in which futures or forward contracts on foreign currencies will be utilized. The Fixed Income Funds may also invest in long-term equity anticipation securities, which are long-term option contracts that can be maintained for a period of up to three years. The Fixed Income Funds generally invest in options to hedge against adverse movements in the value of portfolio holdings.
When an option is written, the Fixed Income Funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. In writing an option, the Funds bear the risk of an unfavorable change in the price of the security underlying the written option. Exercise of an option written by the Fixed Income Funds could result in the Funds buying or selling a security at a price different from the current market value.
When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option are adjusted by the amount of premium received or paid.
The Fixed Income Funds may also purchase and write exchange-listed and OTC put and call options on domestic securities indices, and on foreign securities indices listed on domestic and foreign securities exchanges. Options on securities indices are similar to options on securities except that (1) the expiration cycles of securities index options are monthly, while those of securities options are currently quarterly, and (2) the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a
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Notes to Financial Statements (unaudited) (continued)
securities index gives the holder the right to receive a cash “exercise settlement amount” equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of exercise, multiplied by (b) a fixed “index multiplier.” Receipt of this cash amount will depend upon the closing level of the securities index upon which the option is based being greater than, in the case of a call, or less than, in the case of a put, the exercise price of the index and the exercise price of the option times a specified multiple. The writer of the option is obligated, in return for the premium received, to make delivery of this amount.
Options traded on an exchange are regulated and the terms of the options are standardized. Options traded OTC expose the Fixed Income Funds to counterparty risk in the event that the counterparty does not perform. This risk is mitigated by having a netting arrangement between the Fixed Income Funds and the counterparty and by having the counterparty post collateral to cover the Fixed Income Funds’ exposure to the counterparty.
Holdings of the Fixed Income Funds designated to cover outstanding written options are noted on the Schedules of Investments (if applicable). Options written are reported as a liability on the Statements of Assets and Liabilities as “Options written at value” (if applicable).
Realized gains and losses are reported as “Net realized gain/(loss) from options contracts” on the Statements of Operations (if applicable).
The risk in writing call options is that the Fixed Income Funds give up the opportunity for profit if the market price of the security increases and the options are exercised. The risk in writing put options is that the Fixed Income Funds may incur a loss if the market price of the security decreases and the options are exercised. The risk in buying options is that the Funds pay a premium whether or not the options are exercised. The use of such instruments may involve certain additional risks as a result of unanticipated movements in the market. A lack of correlation between the value of an instrument underlying an option and the asset being hedged, or unexpected adverse price movements, could render the Fixed Income Funds’ hedging strategy unsuccessful. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased or sold. There is no limit to the loss the Fixed Income Funds may recognize due to written call options.
Other Options
In addition to the option strategies described above, the Fixed Income Funds may purchase and sell a variety of options with non-standard payout structures or other features (“exotic options”). Exotic options are traded OTC and typically have price movements that can vary markedly from simple put or call options. The risks associated with exotic options are that they cannot be as easily priced and may be subject to liquidity risk. While some exotic options have fairly active markets, others are mostly thinly traded instruments. Some options are pure two-party transactions and may have no liquidity. The Fixed Income Funds may treat such instruments as illiquid and will limit their investments in such instruments to no more than 15% of a Fund’s net assets, when combined with all other illiquid investments of a Fund. The Fixed Income Funds may use exotic options to the extent that they are consistent with the Funds’ investment objectives and investment policies, and applicable regulations.
The Fixed Income Funds may purchase and sell exotic options that have values which are determined by the correlation of two or more underlying assets. These types of options include, but are not limited to, outperformance options, yield curve options or other spread options.
Swaps
A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The Fixed Income Funds may utilize swap agreements as a means to gain exposure to certain common stocks and/or to “hedge” or protect their portfolios from adverse movements in securities prices or interest rates. The Fixed Income Funds are subject to equity risk and interest rate risk in the normal course of pursuing their investment objectives through investments in swap contracts. Swap agreements entail the risk that a party will default on its payment obligation to a Fund. If the other party to a swap defaults, a Fund would risk the loss of the net amount of the payments that it contractually is entitled to receive. If a Fixed Income Fund utilizes a swap at the wrong time or judges market conditions incorrectly, the swap may result in a loss to the Fund and reduce the Fund’s total return. Swap contracts of the Fixed Income Funds are reported as an asset or liability on the Statements of Assets and Liabilities (if applicable). Realized gains and losses of the Fixed Income Funds are reported in “Net realized gain/(loss) from swap contracts” on the Statements of Operations (if applicable).
Various types of swaps such as credit default (funded and unfunded), dividend, equity, interest rate, and total return swaps are described below.
Credit default swaps are a specific kind of counterparty agreement that allows the transfer of third-party credit risk from one party to the other. The Fixed Income Funds are
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subject to credit risk in the normal course of pursuing their investment objectives through their investments in credit default swap contracts. The Fixed Income Funds may enter into credit default swaps to manage their exposure to the market or certain sectors of the market, to reduce their risk exposure to defaults of corporate and sovereign issuers, or to create exposure to corporate or sovereign issuers to which they are not otherwise exposed. With a credit default swap, one party in the swap is a lender and faces credit risk from a third party, and the counterparty in the credit default swap agrees to insure this risk in exchange for regular periodic payments. The Fixed Income Funds’ maximum risk of loss from counterparty risk, either as protection sellers or as protection buyers (undiscounted), is the notional value of the agreement. The risk is mitigated by having a netting arrangement between the Fixed Income Funds and the counterparty and by posting of collateral by the counterparty to the Funds to cover the Funds’ exposure to the counterparty.
Funded (notional value of contract paid up front) or unfunded (notional value only paid in case of default) credit default swaps are based on an index of credit default swaps (“CDXs”) or other similarly structured products. CDXs are designed to track segments of the credit default swap market and provide investors with exposure to specific reference baskets of issuers of bonds or loans. These instruments have the potential to allow an investor to obtain the same investment exposure as an investor who invests in an individual credit default swap, but with the potential added benefit of diversification. The CDX reference baskets are normally priced daily and rebalanced every six months in conjunction with leading market makers in the credit industry. The liquidity of the market for CDXs is normally subject to liquidity in the secured loan and credit derivatives markets. A Fund is normally only permitted to take long positions in CDXs.
Dividend swap agreements involve an exchange by the parties of their respective commitments to pay or right to receive the changes in a dividend index point. The Funds gain exposure by either paying or receiving an amount in respect of an increase or decrease in the change of the relevant dividend index point based on a notional amount. For example, if a Fund took a long position on a dividend index swap, the Fund would receive payments if the relevant index point increased in value and would be obligated to pay if that index point decreased in value.
Equity swaps involve the exchange by two parties of future cash flow (e.g., one cash flow based on a referenced interest rate and the other based on the performance of stock or a stock index).
Interest rate swaps involve the exchange by two parties of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments).
Total return swaps involve an exchange by two parties in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income it generates and any capital gains over the payment period.
The Fixed Income Funds’ maximum risk of loss for equity swaps, interest rate swaps and total return swaps from counterparty risk or credit risk is the discounted value of the payments to be received from/paid to the counterparty over the contract’s remaining life, to the extent that the amount is positive. The risk is mitigated by having a netting arrangement between the Fixed Income Funds and the counterparty and by the posting of collateral to the Funds to cover the Funds’ exposure to the counterparty.
In accordance with FASB guidance, the Funds adopted the provisions for “Derivatives and Hedging,” which require qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements.
The following tables, grouped by derivative type, provide information about the fair value and location of derivatives within the Statement of Assets and Liabilities as of December 31, 2010.
Fair Value of Derivative Instruments as of December 31, 2010
Derivatives not accounted for as | Asset Derivatives | Liability Derivatives | ||||||||||
hedging instruments | Statement of Assets and Liabilities Location | Fair Value | Statements of Assets and Liabilities Location | Fair Value | ||||||||
Janus Short-Term Bond Fund | ||||||||||||
Futures Contracts(a) | Variation Margin | $ | 113,750 | |||||||||
Total | $ | 113,750 | ||||||||||
(a) | Includes cumulative appreciation/(depreciation) of futures contracts as reported on the Schedule of Investments. Only the current day’s variation margin is reported on the Statement of Assets and Liabilities. |
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Notes to Financial Statements (unaudited) (continued)
The following tables provide information about the effect of derivatives and hedging activities on the Funds’ Statement of Operations for the period ended December 31, 2010.
The effect of Derivative Instruments on the Statements of Operations for the six-month period ended December 31, 2010
Amount of Realized Gain/(Loss) on Derivatives Recognized in Income | ||||||||||||||||||||
Forward Currency | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Contracts | Total | |||||||||||||||
Janus Flexible Bond Fund | ||||||||||||||||||||
Interest Rate Contracts | $ | (55,992 | ) | $ | – | $ | – | $ | – | $ | (55,992 | ) | ||||||||
Total | $ | (55,992 | ) | $ | – | $ | – | $ | – | $ | (55,992 | ) | ||||||||
Change in Unrealized Appreciation/(Depreciation) on Derivatives Recognized in Income | ||||||||||||||||||||
Forward Currency | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Contracts | Total | |||||||||||||||
Janus Short-Term Bond Fund | ||||||||||||||||||||
Interest Rate Contracts | $ | (134,728 | ) | $ | – | $ | – | $ | – | $ | (134,728 | ) | ||||||||
Total | $ | (134,728 | ) | $ | – | $ | – | $ | – | $ | (134,728 | ) | ||||||||
Please see the Funds’ Statements of Operations for the Funds’ “Net Realized and Unrealized Gain/(Loss) on Investments.”
The effect of derivatives on the Statement of Operations are indicative of the Funds’ volumes throughout the period.
3. | Other investments and strategies |
Additional Investment Risk
The Fixed Income Funds may be invested in lower-rated debt securities that have a higher risk of default or loss of value since these securities may be sensitive to economic changes, political changes or adverse developments specific to the issuer.
Unforeseen events in both domestic and international equity and fixed-income markets have resulted, and may continue to result, in an unusually high degree of volatility in the markets, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. These events and the resulting market upheavals may have an adverse effect on the Funds, such as a decline in the value and liquidity of many securities held by the Funds, unusually high and unanticipated levels of redemptions, an increase in portfolio turnover, a decrease in NAV, and an increase in Fund expenses. Such unforeseen events may make it unusually difficult to identify both investment risks and opportunities and could limit or preclude each Fund’s ability to achieve its investment objective. The market’s behavior may at times be unpredictable. Therefore, it is important to understand that the value of your investment may fall, sometimes sharply, and you could lose money.
Further, the recent instability experienced in the financial markets has resulted in the U.S. Government and various other governmental and regulatory entities taking actions to address the financial crisis. These actions include, but are not limited to, the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in July 2010 which is expected to dramatically change the way in which the U.S. financial system is supervised and regulated. More specifically, the Dodd-Frank Act provides for widespread regulation of financial institutions, consumer financial products and services, broker-dealers, over-the-counter derivatives, investment advisers, credit rating agencies, and mortgage lending, which expands federal oversight in the financial sector and may affect the investment management industry as a whole. Given the broad scope, sweeping nature, and the fact that many provisions of the Dodd-Frank Act must be implemented through future rulemaking, the ultimate impact of the Dodd-Frank Act, and any resulting regulation, is not yet certain. As a result, there can be no assurance that these measures will not have an adverse effect on the value or marketability of securities held by a Fund, including potentially limiting or completely restricting the ability of the Fund to use a particular investment instrument as part of its investment strategy, increasing the costs of using these instruments, or possibly making them less effective in general. Furthermore, no assurance can be made that the U.S. Government or any U.S. regulatory entity (or other authority or regulatory entity) will not continue to take further legislative or regulatory action in response to the economic crisis or otherwise, and the effect of such actions, if taken, cannot be known.
Bank Loans
The Fixed Income Funds may invest in bank loans, which include institutionally traded floating rate securities
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generally acquired as an assignment from another holder of, or participation interest in, loans originated by a bank or financial institution (the “Lender”) that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. When investing in a loan participation, a Fund has the right to receive payments of principal, interest and any fees to which it is entitled only from the Lender selling the loan agreement and only upon receipt by the Lender of payments from the borrower. The Fund generally has no right to enforce compliance with the terms of the loan agreement with the borrower. Assignments and participations involve credit, interest rate, and liquidity risk. Interest rates on floating rate securities adjust with general interest rate changes and/or issuer credit quality. The interest rates paid on a floating rate security in which the Fund invests generally are readjusted periodically to an increment over a designated benchmark rate, such as the one-month, three-month, six-month, or one-year London Interbank Offered Rate (“LIBOR”). LIBOR is a short-term interest rate that banks charge one another and is generally representative of the most competitive and current cash rates.
The Fixed Income Funds may have difficulty trading assignments and participations to third parties. There may be restrictions on transfer and only limited opportunities may exist to sell such securities in secondary markets. As a result, the Fixed Income Funds may be unable to sell assignments or participations at the desired time or may be able to sell only at a price less than fair market value. The Fixed Income Funds utilize an independent third party to value individual bank loans on a daily basis.
The average monthly value of borrowings outstanding under bank loan arrangements and the related rate range during the period ended December 31, 2010 is indicated in the table below:
Average Monthly | ||||||||
Fund | Value | Rates | ||||||
Fixed Income | ||||||||
Janus Flexible Bond Fund | $ | 27,468,925 | 0.0000% - 6.7500% | |||||
Janus High-Yield Fund | 52,594,937 | 2.0700% - 11.0000% | ||||||
Janus Short-Term Bond Fund | 66,705,650 | 0.1488% - 7.8512% | ||||||
Counterparties
Fund transactions involving a counterparty are subject to the risk that the counterparty or a third party will not fulfill its obligation to a Fund (“counterparty risk”). Counterparty risk may arise because of the counterparty’s financial condition (i.e., financial difficulties, bankruptcy, or insolvency), market activities and developments, or other reasons, whether foreseen or not. A counterparty’s inability to fulfill its obligation may result in significant financial loss to a Fund. A Fund may be unable to recover its investment from the counterparty or may obtain a limited recovery, and/or recovery may be delayed. The extent of a Fund’s exposure to counterparty risk in respect to financial assets approximates their carrying value as recorded on the Fund’s Statement of Assets and Liabilities.
A Fund may be exposed to counterparty risk through participation in various programs including, but not limited to, lending its securities to third parties, cash sweep arrangements whereby a Fund’s cash balance is invested in one or more types of cash management vehicles, as well as investments in, but not limited to, repurchase agreements, debt securities, and derivatives, including various types of swaps, futures and options. A Fund intends to enter into financial transactions with counterparties that Janus Capital believes to be creditworthy at the time of the transaction. There is always the risk that Janus Capital’s analysis of a counterparty’s creditworthiness is incorrect or may change due to market conditions. To the extent that a Fund focuses its transactions with a limited number of counterparties, it will have greater exposure to the risks associated with one or more counterparties.
Exchange-Traded Funds
The Fixed Income Funds may invest in exchange-traded funds, which generally are index-based investment companies that hold substantially all of their assets in securities representing their specific index. As a shareholder of another investment company, a Fund would bear its pro rata portion of the other investment company’s expenses, including advisory fees, in addition to the expenses the Fund bears directly in connection with its own operations.
Exchange-Traded Notes
The Fixed Income Funds may invest directly in exchange-traded notes (“ETNs”), which are senior, unsecured, unsubordinated debt securities whose returns are linked to a particular index and provide exposure to the total returns of various market indices, including indices linked to stocks, bonds, commodities and currencies. This type of debt security differs from other types of bonds and notes. ETN returns are based upon the performance of a market index minus applicable fees; no periodic coupon payments are distributed and no principal protections exist. ETNs do not pay cash distributions. Instead, the value of dividends, interest, and investment gains are captured in a Fund’s total return. The Funds will invest in these securities when desiring exposure to debt securities or commodities. When evaluating ETNs for investment, Janus Capital will consider the potential risks involved, expected tax efficiency, rate of return, and credit risk. When the Funds invest in ETNs, they will bear their proportionate share of any fees and expenses borne by the ETN. There may be
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restrictions on the Funds’ right to redeem their investment in an ETN, which is meant to be held until maturity. The Funds’ decision to sell their ETN holdings may be limited by the availability of a secondary market.
Floating Rate Loans
The Fixed Income Funds may invest in floating rate loans. Floating rate loans are debt securities that have floating interest rates, which adjust periodically, and are tied to a benchmark lending rate, such as LIBOR. In other cases, the lending rate could be tied to the prime rate offered by one or more major U.S. banks or the rate paid on large certificates of deposit traded in the secondary markets. If the benchmark lending rate changes, the rate payable to lenders under the loan will change at the next scheduled adjustment date specified in the loan agreement. Floating rate loans are typically issued to companies (“borrowers”) in connection with recapitalizations, acquisitions, and refinancings. Floating rate loan investments are generally below investment grade. Senior floating rate loans are secured by specific collateral of a borrower and are senior in the borrower’s capital structure. The senior position in the borrower’s capital structure generally gives holders of senior loans a claim on certain of the borrower’s assets that is senior to subordinated debt and preferred and common stock in the case of a borrower’s default. Floating rate loan investments may involve foreign borrowers, and investments may be denominated in foreign currencies. Floating rate loans often involve borrowers whose financial condition is troubled or uncertain and companies that are highly leveraged. The Funds may invest in obligations of borrowers who are in bankruptcy proceedings. Floating rate loans may include fully funded term loans or revolving lines of credit.
Initial Public Offerings
The Fixed Income Funds may invest in initial public offerings (“IPOs”). IPOs and other investment techniques may have a magnified performance impact on a Fund with a small asset base. The Funds may not experience similar performance as their assets grow.
Interfund Lending
As permitted by the Securities and Exchange Commission (“SEC”), or the 1940 Act and rules promulgated thereunder, the Funds may be party to interfund lending agreements between the Funds and other Janus Capital sponsored mutual funds and certain pooled investment vehicles, which permit them to borrow or lend cash at a rate beneficial to both the borrowing and lending funds. Outstanding borrowings from all sources totaling 10% or more of the borrowing Fund’s total assets must be collateralized at 102% of the outstanding principal value of the loan; loans of less than 10% may be unsecured.
Mortgage- and Asset-Backed Securities
The Funds may purchase fixed or variable rate mortgage-backed securities issued by the Government National Mortgage Association (“Ginnie Mae”), the Federal National Mortgage Association (“Fannie Mae”), the Federal Home Loan Mortgage Corporation (“Freddie Mac”), or other governmental or government-related entities. Historically, Fannie Mae and Freddie Mac securities were not backed by the full faith and credit of the U.S. Government, and may not be in the future. In September 2008, the Federal Housing Finance Agency (“FHFA”), an agency of the U.S. Government, placed Fannie Mae and Freddie Mac under conservatorship to provide stability in the financial markets, mortgage availability and taxpayer protection by preserving Fannie Mae’s and Freddie Mac’s assets, and placing them in a sound and solvent condition. Under the conservatorship, the management of Fannie Mae and Freddie Mac was replaced. The effect that the FHFA’s conservatorship will have on Fannie Mae’s and Freddie Mac’s debt and equities is unclear. The Funds may purchase other mortgage- and asset-backed securities through single- and multi-seller conduits, collateralized debt obligations, structured investment vehicles, and other similar securities. Asset-backed securities may be backed by automobile loans, equipment leases, credit card receivables, or other collateral. In the event the underlying securities fail to perform, these investment vehicles could be forced to sell the assets and recognize losses on such assets, which could impact the Funds’ yield and the Funds’ return. In addition, mortgage-backed securities may be supported by some form of government or private guarantee and/or insurance. However, there is no assurance that the guarantors or insurers will meet their obligations.
Unlike traditional debt instruments, payments on these securities include both interest and a partial payment of principal. Prepayment risk, which results from prepayments of the principal of underlying loans, may shorten the effective maturities of these securities and may result in a Fund having to reinvest proceeds at a lower interest rate.
In addition to prepayment risk, investments in mortgage-backed securities, including those comprised of subprime mortgages, and investments in other asset-backed securities comprised of under-performing assets may be subject to a higher degree of credit risk, valuation risk, and liquidity risk. Additionally, although mortgages and mortgage-related securities are generally supported by some form of government or private guarantee and/or insurance, there is no assurance that private guarantors or insurers will meet their obligations.
Mortgage- and asset-backed securities are also subject to extension risk, which is the risk that rising interest rates could cause mortgages or other obligations underlying
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these securities to be paid more slowly than expected, increasing the Funds’ sensitivity to interest changes and causing its price to decline.
Mortgage Dollar Rolls
The Fixed Income Funds may enter into “mortgage dollar rolls.” In a “mortgage dollar roll” transaction, the Funds sell a mortgage-related security (such as a Ginnie Mae security) to a dealer and simultaneously agree to repurchase a similar security (but not the same security) in the future at a predetermined price. The Funds will not be entitled to receive interest and principal payments while the dealer holds the security. The difference between the sale price and the future purchase price is recorded as an adjustment to investment income.
The Funds’ obligations under a dollar roll agreement must be covered by cash, U.S. Government securities or other liquid high-grade debt obligations equal in value to the securities subject to repurchase by the Funds, maintained in a segregated account. To the extent that the Funds collateralize their obligations under a dollar roll agreement, the asset coverage requirements of the 1940 Act will not apply to such transactions. Furthermore, under certain circumstances, an underlying mortgage-backed security that is part of a dollar roll transaction may be considered illiquid.
Successful use of mortgage dollar rolls depends on the portfolio managers’ ability to predict interest rates and mortgage payments. Dollar roll transactions involve the risk that the market value of the securities the Funds are required to purchase may decline below the agreed upon repurchase price.
Restricted Security Transactions
Restricted securities held by the Funds may not be sold except in exempt transactions or in a public offering registered under the Securities Act of 1933, as amended. The risk of investing in such securities is generally greater than the risk of investing in the securities of widely held, publicly traded companies. Lack of a secondary market and resale restrictions may result in the inability of the Funds to sell a security at a fair price and may substantially delay the sale of the security. In addition, these securities may exhibit greater price volatility than securities for which secondary markets exist.
Securities Lending
Under procedures adopted by the Trustees, the Funds may seek to earn additional income through lending their securities to certain qualified broker-dealers and institutions on a short-term or long-term basis. The Funds may lend portfolio securities on a short-term or long-term basis, in an amount equal to up to 1/3 of their total assets as determined at the time of the loan origination. When the Funds lend their securities, they receive collateral (including cash collateral), at least equal to the value of securities loaned. The Funds may earn income by investing this collateral in one or more affiliated or non-affiliated cash management vehicles. It is also possible that, due to a decline in the value of a cash management vehicle, the Funds may lose money. There is also the risk that when portfolio securities are lent, the securities may not be returned on a timely basis, and the Funds may experience delays and costs in recovering the security or gaining access to the collateral provided to the Funds to collateralize the loan. If the Funds are unable to recover a security on loan, the Funds may use the collateral to purchase replacement securities in the market. There is a risk that the value of the collateral could decrease below the cost of the replacement security by the time the replacement investment is made, resulting in a loss to the Funds. Janus Capital intends to manage the cash collateral in an affiliated cash management vehicle and will receive an investment advisory fee for managing such assets.
The borrower pays fees at the Funds’ direction to Deutsche Bank AG (the “Lending Agent”). The Lending Agent may retain a portion of the interest earned on the cash collateral invested. The cash collateral invested by the Lending Agent is disclosed on the Schedules of Investments (if applicable). The lending fees and the Funds’ portion of the interest income earned on cash collateral are included on the Statements of Operations (if applicable).
The Funds did not have any securities on loan during the period.
Securities Traded on a To-Be-Announced Basis
The Fixed Income Funds may trade securities on a to-be-announced (“TBA”) basis. In a TBA transaction, the Funds commit to purchasing or selling securities for which specific information is not yet known at the time of the trade, particularly the face amount and maturity date in Ginnie Mae, Fannie Mae and/or Freddie Mac transactions.
Securities purchased on a TBA basis are not settled until they are delivered to the Funds, normally 15 to 45 days later. Beginning on the date the Funds enter into a TBA transaction, cash, U.S. Government securities or other liquid high-grade debt obligations are segregated in an amount equal in value to the purchase price of the TBA security. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.
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Notes to Financial Statements (unaudited) (continued)
Short Sales
The Fixed Income Funds may engage in “short sales against the box.” Short sales against the box involve either selling short a security that the Funds own or selling short a security that the Funds have the right to obtain, for delivery at a specified date in the future. The Funds may enter into short sales against the box to hedge against anticipated declines in the market price of portfolio securities. The Funds do not deliver from their portfolios the securities sold short and do not immediately receive the proceeds of the short sale. The Funds borrow the securities sold short and receive proceeds from the short sale only when they deliver the securities to the lender. If the value of the securities sold short increases prior to the scheduled delivery date, the Funds lose the opportunity to participate in the gain.
The Fixed Income Funds may also engage in other short sales. The Funds may engage in short sales when the portfolio managers anticipate that a security’s market purchase price will be less than its borrowing price. To complete the transaction, the Funds must borrow the security to deliver it to the purchaser and buy that same security in the market to return it to the lender. No more than 10% of a Fund’s net assets may be invested in short positions (through short sales of stocks, structured products, futures, swaps, and uncovered written calls). The Funds may engage in short sales “against the box” and options for hedging purposes that are not subject to this 10% limit. Although the potential for gain as a result of a short sale is limited to the price at which the Fund sold the security short less the cost of borrowing the security, the potential for loss is theoretically unlimited because there is no limit to the cost of replacing the borrowed security. There is no assurance the Funds will be able to close out a short position at a particular time or at an acceptable price. A gain or a loss will be recognized upon termination of a short sale. Short sales held by the Funds are fully collateralized by restricted cash or other securities, which are denoted on the accompanying Schedules of Investments (if applicable). The Funds are also required to pay the lender of the security any dividends or interest that accrues on a borrowed security during the period of the loan. Depending on the arrangements made with the broker or custodian, a Fund may or may not receive any payments (including interest) on collateral it has deposited with the broker. The Funds pay stock loan fees on assets borrowed from the security broker.
The Fixed Income Funds may also enter into short positions through derivative instruments, such as options contracts, futures contracts, and swap agreements, which may expose the Funds to similar risks. To the extent that the Funds enter into short derivative positions, the Funds may be exposed to risks similar to those associated with short sales, including the risk that the Funds’ losses are theoretically unlimited.
When-Issued Securities
The Funds may purchase or sell securities on a when-issued or forward commitment basis. The price of the underlying securities and date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. Losses may arise due to changes in the market value of the securities or from the inability of counterparties to meet the terms of the contract. In connection with such purchases, the Funds may hold liquid assets as collateral with the Funds’ custodian sufficient to cover the purchase price.
4. | Investment Advisory Agreements and Other Transactions with Affiliates |
Each Fund pays Janus Capital an investment advisory fee which is calculated daily and paid monthly. The following table reflects each Fund’s contractual investment advisory fee rate (expressed as an annual rate).
Contractual | |||||||
Investment | |||||||
Average | Advisory | ||||||
Daily Net Assets | Fee (%) | ||||||
Fund | of the Fund | (annual rate) | |||||
Fixed Income | |||||||
Janus Flexible Bond Fund | First $300 Million | 0.50 | |||||
Over $300 Million | 0.40 | ||||||
Janus Global Bond Fund | First $1 Billion | 0.60 | |||||
Next $1 Billion | 0.55 | ||||||
Over $2 Billion | 0.50 | ||||||
Janus High-Yield Fund | First $300 Million | 0.65 | |||||
Over $300 Million | 0.55 | ||||||
Janus Short-Term Bond Fund | First $300 Million | 0.64 | |||||
Over $300 Million | 0.54 | ||||||
Money Market | |||||||
Janus Government Money Market Fund | All Asset Levels | 0.20 | |||||
Janus Money Market Fund | All Asset Levels | 0.20 | |||||
Janus Capital has agreed to waive one-half of each Money Market Fund’s advisory fees. Such waiver is voluntary and could change or be terminated at any time at the discretion of Janus Capital. Janus Capital may also voluntarily waive additional fees to the extent necessary to assist the Money Market Funds in attempting to maintain a yield of at least 0.00%. These reimbursements are voluntary and could change or be terminated at any time at the discretion of Janus Capital. In addition, the Money Market Funds pay Janus Capital an administration fee. Prior to February 16, 2010, this fee was 0.50% of average daily net assets. Effective February 16, 2010, Class D Shares of each Fund will compensate Janus Capital at an annual rate of 0.46% and Class T Shares of each Fund will compensate Janus Capital at an annual
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rate of 0.48%. The Money Market Funds pay those expenses not assumed by Janus Capital. The expenses not assumed by Janus Capital include interest and taxes, fees and expenses of Trustees who are not interested persons of Janus Capital, audit fees and expenses, and extraordinary expenses.
Janus Services LLC (“Janus Services”), a wholly-owned subsidiary of Janus Capital, is the Funds’ transfer agent. In addition, Janus Services provides or arranges for the provision of certain other administrative services including, but not limited to, recordkeeping, accounting, order processing, and other shareholder services for the Funds.
Class D Shares of the Fixed Income Funds pay an annual administrative services fee of 0.12% of net assets. These administrative services fees are paid by the Shares of each Fund for shareholder services provided by Janus Services.
Janus Services receives an administrative services fee at an annual rate of 0.25% of the average daily net assets of Class R Shares, Class S Shares and Class T Shares of the Fixed Income Funds for providing or procuring administrative services to investors in Class R Shares, Class S Shares and Class T Shares of the Funds. Janus Services expects to use all or a significant portion of this fee to compensate retirement plan service providers, broker-dealers, bank trust departments, financial advisors, and other financial intermediaries for providing these services. Services provided by these financial intermediaries may include, but are not limited to, recordkeeping, subaccounting, order processing, providing periodic statements, forwarding prospectuses, shareholder reports, and other materials to existing customers and other administrative services. Order processing includes the submission of transactions through the National Securities Clearing Corporation (“NSCC”) or similar systems, or those processed on a manual basis with Janus. Janus Services or its affiliates may also pay fees for services provided by intermediaries to the extent the fees charged by intermediaries exceed the 0.25% of net assets charged to Class R Shares, Class S Shares, and Class T Shares of each Fund.
Certain, but not all, intermediaries may charge administrative fees to investors in Class A, Class C, and Class I Shares for administrative services provided on behalf of such investors. These administrative fees are paid by the Class A Shares, Class C Shares, and Class I Shares of the Funds to Janus Services, which uses such fees to reimburse intermediaries. Janus Services may negotiate the level, structure, and/or terms of the administrative fees with intermediaries requiring such fees on behalf of the Funds. Janus Capital and its affiliates benefit from an increase in assets that may result from such relationships.
Janus Distributors LLC (“Janus Distributors”), a wholly-owned subsidiary of Janus Capital, is the distributor of the Funds. The Funds have adopted a Distribution and Shareholder Servicing Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Fixed Income Funds at an annual rate, as determined from time to time by the Board of Trustees, of up to 0.25% of the Class A Shares average daily net assets, of up to 1.00% of the Class C Shares average daily net assets, of up to 0.50% of the Class R Shares average daily net assets, and of up to 0.25% of the Class S Shares average daily net assets. Payments under the Plan are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder service expenses actually incurred by the Funds. If any of a Fund’s actual distribution and shareholder service expenses incurred during a calendar year are less than the payments made during a calendar year, the Fund will be refunded for the difference. Refunds, if any, are included in the “Distribution fees and shareholder servicing fees” in the Statements of Operations.
Janus Capital has agreed to reimburse the Fixed Income Funds until at least November 1, 2011 by the amount, if any, that such Fund’s normal operating expenses in any fiscal year, including the investment advisory fee, but excluding any class-specific distribution and shareholder servicing fees applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares, the administrative services fees payable pursuant to the Transfer Agency Agreement applicable to Class D Shares, Class R Shares, Class S Shares, and Class T Shares, brokerage commissions, interest, dividends, taxes and extraordinary expenses (including, but not limited to, acquired fund fees and expenses), exceed the annual rates noted below. If applicable, amounts reimbursed to the Funds by Janus Capital are disclosed as “Excess Expense Reimbursement” on the Statements of Operations.
Expense | |||||
Fund | Limit (%) | ||||
Fixed Income | |||||
Janus Flexible Bond Fund | 0.55 | ||||
Janus Global Bond Fund | 0.75 | ||||
Janus High-Yield Fund | 0.78 | ||||
Janus Short-Term Bond Fund | 0.55 | ||||
The Board of Trustees has adopted a deferred compensation plan (the “Deferred Plan”) for independent Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Funds. All deferred fees are credited to an account
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Notes to Financial Statements (unaudited) (continued)
established in the name of the Trustees. The amounts credited to the account then increase or decrease, as the case may be, in accordance with the performance of one or more of the Janus funds that are selected by the Trustees. The account balance continues to fluctuate in accordance with the performance of the selected fund or funds until final payment of all amounts are credited to the account. The fluctuation of the account balance is recorded by the Funds as unrealized appreciation/(depreciation) and is shown as of December 31, 2010 on the Statements of Assets and Liabilities as an asset, “Non-interested Trustees’ deferred compensation,” and a liability, “Non-interested Trustees’ deferred compensation fees.” Additionally, the recorded unrealized appreciation/(depreciation) is included in “Unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” for the Fixed Income Funds, and “Unrealized net appreciation/(depreciation) of investments for non-interested Trustees’ deferred compensation” for the Money Market Funds on the Statements of Assets and Liabilities. Deferred compensation expenses for the period ended December 31, 2010 are included in “Non-interested Trustees’ fees and expenses” on the Statements of Operations. Trustees are allowed to change their designation of mutual funds from time to time. Amounts will be deferred until distributed in accordance with the Deferred Plan. No deferred fees were distributed to any Trustee under the Deferred Plan during the period ended December 31, 2010.
For the period ended December 31, 2010, Janus Capital assumed $28,267 of legal, consulting and Trustee costs and fees incurred by the funds in the Trust and Janus Aspen Series together with the Trust (the “Portfolios”), in connection with the regulatory and civil litigation matters discussed in Note 11. These non-recurring costs were allocated to all Portfolios based on the Portfolios’ respective net assets as of July 31, 2004. Unless noted otherwise in the financial highlights, the effect of these non-recurring costs assumed by Janus Capital are included in the ratio of gross expenses to average net assets and were less than 0.01%. No fees were allocated to the Portfolios that commenced operations after July 31, 2004. Additionally, all future non-recurring costs will be allocated to the Portfolios based on the Portfolios’ respective net assets on July 31, 2004. These “Non-recurring costs” and “Costs assumed by Janus Capital” are shown on the Statements of Operations.
Certain officers of the Funds may also be officers and/or directors of Janus Capital. Such officers receive no compensation from the Funds, except for the Funds’ Chief Compliance Officer. The Funds reimburse Janus Capital for a portion of the compensation paid to the Chief Compliance Officer and certain compliance staff of the Trust. Total compensation of $266,383 was paid by the Trust during the period ended December 31, 2010. Each Fund’s portion is reported as part of “Other Expenses” on the Statements of Operations.
Class A Shares of Janus Flexible Bond Fund, Janus Global Bond Fund and Janus High-Yield Fund include a 4.75% upfront sales charge of the offering price. Class A Shares of Janus Short-Term Bond Fund include a 2.50% upfront sales charge of the offering price. The sales charge is allocated between Janus Distributors and financial intermediaries. During the period ended December 31, 2010, Janus Distributors retained the following upfront sales charges:
Upfront | |||||
Fund (Class A Shares) | Sales Charge | ||||
Fixed Income | |||||
Janus Flexible Bond Fund | $ | 66,123 | |||
Janus High-Yield Fund | 13,088 | ||||
Janus Short-Term Bond Fund | 11,665 | ||||
A contingent deferred sales charge of 1.00% will be deducted with respect to Class A Shares purchased without a sales load and redeemed within 12 months of purchase, unless waived, as discussed in the Prospectus. Any applicable CDSC will be 1.00% of the lesser of the original purchase price or the value of the redemption of the Class A Shares redeemed. During the period ended December 31, 2010, redeeming shareholders of Class A Shares paid the following contingent deferred sales charges:
Contingent Deferred | |||||
Fund (Class A Shares) | Sales Charge | ||||
Fixed Income | |||||
Janus Short-Term Bond Fund | $ | 10,870 | |||
Class C Shares include a 1.00% contingent deferred sales charge paid by redeeming shareholders to Janus Distributors. The contingent deferred sales charge applies to shares redeemed within 12 months of purchase. The redemption price may differ from the net asset value per share. During the period ended December 31, 2010, redeeming shareholders of Class C Shares paid the following contingent deferred sales charges:
Contingent Deferred | |||||
Fund (Class C Shares) | Sales Charge | ||||
Fixed Income | |||||
Janus Flexible Bond Fund | $ | 24,366 | |||
Janus High-Yield Fund | 2,013 | ||||
Janus Short-Term Bond Fund | 4,326 | ||||
A 2.00% redemption fee may be imposed on Class D Shares, Class I Shares, Class R Shares, Class S Shares, and Class T Shares of Janus High-Yield Fund held for 90 days or less. This fee is paid to the Fund rather than Janus Capital, and is designed to deter excessive short-
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term trading and to offset the brokerage commissions, market impact, and other costs associated with changes in the Fund’s asset levels and cash flow due to short-term money movements in and out of the Fund. The redemption fee is accounted for as an addition to Paid-in Capital.
Total redemption fees received by the Fund for the period ended December 31, 2010 are indicated in the table below:
Fund | Redemption Fee | ||||
Fixed-Income | |||||
Janus High-Yield Fund | $ | 68,198 | |||
The Fixed Income Funds’ expenses may be reduced by expense offsets from an unaffiliated custodian and/or transfer agent. Such credits or offsets are included in “Expense and Fee Offset” on the Statements of Operations (if applicable). The transfer agent fee offsets received during the period reduce “Transfer agent fees and expenses” on the Statements of Operations (if applicable). Custodian offsets received reduce “Custodian fees” on the Statements of Operations (if applicable). The Funds could have employed the assets used by the custodian and/or transfer agent to produce income if they had not entered into an expense offset arrangement.
Pursuant to the terms and conditions of an SEC exemptive order and the provisions of the 1940 Act, the Fixed Income Funds may participate in an affiliated or non-affiliated cash sweep program. In the cash sweep program, uninvested cash balances of the Funds may be used to purchase shares of affiliated or non-affiliated money market funds or cash management pooled investment vehicles. The Funds are eligible to participate in the cash sweep program (the “Investing Funds”). Janus Cash Liquidity Fund LLC is an affiliated unregistered cash management pooled investment vehicle that invests primarily in highly-rated short-term fixed-income securities. Janus Cash Liquidity Fund LLC currently maintains a NAV of $1.00 per share and distributes income daily in a manner consistent with a registered 2a-7 product. There are no restrictions on the Funds’ ability to withdraw investments from Janus Cash Liquidity Fund LLC at will, and there are no unfunded capital commitments due from the Funds to Janus Cash Liquidity Fund LLC. As adviser, Janus Capital has an inherent conflict of interest because of its fiduciary duties to the affiliated cash management pooled investment vehicles and the Investing Funds.
During the six months ended December 31, 2010, Janus Capital reimbursed Janus High-Yield Fund $6,594,658 as a result of an administrative error.
During the period ended December 31, 2010, the following Funds recorded distributions from affiliated investment companies as affiliated dividend income, and had the following affiliated purchases and sales:
Purchases | Sales | Dividend | Value | |||||||||||
Shares/Cost | Shares/Cost | Income | at 12/31/10 | |||||||||||
Janus Cash Liquidity Fund LLC | ||||||||||||||
Fixed Income | ||||||||||||||
Janus Flexible Bond Fund | $ | 1,172,382,729 | $ | (1,268,700,000) | $ | 152,497 | $ | 23,932,620 | ||||||
Janus Global Bond Fund | 10,015,000 | (6,000) | 135 | 10,009,000 | ||||||||||
Janus High-Yield Fund | 531,945,137 | (511,694,000) | 77,722 | 76,903,466 | ||||||||||
Janus Short-Term Bond Fund | 1,007,762,140 | (1,061,688,673) | 61,552 | 3,507,278 | ||||||||||
$ | 2,722,105,006 | $ | (2,842,088,673) | $ | 291,906 | $ | 114,352,364 | |||||||
Janus Capital or an affiliate invested and/or redeemed initial seed capital during the period ended December 31, 2010, as indicated in the following table.
Seed | Seed | |||||||||||||||||||
Capital at | Date of | Date of | Capital at | |||||||||||||||||
Fund | 6/30/10 | Purchases | Purchases | Redemptions | Redemption | 12/31/10 | ||||||||||||||
Fixed Income | ||||||||||||||||||||
Janus Global Bond Fund - Class A Shares | $ | – | 833,333 | 12/27/10 | $ | – | – | $ | 833,333 | |||||||||||
Janus Global Bond Fund - Class C Shares | – | 833,334 | 12/27/10 | – | – | 833,334 | ||||||||||||||
Janus Global Bond Fund - Class D Shares | – | 833,333 | 12/27/10 | – | – | 833,333 | ||||||||||||||
Janus Global Bond Fund - Class I Shares | – | 833,333 | 12/27/10 | – | – | 833,333 | ||||||||||||||
Janus Global Bond Fund - Class S Shares | – | 833,334 | 12/27/10 | – | – | 833,334 | ||||||||||||||
Janus Global Bond Fund - Class T Shares | – | 833,333 | 12/27/10 | – | – | 833,333 | ||||||||||||||
Janus Short-Term Bond Fund - Class A Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Short-Term Bond Fund - Class C Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Short-Term Bond Fund - Class I Shares | 1,000 | – | – | – | – | 1,000 | ||||||||||||||
Janus Short-Term Bond Fund - Class S Shares | 1,000 | – | – | – | 1,000 | |||||||||||||||
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Notes to Financial Statements (unaudited) (continued)
5. | Federal Income Tax |
Income and capital gains distributions are determined in accordance with income tax regulations that may differ from accounting principles generally accepted in the United States of America. These differences are due to differing treatments for items such as net short-term gains, deferral of wash sale losses, foreign currency transactions, net investment losses and capital loss carryovers.
The Funds have elected to treat gains and losses on forward foreign currency contracts as capital gains and losses, if applicable. Other foreign currency gains and losses on debt instruments are treated as ordinary income for federal income tax purposes pursuant to Section 988 of the Internal Revenue Code.
The aggregate cost of investments and the composition of unrealized appreciation and depreciation of investment securities for federal income tax purposes as of December 31, 2010 are noted below.
Unrealized appreciation and unrealized depreciation in the table below exclude appreciation/(depreciation) on foreign currency translations. The primary difference between book and tax appreciation or depreciation of investments is wash sale loss deferrals.
Federal Tax | Unrealized | Unrealized | Net Tax | |||||||||||
Fund | Cost | Appreciation | (Depreciation) | Appreciation | ||||||||||
Fixed Income | ||||||||||||||
Janus Flexible Bond Fund | $ | 3,112,643,598 | $ | 87,846,389 | $ | (23,494,445) | $ | 64,351,944 | ||||||
Janus Global Bond Fund | 10,009,000 | – | – | – | ||||||||||
Janus High-Yield Fund | 1,445,137,620 | 113,119,121 | (3,000,673) | 110,118,448 | ||||||||||
Janus Short-Term Bond Fund | 2,615,223,647 | 40,888,184 | (3,639,466) | 37,248,718 | ||||||||||
Money Market | ||||||||||||||
Janus Government Money Market Fund | 202,537,840 | – | – | – | ||||||||||
Janus Money Market Fund | 1,309,559,665 | – | – | – | ||||||||||
Net capital loss carryovers as of June 30, 2010 are indicated in the table below. These losses may be available to offset future realized capital gains and thereby reduce future taxable gains distributions. The following table shows the expiration dates of the carryovers.
Capital Loss Carryover Expiration Schedule
For the eight-month fiscal period ended June 30, 2010
Accumulated | |||||||||||
Fund | June 30, 2016 | June 30, 2017 | Capital Losses | ||||||||
Fixed Income | |||||||||||
Janus High-Yield Fund | $ | (43,674,603) | $ | (43,984,661) | $ | (87,659,264) | |||||
108 | DECEMBER 31, 2010
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6. | Expense Ratios |
The expense ratios listed in the Financial Highlights reflect expenses prior to any expense offsets (gross expense ratio) and after expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursement). Listed below are the gross expense ratios for the Fixed Income Funds that would have been in effect, absent the waiver of certain fees and offsets.
For the six-month period ended December 31, 2010
(unaudited), the eight-month fiscal period ended
June 30, 2010 and each fiscal year or period ended
October 31
(unaudited), the eight-month fiscal period ended
June 30, 2010 and each fiscal year or period ended
October 31
Janus Flexible | Janus Global | Janus High-Yield | Janus Short-Term | |||||||||||||
Bond Fund | Bond Fund | Fund | Bond Fund | |||||||||||||
Class A Shares | ||||||||||||||||
2010 | 0.76% | 3.51%(1) | 0.94% | 0.89% | ||||||||||||
2010(2) | 0.76% | N/A | 0.92% | 0.84% | ||||||||||||
2009(2) | 0.80% | N/A | 0.96% | 0.88% | ||||||||||||
Class C Shares | ||||||||||||||||
2010 | 1.52% | 4.07%(1) | 1.70% | 1.66% | ||||||||||||
2010(2) | 1.51% | N/A | 1.65% | 1.59% | ||||||||||||
2009(3) | 1.58% | N/A | 1.71% | 1.63% | ||||||||||||
Class D Shares | ||||||||||||||||
2010 | 0.59% | 3.42%(1) | 0.79% | 0.73% | ||||||||||||
2010(4) | 0.60% | N/A | 0.77% | 0.74% | ||||||||||||
Class I Shares | ||||||||||||||||
2010 | 0.55% | 3.32%(1) | 0.68% | 0.65% | ||||||||||||
2010(2) | 0.59% | N/A | 0.64% | 0.59% | ||||||||||||
2009(3) | 0.48% | N/A | 0.66% | 0.79% | ||||||||||||
Class R Shares | ||||||||||||||||
2010 | 1.21% | N/A | 1.40% | N/A | ||||||||||||
2010(2) | 1.20% | N/A | 1.37% | N/A | ||||||||||||
2009(3) | 1.25% | N/A | 1.41% | N/A | ||||||||||||
Class S Shares | ||||||||||||||||
2010 | 0.95% | 3.70%(1) | 1.15% | 1.09% | ||||||||||||
2010(2) | 0.95% | N/A | 1.12% | 1.09% | ||||||||||||
2009(3) | 0.99% | N/A | 1.18% | 1.13% | ||||||||||||
Class T Shares | ||||||||||||||||
2010 | 0.71% | 3.51%(1) | 0.90% | 0.84% | ||||||||||||
2010(2) | 0.66% | N/A | 0.86% | 0.83% | ||||||||||||
2009 | 0.73% | N/A | 0.89% | 0.87% | ||||||||||||
2008 | 0.78% | N/A | 0.90% | 0.98% | ||||||||||||
2007 | 0.80% | N/A | 0.87% | 1.01% | ||||||||||||
2006 | 0.83% | N/A | 0.93% | 1.06% | ||||||||||||
2005 | 0.78% | N/A | 0.88% | 0.97% | ||||||||||||
(1) | Period from December 28, 2010 (inception date) through December 31, 2010. | |
(2) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(3) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(4) | Period from February 16, 2010 (inception date) through June 30, 2010. |
Janus Fixed Income & Money Market Funds | 109
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Notes to Financial Statements (unaudited) (continued)
7. | Capital Share Transactions |
For the six-month period ended | ||||||||||||||||||||||||||||||||||||||||||
December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||||||||||||||
the eight-month fiscal period ended | ||||||||||||||||||||||||||||||||||||||||||
June 30, 2010 | ||||||||||||||||||||||||||||||||||||||||||
and the fiscal year ended | Janus | Janus | ||||||||||||||||||||||||||||||||||||||||
October 31, 2009 | Janus Flexible | Janus Global | High-Yield | Short-Term | ||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | Bond Fund | Bond Fund | Fund | Bond Fund | ||||||||||||||||||||||||||||||||||||||
Fixed Income | 2010 | 2010(1) | 2009(2) | 2010(3) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(1) | 2009(2) | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class A Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 12,353 | 13,716 | 9,736 | 83 | 4,628 | 5,513 | 4,029 | 18,719 | 32,888 | 14,712 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | 18,622 | N/A | N/A | N/A | 7,575 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 1,557 | 693 | 213 | – | 459 | 531 | 249 | 675 | 327 | 25 | ||||||||||||||||||||||||||||||||
Shares repurchased | (8,485) | (6,318) | (6,380) | – | (2,341) | (3,386) | (1,599) | (15,283) | (8,224) | (489) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 5,425 | 8,091 | 22,191 | 83 | 2,746 | 2,658 | 10,254 | 4,111 | 24,991 | 14,248 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 30,282 | 22,191 | – | – | 12,912 | 10,254 | – | 39,239 | 14,248 | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 35,707 | 30,282 | 22,191 | 83 | 15,658 | 12,912 | 10,254 | 43,350 | 39,239 | 14,248 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class C Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 6,632 | 9,785 | 5,693 | 83 | 1,232 | 2,131 | 2,957 | 5,911 | 14,371 | 7,829 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | 11,050 | N/A | N/A | N/A | 4,978 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 683 | 276 | 80 | – | 212 | 303 | 138 | 236 | 104 | 14 | ||||||||||||||||||||||||||||||||
Shares repurchased | (3,506) | (3,412) | (1,343) | – | (1,075) | (1,781) | (623) | (3,391) | (1,751) | (134) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 3,809 | 6,649 | 15,480 | 83 | 369 | 653 | 7,450 | 2,756 | 12,724 | 7,709 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 22,129 | 15,480 | – | – | 8,103 | 7,450 | – | 20,433 | 7,709 | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 25,938 | 22,129 | 15,480 | 83 | 8,472 | 8,103 | 7,450 | 23,189 | 20,433 | 7,709 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class D Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 9,192 | 6,826(4) | N/A | 84 | 4,588 | 2,273(4) | N/A | 9,209 | 10,119(4) | N/A | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 9) | N/A | 5,8707(4) | N/A | N/A | N/A | 30,451(4) | N/A | N/A | 75,849(4) | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 3,082 | 925(4) | N/A | – | 978 | 815(4) | N/A | 1,362 | 695(4) | N/A | ||||||||||||||||||||||||||||||||
Shares repurchased | (8,464) | (4,254)(4) | N/A | – | (2,520) | (4,187)(4) | N/A | (12,032) | (13,193)(4) | N/A | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 3,810 | 62,204(4) | N/A | 84 | 3,046 | 29,352(4) | N/A | (1,461) | 73,470(4) | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 62,204 | – | N/A | – | 29,352 | – | N/A | 73,470 | – | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 66,014 | 62,204 | N/A | 84 | 32,398 | 29,352 | N/A | 72,009 | 73,470 | N/A | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class I Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 40,781 | 38,926 | 29,763 | 585 | 14,949 | 7,474 | 1,894 | 70,661 | 48,512 | 23,311 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | 14,545 | N/A | N/A | N/A | 1,551 | N/A | N/A | N/A |
110 | DECEMBER 31, 2010
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For the six-month period ended | ||||||||||||||||||||||||||||||||||||||||||
December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||||||||||||||
the eight-month fiscal period ended | ||||||||||||||||||||||||||||||||||||||||||
June 30, 2010 | ||||||||||||||||||||||||||||||||||||||||||
and the fiscal year ended | Janus | Janus | ||||||||||||||||||||||||||||||||||||||||
October 31, 2009 | Janus Flexible | Janus Global | High-Yield | Short-Term | ||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | Bond Fund | Bond Fund | Fund | Bond Fund | ||||||||||||||||||||||||||||||||||||||
Fixed Income | 2010 | 2010(1) | 2009(2) | 2010(3) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(1) | 2009(2) | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 4,238 | 1,606 | 275 | – | 581 | 215 | 55 | 1,025 | 165 | 5 | ||||||||||||||||||||||||||||||||
Shares repurchased | (13,344) | (12,291) | (1,083) | (1) | (2,476) | (1,709) | (838) | (23,235) | (16,030) | (503) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 31,675 | 28,241 | 43,500 | 584 | 13,054 | 5,980 | 2,662 | 48,451 | 32,647 | 22,813 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 71,741 | 43,500 | – | – | 8,642 | 2,662 | – | 55,460 | 22,813 | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 103,416 | 71,741 | 43,500 | 584 | 21,696 | 8,642 | 2,662 | 103,911 | 55,460 | 22,813 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class R Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 394 | 329 | 197 | N/A | 27 | 93 | 5 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | 136 | N/A | N/A | N/A | 107 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 32 | 10 | 3 | N/A | 3 | 6 | 4 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Shares repurchased | (195) | (117) | (36) | N/A | (36) | (111) | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 231 | 222 | 300 | N/A | (6) | (12) | 116 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 522 | 300 | – | N/A | 104 | 116 | – | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 753 | 522 | 300 | N/A | 98 | 104 | 116 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class S Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 881 | 2,932 | 2,340 | 83 | 201 | 387 | 364 | 654 | 1,571 | 2,246 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | 6,074 | N/A | N/A | N/A | 470 | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 272 | 198 | 83 | – | 27 | 36 | 14 | 26 | 15 | 3 | ||||||||||||||||||||||||||||||||
Shares repurchased | (1,376) | (4,152) | (1,726) | – | (146) | (376) | (144) | (607) | (1,406) | (760) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (223) | (1,022) | 6,771 | 83 | 82 | 47 | 704 | 73 | 180 | 1,489 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 5,749 | 6,771 | – | – | 751 | 704 | – | 1,669 | 1,489 | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 5,526 | 5,749 | 6,771 | 83 | 833 | 751 | 704 | 1,742 | 1,669 | 1,489 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 24,847 | 31,506 | 46,972 | 83 | 22,613 | 33,154 | 62,740 | 161,877 | 440,032 | 419,692 | ||||||||||||||||||||||||||||||||
Shares reorganized in connection with restructuring (Note 9) | N/A | (58,707) | N/A | N/A | N/A | (30,451) | N/A | N/A | (75,849) | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 3,351 | 2,609 | 3,739 | – | 3,233 | 5,044 | 8,890 | 11,711 | 8,520 | 6,288 | ||||||||||||||||||||||||||||||||
Shares repurchased | (18,709) | (19,759) | (27,903) | – | (14,578) | (30,478) | (20,129) | (196,949) | (135,349) | (111,230) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 9,489 | (44,351) | 22,808 | 83 | 11,268 | (22,731) | 51,501 | (23,361) | 237,354 | 314,750 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 59,968 | 104,319 | 81,511 | – | 83,692 | 106,423 | 54,922 | 632,980 | 395,626 | 80,876 | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 69,457 | 59,968 | 104,319 | 83 | 94,960 | 83,692 | 106,423 | 609,619 | 632,980 | 395,626 |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009 for Class A Shares, Class C Shares, Class I Shares, Class R Shares and Class S Shares and November 1, 2008 through October 31, 2009 for Class T Shares. | |
(3) | Period from December 28, 2010 (inception date) through December 31, 2010 | |
(4) | Transactions in Fund Shares for Class D Shares are for the period from February 16, 2010 (inception date) to June 30, 2010. |
Janus Fixed Income & Money Market Funds | 111
Table of Contents
Notes to Financial Statements (unaudited) (continued)
For the six-month period ended | ||||||||||||||||||||||||||
December 31, 2010 (unaudited), | ||||||||||||||||||||||||||
the eight-month fiscal period | ||||||||||||||||||||||||||
ended June 30, 2010 | ||||||||||||||||||||||||||
and the fiscal year ended | ||||||||||||||||||||||||||
October 31, 2009 | ||||||||||||||||||||||||||
(all numbers in thousands) | Janus Government Money Market Fund | Janus Money Market Fund | ||||||||||||||||||||||||
Money Market | 2010 | 2010(1) | 2009 | 2010 | 2010(1) | 2009 | ||||||||||||||||||||
Transactions in Fund Shares – Class D Shares: | ||||||||||||||||||||||||||
Shares sold | 38,054 | 37,209(2) | N/A | 254,347 | 260,518(2) | N/A | ||||||||||||||||||||
Shares issued in connection with restructuring (Note 9) | – | 214,931(2) | N/A | – | 1,291,105(2) | N/A | ||||||||||||||||||||
Reinvested dividends and distributions | 5 | 29(2) | N/A | 32 | 20(2) | N/A | ||||||||||||||||||||
Shares repurchased | (51,552) | (40,409)(2) | N/A | (350,133) | (314,631)(2) | N/A | ||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (13,493) | 211,760(2) | N/A | (95,754) | 1,237,012(2) | N/A | ||||||||||||||||||||
Shares Outstanding, Beginning of Period | 211,760 | – | N/A | 1,237,012 | – | N/A | ||||||||||||||||||||
Shares Outstanding, End of Period | 198,267 | 211,760 | N/A | 1,141,258 | 1,237,012 | N/A | ||||||||||||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||||||||||||||
Shares sold | 1,581 | 22,511 | 102,392 | 44,418 | 218,277 | 697,726 | ||||||||||||||||||||
Shares reorganized in connection with restructuring (Note 9) | – | (214,931) | N/A | – | (1,291,105) | N/A | ||||||||||||||||||||
Reinvested dividends and distributions | 4 | 3 | 242 | 31 | 18 | 3,100 | ||||||||||||||||||||
Shares repurchased | (1,932) | (31,658) | (186,385) | (41,923) | (278,694) | (1,166,590) | ||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (347) | (224,075) | (83,751) | 2,526 | (1,351,504) | (465,764) | ||||||||||||||||||||
Shares Outstanding, Beginning of Period | 4,442 | 228,517 | 312,268 | 166,232 | 1,517,736 | 1,983,500 | ||||||||||||||||||||
Shares Outstanding, End of Period | 4,095 | 4,442 | 228,517 | 168,758 | 166,232 | 1,517,736 |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Transactions in Fund Shares for Class D Shares are for the period from February 16, 2010 (inception date) to June 30, 2010. |
8. | Purchases and Sales of Investment Securities |
For the period ended December 31, 2010, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities and short-term options contracts) was as follows:
Purchases of Long- | Proceeds from Sales | |||||||||||||
Purchases of | Proceeds from Sales | Term U.S. Government | of Long-Term U.S. | |||||||||||
Fund | Securities | of Securities | Obligations | Government Obligations | ||||||||||
Fixed Income | ||||||||||||||
Janus Flexible Bond Fund | $ | 1,776,441,573 | $ | 1,102,036,852 | $ | 891,868,624 | $ | 991,572,860 | ||||||
Janus High-Yield Fund | 880,442,243 | 651,932,748 | – | – | ||||||||||
Janus Short-Term Bond Fund | 1,134,841,482 | 488,532,359 | 761,827,165 | 1,235,302,421 | ||||||||||
9. | Shares Issued in Connection with Restructuring |
Effective February 16, 2010, Class J Shares were renamed Class T Shares and are available through certain financial intermediary platforms. In addition, Class J Shares held directly with Janus were moved to newly
112 | DECEMBER 31, 2010
Table of Contents
created Class D Shares, a share class dedicated to shareholders investing directly with Janus. Class D Shares commenced operations on February 16, 2010. The shares issued in connection with the restructuring from Class J Shares to Class D Shares are reflected on the Statements of Changes in Net Assets and in the Capital Share Transactions table in Note 7.
10. | Fund Acquisition |
On July 6, 2009, Janus Flexible Bond Fund and Janus High-Yield Fund acquired all of the net assets of Janus Adviser Flexible Bond Fund and Janus Adviser High-Yield Fund, respectively, pursuant to separate plans of reorganization approved by the Trustees of the Trust. The reorganization involved certain funds that were a series of the Janus Adviser Series trust (“JAD Trust”) being merged into corresponding funds of the Trust. The reorganization was accomplished by a tax-free exchange of the series of the JAD Trust for the series of the Trust. The table below reflects the merger activity.
Target Fund’s | ||||||||||||||||||||||||
Unrealized | ||||||||||||||||||||||||
Target Fund’s | Target Fund’s | Acquiring Fund’s | Acquiring Fund’s | Combined | Appreciation/ | |||||||||||||||||||
Shares Outstanding | Net Assets | Shares Issued | Net Assets | Net Assets | (Depreciation) | |||||||||||||||||||
Fund | Prior to Merger | Prior to Merger | in Merger | Prior to Merger | after Merger | Prior to Merger | ||||||||||||||||||
Fixed Income | ||||||||||||||||||||||||
Janus Flexible Bond Fund | 40,252,957 | $ | 502,967,658 | 50,427,335 | $ | 948,343,596 | $ | 1,451,311,254 | $ | (13,275,300 | ) | |||||||||||||
Janus High-Yield Fund | 14,642,660 | 111,693,397 | 14,681,438 | 653,584,506 | 765,277,903 | (3,617,428 | ) | |||||||||||||||||
11. | Pending Legal Matters |
In the fall of 2003, the Securities and Exchange Commission (“SEC”), the Office of the New York State Attorney General (“NYAG”), the Colorado Attorney General (“COAG”), and the Colorado Division of Securities (“CDS”) announced that they were investigating alleged frequent trading practices in the mutual fund industry. On August 18, 2004, Janus Capital announced that it had reached final settlements with the SEC, the NYAG, the COAG, and the CDS related to such regulators’ investigations into Janus Capital’s frequent trading arrangements.
A number of civil lawsuits were brought in several state and federal jurisdictions against Janus Capital and certain of its affiliates, the Janus funds, and related entities and individuals based on allegations similar to those announced by the above regulators. Such lawsuits alleged a variety of theories for recovery including, but not limited to, the federal securities laws, other federal statutes (including ERISA), and various common law doctrines. The Judicial Panel on Multidistrict Litigation transferred these actions to the U.S. District Court for the District of Maryland (the “Court”) for coordinated proceedings. On September 29, 2004, five consolidated amended complaints were filed with the Court, two of which still remain: (i) claims by a putative class of shareholders of Janus Capital Group Inc. (“JCGI”) asserting claims on behalf of the shareholders against JCGI and Janus Capital (First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S. District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins, et al. v. Janus Capital Group, Inc., et al., U.S. District Court, District of Maryland, Case No. 04-CV-00818); and (ii) derivative claims by investors in certain Janus funds ostensibly on behalf of such funds (Steinberg et al. v. Janus Capital Management, LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518).
In the First Derivative Traders case (action (i) above), a Motion to Dismiss was previously granted and the matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the United States Court of Appeals for the Fourth Circuit (“Fourth Circuit”). In May 2009, the Fourth Circuit reversed the order of dismissal and remanded the case back to the trial court for further proceedings. In June 2010, the United States Supreme Court agreed to review the Fourth Circuit’s decision. As a result of these developments at the Supreme Court, the trial court has stayed all further proceedings until the Supreme Court rules on the matter. In the Steinberg case (action (ii) above), the trial court entered an order on January 20, 2010, granting Janus Capital’s Motion for Summary Judgment and dismissing the remaining claims asserted against the company. However, in February 2010, Plaintiffs appealed the trial court’s decision with the Fourth Circuit.
Additional lawsuits may be filed against certain of the Janus funds, Janus Capital, and related parties in the future. Janus Capital does not currently believe that these pending actions will materially affect its ability to continue providing services it has agreed to provide to the Janus funds.
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Notes to Financial Statements (unaudited) (continued)
12. | New Accounting Pronouncements |
In January 2010, the FASB issued Accounting Standards Update, “Improving Disclosures About Fair Value Measurements.” The Accounting Standards Update requires disclosures about purchases, sales, issuances, and settlements on a gross basis relating to Level 3 measurements. This disclosure will become effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact the adoption of this Accounting Standards Update will have on the Funds’ financial statement disclosures.
13. | Subsequent Event |
Management has evaluated whether any events or transactions occurred subsequent to December 31, 2010 and through the date of issuance of the Funds’ financial statements and determined that there were no material events or transactions that would require recognition or disclosure in the Funds’ financial statements.
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Additional Information (unaudited)
Proxy Voting Policies and Voting Record
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to their portfolio securities is available without charge: (i) upon request, by calling 1-800-525-0020 (toll free); (ii) on the Funds’ website at janus.com/proxyvoting; and (iii) on the SEC’s website at http://www.sec.gov. Additionally, information regarding each Fund’s proxy voting record for the most recent twelve-month period ended June 30 is also available, free of charge, through janus.com/proxyvoting and from the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Holdings
The Funds file their complete portfolio holdings (schedule of investments) with the SEC for the first and third quarters of each fiscal year on Form N-Q within 60 days of the end of such fiscal quarter. The Funds’ Form N-Q: (i) is available on the SEC’s website at http://www.sec.gov; (ii) may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the Public Reference Room may be obtained by calling 1-800-SEC-0330); and (iii) is available without charge, upon request, by calling Janus at 1-800-525-0020 (toll free).
Approval of Advisory Agreements During The Period
The Trustees of Janus Investment Fund, none of whom has ever been affiliated with Janus Capital (“Independent Trustees”), oversee the management of each Fund and, as required by law, determine annually whether to continue the investment advisory agreement for each Fund and the subadvisory agreements for the nine Funds that utilize subadvisers.
In connection with their most recent consideration of those agreements for each Fund, the Trustees received and reviewed a substantial amount of information provided by Janus Capital and the respective subadvisers in response to requests of the Independent Trustees and their independent legal counsel. They also received and reviewed a considerable amount of information and analysis provided by their independent fee consultant. Throughout their consideration of the agreements, the Independent Trustees were advised by their independent legal counsel. The Independent Trustees met with management to consider the agreements, and also met separately in executive session with their independent legal counsel and their independent fee consultant.
At a meeting held on December 3, 2010, based on the Trustees’ evaluation of the information provided by Janus Capital, the subadvisers and the independent fee consultant, as well as other information, the Trustees determined that the overall arrangements between each Fund and Janus Capital and each subadviser, as applicable, were fair and reasonable in light of the nature, extent and quality of the services provided by Janus Capital, its affiliates and the subadvisers, the fees charged for those services, and other matters that the Trustees considered relevant in the exercise of their business judgment. At that meeting, the Trustees unanimously approved the continuation of the investment advisory agreement for each Fund, and the subadvisory agreement for each subadvised Fund, for the period from February 1, 2011 through February 1, 2012, subject to earlier termination as provided for in each agreement.
In considering the continuation of those agreements, the Trustees reviewed and analyzed various factors that they determined were relevant, including the factors described below, none of which by itself was considered dispositive. However, the material factors and conclusions that formed the basis for the Trustees’ determination to approve the continuation of the agreements are discussed separately below.
Nature, Extent and Quality of Services
The Trustees reviewed the nature, extent and quality of the services provided by Janus Capital and the subadvisers to the Funds, taking into account the investment objective and strategy of each Fund and the knowledge the Trustees gained from their regular meetings with management on at least a quarterly basis and their ongoing review of information related to the Funds. In addition, the Trustees reviewed the resources and key personnel of Janus Capital and each subadviser, particularly noting those employees who provide investment management services to the Funds. The Trustees also considered other services provided to the Funds by Janus Capital or the subadvisers, such as managing the execution of portfolio transactions and the selection of broker-dealers for those transactions, serving as the Funds’ administrator, monitoring adherence to the Funds’ investment restrictions, producing shareholder reports, providing support services for the Trustees and Trustee committees, communicating with shareholders and overseeing the activities of other service providers, including monitoring compliance with various policies and procedures of the Funds and with applicable securities laws and regulations.
The Trustees concluded that the nature, extent and quality of the services provided by Janus Capital or the subadviser to each Fund were appropriate and consistent with the terms of the respective advisory and subadvisory agreements, and that, taking into account steps taken to address those Funds whose performance lagged that of
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Additional Information (unaudited) (continued)
their peers for certain periods, the quality of those services had been consistent with or superior to quality norms in the industry and the Funds were likely to benefit from the continued provision of those services. They also concluded that Janus Capital and each subadviser had sufficient personnel, with the appropriate education and experience, to serve the Funds effectively and had demonstrated its continuing ability to attract well-qualified personnel.
Performance of the Funds
The Trustees considered the performance results of each Fund over various time periods. They reviewed information comparing each Fund’s performance with the performance of comparable funds and peer groups identified by Lipper, and with the Fund’s benchmark index. They concluded that the performance of many Funds was good to very good under current market conditions. Although the performance of some Funds lagged that of their peers for certain periods, the Trustees also concluded that Janus Capital had taken or was taking appropriate steps to address those instances of under-performance.
Costs of Services Provided
The Trustees examined information regarding the fees and expenses of each Fund in comparison to similar information for other comparable funds as provided by Lipper. They also reviewed an analysis of that information provided by their independent fee consultant and noted that the rate of management (investment advisory and administrative) fees for most of the Funds, after applicable contractual expense limitations, was below the mean management fee rate of the respective peer group of funds selected by Lipper.
The Trustees considered the methodology used by Janus Capital and each subadviser in determining compensation payable to portfolio managers, the competitive environment for investment management talent and the competitive market for mutual funds in different distribution channels. They concluded that the compensation methodology provided a good alignment of the interests of the portfolio managers with the interests of Fund shareholders.
The Trustees also reviewed management fees charged by Janus Capital to its separate account clients and to non-affiliated funds subadvised by Janus Capital (for which Janus Capital provides only portfolio management services). Although in most instances subadvisory and separate account fee rates for various investment strategies were lower than management fee rates for Funds having a similar strategy, the Trustees noted that, under the terms of the management agreements with the Funds, Janus Capital performs significant additional services for the Funds that it does not provide to those other clients, including administrative services, oversight of the Funds’ other service providers, trustee support, regulatory compliance and numerous other services, and that, in serving the Funds, Janus Capital assumes many legal risks that it does not assume in servicing its other clients. Moreover, they noted that the spread between the average fee rates charged to the Funds and the fee rates that Janus Capital charged to its separate account clients was significantly smaller than the average spread for such fee rates of other advisers, based on publicly available data and research conducted by the Trustees’ independent fee consultant.
The Trustees reviewed information on the profitability to Janus Capital and its affiliates of their relationships with each Fund, as well as an explanation of the methodology utilized in allocating various expenses of Janus Capital and its affiliates among the Funds and other clients. The Trustees also reviewed the financial statements and corporate structure of Janus Capital’s parent company. In their review, the Trustees considered whether Janus Capital and each subadviser receive adequate incentives to manage the Funds effectively. The Trustees recognized that profitability comparisons among fund managers are difficult because very little comparative information is publicly available and the profitability of any fund manager is affected by numerous factors, including the organizational structure of the particular fund manager, the types of funds and other accounts it manages, possible other lines of business, the methodology for allocating expenses and the fund manager’s capital structure and cost of capital. However, taking into account those factors and the analysis provided by the Trustees’ independent fee consultant, and based on the information available, the Trustees concluded that Janus Capital’s profitability with respect to each Fund in relation to the services rendered was not unreasonable.
The Trustees concluded that the management fees and other compensation payable by each Fund to Janus Capital and its affiliates, as well as the fees paid by Janus Capital to the subadvisers of subadvised Funds, were reasonable in relation to the nature, extent and quality of the services provided, taking into account the fees charged by other advisers for managing comparable mutual funds with similar strategies and the fees Janus Capital and the subadvisers charge to other clients. The Trustees also concluded that the overall expense ratio of each Fund was reasonable, taking into account the size of the Fund, the quality of services provided by Janus Capital and any subadviser, the investment performance of the Fund and any expense limitations agreed to by Janus Capital.
Economies of Scale
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The Trustees considered information about the potential for Janus Capital to realize economies of scale as the assets of the Funds increase. They noted that, although many Funds pay advisory fees at a fixed rate as a percentage of net assets, without any breakpoints, the actual management fee rate paid by each Fund, after any contractual expense limitations, was below the mean management fee rate of the Fund’s peer group identified by Lipper; and, for those Funds whose expenses are being reduced by the contractual expense limitations of Janus Capital, Janus Capital is subsidizing the Funds because they have not reached adequate scale. Moreover, as the assets of many of the Funds have declined in the past few years, the Funds have benefited from having advisory fee rates that have remained constant rather than increasing as assets declined. In addition, performance fee structures have been implemented for several Funds that have caused or will cause the effective rate of advisory fees payable by such a Fund to vary depending on the investment performance of the Fund relative to its benchmark index over the measurement period; and a few Funds have fee schedules with breakpoints and reduced fee rates above certain asset levels. The Trustees also noted that the Funds share directly in economies of scale through the lower charges of third-party service providers that are based in part on the combined scale of all of the Funds. Based on all of the information they reviewed, including research and analysis conduct by the Trustees’ Independent Fee Consultant, the Trustees concluded that the current fee structure of each Fund was reasonable and that the current rates of fees do reflect a sharing between Janus Capital and the Fund of economies of scale at the current asset level of the Fund.
Other Benefits to Janus Capital
The Trustees also considered benefits that accrue to Janus Capital and its affiliates from their relationships with the Funds. They recognized that two affiliates of Janus Capital separately serve the Funds as transfer agent and distributor, respectively, and the transfer agent receives compensation directly from the non-money market funds for services provided. The Trustees also considered Janus Capital’s past and proposed use of commissions paid by the Funds on their portfolio brokerage transactions to obtain proprietary and third-party research products and services benefiting the Fund and/or other clients of Janus Capital. The Trustees concluded that Janus Capital’s use of these types of client commission arrangements to obtain proprietary and third-party research products and services was consistent with regulatory requirements and guidelines and was likely to benefit each Fund. The Trustees also concluded that, other than the services provided by Janus Capital and its affiliates pursuant to the agreements and the fees to be paid by each Fund therefor, the Funds and Janus Capital may potentially benefit from their relationship with each other in other ways. They concluded that Janus Capital benefits from the receipt of research products and services acquired through commissions paid on portfolio transactions of the Funds and that the Funds benefit from Janus Capital’s receipt of those products and services as well as research products and services acquired through commissions paid by other clients of Janus Capital. They further concluded that success of any Fund could attract other business to Janus Capital or other Janus funds, and that the success of Janus Capital could enhance Janus Capital’s ability to serve the Funds.
After full consideration of the above factors, as well as other factors, the Trustees, each of whom is an Independent Trustee, concluded at their December 3, 2010 meeting that the proposed continuation of the investment advisory agreement and, if applicable, the subadvisory agreement for each Fund for another year was in the best interest of the respective Funds and their shareholders.
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Explanations of Charts, Tables and
Financial Statements (unaudited)
Financial Statements (unaudited)
1. | Performance Overviews |
Performance overview graphs compare the performance of a hypothetical $10,000 investment in each Fund (from inception) with one or more widely used market indices. The hypothetical example does not represent the returns of any particular investment.
When comparing the performance of a Fund with an index, keep in mind that market indices do not include brokerage commissions that would be incurred if you purchased the individual securities in the index. They also do not include taxes payable on dividends and interest or operating expenses incurred if you maintained a Fund invested in the index.
Average annual total returns are also quoted for each Fund. Average annual total return is calculated by taking the growth or decline in value of an investment over a period of time, including reinvestment of dividends and distributions, then calculating the annual compounded percentage rate that would have produced the same result had the rate of growth been constant throughout the period. Average annual total return does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares.
Pursuant to federal securities rules, expense ratios shown in the performance chart reflect subsidized and unsubsidized ratios for the prior fiscal year. The total annual fund operating expenses ratio is gross of any fee waivers, reflecting a Fund’s unsubsidized expense ratio. The net annual fund operating expenses ratio (if applicable) includes contractual waivers of Janus Capital and/or Janus Services and reflects a Fund’s subsidized expense ratio. Both the total annual fund operating expenses ratio and net annual fund operating expenses ratio are based on average net assets as of the fiscal period ended June 30, 2010 for all Funds except Janus Global Bond Fund, which are estimated for the fiscal year. The ratios also include expenses indirectly incurred by a Fund as a result of investing in other investment companies or pooled investments, which are not reflected in the “Financial Highlights” of this report. As a result, these ratios may be higher or lower than those shown in the “Financial Highlights” in this report. All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
2. | Schedules of Investments |
Following the performance overview section is each Fund’s Schedule of Investments. This schedule reports the industry concentrations and types of securities held in each Fund on the last day of the reporting period. Securities are usually listed by type (common stock, corporate bonds, U.S. Government obligations, etc.) and by industry classification (banking, communications, insurance, etc.). Holdings are subject to change without notice.
The value of each security is quoted as of the last day of the reporting period. The value of securities denominated in foreign currencies is converted into U.S. dollars.
If a Fund invests in foreign securities, it will also provide a summary of investments by country. This summary reports each Fund’s exposure to different countries by providing the percentage of securities invested in each country. The country of each security represents the country in which the company is incorporated. Each Fund’s Schedule of Investments relies upon the industry group and country classifications published by Bloomberg L.P.
2a. Forward Currency Contracts
A table listing forward currency contracts follows each Fund’s Schedule of Investments (if applicable). Forward currency contracts are agreements to deliver or receive a preset amount of currency at a future date. Forward currency contracts are used to hedge against foreign currency risk in the Funds’ long-term holdings.
The table provides the name of the foreign currency, the settlement date of the contract, the amount of the contract, the value of the currency in U.S. dollars and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the change in currency exchange rates from the time the contract was opened to the last day of the reporting period.
2b. Futures
A table listing futures contracts follows each Fund’s Schedule of Investments (if applicable). Futures contracts are contracts that obligate the buyer to receive and the seller to deliver an instrument or money at a specified price on a specified date. Futures are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, the principal amount, value and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the marked-to-market amount for the last day of the reporting period.
2c. Options
A table listing written options contracts follows each Fund’s Schedule of Investments (if applicable). Written options contracts are contracts that obligate a Fund to sell or purchase an underlying security at a fixed price, upon
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exercise of the option. Options are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, exercise price, value and premiums received.
3. | Statements of Assets and Liabilities |
These statements are often referred to as the “balance sheets.” It lists the assets and liabilities of the Funds on the last day of the reporting period.
The Funds’ assets are calculated by adding the value of the securities owned, the receivable for securities sold but not yet settled, the receivable for dividends declared but not yet received on stocks owned and the receivable for Fund shares sold to investors but not yet settled. The Funds’ liabilities include payables for securities purchased but not yet settled, Fund shares redeemed but not yet paid and expenses owed but not yet paid. Additionally, there may be other assets and liabilities such as unrealized gain or loss on forward currency contracts.
The section entitled “Net Assets Consist of” breaks down the components of the Funds’ net assets. Because the Funds must distribute substantially all earnings, you will notice that a significant portion of net assets is shareholder capital.
The last section of this statement reports the net asset value (“NAV”) per share on the last day of the reporting period. The NAV is calculated by dividing the Funds’ net assets (assets minus liabilities) by the number of shares outstanding.
4. | Statements of Operations |
These statements detail the Funds’ income, expenses, gains and losses on securities and currency transactions, and appreciation or depreciation of current Fund holdings.
The first section in this statement, entitled “Investment Income,” reports the dividends earned from stocks and interest earned from interest-bearing securities in the Funds.
The next section reports the expenses incurred by the Funds, including the advisory fee paid to the investment adviser, transfer agent fees and expenses, and printing and postage for mailing statements, financial reports and prospectuses. Expense offsets and expense reimbursements, if any, are also shown.
The last section lists the increase or decrease in the value of securities held in the Funds. The Funds will realize a gain (or loss) when they sell their position in a particular security. An unrealized gain (or loss) refers to the change in net appreciation or depreciation of the Funds during the reporting period. “Net Realized and Unrealized Gain/(Loss) on Investments” is affected both by changes in the market value of Fund holdings and by gains (or losses) realized during the reporting period.
5. | Statements of Changes in Net Assets |
These statements report the increase or decrease in the Funds’ net assets during the reporting period. Changes in the Funds’ net assets are attributable to investment operations, dividends, distributions and capital share transactions. This is important to investors because it shows exactly what caused the Funds’ net asset size to change during the period.
The first section summarizes the information from the Statements of Operations regarding changes in net assets due to the Funds’ investment performance. The Funds’ net assets may also change as a result of dividend and capital gains distributions to investors. If investors receive their dividends in cash, money is taken out of the Funds to pay the distribution. If investors reinvest their dividends, the Funds’ net assets will not be affected. If you compare each Fund’s “Net Decrease from Dividends and Distributions” to the “Reinvested dividends and distributions,” you will notice that dividend distributions had little effect on each Fund’s net assets. This is because the majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under “Capital Share Transactions.” “Capital Shares” refers to the money investors contribute to the Funds through purchases or withdrawals via redemptions. “Redemption Fees” (if applicable) refers to the fee paid to the Funds for shares held for 90 days or less by a shareholder. The Funds’ net assets will increase and decrease in value as investors purchase and redeem shares from the Funds.
6. | Financial Highlights |
This schedule provides a per-share breakdown of the components that affect each Fund’s NAV for current and past reporting periods. Not only does this table provide you with total return, it also reports total distributions, asset size, expense ratios and portfolio turnover rate.
The first line in the table reflects the NAV per share at the beginning of the reporting period. The next line reports the net investment income per share, which comprises dividends and interest income earned on securities held by the Funds. Following is the total of gains/(losses), realized and unrealized. Dividends and distributions are then subtracted to arrive at the NAV per share at the end of the period. The next line reflects the average annual
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Explanations of Charts, Tables and
Financial Statements (unaudited) (continued)
Financial Statements (unaudited) (continued)
total return reported the last day of the period. The total return may include adjustments in accordance with generally accepted accounting principles. As a result, the total return may differ from the total return reflected for shareholder transactions.
Also included are the expense ratios, or the percentage of average net assets that were used to cover operating expenses during the period. Expense ratios vary across the Funds within the Trust for a number of reasons, including the differences in management fees, the frequency of dividend payments and the extent of foreign investments, which entail greater transaction costs.
The Funds’ expenses may be reduced through expense-reduction arrangements. These arrangements may include the use of balance credits or transfer agent fee offsets. The Statements of Operations reflect total expenses before any such offset, the amount of the offset and the net expenses. The expense ratios listed in the Financial Highlights reflect total expenses prior to any expense offset (gross expense ratio) and after the expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursements), if applicable.
The ratio of net investment income/(loss) summarizes the income earned less expenses, divided by the average net assets of a Fund during the reporting period. Don’t confuse this ratio with a Fund’s yield. The net investment income ratio is not a true measure of a Fund’s yield because it doesn’t take into account the dividends distributed to the Fund’s investors.
The next figure is the portfolio turnover rate, which measures the buying and selling activity in a Fund. Portfolio turnover is affected by market conditions, changes in the asset size of a Fund, the nature of the Fund’s investments and the investment style of the portfolio manager. A 100% rate implies that an amount equal to the value of the entire portfolio is turned over in a year; a 50% rate means that an amount equal to the value of half the portfolio is traded in a year; and a 200% rate means that an amount equal to the value of the portfolio is traded every six months.
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Notes
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Janus provides access to a wide range of investment disciplines.
Alternative
Janus alternative funds seek to deliver strong risk-adjusted returns over a full market cycle with lower correlation to equity markets than traditional investments.
Asset Allocation
Janus’ asset allocation funds utilize our fundamental, bottom-up research to balance risk over the long term. From fund options that meet investors’ risk tolerance and objectives to a method that incorporates non-traditional investment choices to seek non-correlated sources of risk and return, Janus’ asset allocation funds aim to allocate risk more effectively.
Core
Janus core funds seek investments in more stable and predictable companies. These funds look for a strategic combination of steady growth and for certain funds, some degree of income.
Fixed Income
Janus fixed income funds attempt to provide less risk relative to equities while seeking to deliver a competitive total return through high current income and appreciation. Janus money market funds seek capital preservation and liquidity with current income as a secondary objective.
Global & International
Janus global and international funds seek to leverage Janus’ research capabilities by taking advantage of inefficiencies in foreign markets, where accurate information and analytical insight are often at a premium.
Growth
Janus growth funds focus on companies believed to be the leaders in their respective industries, with solid management teams, expanding market share, margins and efficiencies.
Risk Managed
Our risk-managed funds seek to outperform their respective indices while maintaining a risk profile equal to or lower than the index itself. Managed by INTECH (a Janus subsidiary), these funds use a mathematical process in an attempt to build a more “efficient” portfolio than the index.
Value
Janus value funds invest in companies they believe are poised for a turnaround or are trading at a significant discount to fair value. The goal is to gain unique insight into a company’s true value and identify and evaluate potential catalysts that may unlock shareholder value.
For more information about our funds, contact your investment professional or go to janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus).
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Please consider the charges, risks, expenses and investment objectives carefully before investing or recommending to clients for investment. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus); or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus). Read it carefully before you invest or send money.
Janus Distributors LLC 151 Detroit Street, Denver, CO 80206 (02/11)
Investment products offered are: NOT FDIC-INSURED MAY LOSE VALUE NO BANK GUARANTEE
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Table of Contents
2010 SEMIANNUAL REPORT
Janus Risk-Managed Funds
INTECH Risk-Managed Growth Fund
INTECH Risk-Managed International Fund
INTECH Risk-Managed Value Fund
HIGHLIGHTS
• | Portfolio management perspective |
• | Investment strategy behind your fund |
• | Fund performance, characteristics and holdings |
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Janus Risk-Managed Funds
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Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS(52687) (or 800.525.3713 if you hold Shares directly with Janus Capital). You can also visit janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
Table of Contents
Useful Information About Your Fund Report (unaudited)
Management Commentaries
The Management Commentaries in this report include valuable insight from each of the Funds’ investment personnel as well as statistical information to help you understand how your Fund’s performance and characteristics stack up against those of comparable indices.
If a Fund invests in foreign securities, this report may include information about country exposure. Country exposure is based primarily on the country of domicile. However, the Funds’ investment personnel may allocate a company to a country based on other factors such as location of the company’s principal office, the location of the principal trading market for the company’s securities, or the country where a majority of the company’s revenues are derived.
Please keep in mind that the opinions expressed by the Funds’ investment personnel in the Management Commentaries are just that: opinions. They are a reflection of the investment personnel’s best judgment at the time this report was compiled, which was December 31, 2010. As the investing environment changes, so could the investment personnel’s opinions. These views are unique to the investment personnel and aren’t necessarily shared by fellow employees or by Janus in general.
Fund Expenses
We believe it’s important for our shareholders to have a clear understanding of Fund expenses and the impact they have on investment return.
The following is important information regarding each Fund’s Expense Example, which appears in each Fund’s Management Commentary within this Semiannual Report. Please refer to this information when reviewing the Expense Example for each Fund.
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (applicable to Class A Shares only); redemption fees, where applicable (and any related exchange fees); and (2) ongoing costs, including management fees; distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only); administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares only); administrative, networking or omnibus fees (applicable to Class A Shares, Class C Shares, and Class I Shares only); and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The example is based upon an investment of $1,000 invested at the beginning of the period and held for the six-month period from July 1, 2010 to December 31, 2010.
Actual Expenses
The first line of the table in each example provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
The second line of the table in each example provides information about hypothetical account values and hypothetical expenses based upon each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Janus Capital Management LLC (“Janus Capital”) has contractually agreed to waive each Fund’s total annual fund operating expenses, excluding any performance adjustments to management fees, if applicable, class-specific distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, and Class S Shares only), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares only), brokerage commissions, interest, dividends, taxes, and extraordinary expenses, including, but not limited to, acquired fund fees and expenses, to certain limits until at least November 1, 2011. Expenses in the examples reflect application of these waivers. Had the
Janus Risk-Managed Funds | 1
Table of Contents
waivers not been in effect, your expenses would have been higher. More information regarding the waivers is available in the Funds’ prospectuses.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as redemption fees (where applicable) and any related exchange fees. These fees are fully described in the Funds’ prospectuses. Therefore, the second line of each table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
2 | DECEMBER 31, 2010
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INTECH Risk-Managed Core Fund (unaudited)
Fund Snapshot This fund uses a mathematically-based investment process that seeks to capitalize on the natural volatility of stock prices. The primary aim of this strategy is to outperform the benchmark index without increasing risk. | Managed by INTECH Investment Management LLC |
Performance Overview
For the six-month period ended December 31, 2010, INTECH Risk-Managed Core Fund’s Class T Shares returned 23.53%. This compares to the 23.27% return posted by the S&P 500 Index, the Fund’s benchmark.
Investment Strategy in This Environment
While INTECH does not employ fundamental analysis in the management of the Fund, fundamentals can have a significant impact on the general direction of the market in which we participate. The Fund’s goal is to produce long-term returns in excess of its benchmark with an equal or lesser amount of risk.
INTECH’s mathematical investment process seeks to build a more efficient portfolio than its benchmark, the S&P 500 Index. With a focus on risk management, investment decisions are governed by a mathematical investment process. The process does not attempt to predict the direction of the market, nor does it have a particular view of any stock in the Fund.
Performance Review
As stock prices moved naturally throughout the period, we continued to implement our mathematical process in a disciplined manner in an effort to maintain a more efficient portfolio than the benchmark, without increasing relative risk. While other factors may influence performance over the short term, we believe that the consistent application of our process will help the Fund perform well over the long term.
In INTECH’s history, which spans more than 23 years, we have experienced periods of both underperformance and outperformance relative to the benchmark. From our perspective, the key is to keep periods of underperformance both short in duration and mild in scope. INTECH aims to achieve excess returns over the long term and we believe the Fund remains well positioned for long-term capital growth.
Investment Strategy and Outlook
INTECH’s mathematical, risk-managed investment process seeks to outperform the S&P 500 Index over the long term, while attempting to manage risk relative to the benchmark. We will continue implementing the process in a disciplined and deliberate manner in an effort to achieve our long-term performance goals. The Fund may underperform during shorter time periods, but has the goal of outperformance over the long term. Risk management remains essential to the investment process. We will continue to make marginal improvements to the mathematical process, seeking an efficient portfolio that offers better long-term results than the benchmark, regardless of the market’s direction.
Thank you for your investment in INTECH Risk-Managed Core Fund.
Janus Risk-Managed Funds | 3
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INTECH Risk-Managed Core Fund (unaudited)
INTECH Risk-Managed Core Fund At A Glance
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
Apple, Inc. Computers | 4.9% | |||
Cognizant Technology Solutions Corp. Computer Services | 2.6% | |||
Stanley Works Tools – Hand Held | 2.5% | |||
Estee Lauder Cos., Inc. – Class A Cosmetics and Toiletries | 2.4% | |||
Google, Inc. – Class A Web Portals/Internet Service Providers | 2.0% | |||
14.4% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29p04.gif)
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29t04.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29c04.gif)
4 | DECEMBER 31, 2010
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(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29m04.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
INTECH Risk-Managed Core Fund – Class A Shares | |||||||||||||
NAV | 23.54% | 16.07% | 1.17% | 7.85% | 1.15% | 1.06% | |||||||
MOP | 16.48% | 9.36% | –0.02% | 7.03% | |||||||||
INTECH Risk-Managed Core Fund – Class C Shares | |||||||||||||
NAV | 22.89% | 15.35% | 0.44% | 7.06% | 1.56% | 1.56% | |||||||
CDSC | 21.66% | 14.19% | 0.44% | 7.06% | |||||||||
INTECH Risk-Managed Core Fund – Class D Shares(1) | 23.52% | 16.38% | 1.46% | 8.17% | 0.58% | 0.58% | |||||||
INTECH Risk-Managed Core Fund – Class I Shares | 23.64% | 16.59% | 1.44% | 8.16% | 0.53% | 0.53% | |||||||
INTECH Risk-Managed Core Fund – Class S Shares | 23.31% | 16.07% | 1.00% | 7.65% | 1.03% | 1.03% | |||||||
INTECH Risk-Managed Core Fund – Class T Shares | 23.53% | 16.28% | 1.44% | 8.16% | 0.82% | 0.82% | |||||||
S&P 500® Index | 23.27% | 15.06% | 2.29% | 7.38% | |||||||||
Lipper Quartile – Class T Shares | – | 2nd | 3rd | 2nd | |||||||||
Lipper Ranking – based on total returns for Multi-Cap Core Funds | – | 342/816 | 410/594 | 185/373 | |||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
See important disclosures on the next page.
Janus Risk-Managed Funds | 5
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INTECH Risk-Managed Core Fund (unaudited)
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
For Class D Shares, Class I Shares, Class S Shares, and Class T Shares, a 2% redemption fee may be imposed on shares held for 90 days or less. Performance shown does not reflect this redemption fee and, if reflected, performance would have been lower.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any performance adjustments to management fees, distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares, and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The voluntary waiver of the Fund’s management fee terminated June 25, 2004. Without such waivers, total returns from inception to June 25, 2004 would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund has a performance-based management fee that adjusts up or down based on the Fund’s performance relative to an approved benchmark index over a performance measurement period. See the Fund’s Prospectus or Statement of Additional Information for more details.
The proprietary mathematical process used by INTECH Investment Management LLC (“INTECH”) may not achieve the desired results. The rebalancing techniques used by the Fund may result in a higher portfolio turnover rate, higher expenses and potentially higher net taxable gains or losses compared to a “buy and hold” or index fund strategy.
The Fund’s performance may be affected by risks that include those associated with investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Effective February 16, 2010, INTECH Risk-Managed Core Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, and Class S Shares commenced operations on July 6, 2009. The performance shown for each class for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. If each class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective class may have been different. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares, the predecessor share class. The performance shown for Class D Shares for periods prior to February 16, 2010 reflects the performance of the Fund’s former Class J Shares. If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares commenced operations on July 6, 2009. Performance shown for periods prior to July 6, 2009, reflects the performance of the Fund’s Class J Shares, the initial share class, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
6 | DECEMBER 31, 2010
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(unaudited)
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The weighting of securities within the portfolio may differ significantly from the weightings within the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The Fund’s inception date – February 28, 2003 | |
(1) | Closed to new investors. |
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,234.50 | $ | 6.14 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.71 | $ | 5.55 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,228.90 | $ | 10.84 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,015.48 | $ | 9.80 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,236.40 | $ | 5.36 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.42 | $ | 4.84 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,236.40 | $ | 4.68 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.02 | $ | 4.23 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,233.10 | $ | 7.26 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.70 | $ | 6.56 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,235.30 | $ | 5.86 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.96 | $ | 5.30 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.09% for Class A Shares, 1.93% for Class C Shares, 0.95% for Class D Shares, 0.83% for Class I Shares, 1.29% for Class S Shares and 1.04% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Risk-Managed Funds | 7
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INTECH Risk-Managed Core Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Common Stock – 99.7% | ||||||||||
Advertising Agencies – 0.1% | ||||||||||
18,500 | Interpublic Group of Cos., Inc.* | $ | 196,470 | |||||||
Aerospace and Defense – 2.0% | ||||||||||
27,600 | Boeing Co. | 1,801,176 | ||||||||
49,800 | Northrop Grumman Corp. | 3,226,044 | ||||||||
15,300 | Rockwell Collins, Inc. | 891,378 | ||||||||
5,918,598 | ||||||||||
Aerospace and Defense – Equipment – 0.5% | ||||||||||
2,000 | B.F. Goodrich Co. | 176,140 | ||||||||
17,100 | United Technologies Corp. | 1,346,112 | ||||||||
1,522,252 | ||||||||||
Agricultural Chemicals – 0.2% | ||||||||||
1,700 | CF Industries Holdings, Inc. | 229,755 | ||||||||
3,700 | Monsanto Co. | 257,668 | ||||||||
487,423 | ||||||||||
Agricultural Operations – 0.1% | ||||||||||
14,300 | Archer-Daniels-Midland Co. | 430,144 | ||||||||
Airlines – 0.8% | ||||||||||
191,100 | Southwest Airlines Co. | 2,480,478 | ||||||||
Appliances – 0.4% | ||||||||||
12,600 | Whirlpool Corp. | 1,119,258 | ||||||||
Applications Software – 2.1% | ||||||||||
1,300 | Citrix Systems, Inc.* | 88,933 | ||||||||
44,500 | Intuit, Inc.* | 2,193,850 | ||||||||
66,000 | Microsoft Corp. | 1,842,720 | ||||||||
4,200 | Red Hat, Inc.* | 191,730 | ||||||||
15,300 | Salesforce.com, Inc.* | 2,019,600 | ||||||||
6,336,833 | ||||||||||
Athletic Footwear – 0.1% | ||||||||||
1,900 | NIKE, Inc. – Class B | 162,298 | ||||||||
Audio and Video Products – 0% | ||||||||||
1,900 | Harman International Industries, Inc.* | 87,970 | ||||||||
Automotive – Cars and Light Trucks – 0.4% | ||||||||||
66,100 | Ford Motor Co.* | 1,109,819 | ||||||||
Automotive – Medium and Heavy Duty Trucks – 0.2% | ||||||||||
8,100 | PACCAR, Inc. | 465,102 | ||||||||
Beverages – Non-Alcoholic – 0.8% | ||||||||||
4,700 | Coca-Cola Co. | 309,119 | ||||||||
20,400 | Coca-Cola Enterprises, Inc. | 510,612 | ||||||||
43,600 | Dr. Pepper Snapple Group, Inc. | 1,532,976 | ||||||||
2,352,707 | ||||||||||
Beverages – Wine and Spirits – 0.2% | ||||||||||
8,600 | Brown-Forman Corp. – Class B | 598,732 | ||||||||
Brewery – 0% | ||||||||||
2,500 | Molson Coors Brewing Co. – Class B | 125,475 | ||||||||
Broadcast Services and Programming – 0.4% | ||||||||||
14,200 | Discovery Holding Co. – Class A* | 592,140 | ||||||||
13,100 | Scripps Networks Interactive, Inc. – Class A | 677,925 | ||||||||
1,270,065 | ||||||||||
Building – Residential and Commercial – 0.1% | ||||||||||
8,900 | Lennar Corp. – Class A | 166,875 | ||||||||
Cable Television – 2.4% | ||||||||||
3,300 | Cablevision Systems New York Group – Class A | 111,672 | ||||||||
7,300 | Comcast Corp. – Class A | 160,381 | ||||||||
139,400 | DIRECTV – Class A* | 5,566,242 | ||||||||
19,700 | Time Warner Cable, Inc. – Class A | 1,300,791 | ||||||||
7,139,086 | ||||||||||
Casino Hotels – 0.1% | ||||||||||
1,500 | Wynn Resorts, Ltd. | 155,760 | ||||||||
Cellular Telecommunications – 0% | ||||||||||
10,500 | MetroPCS Communications, Inc.* | 132,615 | ||||||||
Chemicals – Diversified – 0.8% | ||||||||||
31,000 | E.I. du Pont de Nemours & Co. | 1,546,280 | ||||||||
10,600 | PPG Industries, Inc. | 891,142 | ||||||||
2,437,422 | ||||||||||
Chemicals – Specialty – 0.8% | ||||||||||
5,700 | Eastman Chemical Co. | 479,256 | ||||||||
13,700 | Ecolab, Inc. | 690,754 | ||||||||
13,900 | International Flavors & Fragrances, Inc. | 772,701 | ||||||||
5,700 | Sigma-Aldrich Corp. | 379,392 | ||||||||
2,322,103 | ||||||||||
Coal – 0% | ||||||||||
1,100 | Peabody Energy Corp. | 70,378 | ||||||||
Coatings and Paint Products – 0.7% | ||||||||||
24,300 | Sherwin-Williams Co. | 2,035,125 | ||||||||
Commercial Banks – 1.8% | ||||||||||
7,400 | BB&T Corp. | 194,546 | ||||||||
159 | First Horizon National Corp.* | 1,873 | ||||||||
41,200 | M&T Bank Corp. | 3,586,460 | ||||||||
21,600 | Marshall & Ilsley Corp. | 149,472 | ||||||||
127,000 | Regions Financial Corp. | 889,000 | ||||||||
20,600 | Zions Bancorp. | 499,138 | ||||||||
5,320,489 | ||||||||||
Commercial Services – Finance – 0.4% | ||||||||||
10,500 | Equifax, Inc. | 373,800 | ||||||||
19,100 | H&R Block, Inc. | 227,481 | ||||||||
1,200 | MasterCard, Inc. – Class A | 268,932 | ||||||||
9,800 | Moody’s Corp. | 260,092 | ||||||||
1,800 | Visa, Inc. – Class A | 126,684 | ||||||||
1,256,989 | ||||||||||
Computer Aided Design – 0% | ||||||||||
3,200 | Autodesk, Inc.* | 122,240 | ||||||||
Computer Services – 3.9% | ||||||||||
105,900 | Cognizant Technology Solutions Corp.* | 7,761,411 | ||||||||
27,000 | International Business Machines Corp. | 3,962,520 | ||||||||
11,723,931 | ||||||||||
Computers – 4.9% | ||||||||||
45,800 | Apple, Inc.* | 14,773,248 | ||||||||
Computers – Memory Devices – 1.3% | ||||||||||
2,900 | EMC Corp.* | 66,410 | ||||||||
69,500 | NetApp, Inc.* | 3,819,720 | ||||||||
3,886,130 | ||||||||||
Computers – Peripheral Equipment – 0.1% | ||||||||||
12,100 | Lexmark International, Inc. – Class A* | 421,322 |
See Notes to Schedules of Investments and Financial Statements.
8 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Consumer Products – Miscellaneous – 0.4% | ||||||||||
3,900 | Clorox Co. | $ | 246,792 | |||||||
3,500 | Fortune Brands, Inc. | 210,875 | ||||||||
9,900 | Kimberly-Clark Corp. | 624,096 | ||||||||
1,081,763 | ||||||||||
Containers – Metal and Glass – 0.3% | ||||||||||
14,400 | Ball Corp. | 979,920 | ||||||||
Cosmetics and Toiletries – 2.7% | ||||||||||
16,400 | Avon Products, Inc. | 476,584 | ||||||||
3,000 | Colgate-Palmolive Co. | 241,110 | ||||||||
90,500 | Estee Lauder Cos., Inc. – Class A | 7,303,350 | ||||||||
8,021,044 | ||||||||||
Data Processing and Management – 0.1% | ||||||||||
13,700 | Fidelity National Information Services, Inc. | 375,243 | ||||||||
Distribution/Wholesale – 1.2% | ||||||||||
47,800 | Fastenal Co. | 2,863,698 | ||||||||
4,000 | Genuine Parts Co. | 205,360 | ||||||||
3,600 | W.W. Grainger, Inc. | 497,196 | ||||||||
3,566,254 | ||||||||||
Diversified Banking Institutions – 0.9% | ||||||||||
16,606 | Bank of America Corp. | 221,524 | ||||||||
150,200 | Citigroup, Inc.* | 710,446 | ||||||||
800 | Goldman Sachs Group, Inc. | 134,528 | ||||||||
28,926 | JPMorgan Chase & Co. | 1,227,041 | ||||||||
16,200 | Morgan Stanley | 440,802 | ||||||||
2,734,341 | ||||||||||
Diversified Operations – 2.1% | ||||||||||
700 | 3M Co. | 60,410 | ||||||||
30,100 | Eaton Corp. | 3,055,451 | ||||||||
82,400 | General Electric Co. | 1,507,096 | ||||||||
8,500 | Ingersoll-Rand Co. – Class A | 400,265 | ||||||||
4,000 | Leucadia National Corp. | 116,720 | ||||||||
2,700 | Parker Hannifin Corp. | 233,010 | ||||||||
7,600 | Textron, Inc. | 179,664 | ||||||||
15,000 | Tyco International, Ltd. (U.S. Shares) | 621,600 | ||||||||
6,174,216 | ||||||||||
E-Commerce/Products – 1.6% | ||||||||||
26,900 | Amazon.com, Inc.* | 4,842,000 | ||||||||
E-Commerce/Services – 2.5% | ||||||||||
52,800 | eBay, Inc.* | 1,469,424 | ||||||||
600 | Netflix, Inc.* | 105,420 | ||||||||
14,600 | Priceline.com, Inc.* | 5,833,430 | ||||||||
7,408,274 | ||||||||||
Electric – Integrated – 5.1% | ||||||||||
15,400 | Ameren Corp. | 434,126 | ||||||||
8,700 | American Electric Power Co., Inc. | 313,026 | ||||||||
46,600 | CMS Energy Corp. | 866,760 | ||||||||
9,200 | Consolidated Edison, Inc. | 456,044 | ||||||||
32,100 | Dominion Resources, Inc. | 1,371,312 | ||||||||
56,700 | DTE Energy Co. | 2,569,644 | ||||||||
17,100 | Duke Energy Corp. | 304,551 | ||||||||
11,800 | FPL Group, Inc. | 613,482 | ||||||||
21,300 | Integrys Energy Group, Inc. | 1,033,263 | ||||||||
17,500 | Northeast Utilities | 557,900 | ||||||||
60,700 | Pepco Holdings, Inc. | 1,107,775 | ||||||||
16,000 | Pinnacle West Capital Corp. | 663,200 | ||||||||
24,300 | Progress Energy, Inc. | 1,056,564 | ||||||||
4,900 | Public Service Enterprise Group, Inc. | 155,869 | ||||||||
7,200 | SCANA Corp. | 292,320 | ||||||||
26,100 | Southern Co. | 997,803 | ||||||||
28,700 | TECO Energy, Inc. | 510,860 | ||||||||
31,300 | Wisconsin Energy Corp. | 1,842,318 | ||||||||
9,200 | Xcel Energy, Inc. | 216,660 | ||||||||
15,363,477 | ||||||||||
Electric Products – Miscellaneous – 0.4% | ||||||||||
21,600 | Emerson Electric Co. | 1,234,872 | ||||||||
Electronic Components – Semiconductors – 0.7% | ||||||||||
10,800 | Advanced Micro Devices, Inc.* | 88,344 | ||||||||
3,900 | Altera Corp. | 138,762 | ||||||||
8,900 | Microchip Technology, Inc. | 304,469 | ||||||||
47,100 | Texas Instruments, Inc. | 1,530,750 | ||||||||
2,062,325 | ||||||||||
Electronic Measuring Instruments – 1.1% | ||||||||||
68,800 | Agilent Technologies, Inc.* | 2,850,384 | ||||||||
15,400 | FLIR Systems, Inc.* | 458,150 | ||||||||
3,308,534 | ||||||||||
Engineering – Research and Development Services – 0.1% | ||||||||||
2,900 | Fluor Corp. | 192,154 | ||||||||
Engines – Internal Combustion – 0.3% | ||||||||||
8,800 | Cummins, Inc. | 968,088 | ||||||||
Enterprise Software/Services – 0.2% | ||||||||||
119,400 | Novell, Inc.* | 706,848 | ||||||||
Entertainment Software – 0% | ||||||||||
6,800 | Electronic Arts, Inc.* | 111,384 | ||||||||
Fiduciary Banks – 0.1% | ||||||||||
4,300 | State Street Corp. | 199,262 | ||||||||
Finance – Consumer Loans – 0% | ||||||||||
9,500 | SLM Corp.* | 119,605 | ||||||||
Finance – Credit Card – 0.1% | ||||||||||
1,200 | American Express Co. | 51,504 | ||||||||
9,100 | Discover Financial Services | 168,623 | ||||||||
220,127 | ||||||||||
Finance – Investment Bankers/Brokers – 0% | ||||||||||
4,400 | E*TRADE Financial Corp.* | 70,400 | ||||||||
Food – Confectionary – 1.0% | ||||||||||
29,000 | Hershey Co. | 1,367,350 | ||||||||
26,700 | J.M. Smucker Co. | 1,752,855 | ||||||||
3,120,205 | ||||||||||
Food – Meat Products – 0.6% | ||||||||||
4,800 | Hormel Foods Corp. | 246,048 | ||||||||
87,500 | Tyson Foods, Inc. – Class A | 1,506,750 | ||||||||
1,752,798 | ||||||||||
Food – Miscellaneous/Diversified – 2.2% | ||||||||||
600 | Campbell Soup Co. | 20,850 | ||||||||
69,200 | General Mills, Inc. | 2,462,828 | ||||||||
20,900 | Kellogg Co. | 1,067,572 | ||||||||
5,500 | Kraft Foods, Inc. – Class A | 173,305 | ||||||||
3,300 | McCormick & Co., Inc. | 153,549 | ||||||||
148,500 | Sara Lee Corp. | 2,600,235 | ||||||||
6,478,339 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 9
Table of Contents
INTECH Risk-Managed Core Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Food – Retail – 0% | ||||||||||
6,000 | Kroger Co. | $ | 134,160 | |||||||
Food – Wholesale/Distribution – 0.1% | ||||||||||
7,600 | Sysco Corp. | 223,440 | ||||||||
Forestry – 0% | ||||||||||
6,000 | Weyerhaeuser Co. | 113,580 | ||||||||
Gas – Distribution – 1.1% | ||||||||||
86,700 | CenterPoint Energy, Inc. | 1,362,924 | ||||||||
101,200 | NiSource, Inc. | 1,783,144 | ||||||||
2,500 | Sempra Energy | 131,200 | ||||||||
3,277,268 | ||||||||||
Hazardous Waste Disposal – 0.7% | ||||||||||
25,000 | Stericycle, Inc.* | 2,023,000 | ||||||||
Hotels and Motels – 0.5% | ||||||||||
19,000 | Marriott International, Inc. – Class A | 789,260 | ||||||||
6,200 | Starwood Hotels & Resorts Worldwide, Inc. | 376,836 | ||||||||
9,700 | Wyndham Worldwide Corp. | 290,612 | ||||||||
1,456,708 | ||||||||||
Independent Power Producer – 0% | ||||||||||
2,900 | NRG Energy, Inc.* | 56,666 | ||||||||
Industrial Automation and Robotics – 0.7% | ||||||||||
29,500 | Rockwell Automation, Inc. | 2,115,445 | ||||||||
Industrial Gases – 0.6% | ||||||||||
4,400 | Air Products & Chemicals, Inc. | 400,180 | ||||||||
4,500 | Airgas, Inc. | 281,070 | ||||||||
10,200 | Praxair, Inc. | 973,794 | ||||||||
1,655,044 | ||||||||||
Insurance Brokers – 0% | ||||||||||
2,400 | Marsh & McLennan Cos., Inc. | 65,616 | ||||||||
Internet Infrastructure Software – 0.5% | ||||||||||
26,100 | Akamai Technologies, Inc.* | 1,228,005 | ||||||||
1,000 | F5 Networks, Inc.* | 130,160 | ||||||||
1,358,165 | ||||||||||
Internet Security – 0.1% | ||||||||||
4,300 | McAfee, Inc.* | 199,133 | ||||||||
5,900 | VeriSign, Inc.* | 192,753 | ||||||||
391,886 | ||||||||||
Investment Management and Advisory Services – 1.4% | ||||||||||
22,600 | Ameriprise Financial, Inc. | 1,300,630 | ||||||||
22,600 | Franklin Resources, Inc. | 2,513,346 | ||||||||
2,900 | INVESCO, Ltd. | 69,774 | ||||||||
1,900 | Legg Mason, Inc. | 68,913 | ||||||||
1,400 | T. Rowe Price Group, Inc. | 90,356 | ||||||||
4,043,019 | ||||||||||
Life and Health Insurance – 0.3% | ||||||||||
5,000 | AFLAC, Inc. | 282,150 | ||||||||
4,900 | Lincoln National Corp. | 136,269 | ||||||||
5,900 | Principal Financial Group, Inc. | 192,104 | ||||||||
6,100 | Torchmark Corp. | 364,414 | ||||||||
974,937 | ||||||||||
Machinery – Construction and Mining – 0.8% | ||||||||||
26,300 | Caterpillar, Inc. | 2,463,258 | ||||||||
Machinery – Farm – 0.3% | ||||||||||
10,400 | Deere & Co. | 863,720 | ||||||||
Machinery – General Industrial – 0.1% | ||||||||||
4,100 | Roper Industries, Inc. | 313,363 | ||||||||
Machinery – Pumps – 0% | ||||||||||
600 | Flowserve Corp. | 71,532 | ||||||||
Medical – Biomedical and Genetic – 0.5% | ||||||||||
3,400 | Amgen, Inc.* | 186,660 | ||||||||
2,200 | Biogen Idec, Inc.* | 147,510 | ||||||||
2,300 | Celgene Corp.* | 136,022 | ||||||||
15,200 | Genzyme Corp.* | 1,082,240 | ||||||||
1,552,432 | ||||||||||
Medical – Drugs – 2.7% | ||||||||||
43,300 | Abbott Laboratories | 2,074,503 | ||||||||
10,800 | Bristol-Myers Squibb Co. | 285,984 | ||||||||
8,000 | Eli Lilly & Co. | 280,320 | ||||||||
153,186 | Merck & Co., Inc. | 5,520,823 | ||||||||
8,161,630 | ||||||||||
Medical – Generic Drugs – 0.4% | ||||||||||
52,500 | Mylan, Inc.* | 1,109,325 | ||||||||
Medical – HMO – 0.8% | ||||||||||
44,200 | Humana, Inc.* | 2,419,508 | ||||||||
1,000 | WellPoint, Inc.* | 56,860 | ||||||||
2,476,368 | ||||||||||
Medical – Wholesale Drug Distributors – 3.4% | ||||||||||
99,600 | AmerisourceBergen Corp. | 3,398,352 | ||||||||
102,300 | Cardinal Health, Inc. | 3,919,113 | ||||||||
43,100 | McKesson Corp. | 3,033,378 | ||||||||
10,350,843 | ||||||||||
Medical Instruments – 1.7% | ||||||||||
19,400 | Intuitive Surgical, Inc.* | 5,000,350 | ||||||||
Medical Products – 2.8% | ||||||||||
43,600 | Carefusion Corp.* | 1,120,520 | ||||||||
40,700 | Hospira, Inc.* | 2,266,583 | ||||||||
2,800 | Johnson & Johnson | 173,180 | ||||||||
43,400 | Stryker Corp. | 2,330,580 | ||||||||
24,300 | Varian Medical Systems, Inc.* | 1,683,504 | ||||||||
18,100 | Zimmer Holdings, Inc.* | 971,608 | ||||||||
8,545,975 | ||||||||||
Metal – Aluminum – 0% | ||||||||||
4,600 | Alcoa, Inc. | 70,794 | ||||||||
Metal – Copper – 0.1% | ||||||||||
2,500 | Freeport-McMoRan Copper & Gold, Inc. – Class B | 300,225 | ||||||||
Metal – Iron – 0.1% | ||||||||||
2,400 | Cliffs Natural Resources, Inc. | 187,224 | ||||||||
Metal Processors and Fabricators – 0.5% | ||||||||||
11,600 | Precision Castparts Corp. | 1,614,836 | ||||||||
Motorcycle and Motor Scooter Manufacturing – 0% | ||||||||||
2,200 | Harley-Davidson, Inc. | 76,274 | ||||||||
Multi-Line Insurance – 0.8% | ||||||||||
6,800 | ACE, Ltd. (U.S. Shares) | 423,300 | ||||||||
9,400 | American International Group, Inc.* | 541,628 | ||||||||
27,100 | Assurant, Inc. | 1,043,892 | ||||||||
3,500 | MetLife, Inc. | 155,540 | ||||||||
12,700 | XL Capital, Ltd. | 277,114 | ||||||||
2,441,474 |
See Notes to Schedules of Investments and Financial Statements.
10 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Multimedia – 0.5% | ||||||||||
8,100 | McGraw-Hill Cos., Inc. | $ | 294,921 | |||||||
10,400 | News Corp. – Class A | 151,424 | ||||||||
12,000 | Viacom, Inc. – Class B | 475,320 | ||||||||
12,200 | Walt Disney Co. | 457,622 | ||||||||
1,379,287 | ||||||||||
Networking Products – 0.1% | ||||||||||
4,300 | Juniper Networks, Inc.* | 158,756 | ||||||||
Non-Ferrous Metals – 0.1% | ||||||||||
13,200 | Titanium Metals Corp.* | 226,776 | ||||||||
Non-Hazardous Waste Disposal – 0.1% | ||||||||||
10,300 | Republic Services, Inc. | 307,558 | ||||||||
Oil – Field Services – 0.9% | ||||||||||
1,714 | Baker Hughes, Inc. | 97,989 | ||||||||
18,300 | Halliburton Co. | 747,189 | ||||||||
21,047 | Schlumberger, Ltd. (U.S. Shares) | 1,757,425 | ||||||||
2,602,603 | ||||||||||
Oil and Gas Drilling – 0.1% | ||||||||||
1,900 | Helmerich & Payne, Inc. | 92,112 | ||||||||
8,100 | Rowan Cos., Inc.* | 282,771 | ||||||||
374,883 | ||||||||||
Oil Companies – Exploration and Production – 1.1% | ||||||||||
3,800 | Anadarko Petroleum Corp. | 289,408 | ||||||||
14,200 | Denbury Resources, Inc.* | 271,078 | ||||||||
1,600 | Newfield Exploration Co.* | 115,376 | ||||||||
2,100 | Noble Energy, Inc. | 180,768 | ||||||||
28,100 | Pioneer Natural Resources Co. | 2,439,642 | ||||||||
3,100 | QEP Resources, Inc. | 112,561 | ||||||||
3,408,833 | ||||||||||
Oil Companies – Integrated – 0.5% | ||||||||||
2,030 | Chevron Corp. | 185,238 | ||||||||
7,200 | ConocoPhillips | 490,320 | ||||||||
1,400 | Exxon Mobil Corp. | 102,368 | ||||||||
1,500 | Hess Corp. | 114,810 | ||||||||
8,800 | Marathon Oil Corp. | 325,864 | ||||||||
5,100 | Murphy Oil Corp. | 380,205 | ||||||||
1,598,805 | ||||||||||
Oil Field Machinery and Equipment – 0.1% | ||||||||||
1,800 | FMC Technologies, Inc.* | 160,038 | ||||||||
2,100 | National Oilwell Varco, Inc. | 141,225 | ||||||||
301,263 | ||||||||||
Oil Refining and Marketing – 0.1% | ||||||||||
9,300 | Sunoco, Inc. | 374,883 | ||||||||
Pharmacy Services – 0.1% | ||||||||||
4,400 | Express Scripts, Inc. – Class A* | 237,820 | ||||||||
Pipelines – 0.6% | ||||||||||
14,400 | El Paso Corp. | 198,144 | ||||||||
26,000 | Oneok, Inc. | 1,442,220 | ||||||||
1,640,364 | ||||||||||
Property and Casualty Insurance – 0.9% | ||||||||||
6,600 | Chubb Corp. | 393,624 | ||||||||
71,300 | Progressive Corp. | 1,416,731 | ||||||||
16,600 | Travelers Cos., Inc. | 924,786 | ||||||||
2,735,141 | ||||||||||
Real Estate Management/Services – 0% | ||||||||||
5,800 | CB Richard Ellis Group, Inc. – Class A* | 118,784 | ||||||||
Reinsurance – 0.2% | ||||||||||
7,096 | Berkshire Hathaway, Inc. – Class B* | 568,461 | ||||||||
REIT – Apartments – 1.3% | ||||||||||
21,700 | Apartment Investment & Management Co. – Class A | 560,728 | ||||||||
6,700 | Avalonbay Communities, Inc. | 754,085 | ||||||||
49,300 | Equity Residential | 2,561,135 | ||||||||
3,875,948 | ||||||||||
REIT – Diversified – 0.2% | ||||||||||
6,200 | Vornado Realty Trust | 516,646 | ||||||||
REIT – Health Care – 0.3% | ||||||||||
7,800 | HCP, Inc. | 286,962 | ||||||||
5,600 | Heath Care REIT, Inc. | 266,784 | ||||||||
8,800 | Ventas, Inc. | 461,824 | ||||||||
1,015,570 | ||||||||||
REIT – Hotels – 0% | ||||||||||
3,300 | Host Hotels & Resorts, Inc. | 58,971 | ||||||||
REIT – Office Property – 0.2% | ||||||||||
6,400 | Boston Properties, Inc. | 551,040 | ||||||||
REIT – Regional Malls – 0.1% | ||||||||||
1,400 | Simon Property Group, Inc. | 139,286 | ||||||||
REIT – Storage – 0.3% | ||||||||||
9,100 | Public Storage | 922,922 | ||||||||
Retail – Apparel and Shoe – 0.8% | ||||||||||
3,500 | Abercrombie & Fitch Co. – Class A | 201,705 | ||||||||
70,800 | Limited Brands, Inc. | 2,175,684 | ||||||||
1,100 | Ross Stores, Inc. | 69,575 | ||||||||
2,446,964 | ||||||||||
Retail – Auto Parts – 0.8% | ||||||||||
5,100 | AutoZone, Inc.* | 1,390,209 | ||||||||
17,800 | O’Reilly Automotive, Inc.* | 1,075,476 | ||||||||
2,465,685 | ||||||||||
Retail – Automobile – 0.1% | ||||||||||
15,100 | AutoNation, Inc.* | 425,820 | ||||||||
Retail – Building Products – 0.2% | ||||||||||
20,100 | Home Depot, Inc. | 704,706 | ||||||||
Retail – Computer Equipment – 0% | ||||||||||
3,100 | GameStop Corp. – Class A* | 70,928 | ||||||||
Retail – Discount – 0.4% | ||||||||||
13,500 | Big Lots, Inc.* | 411,210 | ||||||||
15,700 | Family Dollar Stores, Inc. | 780,447 | ||||||||
800 | Wal-Mart Stores, Inc. | 43,144 | ||||||||
1,234,801 | ||||||||||
Retail – Jewelry – 0.1% | ||||||||||
7,000 | Tiffany & Co. | 435,890 | ||||||||
Retail – Major Department Stores – 1.2% | ||||||||||
11,100 | Sears Holdings Corp.* | 818,625 | ||||||||
61,300 | TJX Cos., Inc. | 2,721,107 | ||||||||
3,539,732 | ||||||||||
Retail – Restaurants – 3.0% | ||||||||||
18,800 | Darden Restaurants, Inc. | 873,072 | ||||||||
8,500 | McDonald’s Corp. | 652,460 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 11
Table of Contents
INTECH Risk-Managed Core Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Retail – Restaurants – (continued) | ||||||||||
168,200 | Starbucks Corp. | $ | 5,404,266 | |||||||
44,800 | Yum! Brands, Inc. | 2,197,440 | ||||||||
9,127,238 | ||||||||||
Savings/Loan/Thrifts – 0.1% | ||||||||||
17,600 | Hudson City Bancorp., Inc. | 224,224 | ||||||||
Schools – 0.3% | ||||||||||
1,800 | Apollo Group, Inc. – Class A* | 71,082 | ||||||||
16,600 | Devry, Inc. | 796,468 | ||||||||
867,550 | ||||||||||
Semiconductor Components/Integrated Circuits – 0.1% | ||||||||||
6,500 | Linear Technology Corp. | 224,835 | ||||||||
Steel – Producers – 0% | ||||||||||
1,500 | Nucor Corp. | 65,730 | ||||||||
Super-Regional Banks – 1.8% | ||||||||||
6,000 | Capital One Financial Corp. | 255,360 | ||||||||
29,600 | Comerica, Inc. | 1,250,304 | ||||||||
57,800 | Fifth Third Bancorp. | 848,504 | ||||||||
123,400 | Huntington Bancshares, Inc. | 847,758 | ||||||||
16,300 | Keycorp | 144,255 | ||||||||
5,500 | PNC Financial Services Group, Inc. | 333,960 | ||||||||
6,900 | SunTrust Banks, Inc. | 203,619 | ||||||||
12,600 | U.S. Bancorp. | 339,822 | ||||||||
33,380 | Wells Fargo & Co. | 1,034,446 | ||||||||
5,258,028 | ||||||||||
Telecommunication Equipment – 0.7% | ||||||||||
38,000 | Harris Corp. | 1,721,400 | ||||||||
47,100 | Tellabs, Inc. | 319,338 | ||||||||
2,040,738 | ||||||||||
Telecommunication Equipment – Fiber Optics – 0.1% | ||||||||||
7,500 | Corning, Inc. | 144,900 | ||||||||
Telephone – Integrated – 1.6% | ||||||||||
12,658 | AT&T, Inc. | 371,892 | ||||||||
12,100 | CenturyLink, Inc. | 558,657 | ||||||||
365,900 | Qwest Communications International, Inc. | 2,784,499 | ||||||||
2,900 | Verizon Communications, Inc. | 103,762 | ||||||||
69,400 | Windstream Corp. | 967,436 | ||||||||
4,786,246 | ||||||||||
Tobacco – 1.8% | ||||||||||
54,600 | Altria Group, Inc. | 1,344,252 | ||||||||
23,800 | Philip Morris International, Inc. | 1,393,014 | ||||||||
79,800 | Reynolds American, Inc. | 2,603,076 | ||||||||
5,340,342 | ||||||||||
Tools – Hand Held – 2.5% | ||||||||||
113,727 | Stanley Works | 7,604,924 | ||||||||
Toys – 0.8% | ||||||||||
52,000 | Hasbro, Inc. | 2,453,360 | ||||||||
Transportation – Railroad – 0.1% | ||||||||||
3,000 | Union Pacific Corp. | 277,980 | ||||||||
Transportation – Services – 1.2% | ||||||||||
9,600 | C.H. Robinson Worldwide, Inc. | 769,824 | ||||||||
12,100 | Expeditors International of Washington, Inc. | 660,660 | ||||||||
21,000 | FedEx Corp. | 1,953,210 | ||||||||
4,600 | United Parcel Service, Inc. – Class B | 333,868 | ||||||||
3,717,562 | ||||||||||
Vitamins and Nutrition Products – 0.7% | ||||||||||
35,300 | Mead Johnson Nutrition Co. – Class A | 2,197,425 | ||||||||
Web Portals/Internet Service Providers – 2.0% | ||||||||||
10,200 | Google, Inc. – Class A* | 6,058,494 | ||||||||
Wireless Equipment – 1.2% | ||||||||||
53,600 | American Tower Corp. – Class A* | 2,767,904 | ||||||||
85,100 | Motorola, Inc.* | 771,857 | ||||||||
2,100 | QUALCOMM, Inc. | 103,929 | ||||||||
3,643,690 | ||||||||||
Total Common Stock (cost $247,906,484) | 299,679,759 | |||||||||
Money Market – 0.4% | ||||||||||
1,179,000 | Janus Cash Liquidity Fund LLC, 0% (cost $1,179,000) | 1,179,000 | ||||||||
Total Investments (total cost $249,085,484) – 100.1% | 300,858,759 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.1)% | (255,982) | |||||||||
Net Assets – 100% | $ | 300,602,777 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Bermuda | $ | 69,774 | 0.0% | |||||
Ireland | 677,379 | 0.2% | ||||||
Netherlands Antilles | 1,757,425 | 0.6% | ||||||
Switzerland | 1,044,900 | 0.4% | ||||||
United States†† | 297,309,281 | 98.8% | ||||||
Total | $ | 300,858,759 | 100.0% |
†† | Includes Cash Equivalents (98.4% excluding Cash Equivalents). |
See Notes to Schedules of Investments and Financial Statements.
12 | DECEMBER 31, 2010
Table of Contents
INTECH Risk-Managed Growth Fund (unaudited)
Fund Snapshot This fund uses a mathematically-based investment process that seeks to capitalize on the natural volatility of stock prices. The primary aim of this strategy is to outperform the benchmark index without increasing risk. | Managed by INTECH Investment Management LLC |
Performance Overview
For the six-month period ended December 31, 2010, INTECH Risk-Managed Growth Fund returned 24.00% for its Class S Shares. This compares to the 26.37% return posted by the Russell 1000 Growth Index, the Fund’s benchmark.
Investment Strategy in This Environment
While INTECH does not employ fundamental analysis in the management of the Fund, fundamentals can have a significant impact on the general direction of the market in which we participate. The Fund’s goal is to produce long-term returns in excess of its benchmark with an equal or lesser amount of risk.
INTECH’s mathematical investment process seeks to build a more efficient portfolio than its benchmark, the Russell 1000 Growth Index. With a focus on risk management, investment decisions are governed by a mathematical investment process. The process does not attempt to predict the direction of the market, nor does it have a particular view of any stock in the Fund.
Performance Review
As stock prices moved naturally throughout the period, we continued to implement our mathematical process in a disciplined manner in an effort to maintain a more efficient portfolio than the benchmark, without increasing relative risk. While other factors may influence performance over the short term, we believe that the consistent application of our process will help the Fund perform well over the long term.
In INTECH’s history, which spans more than 23 years, we have experienced periods of both underperformance and outperformance relative to the benchmark. From our perspective, the key is to keep periods of underperformance both short in duration and mild in scope. INTECH aims to achieve excess returns over the long term and we believe the Fund remains well positioned for long-term capital growth.
Investment Strategy and Outlook
INTECH’s mathematical, risk-managed investment process seeks to outperform the Russell 1000 Growth Index over the long term, while attempting to manage risk relative to the benchmark. We will continue implementing the process in a disciplined and deliberate manner in an effort to achieve our long-term performance goals. The Fund may underperform during shorter time periods, but has the goal of outperformance over the long term. Risk management remains essential to the investment process. We will continue to make marginal improvements to the mathematical process, seeking an efficient portfolio that offers better long-term results than the benchmark, regardless of the market’s direction.
Thank you for your investment in INTECH Risk-Managed Growth Fund.
Janus Risk-Managed Funds | 13
Table of Contents
INTECH Risk-Managed Growth Fund (unaudited)
INTECH Risk-Managed Growth Fund At A Glance
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
International Business Machines Corp. Computer Services | 2.4% | |||
Apple, Inc. Computers | 2.2% | |||
Exxon Mobil Corp. Oil Companies – Integrated | 1.8% | |||
Cognizant Technology Solutions Corp. Computer Services | 1.4% | |||
Edwards Lifesciences Corp. Medical Instruments | 1.4% | |||
9.2% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29p03.gif)
Emerging markets comprised 0.1% of total net assets.
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29t03.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29c03.gif)
14 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29m03.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
INTECH Risk-Managed Growth Fund – Class A Shares | |||||||||||||
NAV | 23.99% | 17.62% | 1.27% | 5.91% | 0.90% | 0.90% | |||||||
MOP | 16.88% | 10.82% | 0.08% | 5.32% | |||||||||
INTECH Risk-Managed Growth Fund – Class C Shares | |||||||||||||
NAV | 23.35% | 16.36% | 0.42% | 5.29% | 2.82% | 1.90% | |||||||
CDSC | 22.12% | 15.19% | 0.42% | 5.29% | |||||||||
INTECH Risk-Managed Growth Fund – Class I Shares | 24.15% | 17.95% | 1.54% | 5.91% | 0.62% | 0.62% | |||||||
INTECH Risk-Managed Growth Fund – Class S Shares | 24.00% | 17.50% | 1.06% | 5.91% | 1.12% | 1.12% | |||||||
INTECH Risk-Managed Growth Fund – Class T Shares | 24.06% | 17.77% | 1.06% | 5.91% | 0.85% | 0.85% | |||||||
Russell 1000® Growth Index | 26.37% | 16.71% | 3.75% | 6.77% | |||||||||
Lipper Quartile – Class S Shares | – | 3rd | 4th | 4th | |||||||||
Lipper Ranking – based on total returns for Multi-Cap Growth Funds | – | 265/433 | 253/298 | 218/249 | |||||||||
Visit janus.com/advisor/mutual-funds to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) or visit janus.com/advisor/mutual-funds for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
See important disclosures on the next page.
Janus Risk-Managed Funds | 15
Table of Contents
INTECH Risk-Managed Growth Fund (unaudited)
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
For Class I Shares, Class S Shares, and Class T Shares, a 2% redemption fee may be imposed on shares held for 90 days or less. Performance shown does not reflect this redemption fee and, if reflected, performance would have been lower.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding the distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The proprietary mathematical process used by INTECH Investment Management LLC (“INTECH”) may not achieve the desired results. The rebalancing techniques used by the Fund may result in a higher portfolio turnover rate, higher expenses and potentially higher net taxable gains or losses compared to a “buy and hold” or index fund strategy.
The Fund’s performance may be affected by risks that include those associated with investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Class A Shares of the Fund commenced operations on July 6, 2009, after the reorganization of Class A Shares of Janus Adviser INTECH Risk-Managed Growth Fund (the “JAD predecessor fund”) into Class A Shares of the Fund. Performance shown for Class A Shares reflects the performance of the JAD predecessor fund’s Class A Shares from September 30, 2004 to July 6, 2009 (prior to the reorganization), calculated using the fees and expenses of the JAD predecessor fund’s Class A Shares, net of any fee and expense limitations or waivers. Performance shown for certain periods prior to September 30, 2004 for Class A Shares reflects the historical performance of the JAD predecessor fund’s Class S Shares (formerly named Class I Shares), calculated using the fees and expenses of Class S Shares of the JAD predecessor fund, without the effect of any fee and expense limitations or waivers. If Class A Shares of the Fund had been available during any period prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class A Shares reflects the fees and expenses of Class A Shares, net of any fee and expense limitations or waivers.
Class C Shares of the Fund commenced operations on July 6, 2009, after the reorganization of Class C Shares of the JAD predecessor fund into Class C Shares of the Fund. Performance shown for Class C Shares reflects the performance of the JAD predecessor fund’s Class C Shares prior to July 6, 2009 (prior to the reorganization), calculated using the fees and expenses of the JAD predecessor fund’s Class C Shares, net of any fee and expense limitations or waivers. If Class C Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class C Shares reflects the fees and expenses of Class C Shares, net of any fee and expense limitations or waivers.
Class I Shares of the Fund commenced operations on July 6, 2009, after the reorganization of Class I Shares of the JAD predecessor fund into Class I Shares of the Fund. Performance shown for Class I Shares reflects the performance of the JAD predecessor fund’s Class I Shares from November 28, 2005 to July 6, 2009 (prior to the reorganization), calculated using the fees and expenses of the JAD predecessor fund’s Class I Shares, net of any fee and expense limitations or waivers. The performance shown for certain periods prior to November 28, 2005 reflects the historical performance of the JAD predecessor fund’s Class S Shares (formerly named Class I Shares), calculated using the fees and expenses of Class S Shares of the JAD predecessor fund, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
Class S Shares of the Fund commenced operations on July 6, 2009, after the reorganization of Class S Shares of the JAD predecessor fund into Class S Shares of the Fund. Performance shown for Class S Shares for periods prior to July 6, 2009 reflects the historical performance of the JAD predecessor fund’s Class S Shares prior to the reorganization, calculated using the fees and expenses of the JAD predecessor fund’s Class S Shares, net of any fee and expense limitations or waivers. If Class S Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class S Shares reflects the fees and expenses of Class S Shares, net of any fee and expense limitations or waivers.
16 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Class T Shares of the Fund commenced operations on July 6, 2009. Performance shown for Class T Shares for periods prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class S Shares prior to the reorganization, calculated using the fees and expenses of Class S Shares, without the effect of any fee and expense limitations or waivers. If Class T Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class T Shares reflects the fees and expenses of Class T Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class S Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The weighting of securities within the portfolio may differ significantly from the weightings within the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The predecessor Fund’s inception date – January 2, 2003 |
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,240.90 | $ | 5.20 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.57 | $ | 4.69 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,233.50 | $ | 10.75 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,015.58 | $ | 9.70 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,242.70 | $ | 3.50 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,022.08 | $ | 3.16 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,240.00 | $ | 6.32 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.56 | $ | 5.70 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,240.60 | $ | 4.63 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.07 | $ | 4.18 | ||||||||
† | Expenses are equal to the annualized expense ratio of 0.92% for Class A Shares, 1.91% for Class C Shares, 0.62% for Class I Shares, 1.12% for Class S Shares and 0.82% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Risk-Managed Funds | 17
Table of Contents
INTECH Risk-Managed Growth Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Common Stock – 99.6% | ||||||||||
Advertising Agencies – 0.3% | ||||||||||
65,500 | Interpublic Group of Cos., Inc.* | $ | 695,610 | |||||||
7,000 | Omnicom Group, Inc. | 320,600 | ||||||||
1,016,210 | ||||||||||
Aerospace and Defense – 1.0% | ||||||||||
7,300 | Boeing Co. | 476,398 | ||||||||
3,100 | Lockheed Martin Corp. | 216,721 | ||||||||
12,200 | Rockwell Collins, Inc. | 710,772 | ||||||||
7,900 | Spirit Aerosystems Holdings, Inc.* | 164,399 | ||||||||
24,500 | TransDigm Group, Inc.* | 1,764,245 | ||||||||
3,332,535 | ||||||||||
Aerospace and Defense – Equipment – 1.4% | ||||||||||
900 | Alliant Techsystems, Inc. | 66,987 | ||||||||
29,500 | B.F. Goodrich Co. | 2,598,065 | ||||||||
26,300 | United Technologies Corp. | 2,070,336 | ||||||||
4,735,388 | ||||||||||
Agricultural Chemicals – 0.9% | ||||||||||
11,200 | CF Industries Holdings, Inc. | 1,513,680 | ||||||||
4,200 | Monsanto Co. | 292,488 | ||||||||
16,500 | Mosaic Co. | 1,259,940 | ||||||||
3,066,108 | ||||||||||
Airlines – 0.4% | ||||||||||
3,200 | Copa Holdings S.A. | 188,288 | ||||||||
43,000 | Southwest Airlines Co. | 558,140 | ||||||||
27,505 | UAL Corp.* | 655,169 | ||||||||
1,401,597 | ||||||||||
Apparel Manufacturers – 0.1% | ||||||||||
2,000 | Polo Ralph Lauren Corp. | 221,840 | ||||||||
Applications Software – 2.5% | ||||||||||
23,400 | Citrix Systems, Inc.* | 1,600,794 | ||||||||
33,000 | Intuit, Inc.* | 1,626,900 | ||||||||
147,200 | Microsoft Corp. | 4,109,824 | ||||||||
5,200 | Nuance Communications, Inc.* | 94,536 | ||||||||
6,500 | Red Hat, Inc.* | 296,725 | ||||||||
5,500 | Salesforce.com, Inc.* | 726,000 | ||||||||
8,454,779 | ||||||||||
Athletic Footwear – 0.1% | ||||||||||
5,000 | NIKE, Inc. – Class B | 427,100 | ||||||||
Audio and Video Products – 0% | ||||||||||
1,800 | Harman International Industries, Inc.* | 83,340 | ||||||||
Automotive – Cars and Light Trucks – 0.6% | ||||||||||
128,300 | Ford Motor Co.* | 2,154,157 | ||||||||
Automotive – Medium and Heavy Duty Trucks – 0.4% | ||||||||||
7,600 | Navistar International* | 440,116 | ||||||||
14,400 | PACCAR, Inc. | 826,848 | ||||||||
1,266,964 | ||||||||||
Automotive – Truck Parts and Equipment – Original – 1.2% | ||||||||||
12,700 | Autoliv, Inc. | 1,002,538 | ||||||||
9,200 | BorgWarner, Inc.* | 665,712 | ||||||||
3,500 | Lear Corp.* | 345,485 | ||||||||
12,600 | TRW Automotive Holdings Corp.* | 664,020 | ||||||||
20,700 | WABCO Holdings, Inc.* | 1,261,251 | ||||||||
3,939,006 | ||||||||||
Beverages – Non-Alcoholic – 2.2% | ||||||||||
61,300 | Coca-Cola Co. | 4,031,701 | ||||||||
52,000 | Coca-Cola Enterprises, Inc. | 1,301,560 | ||||||||
4,500 | Dr. Pepper Snapple Group, Inc. | 158,220 | ||||||||
14,400 | Hansen Natural Corp.* | 752,832 | ||||||||
16,975 | PepsiCo, Inc. | 1,108,977 | ||||||||
7,353,290 | ||||||||||
Beverages – Wine and Spirits – 0.3% | ||||||||||
16,100 | Brown-Forman Corp. – Class B | 1,120,882 | ||||||||
Broadcast Services and Programming – 0.6% | ||||||||||
16,700 | Discovery Holding Co. – Class A* | 696,390 | ||||||||
27,400 | Scripps Networks Interactive, Inc. – Class A | 1,417,950 | ||||||||
2,114,340 | ||||||||||
Building – Heavy Construction – 0% | ||||||||||
4,400 | Chicago Bridge & Iron Co. N.V.* | 144,760 | ||||||||
Building Products – Air and Heating – 0.2% | ||||||||||
12,200 | Lennox International, Inc. | 576,938 | ||||||||
Cable Television – 0.6% | ||||||||||
48,800 | DIRECTV – Class A* | 1,948,584 | ||||||||
Casino Hotels – 0.5% | ||||||||||
22,700 | Las Vegas Sands Corp.* | 1,043,065 | ||||||||
7,600 | Wynn Resorts, Ltd. | 789,184 | ||||||||
1,832,249 | ||||||||||
Cellular Telecommunications – 0.2% | ||||||||||
38,600 | MetroPCS Communications, Inc.* | 487,518 | ||||||||
6,000 | N.I.I. Holdings, Inc.* | 267,960 | ||||||||
755,478 | ||||||||||
Chemicals – Diversified – 0.8% | ||||||||||
6,700 | Celanese Corp. – Class A | 275,839 | ||||||||
17,700 | E.I. du Pont de Nemours & Co. | 882,876 | ||||||||
7,200 | FMC Corp. | 575,208 | ||||||||
11,500 | PPG Industries, Inc. | 966,805 | ||||||||
2,700,728 | ||||||||||
Chemicals – Specialty – 1.9% | ||||||||||
2,400 | Albemarle Corp. | 133,872 | ||||||||
2,500 | Ashland, Inc. | 127,150 | ||||||||
3,400 | Eastman Chemical Co. | 285,872 | ||||||||
17,600 | Ecolab, Inc. | 887,392 | ||||||||
14,500 | International Flavors & Fragrances, Inc. | 806,055 | ||||||||
36,100 | Lubrizol Corp. | 3,858,368 | ||||||||
5,900 | Sigma-Aldrich Corp. | 392,704 | ||||||||
6,491,413 | ||||||||||
Coal – 0.2% | ||||||||||
1,700 | Alpha Natural Resources, Inc.* | 102,051 | ||||||||
15,600 | Arch Coal, Inc. | 546,936 | ||||||||
1,900 | Consol Energy, Inc. | 92,606 | ||||||||
600 | Walter Industries, Inc. | 76,704 | ||||||||
818,297 | ||||||||||
Coatings and Paint Products – 0.3% | ||||||||||
14,000 | RPM International, Inc. | 309,400 | ||||||||
5,100 | Sherwin-Williams Co. | 427,125 | ||||||||
9,800 | Valspar Corp. | 337,904 | ||||||||
1,074,429 | ||||||||||
Coffee – 0.2% | ||||||||||
19,900 | Green Mountain Coffee Roasters, Inc.* | 653,914 |
See Notes to Schedules of Investments and Financial Statements.
18 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Commercial Banks – 0.1% | ||||||||||
7,400 | Bank of Hawaii Corp. | $ | 349,354 | |||||||
Commercial Services – 0% | ||||||||||
900 | Alliance Data Systems Corp.* | 63,927 | ||||||||
Commercial Services – Finance – 0.9% | ||||||||||
19,400 | Automatic Data Processing, Inc. | 897,832 | ||||||||
4,400 | Global Payments, Inc. | 203,324 | ||||||||
1,300 | MasterCard, Inc. – Class A | 291,343 | ||||||||
8,300 | Moody’s Corp. | 220,282 | ||||||||
15,800 | SEI Investments Co. | 375,882 | ||||||||
12,100 | Visa, Inc. – Class A | 851,598 | ||||||||
11,800 | Western Union Co. | 219,126 | ||||||||
3,059,387 | ||||||||||
Computer Aided Design – 0.2% | ||||||||||
19,000 | Autodesk, Inc.* | 725,800 | ||||||||
Computer Services – 4.9% | ||||||||||
40,900 | Accenture, Ltd. – Class A (U.S. Shares) | 1,983,241 | ||||||||
65,800 | Cognizant Technology Solutions Corp.* | 4,822,482 | ||||||||
12,100 | DST Systems, Inc. | 536,635 | ||||||||
12,000 | IHS, Inc. – Class A* | 964,680 | ||||||||
54,300 | International Business Machines Corp. | 7,969,068 | ||||||||
16,276,106 | ||||||||||
Computers – 2.9% | ||||||||||
22,600 | Apple, Inc.* | 7,289,856 | ||||||||
38,300 | Dell, Inc.* | 518,965 | ||||||||
48,300 | Hewlett-Packard Co. | 2,033,430 | ||||||||
9,842,251 | ||||||||||
Computers – Integrated Systems – 0.7% | ||||||||||
5,900 | Diebold, Inc. | 189,095 | ||||||||
13,300 | Micros Systems, Inc.* | 583,338 | ||||||||
14,400 | NCR Corp.* | 221,328 | ||||||||
31,900 | Terdata Corp.* | 1,313,004 | ||||||||
2,306,765 | ||||||||||
Computers – Memory Devices – 1.3% | ||||||||||
57,900 | EMC Corp.* | 1,325,910 | ||||||||
50,800 | NetApp, Inc.* | 2,791,968 | ||||||||
4,400 | SanDisk Corp.* | 219,384 | ||||||||
4,337,262 | ||||||||||
Consulting Services – 0.1% | ||||||||||
900 | FTI Consulting, Inc.* | 33,552 | ||||||||
8,400 | Gartner, Inc.* | 278,880 | ||||||||
312,432 | ||||||||||
Consumer Products – Miscellaneous – 1.2% | ||||||||||
22,300 | Clorox Co. | 1,411,144 | ||||||||
5,800 | Fortune Brands, Inc. | 349,450 | ||||||||
24,300 | Kimberly-Clark Corp. | 1,531,872 | ||||||||
10,600 | Scotts Miracle-Gro Co. – Class A | 538,162 | ||||||||
1,800 | Tupperware Brands Corp. | 85,806 | ||||||||
3,916,434 | ||||||||||
Containers – Metal and Glass – 0.4% | ||||||||||
9,000 | Ball Corp. | 612,450 | ||||||||
19,000 | Crown Holdings, Inc.* | 634,220 | ||||||||
1,246,670 | ||||||||||
Cosmetics and Toiletries – 2.3% | ||||||||||
6,800 | Alberto-Culver Co. | 251,872 | ||||||||
17,900 | Avon Products, Inc. | 520,174 | ||||||||
33,900 | Colgate-Palmolive Co. | 2,724,543 | ||||||||
40,300 | Estee Lauder Cos., Inc. – Class A | 3,252,210 | ||||||||
13,534 | Procter & Gamble Co. | 870,642 | ||||||||
7,619,441 | ||||||||||
Cruise Lines – 0.1% | ||||||||||
4,400 | Carnival Corp. (U.S. Shares) | 202,884 | ||||||||
5,000 | Royal Caribbean Cruises, Ltd. (U.S. Shares)* | 235,000 | ||||||||
437,884 | ||||||||||
Data Processing and Management – 0.4% | ||||||||||
37,600 | Broadridge Financial Solutions, Inc. | 824,568 | ||||||||
3,100 | Dun & Bradstreet Corp. | 254,479 | ||||||||
4,700 | Fiserv, Inc.* | 275,232 | ||||||||
1,354,279 | ||||||||||
Decision Support Software – 0.1% | ||||||||||
11,800 | MSCI, Inc.* | 459,728 | ||||||||
Dental Supplies and Equipment – 0.2% | ||||||||||
25,300 | Patterson Cos., Inc. | 774,939 | ||||||||
Diagnostic Equipment – 0.1% | ||||||||||
5,100 | Gen-Probe, Inc.* | 297,585 | ||||||||
Diagnostic Kits – 0.1% | ||||||||||
4,800 | Inverness Medical Innovations, Inc.* | 175,680 | ||||||||
Dialysis Centers – 0.1% | ||||||||||
4,100 | DaVita, Inc.* | 284,909 | ||||||||
Disposable Medical Products – 0.1% | ||||||||||
5,300 | C.R. Bard, Inc. | 486,381 | ||||||||
Distribution/Wholesale – 1.6% | ||||||||||
10,400 | Fastenal Co. | 623,064 | ||||||||
5,500 | Fossil, Inc.* | 387,640 | ||||||||
17,300 | LKQ Corp.* | 393,056 | ||||||||
25,200 | W.W. Grainger, Inc. | 3,480,372 | ||||||||
6,600 | Wesco International, Inc.* | 348,480 | ||||||||
5,232,612 | ||||||||||
Diversified Banking Institutions – 0% | ||||||||||
2,700 | Morgan Stanley | 73,467 | ||||||||
Diversified Operations – 2.5% | ||||||||||
32,600 | 3M Co. | 2,813,380 | ||||||||
12,200 | Cooper Industries, Ltd. – Class A (U.S. Shares) | 711,138 | ||||||||
3,000 | Dover Corp. | 175,350 | ||||||||
3,600 | Eaton Corp. | 365,436 | ||||||||
122,000 | General Electric Co. | 2,231,380 | ||||||||
6,900 | Honeywell International, Inc. | 366,804 | ||||||||
14,800 | Illinois Tool Works, Inc. | 790,320 | ||||||||
9,100 | Leggett & Platt, Inc. | 207,116 | ||||||||
2,900 | Parker Hannifin Corp. | 250,270 | ||||||||
1,000 | SPX Corp. | 71,490 | ||||||||
8,900 | Tyco International, Ltd. (U.S. Shares) | 368,816 | ||||||||
8,351,500 | ||||||||||
E-Commerce/Products – 0.6% | ||||||||||
11,200 | Amazon.com, Inc.* | 2,016,000 | ||||||||
E-Commerce/Services – 1.7% | ||||||||||
23,500 | eBay, Inc.* | 654,005 | ||||||||
21,600 | Expedia, Inc. | 541,944 | ||||||||
11,200 | IAC/InterActiveCorp* | 321,440 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 19
Table of Contents
INTECH Risk-Managed Growth Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
E-Commerce/Services – (continued) | ||||||||||
1,800 | Netflix, Inc.* | $ | 316,260 | |||||||
9,500 | Priceline.com, Inc.* | 3,795,725 | ||||||||
5,629,374 | ||||||||||
Electric Products – Miscellaneous – 0.4% | ||||||||||
7,800 | AMETEK, Inc. | 306,150 | ||||||||
19,800 | Emerson Electric Co. | 1,131,966 | ||||||||
1,438,116 | ||||||||||
Electric – Transmission – 0.2% | ||||||||||
11,100 | ITC Holdings Corp. | 687,978 | ||||||||
Electronic Components – Miscellaneous – 0.1% | ||||||||||
6,500 | Gentex Corp. | 192,140 | ||||||||
Electronic Components – Semiconductors – 2.1% | ||||||||||
14,700 | Altera Corp. | 523,026 | ||||||||
19,100 | Avago Technologies, Ltd. | 543,777 | ||||||||
8,400 | Broadcom Corp. – Class A | 365,820 | ||||||||
17,700 | Cree, Inc.* | 1,166,253 | ||||||||
27,500 | Intel Corp. | 578,325 | ||||||||
16,100 | MEMC Electronic Materials, Inc.* | 181,286 | ||||||||
10,700 | Microchip Technology, Inc. | 366,047 | ||||||||
300 | National Semiconductor Corp. | 4,128 | ||||||||
7,700 | PMC-Sierra, Inc.* | 66,143 | ||||||||
14,300 | QLogic Corp.* | 243,386 | ||||||||
2,900 | Rambus, Inc.* | 59,392 | ||||||||
5,200 | Rovi Corp.* | 322,452 | ||||||||
4,300 | Silicon Laboratories, Inc.* | 197,886 | ||||||||
7,800 | Skyworks Solutions, Inc.* | 223,314 | ||||||||
53,300 | Texas Instruments, Inc. | 1,732,250 | ||||||||
15,400 | Xilinx, Inc. | 446,292 | ||||||||
7,019,777 | ||||||||||
Electronic Connectors – 0.1% | ||||||||||
4,600 | Amphenol Corp. – Class A | 242,788 | ||||||||
3,000 | Thomas & Betts Corp.* | 144,900 | ||||||||
387,688 | ||||||||||
Electronic Design Automation – 0.2% | ||||||||||
78,700 | Cadence Design Systems, Inc.* | 650,062 | ||||||||
4,900 | Synopsys, Inc.* | 131,859 | ||||||||
781,921 | ||||||||||
Electronic Forms – 0% | ||||||||||
2,900 | Adobe Systems, Inc.* | 89,262 | ||||||||
Electronic Measuring Instruments – 0.6% | ||||||||||
44,300 | Agilent Technologies, Inc.* | 1,835,349 | ||||||||
1,900 | FLIR Systems, Inc.* | 56,525 | ||||||||
5,100 | Trimble Navigation, Ltd.* | 203,643 | ||||||||
2,095,517 | ||||||||||
Energy – Alternate Sources – 0.2% | ||||||||||
4,600 | First Solar, Inc.* | 598,644 | ||||||||
Engineering – Research and Development Services – 0.1% | ||||||||||
2,800 | Fluor Corp. | 185,528 | ||||||||
3,200 | KBR, Inc. | 97,504 | ||||||||
4,100 | McDermott International, Inc. (U.S. Shares)* | 84,829 | ||||||||
367,861 | ||||||||||
Engines – Internal Combustion – 0.5% | ||||||||||
15,700 | Cummins, Inc. | 1,727,157 | ||||||||
Enterprise Software/Services – 1.4% | ||||||||||
31,600 | BMC Software, Inc.* | 1,489,624 | ||||||||
10,200 | CA, Inc. | 249,288 | ||||||||
11,300 | Informatica Corp.* | 497,539 | ||||||||
81,544 | Oracle Corp. | 2,552,327 | ||||||||
4,788,778 | ||||||||||
Entertainment Software – 0.1% | ||||||||||
28,100 | Activision Blizzard, Inc. | 349,564 | ||||||||
5,800 | Electronic Arts, Inc.* | 95,004 | ||||||||
444,568 | ||||||||||
Filtration and Separations Products – 0% | ||||||||||
3,100 | Pall Corp. | 153,698 | ||||||||
Finance – Credit Card – 0.6% | ||||||||||
47,500 | American Express Co. | 2,038,700 | ||||||||
Finance – Investment Bankers/Brokers – 0.2% | ||||||||||
3,400 | Greenhill & Co., Ltd. | 277,712 | ||||||||
7,100 | Lazard, Ltd. – Class A | 280,379 | ||||||||
558,091 | ||||||||||
Finance – Other Services – 0.1% | ||||||||||
3,900 | NASDAQ Stock Market, Inc.* | 92,469 | ||||||||
11,700 | NYSE Euronext | 350,766 | ||||||||
443,235 | ||||||||||
Food – Baking – 0.1% | ||||||||||
7,300 | Flowers Foods, Inc. | 196,443 | ||||||||
Food – Confectionary – 0.2% | ||||||||||
14,200 | Hershey Co. | 669,530 | ||||||||
Food – Miscellaneous/Diversified – 3.5% | ||||||||||
38,200 | Campbell Soup Co. | 1,327,450 | ||||||||
55,300 | General Mills, Inc. | 1,968,127 | ||||||||
30,200 | H.J. Heinz Co. | 1,493,692 | ||||||||
48,200 | Kellogg Co. | 2,462,056 | ||||||||
45,200 | McCormick & Co., Inc. | 2,103,156 | ||||||||
128,600 | Sara Lee Corp. | 2,251,786 | ||||||||
11,606,267 | ||||||||||
Food – Retail – 0.2% | ||||||||||
16,500 | Kroger Co. | 368,940 | ||||||||
9,000 | Whole Foods Market, Inc. | 455,310 | ||||||||
824,250 | ||||||||||
Food – Wholesale/Distribution – 0.3% | ||||||||||
30,100 | Sysco Corp. | 884,940 | ||||||||
Forestry – 0.1% | ||||||||||
13,200 | Plum Creek Timber Co., Inc. | 494,340 | ||||||||
Garden Products – 0.1% | ||||||||||
7,200 | Toro Co. | 443,808 | ||||||||
Gold Mining – 0.1% | ||||||||||
3,000 | Newmont Mining Corp. | 184,290 | ||||||||
Hazardous Waste Disposal – 0% | ||||||||||
1,700 | Stericycle, Inc.* | 137,564 | ||||||||
Hospital Beds and Equipment – 0.2% | ||||||||||
15,000 | Hill-Rom Holdings, Inc. | 590,550 | ||||||||
Hotels and Motels – 0.6% | ||||||||||
31,300 | Marriott International, Inc. – Class A | 1,300,202 | ||||||||
10,000 | Starwood Hotels & Resorts Worldwide, Inc. | 607,800 | ||||||||
1,908,002 |
See Notes to Schedules of Investments and Financial Statements.
20 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Independent Power Producer – 0.1% | ||||||||||
14,600 | Calpine Corp.* | $ | 194,764 | |||||||
Industrial Audio and Video Products – 0.3% | ||||||||||
12,600 | Dolby Laboratories, Inc.* | 840,420 | ||||||||
Industrial Automation and Robotics – 0.2% | ||||||||||
9,000 | Rockwell Automation, Inc. | 645,390 | ||||||||
Industrial Gases – 0.8% | ||||||||||
12,900 | Air Products & Chemicals, Inc. | 1,173,255 | ||||||||
5,200 | Airgas, Inc. | 324,792 | ||||||||
11,600 | Praxair, Inc. | 1,107,452 | ||||||||
2,605,499 | ||||||||||
Instruments – Controls – 0.2% | ||||||||||
5,200 | Mettler-Toledo International, Inc.* | 786,292 | ||||||||
Instruments – Scientific – 0.2% | ||||||||||
7,000 | Waters Corp.* | 543,970 | ||||||||
Insurance Brokers – 0.8% | ||||||||||
9,600 | Arthur J. Gallagher & Co. | 279,168 | ||||||||
29,100 | Brown & Brown, Inc. | 696,654 | ||||||||
19,000 | Erie Indemnity Co. – Class A | 1,243,930 | ||||||||
10,800 | Marsh & McLennan Cos., Inc. | 295,272 | ||||||||
2,515,024 | ||||||||||
Internet Content – Information/News – 0.5% | ||||||||||
29,788 | WebMD Health Corp.* | 1,520,975 | ||||||||
Internet Infrastructure Software – 1.2% | ||||||||||
15,100 | Akamai Technologies, Inc.* | 710,455 | ||||||||
26,700 | F5 Networks, Inc.* | 3,475,272 | ||||||||
4,185,727 | ||||||||||
Internet Security – 0.2% | ||||||||||
7,000 | Symantec Corp.* | 117,180 | ||||||||
11,700 | VeriSign, Inc.* | 382,239 | ||||||||
499,419 | ||||||||||
Investment Management and Advisory Services – 1.0% | ||||||||||
2,000 | Affiliated Managers Group, Inc.* | 198,440 | ||||||||
8,000 | Ameriprise Financial, Inc. | 460,400 | ||||||||
600 | BlackRock, Inc. | 114,348 | ||||||||
2,600 | Eaton Vance Corp. | 78,598 | ||||||||
8,900 | Federated Investors, Inc. – Class B | 232,913 | ||||||||
15,900 | Franklin Resources, Inc. | 1,768,239 | ||||||||
13,000 | INVESCO, Ltd. | 312,780 | ||||||||
1,100 | T. Rowe Price Group, Inc. | 70,994 | ||||||||
1,400 | Waddell & Reed Financial, Inc. – Class A | 49,406 | ||||||||
3,286,118 | ||||||||||
Life and Health Insurance – 0.1% | ||||||||||
4,500 | AFLAC, Inc. | 253,935 | ||||||||
Machine Tools and Related Products – 0.1% | ||||||||||
4,400 | Kennametal, Inc. | 173,624 | ||||||||
900 | Lincoln Electric Holdings, Inc. | 58,743 | ||||||||
232,367 | ||||||||||
Machinery – Construction and Mining – 0.9% | ||||||||||
6,800 | Bucyrus International, Inc. | 607,920 | ||||||||
20,100 | Caterpillar, Inc. | 1,882,566 | ||||||||
7,000 | Joy Global, Inc. | 607,250 | ||||||||
3,097,736 | ||||||||||
Machinery – Electrical – 0.1% | ||||||||||
6,500 | Regal-Beloit Corp. | 433,940 | ||||||||
Machinery – Farm – 0.4% | ||||||||||
14,200 | Deere & Co. | 1,179,310 | ||||||||
Machinery – General Industrial – 0.4% | ||||||||||
7,000 | Babcock & Wilcox Co.* | 179,130 | ||||||||
2,800 | Gardner Denver, Inc. | 192,696 | ||||||||
5,900 | IDEX Corp. | 230,808 | ||||||||
8,200 | Roper Industries, Inc. | 626,726 | ||||||||
2,000 | Wabtec Corp. | 105,780 | ||||||||
1,335,140 | ||||||||||
Machinery – Print Trade – 0.2% | ||||||||||
16,500 | Zebra Technologies Corp.* | 626,835 | ||||||||
Machinery – Pumps – 0.1% | ||||||||||
2,100 | Flowserve Corp. | 250,362 | ||||||||
Medical – Biomedical and Genetic – 1.3% | ||||||||||
13,600 | Alexion Pharmaceuticals, Inc.* | 1,095,480 | ||||||||
5,500 | Celgene Corp.* | 325,270 | ||||||||
8,400 | Genzyme Corp.* | 598,080 | ||||||||
4,900 | Gilead Sciences, Inc.* | 177,576 | ||||||||
6,500 | Human Genome Sciences, Inc.* | 155,285 | ||||||||
23,900 | Life Technologies Corp.* | 1,326,450 | ||||||||
9,500 | United Therapeutics Corp.* | 600,590 | ||||||||
6,600 | Vertex Pharmaceuticals, Inc.* | 231,198 | ||||||||
4,509,929 | ||||||||||
Medical – Drugs – 1.0% | ||||||||||
39,100 | Abbott Laboratories | 1,873,281 | ||||||||
5,100 | Allergan, Inc. | 350,217 | ||||||||
27,600 | Eli Lilly & Co. | 967,104 | ||||||||
3,190,602 | ||||||||||
Medical – Generic Drugs – 1.1% | ||||||||||
48,600 | Mylan, Inc.* | 1,026,918 | ||||||||
42,300 | Perrigo Co. | 2,678,859 | ||||||||
3,705,777 | ||||||||||
Medical – Outpatient and Home Medical Care – 0.3% | ||||||||||
34,300 | Lincare Holdings, Inc. | 920,269 | ||||||||
Medical – Wholesale Drug Distributors – 1.0% | ||||||||||
83,100 | AmerisourceBergen Corp. | 2,835,372 | ||||||||
6,900 | McKesson Corp. | 485,622 | ||||||||
3,320,994 | ||||||||||
Medical Information Systems – 0.5% | ||||||||||
14,500 | Allscripts Healthcare Solutions, Inc.* | 279,415 | ||||||||
14,200 | Cerner Corp.* | 1,345,308 | ||||||||
1,624,723 | ||||||||||
Medical Instruments – 1.9% | ||||||||||
56,100 | Edwards Lifesciences Corp.* | 4,535,124 | ||||||||
5,000 | Intuitive Surgical, Inc.* | 1,288,750 | ||||||||
2,200 | Medtronic, Inc. | 81,598 | ||||||||
3,000 | St. Jude Medical, Inc.* | 128,250 | ||||||||
16,500 | Thoratec Corp.* | 467,280 | ||||||||
6,501,002 | ||||||||||
Medical Labs and Testing Services – 0.6% | ||||||||||
19,100 | Laboratory Corp. of America Holdings* | 1,679,272 | ||||||||
7,200 | Quest Diagnostics, Inc. | 388,584 | ||||||||
2,067,856 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 21
Table of Contents
INTECH Risk-Managed Growth Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Medical Products – 2.8% | ||||||||||
5,500 | Baxter International, Inc. | $ | 278,410 | |||||||
3,400 | Becton, Dickinson and Co. | 287,368 | ||||||||
3,900 | Cooper Cos., Inc. | 219,726 | ||||||||
2,200 | Covidien PLC (U.S. Shares) | 100,452 | ||||||||
9,700 | Henry Schein, Inc.* | 595,483 | ||||||||
33,600 | Hospira, Inc.* | 1,871,184 | ||||||||
47,700 | Johnson & Johnson | 2,950,245 | ||||||||
20,900 | Stryker Corp. | 1,122,330 | ||||||||
2,400 | Teleflex, Inc. | 129,144 | ||||||||
27,400 | Varian Medical Systems, Inc.* | 1,898,272 | ||||||||
9,452,614 | ||||||||||
Metal – Copper – 0.5% | ||||||||||
6,300 | Freeport-McMoRan Copper & Gold, Inc. – Class B | 756,567 | ||||||||
17,500 | Southern Copper Corp. | 852,950 | ||||||||
1,609,517 | ||||||||||
Metal – Iron – 0.1% | ||||||||||
4,000 | Cliffs Natural Resources, Inc. | 312,040 | ||||||||
Metal Processors and Fabricators – 0.7% | ||||||||||
14,500 | Precision Castparts Corp. | 2,018,545 | ||||||||
9,600 | Timken Co. | 458,208 | ||||||||
2,476,753 | ||||||||||
Motion Pictures and Services – 0% | ||||||||||
5,200 | DreamWorks Animation SKG, Inc. – Class A* | 153,244 | ||||||||
Multi-Line Insurance – 0.3% | ||||||||||
7,500 | ACE, Ltd. (U.S. Shares) | 466,875 | ||||||||
11,200 | Genworth Financial, Inc. – Class A* | 147,168 | ||||||||
12,200 | MetLife, Inc. | 542,168 | ||||||||
1,156,211 | ||||||||||
Multimedia – 1.3% | ||||||||||
13,100 | FactSet Research Systems, Inc. | 1,228,256 | ||||||||
26,600 | McGraw-Hill Cos., Inc. | 968,506 | ||||||||
30,400 | News Corp. – Class A | 442,624 | ||||||||
7,700 | Thomson Reuters Corp. | 286,979 | ||||||||
29,700 | Time Warner, Inc. | 955,449 | ||||||||
15,800 | Viacom, Inc. – Class B | 625,838 | ||||||||
4,507,652 | ||||||||||
Networking Products – 0.4% | ||||||||||
18,400 | Cisco Systems, Inc.* | 372,232 | ||||||||
18,000 | Juniper Networks, Inc.* | 664,560 | ||||||||
6,500 | Polycom, Inc.* | 253,370 | ||||||||
1,290,162 | ||||||||||
Non-Ferrous Metals – 0.1% | ||||||||||
14,900 | Titanium Metals Corp.* | 255,982 | ||||||||
Non-Hazardous Waste Disposal – 0.3% | ||||||||||
1,900 | Republic Services, Inc. | 56,734 | ||||||||
29,850 | Waste Connections, Inc. | 821,771 | ||||||||
878,505 | ||||||||||
Office Automation and Equipment – 0.2% | ||||||||||
22,300 | Pitney Bowes, Inc. | 539,214 | ||||||||
Office Supplies and Forms – 0% | ||||||||||
2,500 | Avery Dennison Corp. | 105,850 | ||||||||
Oil – Field Services – 0.8% | ||||||||||
8,900 | Core Laboratories N.V. | 792,545 | ||||||||
27,200 | Halliburton Co. | 1,110,576 | ||||||||
2,500 | Schlumberger, Ltd. (U.S. Shares) | 208,750 | ||||||||
2,800 | Superior Energy Services, Inc.* | 97,972 | ||||||||
25,100 | Weatherford International, Ltd.* | 572,280 | ||||||||
2,782,123 | ||||||||||
Oil and Gas Drilling – 0.4% | ||||||||||
4,700 | Atwood Oceanics, Inc.* | 175,639 | ||||||||
22,400 | Pride International, Inc.* | 739,200 | ||||||||
12,100 | Rowan Cos., Inc.* | 422,411 | ||||||||
1,337,250 | ||||||||||
Oil Companies – Exploration and Production – 0.4% | ||||||||||
1,000 | Atlas Energy, Inc.* | 43,970 | ||||||||
2,700 | Cimarex Energy Co. | 239,031 | ||||||||
7,500 | EOG Resources, Inc. | 685,575 | ||||||||
1,200 | Forest Oil Corp.* | 45,564 | ||||||||
1,400 | Occidental Petroleum Corp. | 137,340 | ||||||||
1,000 | SM Energy Co. | 58,930 | ||||||||
2,200 | Whitting Petroleum Corp.* | 257,818 | ||||||||
1,468,228 | ||||||||||
Oil Companies – Integrated – 3.4% | ||||||||||
13,400 | Chevron Corp. | 1,222,750 | ||||||||
39,500 | ConocoPhillips | 2,689,950 | ||||||||
82,500 | Exxon Mobil Corp. | 6,032,400 | ||||||||
29,400 | Marathon Oil Corp. | 1,088,682 | ||||||||
3,300 | Murphy Oil Corp. | 246,015 | ||||||||
11,279,797 | ||||||||||
Oil Field Machinery and Equipment – 0.3% | ||||||||||
8,200 | Cameron International Corp.* | 415,986 | ||||||||
9,200 | Dresser-Rand Group, Inc.* | 391,828 | ||||||||
3,600 | FMC Technologies, Inc.* | 320,076 | ||||||||
1,127,890 | ||||||||||
Optical Supplies – 0.2% | ||||||||||
3,200 | Alcon, Inc. (U.S. Shares) | 522,880 | ||||||||
Paper and Related Products – 0.2% | ||||||||||
11,300 | Rayonier, Inc. | 593,476 | ||||||||
Pharmacy Services – 0.6% | ||||||||||
21,000 | Express Scripts, Inc. – Class A* | 1,135,050 | ||||||||
11,466 | Medco Health Solutions, Inc.* | 702,522 | ||||||||
4,400 | SXC Health Solutions Corp. (U.S. Shares)* | 188,584 | ||||||||
2,026,156 | ||||||||||
Pipelines – 0.1% | ||||||||||
5,300 | El Paso Corp. | 72,928 | ||||||||
7,000 | Williams Companies, Inc. | 173,040 | ||||||||
245,968 | ||||||||||
Power Converters and Power Supply Equipment – 0.1% | ||||||||||
4,000 | Hubbell, Inc. – Class A | 240,520 | ||||||||
6,100 | SunPower Corp. – Class A* | 78,263 | ||||||||
318,783 | ||||||||||
Printing – Commercial – 0% | ||||||||||
2,700 | VistaPrint N.V. (U.S. Shares)* | 124,200 | ||||||||
Private Corrections – 0.2% | ||||||||||
20,100 | Corrections Corp. of America* | 503,706 |
See Notes to Schedules of Investments and Financial Statements.
22 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Property and Casualty Insurance – 0.1% | ||||||||||
2,200 | Arch Capital Group, Ltd.* | $ | 193,710 | |||||||
3,600 | Travelers Cos., Inc. | 200,556 | ||||||||
394,266 | ||||||||||
Publishing – Books – 0.4% | ||||||||||
28,200 | John Wiley & Sons, Inc. – Class A | 1,275,768 | ||||||||
Quarrying – 0.2% | ||||||||||
9,300 | Compass Minerals International, Inc. | 830,211 | ||||||||
Real Estate Management/Services – 0.2% | ||||||||||
25,500 | CB Richard Ellis Group, Inc. – Class A* | 522,240 | ||||||||
3,400 | Jones Lang LaSalle, Inc. | 285,328 | ||||||||
807,568 | ||||||||||
Real Estate Operating/Development – 0% | ||||||||||
1,111 | Howard Hughes Corp.* | 60,461 | ||||||||
Reinsurance – 0.1% | ||||||||||
8,100 | Axis Capital Holdings, Ltd. | 290,628 | ||||||||
800 | Endurance Specialty Holdings, Ltd. | 36,856 | ||||||||
4,600 | Validus Holdings, Ltd. | 140,806 | ||||||||
468,290 | ||||||||||
REIT – Apartments – 0.3% | ||||||||||
6,700 | Apartment Investment & Management Co. – Class A | 173,128 | ||||||||
6,000 | Equity Residential | 311,700 | ||||||||
2,300 | Essex Property Trust, Inc. | 262,706 | ||||||||
6,700 | UDR, Inc. | 157,584 | ||||||||
905,118 | ||||||||||
REIT – Diversified – 0.2% | ||||||||||
5,100 | Digital Realty Trust, Inc. | 262,854 | ||||||||
4,300 | Vornado Realty Trust | 358,319 | ||||||||
621,173 | ||||||||||
REIT – Health Care – 0.1% | ||||||||||
3,800 | Ventas, Inc. | 199,424 | ||||||||
REIT – Regional Malls – 0.2% | ||||||||||
27,200 | General Growth Properties, Inc. | 421,056 | ||||||||
2,500 | Simon Property Group, Inc. | 248,725 | ||||||||
669,781 | ||||||||||
REIT – Shopping Centers – 0.1% | ||||||||||
2,900 | Federal Realty Investment Trust | 225,997 | ||||||||
REIT – Storage – 0.2% | ||||||||||
5,100 | Public Storage | 517,242 | ||||||||
REIT – Warehouse and Industrial – 0% | ||||||||||
10,500 | ProLogis | 151,620 | ||||||||
Rental Auto/Equipment – 0.1% | ||||||||||
14,600 | Aaron Rents, Inc. | 297,694 | ||||||||
Respiratory Products – 0.6% | ||||||||||
55,600 | ResMed, Inc.* | 1,925,984 | ||||||||
Retail – Apparel and Shoe – 0.8% | ||||||||||
2,200 | Abercrombie & Fitch Co. – Class A | 126,786 | ||||||||
5,000 | American Eagle Outfitters, Inc. | 73,150 | ||||||||
2,600 | Guess?, Inc. | 123,032 | ||||||||
32,600 | Limited Brands, Inc. | 1,001,798 | ||||||||
9,200 | Phillips-Van Heusen Corp. | 579,692 | ||||||||
12,300 | Ross Stores, Inc. | 777,975 | ||||||||
2,682,433 | ||||||||||
Retail – Auto Parts – 1.0% | ||||||||||
6,600 | Advance Auto Parts, Inc. | 436,590 | ||||||||
8,500 | AutoZone, Inc.* | 2,317,015 | ||||||||
11,900 | O’Reilly Automotive, Inc.* | 718,998 | ||||||||
3,472,603 | ||||||||||
Retail – Automobile – 0.3% | ||||||||||
19,500 | AutoNation, Inc.* | 549,900 | ||||||||
14,700 | Carmax, Inc.* | 468,636 | ||||||||
1,018,536 | ||||||||||
Retail – Building Products – 0% | ||||||||||
4,300 | Home Depot, Inc. | 150,758 | ||||||||
Retail – Consumer Electronics – 0.1% | ||||||||||
7,600 | Best Buy Co., Inc. | 260,604 | ||||||||
Retail – Discount – 1.2% | ||||||||||
1,900 | Costco Wholesale Corp. | 137,199 | ||||||||
1,600 | Dollar Tree, Inc.* | 89,728 | ||||||||
26,600 | Family Dollar Stores, Inc. | 1,322,286 | ||||||||
4,900 | Target Corp. | 294,637 | ||||||||
42,300 | Wal-Mart Stores, Inc. | 2,281,239 | ||||||||
4,125,089 | ||||||||||
Retail – Drug Store – 0.2% | ||||||||||
6,146 | CVS Caremark Corp. | 213,696 | ||||||||
14,900 | Walgreen Co. | 580,504 | ||||||||
794,200 | ||||||||||
Retail – Gardening Products – 0.2% | ||||||||||
13,000 | Tractor Supply Co. | 630,370 | ||||||||
Retail – Jewelry – 0.1% | ||||||||||
2,700 | Tiffany & Co. | 168,129 | ||||||||
Retail – Mail Order – 0.2% | ||||||||||
16,600 | Williams-Sonoma, Inc. | 592,454 | ||||||||
Retail – Major Department Stores – 0.5% | ||||||||||
37,600 | TJX Cos., Inc. | 1,669,064 | ||||||||
Retail – Office Supplies – 0% | ||||||||||
3,300 | Staples, Inc. | 75,141 | ||||||||
Retail – Pet Food and Supplies – 0.2% | ||||||||||
13,100 | PetSmart, Inc. | 521,642 | ||||||||
Retail – Regional Department Stores – 0.1% | ||||||||||
6,600 | Macy’s, Inc. | 166,980 | ||||||||
Retail – Restaurants – 2.0% | ||||||||||
7,100 | Brinker International, Inc. | 148,248 | ||||||||
900 | Chipotle Mexican Grill, Inc. – Class A* | 191,394 | ||||||||
10,700 | Darden Restaurants, Inc. | 496,908 | ||||||||
42,200 | McDonald’s Corp. | 3,239,272 | ||||||||
5,300 | Panera Bread Co. – Class A* | 536,413 | ||||||||
29,000 | Starbucks Corp. | 931,770 | ||||||||
21,200 | Yum! Brands, Inc. | 1,039,860 | ||||||||
6,583,865 | ||||||||||
Savings/Loan/Thrifts – 0.1% | ||||||||||
19,900 | Hudson City Bancorp., Inc. | 253,526 | ||||||||
Semiconductor Components/Integrated Circuits – 0.5% | ||||||||||
2,700 | Analog Devices, Inc. | 101,709 | ||||||||
31,700 | Atmel Corp.* | 390,544 | ||||||||
18,800 | Cypress Semiconductor Corp.* | 349,304 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 23
Table of Contents
INTECH Risk-Managed Growth Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Semiconductor Components/Integrated Circuits – (continued) | ||||||||||
19,500 | Linear Technology Corp. | $ | 674,505 | |||||||
6,600 | Marvell Technology Group, Ltd.* | 122,430 | ||||||||
1,638,492 | ||||||||||
Semiconductor Equipment – 0.2% | ||||||||||
31,600 | Applied Materials, Inc. | 443,980 | ||||||||
5,100 | KLA-Tencor Corp. | 197,064 | ||||||||
1,000 | Lam Research Corp.* | 51,780 | ||||||||
2,900 | Novellus Systems, Inc.* | 93,728 | ||||||||
2,700 | Teradyne, Inc.* | 37,908 | ||||||||
824,460 | ||||||||||
Soap and Cleaning Preparations – 0% | ||||||||||
1,900 | Church & Dwight Co., Inc. | 131,138 | ||||||||
Software Tools – 0.4% | ||||||||||
16,200 | VMware, Inc. – Class A* | 1,440,342 | ||||||||
Steel – Producers – 0% | ||||||||||
2,100 | Carpenter Technology Corp. | 84,504 | ||||||||
1,300 | Nucor Corp. | 56,966 | ||||||||
141,470 | ||||||||||
Telecommunication Equipment – 0.5% | ||||||||||
38,800 | Harris Corp. | 1,757,640 | ||||||||
Telecommunication Equipment – Fiber Optics – 0.1% | ||||||||||
5,500 | Corning, Inc. | 106,260 | ||||||||
17,900 | JDS Uniphase Corp.* | 259,192 | ||||||||
365,452 | ||||||||||
Telecommunication Services – 0.2% | ||||||||||
6,500 | Amdocs, Ltd. (U.S. Shares)* | 178,555 | ||||||||
15,500 | NeuStar, Inc. – Class A* | 403,775 | ||||||||
14,700 | tw telecom, inc.* | 250,635 | ||||||||
832,965 | ||||||||||
Telephone – Integrated – 0.6% | ||||||||||
68,800 | Frontier Communications Corp. | 669,424 | ||||||||
95,400 | Windstream Corp. | 1,329,876 | ||||||||
1,999,300 | ||||||||||
Television – 0.2% | ||||||||||
30,200 | CBS Corp. – Class B | 575,310 | ||||||||
Textile-Home Furnishings – 0% | ||||||||||
1,300 | Mohawk Industries, Inc.* | 73,788 | ||||||||
Therapeutics – 0.2% | ||||||||||
6,000 | BioMarin Pharmaceutical, Inc.* | 161,580 | ||||||||
19,500 | Warner Chilcott, Ltd. – Class A* | 439,920 | ||||||||
601,500 | ||||||||||
Tobacco – 1.6% | ||||||||||
115,600 | Altria Group, Inc. | 2,846,072 | ||||||||
42,400 | Philip Morris International, Inc. | 2,481,672 | ||||||||
5,327,744 | ||||||||||
Toys – 0.4% | ||||||||||
19,000 | Hasbro, Inc. | 896,420 | ||||||||
14,300 | Mattel, Inc. | 363,649 | ||||||||
1,260,069 | ||||||||||
Transactional Software – 0.2% | ||||||||||
10,900 | Solera Holdings, Inc. | 559,388 | ||||||||
Transportation – Railroad – 0.2% | ||||||||||
2,000 | Kansas City Southern* | 95,720 | ||||||||
6,200 | Union Pacific Corp. | 574,492 | ||||||||
670,212 | ||||||||||
Transportation – Services – 0.8% | ||||||||||
7,200 | C.H. Robinson Worldwide, Inc. | 577,368 | ||||||||
6,100 | Expeditors International of Washington, Inc. | 333,060 | ||||||||
7,100 | FedEx Corp. | 660,371 | ||||||||
1,900 | Ryder System, Inc. | 100,016 | ||||||||
3,900 | United Parcel Service, Inc. – Class B | 283,062 | ||||||||
28,900 | UTi Worldwide, Inc. (U.S. Shares) | 612,680 | ||||||||
2,566,557 | ||||||||||
Vitamins and Nutrition Products – 0.8% | ||||||||||
12,500 | Herbalife, Ltd. | 854,625 | ||||||||
27,900 | Mead Johnson Nutrition Co. – Class A | 1,736,775 | ||||||||
2,591,400 | ||||||||||
Water Treatment Systems – 0.1% | ||||||||||
5,400 | Nalco Holding Co. | 172,476 | ||||||||
Web Hosting/Design – 0.1% | ||||||||||
3,900 | Equinix, Inc.* | 316,914 | ||||||||
Web Portals/Internet Service Providers – 1.2% | ||||||||||
6,300 | Google, Inc. – Class A* | 3,742,011 | ||||||||
17,100 | Yahoo!, Inc.* | 284,373 | ||||||||
4,026,384 | ||||||||||
Wireless Equipment – 0.8% | ||||||||||
11,500 | American Tower Corp. – Class A* | 593,860 | ||||||||
16,000 | Crown Castle International Corp.* | 701,280 | ||||||||
11,400 | QUALCOMM, Inc. | 564,186 | ||||||||
17,200 | SBA Communications Corp. – Class A* | 704,168 | ||||||||
2,563,494 | ||||||||||
Total Investments (total cost $267,735,500) – 99.6% | 333,962,670 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.4% | 1,312,235 | |||||||||
Net Assets – 100% | $ | 335,274,905 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Bermuda | $ | 1,377,589 | 0.4% | |||||
Canada | 475,563 | 0.1% | ||||||
Cayman Islands | 854,625 | 0.2% | ||||||
Guernsey | 178,555 | 0.1% | ||||||
Ireland | 3,234,751 | 1.0% | ||||||
Liberia | 235,000 | 0.1% | ||||||
Netherlands | 1,061,505 | 0.3% | ||||||
Netherlands Antilles | 208,750 | 0.1% | ||||||
Panama | 476,001 | 0.1% | ||||||
Singapore | 543,777 | 0.2% | ||||||
Switzerland | 1,930,851 | 0.6% | ||||||
United States | 322,773,023 | 96.6% | ||||||
Virgin Islands (British) | 612,680 | 0.2% | ||||||
Total | $ | 333,962,670 | 100.0% |
See Notes to Schedules of Investments and Financial Statements.
24 | DECEMBER 31, 2010
Table of Contents
INTECH Risk-Managed International Fund (unaudited)
Fund Snapshot This fund uses a mathematically-based investment process that seeks to capitalize on the natural volatility of stock prices. The primary aim of this strategy is to outperform the benchmark index without increasing risk. | Managed by INTECH Investment Management LLC |
Performance Overview
For the six-month period ended December 31, 2010, INTECH Risk-Managed International Fund returned 26.92% for its Class I Shares. This compares to the 24.18% return posted by the MSCI EAFE Index, the Fund’s benchmark.
Investment Strategy in This Environment
While INTECH does not employ fundamental analysis in the management of the Fund, fundamentals can have a significant impact on the general direction of the market in which we participate. The Fund’s goal is to produce long-term returns in excess of its benchmark with an equal or lesser amount of risk.
INTECH’s mathematical investment process seeks to build a more efficient portfolio than its benchmark, the MSCI EAFE Index. With a focus on risk management, investment decisions are governed by a mathematical investment process. The process does not attempt to predict the direction of the market, nor does it have a particular view of any stock in the Fund.
Performance Review
As stock prices moved naturally throughout the period, we continued to implement our mathematical process in a disciplined manner in an effort to maintain a more efficient portfolio than the benchmark, without increasing relative risk. While other factors may influence performance over the short term, we believe that the consistent application of our process will help the Fund perform well over the long term.
In INTECH’s history, which spans more than 23 years, we have experienced periods of both underperformance and outperformance relative to the benchmark. From our perspective, the key is to keep periods of underperformance both short in duration and mild in scope. INTECH aims to achieve excess returns over the long term and we believe the Fund remains well positioned for long-term capital growth.
Investment Strategy and Outlook
INTECH’s mathematical, risk-managed investment process seeks to outperform the MSCI EAFE Index over the long term, while attempting to manage risk relative to the benchmark. We will continue implementing the process in a disciplined and deliberate manner in an effort to achieve our long-term performance goals. The Fund may underperform during shorter time periods, but has the goal of outperformance over the long term. Risk management remains essential to the investment process. We will continue to make marginal improvements to the mathematical process, seeking an efficient portfolio that offers better long-term results than the benchmark, regardless of the market’s direction.
Thank you for your investment in INTECH Risk-Managed International Fund.
Janus Risk-Managed Funds | 25
Table of Contents
INTECH Risk-Managed International Fund (unaudited)
INTECH Risk-Managed International Fund At A Glance
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
Nestle S.A. Food – Miscellaneous/Diversified | 2.0% | |||
Vodafone Group PLC Cellular Telecommunications | 1.6% | |||
Novo Nordisk A/S Medical – Drugs | 1.3% | |||
Compagnie Financiere Richemont S.A. Retail – Jewelry | 1.3% | |||
Bayerische Motoren Werke A.G. Automotive – Cars and Light Trucks | 1.2% | |||
7.4% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29p02.gif)
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29t02.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29c02.gif)
26 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29m02.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||
Fiscal | One | Since | Total Annual Fund | Net Annual Fund | |||||||
Year-to-Date | Year | Inception* | Operating Expenses | Operating Expenses | |||||||
INTECH Risk-Managed International Fund – Class A Shares | |||||||||||
NAV | 26.83% | 10.04% | –4.78% | 4.61% | 1.25% | ||||||
MOP | 19.46% | 3.75% | –6.30% | ||||||||
INTECH Risk-Managed International Fund – Class C Shares | |||||||||||
NAV | 26.62% | 9.88% | –5.09% | 5.33% | 2.00% | ||||||
CDSC | 25.38% | 8.80% | –5.09% | ||||||||
INTECH Risk-Managed International Fund – Class I Shares | 26.92% | 9.76% | –4.74% | 4.68% | 1.00% | ||||||
INTECH Risk-Managed International Fund – Class S Shares | 26.83% | 9.88% | –4.88% | 4.83% | 1.50% | ||||||
INTECH Risk-Managed International Fund – Class T Shares | 26.87% | 10.05% | –6.63% | 4.81% | 1.25% | ||||||
Morgan Stanley Capital International EAFE® Index | 24.18% | 7.75% | –5.21% | ||||||||
Lipper Quartile – Class I Shares | – | 3rd | 3rd | ||||||||
Lipper Ranking – based on total returns for International Funds | – | 714/1303 | 529/987 | ||||||||
Visit janus.com/advisor/mutual-funds to view current performance and characteristic information | |||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) or visit janus.com/advisor/mutual-funds for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
For Class I Shares, Class S Shares, and Class T Shares, a 2% redemption fee may be imposed on shares held for 90 days or less. Performance shown does not reflect this redemption fee and, if reflected, performance would have been lower.
See important disclosures on the next page.
Janus Risk-Managed Funds | 27
Table of Contents
INTECH Risk-Managed International Fund (unaudited)
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding the distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund’s fee waiver exceeded the investment advisory fee for the period presented so the Fund did not pay Janus Capital any investment advisory fees (net of waivers).
The proprietary mathematical process used by INTECH Investment Management LLC (“INTECH”) may not achieve the desired results. The rebalancing techniques used by the Fund may result in a higher portfolio turnover rate, higher expenses and potentially higher net taxable gains or losses compared to a “buy and hold” or index fund strategy.
The Fund’s performance may be affected by risks that include those associated with investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
Foreign securities have additional risks including exchange rate changes, political and economic upheaval, the relative lack of information, relatively low market liquidity and the potential lack of strict financial and accounting controls and standards. These risks are magnified in emerging markets. The prices of foreign securities held by the Fund, and therefore the Fund’s performance, may decline in response to such risks.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares commenced operations on July 6, 2009, after the reorganization of each class of Janus Adviser INTECH Risk-Managed International Fund (the “JAD predecessor fund”) into corresponding shares of the Fund. Performance shown for each class for periods prior to July 6, 2009, reflects the historical performance of each corresponding class of the JAD predecessor fund prior to the reorganization, calculated using the fees and expenses of the corresponding class of the JAD predecessor fund, respectively, net of any fee and expense limitations or waivers. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class T Shares of the Fund commenced operations on July 6, 2009. Performance shown for Class T Shares for periods prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class I Shares prior to the reorganization, calculated using the fees and expenses of Class T Shares, without the effect of any fee and expense limitations or waivers. If Class T Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class T Shares reflects the fees and expenses of Class T Shares, net of any fee and expense limitations or waivers.
Net dividends reinvested are the dividends that remain to be reinvested after foreign tax obligations have been met. Such obligations vary from country to country.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class I Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The weighting of securities within the portfolio may differ significantly from the weightings within the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The predecessor Fund’s inception date – May 2, 2007 |
28 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,271.60 | $ | 6.64 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.36 | $ | 5.90 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,269.50 | $ | 8.24 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.95 | $ | 7.32 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,270.90 | $ | 6.01 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.91 | $ | 5.35 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,271.60 | $ | 7.16 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.90 | $ | 6.36 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,270.00 | $ | 6.98 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.06 | $ | 6.21 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.16% for Class A Shares, 1.44% for Class C Shares, 1.05% for Class I Shares, 1.25% for Class S Shares and 1.22% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Risk-Managed Funds | 29
Table of Contents
INTECH Risk-Managed International Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Common Stock – 98.2% | ||||||||||
Advertising Services – 0.1% | ||||||||||
219 | Publicis Groupe | $ | 11,412 | |||||||
Aerospace and Defense – 0.8% | ||||||||||
303 | Finmeccanica S.P.A. | 3,443 | ||||||||
5,461 | Rolls-Royce Group PLC* | 53,037 | ||||||||
476,352 | Rolls-Royce Group PLC* | 742 | ||||||||
68 | Thales S.A. | 2,379 | ||||||||
59,601 | ||||||||||
Aerospace and Defense – Equipment – 0.5% | ||||||||||
1,555 | European Aeronautic Defence and Space Co. N.V.* | 36,234 | ||||||||
Agricultural Chemicals – 0% | ||||||||||
41 | Yara International A.S.A. | 2,373 | ||||||||
Airlines – 1.8% | ||||||||||
7,000 | All Nippon Airways Co., Ltd. | 26,130 | ||||||||
3,846 | British Airways PLC* | 16,338 | ||||||||
8,000 | Cathay Pacific Airways, Ltd. | 22,078 | ||||||||
1,651 | Deutsche Lufthansa A.G.* | 36,077 | ||||||||
273 | Groupe Air France* | 4,972 | ||||||||
3,398 | Iberia Lineas Aereas de Espana S.A.* | 14,505 | ||||||||
954 | Qantas Airways, Ltd.* | 2,478 | ||||||||
1,340 | Singapore Airlines, Ltd. | 15,980 | ||||||||
138,558 | ||||||||||
Total Airport Development – Maintenance – 0.2% | ||||||||||
237 | Fraport A.G. Frankfurt Airport Services Worldwide | 14,933 | ||||||||
Apparel Manufacturers – 2.1% | ||||||||||
2,970 | Burberry Group PLC | 52,040 | ||||||||
322 | Christian Dior | 45,991 | ||||||||
327 | Hermes International | 68,485 | ||||||||
166,516 | ||||||||||
Athletic Footwear – 0.2% | ||||||||||
211 | Adidas A.G. | 13,783 | ||||||||
500 | Yue Yuen Industrial Holdings, Ltd. | 1,798 | ||||||||
15,581 | ||||||||||
Audio and Video Products – 0.1% | ||||||||||
200 | Sony Corp. | 7,212 | ||||||||
Automotive – Cars and Light Trucks – 4.6% | ||||||||||
1,187 | Bayerische Motoren Werke A.G. | 93,333 | ||||||||
1,000 | Daihatsu Motor Co., Ltd. | 15,351 | ||||||||
908 | Daimler A.G.* | 61,544 | ||||||||
1,197 | Fiat S.P.A. | 24,677 | ||||||||
3,000 | Fuji Heavy Industries, Ltd. | 23,285 | ||||||||
8,000 | Isuzu Motors, Ltd. | 36,368 | ||||||||
500 | Nissan Motor Co., Ltd. | 4,762 | ||||||||
438 | PSA Peugeot Citroen* | 16,626 | ||||||||
87 | Renault S.A.* | 5,056 | ||||||||
37 | Volkswagen A.G. | 5,235 | ||||||||
4,131 | Volvo A.B. – Class B* | 72,836 | ||||||||
359,073 | ||||||||||
Automotive – Medium and Heavy Duty Trucks – 0.6% | ||||||||||
2,090 | Scania A.B. | 48,107 | ||||||||
Automotive – Truck Parts and Equipment – Original – 0.1% | ||||||||||
100 | Aisin Seiki Co., Ltd. | 3,539 | ||||||||
300 | NOK Corp. | 6,254 | ||||||||
9,793 | ||||||||||
Beverages – Non-Alcoholic – 0.4% | ||||||||||
2,531 | Coca-Cola Amatil, Ltd. | 28,108 | ||||||||
Beverages – Wine and Spirits – 0.1% | ||||||||||
254 | Diageo PLC | 4,692 | ||||||||
Bicycle Manufacturing – 0.3% | ||||||||||
400 | Shimano, Inc. | 20,352 | ||||||||
Brewery – 2.0% | ||||||||||
744 | Anheuser-Busch InBev N.V. | 42,546 | ||||||||
294 | Carlsberg A/S – Class B | 29,442 | ||||||||
436 | Foster’s Group, Ltd. | 2,532 | ||||||||
2,323 | SABMiller PLC | 81,715 | ||||||||
156,235 | ||||||||||
Building – Heavy Construction – 0.1% | ||||||||||
262 | Skanska A.B. – Class B | 5,196 | ||||||||
Building and Construction – Miscellaneous – 0.5% | ||||||||||
2,869 | Cintra Concesiones de Infraestructuras de Transporte S.A. | 28,500 | ||||||||
84 | Hochtief A.G. | 7,131 | ||||||||
18 | Koninklijke Boskalis Westminster N.V. | 859 | ||||||||
36,490 | ||||||||||
Building and Construction Products – Miscellaneous – 0.4% | ||||||||||
9 | Geberit A.G. | 2,082 | ||||||||
12 | Sika A.G. | 26,331 | ||||||||
28,413 | ||||||||||
Cable Television – 0.7% | ||||||||||
4,812 | British Sky Broadcasting Group PLC | 55,210 | ||||||||
38 | Kabel Deutschland Holding A.G.* | 1,771 | ||||||||
56,981 | ||||||||||
Casino Hotels – 0.1% | ||||||||||
5,000 | SJM Holdings, Ltd. | 7,938 | ||||||||
Cellular Telecommunications – 2.1% | ||||||||||
303 | Millicom International Cellular S.A. (SDR) | 28,966 | ||||||||
7 | NTT DoCoMo, Inc. | 12,229 | ||||||||
47,816 | Vodafone Group PLC | 123,587 | ||||||||
164,782 | ||||||||||
Chemicals – Diversified – 1.3% | ||||||||||
459 | BASF S.E. | 36,612 | ||||||||
151 | Bayer A.G. | 11,157 | ||||||||
20 | Koninklijke DSM N.V. | 1,138 | ||||||||
142 | Lanxess A.G. | 11,213 | ||||||||
3,000 | Mitsubishi Chemical Holdings Corp. | 20,365 | ||||||||
122 | Wacker Chemie A.G. | 21,288 | ||||||||
101,773 | ||||||||||
Chemicals – Specialty – 0.5% | ||||||||||
20 | Brenntag A.G.* | 2,039 | ||||||||
31 | Givaudan S.A. | 33,464 | ||||||||
35,503 | ||||||||||
Coal – 0% | ||||||||||
275 | MacArthur Coal, Ltd. | 3,600 | ||||||||
Commercial Banks – 6.1% | ||||||||||
2,017 | Australia and New Zealand Banking Group, Ltd. | 48,161 | ||||||||
831 | Banco de Sabadell S.A. | 3,275 | ||||||||
451 | Banco Santander Central Hispano S.A. | 4,777 | ||||||||
2,400 | Bank of East Asia, Ltd. | 10,051 | ||||||||
24,000 | BOC Hong Kong Holdings, Ltd. | 81,672 |
See Notes to Schedules of Investments and Financial Statements.
30 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Commercial Banks – (continued) | ||||||||||
1,812 | Commerzbank A.G.* | $ | 13,446 | |||||||
1,376 | Commonwealth Bank of Australia | 71,438 | ||||||||
116 | Danske Bank A/S | 2,974 | ||||||||
374 | Den Norske Bank A.S.A. | 5,253 | ||||||||
1,000 | Fukuoka Financial Group, Inc. | 4,349 | ||||||||
400 | Hang Seng Bank, Ltd. | 6,577 | ||||||||
24,367 | Lloyds Banking Group PLC* | 24,957 | ||||||||
1,000 | Nishin-Nippon City Bank, Ltd. | 3,043 | ||||||||
2,000 | Oversea-Chinese Banking Corp., Ltd. | 15,401 | ||||||||
655 | Pohjola Bank PLC | 7,850 | ||||||||
121 | Raiffeisen International Bank-Holding A.G. | 6,628 | ||||||||
1,500 | Sapporo Hokuyo Holdings, Inc. | 7,022 | ||||||||
2,048 | Skandinaviska Enskilda Banken A.B. | 17,095 | ||||||||
3,637 | Sparbanken Sverige A.B. – Class A* | 50,760 | ||||||||
1,577 | Standard Chartered PLC | 42,419 | ||||||||
1,149 | Suncorp-Metway, Ltd. | 10,116 | ||||||||
220 | Svenska Handelsbanken A.B. – Class A | 7,035 | ||||||||
1,000 | United Overseas Bank, Ltd. | 14,186 | ||||||||
70 | Westpac Banking Corp. | 1,590 | ||||||||
1,000 | Wing Hang Bank, Ltd. | 13,831 | ||||||||
473,906 | ||||||||||
Commercial Services – 1.1% | ||||||||||
2,034 | Aggreko PLC | 46,991 | ||||||||
78 | Edenred* | 1,846 | ||||||||
1,093 | Intertek Group PLC | 30,244 | ||||||||
5 | SGS S.A. | 8,393 | ||||||||
87,474 | ||||||||||
Commercial Services – Finance – 0.1% | ||||||||||
605 | Experian PLC | 7,526 | ||||||||
Computer Aided Design – 0.2% | ||||||||||
199 | Dassault Systemes S.A. | 15,001 | ||||||||
Computers – Peripheral Equipment – 0.1% | ||||||||||
315 | Logitech International S.A.* | 5,999 | ||||||||
Consulting Services – 0.4% | ||||||||||
355 | Bereau Veritas S.A. | 26,903 | ||||||||
518 | Serco Group PLC | 4,486 | ||||||||
31,389 | ||||||||||
Containers – Paper and Plastic – 0.4% | ||||||||||
4,371 | Amcor, Ltd. | 30,171 | ||||||||
Cosmetics and Toiletries – 0.5% | ||||||||||
87 | Beiersdorf A.G. | 4,827 | ||||||||
94 | L’Oreal S.A. | 10,434 | ||||||||
200 | Shiseido Co., Ltd. | 4,371 | ||||||||
500 | Unicharm Corp. | 19,897 | ||||||||
39,529 | ||||||||||
Cruise Lines – 0% | ||||||||||
17 | Carnival PLC | 790 | ||||||||
Dialysis Centers – 0.1% | ||||||||||
74 | Fresenius Medical Care A.G. & Co. KGaA | 4,274 | ||||||||
Distribution/Wholesale – 0.8% | ||||||||||
1,000 | Jardine Cycle & Carriage, Ltd. | 28,527 | ||||||||
6,000 | Li & Fung, Ltd. | 34,814 | ||||||||
63,341 | ||||||||||
Diversified Banking Institutions – 2.2% | ||||||||||
6,490 | HSBC Holdings PLC | 65,873 | ||||||||
583 | Julius Baer Group, Ltd. | 27,320 | ||||||||
792 | Natixis* | 3,704 | ||||||||
16,314 | Royal Bank of Scotland Group PLC* | 9,936 | ||||||||
4,089 | UBS A.G.* | 67,151 | ||||||||
173,984 | ||||||||||
Diversified Financial Services – 0.4% | ||||||||||
5,753 | Criteria Caixacorp S.A. | 30,608 | ||||||||
Diversified Minerals – 1.3% | ||||||||||
138 | Angiodynamics, Inc.* | 7,175 | ||||||||
246 | BHP Billiton PLC | 9,783 | ||||||||
1,243 | BHP Billiton, Ltd. | 57,517 | ||||||||
15,018 | Oxiana, Ltd. | 26,415 | ||||||||
100,890 | ||||||||||
Diversified Operations – 4.5% | ||||||||||
407 | Exor S.P.A. | 13,421 | ||||||||
281 | GEA Group A.G. | 8,121 | ||||||||
6,000 | Hutchison Whampoa, Ltd. | 61,755 | ||||||||
2,000 | Keppel Corp., Ltd. | 17,646 | ||||||||
431 | LVMH Moet Hennessy Louis Vuitton S.A. | 70,888 | ||||||||
383 | Siemens A.G. | 47,437 | ||||||||
2,057 | Smiths Group PLC | 39,923 | ||||||||
2,000 | Swire Pacific, Ltd. – Class A | 32,885 | ||||||||
543 | Wartsila Oyj – Class B | 41,426 | ||||||||
2,000 | Wharf Holdings, Ltd. | 15,387 | ||||||||
348,889 | ||||||||||
Diversified Operations – Commercial Services – 0% | ||||||||||
84 | Bunzl PLC | 942 | ||||||||
E-Commerce/Services – 0% | ||||||||||
100 | Dena, Co., Ltd. | 3,588 | ||||||||
Electric – Distribution – 0% | ||||||||||
89 | AGL Energy, Ltd. | 1,386 | ||||||||
Electric – Integrated – 1.2% | ||||||||||
2,000 | CLP Holdings, Ltd. | 16,237 | ||||||||
901 | Enel S.P.A. | 4,502 | ||||||||
100 | Hokuriku Electric Power Co. | 2,458 | ||||||||
500 | HongKong Electric Holdings | 3,152 | ||||||||
9,097 | International Power PLC | 62,057 | ||||||||
100 | Kansai Electric Power Co., Inc. | 2,469 | ||||||||
90,875 | ||||||||||
Electric Products – Miscellaneous – 1.2% | ||||||||||
12,000 | Hitachi, Ltd. | 64,014 | ||||||||
225 | Legrand S.A. | 9,161 | ||||||||
2,000 | Mitsubishi Electric Corp. | 20,993 | ||||||||
94,168 | ||||||||||
Electronic Components – Miscellaneous – 0.6% | ||||||||||
1,210 | Koninklijke Philips Electronics N.V. | 37,054 | ||||||||
400 | Omron Corp. | 10,600 | ||||||||
47,654 | ||||||||||
Electronic Components – Semiconductors – 1.0% | ||||||||||
9,822 | ARM Holdings PLC | 64,814 | ||||||||
1,564 | Infineon Technologies A.G. | 14,550 | ||||||||
79,364 | ||||||||||
Electronics – Military – 0.2% | ||||||||||
460 | Safran S.A. | 16,287 | ||||||||
Energy – Alternate Sources – 0% | ||||||||||
1,000 | Enel Green Power S.P.A.* | 2,112 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 31
Table of Contents
INTECH Risk-Managed International Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Engineering – Research and Development Services – 0.2% | ||||||||||
38 | ABB, Ltd.* | $ | 847 | |||||||
5,000 | Singapore Technologies Engineering, Ltd. | 13,328 | ||||||||
14,175 | ||||||||||
Filtration and Separations Products – 0.3% | ||||||||||
973 | Afla Laval A.B. | 20,514 | ||||||||
Finance – Credit Card – 0.1% | ||||||||||
300 | Credit Saison Co., Ltd. | 4,934 | ||||||||
Finance – Investment Bankers/Brokers – 0.4% | ||||||||||
3,710 | ICAP PLC | 30,942 | ||||||||
Finance – Leasing Companies – 0.3% | ||||||||||
200 | Orix Corp. | 19,687 | ||||||||
Finance – Other Services – 0.6% | ||||||||||
92 | ASX, Ltd. | 3,545 | ||||||||
1,100 | Hong Kong Exchanges & Clearing, Ltd. | 24,950 | ||||||||
439 | London Stock Exchange Group PLC | 5,735 | ||||||||
2,000 | Singapore Exchange, Ltd. | 13,126 | ||||||||
47,356 | ||||||||||
Food – Baking – 0.1% | ||||||||||
129 | ARYZTA A.G. | 5,955 | ||||||||
Food – Catering – 0.3% | ||||||||||
2,602 | Compass Group PLC | 23,567 | ||||||||
Food – Confectionary – 0.2% | ||||||||||
5 | Lindt & Spruengli A.G. | 15,117 | ||||||||
Food – Miscellaneous/Diversified – 2.4% | ||||||||||
600 | Associated British Foods PLC | 11,046 | ||||||||
400 | MEIJI Holdings Co., Ltd. | 18,086 | ||||||||
2,613 | Nestle S.A. | 153,056 | ||||||||
286 | Orkla A.S.A. | 2,781 | ||||||||
184,969 | ||||||||||
Food – Retail – 0.7% | ||||||||||
70 | Carrefour S.A. | 2,885 | ||||||||
2,963 | J Sainsbury PLC | 17,381 | ||||||||
1,439 | Jeronimo Martins SGPS S.A. | 21,918 | ||||||||
146 | Metro A.G. | 10,510 | ||||||||
95 | Tesco PLC | 630 | ||||||||
57 | Woolworths, Ltd. | 1,572 | ||||||||
54,896 | ||||||||||
Food – Wholesale/Distribution – 0.3% | ||||||||||
457 | Kesko, Ltd. | 21,328 | ||||||||
Gambling – Non-Hotel – 0.1% | ||||||||||
570 | TABCORP Holdings, Ltd. | 4,144 | ||||||||
Gas – Distribution – 0.8% | ||||||||||
8,401 | Centrica PLC | 43,427 | ||||||||
3,000 | Hong Kong & China Gas Co., Ltd. | 7,071 | ||||||||
2,000 | Tokyo Gas Co, Ltd. | 8,871 | ||||||||
59,369 | ||||||||||
Gold Mining – 0.2% | ||||||||||
255 | Newcrest Mining, Ltd. | 10,545 | ||||||||
96 | Randgold Resources, Ltd. | 7,894 | ||||||||
18,439 | ||||||||||
Hotels and Motels – 1.1% | ||||||||||
624 | Accor S.A. | 27,763 | ||||||||
2,000 | City Developments, Ltd. | 19,579 | ||||||||
1,028 | Intercontinental Hotels Group PLC | 19,920 | ||||||||
8,000 | Shangri-La Asia, Ltd. | 21,717 | ||||||||
88,979 | ||||||||||
Import/Export – 0.5% | ||||||||||
1,200 | Itochu Corp. | 12,152 | ||||||||
300 | Mitsui & Co., Ltd. | 4,956 | ||||||||
1,400 | Sumitomo Corp. | 19,818 | ||||||||
36,926 | ||||||||||
Industrial Automation and Robotics – 0.8% | ||||||||||
400 | Fanuc, Ltd. | 61,451 | ||||||||
Industrial Gases – 0.2% | ||||||||||
22 | Air Liquide S.A. | 2,782 | ||||||||
106 | Linde A.G. | 16,081 | ||||||||
18,863 | ||||||||||
Instruments – Scientific – 0.1% | ||||||||||
300 | Hamamatsu Photonics K.K. | 10,970 | ||||||||
Investment Companies – 0.8% | ||||||||||
1,000 | Cheung Kong Infrastructure Holdings, Ltd. | 4,580 | ||||||||
67 | Eurazeo | 4,967 | ||||||||
15 | Israel Corp., Ltd.* | 18,216 | ||||||||
1,032 | Kinnevik Investment A.B. | 21,037 | ||||||||
289 | Ratos A.B. | 10,707 | ||||||||
59,507 | ||||||||||
Investment Management and Advisory Services – 0.5% | ||||||||||
1,462 | GAM Holding, Ltd.* | 24,166 | ||||||||
1,657 | Man Group PLC | 7,646 | ||||||||
319 | Schroders PLC | 9,225 | ||||||||
41,037 | ||||||||||
Leisure & Recreation Products – 0.3% | ||||||||||
1,400 | Sega Sammy Holdings, Inc. | 26,648 | ||||||||
Life and Health Insurance – 1.7% | ||||||||||
5,700 | AIA Group, Ltd.* | 16,024 | ||||||||
5 | Dai-ichi Life Insurance Co., Ltd. | 8,125 | ||||||||
22,418 | Legal & General Group PLC | 33,812 | ||||||||
12,922 | Old Mutual PLC | 24,797 | ||||||||
1,336 | Prudential PLC | 13,912 | ||||||||
4 | Sony Financial Holdings, Inc. | 16,188 | ||||||||
5,228 | Standard Life PLC | 17,604 | ||||||||
130,462 | ||||||||||
Machine Tools and Related Products – 0.3% | ||||||||||
1,070 | Sandvik A.B. | 20,872 | ||||||||
Machinery – Construction and Mining – 1.4% | ||||||||||
1,423 | Atlas Copco A.B. – Class A | 35,930 | ||||||||
1,885 | Atlas Copco A.B. – Class B | 42,659 | ||||||||
900 | Komatsu, Ltd. | 27,243 | ||||||||
105,832 | ||||||||||
Machinery – Electrical – 0.7% | ||||||||||
149 | Schindler Holding A.G. | 17,838 | ||||||||
302 | Schindler Holding A.G. | 35,735 | ||||||||
53,573 | ||||||||||
Machinery – General Industrial – 2.2% | ||||||||||
1,263 | Hexagon A.B. | 27,098 | ||||||||
586 | Kone Oyj – Class B | 32,571 | ||||||||
521 | MAN A.G. | 61,947 |
See Notes to Schedules of Investments and Financial Statements.
32 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Machinery – General Industrial – (continued) | ||||||||||
761 | Metso Corp. | $ | 42,501 | |||||||
300 | Nabtesco Corp. | 6,401 | ||||||||
170,518 | ||||||||||
Machinery – Pumps – 0.2% | ||||||||||
665 | Weir Group PLC | 18,453 | ||||||||
Medical – Biomedical and Genetic – 0.5% | ||||||||||
293 | Novozymes A/S | 40,821 | ||||||||
Medical – Drugs – 5.0% | ||||||||||
165 | Actelion, Ltd.* | 9,038 | ||||||||
986 | AstraZeneca PLC | 44,913 | ||||||||
400 | Daiichi Sankyo Co., Ltd. | 8,757 | ||||||||
1,787 | GlaxoSmithKline PLC | 34,543 | ||||||||
100 | Hisamitsu Pharmaceutical Co., Inc. | 4,213 | ||||||||
100 | Miraca Holdings, Inc. | 4,029 | ||||||||
300 | Mitsubishi Tanabe Pharma Corp. | 5,067 | ||||||||
1,314 | Novartis A.G. | 77,249 | ||||||||
907 | Novo Nordisk A/S | 102,296 | ||||||||
3,417 | Shire PLC | 82,192 | ||||||||
400 | Takeda Pharmaceutical Co., Ltd. | 19,687 | ||||||||
391,984 | ||||||||||
Medical Products – 0.3% | ||||||||||
45 | Cochlear, Ltd. | 3,700 | ||||||||
32 | Coloplast A/S | 4,350 | ||||||||
181 | Fresenius S.E. | 15,175 | ||||||||
23,225 | ||||||||||
Metal – Aluminum – 0.4% | ||||||||||
11,319 | Alumina, Ltd. | 28,705 | ||||||||
Metal – Copper – 0.2% | ||||||||||
765 | Antofagasta PLC | 19,224 | ||||||||
Metal – Diversified – 0.3% | ||||||||||
231 | Rio Tinto PLC | 16,156 | ||||||||
125 | Rio Tinto, Ltd. | 10,925 | ||||||||
27,081 | ||||||||||
Metal – Iron – 0.1% | ||||||||||
1,211 | Fortescue Metals Group, Ltd.* | 8,099 | ||||||||
Metal Processors and Fabricators – 0.9% | ||||||||||
1,408 | Assa Abloy A.B. – Class B | 39,699 | ||||||||
17 | Johnson Matthey PLC | 540 | ||||||||
1,031 | SKF A.B. | 29,392 | ||||||||
69,631 | ||||||||||
Mining Services – 0.3% | ||||||||||
939 | Orica, Ltd. | 23,909 | ||||||||
Multi-Line Insurance – 0.1% | ||||||||||
191 | ING Groep N.V.* | 1,858 | ||||||||
31 | Zurich Financial Services A.G. | 8,033 | ||||||||
9,891 | ||||||||||
Multimedia – 1.6% | ||||||||||
245 | Lagardere S.C.A. | 10,092 | ||||||||
2,690 | Pearson PLC | 42,270 | ||||||||
812 | Vivendi | 21,915 | ||||||||
4,024 | WPP PLC | 49,525 | ||||||||
123,802 | ||||||||||
Non-Ferrous Metals – 0% | ||||||||||
1,000 | Mitsubishi Materials Corp. | 3,191 | ||||||||
Office Automation and Equipment – 0.5% | ||||||||||
700 | Canon, Inc. | 36,307 | ||||||||
Oil – Field Services – 1.2% | ||||||||||
1,777 | AMEC PLC | 31,857 | ||||||||
34 | Fugro N.V. | 2,794 | ||||||||
1,665 | Petrofac, Ltd. | 41,191 | ||||||||
416 | Saipem S.P.A. | 20,476 | ||||||||
96,318 | ||||||||||
Oil and Gas Drilling – 0.3% | ||||||||||
659 | Seadrill, Ltd. | 22,285 | ||||||||
Oil Companies – Exploration and Production – 0.5% | ||||||||||
6,008 | Cairn Energy PLC* | 39,337 | ||||||||
Oil Companies – Integrated – 1.4% | ||||||||||
126 | BG Group PLC | 2,546 | ||||||||
225 | Essar Energy PLC* | 2,034 | ||||||||
114 | Galp Energia SGPS S.A. – Class B | 2,184 | ||||||||
100 | Idemitsu Kosan Co., Ltd. | 10,620 | ||||||||
968 | Repsol YPF S.A. | 26,966 | ||||||||
1,491 | Royal Dutch Shell PLC – Class A | 49,705 | ||||||||
580 | Royal Dutch Shell PLC – Class B | 19,123 | ||||||||
113,178 | ||||||||||
Oil Refining and Marketing – 0.7% | ||||||||||
450 | Caltex Australia, Ltd. | 6,613 | ||||||||
1,000 | Cosmo Oil Co. | 3,277 | ||||||||
5,900 | JX Holdings, Inc. | 40,050 | ||||||||
800 | Showa Shell Sekiyu K.K. | 7,333 | ||||||||
57,273 | ||||||||||
Paper and Related Products – 1.5% | ||||||||||
135 | Holmen A.B. – Class B | 4,447 | ||||||||
4,370 | Stora Enso Oyj – Class R | 44,871 | ||||||||
3,978 | UPM-Kymmene Oyj | 70,264 | ||||||||
119,582 | ||||||||||
Power Converters and Power Supply Equipment – 0.5% | ||||||||||
287 | Schneider Electric S.A. | 42,947 | ||||||||
Precious Metals – 0.5% | ||||||||||
821 | Umicore | 42,693 | ||||||||
Property and Casualty Insurance – 0.4% | ||||||||||
1,442 | Admiral Group PLC | 34,056 | ||||||||
Public Thoroughfares – 0% | ||||||||||
422 | Transurban Group | 2,209 | ||||||||
Publishing – Newspapers – 0.3% | ||||||||||
8,000 | Singapore Press Holdings, Ltd. | 24,817 | ||||||||
Publishing – Periodicals – 0.1% | ||||||||||
44 | Axel Springer A.G. | 7,172 | ||||||||
Real Estate Management/Services – 0.6% | ||||||||||
600 | Aeon Mall Co., Ltd. | 16,115 | ||||||||
400 | Daito Trust Construction Co., Ltd. | 27,399 | ||||||||
43,514 | ||||||||||
Real Estate Operating/Development – 2.0% | ||||||||||
1,000 | Cheng Kong Holdings, Ltd. | 15,426 | ||||||||
6,000 | Fraser and Neave, Ltd. | 29,977 | ||||||||
1,000 | Global Logistic Properties, Ltd.* | 1,684 | ||||||||
6,000 | Hang Lung Group, Ltd. | 39,446 | ||||||||
4,000 | Hang Lung Properties, Ltd. | 18,707 | ||||||||
4,000 | Hysan Development Co., Ltd. | 18,835 | ||||||||
4,400 | Keppel Land, Ltd. | 16,462 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 33
Table of Contents
INTECH Risk-Managed International Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Real Estate Operating/Development – (continued) | ||||||||||
500 | Kerry Properties, Ltd. | $ | 2,605 | |||||||
2,000 | Tokyu Land Corp. | 10,053 | ||||||||
1,000 | Wheelock & Co., Ltd. | 4,046 | ||||||||
157,241 | ||||||||||
Recreational Vehicles – 0% | ||||||||||
200 | Yamaha Motor Co., Ltd.* | 3,260 | ||||||||
REIT – Diversified – 1.5% | ||||||||||
1,587 | British Land Co. PLC | 12,976 | ||||||||
161 | Corio N.V. | 10,328 | ||||||||
57 | Fonciere Des Regions | 5,514 | ||||||||
94 | Gecina S.A. | 10,337 | ||||||||
2,401 | Goodman Group | 1,596 | ||||||||
2,636 | Hammerson PLC | 17,144 | ||||||||
2,195 | Land Securities Group PLC | 23,063 | ||||||||
2,918 | Liberty International PLC | 18,996 | ||||||||
98 | Unibail-Rodamco* | 19,379 | ||||||||
119,333 | ||||||||||
REIT – Office Property – 0.4% | ||||||||||
110 | ICADE | 11,221 | ||||||||
2 | Japan Prime Realty Investment Corp. | 6,160 | ||||||||
1 | Japan Real Estate Investment Corp. | 10,373 | ||||||||
1 | Nomura Real Estate Office Fund, Inc. | 7,220 | ||||||||
34,974 | ||||||||||
REIT – Shopping Centers – 0.3% | ||||||||||
11 | Japan Retail Fund Investment Corp. | 21,100 | ||||||||
Resorts and Theme Parks – 0.4% | ||||||||||
300 | Oriental Land Co., Ltd. | 27,794 | ||||||||
Retail – Apparel and Shoe – 0.6% | ||||||||||
313 | Hennes & Mauritz A.B. – Class B | 10,432 | ||||||||
458 | Inditex S.A. | 34,286 | ||||||||
44,718 | ||||||||||
Retail – Automobile – 0.1% | ||||||||||
60 | USS Co., Ltd. | 4,908 | ||||||||
Retail – Convenience Stores – 0% | ||||||||||
100 | FamilyMart Co., Ltd. | 3,770 | ||||||||
Retail – Jewelry – 2.7% | ||||||||||
1,704 | Compagnie Financiere Richemont S.A. | 100,268 | ||||||||
195 | Swatch Group A.G. | 86,954 | ||||||||
255 | Swatch Group A.G. | 20,570 | ||||||||
207,792 | ||||||||||
Retail – Major Department Stores – 0.5% | ||||||||||
1,200 | Marui Group Co., Ltd. | 9,787 | ||||||||
179 | PPR | 28,460 | ||||||||
38,247 | ||||||||||
Retail – Miscellaneous/Diversified – 1.1% | ||||||||||
1,800 | Aeon Co., Ltd. | 22,531 | ||||||||
508 | Wesfarmers, Ltd. | 16,779 | ||||||||
1,335 | Wesfarmers, Ltd. | 43,685 | ||||||||
82,995 | ||||||||||
Retail – Restaurants – 0.3% | ||||||||||
300 | McDonald’s Holdings Co. Japan, Ltd. | 7,525 | ||||||||
682 | Whitbread PLC | 19,031 | ||||||||
26,556 | ||||||||||
Rubber – Tires – 1.0% | ||||||||||
34 | Compagnie Generale des Etablissements Michelin – Class B | 2,439 | ||||||||
353 | Continental A.G.* | 27,893 | ||||||||
665 | Nokian Renkaat Oyj | 24,389 | ||||||||
1,711 | Pirelli & C S.P.A. | 13,831 | ||||||||
700 | Sumitomo Rubber Industries, Inc. | 7,313 | ||||||||
75,865 | ||||||||||
Shipbuilding – 0.3% | ||||||||||
2,000 | SembCorp Marine, Ltd. | 8,371 | ||||||||
10,000 | Yangzijiang Shipbuilding Holdings, Ltd. | 14,887 | ||||||||
23,258 | ||||||||||
Silver Mining – 0.3% | ||||||||||
1,038 | Fresnillo PLC | 26,990 | ||||||||
Soap and Cleaning Preparations – 0.1% | ||||||||||
112 | Henkel KGaA | 5,778 | ||||||||
69 | Reckitt Benckiser Group PLC | 3,792 | ||||||||
9,570 | ||||||||||
Steel – Producers – 0.5% | ||||||||||
12,000 | Kobe Steel, Ltd. | 30,455 | ||||||||
216 | ThyssenKrupp A.G. | 8,942 | ||||||||
39,397 | ||||||||||
Steel – Specialty – 0.3% | ||||||||||
2,000 | Daido Steel Co., Ltd. | 11,753 | ||||||||
1,000 | Hitachi Metals, Ltd. | 12,012 | ||||||||
23,765 | ||||||||||
Steel Pipe and Tube – 0.1% | ||||||||||
60 | Vallourec S.A. | 6,301 | ||||||||
Telecommunication Services – 1.4% | ||||||||||
2,019 | Tele2 A.B. – Class B | 41,937 | ||||||||
4,210 | Telenor A.S.A. | 68,439 | ||||||||
110,376 | ||||||||||
Telephone – Integrated – 2.5% | ||||||||||
20,825 | BT Group PLC | 58,695 | ||||||||
1 | DDI Corp. | 5,778 | ||||||||
100 | Nippon Telegraph & Telephone Corp. | 4,527 | ||||||||
1,888 | Portugal Telecom SGPS S.A. | 21,139 | ||||||||
1,000 | Softbank Corp. | 34,631 | ||||||||
17 | Swisscom A.G. | 7,477 | ||||||||
10,041 | Telecom Italia S.P.A. | 10,894 | ||||||||
1,231 | Telefonica S.A. | 27,903 | ||||||||
1,603 | Telekom Austria A.G. | 22,531 | ||||||||
193,575 | ||||||||||
Television – 0.3% | ||||||||||
5,609 | ITV PLC* | 6,125 | ||||||||
289 | Modern Times Group MTG A.B. | 19,135 | ||||||||
25,260 | ||||||||||
Tobacco – 1.1% | ||||||||||
1,740 | British American Tobacco PLC | 66,822 | ||||||||
546 | Swedish Match A.B. | 15,817 | ||||||||
82,639 | ||||||||||
Tools – Hand Held – 0.1% | ||||||||||
100 | Makita Corp. | 4,090 | ||||||||
Transactional Software – 0% | ||||||||||
142 | Amadeus IT Holding S.A.* | 2,975 |
See Notes to Schedules of Investments and Financial Statements.
34 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Transportation – Marine – 0.7% | ||||||||||
4,000 | Kawasaki Kisen Kaisha, Ltd. | $ | 17,593 | |||||||
1,000 | Mitsui O.S.K. Lines, Ltd. | 6,825 | ||||||||
4,000 | Nippon Yusen K.K. | 17,740 | ||||||||
1,000 | Orient Overseas International, Ltd. | 9,701 | ||||||||
51,859 | ||||||||||
Transportation – Railroad – 0.3% | ||||||||||
1 | Central Japan Railway Co. | 8,378 | ||||||||
294 | Groupe Eurotunnel S.A. | 2,585 | ||||||||
1,000 | Keihin Electric Express Railway | 8,833 | ||||||||
1,223 | QR National, Ltd.* | 3,439 | ||||||||
23,235 | ||||||||||
Transportation – Services – 0.2% | ||||||||||
250 | Deutsche Post A.G. | 4,242 | ||||||||
138 | Koninklijke Vopak N.V. | 6,518 | ||||||||
42 | Kuehne + Nagel International A.G. | 5,841 | ||||||||
16,601 | ||||||||||
Transportation – Truck – 0% | ||||||||||
81 | DSV A/S | 1,791 | ||||||||
Travel Services – 0.1% | ||||||||||
327 | TUI A.G.* | 4,587 | ||||||||
Water – 0.8% | ||||||||||
1,544 | Severn Trent PLC | 35,575 | ||||||||
3,299 | United Utilities Group PLC | 30,445 | ||||||||
66,020 | ||||||||||
Wire and Cable Products – 0.2% | ||||||||||
125 | Bekaert S.A. | 14,346 | ||||||||
Total Common Stock (cost $6,474,817) | 7,665,525 | |||||||||
Preferred Stock – 1.6% | ||||||||||
Automotive – Cars and Light Trucks – 0.9% | ||||||||||
389 | Bayerische Motoren Werke A.G. | 20,010 | ||||||||
49 | Porsche Automobil Holding S.E. | 3,906 | ||||||||
259 | Volkswagen A.G. | 42,010 | ||||||||
65,926 | ||||||||||
Medical Products – 0.4% | ||||||||||
323 | Fresenius A.G. | 27,650 | ||||||||
Soap and Cleaning Preparations – 0.3% | ||||||||||
407 | Henkel A.G. & Co., KGaA | 25,305 | ||||||||
Television – 0% | ||||||||||
78 | ProSiebenSat.1 Media A.G. | 2,345 | ||||||||
Total Preferred Stock (cost $104,332) | 121,226 | |||||||||
Money Market – 1.9% | ||||||||||
149,000 | Janus Cash Liquidity Fund LLC, 0% (cost $149,000) | 149,000 | ||||||||
Total Investments (total cost $6,728,149) – 101.7% | 7,935,751 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (1.7)% | (130,910) | |||||||||
Net Assets – 100% | $ | 7,804,841 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Australia | $ | 452,977 | 5.7% | |||||
Austria | 29,159 | 0.4% | ||||||
Belgium | 99,585 | 1.3% | ||||||
Bermuda | 97,500 | 1.2% | ||||||
Denmark | 181,674 | 2.3% | ||||||
Finland | 285,200 | 3.6% | ||||||
France | 508,732 | 6.4% | ||||||
Germany | 692,324 | 8.7% | ||||||
Hong Kong | 416,068 | 5.2% | ||||||
Israel | 18,216 | 0.2% | ||||||
Italy | 93,356 | 1.2% | ||||||
Japan | 1,054,635 | 13.3% | ||||||
Jersey | 188,328 | 2.4% | ||||||
Luxembourg | 28,966 | 0.4% | ||||||
Netherlands | 96,783 | 1.2% | ||||||
Norway | 78,846 | 1.0% | ||||||
Portugal | 45,241 | 0.6% | ||||||
Singapore | 233,971 | 2.9% | ||||||
Spain | 173,795 | 2.2% | ||||||
Sweden | 540,705 | 6.8% | ||||||
Switzerland | 738,884 | 9.3% | ||||||
United Kingdom | 1,731,806 | 21.8% | ||||||
United States†† | 149,000 | 1.9% | ||||||
Total | $ | 7,935,751 | 100.0% |
†† | Includes all Cash Equivalents. |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 35
Table of Contents
INTECH Risk-Managed Value Fund (unaudited)
Fund Snapshot This fund uses a mathematically-based investment process that seeks to capitalize on the natural volatility of stock prices. The primary aim of this strategy is to outperform the benchmark index without increasing risk. | Managed by INTECH Investment Management LLC |
Performance Overview
For the six-month period ended December 31, 2010, INTECH Risk-Managed Value Fund returned 21.41% for its Class I Shares. This compares to the 21.74% return posted by the Russell 1000 Value Index, the Fund’s benchmark.
Investment Strategy in This Environment
While INTECH does not employ fundamental analysis in the management of the Fund, fundamentals can have a significant impact on the general direction of the market in which we participate. The Fund’s goal is to produce long-term returns in excess of its benchmark with an equal or lesser amount of risk.
INTECH’s mathematical investment process seeks to build a more efficient portfolio than its benchmark, the Russell 1000 Value Index. With a focus on risk management, investment decisions are governed by a mathematical investment process. The process does not attempt to predict the direction of the market, nor does it have a particular view of any stock in the Fund.
Performance Review
As stock prices moved naturally throughout the period, we continued to implement our mathematical process in a disciplined manner in an effort to maintain a more efficient portfolio than the benchmark, without increasing relative risk. While other factors may influence performance over the short term, we believe that the consistent application of our process will help the Fund perform well over the long term.
In INTECH’s history, which spans more than 23 years, we have experienced periods of both underperformance and outperformance relative to the benchmark. From our perspective, the key is to keep periods of underperformance both short in duration and mild in scope. INTECH aims to achieve excess returns over the long term and we believe the Fund remains well positioned for long-term capital growth.
Investment Strategy and Outlook
INTECH’s mathematical, risk-managed investment process seeks to outperform the Russell 1000 Value Index over the long term, while attempting to manage risk relative to the benchmark. We will continue implementing the process in a disciplined and deliberate manner in an effort to achieve our long-term performance goals. The Fund may underperform during shorter time periods, but has the goal of outperformance over the long term. Risk management remains essential to the investment process. We will continue to make marginal improvements to the mathematical process, seeking an efficient portfolio that offers better long-term results than the benchmark, regardless of the market’s direction.
Thank you for your investment in INTECH Risk-Managed Value Fund.
36 | DECEMBER 31, 2010
Table of Contents
(unaudited)
INTECH Risk-Managed Value Fund At A Glance
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
Exxon Mobil Corp. Oil Companies – Integrated | 2.1% | |||
Berkshire Hathaway, Inc. – Class B Reinsurance | 2.1% | |||
JPMorgan Chase & Co. Diversified Banking Institutions | 1.6% | |||
AT&T, Inc. Telephone – Integrated | 1.6% | |||
Chevron Corp. Oil Companies – Integrated | 1.3% | |||
8.7% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29p01.gif)
Emerging markets comprised 0.2% of total net assets.
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29t01.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29c01.gif)
Janus Risk-Managed Funds | 37
Table of Contents
INTECH Risk-Managed Value Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif29m01.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Since | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Inception* | Operating Expenses | Operating Expenses | ||||||||
INTECH Risk-Managed Value Fund – Class A Shares | |||||||||||||
NAV | 21.21% | 15.06% | 0.96% | 0.96% | 1.05% | 1.00% | |||||||
MOP | 14.24% | 8.39% | –0.23% | –0.23% | |||||||||
INTECH Risk-Managed Value Fund – Class C Shares | |||||||||||||
NAV | 20.82% | 14.24% | 0.21% | 0.21% | 1.80% | 1.75% | |||||||
CDSC | 19.62% | 13.10% | 0.21% | 0.21% | |||||||||
INTECH Risk-Managed Value Fund – Class I Shares | 21.41% | 15.41% | 1.19% | 1.19% | 0.77% | 0.75% | |||||||
INTECH Risk-Managed Value Fund – Class S Shares | 21.10% | 14.81% | 0.71% | 0.71% | 1.27% | 1.25% | |||||||
INTECH Risk-Managed Value Fund – Class T Shares | 21.45% | 15.29% | 0.75% | 0.74% | 1.00% | 1.00% | |||||||
Russell 1000® Value Index | 21.74% | 15.51% | 1.28% | 1.28% | |||||||||
Lipper Quartile – Class I Shares | – | 2nd | 2nd | 2nd | |||||||||
Lipper Ranking – based on total returns for Multi-Cap Value Funds | – | 171/345 | 122/244 | 122/244 | |||||||||
Visit janus.com/advisor/mutual-funds to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) or visit janus.com/advisor/mutual-funds for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
38 | DECEMBER 31, 2010
Table of Contents
(unaudited)
For Class I Shares, Class S Shares, and Class T Shares, a 2% redemption fee may be imposed on shares held for 90 days or less. Performance shown does not reflect this redemption fee and, if reflected, performance would have been lower.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding the distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The proprietary mathematical process used by INTECH Investment Management LLC (“INTECH”) may not achieve the desired results. The rebalancing techniques used by the Fund may result in a higher portfolio turnover rate, higher expenses and potentially higher net taxable gains or losses compared to a “buy and hold” or index fund strategy.
The Fund’s performance may be affected by risks that include those associated with investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares commenced operations on July 6, 2009, after the reorganization of each class of Janus Adviser INTECH Risk-Managed Value Fund (the “JAD predecessor fund”) into corresponding shares of the Fund. Performance shown for each class for periods prior to July 6, 2009, reflects the historical performance of each corresponding class of the JAD predecessor fund prior to the reorganization, calculated using the fees and expenses of the corresponding class of the JAD predecessor fund, respectively, net of any fee and expense limitations or waivers. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class T Shares of the Fund commenced operations on July 6, 2009. Performance shown for Class T Shares for periods prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class I Shares prior to the reorganization, calculated using the fees and expenses of Class T Shares, without the effect of any fee and expense limitations or waivers. If Class T Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class T Shares reflects the fees and expenses of Class T Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class I Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
December 31, 2005 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
See Notes to Schedules of Investments for index definitions.
The weighting of securities within the portfolio may differ significantly from the weightings within the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The predecessor Fund’s inception date – December 30, 2005 |
Janus Risk-Managed Funds | 39
Table of Contents
INTECH Risk-Managed Value Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,213.70 | $ | 5.91 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.86 | $ | 5.40 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,208.20 | $ | 10.13 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,016.03 | $ | 9.25 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,214.10 | $ | 4.52 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.12 | $ | 4.13 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,211.00 | $ | 7.08 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.80 | $ | 6.46 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,213.20 | $ | 5.80 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.96 | $ | 5.30 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.06% for Class A Shares, 1.82% for Class C Shares, 0.81% for Class I Shares, 1.27% for Class S Shares and 1.04% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
40 | DECEMBER 31, 2010
Table of Contents
INTECH Risk-Managed Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Common Stock – 99.4% | ||||||||||
Advertising Agencies – 0% | ||||||||||
700 | Omnicom Group, Inc. | $ | 32,060 | |||||||
Aerospace and Defense – 1.0% | ||||||||||
7,600 | Boeing Co. | 495,976 | ||||||||
300 | Lockheed Martin Corp. | 20,973 | ||||||||
5,700 | Northrop Grumman Corp. | 369,246 | ||||||||
2,200 | Spirit Aerosystems Holdings, Inc.* | 45,782 | ||||||||
931,977 | ||||||||||
Aerospace and Defense – Equipment – 0.5% | ||||||||||
1,200 | B.F. Goodrich Co. | 105,684 | ||||||||
3,300 | BE Aerospace, Inc.* | 122,199 | ||||||||
2,900 | United Technologies Corp. | 228,288 | ||||||||
456,171 | ||||||||||
Agricultural Chemicals – 0.3% | ||||||||||
1,523 | CF Industries Holdings, Inc. | 205,833 | ||||||||
1,700 | Intrepid Potash, Inc.* | 63,393 | ||||||||
269,226 | ||||||||||
Agricultural Operations – 0.2% | ||||||||||
5,900 | Archer-Daniels-Midland Co. | 177,472 | ||||||||
800 | Bunge, Ltd. | 52,416 | ||||||||
229,888 | ||||||||||
Airlines – 0.2% | ||||||||||
300 | Copa Holdings S.A. | 17,652 | ||||||||
10,000 | Southwest Airlines Co. | 129,800 | ||||||||
3,400 | UAL Corp.* | 80,988 | ||||||||
228,440 | ||||||||||
Apparel Manufacturers – 0% | ||||||||||
500 | VF Corp. | 43,090 | ||||||||
Applications Software – 0.8% | ||||||||||
2,800 | Compuware Corp.* | 32,676 | ||||||||
27,100 | Microsoft Corp. | 756,632 | ||||||||
789,308 | ||||||||||
Automotive – Truck Parts and Equipment – Original – 0.7% | ||||||||||
6,200 | Autoliv, Inc. | 489,428 | ||||||||
600 | BorgWarner, Inc.* | 43,416 | ||||||||
400 | Lear Corp.* | 39,484 | ||||||||
1,800 | TRW Automotive Holdings Corp.* | 94,860 | ||||||||
667,188 | ||||||||||
Batteries & Battery Systems – 0.2% | ||||||||||
2,300 | Energizer Holdings, Inc.* | 167,670 | ||||||||
Beverages – Non-Alcoholic – 1.8% | ||||||||||
5,600 | Coca-Cola Co. | 368,312 | ||||||||
8,500 | Coca-Cola Enterprises, Inc. | 212,755 | ||||||||
7,900 | Dr. Pepper Snapple Group, Inc. | 277,764 | ||||||||
600 | Hansen Natural Corp.* | 31,368 | ||||||||
12,400 | PepsiCo, Inc. | 810,092 | ||||||||
1,700,291 | ||||||||||
Beverages – Wine and Spirits – 0.2% | ||||||||||
1,800 | Brown-Forman Corp. – Class B | 125,316 | ||||||||
2,500 | Constellation Brands, Inc. – Class A* | 55,375 | ||||||||
180,691 | ||||||||||
Brewery – 0.4% | ||||||||||
6,900 | Molson Coors Brewing Co. – Class B | 346,311 | ||||||||
Broadcast Services and Programming – 1.4% | ||||||||||
10,000 | Discovery Holding Co. – Class A* | 417,000 | ||||||||
5,800 | Liberty Global, Inc. – Class A* | 205,204 | ||||||||
5,800 | Liberty Media Corp. – Capital – Class A* | 362,848 | ||||||||
4,200 | Liberty Media Corp. – Starz* | 279,216 | ||||||||
1,264,268 | ||||||||||
Building – Heavy Construction – 0.1% | ||||||||||
1,800 | Chicago Bridge & Iron Co. N.V.* | 59,220 | ||||||||
Building – Residential and Commercial – 0.1% | ||||||||||
2,100 | D.R. Horton, Inc. | 25,053 | ||||||||
1,200 | Lennar Corp. – Class A | 22,500 | ||||||||
900 | Toll Brothers, Inc.* | 17,100 | ||||||||
64,653 | ||||||||||
Cable Television – 1.7% | ||||||||||
9,800 | Cablevision Systems New York Group – Class A | 331,632 | ||||||||
27,950 | Comcast Corp. – Class A | 614,061 | ||||||||
9,251 | Time Warner Cable, Inc. – Class A | 610,844 | ||||||||
1,556,537 | ||||||||||
Casino Hotels – 0% | ||||||||||
1,700 | MGM Mirage* | 25,245 | ||||||||
Cellular Telecommunications – 0.9% | ||||||||||
11,800 | MetroPCS Communications, Inc.* | 149,034 | ||||||||
4,400 | N.I.I. Holdings, Inc.* | 196,504 | ||||||||
107,900 | Sprint Nextel Corp.* | 456,417 | ||||||||
801,955 | ||||||||||
Chemicals – Diversified – 1.2% | ||||||||||
2,100 | Dow Chemical Co. | 71,694 | ||||||||
9,400 | E.I. du Pont de Nemours & Co. | 468,872 | ||||||||
1,400 | FMC Corp. | 111,846 | ||||||||
2,900 | Huntsman Corp. | 45,269 | ||||||||
5,200 | PPG Industries, Inc. | 437,164 | ||||||||
1,134,845 | ||||||||||
Chemicals – Specialty – 0.5% | ||||||||||
1,100 | Ashland, Inc. | 55,946 | ||||||||
2,800 | Cabot Corp. | 105,420 | ||||||||
2,400 | Cytec Industries, Inc. | 127,344 | ||||||||
2,200 | Eastman Chemical Co. | 184,976 | ||||||||
600 | Sigma-Aldrich Corp. | 39,936 | ||||||||
513,622 | ||||||||||
Coal – 0.3% | ||||||||||
600 | Alpha Natural Resources, Inc.* | 36,018 | ||||||||
2,100 | Arch Coal, Inc. | 73,626 | ||||||||
2,600 | Peabody Energy Corp. | 166,348 | ||||||||
275,992 | ||||||||||
Coatings and Paint Products – 0.3% | ||||||||||
1,300 | RPM International, Inc. | 28,730 | ||||||||
1,000 | Sherwin-Williams Co. | 83,750 | ||||||||
4,400 | Valspar Corp. | 151,712 | ||||||||
264,192 | ||||||||||
Commercial Banks – 2.5% | ||||||||||
7,800 | Associated Banc-Corp. | 118,170 | ||||||||
1,300 | Bank of Hawaii Corp. | 61,373 | ||||||||
4,700 | BB&T Corp. | 123,563 | ||||||||
14,400 | CapitalSource, Inc. | 102,240 | ||||||||
2,500 | CIT Group, Inc.* | 117,750 | ||||||||
1,700 | City National Corp. | 104,312 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 41
Table of Contents
INTECH Risk-Managed Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Commercial Banks – (continued) | ||||||||||
2,880 | Commerce Bancshares, Inc. | $ | 114,423 | |||||||
3,700 | Cullen/Frost Bankers, Inc. | 226,144 | ||||||||
900 | East West Bancorp., Inc. | 17,595 | ||||||||
4,067 | First Horizon National Corp.* | 47,909 | ||||||||
5,500 | Fulton Financial Corp. | 56,870 | ||||||||
7,700 | M&T Bank Corp. | 670,285 | ||||||||
37,097 | Regions Financial Corp. | 259,679 | ||||||||
2,800 | TCF Financial Corp. | 41,468 | ||||||||
7,900 | Valley National Bancorp. | 112,970 | ||||||||
6,800 | Zions Bancorp. | 164,764 | ||||||||
2,339,515 | ||||||||||
Computers – Integrated Systems – 0.1% | ||||||||||
9,300 | Brocade Communications Systems, Inc.* | 49,197 | ||||||||
1,400 | Diebold, Inc. | 44,870 | ||||||||
94,067 | ||||||||||
Computers – Peripheral Equipment – 0.3% | ||||||||||
7,100 | Lexmark International, Inc. – Class A* | 247,222 | ||||||||
Consulting Services – 0% | ||||||||||
400 | Towers Watson & Co. | 20,824 | ||||||||
Consumer Products – Miscellaneous – 0.6% | ||||||||||
600 | Clorox Co. | 37,968 | ||||||||
2,000 | Jarden Corp. | 61,740 | ||||||||
6,900 | Kimberly-Clark Corp. | 434,976 | ||||||||
534,684 | ||||||||||
Containers – Metal and Glass – 0.4% | ||||||||||
3,300 | Ball Corp. | 224,565 | ||||||||
2,200 | Greif, Inc. | 136,180 | ||||||||
360,745 | ||||||||||
Containers – Paper and Plastic – 0.2% | ||||||||||
1,300 | Bemis Co., Inc. | 42,458 | ||||||||
1,400 | Sealed Air Corp. | 35,630 | ||||||||
2,100 | Sonoco Products Co. | 70,707 | ||||||||
148,795 | ||||||||||
Cosmetics and Toiletries – 1.2% | ||||||||||
2,700 | Alberto-Culver Co. | 100,008 | ||||||||
200 | Colgate-Palmolive Co. | 16,074 | ||||||||
15,200 | Procter & Gamble Co. | 977,816 | ||||||||
1,093,898 | ||||||||||
Cruise Lines – 0.2% | ||||||||||
1,900 | Carnival Corp. (U.S. Shares) | 87,609 | ||||||||
2,600 | Royal Caribbean Cruises, Ltd. (U.S. Shares)* | 122,200 | ||||||||
209,809 | ||||||||||
Data Processing and Management – 0.5% | ||||||||||
1,000 | Broadridge Financial Solutions, Inc. | 21,930 | ||||||||
15,300 | Fidelity National Information Services, Inc. | 419,067 | ||||||||
1,200 | Fiserv, Inc.* | 70,272 | ||||||||
511,269 | ||||||||||
Distribution/Wholesale – 0.2% | ||||||||||
2,900 | Genuine Parts Co. | 148,886 | ||||||||
1,600 | Wesco International, Inc.* | 84,480 | ||||||||
233,366 | ||||||||||
Diversified Banking Institutions – 3.4% | ||||||||||
47,305 | Bank of America Corp. | 631,049 | ||||||||
89,700 | Citigroup, Inc.* | 424,281 | ||||||||
3,000 | Goldman Sachs Group, Inc. | 504,480 | ||||||||
35,800 | JPMorgan Chase & Co. | 1,518,636 | ||||||||
2,300 | Morgan Stanley | 62,583 | ||||||||
3,141,029 | ||||||||||
Diversified Operations – 1.8% | ||||||||||
2,000 | Crane Co. | 82,140 | ||||||||
1,600 | Danaher Corp. | 75,472 | ||||||||
1,300 | Dover Corp. | 75,985 | ||||||||
1,100 | Eaton Corp. | 111,661 | ||||||||
48,200 | General Electric Co. | 881,578 | ||||||||
1,600 | Ingersoll-Rand Co. – Class A | 75,344 | ||||||||
300 | ITT Corp. | 15,633 | ||||||||
1,500 | Leggett & Platt, Inc. | 34,140 | ||||||||
1,500 | Leucadia National Corp. | 43,770 | ||||||||
600 | Parker Hannifin Corp. | 51,780 | ||||||||
1,300 | Trinity Industries, Inc. | 34,593 | ||||||||
5,600 | Tyco International, Ltd. (U.S. Shares) | 232,064 | ||||||||
1,714,160 | ||||||||||
E-Commerce/Services – 0.8% | ||||||||||
4,000 | eBay, Inc.* | 111,320 | ||||||||
17,600 | Expedia, Inc. | 441,584 | ||||||||
3,600 | IAC/InterActiveCorp* | 103,320 | ||||||||
6,800 | Liberty Media Corp. – Interactive – Class A* | 107,236 | ||||||||
763,460 | ||||||||||
Electric – Generation – 0.1% | ||||||||||
5,100 | AES Corp.* | 62,118 | ||||||||
Electric – Integrated – 8.9% | ||||||||||
10,200 | Allegheny Energy, Inc. | 247,248 | ||||||||
8,700 | Alliant Energy Corp. | 319,899 | ||||||||
6,400 | Ameren Corp. | 180,416 | ||||||||
10,700 | American Electric Power Co., Inc. | 384,986 | ||||||||
11,100 | CMS Energy Corp. | 206,460 | ||||||||
5,700 | Consolidated Edison, Inc. | 282,549 | ||||||||
9,900 | Dominion Resources, Inc. | 422,928 | ||||||||
800 | DPL, Inc. | 20,568 | ||||||||
10,200 | DTE Energy Co. | 462,264 | ||||||||
27,500 | Duke Energy Corp. | 489,775 | ||||||||
3,200 | Edison International | 123,520 | ||||||||
2,100 | Entergy Corp. | 148,743 | ||||||||
800 | Exelon Corp. | 33,312 | ||||||||
1,100 | FirstEnergy Corp. | 40,722 | ||||||||
5,300 | FPL Group, Inc. | 275,547 | ||||||||
3,300 | Great Plains Energy, Inc. | 63,987 | ||||||||
4,700 | Hawaiian Electric Industries, Inc. | 107,113 | ||||||||
6,400 | Integrys Energy Group, Inc. | 310,464 | ||||||||
1,000 | MDU Resources Group, Inc. | 20,270 | ||||||||
8,800 | Northeast Utilities | 280,544 | ||||||||
4,300 | NSTAR | 181,417 | ||||||||
5,300 | OGE Energy Corp. | 241,362 | ||||||||
12,700 | Pepco Holdings, Inc. | 231,775 | ||||||||
6,700 | PG&E Corp. | 320,528 | ||||||||
6,900 | Pinnacle West Capital Corp. | 286,005 | ||||||||
4,800 | PPL Corp. | 126,336 | ||||||||
6,000 | Progress Energy, Inc. | 260,880 | ||||||||
2,700 | Public Service Enterprise Group, Inc. | 85,887 | ||||||||
4,900 | SCANA Corp. | 198,940 | ||||||||
12,400 | Sierra Pacific Resources | 174,220 | ||||||||
8,400 | Southern Co. | 321,132 | ||||||||
42,900 | TECO Energy, Inc. | 763,620 |
See Notes to Schedules of Investments and Financial Statements.
42 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Electric – Integrated – (continued) | ||||||||||
7,000 | Westar Energy, Inc. | $ | 176,120 | |||||||
4,100 | Wisconsin Energy Corp. | 241,326 | ||||||||
9,600 | Xcel Energy, Inc. | 226,080 | ||||||||
8,256,943 | ||||||||||
Electric – Transmission – 0% | ||||||||||
400 | ITC Holdings Corp. | 24,792 | ||||||||
Electronic Components – Miscellaneous – 0.1% | ||||||||||
1,700 | Jabil Circuit, Inc. | 34,153 | ||||||||
2,800 | Vishay Intertechnology, Inc.* | 41,104 | ||||||||
75,257 | ||||||||||
Electronic Components – Semiconductors – 0.6% | ||||||||||
11,600 | Intel Corp. | 243,948 | ||||||||
1,500 | MEMC Electronic Materials, Inc.* | 16,890 | ||||||||
8,300 | Texas Instruments, Inc. | 269,750 | ||||||||
530,588 | ||||||||||
Electronic Connectors – 0.1% | ||||||||||
1,500 | Thomas & Betts Corp.* | 72,450 | ||||||||
Electronic Design Automation – 0.1% | ||||||||||
3,100 | Synopsys, Inc.* | 83,421 | ||||||||
Energy – Alternate Sources – 0% | ||||||||||
1,200 | Covanta Holding Corp.* | 20,628 | ||||||||
Engineering – Research and Development Services – 0.3% | ||||||||||
1,400 | Fluor Corp. | 92,764 | ||||||||
4,000 | KBR, Inc. | 121,880 | ||||||||
2,600 | McDermott International, Inc. (U.S. Shares)* | 53,794 | ||||||||
268,438 | ||||||||||
Enterprise Software/Services – 0.2% | ||||||||||
1,500 | CA, Inc. | 36,660 | ||||||||
32,000 | Novell, Inc.* | 189,440 | ||||||||
226,100 | ||||||||||
Entertainment Software – 0.1% | ||||||||||
3,800 | Activision Blizzard, Inc. | 47,272 | ||||||||
1,300 | Electronic Arts, Inc.* | 21,294 | ||||||||
68,566 | ||||||||||
Fiduciary Banks – 0.3% | ||||||||||
9,724 | Bank of New York Mellon Corp. | 293,665 | ||||||||
300 | State Street Corp. | 13,902 | ||||||||
307,567 | ||||||||||
Finance – Consumer Loans – 0.1% | ||||||||||
7,900 | SLM Corp.* | 99,461 | ||||||||
Finance – Credit Card – 0.3% | ||||||||||
16,500 | Discover Financial Services | 305,745 | ||||||||
Finance – Investment Bankers/Brokers – 0.4% | ||||||||||
2,700 | E*TRADE Financial Corp.* | 43,200 | ||||||||
6,300 | Jefferies Group, Inc. | 167,769 | ||||||||
6,400 | Raymond James Financial, Inc. | 209,280 | ||||||||
420,249 | ||||||||||
Finance – Other Services – 0.1% | ||||||||||
2,500 | NYSE Euronext | 74,950 | ||||||||
Financial Guarantee Insurance – 0.3% | ||||||||||
3,000 | Assured Guaranty, Ltd. | 53,100 | ||||||||
18,900 | MBIA, Inc.* | 226,611 | ||||||||
279,711 | ||||||||||
Food – Baking – 0% | ||||||||||
1,700 | Flowers Foods, Inc. | 45,747 | ||||||||
Food – Confectionary – 0.6% | ||||||||||
6,400 | Hershey Co. | 301,760 | ||||||||
3,600 | J.M. Smucker Co. | 236,340 | ||||||||
538,100 | ||||||||||
Food – Dairy Products – 0% | ||||||||||
2,200 | Dean Foods Co.* | 19,448 | ||||||||
Food – Meat Products – 0.6% | ||||||||||
5,600 | Hormel Foods Corp. | 287,056 | ||||||||
15,900 | Tyson Foods, Inc. – Class A | 273,798 | ||||||||
560,854 | ||||||||||
Food – Miscellaneous/Diversified – 2.8% | ||||||||||
6,600 | Campbell Soup Co. | 229,350 | ||||||||
13,000 | ConAgra Foods, Inc. | 293,540 | ||||||||
2,600 | Corn Products International, Inc. | 119,600 | ||||||||
15,000 | General Mills, Inc. | 533,850 | ||||||||
9,700 | H.J. Heinz Co. | 479,762 | ||||||||
1,000 | Kellogg Co. | 51,080 | ||||||||
16,352 | Kraft Foods, Inc. – Class A | 515,252 | ||||||||
2,000 | McCormick & Co., Inc. | 93,060 | ||||||||
15,300 | Sara Lee Corp. | 267,903 | ||||||||
2,583,397 | ||||||||||
Food – Retail – 0.1% | ||||||||||
2,900 | Kroger Co. | 64,844 | ||||||||
2,800 | Safeway, Inc. | 62,972 | ||||||||
127,816 | ||||||||||
Forestry – 0.2% | ||||||||||
1,600 | Plum Creek Timber Co., Inc. | 59,920 | ||||||||
4,640 | Weyerhaeuser Co. | 87,835 | ||||||||
147,755 | ||||||||||
Funeral Services and Related Items – 0.2% | ||||||||||
19,900 | Service Corp. International | 164,175 | ||||||||
Gas – Distribution – 1.8% | ||||||||||
3,200 | AGL Resources, Inc. | 114,720 | ||||||||
4,000 | Atmos Energy Corp. | 124,800 | ||||||||
13,600 | CenterPoint Energy, Inc. | 213,792 | ||||||||
900 | Energen Corp. | 43,434 | ||||||||
1,000 | National Fuel Gas Co. | 65,620 | ||||||||
25,200 | NiSource, Inc. | 444,024 | ||||||||
10,900 | Questar Corp. | 189,769 | ||||||||
2,800 | Sempra Energy | 146,944 | ||||||||
4,000 | Southern Union Co. | 96,280 | ||||||||
5,600 | UGI Corp. | 176,848 | ||||||||
3,100 | Vectren Corp. | 78,678 | ||||||||
1,694,909 | ||||||||||
Gold Mining – 0.1% | ||||||||||
1,600 | Royal Gold, Inc. | 87,408 | ||||||||
Home Decoration Products – 0.1% | ||||||||||
5,600 | Newell Rubbermaid, Inc. | 101,808 | ||||||||
Hospital Beds and Equipment – 0.1% | ||||||||||
1,500 | Hill-Rom Holdings, Inc. | 59,055 | ||||||||
Hotels and Motels – 0.2% | ||||||||||
1,000 | Hyatt Hotels Corp.* | 45,760 | ||||||||
5,300 | Wyndham Worldwide Corp. | 158,788 | ||||||||
204,548 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 43
Table of Contents
INTECH Risk-Managed Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Human Resources – 0% | ||||||||||
400 | Manpower, Inc. | $ | 25,104 | |||||||
Independent Power Producer – 0.1% | ||||||||||
9,600 | Calpine Corp.* | 128,064 | ||||||||
Instruments – Scientific – 0.1% | ||||||||||
2,000 | PerkinElmer, Inc. | 51,640 | ||||||||
1,000 | Thermo Fisher Scientific, Inc.* | 55,360 | ||||||||
107,000 | ||||||||||
Insurance Brokers – 0.4% | ||||||||||
4,400 | Arthur J. Gallagher & Co. | 127,952 | ||||||||
5,400 | Brown & Brown, Inc. | 129,276 | ||||||||
800 | Erie Indemnity Co. – Class A | 52,376 | ||||||||
2,800 | Marsh & McLennan Cos., Inc. | 76,552 | ||||||||
386,156 | ||||||||||
Internet Security – 0% | ||||||||||
1,600 | Symantec Corp.* | 26,784 | ||||||||
Investment Companies – 0.5% | ||||||||||
29,200 | Ares Capital Corp. | 481,216 | ||||||||
Investment Management and Advisory Services – 0.5% | ||||||||||
5,300 | Ameriprise Financial, Inc. | 305,015 | ||||||||
200 | BlackRock, Inc. | 38,116 | ||||||||
1,000 | Federated Investors, Inc. – Class B | 26,170 | ||||||||
3,500 | INVESCO, Ltd. | 84,210 | ||||||||
453,511 | ||||||||||
Life and Health Insurance – 1.1% | ||||||||||
1,900 | AFLAC, Inc. | 107,217 | ||||||||
1,500 | Principal Financial Group, Inc. | 48,840 | ||||||||
7,200 | Protective Life Corp. | 191,808 | ||||||||
3,300 | Prudential Financial, Inc. | 193,743 | ||||||||
4,600 | Torchmark Corp. | 274,804 | ||||||||
8,100 | Unum Group | 196,182 | ||||||||
1,012,594 | ||||||||||
Linen Supply & Related Items – 0.1% | ||||||||||
2,400 | Cintas Corp. | 67,104 | ||||||||
Machine Tools and Related Products – 0% | ||||||||||
400 | Kennametal, Inc. | 15,784 | ||||||||
Machinery – Construction and Mining – 0% | ||||||||||
900 | Terex Corp.* | 27,936 | ||||||||
Machinery – Electrical – 0% | ||||||||||
300 | Regal-Beloit Corp. | 20,028 | ||||||||
Machinery – Farm – 0.4% | ||||||||||
2,700 | AGCO Corp.* | 136,782 | ||||||||
3,400 | Deere & Co. | 282,370 | ||||||||
419,152 | ||||||||||
Machinery – General Industrial – 0.2% | ||||||||||
1,300 | Babcock & Wilcox Co.* | 33,267 | ||||||||
400 | Gardner Denver, Inc. | 27,528 | ||||||||
700 | IDEX Corp. | 27,384 | ||||||||
1,400 | Wabtec Corp. | 74,046 | ||||||||
162,225 | ||||||||||
Machinery – Print Trade – 0.1% | ||||||||||
1,800 | Zebra Technologies Corp.* | 68,382 | ||||||||
Machinery – Pumps – 0% | ||||||||||
300 | Flowserve Corp. | 35,766 | ||||||||
Medical – Biomedical and Genetic – 1.5% | ||||||||||
12,200 | Amgen, Inc.* | 669,780 | ||||||||
3,400 | Biogen Idec, Inc.* | 227,970 | ||||||||
6,500 | Genzyme Corp.* | 462,800 | ||||||||
1,360,550 | ||||||||||
Medical – Drugs – 3.0% | ||||||||||
2,200 | Abbott Laboratories | 105,402 | ||||||||
15,800 | Bristol-Myers Squibb Co. | 418,384 | ||||||||
400 | Cephalon, Inc.* | 24,688 | ||||||||
5,300 | Eli Lilly & Co. | 185,712 | ||||||||
6,200 | Endo Pharmaceuticals Holdings, Inc.* | 221,402 | ||||||||
2,500 | Forest Laboratories, Inc.* | 79,950 | ||||||||
21,775 | Merck & Co., Inc. | 784,771 | ||||||||
56,371 | Pfizer, Inc. | 987,056 | ||||||||
2,807,365 | ||||||||||
Medical – Generic Drugs – 0.3% | ||||||||||
4,600 | Watson Pharmaceuticals, Inc.* | 237,590 | ||||||||
Medical – HMO – 1.0% | ||||||||||
1,500 | Aetna, Inc. | 45,765 | ||||||||
3,400 | CIGNA Corp. | 124,644 | ||||||||
9,100 | Health Net, Inc.* | 248,339 | ||||||||
4,600 | Humana, Inc.* | 251,804 | ||||||||
3,900 | UnitedHealth Group, Inc. | 140,829 | ||||||||
1,500 | WellPoint, Inc.* | 85,290 | ||||||||
896,671 | ||||||||||
Medical – Hospitals – 0.2% | ||||||||||
1,400 | LifePoint Hospitals, Inc.* | 51,450 | ||||||||
3,600 | Universal Health Services, Inc. – Class B | 156,312 | ||||||||
207,762 | ||||||||||
Medical – Wholesale Drug Distributors – 1.0% | ||||||||||
11,500 | Cardinal Health, Inc. | 440,565 | ||||||||
6,900 | McKesson Corp. | 485,622 | ||||||||
926,187 | ||||||||||
Medical Products – 1.4% | ||||||||||
1,200 | Baxter International, Inc. | 60,744 | ||||||||
1,000 | Cooper Cos., Inc. | 56,340 | ||||||||
15,500 | Johnson & Johnson | 958,675 | ||||||||
1,500 | Teleflex, Inc. | 80,715 | ||||||||
2,100 | Zimmer Holdings, Inc.* | 112,728 | ||||||||
1,269,202 | ||||||||||
Metal – Aluminum – 0% | ||||||||||
2,400 | Alcoa, Inc. | 36,936 | ||||||||
Metal Processors and Fabricators – 0.1% | ||||||||||
1,400 | Timken Co. | 66,822 | ||||||||
Miscellaneous Manufacturing – 0.2% | ||||||||||
3,800 | Aptargroup, Inc. | 180,766 | ||||||||
Multi-Line Insurance – 3.1% | ||||||||||
3,700 | ACE, Ltd. (U.S. Shares) | 230,325 | ||||||||
5,400 | Allstate Corp. | 172,152 | ||||||||
7,600 | American Financial Group, Inc. | 245,404 | ||||||||
6,100 | American International Group, Inc.* | 351,482 | ||||||||
12,200 | Assurant, Inc. | 469,944 | ||||||||
4,700 | Cincinnati Financial Corp. | 148,943 | ||||||||
1,500 | Genworth Financial, Inc. – Class A* | 19,710 | ||||||||
2,400 | Hartford Financial Services Group, Inc. | 63,576 | ||||||||
16,400 | Loews Corp. | 638,124 | ||||||||
4,400 | MetLife, Inc. | 195,536 |
See Notes to Schedules of Investments and Financial Statements.
44 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Multi-Line Insurance – (continued) | ||||||||||
14,200 | Old Republic International Corp. | $ | 193,546 | |||||||
7,200 | XL Capital, Ltd. | 157,104 | ||||||||
2,885,846 | ||||||||||
Multimedia – 2.1% | ||||||||||
2,600 | McGraw-Hill Cos., Inc. | 94,666 | ||||||||
10,100 | News Corp. – Class A | 147,056 | ||||||||
3,300 | Thomson Reuters Corp. | 122,991 | ||||||||
10,400 | Time Warner, Inc. | 334,568 | ||||||||
13,000 | Viacom, Inc. – Class B | 514,930 | ||||||||
18,900 | Walt Disney Co. | 708,939 | ||||||||
1,923,150 | ||||||||||
Non-Hazardous Waste Disposal – 0.3% | ||||||||||
4,800 | Republic Services, Inc. | 143,328 | ||||||||
2,700 | Waste Connections, Inc. | 74,331 | ||||||||
2,600 | Waste Management, Inc. | 95,862 | ||||||||
313,521 | ||||||||||
Office Automation and Equipment – 0.1% | ||||||||||
700 | Pitney Bowes, Inc. | 16,926 | ||||||||
7,483 | Xerox Corp. | 86,204 | ||||||||
103,130 | ||||||||||
Office Supplies and Forms – 0% | ||||||||||
1,100 | Avery Dennison Corp. | 46,574 | ||||||||
Oil – Field Services – 0.5% | ||||||||||
700 | Oceaneering International, Inc.* | 51,541 | ||||||||
700 | Oil States International, Inc.* | 44,863 | ||||||||
2,729 | Schlumberger, Ltd. (U.S. Shares) | 227,871 | ||||||||
3,400 | Superior Energy Services, Inc.* | 118,966 | ||||||||
2,600 | Weatherford International, Ltd.* | 59,280 | ||||||||
502,521 | ||||||||||
Oil and Gas Drilling – 0.4% | ||||||||||
500 | Atwood Oceanics, Inc.* | 18,685 | ||||||||
300 | Diamond Offshore Drilling, Inc. | 20,061 | ||||||||
500 | Helmerich & Payne, Inc. | 24,240 | ||||||||
5,100 | Patterson-UTI Energy, Inc. | 109,905 | ||||||||
4,100 | Pride International, Inc.* | 135,300 | ||||||||
2,600 | Rowan Cos., Inc.* | 90,766 | ||||||||
398,957 | ||||||||||
Oil Companies – Exploration and Production – 2.9% | ||||||||||
3,000 | Anadarko Petroleum Corp. | 228,480 | ||||||||
1,524 | Apache Corp. | 181,706 | ||||||||
4,200 | Denbury Resources, Inc.* | 80,178 | ||||||||
800 | Devon Energy Corp. | 62,808 | ||||||||
1,200 | Forest Oil Corp.* | 45,564 | ||||||||
300 | Newfield Exploration Co.* | 21,633 | ||||||||
1,800 | Noble Energy, Inc. | 154,944 | ||||||||
9,200 | Occidental Petroleum Corp. | 902,520 | ||||||||
5,100 | Pioneer Natural Resources Co. | 442,782 | ||||||||
1,800 | Plains Exploration & Production Co.* | 57,852 | ||||||||
2,100 | QEP Resources, Inc. | 76,251 | ||||||||
1,000 | SM Energy Co. | 58,930 | ||||||||
3,500 | Whitting Petroleum Corp.* | 410,165 | ||||||||
2,723,813 | ||||||||||
Oil Companies – Integrated – 4.8% | ||||||||||
13,800 | Chevron Corp. | 1,259,250 | ||||||||
13,793 | ConocoPhillips | 939,303 | ||||||||
27,429 | Exxon Mobil Corp. | 2,005,609 | ||||||||
1,400 | Hess Corp. | 107,156 | ||||||||
2,500 | Marathon Oil Corp. | 92,575 | ||||||||
1,000 | Murphy Oil Corp. | 74,550 | ||||||||
4,478,443 | ||||||||||
Oil Field Machinery and Equipment – 0.2% | ||||||||||
1,400 | Cameron International Corp.* | 71,022 | ||||||||
600 | Dresser-Rand Group, Inc.* | 25,554 | ||||||||
1,600 | National Oilwell Varco, Inc. | 107,600 | ||||||||
204,176 | ||||||||||
Oil Refining and Marketing – 0.6% | ||||||||||
1,300 | Frontier Oil Corp.* | 23,413 | ||||||||
10,100 | Sunoco, Inc. | 407,131 | ||||||||
3,400 | Tesoro Corp.* | 63,036 | ||||||||
1,600 | Valero Energy Corp. | 36,992 | ||||||||
530,572 | ||||||||||
Paper and Related Products – 0.3% | ||||||||||
1,000 | Domtar Corp. (U.S. Shares) | 75,920 | ||||||||
700 | MeadWestvaco Corp. | 18,312 | ||||||||
2,800 | Rayonier, Inc. | 147,056 | ||||||||
241,288 | ||||||||||
Pipelines – 0.5% | ||||||||||
6,500 | El Paso Corp. | 89,440 | ||||||||
3,300 | Oneok, Inc. | 183,051 | ||||||||
6,200 | Spectra Energy Corp. | 154,938 | ||||||||
427,429 | ||||||||||
Power Converters and Power Supply Equipment – 0.1% | ||||||||||
600 | Hubbell, Inc. – Class A | 36,078 | ||||||||
1,900 | SunPower Corp. – Class A* | 24,377 | ||||||||
60,455 | ||||||||||
Private Corrections – 0.2% | ||||||||||
6,200 | Corrections Corp. of America* | 155,372 | ||||||||
Property and Casualty Insurance – 2.4% | ||||||||||
600 | Alleghany Corp.* | 183,822 | ||||||||
2,000 | Arch Capital Group, Ltd.* | 176,100 | ||||||||
6,200 | Chubb Corp. | 369,768 | ||||||||
11,800 | Fidelity National Financial, Inc. – Class A | 161,424 | ||||||||
1,800 | Hanover Insurance Group, Inc. | 84,096 | ||||||||
1,300 | HCC Insurance Holdings, Inc. | 37,622 | ||||||||
300 | Markel Corp.* | 113,439 | ||||||||
25,900 | Progressive Corp. | 514,633 | ||||||||
9,100 | Travelers Cos., Inc. | 506,961 | ||||||||
5,000 | W. R. Berkley Corp. | 136,900 | ||||||||
2,284,765 | ||||||||||
Racetracks – 0.1% | ||||||||||
2,000 | Penn National Gaming, Inc.* | 70,300 | ||||||||
Real Estate Operating/Development – 0% | ||||||||||
1,700 | Forest City Enterprises, Inc. – Class A* | 28,373 | ||||||||
186 | Howard Hughes Corp.* | 10,122 | ||||||||
38,495 | ||||||||||
Reinsurance – 3.3% | ||||||||||
3,100 | Allied World Assurance Co. Holdings, Ltd. | 184,264 | ||||||||
4,700 | Aspen Insurance Holdings, Ltd. | 134,514 | ||||||||
2,500 | Axis Capital Holdings, Ltd. | 89,700 | ||||||||
25,000 | Berkshire Hathaway, Inc. – Class B* | 2,002,750 | ||||||||
1,600 | Endurance Specialty Holdings, Ltd. | 73,712 |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 45
Table of Contents
INTECH Risk-Managed Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Reinsurance – (continued) | ||||||||||
1,400 | Everest Re Group, Ltd. | $ | 118,748 | |||||||
2,000 | PartnerRe, Ltd. | 160,700 | ||||||||
1,900 | Reinsurance Group of America, Inc. | 102,049 | ||||||||
1,400 | RenaissanceRe Holdings, Ltd. | 89,166 | ||||||||
900 | Transatlantic Holdings, Inc. | 46,458 | ||||||||
1,100 | Validus Holdings, Ltd. | 33,671 | ||||||||
3,035,732 | ||||||||||
REIT – Apartments – 1.7% | ||||||||||
4,700 | Apartment Investment & Management Co. – Class A | 121,448 | ||||||||
2,312 | Avalonbay Communities, Inc. | 260,216 | ||||||||
3,300 | BRE Properties, Inc. – Class A | 143,550 | ||||||||
1,200 | Camden Property Trust | 64,776 | ||||||||
12,000 | Equity Residential | 623,400 | ||||||||
1,300 | Essex Property Trust, Inc. | 148,486 | ||||||||
10,400 | UDR, Inc. | 244,608 | ||||||||
1,606,484 | ||||||||||
REIT – Diversified – 0.3% | ||||||||||
400 | Digital Realty Trust, Inc. | 20,616 | ||||||||
3,200 | Vornado Realty Trust | 266,656 | ||||||||
287,272 | ||||||||||
REIT – Health Care – 1.3% | ||||||||||
5,800 | HCP, Inc. | 213,382 | ||||||||
3,800 | Heath Care REIT, Inc. | 181,032 | ||||||||
6,200 | Nationwide Health Properties, Inc. | 225,556 | ||||||||
7,300 | Senior Housing Property Trust | 160,162 | ||||||||
8,400 | Ventas, Inc. | 440,832 | ||||||||
1,220,964 | ||||||||||
REIT – Hotels – 0.2% | ||||||||||
700 | Hospitality Properties Trust | 16,128 | ||||||||
9,057 | Host Hotels & Resorts, Inc. | 161,849 | ||||||||
177,977 | ||||||||||
REIT – Mortgage – 0.6% | ||||||||||
24,300 | Annaly Mortgage Management, Inc. | 435,456 | ||||||||
28,600 | Chimera Investment Corp. | 117,546 | ||||||||
553,002 | ||||||||||
REIT – Office Property – 0.8% | ||||||||||
1,300 | Alexandria Real Estate Equities, Inc. | 95,238 | ||||||||
3,800 | Boston Properties, Inc. | 327,180 | ||||||||
2,200 | Brandywine Realty Trust, Inc. | 25,630 | ||||||||
9,400 | Douglas Emmett, Inc. | 156,040 | ||||||||
1,900 | SL Green Realty Corp. | 128,269 | ||||||||
732,357 | ||||||||||
REIT – Regional Malls – 0.6% | ||||||||||
1,900 | General Growth Properties, Inc. | 29,412 | ||||||||
2,849 | Macerich Co. | 134,957 | ||||||||
2,423 | Simon Property Group, Inc. | 241,064 | ||||||||
2,200 | Taubman Centers, Inc. | 111,056 | ||||||||
516,489 | ||||||||||
REIT – Shopping Centers – 0.3% | ||||||||||
1,800 | Developers Diversified Realty Corp. | 25,362 | ||||||||
1,800 | Federal Realty Investment Trust | 140,274 | ||||||||
3,100 | Kimco Realty Corp. | 55,924 | ||||||||
1,500 | Regency Centers Corp. | 63,360 | ||||||||
1,000 | Weingarten Realty Investors | 23,760 | ||||||||
308,680 | ||||||||||
REIT – Single Tenant – 0.2% | ||||||||||
4,600 | Realty Income Corp. | 157,320 | ||||||||
REIT – Storage – 0.1% | ||||||||||
900 | Public Storage | 91,278 | ||||||||
REIT – Warehouse and Industrial – 0.1% | ||||||||||
3,700 | ProLogis | 53,428 | ||||||||
Retail – Apparel and Shoe – 0.1% | ||||||||||
4,900 | American Eagle Outfitters, Inc. | 71,687 | ||||||||
2,700 | Foot Locker, Inc. | 52,974 | ||||||||
124,661 | ||||||||||
Retail – Automobile – 0.1% | ||||||||||
3,300 | AutoNation, Inc.* | 93,060 | ||||||||
Retail – Computer Equipment – 0% | ||||||||||
1,200 | GameStop Corp. – Class A* | 27,456 | ||||||||
Retail – Consumer Electronics – 0.1% | ||||||||||
3,200 | RadioShack Corp. | 59,168 | ||||||||
Retail – Discount – 0.8% | ||||||||||
3,400 | BJ’s Wholesale Club, Inc.* | 162,860 | ||||||||
10,100 | Wal-Mart Stores, Inc. | 544,693 | ||||||||
707,553 | ||||||||||
Retail – Drug Store – 0.2% | ||||||||||
2,600 | CVS Caremark Corp. | 90,402 | ||||||||
2,000 | Walgreen Co. | 77,920 | ||||||||
168,322 | ||||||||||
Retail – Jewelry – 0.1% | ||||||||||
2,100 | Signet Jewelers, Ltd.* | 91,140 | ||||||||
Retail – Major Department Stores – 0% | ||||||||||
1,200 | JC Penney Co., Inc. | 38,772 | ||||||||
Retail – Regional Department Stores – 0.1% | ||||||||||
3,500 | Macy’s, Inc. | 88,550 | ||||||||
Retirement and Aged Care – 0% | ||||||||||
1,300 | Brookdale Senior Living, Inc.* | 27,833 | ||||||||
Savings/Loan/Thrifts – 0.8% | ||||||||||
8,300 | Hudson City Bancorp., Inc. | 105,742 | ||||||||
34,600 | New York Community Bancorp., Inc. | 652,210 | ||||||||
757,952 | ||||||||||
Semiconductor Components/Integrated Circuits – 0% | ||||||||||
2,800 | Atmel Corp.* | 34,496 | ||||||||
Semiconductor Equipment – 0.2% | ||||||||||
5,800 | KLA-Tencor Corp. | 224,112 | ||||||||
Super-Regional Banks – 3.1% | ||||||||||
5,100 | Capital One Financial Corp. | 217,056 | ||||||||
7,600 | Comerica, Inc. | 321,024 | ||||||||
11,300 | Fifth Third Bancorp. | 165,884 | ||||||||
19,900 | Huntington Bancshares, Inc. | 136,713 | ||||||||
26,200 | Keycorp | 231,870 | ||||||||
9,783 | PNC Financial Services Group, Inc. | 594,024 | ||||||||
3,500 | SunTrust Banks, Inc. | 103,285 |
See Notes to Schedules of Investments and Financial Statements.
46 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares | Value | |||||||||
Super-Regional Banks – (continued) | ||||||||||
22,700 | U.S. Bancorp. | $ | 612,219 | |||||||
17,861 | Wells Fargo & Co. | 553,512 | ||||||||
2,935,587 | ||||||||||
Telecommunication Equipment – 0.1% | ||||||||||
1,600 | CommScope, Inc.* | 49,952 | ||||||||
2,800 | Tellabs, Inc. | 18,984 | ||||||||
68,936 | ||||||||||
Telecommunication Equipment – Fiber Optics – 0.1% | ||||||||||
3,200 | Corning, Inc. | 61,824 | ||||||||
Telecommunication Services – 0.6% | ||||||||||
1,600 | Amdocs, Ltd. (U.S. Shares)* | 43,952 | ||||||||
19,200 | Virgin Media, Inc. | 523,008 | ||||||||
566,960 | ||||||||||
Telephone – Integrated – 4.3% | ||||||||||
50,110 | AT&T, Inc. | 1,472,232 | ||||||||
14,832 | CenturyLink, Inc. | 684,794 | ||||||||
12,795 | Frontier Communications Corp. | 124,495 | ||||||||
120,100 | Qwest Communications International, Inc. | 913,961 | ||||||||
13,944 | Verizon Communications, Inc. | 498,916 | ||||||||
21,200 | Windstream Corp. | 295,528 | ||||||||
3,989,926 | ||||||||||
Television – 0.1% | ||||||||||
4,200 | CBS Corp. – Class B | 80,010 | ||||||||
Tobacco – 1.6% | ||||||||||
20,100 | Altria Group, Inc. | 494,862 | ||||||||
900 | Lorillard, Inc. | 73,854 | ||||||||
3,700 | Philip Morris International, Inc. | 216,561 | ||||||||
21,100 | Reynolds American, Inc. | 688,282 | ||||||||
1,473,559 | ||||||||||
Tools – Hand Held – 0.6% | ||||||||||
1,200 | Snap-On, Inc. | 67,896 | ||||||||
7,555 | Stanley Works | 505,203 | ||||||||
573,099 | ||||||||||
Toys – 0.1% | ||||||||||
5,300 | Mattel, Inc. | 134,779 | ||||||||
Transportation – Marine – 0.1% | ||||||||||
1,500 | Alexander & Baldwin, Inc. | 60,045 | ||||||||
900 | Kirby Corp.* | 39,645 | ||||||||
300 | Tidewater, Inc. | 16,152 | ||||||||
115,842 | ||||||||||
Transportation – Railroad – 0.7% | ||||||||||
2,200 | CSX Corp. | 142,142 | ||||||||
1,500 | Norfolk Southern Corp. | 94,230 | ||||||||
4,100 | Union Pacific Corp. | 379,906 | ||||||||
616,278 | ||||||||||
Transportation – Services – 0% | ||||||||||
400 | FedEx Corp. | 37,204 | ||||||||
Vitamins and Nutrition Products – 0.4% | ||||||||||
5,400 | Mead Johnson Nutrition Co. – Class A | 336,150 | ||||||||
Water – 0.4% | ||||||||||
6,000 | American Water Works Co., Inc. | 151,740 | ||||||||
9,400 | Aqua America, Inc. | 211,312 | ||||||||
363,052 | ||||||||||
Web Portals/Internet Service Providers ��� 0.1% | ||||||||||
2,300 | AOL, Inc.* | 54,533 | ||||||||
Wireless Equipment – 0.4% | ||||||||||
36,300 | Motorola, Inc.* | 329,241 | ||||||||
X-Ray Equipment – 0.1% | ||||||||||
2,900 | Hologic, Inc.* | 54,578 | ||||||||
Total Common Stock (cost $77,928,659) | 92,718,767 | |||||||||
Money Market – 6.0% | ||||||||||
5,578,794 | Janus Cash Liquidity Fund LLC, 0% (cost $5,578,794) | 5,578,794 | ||||||||
Total Investments (total cost $83,507,453) – 105.4% | 98,297,561 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (5.4)% | (5,010,289) | |||||||||
Net Assets – 100% | $ | 93,287,272 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Bermuda | $ | 1,157,177 | 1.2% | |||||
Canada | 122,991 | 0.1% | ||||||
Guernsey | 43,952 | 0.1% | ||||||
Ireland | 232,448 | 0.2% | ||||||
Liberia | 122,200 | 0.1% | ||||||
Netherlands | 59,220 | 0.1% | ||||||
Netherlands Antilles | 227,871 | 0.2% | ||||||
Panama | 159,055 | 0.2% | ||||||
Switzerland | 705,933 | 0.7% | ||||||
United States†† | 95,466,714 | 97.1% | ||||||
Total | $ | 98,297,561 | 100.0% |
†† | Includes Cash Equivalents (91.4% excluding Cash Equivalents). |
See Notes to Schedules of Investments and Financial Statements.
Janus Risk-Managed Funds | 47
Table of Contents
Statements of Assets and Liabilities
INTECH | INTECH | INTECH | INTECH | |||||||||||||
As of December 31, 2010 (unaudited) | Risk-Managed | Risk-Managed | Risk-Managed | Risk-Managed | ||||||||||||
(all numbers in thousands except net asset value per share) | Core Fund | Growth Fund | International Fund | Value Fund | ||||||||||||
Assets: | ||||||||||||||||
Investments at cost | $ | 249,085 | $ | 267,736 | $ | 6,728 | $ | 83,507 | ||||||||
Unaffiliated investments at value | $ | 299,680 | $ | 333,963 | $ | 7,787 | $ | 92,719 | ||||||||
Affiliated investments at value | 1,179 | – | 149 | 5,579 | ||||||||||||
Cash | 57 | – | – | 49 | ||||||||||||
Receivables: | ||||||||||||||||
Investments sold | – | 8,122 | 603 | – | ||||||||||||
Fund shares sold | 257 | 47 | – | – | ||||||||||||
Dividends | 352 | 305 | 8 | 156 | ||||||||||||
Foreign dividend tax reclaim | – | 1 | 4 | – | ||||||||||||
Due from adviser | – | – | 49 | – | ||||||||||||
Non-interested Trustees’ deferred compensation | 8 | 9 | – | 3 | ||||||||||||
Other assets | 3 | 9 | 11 | 1 | ||||||||||||
Total Assets | 301,536 | 342,456 | 8,611 | 98,507 | ||||||||||||
Liabilities: | ||||||||||||||||
Payables: | �� | |||||||||||||||
Due to custodian | – | 1,758 | – | – | ||||||||||||
Investments purchased | 203 | 4,971 | 700 | 5,023 | ||||||||||||
Fund shares repurchased | 240 | 173 | – | 84 | ||||||||||||
Dividends | 2 | 1 | – | – | ||||||||||||
Advisory fees | 132 | 157 | 4 | 25 | ||||||||||||
Administrative services fees | 31 | 3 | 1 | – | ||||||||||||
Distribution fees and shareholder servicing fees | 9 | 8 | 3 | 1 | ||||||||||||
Administrative, networking and omnibus fees | 17 | – | – | 7 | ||||||||||||
Non-interested Trustees’ fees and expenses | 2 | 4 | – | – | ||||||||||||
Non-interested Trustees’ deferred compensation fees | 8 | 9 | – | 3 | ||||||||||||
Accrued expenses and other payables | 289 | 97 | 98 | 77 | ||||||||||||
Total Liabilities | 933 | 7,181 | 806 | 5,220 | ||||||||||||
Net Assets | $ | 300,603 | $ | 335,275 | $ | 7,805 | $ | 93,287 |
See footnotes at the end of the Statements.
See Notes to Financial Statements.
48 | DECEMBER 31, 2010
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Statements of Assets and Liabilities (continued)
INTECH | INTECH | INTECH | INTECH | |||||||||||||
As of December 31, 2010 (unaudited) | Risk-Managed | Risk-Managed | Risk-Managed | Risk-Managed | ||||||||||||
(all numbers in thousands except net asset value per share) | Core Fund | Growth Fund | International Fund | Value Fund | ||||||||||||
Net Assets Consist of: | ||||||||||||||||
Capital (par value and paid-in surplus)* | $ | 331,814 | $ | 548,317 | $ | 10,075 | $ | 97,122 | ||||||||
Undistributed net investment income* | 34 | 72 | 14 | 313 | ||||||||||||
Undistributed net realized loss from investment and foreign currency transactions* | (83,019) | (279,342) | (3,490) | (18,938) | ||||||||||||
Unrealized net appreciation of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 51,774 | 66,228 | 1,206 | 14,790 | ||||||||||||
Total Net Assets | $ | 300,603 | $ | 335,275 | $ | 7,805 | $ | 93,287 | ||||||||
Net Assets - Class A Shares | $ | 13,583 | $ | 8,326 | $ | 2,129 | $ | 4,653 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 1,033 | 644 | 276 | 494 | ||||||||||||
Net Asset Value Per Share(1) | $ | 13.14 | $ | 12.93 | $ | 7.72 | $ | 9.42 | ||||||||
Maximum Offering Price Per Share(2) | $ | 13.94 | $ | 13.72 | $ | 8.19 | $ | 9.99 | ||||||||
Net Assets - Class C Shares | $ | 6,617 | $ | 4,188 | $ | 2,086 | $ | 456 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 503 | 334 | 270 | 49 | ||||||||||||
Net Asset Value Per Share(1) | $ | 13.15 | $ | 12.52 | $ | 7.72 | $ | 9.38 | ||||||||
Net Assets - Class D Shares | $ | 157,247 | $ | N/A | $ | N/A | $ | N/A | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 11,970 | N/A | N/A | N/A | ||||||||||||
Net Asset Value Per Share | $ | 13.14 | $ | N/A | $ | N/A | $ | N/A | ||||||||
Net Assets - Class I Shares | $ | 52,385 | $ | 309,546 | $ | 1,478 | $ | 87,879 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 3,988 | 24,126 | 192 | 9,298 | ||||||||||||
Net Asset Value Per Share | $ | 13.14 | $ | 12.83 | $ | 7.69 | $ | 9.45 | ||||||||
Net Assets - Class S Shares | $ | 4,457 | $ | 13,177 | $ | 2,086 | $ | 259 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 339 | 1,022 | 270 | 27 | ||||||||||||
Net Asset Value Per Share | $ | 13.14 | $ | 12.90 | $ | 7.72 | $ | 9.42 | ||||||||
Net Assets - Class T Shares | $ | 66,314 | $ | 38 | $ | 26 | $ | 40 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 5,047 | 3 | 3 | 4 | ||||||||||||
Net Asset Value Per Share | $ | 13.14 | $ | 12.83 | $ | 7.71 | $ | 9.43 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Redemption price per share may be reduced for any applicable contingent deferred sales charge. | |
(2) | Maximum offering price is computed at 100/94.25 of net asset value. |
See Notes to Financial Statements.
50 | DECEMBER 31, 2010
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Statements of Operations
INTECH | INTECH | INTECH | INTECH | |||||||||||||
For the six-month period ended December 31, 2010 (unaudited) | Risk-Managed | Risk-Managed | Risk-Managed | Risk-Managed | ||||||||||||
(all numbers in thousands) | Core Fund | Growth Fund | International Fund | Value Fund | ||||||||||||
Investment Income: | ||||||||||||||||
Interest | $ | – | $ | – | $ | – | $ | – | ||||||||
Dividends | 2,853 | 2,976 | 65 | 1,025 | ||||||||||||
Dividends from affiliates | 1 | 2 | – | 1 | ||||||||||||
Foreign tax withheld | – | (1) | (2) | – | ||||||||||||
Total Investment Income | 2,854 | 2,977 | 63 | 1,026 | ||||||||||||
Expenses: | ||||||||||||||||
Advisory fees | 761 | 934 | 20 | 201 | ||||||||||||
Shareholder reports expense | 120 | 94 | 1 | 12 | ||||||||||||
Transfer agent fees and expenses | 181 | 33 | 2 | 26 | ||||||||||||
Registration fees | 57 | 47 | 35 | 49 | ||||||||||||
Custodian fees | 3 | 4 | 47 | 1 | ||||||||||||
Professional fees | 20 | 19 | 18 | 20 | ||||||||||||
Non-interested Trustees’ fees and expenses | 5 | 4 | – | 2 | ||||||||||||
Administrative services fees - Class D Shares | 89 | N/A | N/A | N/A | ||||||||||||
Administrative services fees - Class S Shares | 5 | 19 | 2 | – | ||||||||||||
Administrative services fees - Class T Shares | 79 | – | – | – | ||||||||||||
Distribution fees and shareholder servicing fees - Class A Shares | 16 | 13 | 3 | 5 | ||||||||||||
Distribution fees and shareholder servicing fees - Class C Shares | 33 | 21 | 10 | 2 | ||||||||||||
Distribution fees and shareholder servicing fees - Class S Shares | 5 | 19 | 2 | – | ||||||||||||
Administrative, networking and omnibus fees - Class A Shares | 2 | 3 | – | 1 | ||||||||||||
Administrative, networking and omnibus fees - Class C Shares | 5 | 17 | – | – | ||||||||||||
Administrative, networking and omnibus fees - Class I Shares | 15 | 1 | – | 7 | ||||||||||||
Other expenses | 10 | 16 | 7 | 8 | ||||||||||||
Total Expenses | 1,406 | 1,244 | 147 | 334 | ||||||||||||
Expense and Fee Offset | – | (1) | – | – | ||||||||||||
Net Expenses | 1,406 | 1,243 | 147 | 334 | ||||||||||||
Less: Excess Expense Reimbursement | – | (11) | (103) | (2) | ||||||||||||
Net Expenses after Expense Reimbursement | 1,406 | 1,232 | 44 | 332 | ||||||||||||
Net Investment Income | 1,448 | 1,745 | 19 | 694 | ||||||||||||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||||||||||||||
Net realized gain from investment and foreign currency transactions | 8,752 | 23,273 | 280 | 1,020 | ||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 49,487 | 53,250 | 1,358 | 13,605 | ||||||||||||
Net Gain on Investments | 58,239 | 76,523 | 1,638 | 14,625 | ||||||||||||
Net Increase in Net Assets Resulting from Operations | $ | 59,687 | $ | 78,268 | $ | 1,657 | $ | 15,319 |
See Notes to Financial Statements.
52 | DECEMBER 31, 2010
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Statements of Changes in Net Assets
For the six-month period ended December 31, 2010 (unaudited), the eight- or | ||||||||||||||||||||||||||||||||||||||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal year ended October | INTECH Risk-Managed | INTECH Risk-Managed | INTECH Risk-Managed | INTECH Risk-Managed | ||||||||||||||||||||||||||||||||||||||||||||
31, 2009 or July 31, 2009 | Core Fund | Growth Fund | International Fund | Value Fund | ||||||||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | ||||||||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||||||||||||||||||
Net investment income | $ | 1,448 | $ | 2,354 | $ | 4,162 | $ | 1,745 | $ | 7,196 | $ | 11,631 | $ | 19 | $ | 124 | $ | 174 | $ | 694 | $ | 1,019 | $ | 1,546 | ||||||||||||||||||||||||
Net realized gain/(loss) from investment and foreign currency transactions | 8,752 | 30,854 | (65,969) | 23,273 | 154,479 | (387,878) | 280 | 350 | (3,164) | 1,020 | 6,273 | (22,217) | ||||||||||||||||||||||||||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 49,487 | (24,138) | 81,333 | 53,250 | (64,786) | 59,718 | 1,358 | (692) | 817 | 13,605 | (2,440) | 7,995 | ||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Net Assets Resulting from Operations | 59,687 | 9,070 | 19,526 | 78,268 | 96,889 | (316,529) | 1,657 | (218) | (2,173) | 15,319 | 4,852 | (12,676) | ||||||||||||||||||||||||||||||||||||
Dividends and Distributions to Shareholders: | ||||||||||||||||||||||||||||||||||||||||||||||||
Net Investment Income* | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | (98) | (77) | – | (80) | (105) | (227) | (30) | (16) | (71) | (52) | (19) | (77) | ||||||||||||||||||||||||||||||||||||
Class C Shares | (6) | (16) | – | – | (9) | (10) | (30) | (15) | (57) | (3) | (1) | (8) | ||||||||||||||||||||||||||||||||||||
Class D Shares | (1,637) | – | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | (597) | (382) | – | (3,799) | (5,810) | (15,766) | (21) | (21) | (89) | (1,105) | (373) | (2,447) | ||||||||||||||||||||||||||||||||||||
Class S Shares | (31) | (28) | – | (98) | (78) | (293) | (30) | (16) | (63) | (2) | (1) | (8) | ||||||||||||||||||||||||||||||||||||
Class T Shares | (636) | (1,549) | (6,726) | (1) | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Net Realized Gain/(Loss) from Investment Transactions* | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class C Shares | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class D Shares | – | – | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class S Shares | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class T Shares | – | – | – | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Net Decrease from Dividends and Distributions | (3,005) | (2,052) | (6,726) | (3,978) | (6,002) | (16,296) | (111) | (68) | (280) | (1,162) | (394) | (2,540) | ||||||||||||||||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||||||||||||||||||
Shares Sold | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | 2,078 | 1,241 | 578 | 732 | 2,226 | 4,008 | – | 6 | 81 | 615 | 838 | 2,561 | ||||||||||||||||||||||||||||||||||||
Class C Shares | 112 | 237 | 264 | 52 | 302 | 626 | 2 | 9 | 2 | 95 | 49 | 45 | ||||||||||||||||||||||||||||||||||||
Class D Shares | 4,723 | 4,360 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | 4,209 | 16,077 | 4,786 | 16,680 | 72,041 | 182,131 | 117 | 384 | 463 | 9,440 | 10,476 | 19,227 | ||||||||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | N/A | N/A | 17 | N/A | N/A | N/A | N/A | N/A | 20 | ||||||||||||||||||||||||||||||||||||
Class S Shares | 289 | 882 | 217 | 839 | 1,941 | 7,801 | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class T Shares | 3,820 | 7,483 | 22,565 | 20 | 13 | 1 | 12 | 10 | 1 | – | 32 | 1 | ||||||||||||||||||||||||||||||||||||
Shares Issued in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||||||||||
Class D Shares | N/A | 143,369 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Shares Issued in Connection with Acquisition (Note 10) | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | N/A | N/A | 16,855 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class C Shares | N/A | N/A | 8,098 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | N/A | N/A | 47,224 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class S Shares | N/A | N/A | 4,376 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Redemption Fees | ||||||||||||||||||||||||||||||||||||||||||||||||
Class C Shares | N/A | N/A | N/A | – | – | – | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class D Shares | 1 | 2 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | – | – | – | 3 | 4 | 5 | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class S Shares | – | – | – | – | 2 | 4 | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class T Shares | – | 5 | 11 | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Reinvested Dividends and Distributions | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | 91 | 73 | – | 77 | 98 | 200 | 30 | 16 | 70 | 52 | 19 | 72 | ||||||||||||||||||||||||||||||||||||
Class C Shares | 2 | 7 | – | – | 5 | 5 | 30 | 15 | 56 | 2 | 1 | 8 | ||||||||||||||||||||||||||||||||||||
Class D Shares | 1,620 | – | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | 434 | 268 | – | 2,862 | 5,514 | 14,966 | 21 | 21 | 89 | 1,070 | 373 | 2,356 | ||||||||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 6 | ||||||||||||||||||||||||||||||||||||
Class S Shares | 31 | 27 | – | 97 | 78 | 292 | 29 | 16 | 63 | 2 | 1 | 7 | ||||||||||||||||||||||||||||||||||||
Class T Shares | 622 | 1,531 | 6,625 | – | – | – | – | – | – | – | – | – |
See footnotes at the end of the Statements.
See Notes to Financial Statements.
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Statements of Changes in Net Assets (continued)
For the six-month period ended December 31, 2010 (unaudited), the eight- or | ||||||||||||||||||||||||||||||||||||||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal year ended October | INTECH Risk-Managed | INTECH Risk-Managed | INTECH Risk-Managed | INTECH Risk-Managed | ||||||||||||||||||||||||||||||||||||||||||||
31, 2009 or July 31, 2009 | Core Fund | Growth Fund | International Fund | Value Fund | ||||||||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | ||||||||||||||||||||||||||||||||||||
Shares Repurchased | ||||||||||||||||||||||||||||||||||||||||||||||||
Class A Shares | (2,088) | (3,629) | (3,738) | (6,587) | (10,113) | (12,484) | (9) | (70) | (29) | (482) | (827) | (605) | ||||||||||||||||||||||||||||||||||||
Class C Shares | (1,303) | (1,959) | (1,465) | (652) | (1,652) | (2,295) | – | (11) | (1) | (40) | (18) | (29) | ||||||||||||||||||||||||||||||||||||
Class D Shares | (13,963) | (9,744) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Class I Shares | (12,999) | (12,651) | (11,908) | (157,404) | (592,968) | (309,349) | (131) | (1,586) | (147) | (2,032) | (8,563) | (9,925) | ||||||||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | N/A | N/A | (208)(5) | N/A | N/A | N/A | N/A | N/A | (433)(6) | ||||||||||||||||||||||||||||||||||||
Class S Shares | (601) | (1,717) | (1,920) | (6,620) | (8,027) | (40,543) | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Class T Shares | (9,539) | (37,360) | (58,072) | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||
Shares Reorganized in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||||||||||
Class T Shares | N/A | (143,369) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) from Capital Share Transactions | (22,461) | (34,867) | 34,496 | (149,901) | (530,536) | (154,823) | 101 | (1,190) | 648 | 8,722 | 2,381 | 13,311 | ||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Net Assets | 34,221 | (27,849) | 47,296 | (75,611) | (439,649) | (487,648) | 1,647 | (1,476) | (1,805) | 22,879 | 6,839 | (1,905) | ||||||||||||||||||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||||||||||||||||||
Beginning of period | 266,382 | 294,231 | 246,935 | 410,886 | 850,535 | 1,338,183 | 6,158 | 7,634 | 9,439 | 70,408 | 63,569 | 65,474 | ||||||||||||||||||||||||||||||||||||
End of period | $ | 300,603 | $ | 266,382 | $ | 294,231 | $ | 335,275 | $ | 410,886 | $ | 850,535 | $ | 7,805 | $ | 6,158 | $ | 7,634 | $ | 93,287 | $ | 70,408 | $ | 63,569 | ||||||||||||||||||||||||
Undistributed Net Investment Income* | $ | 34 | $ | 1,591 | $ | 1,290 | $ | 72 | $ | 2,305 | $ | 1,111 | $ | 14 | $ | 106 | $ | 36 | $ | 313 | $ | 781 | $ | 156 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from November 1, 2008 through October 31, 2009. | |
(3) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(4) | Period from August 1, 2008 through July 31, 2009. | |
(5) | A liquidation of Class R Shares occurred at the close of business of March 31, 2009. | |
(6) | A liquidation of Class R Shares occurred at the close of business of March 25, 2009. |
See Notes to Financial Statements.
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Financial Highlights
Class A Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eight-month fiscal period ended June 30, 2010 | Core Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.72 | $10.56 | $9.26 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .05 | .07 | .05 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.46 | .16 | 1.25 | |||||||||||
Total from Investment Operations | 2.51 | .23 | 1.30 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.09) | (.07) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.09) | (.07) | – | |||||||||||
Net Asset Value, End of Period | $13.14 | $10.72 | $10.56 | |||||||||||
Total Return** | 23.45% | 2.11% | 14.04% | |||||||||||
Net Assets, End of Period (in thousands) | $13,583 | $11,026 | $13,008 | |||||||||||
Average Net Assets for the Period (in thousands) | $12,428 | $12,844 | $14,686 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.09% | 1.06% | 1.10% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.09% | 1.06% | 1.08% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.93% | 0.85% | 1.20% | |||||||||||
Portfolio Turnover Rate*** | 100% | 120% | 111% |
Class A Shares
For a share outstanding during the six-month period ended | ||||||||||||||||||||||||||||||
December 31, 2010 (unaudited), the eleven-month fiscal | ||||||||||||||||||||||||||||||
period ended June 30, 2010 and each fiscal year or period | INTECH Risk-Managed Growth Fund | |||||||||||||||||||||||||||||
ended July 31 | 2010 | 2010(4) | 2009 | 2008 | 2007 | 2006 | 2005(5)(6) | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.52 | $9.80 | $12.88 | $14.45 | $12.81 | $13.32 | $12.56 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .19 | .14 | .14 | .09 | .06 | .06 | – | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.34 | .64 | (3.11) | (.94) | 1.62 | .08 | 1.64 | |||||||||||||||||||||||
Total from Investment Operations | 2.53 | .78 | (2.97) | (.85) | 1.68 | .14 | 1.64 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.12) | (.06) | (.11) | (.08) | (.04) | (.02) | – | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.64) | – | (.63) | (.88) | |||||||||||||||||||||||
Total Distributions and Other | (.12) | (.06) | (.11) | (.72) | (.04) | (.65) | (.88) | |||||||||||||||||||||||
Net Asset Value, End of Period | $12.93 | $10.52 | $9.80 | $12.88 | $14.45 | $12.81 | $13.32 | |||||||||||||||||||||||
Total Return** | 24.09% | 7.97% | (22.92)% | (6.54)% | 13.10% | 0.84% | 13.36% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $8,326 | $11,914 | $18,215 | $34,231 | $50,000 | $30,875 | $12,887 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $10,259 | $17,116 | $20,041 | $47,093 | $39,807 | $22,793 | $2,766 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.92% | 0.90% | 0.82% | 0.78% | 0.81% | 0.85% | 0.86% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.92% | 0.90% | 0.82% | 0.78% | 0.81% | 0.85% | 0.85% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.68% | 0.71% | 1.01% | 0.57% | 0.54% | 0.61% | 0.17% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 85% | 128% | 119% | 125% | 113% | 100% | 106% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(5) | Period from September 30, 2004 (inception date) through July 31, 2005. | |
(6) | Certain prior year amounts have been reclassified to conform with current year presentation. |
See Notes to Financial Statements.
58 | DECEMBER 31, 2010
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Class A Shares
For a share outstanding during the six-month | ||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed International Fund | |||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007(2) | |||||||||||||||||
Net Asset Value, Beginning of Period | $6.16 | $6.56 | $8.97 | $9.93 | $10.00 | |||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||
Net investment income | .02 | .13 | .16 | .20 | .08 | |||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.65 | (.47) | (2.31) | (1.01) | (.15) | |||||||||||||||||
Total from Investment Operations | 1.67 | (.34) | (2.15) | (.81) | (.07) | |||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | (.06) | (.26) | (.15) | – | |||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | |||||||||||||||||
Total Distributions and Other | (.11) | (.06) | (.26) | (.15) | – | |||||||||||||||||
Net Asset Value, End of Period | $7.72 | $6.16 | $6.56 | $8.97 | $9.93 | |||||||||||||||||
Total Return** | 27.16% | (5.32)% | (23.53)% | (8.35)% | (0.70)% | |||||||||||||||||
Net Assets, End of Period (in thousands) | $2,129 | $1,684 | $1,836 | $2,326 | $2,481 | |||||||||||||||||
Average Net Assets for the Period (in thousands) | $1,953 | $1,900 | $1,632 | $2,507 | $2,490 | |||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.16% | 0.74%(4) | 0.64%(4) | 0.91% | 0.91% | |||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.16% | 0.73%(4) | 0.64%(4) | 0.90% | 0.90% | |||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.61% | 1.87% | 2.62% | 1.92% | 3.20% | |||||||||||||||||
Portfolio Turnover Rate*** | 137% | 130% | 115% | 105% | 140% |
Class A Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Value Fund | |||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006(5) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.85 | $7.36 | $9.88 | $11.68 | $10.64 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .07 | .10 | .15 | .14 | .16 | .09 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.61 | .43 | (2.35) | (1.58) | 1.05 | .55 | ||||||||||||||||||||
Total from Investment Operations | 1.68 | .53 | (2.20) | (1.44) | 1.21 | .64 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | (.04) | (.32) | (.13) | (.15) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.23) | (.02) | – | ||||||||||||||||||||
Total Distributions and Other | (.11) | (.04) | (.32) | (.36) | (.17) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $9.42 | $7.85 | $7.36 | $9.88 | $11.68 | $10.64 | ||||||||||||||||||||
Total Return** | 21.37% | 7.21% | (22.01)% | (12.78)% | 11.38% | 6.40% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $4,653 | $3,694 | $3,440 | $1,032 | $538 | $266 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $4,331 | $3,815 | $1,762 | $680 | $414 | $256 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.06% | 1.01% | 0.74% | 0.85% | 0.85% | 0.85% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.06% | 1.01% | 0.74% | 0.85% | 0.85% | 0.85% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.49% | 1.26% | 2.28% | 2.08% | 1.64% | 1.48% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 88% | 101% | 100% | 78% | 71% | 98% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from May 2, 2007 (inception date) through July 31, 2007. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Pursuant to a contractual agreement, Janus waived certain fees and expenses during the period. The Ratio of Gross Expenses to Average Net Assets and Ratio of Net Expenses to Average Net Assets would have been 1.26% and 1.25%, respectively, in 2010 and 0.93% and 0.93%, respectively, in 2009 without the waiver of these fees and expenses. | |
(5) | Period from December 30, 2005 (inception date) through July 31, 2006. |
See Notes to Financial Statements.
Janus Risk-Managed Funds | 59
Table of Contents
Financial Highlights (continued)
Class C Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eight-month fiscal period ended June 30, 2010 | Core Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.71 | $10.54 | $9.26 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .01 | .03 | .02 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.44 | .16 | 1.26 | |||||||||||
Total from Investment Operations | 2.45 | .19 | 1.28 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.01) | (.02) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.01) | (.02) | – | |||||||||||
Net Asset Value, End of Period | $13.15 | $10.71 | $10.54 | |||||||||||
Total Return** | 22.89% | 1.82% | 13.82% | |||||||||||
Net Assets, End of Period (in thousands) | $6,617 | $6,452 | $7,938 | |||||||||||
Average Net Assets for the Period (in thousands) | $6,598 | $7,678 | $8,527 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.93% | 1.56% | 1.85% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.93% | 1.56% | 1.83% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.06% | 0.35% | 0.44% | |||||||||||
Portfolio Turnover Rate*** | 100% | 120% | 111% |
Class C Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Growth Fund | |||||||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(4) | 2009 | 2008 | 2007(5) | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.15 | $9.50 | $12.45 | $14.03 | $12.51 | $13.10 | $12.14 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income/(loss) | (.09) | (.14) | (.05) | (.11) | (.01) | – | .02 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.46 | .81 | (2.88) | (.83) | 1.53 | .04 | 1.82 | |||||||||||||||||||||||
Total from Investment Operations | 2.37 | .67 | (2.93) | (.94) | 1.52 | .04 | 1.84 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | – | (.02) | (.02) | – | – | – | – | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.64) | – | (.63) | (.88) | |||||||||||||||||||||||
Redemption fees | – | –(6) | – | – | – | – | – | |||||||||||||||||||||||
Total Distributions and Other | – | (.02) | (.02) | (.64) | – | (.63) | (.88) | |||||||||||||||||||||||
Net Asset Value, End of Period | $12.52 | $10.15 | $9.50 | $12.45 | $14.03 | $12.51 | $13.10 | |||||||||||||||||||||||
Total Return** | 23.35% | 7.05% | (23.53)% | (7.31)% | 12.15% | 0.11% | 15.44% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $4,188 | $3,928 | $4,921 | $8,767 | $15,250 | $12,131 | $10,170 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $4,090 | $4,571 | $5,469 | $12,982 | $14,549 | $10,135 | $6,173 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.91% | 1.93% | 1.62% | 1.60% | 1.59% | 1.60% | 1.60% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.91% | 1.93% | 1.62% | 1.60% | 1.59% | 1.60% | 1.60% | |||||||||||||||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (0.33)% | (0.32)% | 0.21% | (0.25)% | (0.22)% | (0.16)% | (0.39)% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 85% | 128% | 119% | 125% | 113% | 100% | 106% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(5) | Certain prior year amounts have been reclassified to conform with current year presentation. | |
(6) | Redemption fees aggregated less than $.01 on a per share basis. |
See Notes to Financial Statements.
60 | DECEMBER 31, 2010
Table of Contents
Class C Shares
For a share outstanding during the six-month | ||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed International Fund | |||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007(2) | |||||||||||||||||
Net Asset Value, Beginning of Period | $6.17 | $6.57 | $8.93 | $9.91 | $10.00 | |||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||
Net investment income | .01 | .13 | .16 | .13 | .06 | |||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.65 | (.47) | (2.30) | (1.01) | (.15) | |||||||||||||||||
Total from Investment Operations | 1.66 | (.34) | (2.14) | (.88) | (.09) | |||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | (.06) | (.22) | (.10) | – | |||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | |||||||||||||||||
Total Distributions and Other | (.11) | (.06) | (.22) | (.10) | – | |||||||||||||||||
Net Asset Value, End of Period | $7.72 | $6.17 | $6.57 | $8.93 | $9.91 | |||||||||||||||||
Total Return** | 26.95% | (5.31)% | (23.61)% | (9.03)% | (0.90)% | |||||||||||||||||
Net Assets, End of Period (in thousands) | $2,086 | $1,642 | $1,737 | $2,274 | $2,477 | |||||||||||||||||
Average Net Assets for the Period (in thousands) | $1,911 | $1,827 | $1,552 | $2,485 | $2,487 | |||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.44% | 0.73%(4) | 0.70%(4) | 1.66% | 1.66% | |||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.44% | 0.73%(4) | 0.69%(4) | 1.65% | 1.65% | |||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.32% | 1.88% | 2.56% | 1.17% | 2.45% | |||||||||||||||||
Portfolio Turnover Rate*** | 137% | 130% | 115% | 105% | 140% |
Class C Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Value Fund | |||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006(5) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.81 | $7.35 | $9.78 | $11.61 | $10.60 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .02 | .03 | .12 | .23 | .07 | .04 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.61 | .45 | (2.34) | (1.75) | 1.05 | .56 | ||||||||||||||||||||
Total from Investment Operations | 1.63 | .48 | (2.22) | (1.52) | 1.12 | .60 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.06) | (.02) | (.21) | (.08) | (.09) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.23) | (.02) | – | ||||||||||||||||||||
Total Distributions and Other | (.06) | (.02) | (.21) | (.31) | (.11) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $9.38 | $7.81 | $7.35 | $9.78 | $11.61 | $10.60 | ||||||||||||||||||||
Total Return** | 20.82% | 6.51% | (22.52)% | (13.49)% | 10.52% | 6.00% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $456 | $330 | $281 | $342 | $1,510 | $267 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $375 | $324 | $266 | $860 | $577 | $256 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.82% | 1.76% | 1.47% | 1.60% | 1.61% | 1.60% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.82% | 1.76% | 1.47% | 1.60% | 1.60% | 1.60% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.76% | 0.51% | 1.94% | 1.36% | 0.80% | 0.73% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 88% | 101% | 100% | 78% | 71% | 98% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from May 2, 2007 (inception date) through July 31, 2007. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Pursuant to a contractual agreement, Janus waived certain fees and expenses during the period. The Ratio of Gross Expenses to Average Net Assets and Ratio of Net Expenses to Average Net Assets would have been 2.00% and 2.00%, respectively, in 2010 and 1.68% and 1.68%, respectively, in 2009 without the waiver of these fees and expenses. | |
(5) | Period from December 30, 2005 (inception date) through July 31, 2006. |
See Notes to Financial Statements.
Janus Risk-Managed Funds | 61
Table of Contents
Financial Highlights (continued)
Class D Shares
For a share outstanding during the six-month | INTECH Risk- | |||||||||
period ended December 31, 2010 | Managed Core Fund | |||||||||
(unaudited) and the fiscal period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $10.74 | $10.95 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .07 | .05 | ||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.47 | (.26) | ||||||||
Total from Investment Operations | 2.54 | (.21) | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.14) | – | ||||||||
Distributions (from capital gains)* | – | – | ||||||||
Redemption fees | –(2) | –(2) | ||||||||
Total Distributions and Other | (.14) | – | ||||||||
Net Asset Value, End of Period | $13.14 | $10.74 | ||||||||
Total Return** | 23.64% | (1.92)% | ||||||||
Net Assets, End of Period (in thousands) | $157,247 | $135,712 | ||||||||
Average Net Assets for the Period (in thousands) | $146,218 | $150,392 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.95% | 0.61% | ||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.95% | 0.60% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.05% | 1.22% | ||||||||
Portfolio Turnover Rate*** | 100% | 120% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | Redemption fees aggregated less than $.01 on a per share basis. | |
(3) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
62 | DECEMBER 31, 2010
Table of Contents
Class I Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eight-month fiscal period ended June 30, 2010 | Core Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.75 | $10.57 | $9.26 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .09 | .11 | .05 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.45 | .16 | 1.26 | |||||||||||
Total from Investment Operations | 2.54 | .27 | 1.31 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.15) | (.09) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Redemption fees | –(3) | –(3) | – | |||||||||||
Total Distributions and Other | (.15) | (.09) | – | |||||||||||
Net Asset Value, End of Period | $13.14 | $10.75 | $10.57 | |||||||||||
Total Return** | 23.64% | 2.51% | 14.15% | |||||||||||
Net Assets, End of Period (in thousands) | $52,385 | $50,382 | $45,795 | |||||||||||
Average Net Assets for the Period (in thousands) | $52,096 | $51,959 | $49,319 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.83% | 0.53% | 0.80% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.83% | 0.53% | 0.78% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.15% | 1.37% | 1.49% | |||||||||||
Portfolio Turnover Rate*** | 100% | 120% | 111% |
Class I Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the | ||||||||||||||||||||||||||
eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Growth Fund | |||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(5) | 2009 | 2008 | 2007 | 2006(6) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.45 | $9.72 | $12.84 | $14.40 | $12.76 | $13.52 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .09 | .12 | .12 | .11 | .08 | .05 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.45 | .69 | (3.07) | (.93) | 1.63 | (.16) | ||||||||||||||||||||
Total from Investment Operations | 2.54 | .81 | (2.95) | (.82) | 1.71 | (.11) | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.16) | (.08) | (.17) | (.10) | (.07) | (.02) | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.64) | – | (.63) | ||||||||||||||||||||
Redemption fees | –(3) | –(3) | –(3) | – | –(3) | – | ||||||||||||||||||||
Total Distributions and Other | (.16) | (.08) | (.17) | (.74) | (.07) | (.65) | ||||||||||||||||||||
Net Asset Value, End of Period | $12.83 | $10.45 | $9.72 | $12.84 | $14.40 | $12.76 | ||||||||||||||||||||
Total Return** | 24.27% | 8.29% | (22.76)% | (6.33)% | 13.39% | (0.99)% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $309,546 | $379,401 | $807,347 | $1,224,054 | $1,223,851 | $245,807 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $340,556 | $768,204 | $857,115 | $1,288,020 | $981,873 | $99,407 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.62% | 0.61% | 0.55% | 0.53% | 0.56% | 0.60% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.62% | 0.61% | 0.55% | 0.53% | 0.56% | 0.60% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.98% | 1.00% | 1.30% | 0.79% | 0.77% | 0.83% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 85% | 128% | 119% | 125% | 113% | 100% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Redemption fees aggregated less than $.01 on a per share basis. | |
(4) | See Note 6 in Notes to Financial Statements. | |
(5) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(6) | Period from November 28, 2005 (inception date) through July 31, 2006. |
See Notes to Financial Statements.
Janus Risk-Managed Funds | 63
Table of Contents
Financial Highlights (continued)
Class I Shares
For a share outstanding during the six-month | ||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed International Fund | |||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007(2) | |||||||||||||||||
Net Asset Value, Beginning of Period | $6.14 | $6.55 | $8.98 | $9.93 | $10.00 | |||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||
Net investment income | .03 | .13 | .15 | .22 | .09 | |||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.63 | (.48) | (2.30) | (1.01) | (.16) | |||||||||||||||||
Total from Investment Operations | 1.66 | (.35) | (2.15) | (.79) | (.07) | |||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | (.06) | (.28) | (.16) | – | |||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | |||||||||||||||||
Redemption fees | – | –(3) | – | – | – | |||||||||||||||||
Total Distributions and Other | (.11) | (.06) | (.28) | (.16) | – | |||||||||||||||||
Net Asset Value, End of Period | $7.69 | $6.14 | $6.55 | $8.98 | $9.93 | |||||||||||||||||
Total Return** | 27.09% | (5.48)% | (23.56)% | (8.09)% | (0.70)% | |||||||||||||||||
Net Assets, End of Period (in thousands) | $1,478 | $1,180 | $2,327 | $2,571 | $2,484 | |||||||||||||||||
Average Net Assets for the Period (in thousands) | $1,331 | $2,223 | $1,935 | $2,694 | $2,491 | |||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.05% | 1.00% | 0.68% | 0.66% | 0.66% | |||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.05% | 1.00% | 0.68% | 0.65% | 0.65% | |||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.70% | 1.38% | 2.65% | 2.18% | 3.45% | |||||||||||||||||
Portfolio Turnover Rate*** | 137% | 130% | 115% | 105% | 140% |
Class I Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Value Fund | |||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006(5) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.89 | $7.37 | $9.91 | $11.70 | $10.66 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .07 | .11 | .18 | .22 | .20 | .08 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.62 | .45 | (2.38) | (1.64) | 1.04 | .58 | ||||||||||||||||||||
Total from Investment Operations | 1.69 | .56 | (2.20) | (1.42) | 1.24 | .66 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.13) | (.04) | (.34) | (.14) | (.18) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.23) | (.02) | – | ||||||||||||||||||||
Redemption fees | – | –(3) | –(3) | –(3) | – | – | ||||||||||||||||||||
Total Distributions and Other | (.13) | (.04) | (.34) | (.37) | (.20) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $9.45 | $7.89 | $7.37 | $9.91 | $11.70 | $10.66 | ||||||||||||||||||||
Total Return** | 21.41% | 7.62% | (21.96)% | (12.54)% | 11.58% | 6.60% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $87,879 | $66,137 | $59,647 | $63,472 | $47,593 | $18,723 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $74,554 | $69,502 | $53,614 | $57,513 | $31,496 | $14,266 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 0.81% | 0.75% | 0.61% | 0.60% | 0.60% | 0.61% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 0.81% | 0.75% | 0.61% | 0.60% | 0.60% | 0.60% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.75% | 1.53% | 2.79% | 2.34% | 1.87% | 1.70% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 88% | 101% | 100% | 78% | 71% | 98% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from May 2, 2007 (inception date) through July 31, 2007. | |
(3) | Redemption fees aggregated less than $.01 on a per share basis. | |
(4) | See Note 6 in Notes to Financial Statements. | |
(5) | Period from December 30, 2005 (inception date) through July 31, 2006. |
See Notes to Financial Statements.
64 | DECEMBER 31, 2010
Table of Contents
Class S Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eight-month fiscal period ended June 30, 2010 | Core Fund | |||||||||||||
and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $10.73 | $10.55 | $9.26 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .05 | .07 | .04 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.45 | .17 | 1.25 | |||||||||||
Total from Investment Operations | 2.50 | .24 | 1.29 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.09) | (.06) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Redemption fees | –(3) | –(3) | – | |||||||||||
Total Distributions and Other | (.09) | (.06) | – | |||||||||||
Net Asset Value, End of Period | $13.14 | $10.73 | $10.55 | |||||||||||
Total Return** | 23.31% | 2.26% | 13.93% | |||||||||||
Net Assets, End of Period (in thousands) | $4,457 | $3,888 | $4,558 | |||||||||||
Average Net Assets for the Period (in thousands) | $4,232 | $4,677 | $5,179 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.29% | 1.03% | 1.27% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.29% | 1.02% | 1.25% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.70% | 0.89% | 1.02% | |||||||||||
Portfolio Turnover Rate*** | 100% | 120% | 111% |
Class S Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Growth Fund | |||||||||||||||||||||||||||||
and each fiscal year ended July 31 | 2010 | 2010(5) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.48 | $9.77 | $12.81 | $14.36 | $12.75 | $13.28 | $12.24 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .29 | .20 | .33 | .11 | .04 | .03 | .01 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.23 | .56 | (3.30) | (.98) | 1.58 | .07 | 1.91 | |||||||||||||||||||||||
Total from Investment Operations | 2.52 | .76 | (2.97) | (.87) | 1.62 | .10 | 1.92 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.10) | (.05) | (.07) | (.04) | (.01) | – | – | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.64) | – | (.63) | (.88) | |||||||||||||||||||||||
Redemption fees | –(3) | –(3) | –(3) | –(3) | –(3) | –(3) | –(3) | |||||||||||||||||||||||
Total Distributions and Other | (.10) | (.05) | (.07) | (.68) | (.01) | (.63) | (.88) | |||||||||||||||||||||||
Net Asset Value, End of Period | $12.90 | $10.48 | $9.77 | $12.81 | $14.36 | $12.75 | $13.28 | |||||||||||||||||||||||
Total Return** | 24.00% | 7.73% | (23.09)% | (6.68)% | 12.72% | 0.59% | 15.98% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $13,177 | $15,629 | $20,051 | $70,963 | $154,057 | $121,473 | $74,744 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $15,434 | $18,507 | $40,058 | $117,236 | $151,536 | $97,158 | $56,612 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(4) | 1.12% | 1.12% | 1.04% | 1.02% | 1.05% | 1.10% | 1.10% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(4) | 1.12% | 1.12% | 1.04% | 1.02% | 1.05% | 1.10% | 1.10% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.48% | 0.49% | 0.77% | 0.36% | 0.31% | 0.35% | 0.12% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 85% | 128% | 119% | 125% | 113% | 100% | 106% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | Redemption fees aggregated less than $.01 on a per share basis. | |
(4) | See Note 6 in Notes to Financial Statements. | |
(5) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. |
See Notes to Financial Statements.
Janus Risk-Managed Funds | 65
Table of Contents
Financial Highlights (continued)
Class S Shares
For a share outstanding during the six-month | ||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed International Fund | |||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007(2) | |||||||||||||||||
Net Asset Value, Beginning of Period | $6.16 | $6.56 | $8.95 | $9.92 | $10.00 | |||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||
Net investment income | .02 | .13 | .16 | .18 | .07 | |||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.65 | (.47) | (2.30) | (1.02) | (.15) | |||||||||||||||||
Total from Investment Operations | 1.67 | (.34) | (2.14) | (.84) | (.08) | |||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | (.06) | (.25) | (.13) | – | |||||||||||||||||
Distributions (from capital gains)* | – | – | – | – | – | |||||||||||||||||
Total Distributions and Other | (.11) | (.06) | (.25) | (.13) | – | |||||||||||||||||
Net Asset Value, End of Period | $7.72 | $6.16 | $6.56 | $8.95 | $9.92 | |||||||||||||||||
Total Return** | 27.16% | (5.32)% | (23.54)% | (8.61)% | (0.80)% | |||||||||||||||||
Net Assets, End of Period (in thousands) | $2,086 | $1,642 | $1,733 | $2,268 | $2,480 | |||||||||||||||||
Average Net Assets for the Period (in thousands) | $1,911 | $1,831 | $1,551 | $2,477 | $2,489 | |||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.25% | 0.73%(4) | 0.65%(4) | 1.16% | 1.16% | |||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.25% | 0.72%(4) | 0.65%(4) | 1.15% | 1.15% | |||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.51% | 1.89% | 2.60% | 1.67% | 2.95% | |||||||||||||||||
Portfolio Turnover Rate*** | 137% | 130% | 115% | 105% | 140% |
Class S Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||
the eleven-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Value Fund | |||||||||||||||||||||||||
and each fiscal year or period ended July 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006(5) | ||||||||||||||||||||
Net Asset Value, Beginning of Period | $7.85 | $7.37 | $9.86 | $11.66 | $10.63 | $10.00 | ||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||
Net investment income | .06 | .08 | .17 | .20 | .17 | .07 | ||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.60 | .44 | (2.38) | (1.67) | 1.00 | .56 | ||||||||||||||||||||
Total from Investment Operations | 1.66 | .52 | (2.21) | (1.47) | 1.17 | .63 | ||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||
Dividends (from net investment income)* | (.09) | (.04) | (.28) | (.10) | (.12) | – | ||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (.23) | (.02) | – | ||||||||||||||||||||
Total Distributions and Other | (.09) | (.04) | (.28) | (.33) | (.14) | – | ||||||||||||||||||||
Net Asset Value, End of Period | $9.42 | $7.85 | $7.37 | $9.86 | $11.66 | $10.63 | ||||||||||||||||||||
Total Return** | 21.10% | 7.00% | (22.15)% | (12.98)% | 11.00% | 6.30% | ||||||||||||||||||||
Net Assets, End of Period (in thousands) | $259 | $214 | $200 | $257 | $295 | $266 | ||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $238 | $225 | $192 | $284 | $294 | $256 | ||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.27% | 1.26% | 0.97% | 1.10% | 1.10% | 1.10% | ||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.27% | 1.26% | 0.97% | 1.10% | 1.10% | 1.10% | ||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.28% | 1.02% | 2.43% | 1.84% | 1.43% | 1.23% | ||||||||||||||||||||
Portfolio Turnover Rate*** | 88% | 101% | 100% | 78% | 71% | 98% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from May 2, 2007 (inception date) through July 31, 2007. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Pursuant to a contractual agreement, Janus waived certain fees and expenses during the period. The Ratio of Gross Expenses to Average Net Assets and Ratio of Net Expenses to Average Net Assets would have been 1.51% and 1.50%, respectively, in 2010 and 1.18% and 1.18%, respectively, in 2009 without the waiver of these fees and expenses. | |
(5) | Period from December 30, 2005 (inception date) through July 31, 2006. |
See Notes to Financial Statements.
66 | DECEMBER 31, 2010
Table of Contents
Class T Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||
the eight-month fiscal period ended June 30, 2010 | INTECH Risk-Managed Core Fund | |||||||||||||||||||||||||||||
and each fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $10.74 | $10.56 | $10.21 | $17.38 | $16.46 | $15.28 | $13.98 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .07 | .12 | .18 | .24 | .20 | .12 | .12 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.46 | .14 | .46 | (5.75) | 1.71 | 1.96 | 1.89 | |||||||||||||||||||||||
Total from Investment Operations | 2.53 | .26 | .64 | (5.51) | 1.91 | 2.08 | 2.01 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.13) | (.08) | (.29) | (.24) | (.12) | (.13) | (.08) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | – | (1.42) | (.87) | (.77) | (.63) | |||||||||||||||||||||||
Redemption fees | –(2) | –(2) | –(2) | –(2) | –(2) | –(2) | –(2) | |||||||||||||||||||||||
Total Distributions and Other | (.13) | (.08) | (.29) | (1.66) | (.99) | (.90) | (.71) | |||||||||||||||||||||||
Net Asset Value, End of Period | $13.14 | $10.74 | $10.56 | $10.21 | $17.38 | $16.46 | $15.28 | |||||||||||||||||||||||
Total Return** | 23.53% | 2.39% | 6.70% | (34.82)% | 12.11% | 14.10% | 14.79% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $66,314 | $58,922 | $222,932 | $246,935 | $512,837 | $498,582 | $379,214 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $62,459 | $140,726 | $215,954 | $386,247 | $543,933 | $433,127 | $308,431 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.04% | 0.79% | 0.91% | 0.75% | 0.77% | 0.91% | 0.89% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.04% | 0.79% | 0.91% | 0.75% | 0.77% | 0.90% | 0.88% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.95% | 1.16% | 1.78% | 1.55% | 1.08% | 0.81% | 0.92% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 100% | 120% | 111% | 74% | 109% | 108% | 81% |
Class T Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eleven-month fiscal period ended June 30, 2010 | Growth Fund | |||||||||||||
and the fiscal period ended July 31, 2009 | 2010 | 2010(4) | 2009(5) | |||||||||||
Net Asset Value, Beginning of Period | $10.48 | $9.76 | $8.98 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .04 | .06 | .01 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.48 | .73 | .77 | |||||||||||
Total from Investment Operations | 2.52 | .79 | .78 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.17) | (.07) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.17) | (.07) | – | |||||||||||
Net Asset Value, End of Period | $12.83 | $10.48 | $9.76 | |||||||||||
Total Return** | 24.06% | 8.11% | 8.69% | |||||||||||
Net Assets, End of Period (in thousands) | $38 | $14 | $1 | |||||||||||
Average Net Assets for the Period (in thousands) | $22 | $10 | $1 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.82% | 0.85% | 0.86% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.82% | 0.85% | 0.85% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.64% | 0.67% | 0.72% | |||||||||||
Portfolio Turnover Rate*** | 85% | 128% | 119% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Redemption fees aggregated less than $.01 on a per share basis. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through July 31, 2009. |
See Notes to Financial Statements.
Janus Risk-Managed Funds | 67
Table of Contents
Financial Highlights (continued)
Class T Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eleven-month fiscal period ended June 30, 2010 | International Fund | |||||||||||||
and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $6.16 | $6.55 | $5.93 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | (.02) | .12 | – | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.68 | (.45) | .62 | |||||||||||
Total from Investment Operations | 1.66 | (.33) | .62 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.11) | (.06) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.11) | (.06) | – | |||||||||||
Net Asset Value, End of Period | $7.71 | $6.16 | $6.55 | |||||||||||
Total Return** | 27.00% | (5.17)% | 10.46% | |||||||||||
Net Assets, End of Period (in thousands) | $26 | $10 | $1 | |||||||||||
Average Net Assets for the Period (in thousands) | $17 | $8 | $1 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.22% | 0.32%(4) | 1.25% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.22% | 0.31%(4) | 1.25% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.36% | 2.47% | (0.35)% | |||||||||||
Portfolio Turnover Rate*** | 137% | 130% | 115% |
Class T Shares
For a share outstanding during the six-month | ||||||||||||||
period ended December 31, 2010 (unaudited), | INTECH Risk-Managed | |||||||||||||
the eleven-month fiscal period ended June 30, 2010 | Value Fund | |||||||||||||
and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $7.87 | $7.37 | $6.63 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .07 | .05 | .01 | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 1.61 | .49 | .73 | |||||||||||
Total from Investment Operations | 1.68 | .54 | .74 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.12) | (.04) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.12) | (.04) | – | |||||||||||
Net Asset Value, End of Period | $9.43 | $7.87 | $7.37 | |||||||||||
Total Return** | 21.32% | 7.31% | 11.16% | |||||||||||
Net Assets, End of Period (in thousands) | $40 | $33 | $1 | |||||||||||
Average Net Assets for the Period (in thousands) | $37 | $20 | $1 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.04% | 1.00% | 1.00% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.04% | 1.00% | 1.00% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 1.52% | 1.20% | 2.08% | |||||||||||
Portfolio Turnover Rate*** | 88% | 101% | 100% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Pursuant to a contractual agreement, Janus waived certain fees and expenses during the period. The Ratio of Gross Expenses to Average Net Assets and Ratio of Net Expenses to Average Net Assets would have been 1.26% and 1.25%, respectively, without the waiver of these fees and expenses. |
See Notes to Financial Statements.
68 | DECEMBER 31, 2010
Table of Contents
Notes to Schedules of Investments (unaudited)
Lipper International Funds | Funds that invest their assets in securities with primary trading markets outside of the United States. | |
Lipper Multi-Cap Core Funds | Funds that, by portfolio practice, invest in a variety of market capitalization ranges without concentrating more than 75% of their equity assets in any one market capitalization range over an extended period of time. Multi-cap funds typically have between 25% to 75% of their assets invested in companies with market capitalizations (on a three-year weighted basis) above 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. Multi-cap core funds have more latitude in the companies in which they invest. These funds typically have an average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index. | |
Lipper Multi-Cap Growth Funds | Funds that, by portfolio practice, invest in a variety of market capitalization ranges without concentrating more than 75% of their equity assets in any one market capitalization range over an extended period of time. Multi-cap funds typically have between 25% to 75% of their assets invested in companies with market capitalizations (on a three-year weighted basis) above 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. Multi-cap growth funds typically have an above-average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index. | |
Lipper Multi-Cap Value Funds | Funds that, by portfolio practice, invest in a variety of market capitalization ranges without concentrating 75% of their equity assets in any one market capitalization range over an extended period of time. Multi-cap funds typically have between 25% to 75% of their assets invested in companies with market capitalizations (on a three year weighted basis) above 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. Multi-cap value funds typically have a below-average price-to earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SuperComposite 1500 Index. | |
Morgan Stanley Capital International EAFE® Index | A free float-adjusted market capitalization weighted index designed to measure developed market equity performance. The MSCI EAFE® Index is composed of companies representative of the market structure of developed market countries. The index includes reinvestment of dividends, net of foreign withholding taxes. | |
Russell 1000® Growth Index | Measures the performance of those Russell 1000® Index companies with higher price-to-book ratios and higher forecasted growth values. | |
Russell 1000® Value Index | Measures the performance of those Russell 1000® Index companies with lower price-to-book ratios and lower forecasted growth values. | |
S&P 500® Index | The Standard & Poor’s (“S&P”) 500® Index is a commonly recognized, market-capitalization weighted index of 500 widely held equity securities, designed to measure broad U.S. Equity performance. | |
PLC | Public Limited Company | |
REIT | Real Estate Investment Trust | |
SDR | Swedish Depositary Receipt | |
U.S. Shares | Securities of foreign companies trading on an American Stock Exchange. |
* | Non-income producing security. |
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Notes to Schedules of Investments (unaudited) (continued)
The following is a summary of the inputs that were used to value the Funds’ investments in securities and other financial instruments as of December 31, 2010. See Notes to Financial Statements for more information.
Valuation Inputs Summary (as of December 31, 2010)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
INTECH Risk-Managed Core Fund | |||||||||||
Common Stock | $ | 299,679,759 | $ | – | $ | – | |||||
Money Market | – | 1,179,000 | – | ||||||||
Total Investments in Securities | $ | 299,679,759 | $ | 1,179,000 | $ | – | |||||
Investments in Securities: | |||||||||||
INTECH Risk-Managed Growth Fund | |||||||||||
Common Stock | $ | 333,962,670 | $ | – | $ | – | |||||
Total Investments in Securities | $ | 333,962,670 | $ | – | $ | – | |||||
Investments in Securities: | |||||||||||
INTECH Risk-Managed International Fund | |||||||||||
Common Stock | $ | 7,500,743 | $ | – | $ | – | |||||
Cellular Communications | 135,816 | 28,966 | – | ||||||||
Preferred Stock | – | 121,226 | – | ||||||||
Money Market | – | 149,000 | – | ||||||||
Total Investments in Securities | $ | 7,636,559 | $ | 299,192 | $ | – | |||||
Investments in Securities: | |||||||||||
INTECH Risk-Managed Value Fund | |||||||||||
Common Stock | $ | 92,718,767 | $ | – | $ | – | |||||
Money Market | – | 5,578,794 | – | ||||||||
Total Investments in Securities | $ | 92,718,767 | $ | 5,578,794 | $ | – | |||||
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Notes to Financial Statements (unaudited)
The following section describes the organization and significant accounting policies and provides more detailed information about the schedules and tables that appear throughout this report. In addition, the Notes to Financial Statements explain the methods used in preparing and presenting this report.
1. | Organization and Significant Accounting Policies |
INTECH Risk-Managed Core Fund, INTECH Risk-Managed Growth Fund, INTECH Risk-Managed International Fund and INTECH Risk-Managed Value Fund (individually, a “Fund” and collectively, the “Funds”) are series funds. The Funds are part of Janus Investment Fund (the “Trust”), which is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The financial statements include information for the six-month period ended December 31, 2010. The Trust offers forty funds which include multiple series of shares, with differing investment objectives and policies. The Funds invest primarily in equity securities. Each Fund in this report is classified as diversified, as defined in the 1940 Act.
Each Fund in this report offers multiple classes of shares in order to meet the needs of various types of investors. Each class represents an interest in the same portfolio of investments. Certain financial intermediaries may not offer all classes of shares.
Class A Shares and Class C Shares are generally offered through financial intermediary platforms including, but not limited to, traditional brokerage platforms, mutual fund wrap fee programs, bank trust platforms, and retirement platforms. The maximum purchase in Class C Shares is $500,000 for any single purchase.
Class D Shares for INTECH Risk-Managed Core Fund are generally no longer being made available to new investors who do not already have a direct account with the Janus funds. The Shares are available only to investors who held accounts directly with the Janus funds as of July 6, 2009 and to immediate family members or members of the same household of an eligible individual investor. The Shares are not offered through financial intermediaries.
Class I Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, and bank trust platforms, as well as certain retirement platforms. Class I Shares are also available to certain institutional investors including, but not limited to, corporations, certain retirement plans, public plans, and foundations/endowments.
Class S Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms and asset allocation, mutual fund wrap, or other discretionary or nondiscretionary fee-based investment advisory programs. In addition, Class S Shares may be available through certain financial intermediaries who have an agreement with Janus Capital Management LLC (“Janus Capital”) or its affiliates to offer Class S Shares on their supermarket platforms.
Class T Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, bank trust platforms, and certain retirement platforms. In addition, Class T Shares may be available through certain financial intermediaries who have an agreement with Janus Capital or its affiliates to offer Class T Shares on their supermarket platforms.
The following accounting policies have been followed by the Funds and are in conformity with accounting principles generally accepted in the United States of America within the investment management industry.
Investment Valuation
Securities are valued at the last sales price or the official closing price for securities traded on a principal securities exchange (U.S. or foreign) and on the NASDAQ National Market. Securities traded on over-the-counter (“OTC”) markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees. Short-term securities with maturities of 60 days or less may be valued at amortized cost, which approximates market value. Debt securities with a remaining maturity of greater than 60 days are valued in accordance with the evaluated bid price supplied by the pricing service. The evaluated bid price supplied by the pricing service is an evaluation that reflects such factors as security prices, yields, maturities and ratings. Short positions shall be valued in accordance with the same methodologies, except that in the event that a last sale price is not available, the latest ask price shall be used instead of a bid price. Foreign securities and currencies are converted to U.S. dollars using the applicable exchange rate in effect as of the daily close of the New York Stock Exchange (“NYSE”). When market quotations are not readily available or deemed unreliable, or events or circumstances that may affect the value of portfolio securities held by the Funds are identified between the closing of their principal markets and the time the net asset value (“NAV”) is determined, securities may be valued at fair value as determined in good faith under procedures established by and under the
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Notes to Financial Statements (unaudited) (continued)
supervision of the Funds’ Trustees. Circumstances in which fair value pricing may be utilized include, but are not limited to: (i) a significant event that may affect the securities of a single issuer, such as a merger, bankruptcy, or significant issuer specific development; (ii) an event that may affect an entire market, such as a natural disaster or significant governmental action; (iii) a nonsignificant event such as a market closing early or not opening, or a security trading halt; and (iv) pricing of a non-valued security and a restricted or non-public security. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. Restricted and illiquid securities are valued in accordance with procedures established by the Funds’ Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded as soon as the Trust is informed of the dividend, if such information is obtained subsequent to the ex-dividend date. Dividends from foreign securities may be subject to withholding taxes in foreign jurisdictions. Interest income is recorded on the accrual basis and includes amortization of premiums and accretion of discounts. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes. Income, as well as gains and losses, both realized and unrealized, are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets.
Expenses
Each Fund bears expenses incurred specifically on its behalf, as well as a portion of general expenses, which may be allocated pro rata to each Fund. Each class of shares bears expenses incurred specifically on its behalf and, in addition, each class bears a portion of general expenses, which are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets. Expenses directly attributable to a specific class of shares are charged against the operations of such class.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translations
The Funds do not isolate that portion of the results of operations resulting from the effect of changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held at the date of the financial statements. Net unrealized appreciation or depreciation of investments and foreign currency translations arise from changes in the value of assets and liabilities, including investments in securities held at the date of the financial statements, resulting from changes in the exchange rates and changes in market prices of securities held.
Currency gains and losses are also calculated on payables and receivables that are denominated in foreign currencies. The payables and receivables are generally related to foreign security transactions and income.
Foreign currency-denominated assets and forward currency contracts may involve more risks than domestic transactions, including currency risk, political and economic risk, regulatory risk and equity risk. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of foreign currencies relative to the U.S. dollar.
Dividend Distributions
The Funds generally declare and distribute dividends of net investment income and realized capital gains (if any) annually. The majority of dividends and capital gains distributions from the Funds may be automatically reinvested into additional shares of that Fund, based on the discretion of the shareholder.
The Funds may make certain investments in real estate investment trusts (“REITs”) which pay dividends to their shareholders based upon funds available from operations. It is quite common for these dividends to exceed the REITs’ taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of capital. If the Funds distribute such amounts, such distributions could constitute a return of capital to shareholders for federal income tax purposes.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial statements, as the Funds intend to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter
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M of the Internal Revenue Code applicable to regulated investment companies.
In accordance with the Financial Accounting Standards Board (“FASB”) guidance, the Funds adopted the provisions of “Income Taxes.” These provisions require an evaluation of tax positions taken (or expected to be taken) in the course of preparing a Fund’s tax returns to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense on the Statements of Operations.
These provisions require management of the Funds to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of and during the period ended December 31, 2010, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examinations in progress and are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Valuation Inputs Summary
In accordance with FASB guidance, the Funds utilize the “Fair Value Measurements” to define fair value, establish a framework for measuring fair value, and expand disclosure requirements regarding fair value measurements. The Fair Value Measurement Standard does not require new fair value measurements, but is applied to the extent that other accounting pronouncements require or permit fair value measurements. This standard emphasizes that fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. Various inputs are used in determining the value of the Funds’ investments defined pursuant to this standard. These inputs are summarized into three broad levels:
Level 1 – Quoted prices in active markets for identical securities.
Level 2 – Prices determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use in pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others.
Debt securities are valued in accordance with the evaluated bid price supplied by the pricing service and generally categorized as Level 2 in the hierarchy. Securities traded on OTC markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees and are categorized as Level 2 in the hierarchy. Short-term securities with maturities of 60 days or less are valued at amortized cost, which approximates market value and are categorized as Level 2 in the hierarchy. Other securities that are categorized as Level 2 in the hierarchy include, but are not limited to, preferred stocks, bank loans, American Depositary Receipts (ADRs), Global Depositary Receipts (GDRs), warrants, swaps, investments in mutual funds, OTC options, and forward contracts. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. These are generally categorized as Level 2 in the hierarchy.
Level 3 – Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the security and would be based on the best information available under the circumstances.
For restricted equity securities and private placements where observable inputs are limited, assumptions about market activity and risk are used in employing valuation techniques such as the market approach, the income approach, or the cost approach, as defined under the FASB Guidance. These are categorized as Level 3 in the hierarchy.
There have been no significant changes in valuation techniques used in valuing any such positions held by the Funds since the beginning of the fiscal year.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of inputs used as of December 31, 2010 to value the Funds’ investments
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Notes to Financial Statements (unaudited) (continued)
in securities and other financial instruments is included in the “Valuation Inputs Summary” and “Level 3 Valuation Reconciliation of Assets” (if applicable) in the Notes to Schedules of Investments.
In April 2009, FASB issued “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly,” which provides additional guidance for estimating fair value in accordance with Fair Value Measurements when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. Additionally, it amends the Fair Value Measurement Standard by expanding disclosure requirements for reporting entities surrounding the major categories of assets and liabilities carried at fair value. The required disclosures have been incorporated into the “Valuation Inputs Summary” in the Notes to Schedules of Investments. Management believes applying this guidance does not have a material impact on the financial statements.
The Funds adopted FASB Accounting Standards Update “Fair Value Measurements and Disclosures” (the “Update”). This Update applies to a Fund’s disclosures about transfers in and out of Level 1 and Level 2 of the fair value hierarchy and the reasons for the transfers. Disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy are summarized under the Level 2 and Level 3 categories listed above. There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period.
The Funds recognize transfers between the levels as of the beginning of the fiscal year.
2. | Derivative Instruments |
The Funds may invest in various types of derivatives. A derivative is a financial instrument whose performance is derived from the performance of another asset. The Funds may invest in derivative instruments including, but not limited to: futures contracts, put options, call options, options on future contracts, and other equity-linked derivatives. A summary of derivative activity is reflected in the tables at the end of this section.
The Funds may use derivative instruments for hedging (to offset risks associated with an investment, currency exposure, or market conditions) or for speculative (to seek to enhance returns) purposes. When the Funds invest in a derivative for speculative purposes, the Funds will be fully exposed to the risks of loss of that derivative, which may sometimes be greater than the cost of the derivative. The Funds may not use any derivative to gain exposure to an asset or class of assets prohibited by their investment restrictions from purchasing directly. The Funds’ ability to use derivative instruments may also be limited by tax considerations.
Investments in derivatives are generally subject to equity risks that may cause their prices to fluctuate over time. Investments in derivatives may not directly correlate with the price movements of the underlying instrument. As a result, the use of derivatives may expose the Funds to additional risks that they would not be subject to if they invested directly in the securities underlying those derivatives. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case. Derivatives can be volatile and may involve significant risks, including, but not limited to, counterparty risk, credit risk, currency risk, equity risk, index risk, interest rate risk, leverage risk, and liquidity risk.
Derivatives may generally be traded OTC or on an exchange. Derivatives traded OTC, such as structured notes, are agreements that are individually negotiated between parties and can be tailored to meet a purchaser’s needs. OTC derivatives are not guaranteed by a clearing agency and may be subject to increased credit risk.
In an effort to mitigate credit risk associated with derivatives traded OTC, the Funds may enter into collateral agreements with certain counterparties whereby, subject to certain minimum exposure requirements, a Fund may require the counterparty to post collateral if the Fund has a net aggregate unrealized gain on all OTC derivative contracts with a particular counterparty. There is no guarantee that counterparty exposure is reduced and these arrangements are dependent on Janus Capital’s ability to establish and maintain appropriate systems and trading.
In pursuit of their investment objectives, each Fund may seek to use derivatives to increase or decrease exposure to the following market risk factors:
• | Counterparty Risk – Counterparty risk is the risk that the counterparty or a third party will not fulfill its obligation to a Fund. | |
• | Credit Risk – Credit risk is the risk an issuer will be unable to make principal and interest payments when due, or will default on its obligations. | |
• | Currency Risk – Currency risk is the risk that changes in the exchange rate between currencies will adversely affect the value (in U.S. dollar terms) of an investment. | |
• | Equity Risk – Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market. |
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• | Index Risk – If the derivative is linked to the performance of an index, it will be subject to the risks associated with changes in that index. If the index changes, a Fund could receive lower interest payments or experience a reduction in the value of the derivative to below what the Fund paid. Certain indexed securities, including inverse securities (which move in an opposite direction to the index), may create leverage, to the extent that they increase or decrease in value at a rate that is a multiple of the changes in the applicable index. | |
• | Interest Rate Risk – Interest rate risk is the risk that the value of fixed-income securities will generally decline as prevailing interest rates rise, which may cause a Fund’s NAV to likewise decrease, and vice versa. | |
• | Leverage Risk – Leverage risk is the risk associated with certain types of leveraged investments or trading strategies pursuant to which relatively small market movements may result in large changes in the value of an investment. A Fund creates leverage by using borrowed capital to increase the amount invested, or investing in instruments, including derivatives, where the investment loss can exceed the original amount invested. Certain investments or trading strategies that involve leverage can result in losses that greatly exceed the amount originally invested. | |
• | Liquidity Risk – Liquidity risk is the risk that certain securities may be difficult or impossible to sell at the time that the seller would like or at the price that the seller believes the security is currently worth. |
Futures Contracts
A futures contract is an exchange-traded agreement to take or make delivery of an underlying asset at a specific time in the future for a specific predetermined negotiated price. The Funds may enter into futures contracts to gain exposure to the stock market pending investment of cash balances or to meet liquidity needs. The Funds are subject to interest rate risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in futures contracts. The Funds may also use such derivative instruments to hedge or protect from adverse movements in securities prices, currency rates or interest rates. The use of futures contracts may involve risks such as the possibility of illiquid markets or imperfect correlation between the values of the contracts and the underlying securities, or that the counterparty will fail to perform its obligations.
Futures contracts are marked-to-market daily, and the daily variation margin is recorded as a receivable or payable on the Statements of Assets and Liabilities (if applicable). When a contract is closed, a realized gain or loss is recorded as “Net realized gain/(loss) from futures contracts” on the Statements of Operations (if applicable), equal to the difference between the opening and closing value of the contract. Generally, futures contracts are marked-to-market (i.e., treated as realized and subject to distribution) for federal income tax purposes at fiscal year-end. Securities held by the Funds that are designated as collateral for market value on futures contracts are noted on the Schedules of Investments (if applicable). Such collateral is in the possession of the Funds’ custodian or with the counterparty broker.
With futures, there is minimal counterparty credit risk to the Funds since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Options Contracts
An options contract provides the purchaser with the right, but not the obligation, to buy (call option) or sell (put option) a financial instrument at an agreed upon price. The Funds may purchase or write covered and uncovered put and call options on futures contracts and on portfolio securities for hedging purposes or as a substitute for an investment. The Funds are subject to interest rate risk, liquidity risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in options contracts. The Funds may use options contracts to hedge against changes in interest rates, the values of equities, or foreign currencies. The Funds may utilize American-style and European-style options. An American-style option is an option contract that can be exercised at any time between the time of purchase and the option’s expiration date. A European-style option is an option contract that can only be exercised on the option’s expiration date. The Funds may also invest in long-term equity anticipation securities, which are long-term option contracts that can be maintained for a period of up to three years. The Funds generally invest in options to hedge against adverse movements in the value of portfolio holdings.
When an option is written, the Funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. In writing an option, the Funds bear the risk of an unfavorable change in the price of the security underlying the written option. Exercise of an option written by the Funds could result in the Funds buying or selling a security at a price different from the current market value.
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Notes to Financial Statements (unaudited) (continued)
When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option are adjusted by the amount of premium received or paid.
The Funds may also purchase and write exchange-listed and OTC put and call options on domestic securities indices, and on foreign securities indices listed on domestic and foreign securities exchanges. Options on securities indices are similar to options on securities except that (1) the expiration cycles of securities index options are monthly, while those of securities options are currently quarterly, and (2) the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a securities index gives the holder the right to receive a cash “exercise settlement amount” equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of exercise, multiplied by (b) a fixed “index multiplier.” Receipt of this cash amount will depend upon the closing level of the securities index upon which the option is based being greater than, in the case of a call, or less than, in the case of a put, the exercise price of the index and the exercise price of the option times a specified multiple. The writer of the option is obligated, in return for the premium received, to make delivery of this amount.
Options traded on an exchange are regulated and the terms of the options are standardized. Options traded OTC expose the Funds to counterparty risk in the event that the counterparty does not perform. This risk is mitigated by having a netting arrangement between the Funds and the counterparty and by having the counterparty post collateral to cover the Funds’ exposure to the counterparty.
Holdings of the Funds designated to cover outstanding written options are noted on the Schedules of Investments (if applicable). Options written are reported as a liability on the Statements of Assets and Liabilities as “Options written at value” (if applicable).
Realized gains and losses are reported as “Net realized gain/(loss) from options contracts” on the Statements of Operations (if applicable).
The risk in writing call options is that the Funds give up the opportunity for profit if the market price of the security increases and the options are exercised. The risk in writing put options is that the Funds may incur a loss if the market price of the security decreases and the options are exercised. The risk in buying options is that the Funds pay a premium whether or not the options are exercised. The use of such instruments may involve certain additional risks as a result of unanticipated movements in the market. A lack of correlation between the value of an instrument underlying an option and the asset being hedged, or unexpected adverse price movements, could render the Funds’ hedging strategy unsuccessful. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased or sold. There is no limit to the loss the Funds may recognize due to written call options.
In accordance with FASB guidance, the Funds adopted the provisions for “Derivatives and Hedging,” which require qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. There were no derivatives held by the Funds during the period ended December 31, 2010.
3. | Other investments and strategies |
Additional Investment Risk
Unforeseen events in both domestic and international equity and fixed-income markets have resulted, and may continue to result, in an unusually high degree of volatility in the markets, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. These events and the resulting market upheavals may have an adverse effect on the Funds, such as a decline in the value and liquidity of many securities held by the Funds, unusually high and unanticipated levels of redemptions, an increase in portfolio turnover, a decrease in NAV, and an increase in Fund expenses. Such unforeseen events may make it unusually difficult to identify both investment risks and opportunities and could limit or preclude each Fund’s ability to achieve its investment objective. The market’s behavior may at times be unpredictable. Therefore, it is important to understand that the value of your investment may fall, sometimes sharply, and you could lose money.
Further, the recent instability experienced in the financial markets has resulted in the U.S. Government and various other governmental and regulatory entities taking actions to address the financial crisis. These actions include, but are not limited to, the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in July 2010 which is expected to dramatically change the way in which the U.S. financial system is supervised and regulated. More specifically, the Dodd-Frank Act provides for widespread regulation of financial institutions, consumer financial products and services, broker-dealers, over-the-counter derivatives, investment advisers, credit rating agencies, and mortgage lending, which expands federal oversight in the financial sector
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and may affect the investment management industry as a whole. Given the broad scope, sweeping nature, and the fact that many provisions of the Dodd-Frank Act must be implemented through future rulemaking, the ultimate impact of the Dodd-Frank Act, and any resulting regulation, is not yet certain. As a result, there can be no assurance that these measures will not have an adverse effect on the value or marketability of securities held by a Fund, including potentially limiting or completely restricting the ability of the Fund to use a particular investment instrument as part of its investment strategy, increasing the costs of using these instruments, or possibly making them less effective in general. Furthermore, no assurance can be made that the U.S. Government or any U.S. regulatory entity (or other authority or regulatory entity) will not continue to take further legislative or regulatory action in response to the economic crisis or otherwise, and the effect of such actions, if taken, cannot be known.
Counterparties
Fund transactions involving a counterparty are subject to the risk that the counterparty or a third party will not fulfill its obligation to a Fund (“counterparty risk”). Counterparty risk may arise because of the counterparty’s financial condition (i.e., financial difficulties, bankruptcy, or insolvency), market activities and developments, or other reasons, whether foreseen or not. A counterparty’s inability to fulfill its obligation may result in significant financial loss to a Fund. A Fund may be unable to recover its investment from the counterparty or may obtain a limited recovery, and/or recovery may be delayed. The extent of a Fund’s exposure to counterparty risk in respect to financial assets approximates their carrying value as recorded on the Fund’s Statement of Assets and Liabilities.
A Fund may be exposed to counterparty risk through participation in various programs including, but not limited to, lending its securities to third parties, cash sweep arrangements whereby a Fund’s cash balance is invested in one or more types of cash management vehicles, as well as investments in, but not limited to, repurchase agreements, debt securities, and derivatives, including various types of swaps, futures and options. A Fund intends to enter into financial transactions with counterparties that Janus Capital believes to be creditworthy at the time of the transaction. There is always the risk that Janus Capital’s analysis of a counterparty’s creditworthiness is incorrect or may change due to market conditions. To the extent that a Fund focuses its transactions with a limited number of counterparties, it will have greater exposure to the risks associated with one or more counterparties.
Initial Public Offerings
The Funds may invest in initial public offerings (“IPOs”). IPOs and other investment techniques may have a magnified performance impact on a Fund with a small asset base. The Funds may not experience similar performance as their assets grow.
Interfund Lending
As permitted by the Securities and Exchange Commission (“SEC”), or the 1940 Act and rules promulgated thereunder, the Funds may be party to interfund lending agreements between the Funds and other Janus Capital sponsored mutual funds and certain pooled investment vehicles, which permit them to borrow or lend cash at a rate beneficial to both the borrowing and lending funds. Outstanding borrowings from all sources totaling 10% or more of the borrowing Fund’s total assets must be collateralized at 102% of the outstanding principal value of the loan; loans of less than 10% may be unsecured.
Restricted Security Transactions
Restricted securities held by the Funds may not be sold except in exempt transactions or in a public offering registered under the Securities Act of 1933, as amended. The risk of investing in such securities is generally greater than the risk of investing in the securities of widely held, publicly traded companies. Lack of a secondary market and resale restrictions may result in the inability of the Funds to sell a security at a fair price and may substantially delay the sale of the security. In addition, these securities may exhibit greater price volatility than securities for which secondary markets exist.
Securities Lending
Under procedures adopted by the Trustees, the Funds may seek to earn additional income through lending their securities to certain qualified broker-dealers and institutions on a short-term or long-term basis. The Funds may lend portfolio securities on a short-term or long-term basis, in an amount equal to up to 1/3 of their total assets as determined at the time of the loan origination. When the Funds lend their securities, they receive collateral (including cash collateral), at least equal to the value of securities loaned. The Funds may earn income by investing this collateral in one or more affiliated or non-affiliated cash management vehicles. It is also possible that, due to a decline in the value of a cash management vehicle, the Funds may lose money. There is also the risk that when portfolio securities are lent, the securities may not be returned on a timely basis, and the Funds may experience delays and costs in recovering the security or gaining access to the collateral provided to the Funds to collateralize the loan. If the Funds are unable to recover a security on loan, the Funds may use the collateral to
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Notes to Financial Statements (unaudited) (continued)
purchase replacement securities in the market. There is a risk that the value of the collateral could decrease below the cost of the replacement security by the time the replacement investment is made, resulting in a loss to the Funds. Janus Capital intends to manage the cash collateral in an affiliated cash management vehicle and will receive an investment advisory fee for managing such assets.
The borrower pays fees at the Funds’ direction to Deutsche Bank AG (the “Lending Agent”). The Lending Agent may retain a portion of the interest earned on the cash collateral invested. The cash collateral invested by the Lending Agent is disclosed on the Schedules of Investments (if applicable). The lending fees and the Funds’ portion of the interest income earned on cash collateral are included on the Statements of Operations (if applicable).
The Funds did not have any securities on loan during the period.
4. | Investment Advisory Agreements and Other Transactions with Affiliates |
Each Fund pays Janus Capital an investment advisory fee which is calculated daily and paid monthly. The following table reflects INTECH Risk-Managed Core Fund’s “base” fee rate prior to any performance adjustment and certain Funds’ contractual investment advisory fee rate (expressed as an annual rate).
Contractual | ||||||||
Investment | ||||||||
Advisory Fee/ | ||||||||
Average Daily Net | Base Fee (%) | |||||||
Fund | Assets of the Fund | (annual rate) | ||||||
INTECH Risk-Managed Core Fund | N/A | 0.50 | ||||||
INTECH Risk-Managed Growth Fund | All Asset Levels | 0.50 | ||||||
INTECH Risk-Managed International Fund | All Asset Levels | 0.55 | ||||||
INTECH Risk-Managed Value Fund | All Asset Levels | 0.50 | ||||||
For INTECH Risk-Managed Core Fund, the investment advisory fee rate is determined by calculating a base fee and applying a performance adjustment. The base fee rate is the same as the contractual investment advisory fee rate shown in the table above. The performance adjustment either increases or decreases the base fee depending on how well the Fund has performed relative to its benchmark index, as shown below:
Only the base fee rate applied until January 2007 for INTECH Risk-Managed Core Fund, at which time the calculation of the performance adjustment applies as follows:
Investment Advisory Fee = Base Fee Rate +/- Performance Adjustment
The investment advisory fee rate paid to Janus Capital by INTECH Risk-Managed Core Fund consists of two components: (1) a base fee calculated by applying the contractual fixed rate of the advisory fee to the Fund’s average daily net assets during the previous month (“Base Fee Rate”), plus or minus (2) a performance-fee adjustment (“Performance Adjustment”) calculated by applying a variable rate of up to 0.15% (positive or negative) to the Fund’s average daily net assets during the applicable performance measurement period. The performance measurement period generally is the previous 36 months, although no Performance Adjustment is made until the performance-based fee structure has been in effect for at least 12 months and, accordingly, only the Fund’s Base Fee Rate applies for the initial 12 months. When the performance-based fee structure has been in effect for at least 12 months, but less than 36 months, the performance measurement period will be equal to the time that has elapsed since the performance-based fee structure took effect. As noted above, any applicable Performance Adjustments began January 2007 for the Fund.
No Performance Adjustment is applied unless the difference between the Fund’s investment performance and the cumulative investment record of the Fund’s benchmark index is 0.50% or greater (positive or negative) during the applicable performance measurement period. The Base Fee Rate is subject to an upward or downward performance adjustment for every full 0.50% increment by which the Fund outperforms or underperforms its benchmark index. Because the Performance Adjustment is tied to the Fund’s performance relative to its benchmark index (and not its absolute performance), the Performance Adjustment could increase Janus Capital’s fee even if the Fund’s Shares lose value during the performance measurement period and could decrease Janus Capital’s fee even if the Fund’s Shares increase in value during the performance measurement period. For purposes of computing the Base Fee Rate and the Performance Adjustment, net assets are averaged over different periods (average daily net assets during the previous month for the Base Fee Rate, versus average daily net assets during the performance measurement period for the Performance Adjustment). Performance of a Fund is calculated net of expenses, whereas the Fund’s benchmark index does not have any fees or expenses. Reinvestment of dividends and distributions is included in calculating both the performance of the Fund and the Fund’s benchmark index. The Base Fee Rate is calculated
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and accrued daily. The Performance Adjustment is calculated monthly in arrears and is accrued throughout the month. The investment fee is paid monthly in arrears. Under extreme circumstances involving underperformance by a rapidly shrinking Fund, the dollar amount of the Performance Adjustment could be more than the dollar amount of the Base Fee Rate. In such circumstances, Janus Capital would reimburse the Fund.
The application of an expense limit, if any, will have a positive effect upon the Fund’s performance and may result in an increase in the Performance Adjustment. It is possible that the cumulative dollar amount of additional compensation ultimately payable to Janus Capital may, under some circumstances, exceed the cumulative dollar amount of management fees waived by Janus Capital.
The investment performance of the Fund’s Class A Shares (waiving the upfront sales load) for the performance measurement period is used to calculate the Performance Adjustment. For performance measurement periods prior to July 6, 2009, INTECH Risk-Managed Core Fund calculated its Performance Adjustment by comparing the performance of Class T Shares (formerly named Class J Shares) against the investment record of its benchmark index. For periods beginning July 6, 2009, the investment performance of the Fund’s load-waived Class A Shares for the performance measurement period is used to calculate the Performance Adjustment. Because the Performance Adjustment is based on a rolling 36-month performance measurement period, calculations based solely on the performance of the Fund’s load-waived Class A Shares will not be fully implemented for 36 months after July 6, 2009. During this transition period, the Fund’s performance will be compared to a blended investment performance record that includes the Fund’s Class T Shares (formerly named Class J Shares) performance (the prior share class used for performance calculations) for the portion of the performance measurement period prior to July 6, 2009, and the Fund’s load-waived Class A Shares for the remainder of the period. At the conclusion of the transition period, the Fund’s Class T Shares will be eliminated from the Performance Adjustment calculation, and the calculation will be based solely upon the Fund’s load-waived Class A Shares. After Janus Capital determines whether the Fund’s performance was above or below its benchmark index by comparing the investment performance of the Fund’s load-waived Class A Shares, or Class T Shares (formerly named Class J Shares) as the case may be, against the cumulative investment record of the Fund’s benchmark index, Janus Capital applies the same Performance Adjustment (positive or negative) across each other class of shares of the Fund, as applicable.
It is not possible to predict the effect of the Performance Adjustment on future overall compensation to Janus Capital since it depends on the performance of INTECH Risk-Managed Core Fund relative to the record of the Fund’s benchmark index and future changes to the size of INTECH Risk-Managed Core Fund.
INTECH Risk-Managed Core Fund’s prospectuses and statement of additional information contain additional information about performance-based fees. The amount shown as advisory fees on the Statements of Operations reflects the Base Fee Rate plus/minus any Performance Adjustment.
During the period ended December 31, 2010, INTECH Risk-Managed Core Fund recorded a Performance Adjustment as indicated in the table below:
Performance | |||||
Fund | Fee | ||||
INTECH Risk-Managed Core Fund | $ | 44,649 | |||
INTECH Investment Management LLC (“INTECH”) serves as subadviser to each Fund. Janus Capital owns approximately 92% of INTECH.
Janus Capital pays INTECH a subadvisory fee rate equal to 50% of the investment advisory fee paid by the Funds to Janus Capital (calculated after any applicable performance fee adjustment for INTECH Risk-Managed Core Fund, and after any fee waivers, and expense reimbursements for INTECH Risk-Managed International Fund and INTECH Risk-Managed Value Fund). The subadvisory fee paid by Janus Capital to INTECH on behalf of INTECH Risk-Managed Core Fund adjusts up or down based on the Fund’s performance relative to its benchmark index over the performance measurement period.
Janus Services LLC (“Janus Services”), a wholly-owned subsidiary of Janus Capital, is the Funds’ transfer agent. In addition, Janus Services provides or arranges for the provision of certain other administrative services including, but not limited to, recordkeeping, accounting, order processing, and other shareholder services for the Funds.
Class D Shares of INTECH Risk-Managed Core Fund pays an annual administrative services fee of 0.12% of net assets. These administrative services fees are paid by the Shares of the Fund for shareholder services provided by Janus Services.
Janus Services receives an administrative services fee at an annual rate of 0.25% of the average daily net assets of Class S Shares and Class T Shares of the Funds for providing or procuring administrative services to investors in Class S Shares and Class T Shares of the Funds. Janus Services expects to use all or a significant portion of this
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Notes to Financial Statements (unaudited) (continued)
fee to compensate retirement plan service providers, broker-dealers, bank trust departments, financial advisors, and other financial intermediaries for providing these services. Services provided by these financial intermediaries may include, but are not limited to, recordkeeping, subaccounting, order processing, providing periodic statements, forwarding prospectuses, shareholder reports, and other materials to existing customers and other administrative services. Order processing includes the submission of transactions through the National Securities Clearing Corporation (“NSCC”) or similar systems, or those processed on a manual basis with Janus. Janus Services or its affiliates may also pay fees for services provided by intermediaries to the extent the fees charged by intermediaries exceed the 0.25% of net assets charged to Class S Shares and Class T Shares of each Fund.
Certain, but not all, intermediaries may charge administrative fees to investors in Class A, Class C, and Class I Shares for administrative services provided on behalf of such investors. These administrative fees are paid by the Class A Shares, Class C Shares, and Class I Shares of the Funds to Janus Services, which uses such fees to reimburse intermediaries. Janus Services may negotiate the level, structure, and/or terms of the administrative fees with intermediaries requiring such fees on behalf of the Funds. Janus Capital and its affiliates benefit from an increase in assets that may result from such relationships.
Janus Distributors LLC (“Janus Distributors”), a wholly-owned subsidiary of Janus Capital, is the distributor of the Funds. The Funds have adopted a Distribution and Shareholder Servicing Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Funds at an annual rate, as determined from time to time by the Board of Trustees, of up to 0.25% of the Class A Shares average daily net assets, of up to 1.00% of the Class C Shares average daily net assets, and of up to 0.25% of the Class S Shares average daily net assets. Payments under the Plan are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder service expenses actually incurred by the Funds. If any of a Fund’s actual distribution and shareholder service expenses incurred during a calendar year are less than the payments made during a calendar year, the Fund will be refunded for the difference. Refunds, if any, are included in the “Distribution fees and shareholder servicing fees” in the Statements of Operations.
Janus Capital has agreed to reimburse the Funds until at least November 1, 2011 by the amount, if any, that such Fund’s normal operating expenses in any fiscal year, including the investment advisory fee, but excluding any performance adjustments to management fees, if applicable, class-specific distribution and shareholder servicing fees applicable to Class A Shares, Class C Shares, and Class S Shares, the administrative services fees payable pursuant to the Transfer Agency Agreement applicable to Class D Shares, Class S Shares, and Class T Shares, brokerage commissions, interest, dividends, taxes and extraordinary expenses (including, but not limited to, acquired fund fees and expenses), exceed the annual rates noted below. If applicable, amounts reimbursed to the Funds by Janus Capital are disclosed as “Excess Expense Reimbursement” on the Statements of Operations.
Expense | |||||
Fund | Limit (%) | ||||
INTECH Risk-Managed Core Fund | 0.89 | ||||
INTECH Risk-Managed Growth Fund | 0.90 | ||||
INTECH Risk-Managed International Fund | 1.00 | ||||
INTECH Risk-Managed Value Fund | 0.75 | ||||
The Board of Trustees has adopted a deferred compensation plan (the “Deferred Plan”) for independent Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Funds. All deferred fees are credited to an account established in the name of the Trustees. The amounts credited to the account then increase or decrease, as the case may be, in accordance with the performance of one or more of the Janus funds that are selected by the Trustees. The account balance continues to fluctuate in accordance with the performance of the selected fund or funds until final payment of all amounts are credited to the account. The fluctuation of the account balance is recorded by the Funds as unrealized appreciation/(depreciation) and is shown as of December 31, 2010 on the Statements of Assets and Liabilities as an asset, “Non-interested Trustees’ deferred compensation,” and a liability, “Non-interested Trustees’ deferred compensation fees.” Additionally, the recorded unrealized appreciation/(depreciation) is included in “Unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” on the Statements of Assets and Liabilities. Deferred compensation expenses for the period ended December 31, 2010 are included in “Non-interested Trustees’ fees and expenses” on the Statements of Operations. Trustees are allowed to change their designation of mutual funds from time to time. Amounts will be deferred until distributed in accordance with the Deferred Plan. No deferred fees were distributed to any Trustee under the Deferred Plan during the period ended December 31, 2010.
For the period ended December 31, 2010, Janus Capital assumed $28,267 of legal, consulting and Trustee costs
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and fees incurred by the funds in the Trust and Janus Aspen Series together with the Trust (the “Portfolios”), in connection with the regulatory and civil litigation matters discussed in Note 11. These non-recurring costs were allocated to all Portfolios based on the Portfolios’ respective net assets as of July 31, 2004. Unless noted otherwise in the financial highlights, the effect of these non-recurring costs assumed by Janus Capital are included in the ratio of gross expenses to average net assets and were less than 0.01%. No fees were allocated to the Portfolios that commenced operations after July 31, 2004. Additionally, all future non-recurring costs will be allocated to the Portfolios based on the Portfolios’ respective net assets on July 31, 2004. These “Non-recurring costs” and “Costs assumed by Janus Capital” are shown on the Statements of Operations.
Certain officers of the Funds may also be officers and/or directors of Janus Capital. Such officers receive no compensation from the Funds, except for the Funds’ Chief Compliance Officer. The Funds reimburse Janus Capital for a portion of the compensation paid to the Chief Compliance Officer and certain compliance staff of the Trust. Total compensation of $266,383 was paid by the Trust during the period ended December 31, 2010. Each Fund’s portion is reported as part of “Other Expenses” on the Statements of Operations.
Class A Shares include a 5.75% upfront sales charge of the offering price of the Funds. The sales charge is allocated between Janus Distributors and financial intermediaries. During the period ended December 31, 2010, Janus Distributors retained the following upfront sales charges:
Upfront | |||||
Fund (Class A Shares) | Sales Charge | ||||
INTECH Risk-Managed Core Fund | $ | 2,139 | |||
INTECH Risk-Managed Growth Fund | 7 | ||||
INTECH Risk-Managed Value Fund | 32 | ||||
A contingent deferred sales charge of 1.00% will be deducted with respect to Class A Shares purchased without a sales load and redeemed within 12 months of purchase, unless waived, as discussed in the Prospectus. Any applicable CDSC will be 1.00% of the lesser of the original purchase price or the value of the redemption of the Class A Shares redeemed. There were no contingent deferred sales charges paid by redeeming shareholders of Class A Shares during the period ended December 31, 2010.
Class C Shares include a 1.00% contingent deferred sales charge paid by redeeming shareholders to Janus Distributors. The contingent deferred sales charge applies to shares redeemed within 12 months of purchase. The redemption price may differ from the net asset value per share. During the period ended December 31, 2010, redeeming shareholders of Class C Shares paid the following contingent deferred sales charge.
Contingent Deferred | |||||
Fund (Class C Shares) | Sales Charge | ||||
INTECH Risk-Managed Core Fund | $ | 74 | |||
A 2.00% redemption fee may be imposed on Class D Shares, Class I Shares, Class S Shares, and Class T Shares of the Funds, as applicable, held for 90 days or less. This fee is paid to the Funds rather than Janus Capital, and is designed to deter excessive short-term trading and to offset the brokerage commissions, market impact, and other costs associated with changes in the Funds’ asset levels and cash flow due to short-term money movements in and out of the Funds. The redemption fee is accounted for as an addition to Paid-in Capital.
Total redemption fees received by the Funds for the period ended December 31, 2010 are indicated in the table below:
Fund | Redemption Fee | ||||
INTECH Risk-Managed Core Fund | $ | 1,379 | |||
INTECH Risk-Managed Growth Fund | 2,801 | ||||
The Funds’ expenses may be reduced by expense offsets from an unaffiliated custodian and/or transfer agent. Such credits or offsets are included in “Expense and Fee Offset” on the Statements of Operations (if applicable). The transfer agent fee offsets received during the period reduce “Transfer agent fees and expenses” on the Statements of Operations (if applicable). Custodian offsets received reduce “Custodian fees” on the Statements of Operations (if applicable). The Funds could have employed the assets used by the custodian and/or transfer agent to produce income if they had not entered into an expense offset arrangement.
Pursuant to the terms and conditions of an SEC exemptive order and the provisions of the 1940 Act, the Funds may participate in an affiliated or non-affiliated cash sweep program. In the cash sweep program, uninvested cash balances of the Funds may be used to purchase shares of affiliated or non-affiliated money market funds or cash management pooled investment vehicles. The Funds are eligible to participate in the cash sweep program (the “Investing Funds”). Janus Cash Liquidity Fund LLC is an affiliated unregistered cash management pooled investment vehicle that invests primarily in highly-rated short-term fixed-income securities. Janus Cash Liquidity Fund LLC currently maintains a NAV of $1.00 per share and distributes income daily in a manner consistent with a registered 2a-7 product. There are no restrictions on the Funds’ ability to withdraw investments from Janus Cash Liquidity Fund LLC at will,
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Notes to Financial Statements (unaudited) (continued)
and there are no unfunded capital commitments due from the Funds to Janus Cash Liquidity Fund LLC. As adviser, Janus Capital has an inherent conflict of interest because of its fiduciary duties to the affiliated cash management pooled investment vehicles and the Investing Funds.
During the period ended December 31, 2010, the following Funds recorded distributions from affiliated investment companies as affiliated dividend income, and had the following affiliated purchases and sales:
Purchases | Sales | Dividend | Value | |||||||||||
Shares/Cost | Shares/Cost | Income | at 12/31/10 | |||||||||||
Janus Cash Liquidity Fund LLC | ||||||||||||||
INTECH Risk-Managed Core Fund | $ | 16,170,315 | $ | (15,440,315) | $ | 968 | $ | 1,179,000 | ||||||
INTECH Risk-Managed Growth Fund | 44,145,178 | (44,145,178) | 1,870 | – | ||||||||||
INTECH Risk-Managed International Fund | 920,041 | (829,041) | 69 | 149,000 | ||||||||||
INTECH Risk-Managed Value Fund | 8,661,575 | (3,565,000) | 774 | 5,578,794 | ||||||||||
$ | 69,897,109 | $ | (63,979,534) | $ | 3,681 | $ | 6,906,794 | |||||||
Janus Capital or an affiliate invested and/or redeemed initial seed capital during the period ended December 31, 2010, as indicated in the following table.
Seed Capital | Date of | Date of | Seed Capital | |||||||||||||||||
Fund | at 6/30/10 | Purchases | Purchases | Redemptions | Redemption | at 12/31/10 | ||||||||||||||
INTECH Risk-Managed Growth Fund - Class T Shares | $ | 11,000 | $ | – | – | $ | – | – | $ | 11,000 | ||||||||||
INTECH Risk-Managed International Fund - Class A Shares | 2,500,000 | – | – | – | – | 2,500,000 | ||||||||||||||
INTECH Risk-Managed International Fund - Class C Shares | 2,500,000 | – | – | – | – | 2,500,000 | ||||||||||||||
INTECH Risk-Managed International Fund - Class I Shares | 686,890 | – | – | – | – | 686,890 | ||||||||||||||
INTECH Risk-Managed International Fund - Class S Shares | 2,500,000 | – | – | – | – | 2,500,000 | ||||||||||||||
INTECH Risk-Managed International Fund - Class T Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
INTECH Risk-Managed Value Fund - Class C Shares | 250,000 | – | – | – | – | 250,000 | ||||||||||||||
INTECH Risk-Managed Value Fund - Class S Shares | 250,000 | – | – | – | – | 250,000 | ||||||||||||||
INTECH Risk-Managed Value Fund - Class T Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
5. | Federal Income Tax |
Income and capital gains distributions are determined in accordance with income tax regulations that may differ from accounting principles generally accepted in the United States of America. These differences are due to differing treatments for items such as net short-term gains, deferral of wash sale losses, foreign currency transactions, net investment losses and capital loss carryovers.
The Funds have elected to treat gains and losses on forward foreign currency contracts as capital gains and losses, if applicable. Other foreign currency gains and losses on debt instruments are treated as ordinary income for federal income tax purposes pursuant to Section 988 of the Internal Revenue Code.
The aggregate cost of investments and the composition of unrealized appreciation and depreciation of investment securities for federal income tax purposes as of December 31, 2010 are noted below.
Unrealized appreciation and unrealized depreciation in the table below exclude appreciation/(depreciation) on foreign currency translations. The primary difference between book and tax appreciation or depreciation of investments is wash sale loss deferrals and passive foreign investment companies.
Net Tax | ||||||||||||||
Federal Tax | Unrealized | Unrealized | Appreciation/ | |||||||||||
Fund | Cost | Appreciation | (Depreciation) | (Depreciation) | ||||||||||
INTECH Risk-Managed Core Fund | $ | 249,841,944 | $ | 51,851,901 | $ | (835,086) | $ | 51,016,815 | ||||||
INTECH Risk-Managed Growth Fund | 269,413,057 | 64,876,502 | (326,889) | 64,549,613 | ||||||||||
INTECH Risk-Managed International Fund | 6,746,400 | 1,239,444 | (50,093) | 1,189,351 | ||||||||||
INTECH Risk-Managed Value Fund | 84,568,788 | 13,940,275 | (211,502) | 13,728,773 | ||||||||||
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Net capital loss carryovers as of June 30, 2010 are indicated in the table below. These losses may be available to offset future realized capital gains and thereby reduce future taxable gains distributions. The following table shows the expiration dates of the carryovers.
Capital Loss Carryover Expiration Schedule
For the eight- or eleven-month fiscal period
ended June 30, 2010
Accumulated | ||||||||||||||
Fund | June 30, 2016 | June 30, 2017 | June 30, 2018 | Capital Losses | ||||||||||
INTECH Risk-Managed Core Fund(1)(2) | $ | (20,383,632) | $ | (69,734,790) | $ | – | $ | (90,118,422) | ||||||
INTECH Risk-Managed Growth Fund(3) | – | (118,461,846) | (181,101,744) | (299,563,590) | ||||||||||
INTECH Risk-Managed International Fund(3) | (175,182) | (1,513,408) | (2,035,662) | (3,724,252) | ||||||||||
INTECH Risk-Managed Value Fund(3) | (301,746) | (2,445,926) | (14,990,749) | (17,738,421) | ||||||||||
(1) | Capital loss carryovers subject to annual limitations. | |
(2) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(3) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. |
6. | Expense Ratios |
The expense ratios listed in the Financial Highlights reflect expenses prior to any expense offsets (gross expense ratio) and after expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursement). Listed below are the gross expense ratios for the Funds that would have been in effect, absent the waiver of certain fees and offsets.
For the six-month period ended December 31,
2010 (unaudited), the eight- or eleven-month
fiscal period ended June 30, 2010 and each fiscal
year or period ended October 31 or July 31
2010 (unaudited), the eight- or eleven-month
fiscal period ended June 30, 2010 and each fiscal
year or period ended October 31 or July 31
INTECH Risk- | ||||||||||||||||
INTECH Risk- | INTECH Risk- | Managed | INTECH Risk- | |||||||||||||
Managed Core | Managed Growth | International | Managed Value | |||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||
Class A Shares | ||||||||||||||||
2010 | 1.09% | 0.92% | 3.76% | 1.08% | ||||||||||||
2010(1) | N/A | 0.90% | 4.61% | 1.05% | ||||||||||||
2010(2) | 1.15% | N/A | N/A | N/A | ||||||||||||
2009(3) | N/A | 0.82% | 6.45% | 1.33% | ||||||||||||
2009(4) | 1.25% | N/A | N/A | N/A | ||||||||||||
2008 | N/A | 0.78% | 4.18% | 1.17% | ||||||||||||
2007 | N/A | 0.81% | 6.11%(5) | 1.35% | ||||||||||||
2006 | N/A | 0.91% | N/A | 3.67%(6) | ||||||||||||
2005 | N/A | 0.93%(7) | N/A | N/A | ||||||||||||
Class C Shares | ||||||||||||||||
2010 | 1.93% | 2.44% | 4.50% | 1.88% | ||||||||||||
2010(1) | N/A | 2.82% | 5.33% | 1.80% | ||||||||||||
2010(2) | 1.56% | N/A | N/A | N/A | ||||||||||||
2009(3) | N/A | 1.67% | 7.20% | 1.99% | ||||||||||||
2009(4) | 2.17% | N/A | N/A | N/A | ||||||||||||
2008 | N/A | 1.60% | 4.93% | 1.96% | ||||||||||||
2007 | N/A | 1.59% | 6.86%(5) | 2.05% | ||||||||||||
2006 | N/A | 1.64% | N/A | 4.42%(6) | ||||||||||||
2005 | N/A | 1.84% | N/A | N/A | ||||||||||||
Class D Shares | ||||||||||||||||
2010 | 0.95% | N/A | N/A | N/A | ||||||||||||
2010(8) | 0.61% | N/A | N/A | N/A |
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Notes to Financial Statements (unaudited) (continued)
INTECH Risk- | ||||||||||||||||
INTECH Risk- | INTECH Risk- | Managed | INTECH Risk- | |||||||||||||
Managed Core | Managed Growth | International | Managed Value | |||||||||||||
Fund | Fund | Fund | Fund | |||||||||||||
Class I Shares | ||||||||||||||||
2010 | 0.83% | 0.62% | 4.20% | 0.81% | ||||||||||||
2010(1) | N/A | 0.62% | 4.68% | 0.77% | ||||||||||||
2010(2) | 0.53% | N/A | N/A | N/A | ||||||||||||
2009(3) | N/A | 0.55% | 6.34% | 0.96% | ||||||||||||
2009(4) | 0.80% | N/A | N/A | N/A | ||||||||||||
2008 | N/A | 0.53% | 3.92% | 0.90% | ||||||||||||
2007 | N/A | 0.56% | 5.86%(5) | 1.09% | ||||||||||||
2006 | N/A | 0.61%(9) | N/A | 2.91%(6) | ||||||||||||
Class S Shares | ||||||||||||||||
2010 | 1.29% | 1.12% | 3.99% | 1.29% | ||||||||||||
2010(1) | N/A | 1.12% | 4.83% | 1.27% | ||||||||||||
2010(2) | 1.03% | N/A | N/A | N/A | ||||||||||||
2009(3) | N/A | 1.04% | 6.66% | 1.44% | ||||||||||||
2009(4) | 1.27% | N/A | N/A | N/A | ||||||||||||
2008 | N/A | 1.02% | 4.43% | 1.41% | ||||||||||||
2007 | N/A | 1.05% | 6.36%(5) | 1.62% | ||||||||||||
2006 | N/A | 1.15% | N/A | 3.92%(6) | ||||||||||||
2005 | N/A | 1.27% | N/A | N/A | ||||||||||||
Class T Shares | ||||||||||||||||
2010 | 1.04% | 0.82% | 3.59% | 1.04% | ||||||||||||
2010(1) | N/A | 0.85% | 4.81% | 0.99% | ||||||||||||
2010(2) | 0.79% | N/A | N/A | N/A | ||||||||||||
2009(10) | N/A | 0.75% | 14.17% | 1.66% | ||||||||||||
2009(11) | 0.91% | N/A | N/A | N/A | ||||||||||||
2008 | 0.75% | N/A | N/A | N/A | ||||||||||||
2007 | 0.77% | N/A | N/A | N/A | ||||||||||||
2006 | 0.91% | N/A | N/A | N/A | ||||||||||||
2005 | 0.89% | N/A | N/A | N/A | ||||||||||||
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(3) | Period from August 1, 2008 through July 31, 2009. | |
(4) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(5) | Period from May 2, 2007 (inception date) through July 31, 2007. | |
(6) | Period from December 30, 2005 (inception date) through July 31, 2006. | |
(7) | Period from September 30, 2004 (inception date) through July 31, 2005. | |
(8) | Period from February 16, 2010 (inception date) through June 30, 2010. | |
(9) | Period from November 28, 2005 (inception date) through July 31, 2006. | |
(10) | Period from July 6, 2009 (inception date) through July 31, 2009. | |
(11) | Period from November 1, 2008 through October 31, 2009. |
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7. | Capital Share Transactions |
For the six-month period ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2010 (unaudited), the | INTECH | INTECH | INTECH | INTECH | ||||||||||||||||||||||||||||||||||||||||||||||
eight- or eleven-month fiscal period | Risk-Managed | Risk-Managed | Risk-Managed | Risk-Managed | ||||||||||||||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Core | Growth | International | Value | ||||||||||||||||||||||||||||||||||||||||||||||
year ended October 31 or July 31 | Fund | Fund | Fund | Fund | ||||||||||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class A Shares: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 171 | 107 | 53 | 63 | 205 | 449 | – | 1 | 14 | 73 | 100 | 443 | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 7 | 7 | 1,534 | 6 | 9 | 23 | 4 | 2 | 12 | 6 | 2 | 11 | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (173) | (318) | (355) | (557) | (942) | (1,270) | (1) | (10) | (5) | (55) | (99) | (91) | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 5 | (204) | 1,232 | (488) | (728) | (798) | 3 | (7) | 21 | 24 | 3 | 363 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 1,028 | 1,232 | – | 1,132 | 1,860 | 2,658 | 273 | 280 | 259 | 470 | 467 | 104 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 1,033 | 1,028 | 1,232 | 644 | 1,132 | 1,860 | 276 | 273 | 280 | 494 | 470 | 467 | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class C Shares: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 9 | 21 | 23 | 4 | 29 | 74 | – | 1 | – | 11 | 6 | 6 | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | – | 1 | 869 | – | – | 1 | 4 | 2 | 9 | – | – | 1 | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (109) | (172) | (139) | (57) | (160) | (261) | – | (1) | – | (4) | (2) | (4) | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (100) | (150) | 753 | (53) | (131) | (186) | 4 | 2 | 9 | 7 | 4 | 3 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 603 | 753 | – | 387 | 518 | 704 | 266 | 264 | 255 | 42 | 38 | 35 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 503 | 603 | 753 | 334 | 387 | 518 | 270 | 266 | 264 | 49 | 42 | 38 | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class D Shares:(5) | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 377 | 367 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 9) | – | 13,092 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 124 | – | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (1,162) | (828) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (661) | 12,631 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 12,631 | – | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 11,970 | 12,631 | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class I Shares: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 343 | 1,426 | 445 | 1,379 | 6,778 | 20,377 | 16 | 56 | 80 | 1,029 | 1,257 | 2,775 | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 33 | 24 | 5,008 | 223 | 509 | 1,759 | 3 | 3 | 15 | 114 | 45 | 340 | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (1,075) | (1,095) | (1,121) | (13,767) | (54,022) | (34,409) | (19) | (222) | (26) | (232) | (1,005) | (1,430) | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (699) | 355 | 4,332 | (12,165) | (46,735) | (12,273) | – | (163) | 69 | 911 | 297 | 1,685 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 4,687 | 4,332 | – | 36,291 | 83,026 | 95,299 | 192 | 355 | 286 | 8,387 | 8,090 | 6,405 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 3,988 | 4,687 | 4,332 | 24,126 | 36,291 | 83,026 | 192 | 192 | 355 | 9,298 | 8,387 | 8,090 |
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Notes to Financial Statements (unaudited) (continued)
For the six-month period ended | ||||||||||||||||||||||||||||||||||||||||||||||||||
December 31, 2010 (unaudited), the | INTECH | INTECH | INTECH | INTECH | ||||||||||||||||||||||||||||||||||||||||||||||
eight- or eleven-month fiscal period | Risk-Managed | Risk-Managed | Risk-Managed | Risk-Managed | ||||||||||||||||||||||||||||||||||||||||||||||
ended June 30, 2010 and the fiscal | Core | Growth | International | Value | ||||||||||||||||||||||||||||||||||||||||||||||
year ended October 31 or July 31 | Fund | Fund | Fund | Fund | ||||||||||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class S Shares: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 23 | 79 | 20 | 72 | 178 | 881 | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 2 | 2 | 597 | 7 | 7 | 34 | 4 | 2 | 11 | – | – | 1 | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (49) | (150) | (185) | (548) | (747) | (4,402) | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (24) | (69) | 432 | (469) | (562) | (3,487) | 4 | 2 | 11 | – | – | 1 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 363 | 432 | – | 1,491 | 2,053 | 5,540 | 266 | 264 | 253 | 27 | 27 | 26 | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 339 | 363 | 432 | 1,022 | 1,491 | 2,053 | 270 | 266 | 264 | 27 | 27 | 27 | ||||||||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||||||||||||||||||||||||||||||||||||||
Shares sold | 308 | 657 | 2,437 | 2 | 1 | 111* | 1 | 2 | 169* | – | 4 | 150* | ||||||||||||||||||||||||||||||||||||||
Shares reorganized in connection with restructuring (Note 9) | N/A | (13,092) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | ||||||||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 47 | 136 | 718 | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||
Shares repurchased | (793) | (3,318) | (6,233) | – | – | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (438) | (15,617) | (3,078) | 2 | 1 | 111* | 1 | 2 | 169* | – | 4 | 150* | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 5,485 | 21,102 | 24,180 | 1 | – | – | 2 | – | – | 4 | – | – | ||||||||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 5,047 | 5,485 | 21,102 | 3 | 1 | 111* | 3 | 2 | 169* | 4 | 4 | 150* |
* | Shares are not in thousands. | |
(1) | Period from November 1 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009 for Class A Shares, Class C Shares, Class I Shares and Class S Shares and November 1, 2008 through October 31, 2009 for Class T Shares. | |
(3) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from August 1, 2008 through July 31, 2009 for Class A Shares, Class C Shares, Class I Shares and Class S Shares and July 6, 2009 (inception date) through July 31, 2009 for Class T Shares. | |
(5) | Transactions in Fund Shares for Class D Shares are for the period from February 16, 2010 (inception date) to June 30, 2010. |
8. | Purchases and Sales of Investment Securities |
For the period ended December 31, 2010, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities and short-term options contracts) was as follows:
Purchases of Long- | Proceeds from Sales | |||||||||||||
Purchases of | Proceeds from Sales | Term U.S. Government | of Long-Term U.S. | |||||||||||
Fund | Securities | of Securities | Obligations | Government Obligations | ||||||||||
INTECH Risk-Managed Core Fund | $ | 140,738,656 | $ | 164,854,515 | $ | – | $ | – | ||||||
INTECH Risk-Managed Growth Fund | 156,532,663 | 299,318,774 | – | – | ||||||||||
INTECH Risk-Managed International Fund | 4,816,775 | 4,830,005 | – | – | ||||||||||
INTECH Risk-Managed Value Fund | 42,942,384 | 34,974,289 | – | – | ||||||||||
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9. | Shares Issued in Connection with Restructuring |
Effective February 16, 2010, Class J Shares of INTECH Risk-Managed Core Fund were renamed Class T Shares and are available through certain financial intermediary platforms. In addition, Class J Shares held directly with Janus were moved to newly created Class D Shares, a share class dedicated to shareholders investing directly with Janus. Class D Shares commenced operations on February 16, 2010. The shares issued in connection with the restructuring from Class J Shares to Class D Shares are reflected on the Statements of Changes in Net Assets and in the Capital Share Transactions table in Note 7.
10. | Fund Acquisition |
On July 6, 2009, INTECH Risk-Managed Core Fund acquired all of the net assets of Janus Adviser INTECH Risk-Managed Core Fund pursuant to a plan of reorganization approved by the Trustees of the Trust. The reorganization was accomplished by a tax-free exchange of shares of Janus Adviser INTECH Risk-Managed Core Fund in the amount of 8,208,584 shares (valued at $74,176,255) for the 8,007,695 shares of INTECH Risk-Managed Core Fund, including $2,376,861 of unrealized appreciation. The aggregate net assets of INTECH Risk-Managed Core Fund and Janus Adviser INTECH Risk-Managed Core Fund immediately before the reorganization were $209,095,390 and $74,176,255, respectively. The aggregate net assets immediately after the reorganization were $283,271,645.
11. | Pending Legal Matters |
In the fall of 2003, the Securities and Exchange Commission (“SEC”), the Office of the New York State Attorney General (“NYAG”), the Colorado Attorney General (“COAG”), and the Colorado Division of Securities (“CDS”) announced that they were investigating alleged frequent trading practices in the mutual fund industry. On August 18, 2004, Janus Capital announced that it had reached final settlements with the SEC, the NYAG, the COAG, and the CDS related to such regulators’ investigations into Janus Capital’s frequent trading arrangements.
A number of civil lawsuits were brought in several state and federal jurisdictions against Janus Capital and certain of its affiliates, the Janus funds, and related entities and individuals based on allegations similar to those announced by the above regulators. Such lawsuits alleged a variety of theories for recovery including, but not limited to, the federal securities laws, other federal statutes (including ERISA), and various common law doctrines. The Judicial Panel on Multidistrict Litigation transferred these actions to the U.S. District Court for the District of Maryland (the “Court”) for coordinated proceedings. On September 29, 2004, five consolidated amended complaints were filed with the Court, two of which still remain: (i) claims by a putative class of shareholders of Janus Capital Group Inc. (“JCGI”) asserting claims on behalf of the shareholders against JCGI and Janus Capital (First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S. District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins, et al. v. Janus Capital Group, Inc., et al., U.S. District Court, District of Maryland, Case No. 04-CV-00818); and (ii) derivative claims by investors in certain Janus funds ostensibly on behalf of such funds (Steinberg et al. v. Janus Capital Management, LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518).
In the First Derivative Traders case (action (i) above), a Motion to Dismiss was previously granted and the matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the United States Court of Appeals for the Fourth Circuit (“Fourth Circuit”). In May 2009, the Fourth Circuit reversed the order of dismissal and remanded the case back to the trial court for further proceedings. In June 2010, the United States Supreme Court agreed to review the Fourth Circuit’s decision. As a result of these developments at the Supreme Court, the trial court has stayed all further proceedings until the Supreme Court rules on the matter. In the Steinberg case (action (ii) above), the trial court entered an order on January 20, 2010, granting Janus Capital’s Motion for Summary Judgment and dismissing the remaining claims asserted against the company. However, in February 2010, Plaintiffs appealed the trial court’s decision with the Fourth Circuit.
Additional lawsuits may be filed against certain of the Janus funds, Janus Capital, and related parties in the future. Janus Capital does not currently believe that these pending actions will materially affect its ability to continue providing services it has agreed to provide to the Janus funds.
12. | New Accounting Pronouncements |
In January 2010, the FASB issued Accounting Standards Update, “Improving Disclosures About Fair Value Measurements.” The Accounting Standards Update requires disclosures about purchases, sales, issuances, and settlements on a gross basis relating to Level 3 measurements. This disclosure will become effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact the adoption of this Accounting Standards Update will have on the Funds’ financial statement disclosures.
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Notes to Financial Statements (unaudited) (continued)
13. | Subsequent Event |
Management has evaluated whether any events or transactions occurred subsequent to December 31, 2010 and through the date of issuance of the Funds’ financial statements and determined that there were no material events or transactions that would require recognition or disclosure in the Funds’ financial statements.
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Additional Information (unaudited)
Proxy Voting Policies and Voting Record
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to their portfolio securities is available without charge: (i) upon request, by calling 1-800-525-0020 (toll free); (ii) on the Funds’ website at janus.com/proxyvoting; and (iii) on the SEC’s website at http://www.sec.gov. Additionally, information regarding each Fund’s proxy voting record for the most recent twelve-month period ended June 30 is also available, free of charge, through janus.com/proxyvoting and from the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Holdings
The Funds file their complete portfolio holdings (schedule of investments) with the SEC for the first and third quarters of each fiscal year on Form N-Q within 60 days of the end of such fiscal quarter. The Funds’ Form N-Q: (i) is available on the SEC’s website at http://www.sec.gov; (ii) may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the Public Reference Room may be obtained by calling 1-800-SEC-0330); and (iii) is available without charge, upon request, by calling Janus at 1-800-525-0020 (toll free).
Approval of Advisory Agreements During The Period
The Trustees of Janus Investment Fund, none of whom has ever been affiliated with Janus Capital (“Independent Trustees”), oversee the management of each Fund and, as required by law, determine annually whether to continue the investment advisory agreement for each Fund and the subadvisory agreements for the nine Funds that utilize subadvisers.
In connection with their most recent consideration of those agreements for each Fund, the Trustees received and reviewed a substantial amount of information provided by Janus Capital and the respective subadvisers in response to requests of the Independent Trustees and their independent legal counsel. They also received and reviewed a considerable amount of information and analysis provided by their independent fee consultant. Throughout their consideration of the agreements, the Independent Trustees were advised by their independent legal counsel. The Independent Trustees met with management to consider the agreements, and also met separately in executive session with their independent legal counsel and their independent fee consultant.
At a meeting held on December 3, 2010, based on the Trustees’ evaluation of the information provided by Janus Capital, the subadvisers and the independent fee consultant, as well as other information, the Trustees determined that the overall arrangements between each Fund and Janus Capital and each subadviser, as applicable, were fair and reasonable in light of the nature, extent and quality of the services provided by Janus Capital, its affiliates and the subadvisers, the fees charged for those services, and other matters that the Trustees considered relevant in the exercise of their business judgment. At that meeting, the Trustees unanimously approved the continuation of the investment advisory agreement for each Fund, and the subadvisory agreement for each subadvised Fund, for the period from February 1, 2011 through February 1, 2012, subject to earlier termination as provided for in each agreement.
In considering the continuation of those agreements, the Trustees reviewed and analyzed various factors that they determined were relevant, including the factors described below, none of which by itself was considered dispositive. However, the material factors and conclusions that formed the basis for the Trustees’ determination to approve the continuation of the agreements are discussed separately below.
Nature, Extent and Quality of Services
The Trustees reviewed the nature, extent and quality of the services provided by Janus Capital and the subadvisers to the Funds, taking into account the investment objective and strategy of each Fund and the knowledge the Trustees gained from their regular meetings with management on at least a quarterly basis and their ongoing review of information related to the Funds. In addition, the Trustees reviewed the resources and key personnel of Janus Capital and each subadviser, particularly noting those employees who provide investment management services to the Funds. The Trustees also considered other services provided to the Funds by Janus Capital or the subadvisers, such as managing the execution of portfolio transactions and the selection of broker-dealers for those transactions, serving as the Funds’ administrator, monitoring adherence to the Funds’ investment restrictions, producing shareholder reports, providing support services for the Trustees and Trustee committees, communicating with shareholders and overseeing the activities of other service providers, including monitoring compliance with various policies and procedures of the Funds and with applicable securities laws and regulations.
The Trustees concluded that the nature, extent and quality of the services provided by Janus Capital or the subadviser to each Fund were appropriate and consistent with the terms of the respective advisory and subadvisory agreements, and that, taking into account steps taken to address those Funds whose performance lagged that of
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Additional Information (unaudited) (continued)
their peers for certain periods, the quality of those services had been consistent with or superior to quality norms in the industry and the Funds were likely to benefit from the continued provision of those services. They also concluded that Janus Capital and each subadviser had sufficient personnel, with the appropriate education and experience, to serve the Funds effectively and had demonstrated its continuing ability to attract well-qualified personnel.
Performance of the Funds
The Trustees considered the performance results of each Fund over various time periods. They reviewed information comparing each Fund’s performance with the performance of comparable funds and peer groups identified by Lipper, and with the Fund’s benchmark index. They concluded that the performance of many Funds was good to very good under current market conditions. Although the performance of some Funds lagged that of their peers for certain periods, the Trustees also concluded that Janus Capital had taken or was taking appropriate steps to address those instances of under-performance.
Costs of Services Provided
The Trustees examined information regarding the fees and expenses of each Fund in comparison to similar information for other comparable funds as provided by Lipper. They also reviewed an analysis of that information provided by their independent fee consultant and noted that the rate of management (investment advisory and administrative) fees for most of the Funds, after applicable contractual expense limitations, was below the mean management fee rate of the respective peer group of funds selected by Lipper.
The Trustees considered the methodology used by Janus Capital and each subadviser in determining compensation payable to portfolio managers, the competitive environment for investment management talent and the competitive market for mutual funds in different distribution channels. They concluded that the compensation methodology provided a good alignment of the interests of the portfolio managers with the interests of Fund shareholders.
The Trustees also reviewed management fees charged by Janus Capital to its separate account clients and to non-affiliated funds subadvised by Janus Capital (for which Janus Capital provides only portfolio management services). Although in most instances subadvisory and separate account fee rates for various investment strategies were lower than management fee rates for Funds having a similar strategy, the Trustees noted that, under the terms of the management agreements with the Funds, Janus Capital performs significant additional services for the Funds that it does not provide to those other clients, including administrative services, oversight of the Funds’ other service providers, trustee support, regulatory compliance and numerous other services, and that, in serving the Funds, Janus Capital assumes many legal risks that it does not assume in servicing its other clients. Moreover, they noted that the spread between the average fee rates charged to the Funds and the fee rates that Janus Capital charged to its separate account clients was significantly smaller than the average spread for such fee rates of other advisers, based on publicly available data and research conducted by the Trustees’ independent fee consultant.
The Trustees reviewed information on the profitability to Janus Capital and its affiliates of their relationships with each Fund, as well as an explanation of the methodology utilized in allocating various expenses of Janus Capital and its affiliates among the Funds and other clients. The Trustees also reviewed the financial statements and corporate structure of Janus Capital’s parent company. In their review, the Trustees considered whether Janus Capital and each subadviser receive adequate incentives to manage the Funds effectively. The Trustees recognized that profitability comparisons among fund managers are difficult because very little comparative information is publicly available and the profitability of any fund manager is affected by numerous factors, including the organizational structure of the particular fund manager, the types of funds and other accounts it manages, possible other lines of business, the methodology for allocating expenses and the fund manager’s capital structure and cost of capital. However, taking into account those factors and the analysis provided by the Trustees’ independent fee consultant, and based on the information available, the Trustees concluded that Janus Capital’s profitability with respect to each Fund in relation to the services rendered was not unreasonable.
The Trustees concluded that the management fees and other compensation payable by each Fund to Janus Capital and its affiliates, as well as the fees paid by Janus Capital to the subadvisers of subadvised Funds, were reasonable in relation to the nature, extent and quality of the services provided, taking into account the fees charged by other advisers for managing comparable mutual funds with similar strategies and the fees Janus Capital and the subadvisers charge to other clients. The Trustees also concluded that the overall expense ratio of each Fund was reasonable, taking into account the size of the Fund, the quality of services provided by Janus Capital and any subadviser, the investment performance of the Fund and any expense limitations agreed to by Janus Capital.
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Economies of Scale
The Trustees considered information about the potential for Janus Capital to realize economies of scale as the assets of the Funds increase. They noted that, although many Funds pay advisory fees at a fixed rate as a percentage of net assets, without any breakpoints, the actual management fee rate paid by each Fund, after any contractual expense limitations, was below the mean management fee rate of the Fund’s peer group identified by Lipper; and, for those Funds whose expenses are being reduced by the contractual expense limitations of Janus Capital, Janus Capital is subsidizing the Funds because they have not reached adequate scale. Moreover, as the assets of many of the Funds have declined in the past few years, the Funds have benefited from having advisory fee rates that have remained constant rather than increasing as assets declined. In addition, performance fee structures have been implemented for several Funds that have caused or will cause the effective rate of advisory fees payable by such a Fund to vary depending on the investment performance of the Fund relative to its benchmark index over the measurement period; and a few Funds have fee schedules with breakpoints and reduced fee rates above certain asset levels. The Trustees also noted that the Funds share directly in economies of scale through the lower charges of third-party service providers that are based in part on the combined scale of all of the Funds. Based on all of the information they reviewed, including research and analysis conduct by the Trustees’ Independent Fee Consultant, the Trustees concluded that the current fee structure of each Fund was reasonable and that the current rates of fees do reflect a sharing between Janus Capital and the Fund of economies of scale at the current asset level of the Fund.
Other Benefits to Janus Capital
The Trustees also considered benefits that accrue to Janus Capital and its affiliates from their relationships with the Funds. They recognized that two affiliates of Janus Capital separately serve the Funds as transfer agent and distributor, respectively, and the transfer agent receives compensation directly from the non-money market funds for services provided. The Trustees also considered Janus Capital’s past and proposed use of commissions paid by the Funds on their portfolio brokerage transactions to obtain proprietary and third-party research products and services benefiting the Fund and/or other clients of Janus Capital. The Trustees concluded that Janus Capital’s use of these types of client commission arrangements to obtain proprietary and third-party research products and services was consistent with regulatory requirements and guidelines and was likely to benefit each Fund. The Trustees also concluded that, other than the services provided by Janus Capital and its affiliates pursuant to the agreements and the fees to be paid by each Fund therefor, the Funds and Janus Capital may potentially benefit from their relationship with each other in other ways. They concluded that Janus Capital benefits from the receipt of research products and services acquired through commissions paid on portfolio transactions of the Funds and that the Funds benefit from Janus Capital’s receipt of those products and services as well as research products and services acquired through commissions paid by other clients of Janus Capital. They further concluded that success of any Fund could attract other business to Janus Capital or other Janus funds, and that the success of Janus Capital could enhance Janus Capital’s ability to serve the Funds.
After full consideration of the above factors, as well as other factors, the Trustees, each of whom is an Independent Trustee, concluded at their December 3, 2010 meeting that the proposed continuation of the investment advisory agreement and, if applicable, the subadvisory agreement for each Fund for another year was in the best interest of the respective Funds and their shareholders.
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Explanations of Charts, Tables and
Financial Statements (unaudited)
Financial Statements (unaudited)
1. | Performance Overviews |
Performance overview graphs compare the performance of a hypothetical $10,000 investment in each Fund (from inception) with one or more widely used market indices. The hypothetical example does not represent the returns of any particular investment.
When comparing the performance of a Fund with an index, keep in mind that market indices do not include brokerage commissions that would be incurred if you purchased the individual securities in the index. They also do not include taxes payable on dividends and interest or operating expenses incurred if you maintained a Fund invested in the index.
Average annual total returns are also quoted for each Fund. Average annual total return is calculated by taking the growth or decline in value of an investment over a period of time, including reinvestment of dividends and distributions, then calculating the annual compounded percentage rate that would have produced the same result had the rate of growth been constant throughout the period. Average annual total return does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares.
Pursuant to federal securities rules, expense ratios shown in the performance chart reflect subsidized and unsubsidized ratios for the prior fiscal year. The total annual fund operating expenses ratio is gross of any fee waivers, reflecting a Fund’s unsubsidized expense ratio. The net annual fund operating expenses ratio (if applicable) includes contractual waivers of Janus Capital and/or Janus Services and reflects a Fund’s subsidized expense ratio. Both the total annual fund operating expenses ratio and net annual fund operating expenses ratio are based on average net assets as of the fiscal period ended June 30, 2010. The ratios also include expenses indirectly incurred by a Fund as a result of investing in other investment companies or pooled investments, which are not reflected in the “Financial Highlights” of this report. As a result, these ratios may be higher or lower than those shown in the “Financial Highlights” in this report. All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
2. | Schedules of Investments |
Following the performance overview section is each Fund’s Schedule of Investments. This schedule reports the industry concentrations and types of securities held in each Fund on the last day of the reporting period. Securities are usually listed by type (common stock, corporate bonds, U.S. Government obligations, etc.) and by industry classification (banking, communications, insurance, etc.). Holdings are subject to change without notice.
The value of each security is quoted as of the last day of the reporting period. The value of securities denominated in foreign currencies is converted into U.S. dollars.
If a Fund invests in foreign securities, it will also provide a summary of investments by country. This summary reports each Fund’s exposure to different countries by providing the percentage of securities invested in each country. The country of each security represents the country in which the company is incorporated. Each Fund’s Schedule of Investments relies upon the industry group and country classifications published by Bloomberg L.P.
2a. Forward Currency Contracts
A table listing forward currency contracts follows each Fund’s Schedule of Investments (if applicable). Forward currency contracts are agreements to deliver or receive a preset amount of currency at a future date. Forward currency contracts are used to hedge against foreign currency risk in the Funds’ long-term holdings.
The table provides the name of the foreign currency, the settlement date of the contract, the amount of the contract, the value of the currency in U.S. dollars and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the change in currency exchange rates from the time the contract was opened to the last day of the reporting period.
2b. Futures
A table listing futures contracts follows each Fund’s Schedule of Investments (if applicable). Futures contracts are contracts that obligate the buyer to receive and the seller to deliver an instrument or money at a specified price on a specified date. Futures are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, the principal amount, value and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the marked-to-market amount for the last day of the reporting period.
2c. Options
A table listing written options contracts follows each Fund’s Schedule of Investments (if applicable). Written options contracts are contracts that obligate a Fund to sell or purchase an underlying security at a fixed price, upon exercise of the option. Options are used to hedge against
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adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, exercise price, value and premiums received.
3. | Statements of Assets and Liabilities |
These statements are often referred to as the “balance sheets.” It lists the assets and liabilities of the Funds on the last day of the reporting period.
The Funds’ assets are calculated by adding the value of the securities owned, the receivable for securities sold but not yet settled, the receivable for dividends declared but not yet received on stocks owned and the receivable for Fund shares sold to investors but not yet settled. The Funds’ liabilities include payables for securities purchased but not yet settled, Fund shares redeemed but not yet paid and expenses owed but not yet paid. Additionally, there may be other assets and liabilities such as unrealized gain or loss on forward currency contracts.
The section entitled “Net Assets Consist of” breaks down the components of the Funds’ net assets. Because the Funds must distribute substantially all earnings, you will notice that a significant portion of net assets is shareholder capital.
The last section of this statement reports the net asset value (“NAV”) per share on the last day of the reporting period. The NAV is calculated by dividing the Funds’ net assets (assets minus liabilities) by the number of shares outstanding.
4. | Statements of Operations |
These statements detail the Funds’ income, expenses, gains and losses on securities and currency transactions, and appreciation or depreciation of current Fund holdings.
The first section in this statement, entitled “Investment Income,” reports the dividends earned from stocks and interest earned from interest-bearing securities in the Funds.
The next section reports the expenses incurred by the Funds, including the advisory fee paid to the investment adviser, transfer agent fees and expenses, and printing and postage for mailing statements, financial reports and prospectuses. Expense offsets and expense reimbursements, if any, are also shown.
The last section lists the increase or decrease in the value of securities held in the Funds. The Funds will realize a gain (or loss) when they sell their position in a particular security. An unrealized gain (or loss) refers to the change in net appreciation or depreciation of the Funds during the reporting period. “Net Realized and Unrealized Gain/(Loss) on Investments” is affected both by changes in the market value of Fund holdings and by gains (or losses) realized during the reporting period.
5. | Statements of Changes in Net Assets |
These statements report the increase or decrease in the Funds’ net assets during the reporting period. Changes in the Funds’ net assets are attributable to investment operations, dividends, distributions and capital share transactions. This is important to investors because it shows exactly what caused the Funds’ net asset size to change during the period.
The first section summarizes the information from the Statements of Operations regarding changes in net assets due to the Funds’ investment performance. The Funds’ net assets may also change as a result of dividend and capital gains distributions to investors. If investors receive their dividends in cash, money is taken out of the Funds to pay the distribution. If investors reinvest their dividends, the Funds’ net assets will not be affected. If you compare each Fund’s “Net Decrease from Dividends and Distributions” to the “Reinvested dividends and distributions,” you will notice that dividend distributions had little effect on each Fund’s net assets. This is because the majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under “Capital Share Transactions.” “Capital Shares” refers to the money investors contribute to the Funds through purchases or withdrawals via redemptions. “Redemption Fees” (if applicable) refers to the fee paid to the Funds for shares held for 90 days or less by a shareholder. The Funds’ net assets will increase and decrease in value as investors purchase and redeem shares from the Funds.
6. | Financial Highlights |
This schedule provides a per-share breakdown of the components that affect each Fund’s NAV for current and past reporting periods. Not only does this table provide you with total return, it also reports total distributions, asset size, expense ratios and portfolio turnover rate.
The first line in the table reflects the NAV per share at the beginning of the reporting period. The next line reports the net investment income per share, which comprises dividends and interest income earned on securities held by the Funds. Following is the total of gains/(losses), realized and unrealized. Dividends and distributions are then subtracted to arrive at the NAV per share at the end of the period. The next line reflects the average annual total return reported the last day of the period. The total
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Explanations of Charts, Tables and
Financial Statements (unaudited) (continued)
Financial Statements (unaudited) (continued)
return may include adjustments in accordance with generally accepted accounting principles. As a result, the total return may differ from the total return reflected for shareholder transactions.
Also included are the expense ratios, or the percentage of average net assets that were used to cover operating expenses during the period. Expense ratios vary across the Funds within the Trust for a number of reasons, including the differences in management fees, the frequency of dividend payments and the extent of foreign investments, which entail greater transaction costs.
The Funds’ expenses may be reduced through expense-reduction arrangements. These arrangements may include the use of balance credits or transfer agent fee offsets. The Statements of Operations reflect total expenses before any such offset, the amount of the offset and the net expenses. The expense ratios listed in the Financial Highlights reflect total expenses prior to any expense offset (gross expense ratio) and after the expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursements), if applicable.
The ratio of net investment income/(loss) summarizes the income earned less expenses, divided by the average net assets of a Fund during the reporting period. Don’t confuse this ratio with a Fund’s yield. The net investment income ratio is not a true measure of a Fund’s yield because it doesn’t take into account the dividends distributed to the Fund’s investors.
The next figure is the portfolio turnover rate, which measures the buying and selling activity in a Fund. Portfolio turnover is affected by market conditions, changes in the asset size of a Fund, the nature of the Fund’s investments and the investment style of the investment personnel. A 100% rate implies that an amount equal to the value of the entire portfolio is turned over in a year; a 50% rate means that an amount equal to the value of half the portfolio is traded in a year; and a 200% rate means that an amount equal to the value of the portfolio is traded every six months.
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Notes
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Janus provides access to a wide range of investment disciplines.
Alternative
Janus alternative funds seek to deliver strong risk-adjusted returns over a full market cycle with lower correlation to equity markets than traditional investments.
Asset Allocation
Janus’ asset allocation funds utilize our fundamental, bottom-up research to balance risk over the long term. From fund options that meet investors’ risk tolerance and objectives to a method that incorporates non-traditional investment choices to seek non-correlated sources of risk and return, Janus’ asset allocation funds aim to allocate risk more effectively.
Core
Janus core funds seek investments in more stable and predictable companies. These funds look for a strategic combination of steady growth and for certain funds, some degree of income.
Fixed Income
Janus fixed income funds attempt to provide less risk relative to equities while seeking to deliver a competitive total return through high current income and appreciation. Janus money market funds seek capital preservation and liquidity with current income as a secondary objective.
Global & International
Janus global and international funds seek to leverage Janus’ research capabilities by taking advantage of inefficiencies in foreign markets, where accurate information and analytical insight are often at a premium.
Growth
Janus growth funds focus on companies believed to be the leaders in their respective industries, with solid management teams, expanding market share, margins and efficiencies.
Risk Managed
Our risk-managed funds seek to outperform their respective indices while maintaining a risk profile equal to or lower than the index itself. Managed by INTECH (a Janus subsidiary), these funds use a mathematical process in an attempt to build a more “efficient” portfolio than the index.
Value
Janus value funds invest in companies they believe are poised for a turnaround or are trading at a significant discount to fair value. The goal is to gain unique insight into a company’s true value and identify and evaluate potential catalysts that may unlock shareholder value.
For more information about our funds, contact your investment professional or go to janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus).
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Please consider the charges, risks, expenses and investment objectives carefully before investing or recommending to clients for investment. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus); or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus). Read it carefully before you invest or send money.
Janus Distributors LLC 151 Detroit Street, Denver, CO 80206 (02/11)
Investment products offered are: NOT FDIC-INSURED MAY LOSE VALUE NO BANK GUARANTEE
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2010 SEMIANNUAL REPORT
Janus Value Funds
Perkins Mid Cap Value Fund
Perkins Small Cap Value Fund
Perkins Value Plus Income Fund
HIGHLIGHTS
• | Portfolio management perspective |
• | Investment strategy behind your fund |
• | Fund performance, characteristics and holdings |
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Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS(52687) (or 800.525.3713 if you hold Shares directly with Janus Capital). You can also visit janus.com/info (or janus.com/reports if you hold Shares directly with Janus Capital). Read it carefully before you invest or send money.
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Chief Investment Officer’s Market Perspective (unaudited)
(JEFF KAUTZ PHOTO)
Jeff Kautz
Chief Investment Officer
Economy
The economic picture appeared to grow brighter throughout the fourth quarter, buoyed by general investor enthusiasm, a more favorable political climate, efforts by the Federal Reserve (Fed) to stimulate the economy and the extension of the Bush tax cuts. We have been surprised, but pleased, about this continued momentum. Still, we cannot discount the significant overhangs that have yet to be resolved. As we enter a new year, we expect much of the same as the last: growing signs of economic improvement but at a degree well below that experienced in past rebounds. This likely will lead to continued increased volatility in corporate earnings and, by extension, equity prices.
We want to be more bullish while also keeping in mind a number of critical factors. In our opinion, the economy has not yet made the transition from largely stimulus-induced growth to a more sustainable fundamental footing. U.S. unemployment remains high, wage growth is stagnant and the housing market is fragile. It is clear to us that the recovery still has obstacles to overcome.
Equity Review
The S&P 500 Index rose 10.8% at the end of the period, ending 2010 up 15.1%. Some stocks now offer more attractive yields than the company’s corporate debt, providing potential downside support. And in general, corporate balance sheets remain solid. With approximately $1.9 trillion in cash reserves, firms have been well financed to increase dividend payouts and pursue merger activity, all of which should help support prices going forward.
There is, however, also reason for caution. In addition to the economic concerns outlined earlier, the market rally that began in March 2009 has, in our view, largely been fueled by low-quality stocks and characterized by frequent, extreme volatility. We think the worst mistake investors can make in this environment is to chase returns as not wanting to miss out on the current upswing may introduce significant downside risk into portfolios.
Our portfolio strategies have performed largely as we expected during this period. Although absolute returns are strong, our consistent focus on long-term value can lead to short-term underperformance in momentum-driven markets. This has been true in the recent run-up. Across our strategies, the bulk of the relative underperformance occurred in the first four months of 2010.
Most importantly, our long-term returns continue to be strong, and we remain committed to managing the portfolios in the same disciplined, risk-averse style that has produced long-term outperformance over full market cycles. We have maintained a bias for out-of-favor, larger cap, high-quality names. Our portfolios also continue to hold sizable healthcare and technology weightings. We believe these types of securities offer an appealing blend of defensive characteristics and attractive upside potential that should reward investors in the long run.
Outlook
It will be interesting to see what 2011 holds for investors. The current bull market may continue through the first quarter, but the outlook after that becomes much murkier. Based on our concerns about the uncertainties in the marketplace, we continue to be extremely risk sensitive. Equities still offer the strongest long-term potential for investors, but we encourage our shareholders not to focus too heavily on short-term returns. Our strict, research-focused investment process is designed to minimize capital losses in market declines and benefit from strong absolute returns during market rallies. Historically, this disciplined value approach has maximized the effects of compounding and delivered attractive long-term performance across full market cycles. In fact, both our small and mid cap strategies have delivered double-digit annualized returns over the last decade. In the case of our small cap portfolio that statement extends to two decades.
When researching prospective and existing holdings, we first carefully evaluate each stock’s downside exposure before assessing its normalized, not maximum, upside potential. Our focus is on identifying good companies with solid balance sheets and stable free cash flows, trading at attractive valuations. We believe firmly in this approach, and our portfolio team remains heavily invested in our strategies right alongside our shareholders.
Looking ahead, we want to thank you for your continued investment. We appreciate the confidence you have
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Continued
placed in Perkins Investment Management and look forward to working with you in the years to come.
Sincerely,
![(-s- JEFF KAUTZ)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932skautzje.gif)
Jeff Kautz
Chief Investment Officer
Please consider the charges, risks, expenses and investment objectives carefully before investing. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or download the file from janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital). Read it carefully before you invest or send money.
Investing involves market risk. Investment return and value will fluctuate and it is possible to lose money by investing.
The opinions are those of the author as of December 2010 and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as a recommendation of individual holdings or market sectors, but as an illustration of broader themes.
Any portfolio risk management process discussed includes an effort to monitor and manage risk which should not be confused with and does not imply low risk or the ability to control certain risk factors.
Statements in this piece that reflect projections or expectations of future financial or economic performance of a mutual fund or strategy and of the markets in general and statements of the Fund’s plans and objectives for future operations are forward-looking statements. Actual results or events may differ materially from those projected, estimated, assumed or anticipated in any such forward-looking statements. Important factors that could result in such differences, in addition to the other factors noted with such forward-looking statements, include general economic conditions such as inflation, recession and interest rates.
Past performance is no guarantee of future results.
There is no assurance that the investment process will consistently lead to successful investing.
S&P 500® Index is a commonly recognized, market capitalization weighted index of 500 widely held equity securities, designed to measure broad U.S. equity performance.
Perkins Investment Management LLC is an indirect subsidiary of Janus Capital Group Inc. and serves as the subadviser on certain products.
Funds distributed by Janus Distributors LLC (02/11)
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Useful Information About Your Fund Report (unaudited)
Management Commentaries
The Management Commentaries in this report include valuable insight from each of the Funds’ managers as well as statistical information to help you understand how your Fund’s performance and characteristics stack up against those of comparable indices.
If a Fund invests in foreign securities, this report may include information about country exposure. Country exposure is based primarily on the country of domicile. However, the Funds’ managers may allocate a company to a country based on other factors such as location of the company’s principal office, the location of the principal trading market for the company’s securities, or the country where a majority of the company’s revenues are derived.
Please keep in mind that the opinions expressed by the Funds’ managers in the Management Commentaries are just that: opinions. They are a reflection of the managers’ best judgment at the time this report was compiled, which was December 31, 2010. As the investing environment changes, so could the managers’ opinions. These views are unique to each manager and aren’t necessarily shared by fellow employees or by Janus in general.
Fund Expenses
We believe it’s important for our shareholders to have a clear understanding of Fund expenses and the impact they have on investment return.
The following is important information regarding each Fund’s Expense Example, which appears in each Fund’s Management Commentary within this Semiannual Report. Please refer to this information when reviewing the Expense Example for each Fund.
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments (applicable to Class A Shares only); redemption fees, where applicable (and any related exchange fees); and (2) ongoing costs, including management fees; distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares only); administrative fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class L Shares, Class R Shares, Class S Shares, and Class T Shares only); administrative, networking or omnibus fees (applicable to Class A Shares, Class C Shares, and Class I Shares only); and other Fund expenses. The example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds. The example is based upon an investment of $1,000 invested at the beginning of the period and held for the six-month period from July 1, 2010 to December 31, 2010.
Actual Expenses
The first line of the table in each example provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during the period.
Hypothetical Example for Comparison Purposes
The second line of the table in each example provides information about hypothetical account values and hypothetical expenses based upon each Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Janus Capital Management LLC (“Janus Capital”) has contractually agreed to waive each Fund’s total annual fund operating expenses, excluding any performance adjustments to management fees, class-specific distribution and shareholder servicing (12b-1) fees (applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares only), administrative fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class L Shares, Class R Shares, Class S Shares, and Class T Shares only), brokerage commissions, interest, dividends, taxes, and extraordinary expenses, including, but not limited to, acquired fund fees and expenses, to certain limits until at least November 1, 2011. Expenses in the examples reflect application of these waivers. Had the waivers not been in effect, your expenses would have been higher.
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More information regarding the waivers is available in the Funds’ prospectuses.
Please note that the expenses shown in the tables are meant to highlight your ongoing costs only and do not reflect any transaction costs, such as redemption fees (where applicable) and any related exchange fees. These fees are fully described in the Funds’ prospectuses. Therefore, the second line of each table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transaction costs were included, your costs would have been higher.
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Perkins Large Cap Value Fund (unaudited)
Fund Snapshot We seek to outperform our benchmark and peers over a full market cycle by building diversified portfolios of what we believe to be high quality, undervalued stocks with favorable reward to risk characteristics. We believe that rigorous downside analysis conducted prior to the determination of upside potential helps us to mitigate losses during down markets and perform well in up markets. | Managed by Perkins Investment Management LLC |
Performance Overview
During the six months ended December 31, 2010, Perkins Large Cap Value Fund’s Class I Shares returned 20.23%, underperforming its benchmark, the Russell 1000 Value Index, which returned 21.74%.
The overall U.S. equity market, as represented by the S&P 500 Index returned 23.27% for the period amid improving economic data, the Federal Reserve’s (Fed) quantitative easing (QE2), the extension of tax cuts and some signs that the political environment might be more favorable to business. Small-and mid-cap stocks led the rally. As we are at least as focused on absolute returns as we are relative returns, we are pleased with the Fund’s results despite the underperformance.
Investment Approach, and Positioning
Our cash weighting hurt relative returns during the period. In terms of our stock selection, it was negative in the information technology, consumer discretionary and energy sectors. Conversely, our names within the financials and consumer staples areas helped relative returns, as did our underweighting in utilities. Our industry weightings have not changed much. We continue to be overweight health care, which had significantly underperformed until the elections. With the possibility of some change in health care policy, these relatively cheap stocks have rebounded, yet remain below their past valuations. We continue to find more value opportunities within larger capitalization stocks than those at the smaller end of the spectrum. In fact, it has been decades since higher quality large caps have sold at as much of a discount to smaller caps as they do now. We think in many cases larger cap issues not only sell at below average price-to-earnings (P/E) valuations, but also have strong balance sheets, healthy cash flows, growing dividends, and the financial flexibility that should provide good downside support during periods of uncertainty. (P/E measures the amount investors pay via the stock price for a dollar per share of a company’s earnings). We expect volatility will be at above average levels which should provide us with opportunities to advantageously purchase good long term values. Thus while we are uncertain about the market outlook, we believe we are well positioned to provide competitive returns going forward.
Derivatives
Please see the “Notes to Financial Statements” for a discussion of derivatives used by the Fund.
Contributors
Within materials, copper producer Freeport-McMoRan rebounded off mid-year depressed levels. We significantly increased our position in that period of weakness. Like many commodity prices, copper continued its trend higher given high emerging market demand, particularly from China. Freeport benefited as it is one of the few direct plays. The company is a low cost producer, has a solid balance sheet and robust free cash flow in our view. We pared back the position on strength as the stock’s risk reward became less favorable.
For the six-month period, the energy sector was the best performing group within the Fund’s benchmark as commodity prices continued to head higher. Our biggest investment in this group was Exxon Mobil. We believe it is one of the highest quality companies in its industry. It had significantly lagged in stock price performance. As it rallied toward our price target we reduced our position. While we reduced Exxon Mobil on the strength, it remains one of our larger holdings given its strong balance sheet, solid free cash flow, and historically consistent stock buybacks.
Financial services company Ameriprise Financial rallied as the company had been selling close to book value and at 10x earnings. Fund flows and expense cuts appear to be on track, and the P/E multiple has been expanded as the company is viewed more as an asset manager than a life insurance company. In addition, the balance sheet is comprised of high quality investments in our view. We reduced our holdings as the stock approached our price target.
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Detractors
Bank of America traded lower in the period as concern grew regarding earnings, a flattening yield curve and its subsequent impact on net interest margins, as well as ongoing credit losses. This bank holding company delivered a relatively weak earnings report during the period due to continued losses in its mortgage book. While the earnings power of the franchise is much higher than current levels, the timing of achieving such might be longer than anticipated; however, we believe this is reflected in the share price.
Technology bellwether Cisco Systems underperformed as cuts in government IT purchases impacted sales. We added to our holding as the company has historically been a leader in its field, has $4 per share of net cash on its balance sheet, sells at a P/E multiple of around 12x, (10x adjusted for cash) and because it should benefit from a rebound in corporate technology spending.
Hewlett-Packard was weaker in the period due to the management turnover in the CEO role and because the company embarked on a couple of acquisitions that appear to be expensive. While we believe the balance sheet and free cash flows are rather healthy, and valuation is compelling, the lack of leadership at the top, and the expensive acquisitions announced in the third quarter, led us to reduce our exposure to the name.
Market Outlook
After having disappointing growth in the middle of the year, the economy has shown signs of reaccelerating. Average forecasts of real Gross Domestic Product (GDP) growth in 2011 have moved up from the 2.5% area to 3.0-3.5%. This is the result of the Fed announcing a second phase of monetary easing (QE2) and, most recently, a two year extension of the Bush tax cuts. While these measures will likely be stimulative in the near term, it is debatable as to whether they will have a longer lasting significantly constructive impact. The more optimistic view would be that these policies foster increased consumer and business confidence and build a sustained economic momentum. Additionally in the aftermath of the November elections, Congress and the Administration are likely to be more business friendly. Some observers are making the case that this is indicative of a sea change in policy. While we are hopeful, we do not make investments on hope. Regarding policy we remain skeptical. Most politicians tend to be overly partisan and have had difficulty squarely addressing problems that require sacrifice by their constituents. In the meantime, we continue to believe that Fed policy is an aggressive experiment and it is unclear how it will be unwound. Governmental deficits are unsustainable in many parts of the globe, and state and local budgets represent over 10% of the economy. Unemployment is likely to remain high and housing could continue to be weak.
One of the stated goals of QE2 is to pump up the stock market which creates wealth and confidence that could stimulate the economy. On that score to date, the Fed has been successful as the stock market has had a strong response to the prospect of QE2, the election and tax compromise. Earnings growth has been above expectations and earnings of the S&P 500 should be about $85 per share for 2010. With the stronger economy, further gains could put the S&P’s net earnings at $95 per share in 2011. Thus we believe stocks are selling at a reasonable 13x to 14x expected 2011 earnings. Even with the yield on 10-year Treasuries having backed up to almost 3.5%, stocks offer attractive relative value in our opinion. In fact in recent weeks, bond funds have experienced outflows and stock funds have had net inflows, a reversal of the strong trend that has been a major headwind for stocks. Thus we enter 2011 with very positive investor consensus and equity market momentum which could continue over the near term.
Balancing these positives are the longer term challenges of deficits, deleveraging, and international economic and political imbalances. Thus, we continue to agree with Fed Chairman Bernanke when he stated that the outlook is “unusually uncertain.” Valuations could be restrained by the unlikely sustainability of monetary and fiscal policies that are temporarily supporting the economy. The duration of this “easy money” could be in doubt given the inflationary pressures seen in a broad range of commodities, from oil to cotton, during 2010.
Given the lack of longer term clarity, as has been the case historically, we are focused much more on individual company fundamentals than the macro environment. In a potentially volatile market, we believe that our emphasis on strong balance sheets, free cash flow and below average valuations is especially appropriate. The uncertainty of our economic outlook leads us in many cases to have company earnings estimates that are below consensus. This fits well with our standard sensitivity to risk where we are most focused on the downside support of individual stocks as opposed to the potential upside. We believe it is more important how a portfolio does in down markets than how it performs in up markets. While the fund did lag behind its benchmark in 2010, it has outperformed since its inception, helped by relatively better performance during weak periods in the market.
Thank you for your investment in Perkins Large Cap Value Fund.
6 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Perkins Large Cap Value Fund At A Glance
5 Top Performers – Holdings
Contribution | ||||
Freeport-McMoRan Copper & Gold, Inc. – Class B | 0.86% | |||
Exxon Mobil Corp. | 0.79% | |||
Ameriprise Financial, Inc. | 0.60% | |||
Hess Corp. | 0.58% | |||
AT&T, Inc. | 0.53% |
5 Bottom Performers – Holdings
Contribution | ||||
Bank of America Corp. | –0.10% | |||
Cisco Systems, Inc. | –0.08% | |||
Hewlett-Packard Co. | –0.08% | |||
Entergy Corp. | –0.03% | |||
Comstock Resources, Inc. | –0.02% |
5 Top Performers – Sectors*
Fund Weighting | Russell 1000® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Financials | 5.59% | 25.21% | 27.58% | |||||||||
Energy | 4.46% | 12.34% | 11.47% | |||||||||
Industrials | 2.55% | 9.94% | 8.90% | |||||||||
Health Care | 2.49% | 14.27% | 13.10% | |||||||||
Information Technology | 1.87% | 10.99% | 5.54% |
5 Bottom Performers – Sectors*
Fund Weighting | Russell 1000® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Utilities | –0.05% | 1.71% | 7.30% | |||||||||
Materials | 1.12% | 2.94% | 3.01% | |||||||||
Consumer Staples | 1.64% | 9.38% | 10.36% | |||||||||
Consumer Discretionary | 1.67% | 7.39% | 7.60% | |||||||||
Telecommunication Services | 1.68% | 5.83% | 5.14% |
Security contribution to performance is measured by using an algorithm that multiplies the daily performance of each security with the previous day’s ending weight in the portfolio and is gross of advisory fees. Fixed income securities and certain equity securities, such as private placements and some share classes of equity securities, are excluded. | ||
* | Based on sector classification according to the Global Industry Classification Standard codes, which are the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
Janus Value Funds | 7
Table of Contents
Perkins Large Cap Value Fund (unaudited)
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
Exxon Mobil Corp. Oil Companies – Integrated | 2.2% | |||
AT&T, Inc. Telephone – Integrated | 1.9% | |||
Pfizer, Inc. Medical – Drugs | 1.9% | |||
Vodafone Group PLC Cellular Telecommunications | 1.7% | |||
JPMorgan Chase & Co. Diversified Banking Institutions | 1.7% | |||
9.4% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30p03.gif)
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30t03.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30c03.gif)
8 | DECEMBER 31, 2010
Table of Contents
(unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30m03.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||
Fiscal | One | Since | Total Annual Fund | Net Annual Fund | |||||||
Year-to-Date | Year | Inception* | Operating Expenses | Operating Expenses | |||||||
Perkins Large Cap Value Fund – Class A Shares | |||||||||||
NAV | 20.08% | 11.94% | 18.20% | 1.32% | 1.29% | ||||||
MOP | 13.13% | 5.48% | 14.75% | ||||||||
Perkins Large Cap Value Fund – Class C Shares | |||||||||||
NAV | 19.58% | 10.97% | 17.28% | 2.09% | 2.04% | ||||||
CDSC | 18.41% | 9.89% | 17.28% | ||||||||
Perkins Large Cap Value Fund – Class D Shares(1) | 20.16% | 11.94% | 17.63% | 1.16% | 1.16% | ||||||
Perkins Large Cap Value Fund – Class I Shares | 20.23% | 12.19% | 18.49% | 1.08% | 1.04% | ||||||
Perkins Large Cap Value Fund – Class S Shares | 19.96% | 11.65% | 17.93% | 1.65% | 1.54% | ||||||
Perkins Large Cap Value Fund – Class T Shares | 20.11% | 11.97% | 17.96% | 1.29% | 1.29% | ||||||
Russell 1000® Value Index | 21.74% | 15.51% | 17.58% | ||||||||
Lipper Quartile – Class I Shares | – | 3rd | 3rd | ||||||||
Lipper Ranking – based on total returns for Large-Cap Value Funds | – | 700/1069 | 641/997 | ||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
Janus Value Funds | 9
Table of Contents
Perkins Large Cap Value Fund (unaudited)
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any performance adjustments to management fees, distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers, returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund has a performance-based management fee that adjusts up or down based on the Fund’s performance relative to an approved benchmark index over a performance measurement period. See the Fund’s Prospectus or Statement of Additional Information for more details.
The Fund’s performance may be affected by risks that include those associated with undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gains or result in losses by offsetting positive returns in other securities the Fund owns.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Due to certain investment strategies, the Fund may have an increased position in cash.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Class A Shares, Class C Shares, Class I Shares, and Class S Shares commenced operations on July 6, 2009 after the reorganization of each class of Janus Adviser Perkins Large Cap Value Fund (the “JAD predecessor fund”) into corresponding shares of the Fund. Performance shown for each class for periods prior to July 6, 2009 reflects the historical performance of each corresponding class of the JAD predecessor fund prior to the reorganization, calculated using the fees and expenses of the corresponding class of the JAD predecessor fund respectively, net of any fee and expense limitations or waivers. The performance shown for periods following the Fund’s commencement of each share class reflects the fees and expenses of each respective share class, net of any fee and expense limitations or waivers.
Class D Shares commenced operations on February 16, 2010. The performance shown for the period July 6, 2009 to December 31, 2009, reflects the performance of the Fund’s Class I Shares. Performance shown for the period prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class I Shares prior to the reorganization, calculated using the fees and expenses of Class D Shares, without the effect of any fee and expense limitations or waivers. The performance shown reflects the fees and expenses of Class D Shares, without the effect of any fee and expense limitations or waivers. If Class D Shares had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class T Shares of the Fund commenced operations on July 6, 2009. Performance shown for Class T Shares for periods prior to July 6, 2009, reflects the historical performance of the JAD predecessor fund’s Class I Shares prior to the reorganization, calculated using the fees and expenses of Class T Shares, without the effect of any fee and expense limitations or waivers. If Class T Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class T Shares reflects the fees and expenses of Class T Shares, net of any fee and expense limitations or waivers.
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class I Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
10 | DECEMBER 31, 2010
Table of Contents
(unaudited)
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The predecessor Fund’s inception date – December 31, 2008 | |
(1) | Closed to new investors. |
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,200.80 | $ | 7.27 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.60 | $ | 6.67 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,195.80 | $ | 11.40 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,014.82 | $ | 10.46 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,201.60 | $ | 6.05 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.71 | $ | 5.55 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,202.30 | $ | 5.33 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.37 | $ | 4.89 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,199.60 | $ | 8.04 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.90 | $ | 7.37 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,201.10 | $ | 6.60 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.21 | $ | 6.06 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.31% for Class A Shares, 2.06% for Class C Shares, 1.09% for Class D Shares, 0.96% for Class I Shares, 1.45% for Class S Shares and 1.19% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Value Funds | 11
Table of Contents
Perkins Large Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Common Stock – 92.5% | ||||||||||
Aerospace and Defense – 1.5% | ||||||||||
15,000 | Raytheon Co. | $ | 695,100 | |||||||
15,000 | Rockwell Collins, Inc. | 873,900 | ||||||||
1,569,000 | ||||||||||
Aerospace and Defense – Equipment – 0.8% | ||||||||||
10,000 | United Technologies Corp. | 787,200 | ||||||||
Apparel Manufacturers – 0.3% | ||||||||||
4,000 | VF Corp. | 344,720 | ||||||||
Applications Software – 1.1% | ||||||||||
40,000 | Microsoft Corp. | 1,116,800 | ||||||||
Automotive – Truck Parts and Equipment – Original – 0.4% | ||||||||||
10,000 | Johnson Controls, Inc. | 382,000 | ||||||||
Beverages – Non-Alcoholic – 1.2% | ||||||||||
4,000 | Coca-Cola Co. | 263,080 | ||||||||
14,500 | PepsiCo, Inc. | 947,285 | ||||||||
1,210,365 | ||||||||||
Brewery – 0.7% | ||||||||||
15,000 | Molson Coors Brewing Co. – Class B | 752,850 | ||||||||
Cable Television – 0.6% | ||||||||||
30,000 | Comcast Corp. – Class A | 659,100 | ||||||||
Cellular Telecommunications – 1.7% | ||||||||||
64,500 | Vodafone Group PLC | 1,704,735 | ||||||||
Chemicals – Specialty – 0.2% | ||||||||||
2,000 | Lubrizol Corp. | 213,760 | ||||||||
Commercial Banks – 1.5% | ||||||||||
29,000 | BB&T Corp. | 762,410 | ||||||||
9,000 | M&T Bank Corp. | 783,450 | ||||||||
1,545,860 | ||||||||||
Commercial Services – Finance – 1.1% | ||||||||||
60,000 | Western Union Co. | 1,114,200 | ||||||||
Computer Services – 1.6% | ||||||||||
10,600 | Accenture, Ltd. – Class A (U.S. Shares) | 513,994 | ||||||||
7,500 | International Business Machines Corp. | 1,100,700 | ||||||||
1,614,694 | ||||||||||
Computers – 0.5% | ||||||||||
12,000 | Hewlett-Packard Co. | 505,200 | ||||||||
Consumer Products – Miscellaneous – 0.5% | ||||||||||
7,800 | Kimberly-Clark Corp. | 491,712 | ||||||||
Cosmetics and Toiletries – 0.8% | ||||||||||
12,500 | Procter & Gamble Co. | 804,125 | ||||||||
Diversified Banking Institutions – 3.5% | ||||||||||
79,000 | Bank of America Corp. | 1,053,860 | ||||||||
5,000 | Goldman Sachs Group, Inc. | 840,800 | ||||||||
40,000 | JPMorgan Chase & Co. | 1,696,800 | ||||||||
3,591,460 | ||||||||||
Diversified Operations – 4.1% | ||||||||||
6,500 | 3M Co. | 560,950 | ||||||||
79,000 | General Electric Co. | 1,444,910 | ||||||||
20,800 | Illinois Tool Works, Inc. | 1,110,720 | ||||||||
25,000 | Tyco International, Ltd. (U.S. Shares) | 1,036,000 | ||||||||
4,152,580 | ||||||||||
Electric – Integrated – 2.0% | ||||||||||
16,100 | Entergy Corp. | 1,140,363 | ||||||||
33,000 | PPL Corp. | 868,560 | ||||||||
2,008,923 | ||||||||||
Electronic Components – Semiconductors – 1.4% | ||||||||||
53,000 | Intel Corp. | 1,114,590 | ||||||||
10,500 | Xilinx, Inc. | 304,290 | ||||||||
1,418,880 | ||||||||||
Electronic Forms – 0.8% | ||||||||||
26,000 | Adobe Systems, Inc.* | 800,280 | ||||||||
Engineering – Research and Development Services – 1.4% | ||||||||||
14,000 | KBR, Inc. | 426,580 | ||||||||
23,000 | URS Corp.* | 957,030 | ||||||||
1,383,610 | ||||||||||
Entertainment Software – 0.4% | ||||||||||
27,000 | Electronic Arts, Inc.* | 442,260 | ||||||||
Fiduciary Banks – 1.5% | ||||||||||
34,000 | State Street Corp. | 1,575,560 | ||||||||
Finance – Credit Card – 1.1% | ||||||||||
60,000 | Discover Financial Services | 1,111,800 | ||||||||
Finance – Investment Bankers/Brokers – 0.7% | ||||||||||
37,000 | TD Ameritrade Holding Corp. | 702,630 | ||||||||
Food – Miscellaneous/Diversified – 2.9% | ||||||||||
44,500 | ConAgra Foods, Inc. | 1,004,810 | ||||||||
14,000 | General Mills, Inc. | 498,260 | ||||||||
7,000 | Kellogg Co. | 357,560 | ||||||||
34,500 | Unilever PLC (ADR) | 1,065,360 | ||||||||
2,925,990 | ||||||||||
Food – Retail – 1.0% | ||||||||||
44,500 | Kroger Co. | 995,020 | ||||||||
Forestry – 0.7% | ||||||||||
35,000 | Weyerhaeuser Co. | 662,550 | ||||||||
Gold Mining – 1.1% | ||||||||||
24,500 | Goldcorp, Inc. (U.S. Shares) | 1,126,510 | ||||||||
Instruments – Scientific – 1.0% | ||||||||||
18,500 | Thermo Fisher Scientific, Inc.* | 1,024,160 | ||||||||
Insurance Brokers – 0.2% | ||||||||||
5,500 | AON Corp. | 253,055 | ||||||||
Internet Security – 0.7% | ||||||||||
41,000 | Symantec Corp.* | 686,340 | ||||||||
Investment Management and Advisory Services – 1.5% | ||||||||||
8,000 | Ameriprise Financial, Inc. | 460,400 | ||||||||
3,800 | Franklin Resources, Inc. | 422,598 | ||||||||
25,000 | INVESCO, Ltd. | 601,500 | ||||||||
1,484,498 | ||||||||||
Machinery – Farm – 0.5% | ||||||||||
6,000 | Deere & Co. | 498,300 | ||||||||
Medical – Biomedical and Genetic – 0.7% | ||||||||||
13,500 | Amgen, Inc.* | 741,150 | ||||||||
Medical – Drugs – 4.1% | ||||||||||
21,400 | Abbott Laboratories | 1,025,274 | ||||||||
8,500 | Eli Lilly & Co. | 297,840 |
See Notes to Schedules of Investments and Financial Statements.
12 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Medical – Drugs – (continued) | ||||||||||
16,500 | Novartis A.G. | $ | 972,675 | |||||||
107,500 | Pfizer, Inc. | 1,882,325 | ||||||||
4,178,114 | ||||||||||
Medical – HMO – 0.4% | ||||||||||
8,000 | WellPoint, Inc.* | 454,880 | ||||||||
Medical – Wholesale Drug Distributors – 0.5% | ||||||||||
7,500 | McKesson Corp. | 527,850 | ||||||||
Medical Instruments – 2.1% | ||||||||||
6,000 | Beckman Coulter, Inc. | 451,380 | ||||||||
18,500 | Medtronic, Inc. | 686,165 | ||||||||
22,500 | St. Jude Medical, Inc.* | 961,875 | ||||||||
2,099,420 | ||||||||||
Medical Labs and Testing Services – 0.7% | ||||||||||
8,000 | Laboratory Corp. of America Holdings* | 703,360 | ||||||||
Medical Products – 3.5% | ||||||||||
10,000 | Becton, Dickinson and Co. | 845,200 | ||||||||
19,000 | Covidien PLC (U.S. Shares) | 867,540 | ||||||||
18,000 | Johnson & Johnson | 1,113,300 | ||||||||
13,000 | Zimmer Holdings, Inc.* | 697,840 | ||||||||
3,523,880 | ||||||||||
Metal – Copper – 0.9% | ||||||||||
7,500 | Freeport-McMoRan Copper & Gold, Inc. – Class B | 900,675 | ||||||||
Multi-Line Insurance – 1.3% | ||||||||||
41,000 | Allstate Corp. | 1,307,080 | ||||||||
Multimedia – 1.5% | ||||||||||
33,800 | News Corp. – Class A | 492,128 | ||||||||
20,500 | Time Warner, Inc. | 659,485 | ||||||||
10,500 | Viacom, Inc. – Class B | 415,905 | ||||||||
1,567,518 | ||||||||||
Networking Products – 1.2% | ||||||||||
61,000 | Cisco Systems, Inc.* | 1,234,030 | ||||||||
Non-Hazardous Waste Disposal – 0.6% | ||||||||||
21,500 | Republic Services, Inc. | 641,990 | ||||||||
Oil – Field Services – 0.3% | ||||||||||
3,100 | Schlumberger, Ltd. (U.S. Shares) | 258,850 | ||||||||
Oil Companies – Exploration and Production – 6.7% | ||||||||||
12,000 | Anadarko Petroleum Corp. | 913,920 | ||||||||
4,100 | Apache Corp. | 488,843 | ||||||||
12,300 | Comstock Resources, Inc.* | 302,088 | ||||||||
14,000 | Devon Energy Corp. | 1,099,140 | ||||||||
11,700 | EQT Corp. | 524,628 | ||||||||
9,500 | Forest Oil Corp.* | 360,715 | ||||||||
8,000 | Noble Energy, Inc. | 688,640 | ||||||||
5,700 | Occidental Petroleum Corp. | 559,170 | ||||||||
26,000 | QEP Resources, Inc. | 944,060 | ||||||||
15,500 | Southwestern Energy Co.* | 580,165 | ||||||||
8,200 | Ultra Petroleum Corp. (U.S. Shares)* | 391,714 | ||||||||
6,853,083 | ||||||||||
Oil Companies – Integrated – 4.0% | ||||||||||
30,700 | Exxon Mobil Corp. | 2,244,784 | ||||||||
11,300 | Hess Corp. | 864,902 | ||||||||
25,000 | Marathon Oil Corp. | 925,750 | ||||||||
4,035,436 | ||||||||||
Oil Field Machinery and Equipment – 0.4% | ||||||||||
5,500 | National Oilwell Varco, Inc. | 369,875 | ||||||||
Property and Casualty Insurance – 2.0% | ||||||||||
14,000 | Chubb Corp. | 834,960 | ||||||||
23,500 | Progressive Corp. | 466,945 | ||||||||
13,500 | Travelers Cos., Inc. | 752,085 | ||||||||
2,053,990 | ||||||||||
Reinsurance – 2.6% | ||||||||||
10,000 | Berkshire Hathaway, Inc. – Class B* | 801,100 | ||||||||
9,000 | Everest Re Group, Ltd. | 763,380 | ||||||||
13,400 | PartnerRe, Ltd. | 1,076,690 | ||||||||
2,641,170 | ||||||||||
REIT – Apartments – 0.2% | ||||||||||
4,000 | Equity Residential | 207,800 | ||||||||
REIT – Regional Malls – 0.3% | ||||||||||
2,712 | Simon Property Group, Inc. | 269,817 | ||||||||
REIT – Storage – 0.3% | ||||||||||
3,000 | Public Storage | 304,260 | ||||||||
Retail – Apparel and Shoe – 0.9% | ||||||||||
40,500 | Gap, Inc. | 896,670 | ||||||||
Retail – Building Products – 0.5% | ||||||||||
22,000 | Lowe’s Cos., Inc. | 551,760 | ||||||||
Retail – Consumer Electronics – 0.6% | ||||||||||
18,000 | Best Buy Co., Inc. | 617,220 | ||||||||
Retail – Discount – 1.6% | ||||||||||
6,200 | Target Corp. | 372,806 | ||||||||
22,600 | Wal-Mart Stores, Inc. | 1,218,818 | ||||||||
1,591,624 | ||||||||||
Retail – Drug Store – 1.0% | ||||||||||
30,000 | CVS Caremark Corp. | 1,043,100 | ||||||||
Retail – Major Department Stores – 0.4% | ||||||||||
9,000 | TJX Cos., Inc. | 399,510 | ||||||||
Retail – Regional Department Stores – 0.8% | ||||||||||
14,500 | Kohl’s Corp.* | 787,930 | ||||||||
Retail – Restaurants – 0.5% | ||||||||||
7,000 | McDonald’s Corp. | 537,320 | ||||||||
Savings/Loan/Thrifts – 0.4% | ||||||||||
28,000 | People’s United Financial, Inc. | 392,280 | ||||||||
Semiconductor Equipment – 0.7% | ||||||||||
48,400 | Applied Materials, Inc. | 680,020 | ||||||||
Super-Regional Banks – 4.4% | ||||||||||
24,500 | PNC Financial Services Group, Inc. | 1,487,640 | ||||||||
56,000 | U.S. Bancorp. | 1,510,320 | ||||||||
47,000 | Wells Fargo & Co. | 1,456,530 | ||||||||
4,454,490 | ||||||||||
Telephone – Integrated – 3.4% | ||||||||||
66,000 | AT&T, Inc. | 1,939,080 | ||||||||
16,000 | CenturyLink, Inc. | 738,720 | ||||||||
21,500 | Verizon Communications, Inc. | 769,270 | ||||||||
3,447,070 | ||||||||||
Tobacco – 0.3% | ||||||||||
4,500 | Philip Morris International, Inc. | 263,385 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 13
Table of Contents
Perkins Large Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Transportation – Railroad – 0.7% | ||||||||||
12,000 | Kansas City Southern* | $ | 574,320 | |||||||
1,900 | Union Pacific Corp. | 176,054 | ||||||||
750,374 | ||||||||||
Wireless Equipment – 0.3% | ||||||||||
6,700 | QUALCOMM, Inc. | 331,583 | ||||||||
X-Ray Equipment – 0.7% | ||||||||||
39,000 | Hologic, Inc.* | 733,980 | ||||||||
Total Common Stock (cost $81,877,875) | 94,013,271 | |||||||||
Repurchase Agreement – 9.8% | ||||||||||
$9,944,000 | ING Financial Markets LLC, 0.0800% dated 12/31/10, maturing 1/3/11 to be repurchased at $9,944,066 collateralized by $10,086,360 in U.S. Treasuries 0.0000%-3.3750%, 3/10/11-4/15/32 with a value of $9,944,000 (cost $9,944,000) | 9,944,000 | ||||||||
Total Investments (total cost $91,821,875) – 102.3% | 103,957,271 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (2.3)% | (2,297,623) | |||||||||
Net Assets – 100% | $ | 101,659,648 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Bermuda | $ | 2,441,570 | 2.3% | |||||
Canada | 1,518,224 | 1.5% | ||||||
Ireland | 1,381,534 | 1.3% | ||||||
Netherlands Antilles | 258,850 | 0.3% | ||||||
Switzerland | 2,008,675 | 1.9% | ||||||
United Kingdom | 2,770,095 | 2.7% | ||||||
United States†† | 93,578,323 | 90.0% | ||||||
Total | $ | 103,957,271 | 100.0% |
†† | Includes Cash Equivalents (80.5% excluding Cash Equivalents). Cash equivalents include investments in overnight repurchase agreements. |
See Notes to Schedules of Investments and Financial Statements.
14 | DECEMBER 31, 2010
Table of Contents
Perkins Mid Cap Value Fund (unaudited)(closed to new investors)
Fund Snapshot This Fund seeks to uncover what the portfolio managers believe are fundamentally and financially strong mid-sized companies exhibiting favorable risk-reward characteristics. | Managed by Perkins Investment Management LLC |
Performance Overview
During the six months ended December 31, 2010, Perkins Mid Cap Value Fund’s Class T Shares returned 19.27%, underperforming the Fund’s benchmark, the Russell Midcap Value Index, which returned 25.86%.
Economic Environment
The overall U.S. equity market, as represented by the S&P 500 index returned 23.27% for the period amid improving economic data and the Federal Reserve’s (Fed) second round of quantitative easing (QE2). As we are at least as focused on absolute returns as we are relative returns, we are pleased with the Fund’s results despite the underperformance. In the past because of our risk sensitive approach to investing, we have sometimes underperformed strong markets while losing less in down markets. Over their 12 year history, the Fund’s Class T Shares have had an annualized return of 13.00% compared to the Russell Midcap Value’s 8.47% and the S&P 500’s 3.01%. Although the short-term performance was respectable, we pride ourselves on the long term outperformance. Our emphasis on determining the potential downside or risk of an opportunity has served us well in down markets and has worked well for us over three decades.
Investment Approach, Performance and Positioning
Our cash weighting hurt relative returns as did, to a lesser extent, our small investment in index put options. In an attempt to minimize downside risk in a period of unusual economic uncertainty and risk, the Fund used relatively small positions in put options on the Russell Midcap Value Index. Given the market’s strength these positions proved to be a drag on relative results. (Please see the “Notes to Financial Statements” for a discussion of derivatives used by the Fund.) Our stock selection was negative in consumer discretionary, energy (though offset some by our overweight exposure), and health care. Conversely, our names within the materials and our underweight in utilities helped relative returns.
Our industry weightings have not changed much. We continue to be overweight health care, which had significantly underperformed until the elections. With the possibility of some change in health care policy, these relatively cheap stocks have rebounded, yet remain below their past valuations. The pickup in takeover activity has benefited our portfolios and could be a positive next year as well. We continue to find more value opportunities within larger capitalization stocks than those at the smaller end of the spectrum. While larger caps generally underperformed in 2010 it is interesting that some of our top contributors listed below are large caps, part or all of which were purchased this year after they had underperformed. We think in many cases larger cap issues not only sell at below average valuations, but also have strong balance sheets, healthy cash flows, growing dividends, and the financial flexibility that should provide good downside support during periods of uncertainty. We expect volatility will be at above average levels which should provide us with opportunities to advantageously purchase good long term values. Thus while we are uncertain about the market outlook, we believe we are well positioned to provide competitive returns going forward.
Holdings That Contributed to Performance
Within materials, copper producer Freeport-McMoRan rebounded off mid-year depressed levels to lead among contributors. We significantly increased our position in that period of weakness. Like many commodity prices, copper continued its trend higher given emerging market demand, particularly from China. Freeport benefited as it is one of the few direct plays. The company is a low cost producer, has a solid balance sheet and robust free cash flow in our view. We pared back the position on strength as the stock’s risk/reward became less favorable.
The energy sector was the best performing for the period as commodity prices have continued to head higher. Service stocks, like National Oilwell Varco have rebounded from depressed levels (at which point we significantly increased our holding) related to the summer’s Gulf of Mexico oil disaster in our view. Despite the stock’s strong free cash flow generation and healthy balance sheet, we have reduced our position on the rally as the risk/reward has become less attractive to us.
Financial services company Ameriprise Financial rallied as the company had been selling close to book value and at 10x earnings. Fund flows and expense cuts appear to be
Janus Value Funds | 15
Table of Contents
Perkins Mid Cap Value Fund (unaudited)(closed to new investors)
on track, and the P/E multiple has been expanded as the company is viewed more as an asset manager than a life insurance company. In addition, the balance sheet is comprised of high quality investments in our view.
Holdings That Detracted from Performance
H&R Block, Inc., a provider of tax, banking and consulting services, struggled as it dealt with management turnover and concerns it may be on the hook to repurchase some subprime mortgages tied to its mortgage division, which was sold in 2008. We exited our small position in the name as we became increasingly uncomfortable with the company’s potential risk.
Within energy, natural gas producer Comstock Resources, Inc. underperformed due to rising costs and their lack of any hedging, thus 100% exposure to volatile spot natural gas prices. We continue to like the name longer term based on an improving, albeit slowly, outlook for natural gas demand and what we consider to be an attractive risk/reward tradeoff.
Technology bellwether Cisco Systems underperformed as cuts in government IT purchases impacted sales. We added to our holding as the company has historically been a leader in its field, has $4 per share of net cash on its balance sheet, sells at a price-to-earnings (P/E) multiple of around 12x, and because it should benefit from a rebound in corporate technology spending. (P/E measures the amount investors pay via the stock price for a dollar per share of a company’s earnings).
Market Outlook
After having disappointing growth in the middle of the year, the economy has shown signs of reaccelerating. Average forecasts of real Gross Domestic Product (GDP) growth in 2011 have moved up from the 2.5% area to 3.0-3.5%. This is the result of the Fed announcing a second phase of monetary easing (QE2) and, most recently, a two year extension of the Bush tax cuts. While these measures will likely be stimulative in the near term, it is debatable as to whether they will have a longer lasting significantly constructive impact. The more optimistic view would be that these measures foster increased consumer and business confidence and build a sustained economic momentum. Additionally in the aftermath of the November elections, Congress and the Administration are likely to be more business friendly. Some observers are making the case that this is indicative of a sea change in policy. While we are hopeful, we do not make investments on hope. Regarding policy we remain skeptical. Most politicians tend to be overly partisan and have had difficulty squarely addressing problems that require sacrifice by their constituents. In the meantime, we continue to believe that Fed policy is an aggressive experiment and it is unclear how it will be unwound. Governmental deficits are unsustainable in many parts of the globe, and state and local budgets represent over 10% of the economy. Unemployment is likely to remain high and housing could continue to be weak.
One of the stated goals of QE2 is to pump up the stock market which creates wealth and confidence that could stimulate the economy. On that score to date, the Fed has been successful as the stock market has had a strong response to the prospect of QE2, the election and tax compromise. Earnings growth has been above expectations and earnings of the S&P 500 Index should be about $85 per share for 2010. With the stronger economy, further gains could put the S&P’s net earnings at $95 per share in 2011. Thus we believe stocks are selling at a reasonable 13x expected 2011 earnings. Even with the yield on 10-year Treasuries having backed up to almost 3.5%, stocks offer attractive relative value in our opinion. In fact in recent weeks, bond funds have experienced outflows and stock funds have had net inflows, a reversal of the strong trend that has been a major headwind for stocks. Thus we enter 2011 with very positive investor consensus and equity market momentum which could continue over the near term.
Balancing these positives are the longer term challenges of deficits, deleveraging, and international economic and political imbalances. Thus, we continue to agree with Fed Chairman Bernanke when he stated that the outlook is “unusually uncertain.” Valuations could be restrained by the unlikely sustainability of monetary and fiscal policies that are temporarily supporting the economy. The duration of this “easy money” could be in doubt given the inflationary pressures seen in a broad range of commodities, from oil to cotton, during 2010.
Given the lack of longer term clarity, as has been the case historically, we are focused much more on individual company fundamentals than the macro environment. In a potentially volatile market, we believe that our emphasis on strong balance sheets, free cash flow and below average valuations is especially appropriate. And the uncertainty of our economic outlook leads us in many cases to have company earnings estimates that are below consensus. This fits well with our standard sensitivity to risk. This approach is reflected not only in our long term results, but also very clearly in our most recent three year returns. While we underperformed in 2010, we suffered relatively less in the 2008 market debacle. The result is that we have had positive returns for the three-year period
16 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
which are significantly better than most indexes, some of which have negative results for the period. We think this is graphic evidence that it is more important how a portfolio does in down markets than how it performs in up markets. This is also why we tend to be focused at least as much on absolute returns as we do on relative returns. We have underperformed in past years, most notably in 2004-2006 when our double digit positive returns lagged those of the Fund’s benchmark. But underperformance such as that does not inhibit the power of compounding as much as severe losses. Thus, despite those years of upside underperformance, our outperformance in down markets has allowed us to have an average annualized return of 9.89% in the past decade compared to 8.07% for the Russell Midcap Value Index and 1.41% for the S&P 500.
Thank you for your investment in Perkins Mid Cap Value Fund.
Perkins Mid Cap Value Fund At A Glance
5 Top Performers – Holdings
Contribution | ||||
Freeport-McMoRan Copper & Gold, Inc. – Class B | 0.99% | |||
National Oilwell Varco, Inc. | 0.64% | |||
Ameriprise Financial, Inc. | 0.62% | |||
Hess Corp. | 0.55% | |||
INVESCO, Ltd. | 0.48% |
5 Bottom Performers – Holdings
Contribution | ||||
iShares Russell Midcap® Value Index Fund – Put expired October 2010 exercise price $39.82 | –0.14% | |||
iShares Russell 2000® Index Fund – Put expired December 2010 exercise price $69.07 | –0.12% | |||
iShares Russell 2000® Index Fund – Put expired December 2010 exercise price $66.00 | –0.11% | |||
iShares Russell Midcap® Value Index Fund – Put expired November 2010 exercise price $40.93 | –0.11% | |||
iShares Russell Midcap® Value Index Fund – Put expired October 2010 exercise price $41.00 | –0.11% |
5 Top Performers – Sectors*
Fund Weighting | Russell Midcap® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Financials | 4.72% | 23.59% | 29.46% | |||||||||
Energy | 4.00% | 11.52% | 10.62% | |||||||||
Industrials | 3.19% | 11.99% | 10.15% | |||||||||
Health Care | 2.96% | 13.07% | 5.23% | |||||||||
Consumer Discretionary | 2.63% | 10.97% | 10.69% |
5 Bottom Performers – Sectors*
Fund Weighting | Russell Midcap® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Utilities | –0.03% | 1.71% | 12.72% | |||||||||
Telecommunication Services | 0.63% | 1.96% | 2.11% | |||||||||
Consumer Staples | 1.44% | 8.32% | 7.19% | |||||||||
Materials | 2.08% | 5.80% | 5.40% | |||||||||
Information Technology | 2.61% | 12.28% | 6.44% |
Security contribution to performance is measured by using an algorithm that multiplies the daily performance of each security with the previous day’s ending weight in the portfolio and is gross of advisory fees. Fixed income securities and certain equity securities, such as private placements and some share classes of equity securities, are excluded. | ||
* | Based on sector classification according to the Global Industry Classification Standard codes, which are the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
Janus Value Funds | 17
Table of Contents
Perkins Mid Cap Value Fund (unaudited)(closed to new investors)
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
State Street Corp. Fiduciary Banks | 1.4% | |||
URS Corp. Engineering – Research and Development Services | 1.3% | |||
PartnerRe, Ltd. Reinsurance | 1.3% | |||
QEP Resources, Inc. Oil Companies – Exploration and Production | 1.3% | |||
Goldcorp, Inc. (U.S. Shares) Gold Mining | 1.2% | |||
6.5% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30p01.gif)
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30t01.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30c01.gif)
18 | DECEMBER 31, 2010
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(unaudited)(closed to new investors)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30m01.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||||
Fiscal | One | Five | Ten | Since | Total Annual Fund | Net Annual Fund | |||||||||
Year-to-Date | Year | Year | Year | Inception* | Operating Expenses | Operating Expenses | |||||||||
Perkins Mid Cap Value Fund – Class A Shares(1) | |||||||||||||||
NAV | 19.23% | 14.65% | 5.92% | 9.71% | 12.86% | 1.17% | 1.17% | ||||||||
MOP | 12.38% | 8.05% | 4.68% | 9.06% | 12.32% | ||||||||||
Perkins Mid Cap Value Fund – Class C Shares(1) | |||||||||||||||
NAV | 18.72% | 13.80% | 5.16% | 8.93% | 12.15% | 1.91% | 1.91% | ||||||||
CDSC | 17.54% | 12.66% | 5.16% | 8.93% | 12.15% | ||||||||||
Perkins Mid Cap Value Fund – Class D Shares(1) | 19.37% | 14.91% | 6.15% | 9.90% | 13.01% | 0.91% | 0.91% | ||||||||
Perkins Mid Cap Value Fund – Class I Shares(1) | 19.42% | 15.02% | 6.13% | 9.89% | 13.00% | 0.83% | 0.83% | ||||||||
Perkins Mid Cap Value Fund – Class L Shares(1) | 19.39% | 15.01% | 6.33% | 10.08% | 13.16% | 1.00% | 1.00% | ||||||||
Perkins Mid Cap Value Fund – Class R Shares(1) | 18.99% | 14.24% | 5.54% | 9.31% | 12.53% | 1.52% | 1.52% | ||||||||
Perkins Mid Cap Value Fund – Class S Shares(1) | 19.10% | 14.52% | 5.80% | 9.58% | 12.75% | 1.27% | 1.27% | ||||||||
Perkins Mid Cap Value Fund – Class T Shares(1) | 19.27% | 14.81% | 6.13% | 9.89% | 13.00% | 1.02% | 1.02% | ||||||||
Russell Midcap® Value Index | 25.86% | 24.75% | 4.08% | 8.07% | 8.47% | ||||||||||
Lipper Quartile – Class T Shares | – | 4th | 1st | 1st | 1st | ||||||||||
Lipper Ranking – based on total returns for Mid-Cap Value Funds | – | 157/167 | 16/114 | 5/44 | 2/34 | ||||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||||
See important disclosures on the next page.
Janus Value Funds | 19
Table of Contents
Perkins Mid Cap Value Fund (unaudited)(closed to new investors)
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any performance adjustments to management fees, distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, Class R Share and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class L Shares, Class R Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers returns would have been lower.
Janus Services LLC has agreed to waive all or a portion of the administrative fee applicable to the Fund’s Class L Shares. Such waiver is voluntary and could change or be terminated at any time at the discretion of Janus Services LLC or Janus Capital without prior notification to shareholders. Total returns shown include fee waivers, if any, and without such waivers, the total returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund has a performance-based management fee that adjusts up or down based on the Fund’s performance relative to an approved benchmark index over a performance measurement period. See the Fund’s Prospectus or Statement of Additional Information for more details.
The Fund’s performance may be affected by risks that include those associated with undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), and derivatives. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gains or result in losses by offsetting positive returns in other securities the Fund owns.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Effective February 16, 2010, Perkins Mid Cap Value Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class R Shares and Class S Shares of the Fund commenced operations on July 6, 2009. The performance shown for each class reflects the performance of the Fund’s Class J Shares (formerly named Investor Shares), from April 21, 2003 to July 6, 2009, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. For periods prior to April 21, 2003, the performance shown for each class reflects the historical performance of Berger Mid Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Mid Cap Value Fund – Investor Shares into the Fund’s former Class J Shares), calculated using the fees and expenses of each respective share class, without the effect of any fee and expense limitations or waivers. If each share class of the Fund had been
20 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
available during periods prior to July 6, 2009, the performance shown for each respective share class may have been different. The performance shown for periods following the Fund’s commencement of each class reflects the fees and expenses of each respective class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares (formerly named Investor Shares). For the periods prior to April 21, 2003, the performance shown for Class D Shares reflects the historical performance of Berger Mid Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Mid Cap Value Fund – Investor Shares into the Fund’s Class J Shares). If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares of the Fund commenced operations on July 6, 2009. The performance shown for Class I Shares reflects the performance of the Fund’s Class J Shares (formerly named Investor Shares) from April 21, 2003 to July 6, 2009, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. For the periods prior to April 21, 2003, the performance shown for Class I Shares reflects the historical performance of Berger Mid Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Mid Cap Value Fund – Investor Shares into the Fund’s former Class J Shares), calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
The performance shown for Class L Shares for periods following April 21, 2003, reflects the fees and expenses of Class L Shares (formerly named Institutional Shares), net of any fee and expense limitations or waivers. The performance shown for Class L Shares for the periods from May 17, 2002 to April 17, 2003, reflects the historical performance of Berger Mid Cap Value Fund — Institutional Shares (as a result of a prior reorganization of Berger Mid Cap Value Fund – Institutional Shares into the Fund’s Class L Shares). For the periods prior to May 17, 2002, the performance shown reflects the historical performance of Berger Mid Cap Value Fund – Investor Shares.
The performance shown for Class T Shares for periods following April 21, 2003, reflects the fees and expenses of Class T Shares (formerly named Class J Shares) in effect during the periods shown, net of any fee and expense limitations or waivers. For the periods prior to April 21, 2003, the performance shown for Class T Shares reflects the historical performance of Berger Mid Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Mid Cap Value Fund – Investor Shares into the Fund’s Class J Shares).
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
August 13, 1998 is the date used to calculate the since-inception Lipper ranking, which is slightly different from when the Fund began operations since Lipper provides fund rankings as of the last day of the month or the first Thursday after fund inception.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The predecessor Fund’s inception date – August 12, 1998 | |
(1) | Effective December 31, 2010, Perkins Mid Cap Value Fund is closed to certain new investors. Please see current prospectus for details. |
Janus Value Funds | 21
Table of Contents
Perkins Mid Cap Value Fund (unaudited)(closed to new investors)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,192.30 | $ | 6.47 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.31 | $ | 5.96 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,187.20 | $ | 10.47 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,015.63 | $ | 9.65 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,193.70 | $ | 5.14 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.52 | $ | 4.73 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,194.20 | $ | 4.76 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.87 | $ | 4.38 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class L Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,195.00 | $ | 4.26 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,021.32 | $ | 3.92 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class R Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,189.90 | $ | 8.45 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.49 | $ | 7.78 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,191.50 | $ | 7.07 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.75 | $ | 6.51 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,192.70 | $ | 5.69 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.01 | $ | 5.24 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.17% for Class A Shares, 1.90% for Class C Shares, 0.93% for Class D Shares, 0.86% for Class I Shares, 0.77% for Class L Shares, 1.53% for Class R Shares, 1.28% for Class S Shares and 1.03% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
22 | DECEMBER 31, 2010
Table of Contents
Perkins Mid Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares/Principal/Contract Amounts | Value | |||||||||
Common Stock – 91.3% | ||||||||||
Aerospace and Defense – 0.7% | ||||||||||
1,750,000 | Rockwell Collins, Inc. | $ | 101,955,000 | |||||||
Apparel Manufacturers – 0.7% | ||||||||||
4,000,000 | Jones Apparel Group, Inc. | 62,160,000 | ||||||||
400,000 | VF Corp. | 34,472,000 | ||||||||
96,632,000 | ||||||||||
Appliances – 0.3% | ||||||||||
500,000 | Whirlpool Corp. | 44,415,000 | ||||||||
Automotive – Truck Parts and Equipment – Original – 0.3% | ||||||||||
941,942 | Johnson Controls, Inc. | 35,982,184 | ||||||||
Brewery – 0.9% | ||||||||||
2,550,000 | Molson Coors Brewing Co. – Class B | 127,984,500 | ||||||||
Building – Residential and Commercial – 1.0% | ||||||||||
3,700,000 | KB Home | 49,913,000 | ||||||||
1,000,000 | Lennar Corp. – Class A | 18,750,000 | ||||||||
2,000,270 | M.D.C. Holdings, Inc. | 57,547,768 | ||||||||
1,100,000 | Ryland Group, Inc. | 18,733,000 | ||||||||
144,943,768 | ||||||||||
Cable Television – 0.2% | ||||||||||
1,233,000 | Comcast Corp. – Class A | 27,089,010 | ||||||||
Cellular Telecommunications – 0.8% | ||||||||||
4,400,485 | Vodafone Group PLC | 116,304,819 | ||||||||
Chemicals – Diversified – 0.5% | ||||||||||
850,571 | FMC Corp. | 67,952,117 | ||||||||
Chemicals – Specialty – 0.4% | ||||||||||
500,000 | Lubrizol Corp. | 53,440,000 | ||||||||
Commercial Banks – 1.9% | ||||||||||
1,500,000 | BB&T Corp. | 39,435,000 | ||||||||
317,134 | First Republic Bank* | 9,234,942 | ||||||||
1,500,075 | M&T Bank Corp. | 130,581,529 | ||||||||
5,400,000 | TCF Financial Corp. | 79,974,000 | ||||||||
259,225,471 | ||||||||||
Commercial Services – Finance – 2.0% | ||||||||||
2,700,000 | Global Payments, Inc. | 124,767,000 | ||||||||
8,300,000 | Western Union Co. | 154,131,000 | ||||||||
278,898,000 | ||||||||||
Computer Services – 0.7% | ||||||||||
950,000 | Accenture, Ltd. – Class A (U.S. Shares) | 46,065,500 | ||||||||
2,600,000 | SRA International, Inc.*,£ | 53,170,000 | ||||||||
99,235,500 | ||||||||||
Computers – 0.4% | ||||||||||
1,250,500 | Hewlett-Packard Co. | 52,646,050 | ||||||||
Computers – Integrated Systems – 0.9% | ||||||||||
2,500,000 | Diebold, Inc. | 80,125,000 | ||||||||
1,700,000 | Jack Henry & Associates, Inc. | 49,555,000 | ||||||||
129,680,000 | ||||||||||
Consumer Products – Miscellaneous – 0.2% | ||||||||||
550,000 | Kimberly-Clark Corp. | 34,672,000 | ||||||||
Containers – Metal and Glass – 0.4% | ||||||||||
900,000 | Ball Corp. | 61,245,000 | ||||||||
Containers – Paper and Plastic – 0.6% | ||||||||||
1,911,055 | Packaging Corp. of America | 49,381,661 | ||||||||
1,600,242 | Temple-Inland, Inc. | 33,989,140 | ||||||||
83,370,801 | ||||||||||
Diagnostic Equipment – 0.5% | ||||||||||
3,200,320 | Immucor, Inc.* | 63,462,346 | ||||||||
Diversified Operations – 1.4% | ||||||||||
1,400,000 | Carlisle Cos., Inc. | 55,636,000 | ||||||||
3,400,567 | Tyco International, Ltd. (U.S. Shares) | 140,919,496 | ||||||||
196,555,496 | ||||||||||
Electric – Integrated – 1.8% | ||||||||||
1,200,000 | Constellation Energy Group, Inc. | 36,756,000 | ||||||||
1,501,900 | Entergy Corp. | 106,379,577 | ||||||||
4,100,000 | PPL Corp. | 107,912,000 | ||||||||
251,047,577 | ||||||||||
Electronic Components – Miscellaneous – 0.7% | ||||||||||
3,000,000 | Garmin, Ltd. | 92,970,000 | ||||||||
Electronic Components – Semiconductors – 2.4% | ||||||||||
3,600,000 | Intel Corp. | 75,708,000 | ||||||||
4,800,000 | Intersil Corp. – Class A£ | 73,296,000 | ||||||||
4,500,200 | QLogic Corp.* | 76,593,404 | ||||||||
2,200,000 | Semtech Corp.*,£ | 49,808,000 | ||||||||
1,900,260 | Xilinx, Inc. | 55,069,535 | ||||||||
330,474,939 | ||||||||||
Electronic Connectors – 0.5% | ||||||||||
1,500,000 | Thomas & Betts Corp.* | 72,450,000 | ||||||||
Electronic Forms – 0.7% | ||||||||||
3,000,000 | Adobe Systems, Inc.* | 92,340,000 | ||||||||
Electronic Parts Distributors – 0.8% | ||||||||||
2,550,000 | Tech Data Corp.*,£ | 112,251,000 | ||||||||
Engineering – Research and Development Services – 2.6% | ||||||||||
2,350,000 | Jacobs Engineering Group, Inc.* | 107,747,500 | ||||||||
2,800,000 | KBR, Inc. | 85,316,000 | ||||||||
4,250,000 | URS Corp.*,£ | 176,842,500 | ||||||||
369,906,000 | ||||||||||
Entertainment Software – 0.3% | ||||||||||
3,000,000 | Electronic Arts, Inc.* | 49,140,000 | ||||||||
Fiduciary Banks – 1.4% | ||||||||||
4,200,000 | State Street Corp. | 194,628,000 | ||||||||
Finance – Credit Card – 1.1% | ||||||||||
8,600,000 | Discover Financial Services | 159,358,000 | ||||||||
Finance – Investment Bankers/Brokers – 1.2% | ||||||||||
2,100,212 | Raymond James Financial, Inc. | 68,676,932 | ||||||||
5,300,230 | TD Ameritrade Holding Corp. | 100,651,368 | ||||||||
169,328,300 | ||||||||||
Food – Baking – 0.7% | ||||||||||
3,800,000 | Flowers Foods, Inc. | 102,258,000 | ||||||||
Food – Miscellaneous/Diversified – 2.4% | ||||||||||
5,500,000 | ConAgra Foods, Inc. | 124,190,000 | ||||||||
1,050,000 | General Mills, Inc. | 37,369,500 | ||||||||
1,173,100 | Kellogg Co. | 59,921,948 | ||||||||
3,600,000 | Unilever PLC (ADR) | 111,168,000 | ||||||||
332,649,448 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 23
Table of Contents
Perkins Mid Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares/Principal/Contract Amounts | Value | |||||||||
Food – Retail – 1.1% | ||||||||||
6,600,000 | Kroger Co. | $ | 147,576,000 | |||||||
Footwear and Related Apparel – 0.3% | ||||||||||
1,900,795 | Skechers U.S.A., Inc. – Class A*,£ | 38,015,900 | ||||||||
Forestry – 1.1% | ||||||||||
2,000,300 | Potlatch Corp.£ | 65,109,765 | ||||||||
4,553,793 | Weyerhaeuser Co. | 86,203,302 | ||||||||
151,313,067 | ||||||||||
Gas – Distribution – 0.4% | ||||||||||
1,400,000 | AGL Resources, Inc. | 50,190,000 | ||||||||
Gold Mining – 1.2% | ||||||||||
3,700,000 | Goldcorp, Inc. (U.S. Shares) | 170,126,000 | ||||||||
Instruments – Scientific – 1.6% | ||||||||||
3,800,000 | PerkinElmer, Inc. | 98,116,000 | ||||||||
2,150,000 | Thermo Fisher Scientific, Inc.* | 119,024,000 | ||||||||
217,140,000 | ||||||||||
Internet Security – 0.8% | ||||||||||
6,500,000 | Symantec Corp.* | 108,810,000 | ||||||||
Investment Management and Advisory Services – 1.2% | ||||||||||
1,200,000 | AllianceBernstein Holding L.P. | 27,996,000 | ||||||||
900,000 | Ameriprise Financial, Inc. | 51,795,000 | ||||||||
3,700,030 | INVESCO, Ltd. | 89,022,722 | ||||||||
168,813,722 | ||||||||||
Machinery – Farm – 0.7% | ||||||||||
1,250,000 | Deere & Co. | 103,812,500 | ||||||||
Machinery – General Industrial – 0.3% | ||||||||||
1,450,000 | Babcock & Wilcox Co.* | 37,105,500 | ||||||||
Medical – Biomedical and Genetic – 2.0% | ||||||||||
2,900,000 | Charles River Laboratories International, Inc.*,£ | 103,066,000 | ||||||||
300,000 | Genzyme Corp.* | 21,360,000 | ||||||||
1,850,000 | Life Technologies Corp.* | 102,675,000 | ||||||||
2,200,000 | Myriad Genetics, Inc.* | 50,248,000 | ||||||||
277,349,000 | ||||||||||
Medical – Drugs – 1.3% | ||||||||||
2,700,000 | Forest Laboratories, Inc.* | 86,346,000 | ||||||||
1,600,000 | Novartis A.G. | 94,320,000 | ||||||||
180,666,000 | ||||||||||
Medical – HMO – 0.1% | ||||||||||
700,000 | Health Net, Inc.* | 19,103,000 | ||||||||
Medical – Wholesale Drug Distributors – 0.4% | ||||||||||
850,000 | McKesson Corp. | 59,823,000 | ||||||||
Medical Instruments – 1.3% | ||||||||||
850,000 | Beckman Coulter, Inc. | 63,945,500 | ||||||||
2,850,000 | St. Jude Medical, Inc.* | 121,837,500 | ||||||||
185,783,000 | ||||||||||
Medical Labs and Testing Services – 1.6% | ||||||||||
1,700,000 | Covance, Inc.* | 87,397,000 | ||||||||
1,500,000 | Laboratory Corp. of America Holdings* | 131,880,000 | ||||||||
219,277,000 | ||||||||||
Medical Products – 2.2% | ||||||||||
1,150,400 | Becton, Dickinson and Co. | 97,231,808 | ||||||||
2,300,000 | Covidien PLC (U.S. Shares) | 105,018,000 | ||||||||
1,950,000 | Zimmer Holdings, Inc.* | 104,676,000 | ||||||||
306,925,808 | ||||||||||
Medical Sterilization Products – 0.3% | ||||||||||
1,000,000 | STERIS Corp. | 36,460,000 | ||||||||
Metal – Copper – 0.9% | ||||||||||
1,050,000 | Freeport-McMoRan Copper & Gold, Inc. – Class B | 126,094,500 | ||||||||
Metal Processors and Fabricators – 0.5% | ||||||||||
1,600,000 | Kaydon Corp. | 65,152,000 | ||||||||
Multi-Line Insurance – 1.4% | ||||||||||
4,600,600 | Allstate Corp. | 146,667,128 | ||||||||
3,800,000 | Old Republic International Corp. | 51,794,000 | ||||||||
198,461,128 | ||||||||||
Multimedia – 0.6% | ||||||||||
2,200,000 | Viacom, Inc. – Class B | 87,142,000 | ||||||||
Networking Products – 1.0% | ||||||||||
6,600,800 | Cisco Systems, Inc.* | 133,534,184 | ||||||||
Non-Hazardous Waste Disposal – 0.8% | ||||||||||
3,800,000 | Republic Services, Inc. | 113,468,000 | ||||||||
Oil Companies – Exploration and Production – 8.0% | ||||||||||
1,400,000 | Anadarko Petroleum Corp. | 106,624,000 | ||||||||
1,700,000 | Bill Barrett Corp.* | 69,921,000 | ||||||||
2,300,000 | Cabot Oil & Gas Corp. | 87,055,000 | ||||||||
2,500,000 | Comstock Resources, Inc.*,£ | 61,400,000 | ||||||||
1,400,000 | Devon Energy Corp. | 109,914,000 | ||||||||
2,900,000 | EQT Corp. | 130,036,000 | ||||||||
3,000,000 | Forest Oil Corp.* | 113,910,000 | ||||||||
1,200,000 | Noble Energy, Inc. | 103,296,000 | ||||||||
4,800,000 | QEP Resources, Inc. | 174,288,000 | ||||||||
2,420,000 | Southwestern Energy Co.* | 90,580,600 | ||||||||
1,500,000 | Ultra Petroleum Corp. (U.S. Shares)* | 71,655,000 | ||||||||
1,118,679,600 | ||||||||||
Oil Companies – Integrated – 0.8% | ||||||||||
1,400,000 | Hess Corp. | 107,156,000 | ||||||||
Oil Field Machinery and Equipment – 0.4% | ||||||||||
800,000 | National Oilwell Varco, Inc. | 53,800,000 | ||||||||
Paper and Related Products – 0.3% | ||||||||||
800,000 | Rayonier, Inc. | 42,016,000 | ||||||||
Pharmacy Services – 0.5% | ||||||||||
2,900,000 | Omnicare, Inc. | 73,631,000 | ||||||||
Pipelines – 1.1% | ||||||||||
1,026,890 | Enterprise Products Partners L.P. | 42,728,893 | ||||||||
1,800,000 | Plains All American Pipeline L.P. | 113,022,000 | ||||||||
155,750,893 | ||||||||||
Property and Casualty Insurance – 1.2% | ||||||||||
600,000 | Chubb Corp. | 35,784,000 | ||||||||
2,500,000 | HCC Insurance Holdings, Inc. | 72,350,000 | ||||||||
3,300,000 | Progressive Corp. | 65,571,000 | ||||||||
173,705,000 |
See Notes to Schedules of Investments and Financial Statements.
24 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares/Principal/Contract Amounts | Value | |||||||||
Reinsurance – 2.6% | ||||||||||
600,000 | Berkshire Hathaway, Inc. – Class B* | $ | 48,066,000 | |||||||
1,700,000 | Everest Re Group, Ltd. | 144,194,000 | ||||||||
2,200,000 | PartnerRe, Ltd. | 176,770,000 | ||||||||
369,030,000 | ||||||||||
REIT – Apartments – 0.6% | ||||||||||
300,000 | Avalonbay Communities, Inc. | 33,765,000 | ||||||||
1,200,000 | BRE Properties, Inc. – Class A | 52,200,000 | ||||||||
85,965,000 | ||||||||||
REIT – Diversified – 0.5% | ||||||||||
2,000,120 | Liberty Property Trust | 63,843,830 | ||||||||
REIT – Health Care – 0.8% | ||||||||||
2,900,310 | Nationwide Health Properties, Inc. | 105,513,278 | ||||||||
REIT – Mortgage – 0.6% | ||||||||||
2,000,000 | Annaly Mortgage Management, Inc. | 35,840,000 | ||||||||
3,200,000 | Redwood Trust, Inc. | 47,776,000 | ||||||||
83,616,000 | ||||||||||
REIT – Office Property – 1.6% | ||||||||||
850,244 | Alexandria Real Estate Equities, Inc. | 62,288,875 | ||||||||
700,000 | Boston Properties, Inc. | 60,270,000 | ||||||||
800,000 | Corporate Office Properties | 27,960,000 | ||||||||
2,400,000 | Mack-Cali Realty Corp. | 79,344,000 | ||||||||
229,862,875 | ||||||||||
REIT – Regional Malls – 0.3% | ||||||||||
800,000 | Taubman Centers, Inc. | 40,384,000 | ||||||||
REIT – Storage – 0.4% | ||||||||||
550,000 | Public Storage | 55,781,000 | ||||||||
REIT – Warehouse and Industrial – 0.5% | ||||||||||
2,300,000 | AMB Property Corp. | 72,933,000 | ||||||||
Rental Auto/Equipment – 0.4% | ||||||||||
3,000,000 | Aaron Rents, Inc.£ | 61,170,000 | ||||||||
Retail – Apparel and Shoe – 1.4% | ||||||||||
3,600,000 | American Eagle Outfitters, Inc. | 52,668,000 | ||||||||
6,200,000 | Gap, Inc. | 137,268,000 | ||||||||
189,936,000 | ||||||||||
Retail – Consumer Electronics – 0.4% | ||||||||||
1,800,000 | Best Buy Co., Inc. | 61,722,000 | ||||||||
Retail – Discount – 1.2% | ||||||||||
2,600,000 | Big Lots, Inc.* | 79,196,000 | ||||||||
1,750,000 | Wal-Mart Stores, Inc. | 94,377,500 | ||||||||
173,573,500 | ||||||||||
Retail – Drug Store – 1.1% | ||||||||||
3,400,000 | CVS Caremark Corp. | 118,218,000 | ||||||||
853,000 | Walgreen Co. | 33,232,880 | ||||||||
151,450,880 | ||||||||||
Retail – Major Department Stores – 0.4% | ||||||||||
1,700,000 | JC Penney Co., Inc. | 54,927,000 | ||||||||
Retail – Regional Department Stores – 0.4% | ||||||||||
1,000,000 | Kohl’s Corp.* | 54,340,000 | ||||||||
Savings/Loan/Thrifts – 2.5% | ||||||||||
9,600,000 | First Niagara Financial Group, Inc. | 134,208,000 | ||||||||
8,000,000 | People’s United Financial, Inc. | 112,080,000 | ||||||||
5,800,000 | Washington Federal, Inc.£ | 98,136,000 | ||||||||
344,424,000 | ||||||||||
Semiconductor Equipment – 0.6% | ||||||||||
6,400,000 | Applied Materials, Inc. | 89,920,000 | ||||||||
Soap and Cleaning Preparations – 0.7% | ||||||||||
1,400,000 | Church & Dwight Co., Inc. | 96,628,000 | ||||||||
Super-Regional Banks – 1.5% | ||||||||||
3,200,000 | Fifth Third Bancorp. | 46,976,000 | ||||||||
1,500,000 | PNC Financial Services Group, Inc. | 91,080,000 | ||||||||
2,300,000 | SunTrust Banks, Inc. | 67,873,000 | ||||||||
205,929,000 | ||||||||||
Telephone – Integrated – 1.0% | ||||||||||
3,150,000 | CenturyLink, Inc. | 145,435,500 | ||||||||
Textile-Home Furnishings – 0.3% | ||||||||||
800,000 | Mohawk Industries, Inc.* | 45,408,000 | ||||||||
Tools – Hand Held – 0.5% | ||||||||||
1,150,000 | Snap-On, Inc. | 65,067,000 | ||||||||
Toys – 0.3% | ||||||||||
1,700,000 | Mattel, Inc. | 43,231,000 | ||||||||
Transportation – Marine – 0.6% | ||||||||||
2,000,000 | Kirby Corp.* | 88,100,000 | ||||||||
Transportation – Railroad – 1.4% | ||||||||||
2,100,000 | Kansas City Southern* | 100,506,000 | ||||||||
400,000 | Norfolk Southern Corp. | 25,128,000 | ||||||||
802,500 | Union Pacific Corp. | 74,359,650 | ||||||||
199,993,650 | ||||||||||
Transportation – Truck – 0.5% | ||||||||||
1,800,000 | J.B. Hunt Transport Services, Inc. | 73,458,000 | ||||||||
Wireless Equipment – 0.4% | ||||||||||
1,000,000 | QUALCOMM, Inc. | 49,490,000 | ||||||||
X-Ray Equipment – 1.0% | ||||||||||
7,300,000 | Hologic, Inc.* | 137,386,000 | ||||||||
Total Common Stock (cost $10,486,348,558) | 12,769,888,641 | |||||||||
Purchased Options – Puts – 0.2% | ||||||||||
14,580 | iShares Russell 2000® Index Fund expires January 2011 exercise price $68.00** | 163,746 | ||||||||
14,578 | iShares Russell 2000® Index Fund expires February 2011 exercise price $68.00** | 747,327 | ||||||||
13,216 | iShares Russell 2000® Index Fund expires February 2011 exercise price $69.00** | 800,130 | ||||||||
14,164 | iShares Russell 2000® Index Fund expires February 2011 exercise price $70.00** | 1,012,392 | ||||||||
12,800 | iShares Russell 2000® Index Fund expires February 2011 exercise price $72.00** | 1,273,455 | ||||||||
12,836 | iShares Russell 2000® Index Fund expires March 2011 exercise price $71.00** | 2,258,824 | ||||||||
12,010 | iShares Russell 2000® Index Fund expires March 2011 exercise price $76.00** | 3,182,888 | ||||||||
18,008 | iShares Russell 2000® Index Fund expires March 2011 exercise price $76.00** | 4,772,477 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 25
Table of Contents
Perkins Mid Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares/Principal/Contract Amounts | Value | |||||||||
29,542 | iShares Russell 2000® Index Fund expires May 2011 exercise price $77.00** | $ | 13,539,066 | |||||||
24,842 | iShares Russell Midcap® Value Index Fund expires January 2011 exercise price $37.00** | 964 | ||||||||
24,592 | iShares Russell Midcap® Value Index Fund expires January 2011 exercise price $37.39** | 1,426 | ||||||||
23,984 | iShares Russell Midcap® Value Index Fund expires January 2011 exercise price $38.37** | 3,813 | ||||||||
Total Purchased Options – Puts (premiums paid $80,247,492) | 27,756,508 | |||||||||
Repurchase Agreements – 8.7% | ||||||||||
$800,000,000 | Credit Agricole, New York Branch, 0.1200%, dated 12/31/10, maturing 1/3/11 to be repurchased at $800,008,000 collateralized by $669,995,687 in U.S. Treasuries 0.7500% – 8.7500% 11/30/11 – 1/15/27 with a value of $816,000,026 | 800,000,000 | ||||||||
87,500,000 | Deutsche Bank Securities, Inc., 0.1800% dated 12/31/10, maturing 1/3/11 to be repurchased at $87,501,313 collateralized by $86,703,100 in a U.S. Treasury 4.5000%, 8/15/39 with a value of $89,250,004 | 87,500,000 | ||||||||
77,091,000 | ING Financial Markets LLC, 0.0800% dated 12/31/10, maturing 1/3/11 to be repurchased at $77,091,514 collateralized by $78,194,649 in U.S. Treasuries 0.0000%-3.3750%,3/10/11-4/15/32 with a value of $78,633,341 | 77,091,000 | ||||||||
250,000,000 | RBC Capital Markets Corp., 0.1500% dated 12/31/10, maturing 1/3/11 to be repurchased at $250,003,125 collateralized by $252,682,357 in U.S. Treasuries 0.0000% – 2.3750% 3/10/11 – 2/28/15 with a value of $255,000,030 | 250,000,000 | ||||||||
Total Repurchase Agreements (cost $1,214,591,000) | 1,214,591,000 | |||||||||
Total Investments (total cost $11,781,187,050) – 100.2% | 14,012,236,149 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets **– (0.2)% | (23,375,898) | |||||||||
Net Assets – 100% | $ | 13,988,860,251 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Bermuda | $ | 409,986,722 | 2.9% | |||||
Canada | 241,781,000 | 1.7% | ||||||
Ireland | 151,083,500 | 1.1% | ||||||
Switzerland | 328,209,496 | 2.4% | ||||||
United Kingdom | 227,472,819 | 1.6% | ||||||
United States†† | 12,653,702,612 | 90.3% | ||||||
Total | $ | 14,012,236,149 | 100.0% |
†† | Includes Cash Equivalents (81.6% excluding Cash Equivalents). Cash equivalents include investments in overnight repurchase agreements. |
Schedule of Written Options – Puts | Value | |||
iShares Russell 2000® Index Fund expires January 2011 7,290 contracts exercise price $61.00 | $ | (11,508) | ||
iShares Russell 2000® Index Fund expires February 2011 7,289 contracts exercise price $61.00 | (115,891) | |||
iShares Russell 2000® Index Fund expires February 2011 13,690 contracts exercise price $62.00 | (257,439) | |||
iShares Russell 2000® Index Fund expires February 2011 6,400 contracts exercise price $65.00 | (198,886) | |||
iShares Russell 2000® Index Fund expires March 2011 6,418 contracts exercise price $63.00 | (450,153) | |||
iShares Russell 2000® Index Fund expires March 2011 6,005 contracts exercise price $68.00 | (592,932) | |||
iShares Russell 2000® Index Fund expires March 2011 8,404 contracts exercise price $68.00 | (829,808) | |||
iShares Russell 2000® Index Fund expires May 2011 14,771 contracts exercise price $69.00 | (3,362,911) | |||
iShares Russell Midcap® Value Index Fund expires January 2011 12,421 contracts exercise price $33.22 | (10) |
See Notes to Schedules of Investments and Financial Statements.
26 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Value | ||||
Schedule of Written Options – Puts – (continued) | ||||
iShares Russell Midcap® Value Index Fund expires January 2011 12,296 contracts exercise price $33.57 | $ | (13) | ||
iShares Russell Midcap® Value Index Fund expires January 2011 11,992 contracts exercise price $34.45 | (34) | |||
Total Written Options – Puts (premiums received $18,263,693 ) | $ | (5,819,585) | ||
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 27
Table of Contents
Perkins Small Cap Value Fund (unaudited)(closed to new investors)
Fund Snapshot We seek to outperform our benchmark and peers over a full market cycle by building diversified portfolios of what we believe to be high quality, undervalued stocks with favorable reward to risk characteristics. We believe that rigorous downside analysis conducted prior to determination of upside potential allows us to mitigate losses during difficult markets and perform well in up markets. | Managed by Perkins Investment Management LLC |
Performance Overview
During the six months ended December 31, 2010, Perkins Small Cap Value Fund’s Class T Shares returned 17.99%, versus a 26.58% return for the Fund’s benchmark, the Russell 2000 Value Index.
Economic Environment
The overall U.S. equity market, as represented by the S&P 500 index returned 23.27% for the period amid improving economic data and the Federal Reserve’s (Fed) second round of quantitative easing (QE2). Small-and mid-cap stocks led the rally. As we are at least as focused on absolute returns as we are relative returns, we are pleased with the Fund’s results despite the underperformance. The Fund behaved largely as we would have expected and its pattern of returns is consistent with that of our other Funds. Although the short-term performance was respectable, we pride ourselves on the results we have achieved over the long term. Our emphasis on determining the potential downside or risk of an opportunity has served us well in down markets and has worked well for us over three decades.
Investment Approach
Our stock selection was negative in energy, materials and financials. Conversely, our names within consumer staples and our underweight in utilities helped relative returns. Our sector weightings haven’t varied much over the last year. Of note, we continue to be overweight health care, which had significantly underperformed until the November elections. With the possibility of some change in health care policy, these relatively inexpensive stocks have rebounded, yet remain below their past valuations. The increase in merger and acquisition (M&A) activity has benefited our Fund and could be a positive next year as well given high cash levels on many corporate balance sheets. We stand ready to deploy cash and expect volatility will be above average, which should provide us with opportunities to advantageously purchase good long term values. Thus while we are uncertain about the market outlook, we believe we are well positioned to provide competitive returns going forward.
Holdings That Contributed to Performance
Industrial service provider Dycom Industries outperformed after announcing an improvement in its backlog due to new project wins. We started this position in the second quarter of 2010 as the stock lagged due to concerns about a downturn in customer spending and what we viewed to be limited downside to the stock price. We are encouraged by the pickup in backlog, the stock repurchase program, and the company’s solid balance sheet.
Natural gas exposed Bill Barrett Corporation (BBG) contributed positively to performance as the company finally secured long awaited environmental permits from the Federal Government. Additionally, we think the company continued to execute its business plan well in a rather challenging natural gas environment. We were initially drawn to BBG based on its relatively inexpensive valuation on EBITDA (earnings before interest, taxes, depreciation and amortization), its minimal potential downside based on our analysis, and because it had become essentially an after-thought by most of the investment community due to its Rocky Mountain gas exposure.
Holdings That Detracted From Performance
Within energy, it was a difficult period for Comstock Resources, Inc., as the company lowered production guidance for 2010 due to delays in well completions caused by tight supply in the fracturing services. Management leased additional acreage and the market seemed to ignore the longer-term potential of this acreage and chose to focus on the absolute level of spending, which remains elevated despite soft natural gas prices. Couple this with the lack of hedging, thus 100% exposure to volatile spot natural gas prices, and investors depressed Comstock’s shares during the period, despite attractive valuation on an asset basis.
28 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
Timber REIT Potlatch Corp. also failed to keep pace. The company has chosen to sell select parcels of land in order to supplement cash flows and help fund its distribution in the near term. While we wish the company didn’t find itself in this situation, by our estimates the cash flow yield from its harvest is similar to its peers, while Potlatch could be more leveraged to a recovery.
Specialty consulting company, Navigant Consulting, declined after missing earnings due to weakness in their litigation business. We maintained our small position due to the company’s healthy balance sheet, free cash flow generation, and in our opinion attractive valuation. Additionally, we believe the company could benefit from an increase in litigation stemming from the financial turmoil of the past few years.
Market Outlook
After having disappointing growth in the middle of the year, the economy has shown signs of reaccelerating. Average forecasts of real Gross Domestic Product (GDP) growth in 2011 have moved up from the 2.5% area to 3.0-3.5%. This is the result of the Fed announcing a second phase of monetary easing (QE2) and, most recently, a two year extension of the Bush tax cuts. While these measures will likely be stimulative in the near term, it is debatable as to whether they will have a longer lasting significantly constructive impact. The more optimistic view would be that these measures foster increased consumer and business confidence and build a sustained economic momentum. Additionally in the aftermath of the November elections, Congress and the Administration are likely to be more business friendly. Some observers are making the case that this is indicative of a sea change in policy. While we are hopeful, we do not make investments on hope. Regarding policy we remain skeptical. Most politicians tend to be overly partisan and have had difficulty squarely addressing problems that require sacrifice by their constituents. In the meantime, we continue to believe that Fed policy is an aggressive experiment and it is unclear how it will be unwound. Governmental deficits are unsustainable in many parts of the globe, and state and local budgets represent over 10% of the economy. Unemployment is likely to remain high and housing could continue to be weak.
One of the stated goals of QE2 is to pump up the stock market which creates wealth and confidence that could stimulate the economy. On that score to date, the Fed has been successful as the stock market has had a strong response to the prospect of QE2, the election and tax compromise. Earnings growth has been above expectations and earnings of the S&P 500 Index should be about $85 per share for 2010. With the stronger economy, further gains could put the S&P’s net earnings at $95 per share in 2011. Thus we believe stocks are selling at a reasonable 13x expected 2011 earnings. Even with the yield on 10-year Treasuries having backed up to almost 3.5%, stocks offer attractive relative value in our opinion. In fact in recent weeks, bond funds have experienced outflows and stock funds have had net inflows, a reversal of the strong trend that has been a major headwind for stocks. Thus we enter 2011 with very positive investor consensus and equity market momentum which could continue over the near term.
Balancing these positives are the longer term challenges of deficits, deleveraging, and international economic and political imbalances. Thus, we continue to agree with Fed Chairman Bernanke when he stated that the outlook is “unusually uncertain.” Valuations could be restrained by the unlikely sustainability of monetary and fiscal policies that are temporarily supporting the economy. The duration of this “easy money” could be in doubt given the inflationary pressures seen in a broad range of commodities, from oil to cotton, during 2010.
Given the lack of longer term clarity, as has been the case historically, we are focused more on individual company fundamentals than the macro environment. In a potentially volatile market, we believe that our emphasis on strong balance sheets, free cash flow and below average valuations is especially appropriate. And the uncertainty of our economic outlook leads us in many cases to have company earnings estimates that are below consensus. This fits well with our standard sensitivity to risk. This approach is reflected not only in our long term results, but also very clearly in our most recent three year returns. While we underperformed in 2010, we suffered relatively less in the 2008 market debacle. The result is that we have had positive returns for the three-year period which are significantly better than most indexes, some of which have negative results for the period. We think this is graphic evidence that it is much more important how a portfolio does in down markets than how it performs in up markets.
Thank you for your investment in Perkins Small Cap Value Fund.
Janus Value Funds | 29
Table of Contents
Perkins Small Cap Value Fund (unaudited)(closed to new investors)
Perkins Small Cap Value Fund At A Glance
5 Top Performers – Holdings
Contribution | ||||
Dycom Industries, Inc. | 0.56% | |||
Microsemi Corp. | 0.51% | |||
Bill Barrett Corp. | 0.50% | |||
TTM Technologies, Inc. | 0.49% | |||
Forest Oil Corp. | 0.49% |
5 Bottom Performers – Holdings
Contribution | ||||
Comstock Resources, Inc. | –0.20% | |||
Potlatch Corp. | –0.11% | |||
Navigant Consulting, Inc. | –0.07% | |||
Sanderson Farms, Inc. | –0.07% | |||
Skechers U.S.A., Inc. – Class A | –0.05% |
5 Top Performers – Sectors*
Fund Weighting | Russell 2000® | |||||||||||
Fund Contribution | (Average % of Equity) | Value Index Weighting | ||||||||||
Information Technology | 4.59% | 15.09% | 9.55% | |||||||||
Financials | 4.43% | 28.26% | 37.71% | |||||||||
Industrials | 4.40% | 15.45% | 14.01% | |||||||||
Consumer Discretionary | 2.74% | 9.67% | 9.76% | |||||||||
Health Care | 2.71% | 12.52% | 5.78% |
5 Bottom Performers – Sectors*
Fund Weighting | Russell 2000® | |||||||||||
Fund Contribution | (Average % of Equity) | Value Index Weighting | ||||||||||
Utilities | –0.01% | 0.14% | 6.58% | |||||||||
Telecommunication Services | 0.06% | 0.60% | 0.59% | |||||||||
Materials | 0.57% | 2.98% | 5.82% | |||||||||
Consumer Staples | 1.38% | 5.75% | 3.05% | |||||||||
Energy | 1.85% | 9.54% | 7.15% |
Security contribution to performance is measured by using an algorithm that multiplies the daily performance of each security with the previous day’s ending weight in the portfolio and is gross of advisory fees. Fixed income securities and certain equity securities, such as private placements and some share classes of equity securities, are excluded. | ||
* | Based on sector classification according to the Global Industry Classification Standard codes, which are the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
30 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
Flowers Foods, Inc. Food – Baking | 1.8% | |||
URS Corp. Engineering – Research and Development Services | 1.7% | |||
Government Properties Income Trust REIT – Office Property | 1.6% | |||
Charles River Laboratories International, Inc. Medical – Biomedical and Genetic | 1.6% | |||
Tech Data Corp. Electronic Parts Distributors | 1.6% | |||
8.3% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30p02.gif)
Top County Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30t02.gif)
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30c02.gif)
Janus Value Funds | 31
Table of Contents
Perkins Small Cap Value Fund (unaudited)(closed to new investors)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30m02.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – per the October 28, 2010 prospectuses | ||||||||||||
Fiscal | One | Five | Ten | Total Annual Fund | Net Annual Fund | ||||||||
Year-to-Date | Year | Year | Year | Operating Expenses | Operating Expenses | ||||||||
Perkins Small Cap Value Fund – Class A Shares(1) | |||||||||||||
NAV | 17.91% | 17.79% | 7.58% | 9.31% | 1.21% | 1.21% | |||||||
MOP | 11.11% | 11.01% | 6.31% | 8.67% | |||||||||
Perkins Small Cap Value Fund – Class C Shares(1) | |||||||||||||
NAV | 17.44% | 16.88% | 6.82% | 8.55% | 1.96% | 1.96% | |||||||
CDSC | 16.30% | 15.74% | 6.82% | 8.55% | |||||||||
Perkins Small Cap Value Fund – Class D Shares(1) | 18.05% | 18.00% | 7.84% | 9.60% | 0.96% | 0.96% | |||||||
Perkins Small Cap Value Fund – Class I Shares(1) | 18.08% | 18.13% | 7.82% | 9.59% | 0.85% | 0.85% | |||||||
Perkins Small Cap Value Fund – Class L Shares(1) | 18.12% | 18.18% | 8.06% | 9.85% | 1.06% | 1.06% | |||||||
Perkins Small Cap Value Fund – Class R Shares(1) | 17.70% | 17.36% | 7.31% | 9.07% | 1.57% | 1.57% | |||||||
Perkins Small Cap Value Fund – Class S Shares(1) | 17.86% | 17.64% | 7.58% | 9.34% | 1.32% | 1.32% | |||||||
Perkins Small Cap Value Fund – Class T Shares(1) | 17.99% | 17.87% | 7.82% | 9.59% | 1.06% | 1.06% | |||||||
Russell 2000® Value Index | 26.58% | 24.50% | 3.52% | 8.42% | |||||||||
Lipper Quartile – Class T Shares | – | 4th | 1st | 1st | |||||||||
Lipper Ranking – based on total returns for Small-Cap Core Funds | – | 760/797 | 61/569 | 73/330 | |||||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Fund’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
See important disclosures on the next page.
32 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
Janus Capital has contractually agreed to waive the Fund’s total annual fund operating expenses allocated to any class (excluding any performance adjustments to management fees, distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares, Class R Share and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class L Shares, Class R Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers returns would have been lower.
Janus Services LLC has agreed to waive all or a portion of the administrative fee applicable to the Fund’s Class L Shares. Such waiver is voluntary and could change or be terminated at any time at the discretion of Janus Services LLC or Janus Capital without prior notification to shareholders. Total returns shown include fee waivers, if any, and without such waivers, the total returns would have been lower.
The expense information shown was determined based on net assets as of the fiscal period ended June 30, 2010. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” (All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.)
The Fund has a performance-based management fee that adjusts up or down based on the Fund’s performance relative to an approved benchmark index over a performance measurement period. See the Fund’s Prospectus or Statement of Additional Information for more details.
The Fund’s performance may be affected by risks that include those associated with undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), derivatives and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
The Fund will normally invest at least 80% of its net assets, measured at the time of purchase, in the type of securities described by its name.
Due to certain investment strategies, the Fund may have an increased position in cash.
Effective February 16, 2010, Perkins Small Cap Value Fund renamed Class J Shares to Class T Shares.
Effective February 16, 2010, the Fund’s Class J Shares held in accounts directly with Janus were moved into the newly created Class D Shares.
Class A Shares, Class C Shares, Class R Shares and Class S Shares of the Fund commenced operations on July 6, 2009. The performance shown for each class reflects the performance of the Fund’s Class J Shares (formerly named Investor Shares) from April 21, 2003 to July 6, 2009, calculated using the fees and expenses of each respective class, without the effect of any fee and expense limitations or waivers. For periods prior to April 21, 2003, the performance shown for each class reflects the historical performance of Berger Small Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Small Cap Value Fund – Investor Shares into the Fund’s former Class J Shares), calculated using the fees and expenses of each respective share class, without the effect of any fee and expense limitations or waivers. If each share class of the Fund had been available during periods prior to July 6, 2009, the performance shown for each respective share class may have been different. The performance shown for periods following the Fund’s commencement of each class reflects the fees and expenses of each respective class, net of any fee and expense limitations or waivers.
Class D Shares of the Fund commenced operations on February 16, 2010, as a result of the restructuring of Class J Shares. The performance shown for Class D Shares for periods prior to February 16, 2010, reflects the performance of the Fund’s former Class J Shares (formerly named Investor Shares). For the periods prior to April 21, 2003, the performance shown for Class D Shares reflects the historical performance of Berger Small Cap Value Fund–Investor Shares (as a result of a prior reorganization of Berger Small Cap Value Fund – Investor Shares into the Fund’s Class J Shares). If Class D Shares of the Fund had been available during periods prior to February 16, 2010, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class D Shares reflects the fees and expenses of Class D Shares, net of any fee and expense limitations or waivers.
Class I Shares of the Fund commenced operations on July 6, 2009. The performance shown for Class I Shares reflects the performance of the Fund’s Class J Shares (formerly named Investor Shares) from April 23, 2003 to July 6, 2009, calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. For periods prior to April 21, 2003, the performance shown for Class I Shares reflects the historical performance of Berger Small Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Small
Janus Value Funds | 33
Table of Contents
Perkins Small Cap Value Fund (unaudited)(closed to new investors)
Cap Value Fund – Investor Shares into the Fund’s former Class J Shares), calculated using the fees and expenses of Class J Shares, without the effect of any fee and expense limitations or waivers. If Class I Shares of the Fund had been available during periods prior to July 6, 2009, the performance shown may have been different. The performance shown for periods following the Fund’s commencement of Class I Shares reflects the fees and expenses of Class I Shares, net of any fee and expense limitations or waivers.
The performance shown for Class L Shares for periods following April 21, 2003, reflects the fees and expenses of Class L Shares (formerly named Institutional Shares), net of any fee and expense limitations or waivers. For the periods prior to April 21, 2003, the performance shown for Class L Shares reflects the historical performance of Berger Small Cap Value Fund – Institutional Shares (as a result of a prior reorganization of Berger Small Cap Value Fund – Institutional Shares into the Fund’s Class L Shares).
The performance shown for Class T Shares for periods following April 21, 2003, reflects the fees and expenses of Class T Shares (formerly named Class J Shares), net of any fee and expense limitations or waivers. For the periods prior to April 21, 2003, the performance shown for Class T Shares reflects the historical performance of Berger Small Cap Value Fund – Investor Shares (as a result of a prior reorganization of Berger Small Cap Value Fund – Investor Shares into the Fund’s Class J Shares).
Lipper, a wholly-owned subsidiary of Thomson Reuters, provides independent insight on global collective investments including mutual funds, retirement funds, hedge funds, fund fees and expenses to the asset management and media communities. Lipper ranks the performance of mutual funds within a classification of funds that have similar investment objectives. Rankings are historical with capital gains and dividends reinvested and do not include the effect of loads.
Ranking is for Class T Shares only; other classes may have different performance characteristics. When an expense waiver is in effect, it may have a material effect on the total return, and therefore the ranking for the period.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the index. The index is unmanaged and is not available for direct investment; therefore, its performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
(1) | Effective May 28, 2010, Perkins Small Cap Value Fund is closed to certain new investors. Please see current prospectus for details. |
34 | DECEMBER 31, 2010
Table of Contents
(unaudited)(closed to new investors)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,179.10 | $ | 6.65 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.11 | $ | 6.16 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,174.90 | $ | 10.96 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,015.12 | $ | 10.16 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,180.50 | $ | 5.55 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.11 | $ | 5.14 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,181.30 | $ | 4.95 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.67 | $ | 4.58 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class L Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,181.70 | $ | 4.62 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,020.97 | $ | 4.28 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class R Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,177.00 | $ | 8.78 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.14 | $ | 8.13 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,178.60 | $ | 7.41 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,018.40 | $ | 6.87 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/1/10) | (12/31/10) | (7/1/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,179.80 | $ | 6.04 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,019.66 | $ | 5.60 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.21% for Class A Shares, 2.00% for Class C Shares, 1.01% for Class D Shares, 0.90% for Class I Shares, 0.84% for Class L Shares, 1.60% for Class R Shares, 1.35% for Class S Shares and 1.10% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. |
Janus Value Funds | 35
Table of Contents
Perkins Small Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Common Stock – 82.5% | ||||||||||
Apparel Manufacturers – 0.9% | ||||||||||
1,350,000 | Jones Apparel Group, Inc. | $ | 20,979,000 | |||||||
400,000 | Volcom, Inc.* | 7,548,000 | ||||||||
28,527,000 | ||||||||||
Applications Software – 0.6% | ||||||||||
475,000 | Progress Software Corp.* | 20,102,000 | ||||||||
Building – Heavy Construction – 1.3% | ||||||||||
1,100,000 | Granite Construction, Inc. | 30,173,000 | ||||||||
1,100,000 | Sterling Construction Co., Inc.*,£ | 14,344,000 | ||||||||
44,517,000 | ||||||||||
Building – Residential and Commercial – 0.6% | ||||||||||
1,150,000 | Ryland Group, Inc. | 19,584,500 | ||||||||
Building and Construction – Miscellaneous – 0.8% | ||||||||||
1,800,000 | Dycom Industries, Inc.*,£ | 26,550,000 | ||||||||
Circuit Boards – 0.7% | ||||||||||
1,550,000 | TTM Technologies, Inc.* | 23,110,500 | ||||||||
Commercial Banks – 6.2% | ||||||||||
417,204 | Bank of Hawaii Corp. | 19,696,201 | ||||||||
1,700,000 | First Midwest Bancorp, Inc. | 19,584,000 | ||||||||
900,000 | Firstmerit Corp. | 17,811,000 | ||||||||
2,750,000 | Glacier Bancorp, Inc. | 41,552,500 | ||||||||
575,000 | Hancock Holding Co. | 20,044,500 | ||||||||
400,000 | Iberiabank Corp. | 23,652,000 | ||||||||
1,850,000 | TCF Financial Corp. | 27,398,500 | ||||||||
1,250,000 | Texas Capital Bancshares, Inc.* | 26,587,500 | ||||||||
290,000 | Trustmark Corp. | 7,203,600 | ||||||||
203,529,801 | ||||||||||
Commercial Services – Finance – 1.8% | ||||||||||
1,000,000 | Global Payments, Inc. | 46,210,000 | ||||||||
900,000 | Total System Services, Inc. | 13,842,000 | ||||||||
60,052,000 | ||||||||||
Computer Services – 0.6% | ||||||||||
1,000,000 | SRA International, Inc.* | 20,450,000 | ||||||||
Computers – Integrated Systems – 2.2% | ||||||||||
1,600,000 | Diebold, Inc. | 51,280,000 | ||||||||
720,000 | Jack Henry & Associates, Inc. | 20,988,000 | ||||||||
72,268,000 | ||||||||||
Consulting Services – 1.1% | ||||||||||
500,000 | CRA International, Inc.*,£ | 11,755,000 | ||||||||
125,000 | MAXIMUS, Inc. | 8,197,500 | ||||||||
1,650,000 | Navigant Consulting, Inc.* | 15,180,000 | ||||||||
35,132,500 | ||||||||||
Containers – Paper and Plastic – 1.3% | ||||||||||
800,000 | Sonoco Products Co. | 26,936,000 | ||||||||
675,000 | Temple-Inland, Inc. | 14,337,000 | ||||||||
41,273,000 | ||||||||||
Cosmetics and Toiletries – 0.4% | ||||||||||
350,000 | Alberto-Culver Co. | 12,964,000 | ||||||||
Diagnostic Equipment – 1.5% | ||||||||||
2,450,000 | Immucor, Inc.* | 48,583,500 | ||||||||
Direct Marketing – 0.8% | ||||||||||
2,000,000 | Harte-Hanks, Inc. | 25,540,000 | ||||||||
Distribution/Wholesale – 0.6% | ||||||||||
710,000 | Owens & Minor, Inc. | 20,895,300 | ||||||||
Diversified Operations – 0.5% | ||||||||||
400,000 | Carlisle Cos., Inc. | 15,896,000 | ||||||||
Electronic Components – Semiconductors – 3.2% | ||||||||||
1,550,000 | Intersil Corp. – Class A | 23,668,500 | ||||||||
800,000 | Microsemi Corp.* | 18,320,000 | ||||||||
1,194,228 | Monolithic Power Systems, Inc.* | 19,728,647 | ||||||||
1,500,000 | QLogic Corp.* | 25,530,000 | ||||||||
810,000 | Semtech Corp.* | 18,338,400 | ||||||||
105,585,547 | ||||||||||
Electronic Connectors – 0.7% | ||||||||||
475,000 | Thomas & Betts Corp.* | 22,942,500 | ||||||||
Electronic Parts Distributors – 1.6% | ||||||||||
1,200,000 | Tech Data Corp.* | 52,824,000 | ||||||||
Engineering – Research and Development Services – 1.7% | ||||||||||
1,360,000 | URS Corp.* | 56,589,600 | ||||||||
Enterprise Software/Services – 0.8% | ||||||||||
1,800,000 | Omnicell, Inc.*,£ | 26,010,000 | ||||||||
Food – Baking – 1.8% | ||||||||||
2,175,000 | Flowers Foods, Inc. | 58,529,250 | ||||||||
Food – Retail – 0.8% | ||||||||||
725,000 | Ruddick Corp. | 26,709,000 | ||||||||
Footwear and Related Apparel – 1.1% | ||||||||||
600,000 | Skechers U.S.A., Inc. – Class A* | 12,000,000 | ||||||||
750,000 | Wolverine World Wide, Inc. | 23,910,000 | ||||||||
35,910,000 | ||||||||||
Forestry – 1.3% | ||||||||||
1,350,000 | Potlatch Corp. | 43,942,500 | ||||||||
Golf – 0.8% | ||||||||||
3,200,000 | Callaway Golf Co. | 25,824,000 | ||||||||
Industrial Automation and Robotics – 0.3% | ||||||||||
320,000 | Cognex Corp. | 9,414,400 | ||||||||
Instruments – Scientific – 0.9% | ||||||||||
1,135,000 | PerkinElmer, Inc. | 29,305,700 | ||||||||
Insurance Brokers – 0.5% | ||||||||||
750,000 | Brown & Brown, Inc. | 17,955,000 | ||||||||
Internet Security – 0.3% | ||||||||||
375,000 | Blue Coat Systems Inc* | 11,201,250 | ||||||||
Internet Telephony – 1.1% | ||||||||||
1,200,000 | J2 Global Communications, Inc. | 34,740,000 | ||||||||
Machinery – Electrical – 0.6% | ||||||||||
480,000 | Franklin Electric Co. Inc. | 18,681,600 | ||||||||
Machinery – General Industrial – 1.1% | ||||||||||
900,000 | Albany International Corp. – Class A | 21,321,000 | ||||||||
300,000 | Wabtec Corp. | 15,867,000 | ||||||||
37,188,000 | ||||||||||
Medical – Biomedical and Genetic – 1.6% | ||||||||||
1,500,000 | Charles River Laboratories International, Inc.* | 53,310,000 | ||||||||
Medical Imaging Systems – 0.4% | ||||||||||
872,197 | Vital Images, Inc.*,£ | 12,193,314 |
See Notes to Schedules of Investments and Financial Statements.
36 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Medical Instruments – 0.6% | ||||||||||
1,300,000 | Angiodynamics, Inc.*,£ | $ | 19,981,000 | |||||||
Medical Labs and Testing Services – 1.5% | ||||||||||
875,000 | Covance, Inc.* | 44,983,750 | ||||||||
250,000 | Genoptix, Inc.*,£ | 4,755,000 | ||||||||
49,738,750 | ||||||||||
Medical Laser Systems – 0.1% | ||||||||||
385,000 | LCA-Vision, Inc.* | 2,213,750 | ||||||||
Medical Products – 1.4% | ||||||||||
1,300,000 | PSS World Medical, Inc.* | 29,380,000 | ||||||||
425,000 | West Pharmaceutical Services, Inc. | 17,510,000 | ||||||||
46,890,000 | ||||||||||
Medical Sterilization Products – 1.3% | ||||||||||
1,200,000 | STERIS Corp. | 43,752,000 | ||||||||
Metal Processors and Fabricators – 1.5% | ||||||||||
1,250,000 | Kaydon Corp. | 50,900,000 | ||||||||
Miscellaneous Manufacturing – 0.4% | ||||||||||
750,000 | Movado Group, Inc.*,£ | 12,105,000 | ||||||||
Multi-Line Insurance – 1.4% | ||||||||||
3,300,000 | Old Republic International Corp. | 44,979,000 | ||||||||
Oil – Field Services – 0.7% | ||||||||||
900,000 | PAA Natural Gas Storage L.P. | 22,446,000 | ||||||||
Oil Companies – Exploration and Production – 4.7% | ||||||||||
825,000 | Bill Barrett Corp.* | 33,932,250 | ||||||||
1,100,000 | Cabot Oil & Gas Corp. | 41,635,000 | ||||||||
1,530,000 | Comstock Resources, Inc.* | 37,576,800 | ||||||||
1,150,000 | Forest Oil Corp.* | 43,665,500 | ||||||||
156,809,550 | ||||||||||
Paper and Related Products – 1.6% | ||||||||||
2,511,538 | Glatfelter£ | 30,816,571 | ||||||||
440,000 | Rayonier, Inc. | 23,108,800 | ||||||||
53,925,371 | ||||||||||
Pharmacy Services – 0.8% | ||||||||||
1,100,000 | Omnicare, Inc. | 27,929,000 | ||||||||
Pipelines – 1.5% | ||||||||||
800,000 | Niska Gas Storage Partners LLC | 15,960,000 | ||||||||
1,100,000 | Western Gas Partners L.P. | 33,330,000 | ||||||||
49,290,000 | ||||||||||
Poultry – 0.7% | ||||||||||
550,000 | Sanderson Farms, Inc. | 21,532,500 | ||||||||
Property and Casualty Insurance – 3.1% | ||||||||||
1,050,000 | HCC Insurance Holdings, Inc. | 30,387,000 | ||||||||
250,000 | Infinity Property & Casualty Corp. | 15,450,000 | ||||||||
900,000 | Navigators Group (The), Inc.*,£ | 45,315,000 | ||||||||
200,000 | RLI Corp. | 10,514,000 | ||||||||
101,666,000 | ||||||||||
Real Estate Operating/Development – 1.0% | ||||||||||
1,550,000 | St. Joe Co.* | 33,867,500 | ||||||||
REIT – Hotels – 0.8% | ||||||||||
2,250,000 | DiamondRock Hospitality Co.* | 27,000,000 | ||||||||
REIT – Mortgage – 0.9% | ||||||||||
1,925,000 | Redwood Trust, Inc. | 28,740,250 | ||||||||
REIT – Office Property – 2.4% | ||||||||||
2,000,000 | Government Properties Income Trust£ | 53,580,000 | ||||||||
800,000 | Mack-Cali Realty Corp. | 26,448,000 | ||||||||
80,028,000 | ||||||||||
Rental Auto/Equipment – 0.6% | ||||||||||
1,050,000 | Aaron Rents, Inc. | 21,409,500 | ||||||||
Retail – Apparel and Shoe – 0.8% | ||||||||||
1,500,000 | American Eagle Outfitters, Inc. | 21,945,000 | ||||||||
1,000,000 | bebe Stores, Inc. | 5,960,000 | ||||||||
27,905,000 | ||||||||||
Retail – Convenience Stores – 0.4% | ||||||||||
325,000 | Casey’s General Stores, Inc. | 13,815,750 | ||||||||
Retail – Leisure Products – 0.3% | ||||||||||
1,000,000 | MarineMax, Inc.* | 9,350,000 | ||||||||
Retail – Pet Food and Supplies – 0.5% | ||||||||||
400,000 | PetSmart, Inc. | 15,928,000 | ||||||||
Retail – Propane Distribution – 0.7% | ||||||||||
550,000 | Inergy L.P. | 21,582,000 | ||||||||
Retail – Restaurants – 0.4% | ||||||||||
450,000 | Bob Evans Farms | 14,832,000 | ||||||||
Savings/Loan/Thrifts – 4.8% | ||||||||||
3,750,000 | First Niagara Financial Group, Inc. | 52,425,000 | ||||||||
2,150,000 | NewAlliance Bancshares, Inc. | 32,207,000 | ||||||||
1,998,700 | Provident Financial Services, Inc. | 30,240,331 | ||||||||
2,550,000 | Washington Federal, Inc. | 43,146,000 | ||||||||
158,018,331 | ||||||||||
Semiconductor Equipment – 0.6% | ||||||||||
800,000 | MKS Instruments, Inc.* | 19,592,000 | ||||||||
Telecommunication Services – 0.4% | ||||||||||
2,000,000 | Premiere Global Services, Inc.* | 13,600,000 | ||||||||
Tools – Hand Held – 0.5% | ||||||||||
270,000 | Snap-On, Inc. | 15,276,600 | ||||||||
Transportation – Marine – 1.3% | ||||||||||
1,000,000 | Kirby Corp.* | 44,050,000 | ||||||||
Transportation – Railroad – 0.6% | ||||||||||
440,000 | Kansas City Southern* | 21,058,400 | ||||||||
Wire and Cable Products – 0.5% | ||||||||||
450,000 | Belden, Inc. | 16,569,000 | ||||||||
X-Ray Equipment – 1.2% | ||||||||||
2,150,000 | Hologic, Inc.* | 40,463,000 | ||||||||
Total Common Stock (cost $2,283,507,698) | 2,725,074,014 | |||||||||
Repurchase Agreements – 17.6% | ||||||||||
$350,000,000 | Credit Agricole, New York Branch, 0.1200% dated 12/31/10, maturing 1/3/11 to be repurchased at $350,003,500 collateralized by $293,123,113 in U.S. Treasuries 0.7500%-8.7500%,11/30/11-1/15/27 with a value of $357,000,011 | 350,000,000 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 37
Table of Contents
Perkins Small Cap Value Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
$131,803,000 | ING Financial Markets LLC, 0.0800% dated 12/31/10, maturing 1/3/11 to be repurchased at $131,803,879 collateralized by $133,689,917 in U.S. Treasuries 0.0000%-3.3750%,3/10/11-4/15/32 with a value of $134,439,950 | $ | 131,803,000 | |||||||
100,000,000 | RBC Capital Markets Corp., 0.1500% dated 12/31/10, maturing 1/3/11 to be repurchased at $100,001,250 collateralized by $101,072,943 in U.S. Treasuries 0.0000%-2.3750%,3/10/11-2/28/15 with a value of $102,000,012 | 100,000,000 | ||||||||
Total Repurchase Agreements (cost $581,803,000) | 581,803,000 | |||||||||
Total Investments (total cost $2,865,310,698) – 100.1% | 3,306,877,014 | |||||||||
Liabilities, net of Cash, Receivables and Other Assets – (0.1)% | (2,284,161) | |||||||||
Net Assets – 100% | $ | 3,304,592,853 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
United States†† | $ | 3,306,877,014 | 100.0% | |||||
Total | $ | 3,306,877,014 | 100.0% |
†† | Includes Cash Equivalents (82.4% excluding Cash Equivalents). Cash equivalents include investments in overnight repurchase agreements. |
See Notes to Schedules of Investments and Financial Statements.
38 | DECEMBER 31, 2010
Table of Contents
Perkins Value Plus Income Fund (unaudited)
Fund Snapshot We believe in the timeless adage of power of compounding and in doing so our focus is on mitigating losses in difficult markets. We invest in securities we believe have favorable reward-to-risk ratios by focusing first on rigorous downside analysis prior to determining upside potential. We seek to outperform both our benchmark and peers over a full market cycle by building diversified portfolios of, undervalued stocks and fixed income securities. | Managed by Perkins Investment Management LLC |
Performance Overview
Since its launch on July 30, 2010 and through December 31, 2010, Perkins Value Plus Income Fund’s Class I Shares returned 9.36%, outperforming the Value Income Index, which returned 7.05%. The Value Income Index, which is the Fund’s secondary benchmark, is a hypothetical internally-calculated index that combines the total returns from the Russell 1000 Value Index (50%) and the Barclays Capital U.S. Aggregate Bond Index (50%). The Russell 1000 Value Index, the Fund’s primary benchmark, returned 14.02% over the same period while the Fund’s other secondary benchmark, the Barclays Capital U.S. Aggregate Bond Index, posted an 8.00% gain during the period.
Market Environment
U.S. equity markets had a relatively strong second half of 2010 amid improving economic data and the Federal Reserve’s (Fed) quantitative easing (QE2). Large-cap value underperformed the general market while small-cap growth led as investors were attracted to riskier segments of the market. Materials and energy stocks were among the top performing sectors as commodity prices continued to head higher. On the other side, traditionally more defensive sectors, such as health care and utilities underperformed. The greater appetite for risk portrayed within equity markets was echoed within fixed income as high-yield bonds outperformed. Strong corporate health continued to support valuations among equities while contributing to the narrowing of spreads within corporate credit.
Fears of inflation have put many bond investors on yellow alert and fueled a more volatile environment for fixed income. An example of this sentiment occurred in the fourth quarter of 2010, when intermediate-to-long dated U.S. Treasuries sold off sharply. The dramatic spike in rates was not a result of economic data indicating a rise in inflation; rather, it was a result of investors concluding that the extension of the Bush tax cuts, more stimulus spending, and quantitative easing by the Federal Reserve (Fed) would drive inflation well beyond previous expectations.
We do not believe that a significant spike in inflation is imminent. We view the economic landscape through individual company and credit analysis, both of which indicate that inflationary pressures remain in check. As the recovery gains momentum, the threat of inflation could be real. We also believe the consensus scenario around an upward trend in rates is likely to play out in the medium term, maintaining pressure in the fixed income markets. But it’s important to keep in mind that there is considerable slack in the employment and goods market, and deflationary pressures are still working their way through the system, mitigating upward price momentum. We will be watching closely for early signs of inflationary pressures and will be attempting to prepare the Fund accordingly.
Portfolio Overview
Our overweighting to equities (54% at period end) combined with our underweighting to fixed income (38%) provided a boost to returns compared to the Value Income Index while our relatively high cash balance of just over 7% held back relative results. Our equity weighting was at the upper end of our 40%-60% range.
Our equity sleeve in aggregate outperformed the Russell 1000 Value Index. This outperformance was driven largely by our holdings within financials, health care and consumer-related sectors. Meanwhile, our energy holdings underperformed. On the fixed income side relative to the Barclays Capital U.S. Aggregate Bond Index our selections within corporate credit were the largest drivers of this sleeve’s outperformance during the period. Our U.S. Treasuries underweighting and focus on shorter maturities also aided relative results while our zero exposure to mortgage-backed securities (MBS) hurt comparable returns. As we manage the fixed income sleeve with a greater emphasis on corporate credit, we maintained a significant overweighting in credit relative to the Barclays Capital U.S. Aggregate Bond Index (69% vs.
Janus Value Funds | 39
Table of Contents
Perkins Value Plus Income Fund (unaudited)
23%), while maintaining an underweight in U.S. Treasuries (16% vs. 33%) through period end.
In our joint management of the Fund, both Perkins and Janus investment teams are at least as focused on absolute total returns as we are relative returns, and therefore, are focused on the long term. Our emphasis on determining the potential downside or risk of an opportunity, both within fixed income and equities, has served us well in challenging market environments.
Equity Contributors
Within materials, copper producer Freeport-McMoRan rebounded off mid-year depressed levels to lead among individual equity contributors. Like many commodity prices, copper continued its trend higher given high emerging market demand, particularly from China. Freeport benefited as it is one of the few direct plays. The company is a low cost producer, has a solid balance sheet and robust free cash flow in our view.
The telecommunication services sector significantly outperformed the broader market early in the period, with AT&T, Inc. providing the best performance among our stocks in this area. AT&T remains a core holding given its historically stable dividend, strong free cash flow generation, and attractive valuation.
Fixed Income Contributors
Our holdings in First Data Corp., a processor of financial transactions, topped the list of individual out performers within the Fund’s fixed income sleeve. As a processor of credit card transactions, First Data is leveraged to consumer spending, which saw steady improvement during the period including fourth quarter holiday sales. The bond market responded well as company was able to extend a significant portion of its fixed bond maturity profile past 2020, allowing them the space to grow into their highly levered capital structure.
Equity Detractors
H&R Block, Inc., a provider of tax, banking and consulting services, struggled as it dealt with management turnover and concerns it may be on the hook to repurchase some subprime mortgages tied to its mortgage division, which was sold in 2008. We exited our small position in the name as we became increasingly uncomfortable with the company’s potential downside risk.
Hewlett-Packard was weaker in the period due to the management turnover in the CEO role and because the company embarked on a couple of acquisitions that appear to be expensive. While we believe the balance sheet and free cash flows are rather healthy, and valuation is compelling, the lack of leadership at the top, and the expensive acquisitions announced in the third quarter, led us to maintain only a small position in the name.
Fixed Income Detractors
The top individual detractor during the period was Regions Financial Corp. We initially were attracted to this regional provider of commercial, retail and mortgage banking services given its improving credit performance, government support and new management team. Investors grew impatient with Regions’ slower-than-expected pace of recovery. Management subsequently surprised the street by terminating the firm’s risk management leadership without notice. Immediately afterwards, Regions was downgraded by a rating agency and the bonds underperformed. It was clear to us our investment thesis was compromised and we subsequently exited the position.
Derivatives
Due to certain circumstances and market conditions, we may initiate positions in call and put options on equities in an attempt to hedge risk and generate additional income for the Fund. We sometimes sell calls on portions of existing long equity holdings. We do this at stock prices at which we’d be willing to trim the securities. We may also write puts at strike prices at which we would be willing to buy the stock. The option trades are initiated to generate income based on fundamental research and our view of risk and volatility. Please see the Derivative Instruments section in the “Notes to Financial Statements” for a discussion of derivatives used by the Fund.
Market Outlook
After having disappointing growth in the middle of the year, the economy has shown signs of reaccelerating. Average forecasts of real Gross Domestic Product (GDP) growth in 2011 have moved up from the 2.5% area to 3.0-3.5%. This is the result of the Federal Reserve (Fed) announcing a second phase of monetary easing (QE2) and, most recently, a two year extension of the Bush tax cuts. While these measures will likely be stimulative in the near term, it is debatable as to whether they will have a longer lasting significantly constructive impact. The more optimistic view would be that these measures foster increased consumer and business confidence and build a sustained economic momentum. Additionally in the
40 | DECEMBER 31, 2010
Table of Contents
(unaudited)
aftermath of the November elections, Congress and the Administration are likely to be more business friendly.
Balancing these positives are the longer term challenges of deficits, deleveraging, and international economic and political imbalances. Valuations could be restrained by the unlikely sustainability of monetary and fiscal policies that are temporarily supporting the economy. The duration of this “easy money��� could be in doubt given the inflationary pressures seen in a broad range of commodities, from oil to cotton, during 2010.
One of the stated goals of QE2 is to pump up the stock market which creates wealth and confidence that could stimulate the economy. It also has been designed to rein in higher rates and allow businesses and consumers to refinance. On both scores to date, the Fed has been somewhat successful as the stock market has had a strong response and balance sheet deleveraging has continued. Earnings growth has been above expectations and earnings of the S&P 500 Index should be about $85 per share for 2010. With the stronger economy, further gains could put the S&P’s net earnings at $95 per share in 2011. Thus stocks are selling at a reasonable 13x to 14x expected 2011 earnings in our view.
In light of the bond market’s focus on inflation expectations, investors may begin to see notable divergences in the risk/reward profiles of fixed income. We believe one of the greatest and most under-appreciated risks relates to duration extension of the indices and thus an increase in overall interest rate risk. (Duration measures a bond’s sensitivity to changes in interest rates). The Barclays Capital U.S. Aggregate Bond index duration increased 15% from 4.21 to 4.85 years over the last six months of 2010 with the most significant change coming from its MBS component increasing 83% from 2.18 to 3.99 years. A slowdown in mortgage prepayments and upward movement in interest rates fueled the rise, along with increased issuance of U.S. government debt. This extension in duration increases risk across much of the fixed income spectrum, in our opinion. However, investors who use passive strategies linked to a benchmark are particularly exposed to the market’s increased risk profile.
Fortunately, we have the flexibility to allocate into areas where we think the risk/reward profile is more attractive. Though concerns about rising Treasury rates are timely, we do not believe all fixed income sectors are doomed to negative returns in 2011. For example, we continue to see considerable opportunity in corporate credits. In the investment grade arena, we believe there is ample room for spreads to tighten. In addition, the added yield associated with owning credit can offset some of the volatility in underlying interest rates. We also feel high yield corporate debt offers opportunities, particularly in shorter-duration offerings. There is additional return potential in lower quality debt and we are selectively stepping down the quality spectrum where corporate strength is evident. This enforces our emphasis on credit selection, which we think is critical to driving returns in this volatile and uncertain market.
Working together, we strive to position the Fund to deliver monthly income and capital appreciation in a balanced portfolio that leverages the strengths of the Perkins team and Janus Fixed Income team.
Thank you for your investment with us in Perkins Value Plus Income Fund.
Janus Value Funds | 41
Table of Contents
Perkins Value Plus Income Fund (unaudited)
Perkins Value Plus Income Fund At A Glance
5 Top Performers – Holdings
Contribution | ||||
Freeport-McMoRan Copper & Gold, Inc. – Class B | 0.44% | |||
AT&T, Inc. | 0.43% | |||
Koppers Holdings, Inc. | 0.41% | |||
Devon Energy Corp. | 0.33% | |||
Pfizer, Inc. | 0.32% |
5 Bottom Performers – Holdings
Contribution | ||||
H&R Block, Inc. | –0.11% | |||
Hewlett-Packard Co. | –0.09% | |||
Inergy L.P. | –0.08% | |||
Entergy Corp. | –0.06% | |||
Spectra Energy Partners L.P. | –0.03% |
5 Top Performers – Sectors*
Fund Weighting | Russell 1000® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Financials | 2.87% | 21.79% | 27.41% | |||||||||
Energy | 2.77% | 10.75% | 11.60% | |||||||||
Health Care | 2.11% | 12.43% | 13.08% | |||||||||
Consumer Discretionary | 1.78% | 8.04% | 7.63% | |||||||||
Consumer Staples | 1.69% | 12.07% | 10.32% |
5 Bottom Performers – Sectors*
Fund Weighting | Russell 1000® Value | |||||||||||
Fund Contribution | (Average % of Equity) | Index Weighting | ||||||||||
Utilities | –0.24% | 3.24% | 7.29% | |||||||||
Telecommunication Services | 0.95% | 5.86% | 5.19% | |||||||||
Materials | 1.05% | 4.38% | 3.02% | |||||||||
Industrials | 1.42% | 10.07% | 8.93% | |||||||||
Information Technology | 1.62% | 11.38% | 5.53% |
Security contribution to performance is measured by using an algorithm that multiplies the daily performance of each security with the previous day’s ending weight in the portfolio and is gross of advisory fees. Fixed income securities and certain equity securities, such as private placements and some share classes of equity securities, are excluded. | ||
* | Based on sector classification according to the Global Industry Classification Standard codes, which are the exclusive property and a service mark of MSCI Inc. and Standard & Poor’s. |
42 | DECEMBER 31, 2010
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(unaudited)
5 Largest Equity Holdings – (% of Net Assets)
As of December 31, 2010
AT&T, Inc. Telephone – Integrated | 1.4% | |||
First Niagara Financial Group, Inc. Savings/Loan/Thrifts | 1.0% | |||
Pfizer, Inc. Medical – Drugs | 0.9% | |||
General Electric Co. Diversified Operations | 0.9% | |||
Medtronic, Inc. Medical Instruments | 0.9% | |||
5.1% |
Asset Allocation – (% of Net Assets)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30p04.gif)
Emerging markets comprised 0.9% of total net assets.
Top Country Allocations – Long Positions (% of Investment Securities)
As of December 31, 2010
![(GRAPH)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30t04.gif)
Janus Value Funds | 43
Table of Contents
Perkins Value Plus Income Fund (unaudited)
Performance
![(PERFORMANCE CHART)](https://capedge.com/proxy/N-CSRS/0000950123-11-019116/d79932jif30m04.gif)
Average Annual Total Return – for the periods ended December 31, 2010 | Expense Ratios – estimated for the fiscal year | ||||||
Since | Total Annual Fund | Net Annual Fund | |||||
Inception* | Operating Expenses | Operating Expenses | |||||
Perkins Value Plus Income Fund – Class A Shares | |||||||
NAV | 9.28% | 1.90% | 1.01% | ||||
MOP | 3.00% | ||||||
Perkins Value Plus Income Fund – Class C Shares | |||||||
NAV | 8.96% | 2.67% | 1.76% | ||||
CDSC | 7.88% | ||||||
Perkins Value Plus Income Fund – Class D Shares(1) | 9.34% | 1.66% | 0.88% | ||||
Perkins Value Plus Income Fund – Class I Shares | 9.36% | 1.56% | 0.76% | ||||
Perkins Value Plus Income Fund – Class S Shares | 9.17% | 2.04% | 1.26% | ||||
Perkins Value Plus Income Fund – Class T Shares | 9.28% | 1.79% | 1.01% | ||||
Russell 1000® Value Index | 14.02% | ||||||
Barclays Capital U.S. Aggregate Bond Index | 8.00% | ||||||
Value Income Index | 7.05% | ||||||
Lipper Quartile – Class I Shares | – | ||||||
Lipper Ranking – based on total returns for Mixed-Asset Target Allocation Moderate Funds | – | ||||||
Visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus Capital) to view current performance and characteristic information | |||||||
Data presented represents past performance, which is no guarantee of future results. Investment results and principal value will fluctuate so that shares, when redeemed, may be worth more or less than their original cost. Due to market volatility, current performance may be higher or lower than the performance shown. Call 877.33JANUS(52687) (or 800.525.3713 if you hold shares directly with Janus Capital) or visit janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold shares directly with Janus Capital) for performance current to the most recent month-end.
Performance shown for Class A Shares at Maximum Offering Price (MOP) includes the Portfolio’s maximum sales charge of 5.75%. Performance shown at Net Asset Value (NAV) does not include this charge and would have been lower had this charge been taken into account.
Performance shown for Class C Shares includes a 1% contingent deferred sales charge (CDSC) on periods of less than 12 months. Performance shown at Net Asset Value (NAV) does not include this sales charge and would have been lower had this sales charge been taken into account.
See important disclosures on the next page.
44 | DECEMBER 31, 2010
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(unaudited)
Janus Capital has contractually agreed to waive the Fund’s total operating expenses allocated to any class (excluding distribution and shareholder servicing fees (applicable to Class A Shares, Class C Shares and Class S Shares), administrative services fees payable pursuant to the Transfer Agency Agreement (applicable to Class D Shares, Class S Shares and Class T Shares), brokerage commissions, interest, dividends, taxes, and extraordinary expenses including, but not limited to, acquired fund fees and expenses) to certain limits until at least November 1, 2011. The contractual waiver may be terminated at any time prior to this date only at the discretion of the Board of Trustees. Returns shown include fee waivers, if any, and without such waivers returns would have been lower.
Expense information shown reflects estimated annualized expenses that the share classes for the Fund expect to incur during the fiscal year. Contractual waivers agreed to by Janus Capital, where applicable, are included under “Net Annual Fund Operating Expenses.” All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
The Fund’s performance may be affected by risks that include those associated with non-investment grade debt securities, high-yield/high-risk securities, undervalued or overlooked companies, investments in specific industries or countries and potential conflicts of interest with the Janus “funds of funds.” Additional risks to the Fund may include those associated with investing in foreign securities, emerging markets, initial public offerings (“IPOs”), real estate investment trusts (“REITs”), derivatives, short sales and companies with relatively small market capitalizations. Please see a Janus prospectus or janus.com/info (or janus.com/reports if you hold shares directly with Janus Capital) for more information about risks, portfolio holdings and other details.
The Fund invests in REITs, which may be subject to a higher degree of market risk because of concentration in a specific industry, sector or geographic region. REITs may be subject to risks including, but not limited to: legal, political, liquidity, and interest rate risks, a decline in the value of real estate, risks related to general and economic conditions, changes in the value of the underlying property owned by the trust and defaults by borrowers. To the extent the Fund invests in foreign REITs, the Fund may be subject to fluctuations in currency rates or political or economic conditions in a particular country.
The Fund may invest in derivatives which can be highly volatile and involve additional risks than if the underlying securities were held directly by the Fund. Such risks include gains or losses which, as a result of leverage, can be substantially greater than the derivatives’ original cost. There is also a possibility that derivatives may not perform as intended which can reduce opportunity for gains or result in losses by offsetting positive returns in other securities the Fund owns.
Funds that invest in bonds have the same interest rate, inflation, and credit risks that are associated with the underlying bonds owned by the fund. Unlike owning individual bonds, there are ongoing fees and expenses associated with owning shares of bonds funds. The return of principal is not guaranteed due to net asset value fluctuation that is caused by changes in the price of specific bonds held in the fund and selling of bonds within the fund by the portfolio managers.
High-yield/high-risk bonds, also known as “junk” bonds, involve a greater risk of default and price volatility than U.S. Government and other high quality bonds. High-yield/high-risk bonds can experience sudden and sharp price swings which will affect net asset value.
For a period of three years subsequent to the Fund’s commencement of operations, Janus Capital may recover from the Fund fees and expenses previously waived or reimbursed if the Fund’s expense ratio, including recovered expenses, falls below the expense limit.
The Fund’s performance for very short time periods may not be indicative of future performance.
Returns include reinvestment of dividends from net investment income and distributions from capital gains. The returns shown do not reflect the deduction of taxes that a shareholder would pay on Portfolio distributions or the redemption of Fund shares. The returns do not include adjustments in accordance with generally accepted accounting principles required at the period end for financial reporting purposes.
Lipper does not rank this Fund as it is less than one year old.
There is no assurance that the investment process will consistently lead to successful investing.
See Notes to Schedules of Investments for index definitions.
The Fund’s portfolio may differ significantly from the securities held in the indices. The indices are unmanaged and are not available for direct investment; therefore, their performance does not reflect the expenses associated with the active management of an actual portfolio.
See “Explanations of Charts, Tables and Financial Statements.”
* | The Fund’s inception date – July 30, 2010 | |
(1) | Closed to new investors. |
Janus Value Funds | 45
Table of Contents
Perkins Value Plus Income Fund (unaudited)
Fund Expenses
The examples below show you the ongoing costs (in dollars) of investing in your Fund and allow you to compare these costs with those of other mutual funds. Please refer to the section Useful Information About Your Fund Report for a detailed explanation of the information presented in these charts.
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class A Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,092.80 | $ | 4.80 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,016.65 | $ | 4.62 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class C Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,089.60 | $ | 8.03 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,013.55 | $ | 7.74 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class D Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,093.40 | $ | 4.40 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.03 | $ | 4.24 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class I Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,093.60 | $ | 3.96 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,017.45 | $ | 3.81 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class S Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,091.70 | $ | 5.86 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,015.63 | $ | 5.65 | ||||||||
Beginning Account Value | Ending Account Value | Expenses Paid During Period | ||||||||||||
Expense Example – Class T Shares | (7/30/10) | (12/31/10) | (7/30/10 - 12/31/10)† | |||||||||||
Actual | $ | 1,000.00 | $ | 1,092.80 | $ | 4.75 | ||||||||
Hypothetical (5% return before expenses) | $ | 1,000.00 | $ | 1,016.69 | $ | 4.58 | ||||||||
† | Expenses are equal to the annualized expense ratio of 1.08% for Class A Shares, 1.81% for Class C Shares, 0.99% for Class D Shares, 0.89% for Class I Shares, 1.32% for Class S Shares and 1.07% for Class T Shares multiplied by the average account value over the period, multiplied by 184/365 (to reflect the one-half year period). Expenses include effect of contractual waivers by Janus Capital. Actual expenses paid reflect only the inception period (July 30, 2010 to December 31, 2010). Therefore, actual expenses shown are lower than would be expected for a six-month period. Actual expenses are equal to the annualized ration multiplied by the average account value over the period multiplied by 155/365 (to reflect the period); however, hypothetical expenses are multiplied by 181/365 (to reflect a one-half year period). |
46 | DECEMBER 31, 2010
Table of Contents
Perkins Value Plus Income Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Bank Loans – 1.1% | ||||||||||
Aerospace and Defense – 0.2% | ||||||||||
$60,000 | TransDigm Group Inc. 5.0000%, 12/6/16‡ | $ | 60,538 | |||||||
Automotive – Cars and Light Trucks – 0.3% | ||||||||||
77,471 | Ford Motor Co. 3.0200%, 12/15/13‡ | 55,142 | ||||||||
22,204 | Ford Motor Co. 3.0400%, 12/15/13‡ | 22,154 | ||||||||
77,296 | ||||||||||
Retail – Apparel and Shoe – 0.4% | ||||||||||
32,511 | Phillips-Van Heusen Corp. 0%, 5/6/16 (a),‡ | 32,909 | ||||||||
79,339 | Phillips-Van Heusen Corp. 4.7500%, 5/6/16‡ | 80,311 | ||||||||
113,220 | ||||||||||
Retail – Restaurants – 0.2% | ||||||||||
2,643 | DineEquity, Inc. 0%, 10/19/17 (a),‡ | 2,680 | ||||||||
24,595 | DineEquity, Inc. 6.0000%, 10/19/17‡ | 55,363 | ||||||||
58,043 | ||||||||||
Total Bank Loans (cost $308,103) | 309,097 | |||||||||
Common Stock – 54.1% | ||||||||||
Aerospace and Defense – 0.4% | ||||||||||
2,500 | Raytheon Co. | 115,850 | ||||||||
Aerospace and Defense – Equipment – 0.2% | ||||||||||
700 | United Technologies Corp. | 55,104 | ||||||||
Apparel Manufacturers – 0.5% | ||||||||||
5,000 | Jones Apparel Group, Inc. | 77,700 | ||||||||
800 | VF Corp. | 68,944 | ||||||||
146,644 | ||||||||||
Applications Software – 0.8% | ||||||||||
8,000 | Microsoft Corp. | 223,360 | ||||||||
Beverages – Non-Alcoholic – 1.0% | ||||||||||
1,900 | Coca-Cola Co. | 124,963 | ||||||||
2,300 | PepsiCo, Inc. | 150,259 | ||||||||
275,222 | ||||||||||
Brewery – 0.3% | ||||||||||
1,900 | Molson Coors Brewing Co. – Class B | 95,361 | ||||||||
Cable Television – 0.4% | ||||||||||
5,500 | Comcast Corp. – Class A | 120,835 | ||||||||
Cellular Telecommunications – 1.3% | ||||||||||
6,500 | SK Telecom Co. Ltd. (ADR) | 121,095 | ||||||||
9,000 | Vodafone Group PLC | 237,870 | ||||||||
358,965 | ||||||||||
Commercial Banks – 2.5% | ||||||||||
1,500 | Bank of Hawaii Corp. | 70,815 | ||||||||
6,000 | BB&T Corp. | 157,740 | ||||||||
10,500 | Glacier Bancorp, Inc. | 158,655 | ||||||||
1,500 | Iberiabank Corp. | 88,695 | ||||||||
1,400 | M&T Bank Corp. | 121,870 | ||||||||
3,500 | Trustmark Corp. | 86,940 | ||||||||
684,715 | ||||||||||
Commercial Services – Finance – 1.3% | ||||||||||
2,700 | Paychex, Inc. | 83,457 | ||||||||
5,400 | Total System Services, Inc. | 83,052 | ||||||||
10,500 | Western Union Co. | 194,985 | ||||||||
361,494 | ||||||||||
Computer Services – 0.8% | ||||||||||
1,000 | Accenture, Ltd. – Class A (U.S. Shares) | 48,490 | ||||||||
1,200 | International Business Machines Corp. | 176,112 | ||||||||
224,602 | ||||||||||
Computers – 0.2% | ||||||||||
1,200 | Hewlett-Packard Co. | 50,520 | ||||||||
Computers – Integrated Systems – 0.3% | ||||||||||
1,200 | Diebold, Inc. | 38,460 | ||||||||
1,200 | Jack Henry & Associates, Inc. | 34,980 | ||||||||
73,440 | ||||||||||
Consumer Products – Miscellaneous – 0.2% | ||||||||||
800 | Kimberly-Clark Corp. | 50,432 | ||||||||
Containers – Metal and Glass – 0.5% | ||||||||||
2,300 | Greif, Inc. | 142,370 | ||||||||
Containers – Paper and Plastic – 0.6% | ||||||||||
3,200 | Packaging Corp. of America | 82,688 | ||||||||
4,100 | Temple-Inland, Inc. | 87,084 | ||||||||
169,772 | ||||||||||
Direct Marketing – 0.4% | ||||||||||
8,000 | Harte-Hanks, Inc. | 102,160 | ||||||||
Distribution/Wholesale – 0.2% | ||||||||||
2,200 | Owens & Minor, Inc. | 64,746 | ||||||||
Diversified Banking Institutions – 0.6% | ||||||||||
4,000 | JPMorgan Chase & Co. | 169,680 | ||||||||
Diversified Operations – 2.9% | ||||||||||
600 | 3M Co. | 51,780 | ||||||||
1,500 | Carlisle Cos., Inc. | 59,610 | ||||||||
13,600 | General Electric Co. | 248,744 | ||||||||
2,500 | Illinois Tool Works, Inc. | 133,500 | ||||||||
4,500 | Koppers Holdings, Inc. | 161,010 | ||||||||
3,500 | Tyco International, Ltd. (U.S. Shares) | 145,040 | ||||||||
799,684 | ||||||||||
Electric – Integrated – 1.4% | ||||||||||
1,800 | Entergy Corp. | 127,494 | ||||||||
7,500 | PPL Corp. | 197,400 | ||||||||
1,800 | Public Service Enterprise Group, Inc. | 57,258 | ||||||||
382,152 | ||||||||||
Electronic Components – Miscellaneous – 0.4% | ||||||||||
4,000 | Garmin, Ltd. | 123,960 | ||||||||
Electronic Components – Semiconductors – 1.4% | ||||||||||
10,000 | Intel Corp. | 210,300 | ||||||||
3,500 | Intersil Corp. – Class A | 53,445 | ||||||||
4,000 | Xilinx, Inc. | 115,920 | ||||||||
379,665 | ||||||||||
Finance – Investment Bankers/Brokers – 0.3% | ||||||||||
2,300 | Raymond James Financial, Inc. | 75,210 | ||||||||
Food – Baking – 0.5% | ||||||||||
5,500 | Flowers Foods, Inc. | 148,005 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 47
Table of Contents
Perkins Value Plus Income Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Food – Miscellaneous/Diversified – 2.3% | ||||||||||
10,000 | ConAgra Foods, Inc. | $ | 225,800 | |||||||
1,800 | General Mills, Inc. | 64,062 | ||||||||
3,400 | Kellogg Co. | 173,672 | ||||||||
1,000 | Kraft Foods, Inc. – Class A | 31,510 | ||||||||
5,000 | Unilever PLC (ADR) | 154,400 | ||||||||
649,444 | ||||||||||
Food – Retail – 0.3% | ||||||||||
3,500 | Kroger Co. | 78,260 | ||||||||
Food – Wholesale/Distribution – 0.3% | ||||||||||
3,000 | Sysco Corp. | 88,200 | ||||||||
Forestry – 0.2% | ||||||||||
1,800 | Potlatch Corp. | 58,590 | ||||||||
Gas – Distribution – 0.3% | ||||||||||
2,400 | AGL Resources, Inc. | 86,040 | ||||||||
Instruments – Scientific – 0.2% | ||||||||||
2,700 | PerkinElmer, Inc. | 69,714 | ||||||||
Investment Management and Advisory Services – 0.3% | ||||||||||
3,400 | INVESCO, Ltd. | 81,804 | ||||||||
Machinery – General Industrial – 0.5% | ||||||||||
6,000 | Albany International Corp. – Class A | 142,140 | ||||||||
Medical – Drugs – 3.2% | ||||||||||
4,000 | Abbott Laboratories | 191,640 | ||||||||
1,400 | Eli Lilly & Co. | 49,056 | ||||||||
2,300 | Merck & Co., Inc. | 82,892 | ||||||||
3,800 | Novartis A.G. | 224,010 | ||||||||
14,500 | Pfizer, Inc. | 253,895 | ||||||||
2,600 | Roche Holding A.G. (ADR) | 95,290 | ||||||||
896,783 | ||||||||||
Medical – HMO – 0.3% | ||||||||||
2,000 | UnitedHealth Group, Inc. | 72,220 | ||||||||
Medical – Wholesale Drug Distributors – 0.4% | ||||||||||
1,200 | Cardinal Health, Inc. | 45,972 | ||||||||
1,000 | McKesson Corp. | 70,380 | ||||||||
116,352 | ||||||||||
Medical Instruments – 1.0% | ||||||||||
600 | Beckman Coulter, Inc. | 45,138 | ||||||||
6,500 | Medtronic, Inc. | 241,085 | ||||||||
286,223 | ||||||||||
Medical Products – 1.8% | ||||||||||
1,600 | Baxter International, Inc. | 80,992 | ||||||||
1,500 | Becton, Dickinson and Co. | 126,780 | ||||||||
3,100 | Covidien PLC (U.S. Shares) | 141,546 | ||||||||
1,200 | Johnson & Johnson | 74,220 | ||||||||
1,800 | West Pharmaceutical Services, Inc. | 74,160 | ||||||||
497,698 | ||||||||||
Metal – Copper – 0.3% | ||||||||||
600 | Freeport-McMoRan Copper & Gold, Inc. – Class B** | 72,054 | ||||||||
Metal Processors and Fabricators – 0.2% | ||||||||||
1,300 | Kaydon Corp. | 52,936 | ||||||||
Multi-Line Insurance – 0.9% | ||||||||||
5,600 | Allstate Corp. | 178,528 | ||||||||
5,300 | Old Republic International Corp. | 72,239 | ||||||||
250,767 | ||||||||||
Multimedia – 0.5% | ||||||||||
4,500 | Time Warner, Inc. | 144,765 | ||||||||
Networking Products – 0.6% | ||||||||||
9,000 | Cisco Systems, Inc.* | 182,070 | ||||||||
Non-Hazardous Waste Disposal – 0.7% | ||||||||||
6,500 | Republic Services, Inc. | 194,090 | ||||||||
Office Automation and Equipment – 0.3% | ||||||||||
3,500 | Pitney Bowes, Inc. | 84,630 | ||||||||
Oil – Field Services – 0.1% | ||||||||||
500 | Schlumberger, Ltd. (U.S. Shares) | 41,750 | ||||||||
Oil Companies – Exploration and Production – 2.7% | ||||||||||
1,100 | Cabot Oil & Gas Corp. | 41,635 | ||||||||
2,700 | Devon Energy Corp. | 211,977 | ||||||||
4,100 | EQT Corp. | 183,844 | ||||||||
1,300 | Noble Energy, Inc.** | 111,904 | ||||||||
1,000 | Occidental Petroleum Corp. | 98,100 | ||||||||
2,900 | Southwestern Energy Co.* | 108,547 | ||||||||
756,007 | ||||||||||
Oil Companies – Integrated – 2.2% | ||||||||||
2,300 | Chevron Corp. | 209,875 | ||||||||
2,000 | ConocoPhillips | 136,200 | ||||||||
2,000 | Exxon Mobil Corp. | 146,240 | ||||||||
3,600 | Marathon Oil Corp. | 133,308 | ||||||||
625,623 | ||||||||||
Paper and Related Products – 0.8% | ||||||||||
9,500 | Glatfelter | 116,565 | ||||||||
2,000 | Rayonier, Inc. | 105,040 | ||||||||
221,605 | ||||||||||
Pipelines – 0.4% | ||||||||||
4,500 | Spectra Energy Corp. | 112,455 | ||||||||
Property and Casualty Insurance – 0.4% | ||||||||||
1,000 | Chubb Corp. | 59,640 | ||||||||
800 | Travelers Cos., Inc. | 44,568 | ||||||||
104,208 | ||||||||||
Reinsurance – 1.2% | ||||||||||
5,000 | Alterra Capital Holdings, Ltd. | 108,200 | ||||||||
700 | Everest Re Group, Ltd. | 59,374 | ||||||||
2,000 | PartnerRe, Ltd. | 160,700 | ||||||||
328,274 | ||||||||||
REIT – Apartments – 0.2% | ||||||||||
500 | Avalonbay Communities, Inc. | 56,275 | ||||||||
REIT – Health Care – 0.3% | ||||||||||
2,500 | Nationwide Health Properties, Inc. | 90,950 | ||||||||
REIT – Mortgage – 0.4% | ||||||||||
2,900 | Annaly Mortgage Management, Inc. | 51,968 | ||||||||
4,700 | Redwood Trust, Inc. | 70,171 | ||||||||
122,139 | ||||||||||
REIT – Office Property – 1.0% | ||||||||||
2,800 | BioMed Realty Trust, Inc. | 52,220 | ||||||||
2,500 | Corporate Office Properties | 87,375 | ||||||||
2,600 | Government Properties Income Trust | 69,654 | ||||||||
2,000 | Mack-Cali Realty Corp. | 66,120 | ||||||||
275,369 | ||||||||||
REIT – Regional Malls – 0.1% | ||||||||||
700 | Taubman Centers, Inc. | 35,336 |
See Notes to Schedules of Investments and Financial Statements.
48 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
REIT – Warehouse and Industrial – 0.3% | ||||||||||
2,500 | AMB Property Corp. | $ | 79,275 | |||||||
Retail – Apparel and Shoe – 0.7% | ||||||||||
4,200 | American Eagle Outfitters, Inc. | 61,446 | ||||||||
6,000 | Gap, Inc. | 132,840 | ||||||||
194,286 | ||||||||||
Retail – Consumer Electronics – 0.2% | ||||||||||
1,300 | Best Buy Co., Inc. | 44,577 | ||||||||
Retail – Discount – 0.8% | ||||||||||
1,700 | Target Corp. | 102,221 | ||||||||
2,400 | Wal-Mart Stores, Inc. | 129,432 | ||||||||
231,653 | ||||||||||
Retail – Drug Store – 0.6% | ||||||||||
4,000 | CVS Caremark Corp. | 139,080 | ||||||||
1,100 | Walgreen Co. | 42,856 | ||||||||
181,936 | ||||||||||
Retail – Restaurants – 0.3% | ||||||||||
�� | 1,300 | Bob Evans Farms | 42,848 | |||||||
500 | McDonald’s Corp. | 38,380 | ||||||||
81,228 | ||||||||||
Savings/Loan/Thrifts – 1.2% | ||||||||||
1,815 | Capitol Federal Financial | 21,616 | ||||||||
19,700 | First Niagara Financial Group, Inc. | 275,406 | ||||||||
3,000 | Provident Financial Services, Inc. | 45,390 | ||||||||
342,412 | ||||||||||
Semiconductor Equipment – 0.8% | ||||||||||
15,000 | Applied Materials, Inc. | 210,750 | ||||||||
Soap and Cleaning Preparations – 0.2% | ||||||||||
1,000 | Church & Dwight Co., Inc. | 69,020 | ||||||||
Super-Regional Banks – 2.0% | ||||||||||
3,300 | PNC Financial Services Group, Inc. | 200,376 | ||||||||
2,500 | SunTrust Banks, Inc. | 73,775 | ||||||||
3,000 | U.S. Bancorp. | 80,910 | ||||||||
6,500 | Wells Fargo & Co. | 201,435 | ||||||||
556,496 | ||||||||||
Telephone – Integrated – 1.6% | ||||||||||
12,900 | AT&T, Inc.** | 379,002 | ||||||||
1,500 | CenturyLink, Inc. | 69,255 | ||||||||
448,257 | ||||||||||
Tobacco – 0.5% | ||||||||||
2,600 | Altria Group, Inc. | 64,012 | ||||||||
1,300 | Philip Morris International, Inc. | 76,089 | ||||||||
140,101 | ||||||||||
Tools – Hand Held – 0.2% | ||||||||||
800 | Snap-On, Inc. | 45,264 | ||||||||
Toys – 0.2% | ||||||||||
1,700 | Mattel, Inc. | 43,231 | ||||||||
Transportation – Railroad – 0.2% | ||||||||||
700 | Norfolk Southern Corp. | 43,974 | ||||||||
Transportation – Services – 0.3% | ||||||||||
1,100 | United Parcel Service, Inc. – Class B | 79,838 | ||||||||
Wireless Equipment – 0.2% | ||||||||||
900 | QUALCOMM, Inc. | 44,541 | ||||||||
Total Common Stock (cost $13,615,944) | 15,105,558 | |||||||||
Corporate Bonds – 29.3% | ||||||||||
Agricultural Chemicals – 0.3% | ||||||||||
$23,000 | Incitec Pivot, Ltd. 4.0000%, 12/7/15 (144A) | 22,416 | ||||||||
50,000 | Phibro Animal Health Corp. 9.2500%, 7/1/18 (144A) | 51,500 | ||||||||
73,916 | ||||||||||
Apparel Manufacturers – 0.4% | ||||||||||
100,000 | Levi Strauss & Co. 7.6250%, 5/15/20 | 103,250 | ||||||||
Automotive – Cars and Light Trucks – 0.9% | ||||||||||
50,000 | Daimler Finance North America LLC 6.5000%, 11/15/13 | 56,603 | ||||||||
176,000 | Ford Motor Co. 7.4500%, 7/16/31 | 188,540 | ||||||||
245,143 | ||||||||||
Automotive – Truck Parts and Equipment – Original – 0.2% | ||||||||||
50,000 | American Axle & Manufacturing Holdings, Inc. 9.2500%, 1/15/17 (144A) | 55,875 | ||||||||
Beverages – Non-Alcoholic – 0.7% | ||||||||||
111,000 | The Coca-Cola Co. 0.7500%, 11/15/13 | 109,562 | ||||||||
77,000 | The Coca-Cola Co. 1.5000%, 11/15/15 | 73,908 | ||||||||
183,470 | ||||||||||
Brewery – 0.4% | ||||||||||
50,000 | Anheuser-Busch InBev Worldwide, Inc. 7.2000%, 1/15/14 (144A) | 57,180 | ||||||||
50,000 | Anheuser-Busch InBev Worldwide, Inc. 7.7500%, 1/15/19 (144A) | 62,217 | ||||||||
119,397 | ||||||||||
Building Products – Cement and Aggregate – 0.5% | ||||||||||
17,000 | CRH America, Inc. 4.1250%, 1/15/16 | 16,891 | ||||||||
23,000 | CRH America, Inc. 8.1250%, 7/15/18 | 26,586 | ||||||||
62,000 | CRH America, Inc. 5.7500%, 1/15/21 | 61,294 | ||||||||
25,000 | Holcim U.S. Finance (U.S. Shares) 6.0000%, 12/30/19 (144A) | 25,961 | ||||||||
130,732 | ||||||||||
Cable Television – 0.2% | ||||||||||
50,000 | Comcast Corp. 5.1500%, 3/1/20 | 52,517 | ||||||||
Cellular Telecommunications – 0.2% | ||||||||||
50,000 | Sprint Nextel Corp. 8.3750%, 8/15/17 | 53,625 | ||||||||
Chemicals – Diversified – 1.0% | ||||||||||
50,000 | Dow Chemical Co. 7.6000%, 5/15/14 | 57,669 | ||||||||
58,000 | Dow Chemical Co. 8.5500%, 5/15/19 | 72,688 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 49
Table of Contents
Perkins Value Plus Income Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Chemicals – Diversified – (continued) | ||||||||||
$45,000 | Dow Chemical Co. 4.2500%, 11/15/20 | $ | 43,106 | |||||||
100,000 | LBI Escrow Corp. 8.0000%, 11/1/17 (144A) | 110,625 | ||||||||
284,088 | ||||||||||
Chemicals – Specialty – 0.2% | ||||||||||
47,000 | Ashland, Inc. 9.1250%, 6/1/17 | 54,168 | ||||||||
Coal – 0% | ||||||||||
7,000 | Peabody Energy Corp. 6.5000%, 9/15/20 | 7,473 | ||||||||
Commercial Banks – 1.6% | ||||||||||
110,000 | CIT Group, Inc. 7.0000%, 5/1/13 | 112,200 | ||||||||
50,000 | CIT Group, Inc. 7.0000%, 5/1/15 | 50,125 | ||||||||
100,000 | CIT Group, Inc. 7.0000%, 5/1/17 | 100,250 | ||||||||
72,000 | Royal Bank of Scotland PLC 3.9500%, 9/21/15 | 70,778 | ||||||||
56,000 | SVB Financial Group 5.3750%, 9/15/20 | 53,849 | ||||||||
50,000 | Zions Bancorp. 7.7500%, 9/23/14 | 52,125 | ||||||||
439,327 | ||||||||||
Computer Services – 0.2% | ||||||||||
60,000 | Affiliated Computer Services, Inc. 5.2000%, 6/1/15 | 63,673 | ||||||||
Containers – Metal and Glass – 0.1% | ||||||||||
30,000 | Ball Corp. 5.7500%, 5/15/21 | 29,025 | ||||||||
Data Processing and Management – 0.7% | ||||||||||
100,000 | First Data Corp. 11.2500%, 3/31/16 | 87,500 | ||||||||
37,000 | Fiserv, Inc. 3.1250%, 10/1/15 | 36,637 | ||||||||
66,000 | Fiserv, Inc. 4.6250%, 10/1/20 | 64,105 | ||||||||
188,242 | ||||||||||
Diversified Banking Institutions – 2.7% | ||||||||||
60,000 | Bank of America Corp. 5.6250%, 7/1/20 | 61,170 | ||||||||
50,000 | Citigroup, Inc. 5.0000%, 9/15/14 | 51,724 | ||||||||
60,000 | Citigroup, Inc. 4.7500%, 5/19/15 | 62,826 | ||||||||
101,000 | Citigroup, Inc. 5.3750%, 8/9/20 | 104,940 | ||||||||
100,000 | GMAC, Inc. 6.8750%, 9/15/11 | 102,750 | ||||||||
125,000 | GMAC, Inc. 8.0000%, 11/1/31 | 134,687 | ||||||||
75,000 | Goldman Sachs Group, Inc. 5.3750%, 3/15/20 | 77,502 | ||||||||
50,000 | JPMorgan Chase & Co. 6.0000%, 1/15/18 | 55,837 | ||||||||
25,000 | JPMorgan Chase & Co. 4.4000%, 7/22/20 | 24,606 | ||||||||
75,000 | Morgan Stanley 5.6250%, 9/23/19 | 76,476 | ||||||||
752,518 | ||||||||||
Diversified Financial Services – 1.2% | ||||||||||
50,000 | General Electric Capital Corp. 4.8000%, 5/1/13 | 53,454 | ||||||||
50,000 | General Electric Capital Corp. 6.0000%, 8/7/19 | 55,630 | ||||||||
150,000 | General Electric Capital Corp. 5.5000%, 1/8/20 | 160,423 | ||||||||
48,000 | General Electric Capital Corp. 6.8750%, 1/10/39 | 55,472 | ||||||||
324,979 | ||||||||||
Diversified Minerals – 0.3% | ||||||||||
59,000 | FMG Resources August 2006 Pty, Ltd. 7.0000%, 11/1/15 (144A) | 60,475 | ||||||||
9,000 | Teck Resources, Ltd. 10.2500%, 5/15/16 | 11,137 | ||||||||
18,000 | Vale Overseas, Ltd. 4.6250%, 9/15/20 | 17,822 | ||||||||
89,434 | ||||||||||
Electric – Integrated – 0.7% | ||||||||||
22,000 | CMS Energy Corp. 8.5000%, 4/15/11 | 22,425 | ||||||||
32,000 | CMS Energy Corp. 4.2500%, 9/30/15 | 31,686 | ||||||||
22,000 | CMS Energy Corp. 5.0500%, 2/15/18 | 21,753 | ||||||||
31,000 | Public Service Co. of Colorado 3.2000%, 11/15/20 | 29,229 | ||||||||
100,000 | Xcel Energy, Inc. 4.7000%, 5/15/20 | 102,950 | ||||||||
208,043 | ||||||||||
Electronic Components – Semiconductors – 0.5% | ||||||||||
50,000 | Advanced Micro Devices, Inc. 8.1250%, 12/15/17 | 53,000 | �� | |||||||
32,000 | National Semiconductor Corp. 3.9500%, 4/15/15 | 32,591 | ||||||||
59,000 | National Semiconductor Corp. 6.6000%, 6/15/17 | 65,181 | ||||||||
150,772 | ||||||||||
Electronic Measuring Instruments – 0.2% | ||||||||||
60,000 | Agilent Technologies, Inc. 2.5000%, 7/15/13 | 60,703 | ||||||||
Electronics – Military – 0.5% | ||||||||||
100,000 | L-3 Communications Corp. 6.3750%, 10/15/15 | 103,000 | ||||||||
15,000 | L-3 Communications Corp. 5.2000%, 10/15/19 | 15,249 | ||||||||
24,000 | L-3 Communications Corp. 4.7500%, 7/15/20 | 23,580 | ||||||||
141,829 |
See Notes to Schedules of Investments and Financial Statements.
50 | DECEMBER 31, 2010
Table of Contents
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Finance – Auto Loans – 0.2% | ||||||||||
$50,000 | Ford Motor Credit Co. LLC 7.2500%, 10/25/11 | $ | 51,677 | |||||||
7,000 | Hyundai Capital America 3.7500%, 4/6/16 (144A) | 6,875 | ||||||||
58,552 | ||||||||||
Finance – Credit Card – 0.4% | ||||||||||
50,000 | American Express Co. 6.8000%, 9/1/66‡ | 49,500 | ||||||||
50,000 | American Express Credit Co. 7.3000%, 8/20/13 | 56,343 | ||||||||
105,843 | ||||||||||
Finance – Investment Bankers/Brokers – 0.5% | ||||||||||
50,000 | Charles Schwab Corp. 4.4500%, 7/22/20 | 49,807 | ||||||||
31,000 | Jefferies Group, Inc. 3.8750%, 11/9/15 | 30,470 | ||||||||
21,000 | Lazard Group LLC 7.1250%, 5/15/15 | 22,613 | ||||||||
50,000 | Schwab Capital Trust I 7.5000%, 11/15/37‡ | 51,722 | ||||||||
154,612 | ||||||||||
Food – Meat Products – 0.4% | ||||||||||
100,000 | Tyson Foods, Inc. 7.3500%, 4/1/16 | 109,688 | ||||||||
Food – Miscellaneous/Diversified – 0.7% | ||||||||||
44,000 | Corn Products International, Inc. 3.2000%, 11/1/15 | 44,134 | ||||||||
35,000 | Corn Products International, Inc. 6.6250%, 4/15/37 | 36,586 | ||||||||
50,000 | Kraft Foods, Inc. 5.3750%, 2/10/20 | 53,813 | ||||||||
50,000 | Kraft Foods, Inc. 6.5000%, 2/9/40 | 56,032 | ||||||||
190,565 | ||||||||||
Gambling – Non-Hotel – 0.2% | ||||||||||
50,000 | Jacobs Entertainment, Inc. 9.7500%, 6/15/14 | 48,625 | ||||||||
Hotels and Motels – 0.8% | ||||||||||
18,000 | Hyatt Hotels Corp. 5.7500%, 8/15/15 (144A) | 18,827 | ||||||||
50,000 | Hyatt Hotels Corp. 6.8750%, 8/15/19 (144A) | 54,661 | ||||||||
50,000 | Starwood Hotels & Resorts Worldwide, Inc. 6.7500%, 5/15/18 | 54,750 | ||||||||
50,000 | Starwood Hotels & Resorts Worldwide, Inc. 7.1500%, 12/1/19 | 55,250 | ||||||||
28,000 | Wyndham Worldwide Corp. 5.7500%, 2/1/18 | 28,471 | ||||||||
211,959 | ||||||||||
Investment Management and Advisory Services – 0.4% | ||||||||||
50,000 | Ameriprise Financial, Inc. 5.3000%, 3/15/20 | 52,603 | ||||||||
50,000 | Ameriprise Financial, Inc. 7.5180%, 6/1/66‡ | 52,000 | ||||||||
104,603 | ||||||||||
Medical – Biomedical and Genetic – 0.2% | ||||||||||
26,000 | Celgene Corp. 2.4500%, 10/15/15 | 25,255 | ||||||||
37,000 | Celgene Corp. 3.9500%, 10/15/20 | 35,177 | ||||||||
60,432 | ||||||||||
Medical – Drugs – 0.1% | ||||||||||
25,000 | Abbott Laboratories 4.1250%, 5/27/20 | 25,418 | ||||||||
Medical – Hospitals – 0.6% | ||||||||||
50,000 | HCA, Inc. 9.2500%, 11/15/16 | 53,344 | ||||||||
100,000 | HCA, Inc. 7.2500%, 9/15/20 | 104,500 | ||||||||
157,844 | ||||||||||
Metal – Copper – 0.2% | ||||||||||
50,000 | Freeport-McMoRan Copper & Gold, Inc. 8.3750%, 4/1/17 | 55,313 | ||||||||
Multi-Line Insurance – 0.7% | ||||||||||
39,000 | American International Group, Inc. 6.4000%, 12/15/20 | 40,919 | ||||||||
50,000 | MetLife, Inc. 7.7170%, 2/15/19 | 61,387 | ||||||||
100,000 | MetLife, Inc. 4.7500%, 2/8/21 | 102,102 | ||||||||
204,408 | ||||||||||
Multimedia – 0.3% | ||||||||||
49,000 | NBC Universal, Inc. 2.8750%, 4/1/16 (144A) | 47,871 | ||||||||
28,000 | NBC Universal, Inc. 5.9500%, 4/1/41 (144A) | 27,997 | ||||||||
75,868 | ||||||||||
Oil and Gas Drilling – 0.2% | ||||||||||
64,000 | Nabors Industries, Inc. 5.0000%, 9/15/20 (144A) | 62,083 | ||||||||
Oil Companies – Exploration and Production – 0.4% | ||||||||||
50,000 | Forest Oil Corp. 8.0000%, 12/15/11 | 52,250 | ||||||||
50,000 | Forest Oil Corp. 8.5000%, 2/15/14 | 54,625 | ||||||||
106,875 | ||||||||||
Oil Companies – Integrated – 0.3% | ||||||||||
60,000 | BP Capital Markets PLC 3.1250%, 10/1/15 | 59,959 | ||||||||
28,000 | BP Capital Markets PLC 4.5000%, 10/1/20 | 27,932 | ||||||||
87,891 | ||||||||||
Oil Refining and Marketing – 0.3% | ||||||||||
50,000 | Motiva Enterprises LLC 5.7500%, 1/15/20 (144A) | 56,086 | ||||||||
41,000 | NuStar Logistics L.P. 4.8000%, 9/1/20 | 39,764 | ||||||||
95,850 | ||||||||||
Paper and Related Products – 0.2% | ||||||||||
59,000 | Georgia-Pacific LLC 5.4000%, 11/1/20 (144A) | 58,332 |
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 51
Table of Contents
Perkins Value Plus Income Fund
Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Pipelines – 1.5% | ||||||||||
$50,000 | Crosstex Energy L.P. / Crosstex Energy Finance Corp. 8.8750%, 2/15/18 | $ | 53,562 | |||||||
37,000 | DCP Midstream Operating L.P. 3.2500%, 10/1/15 | 36,392 | ||||||||
50,000 | El Paso Pipeline Partners Operating Co. LLC 6.5000%, 4/1/20 | 52,460 | ||||||||
19,000 | Energy Transfer Equity L.P. 7.5000%, 10/15/20 | 19,570 | ||||||||
50,000 | Kinder Morgan Energy Partners L.P. 5.9500%, 2/15/18 | 55,066 | ||||||||
50,000 | Kinder Morgan Finance Co. ULC 5.7000%, 1/5/16 | 50,625 | ||||||||
50,000 | Plains All American Pipeline L.P. / PAA Finance Corp. 3.9500%, 9/15/15 | 51,664 | ||||||||
72,000 | TransCanada Pipelines, Ltd. 3.8000%, 10/1/20 | 70,259 | ||||||||
39,000 | Williams Partners L.P. 4.1250%, 11/15/20 | 36,940 | ||||||||
426,538 | ||||||||||
Publishing – Newspapers – 0% | ||||||||||
6,000 | Gannett Co., Inc. 6.3750%, 9/1/15 (144A) | 6,045 | ||||||||
Publishing – Periodicals – 0.2% | ||||||||||
58,000 | United Business Media Ltd. 5.7500%, 11/3/20 (144A) | 55,683 | ||||||||
Radio – 0.2% | ||||||||||
50,000 | Sirius XM Radio, Inc. 8.7500%, 4/1/15 (144A) | 54,125 | ||||||||
Real Estate Management/Services – 0.2% | ||||||||||
39,000 | AMB Property L.P. 4.0000%, 1/15/18 | 37,025 | ||||||||
27,000 | CB Richard Ellis Services, Inc. 6.6250%, 10/15/20 (144A) | 27,000 | ||||||||
64,025 | ||||||||||
Real Estate Operating/Development – 0.1% | ||||||||||
37,000 | Post Apartment Homes L.P. 4.7500%, 10/15/17 | 35,521 | ||||||||
REIT – Apartments – 0.1% | ||||||||||
29,000 | BRE Properties, Inc. 5.2000%, 3/15/21 | 29,261 | ||||||||
REIT – Health Care – 0.2% | ||||||||||
29,000 | Ventas Realty L.P. / Ventas Capital Corp. 3.1250%, 11/30/15 | 27,941 | ||||||||
15,000 | Ventas Realty L.P. / Ventas Capital Corp. 6.5000%, 6/1/16 | 15,599 | ||||||||
3,000 | Ventas Realty L.P. / Ventas Capital Corp. 6.7500%, 4/1/17 | 3,144 | ||||||||
46,684 | ||||||||||
REIT – Hotels – 0.3% | ||||||||||
25,000 | Host Hotels & Resorts L.P. 7.1250%, 11/1/13 | 25,375 | ||||||||
55,000 | Host Hotels & Resorts L.P. 6.7500%, 6/1/16 | 56,169 | ||||||||
81,544 | ||||||||||
REIT – Regional Malls – 0.4% | ||||||||||
64,000 | Rouse Co. L.P. 6.7500%, 5/1/13 (144A) | 66,320 | ||||||||
47,000 | Rouse Co. L.P. 6.7500%, 11/9/15 | 48,645 | ||||||||
114,965 | ||||||||||
REIT – Warehouse and Industrial – 0.1% | ||||||||||
33,000 | ProLogis 6.6250%, 5/15/18 | 35,039 | ||||||||
2,000 | ProLogis 6.8750%, 3/15/20 | 2,124 | ||||||||
37,163 | ||||||||||
Resorts and Theme Parks – 0.2% | ||||||||||
50,000 | Vail Resorts, Inc. 6.7500%, 2/15/14 | 50,625 | ||||||||
Retail – Apparel and Shoe – 0.8% | ||||||||||
50,000 | Burlington Coat Factory Warehouse Corp. 11.1250%, 4/15/14 | 51,625 | ||||||||
150,000 | Phillips-Van Heusen Corp. 7.3750%, 5/15/20 | 159,375 | ||||||||
211,000 | ||||||||||
Retail – Auto Parts – 0.1% | ||||||||||
39,000 | AutoZone, Inc. 4.0000%, 11/15/20 | 36,834 | ||||||||
Retail – Major Department Stores – 0.2% | ||||||||||
50,000 | JC Penney Co., Inc. 5.6500%, 6/1/20 | 47,875 | ||||||||
Retail – Propane Distribution – 0.2% | ||||||||||
50,000 | Amerigas Partners L.P. 7.2500%, 5/20/15 | 51,375 | ||||||||
Retail – Regional Department Stores – 0.4% | ||||||||||
50,000 | Macy’s Retail Holdings, Inc. 5.9000%, 12/1/16 | 53,375 | ||||||||
50,000 | Macy’s Retail Holdings, Inc. 6.9000%, 4/1/29 | 49,125 | ||||||||
102,500 | ||||||||||
Retail – Toy Store – 0.2% | ||||||||||
50,000 | Toys R Us Property Co., LLC 8.5000%, 12/1/17 | 53,750 | ||||||||
Steel – Producers – 0.3% | ||||||||||
58,000 | ArcelorMittal 5.2500%, 8/5/20 | 57,340 | ||||||||
30,000 | Steel Dynamics, Inc. 7.6250%, 3/15/20 (144A) | 32,100 | ||||||||
89,440 | ||||||||||
Super-Regional Banks – 0.2% | ||||||||||
12,000 | Comerica, Inc. 3.0000%, 9/16/15 | 11,863 | ||||||||
50,000 | PNC Funding Corp. 5.1250%, 2/8/20 | 52,114 | ||||||||
63,977 |
See Notes to Schedules of Investments and Financial Statements.
52 | DECEMBER 31, 2010
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Schedule of Investments (unaudited)
As of December 31, 2010
Shares or Principal Amount | Value | |||||||||
Telecommunication Services – 0.6% | ||||||||||
$50,000 | Clearwire Communications LLC 12.0000%, 12/1/15 (144A) | $ | 53,875 | |||||||
100,000 | Virgin Media Secured Finance PLC 6.5000%, 1/15/18 | 105,250 | ||||||||
159,125 | ||||||||||
Telephone – Integrated – 1.1% | ||||||||||
50,000 | Qwest Communications International, Inc. 7.5000%, 2/15/14 | 50,625 | ||||||||
121,000 | Qwest Communications International, Inc. 7.1250%, 4/1/18 (144A) | 125,235 | ||||||||
100,000 | Sprint Capital Corp. 7.6250%, 1/30/11 | 100,250 | ||||||||
25,000 | Sprint Capital Corp. 8.3750%, 3/15/12 | 26,438 | ||||||||
302,548 | ||||||||||
Television – 0% | ||||||||||
10,000 | CBS Corp. 4.3000%, 2/15/21 | 9,495 | ||||||||
Toys – 0% | ||||||||||
8,000 | Mattel, Inc. 4.3500%, 10/1/20 | 7,752 | ||||||||
Transportation – Railroad – 0.5% | ||||||||||
100,000 | Kansas City Southern de Mexico S.A. de C.V. 8.0000%, 2/1/18 | 108,250 | ||||||||
20,000 | Kansas City Southern de Mexico S.A. de C.V. 6.6250%, 12/15/20 (144A) | 20,050 | ||||||||
128,300 | ||||||||||
Transportation – Services – 0.2% | ||||||||||
57,000 | Asciano Finance, Ltd. 4.6250%, 9/23/20 (144A) | 52,862 | ||||||||
15,000 | Ryder System, Inc. 3.6000%, 3/1/16 | 14,954 | ||||||||
67,816 | ||||||||||
Transportation – Truck – 0.2% | ||||||||||
55,000 | JB Hunt Transport Services, Inc. 3.3750%, 9/15/15 | 54,328 | ||||||||
Total Corporate Bonds (cost $8,147,978) | 8,175,254 | |||||||||
Preferred Stock – 0.1% | ||||||||||
Diversified Banking Institutions – 0.1% | ||||||||||
525 | Citigroup Capital, 7.8750% (cost $13,125) | 14,128 | ||||||||
U.S. Treasury Notes/Bonds – 7.2% | ||||||||||
U.S. Treasury Notes/Bonds: | ||||||||||
$100,000 | 0.8750%, 5/31/11 | 100,285 | ||||||||
100,000 | 1.1250%, 6/30/11 | 100,461 | ||||||||
100,000 | 1.0000%, 10/31/11 | 100,586 | ||||||||
100,000 | 1.1250%, 1/15/12 | 100,801 | ||||||||
100,000 | 4.6250%, 2/29/12 | 104,894 | ||||||||
100,000 | 1.3750%, 5/15/12 | 101,328 | ||||||||
50,000 | 0.6250%, 7/31/12 | 50,137 | ||||||||
95,000 | 0.3750%, 8/31/12 | 94,829 | ||||||||
100,000 | 1.3750%, 1/15/13 | 101,523 | ||||||||
100,000 | 1.3750%, 2/15/13 | 101,508 | ||||||||
50,000 | 1.7500%, 4/15/13 | 51,149 | ||||||||
70,000 | 0.7500%, 8/15/13 | 69,858 | ||||||||
100,000 | 2.7500%, 10/31/13 | 105,117 | ||||||||
150,000 | 1.8750%, 2/28/14 | 153,609 | ||||||||
50,000 | 1.7500%, 3/31/14 | 50,980 | ||||||||
100,000 | 2.2500%, 5/31/14 | 103,445 | ||||||||
150,000 | 2.3750%, 8/31/14 | 155,391 | ||||||||
11,000 | 2.3750%, 9/30/14 | 11,394 | ||||||||
45,000 | 2.6250%, 12/31/14 | 46,923 | ||||||||
58,532 | 0.5000%, 4/15/15ÇÇ | 59,831 | ||||||||
25,000 | 1.8750%, 6/30/15 | 25,100 | ||||||||
13,037 | 1.2500%, 7/15/20ÇÇ | 13,348 | ||||||||
35,000 | 2.6250%, 11/15/20 | 33,015 | ||||||||
28,000 | 5.2500%, 2/15/29 | 32,113 | ||||||||
58,000 | 3.8750%, 8/15/40 | 53,423 | ||||||||
106,000 | 4.2500%, 11/15/40 | 104,278 | ||||||||
Total U.S. Treasury Notes/Bonds (cost $2,024,605) | 2,025,326 | |||||||||
Short-Term Taxable Variable Rate Demand Note – 0.1% | ||||||||||
25,000 | State of California Build America Bonds – Variable Purpose 7.5500%, 4/1/39 (cost $27,661) | 25,928 | ||||||||
Money Market – 7.7% | ||||||||||
2,145,838 | Janus Cash Liquidity Fund LLC, 0% (cost $2,145,838) | 2,145,838 | ||||||||
Total Investments (total cost $26,283,254) – 99.6% | 27,801,129 | |||||||||
Cash, Receivables and Other Assets, net of Liabilities – 0.4% | 100,143 | |||||||||
Net Assets – 100% | $ | 27,901,272 | ||||||||
Summary of Investments by Country – (Long Positions)
% of Investment | ||||||||
Country | Value | Securities | ||||||
Australia | $ | 135,753 | 0.5% | |||||
Bermuda | 410,078 | 1.5% | ||||||
Canada | 132,021 | 0.5% | ||||||
Cayman Islands | 17,822 | 0.1% | ||||||
Ireland | 190,036 | 0.7% | ||||||
Luxembourg | 83,301 | 0.3% | ||||||
Mexico | 128,300 | 0.5% | ||||||
Netherlands Antilles | 41,750 | 0.1% | ||||||
South Korea | 121,095 | 0.4% | ||||||
Switzerland | 588,300 | 2.1% | ||||||
United Kingdom | 656,189 | 2.3% | ||||||
United States†† | 25,296,484 | 91.0% | ||||||
Total | $ | 27,801,129 | 100.0% |
†† | Includes Cash Equivalents (83.3% excluding Cash Equivalents). |
Schedule of Written Options – Calls | Value | |||
Freeport-McMoRan Copper & Gold, Inc. expires January 2011 3 contracts exercise price $130.00 | $ | (288) | ||
Noble Energy, Inc. expires January 2011 4 contracts exercise price $95.00 | (100) | |||
Total Schedule of Written Options – Calls (premiums received $314 ) | $ | (388) | ||
See Notes to Schedules of Investments and Financial Statements.
Janus Value Funds | 53
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Statements of Assets and Liabilities
As of December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands except net asset value per share) | Perkins Large Cap Value Fund | Perkins Mid Cap Value Fund | Perkins Small Cap Value Fund | Perkins Value Plus Income Fund(1) | ||||||||||||
Assets: | ||||||||||||||||
Investments at cost | $ | 91,822 | $ | 11,781,187 | $ | 2,865,311 | $ | 26,283 | ||||||||
Unaffiliated investments at value | $ | 94,013 | $ | 11,905,380 | $ | 2,467,669 | $ | 25,655 | ||||||||
Affiliated investments at value | – | 892,265 | 257,405 | 2,146 | ||||||||||||
Repurchase agreements | 9,944 | 1,214,591 | 581,803 | – | ||||||||||||
Cash | 50 | – | 401 | 81 | ||||||||||||
Receivables: | ||||||||||||||||
Investments sold | 202 | 82,675 | 11,683 | 20 | ||||||||||||
Fund shares sold | 3,085 | 16,534 | 153,131 | 29 | ||||||||||||
Dividends | 103 | 12,679 | 1,719 | 30 | ||||||||||||
Foreign dividend tax reclaim | 1 | – | – | – | ||||||||||||
Due from adviser | – | – | – | 17 | ||||||||||||
Interest | – | 9 | 2 | 134 | ||||||||||||
Non-interested Trustees’ deferred compensation | 3 | 389 | 92 | 1 | ||||||||||||
Other assets | 2 | 128 | 24 | 57 | ||||||||||||
Total Assets | 107,403 | 14,124,650 | 3,473,929 | 28,170 | ||||||||||||
Liabilities: | ||||||||||||||||
Payables: | ||||||||||||||||
Options written, at value(2) | – | 5,820 | – | – | ||||||||||||
Due to custodian | – | 665 | – | – | ||||||||||||
Investments purchased | 5,578 | 84,298 | 12,346 | 205 | ||||||||||||
Fund shares repurchased | 53 | 32,898 | 154,162 | 10 | ||||||||||||
Dividends | – | 2 | 43 | 2 | ||||||||||||
Advisory fees | 55 | 8,572 | 2,106 | 13 | ||||||||||||
Administrative services fees | 1 | 1,916 | 397 | 3 | ||||||||||||
Distribution fees and shareholder servicing fees | 2 | 661 | 95 | 5 | ||||||||||||
Administrative, networking and omnibus fees | 1 | 18 | – | – | ||||||||||||
Non-interested Trustees’ fees and expenses | – | 80 | 17 | – | ||||||||||||
Non-interested Trustees’ deferred compensation fees | 3 | 389 | 92 | 1 | ||||||||||||
Accrued expenses and other payables | 50 | 471 | 78 | 30 | ||||||||||||
Total Liabilities | 5,743 | 135,790 | 169,336 | 269 | ||||||||||||
Net Assets | $ | 101,660 | $ | 13,988,860 | $ | 3,304,593 | $ | 27,901 |
See footnotes at the end of the Statements.
See Notes to Financial Statements.
54 | DECEMBER 31, 2010
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Statements of Assets and Liabilities (continued)
As of December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands except net asset value per share) | Perkins Large Cap Value Fund | Perkins Mid Cap Value Fund | Perkins Small Cap Value Fund | Perkins Value Plus Income Fund(1) | ||||||||||||
Net Assets Consist of: | ||||||||||||||||
Capital (par value and paid-in surplus)* | $ | 88,627 | $ | 11,948,617 | $ | 2,801,572 | $ | 26,151 | ||||||||
Undistributed net investment income* | 33 | 7,709 | 11,066 | 13 | ||||||||||||
Undistributed net realized gain/(loss) from investment and foreign currency transactions* | 865 | (210,967) | 50,387 | 219 | ||||||||||||
Unrealized net appreciation of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 12,135 | 2,243,501 | 441,568 | 1,518 | ||||||||||||
Total Net Assets | $ | 101,660 | $ | 13,988,860 | $ | 3,304,593 | $ | 27,901 | ||||||||
Net Assets - Class A Shares | $ | 836 | $ | 1,244,666 | $ | 204,916 | $ | 4,040 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 62 | 55,177 | 8,554 | 375 | ||||||||||||
Net Asset Value Per Share(3) | $ | 13.52 | $ | 22.56 | $ | 23.95 | $ | 10.78 | ||||||||
Maximum Offering Price Per Share(4) | $ | 14.34 | $ | 23.94 | $ | 25.41 | $ | 11.44 | ||||||||
Net Assets - Class C Shares | $ | 2,031 | $ | 214,632 | $ | 29,872 | $ | 3,678 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 152 | 9,550 | 1,258 | 341 | ||||||||||||
Net Asset Value Per Share(3) | $ | 13.37 | $ | 22.47 | $ | 23.75 | $ | 10.78 | ||||||||
Net Assets - Class D Shares | $ | 4,804 | $ | 918,579 | $ | 85,953 | $ | 7,126 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 357 | 40,701 | 3,583 | 661 | ||||||||||||
Net Asset Value Per Share | $ | 13.45 | $ | 22.57 | $ | 23.99 | $ | 10.78 | ||||||||
Net Assets - Class I Shares | $ | 91,932 | $ | 2,908,085 | $ | 1,257,133 | $ | 5,521 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 6,829 | 128,857 | 52,304 | 512 | ||||||||||||
Net Asset Value Per Share | $ | 13.46 | $ | 22.57 | $ | 24.04 | $ | 10.78 | ||||||||
Net Assets - Class L Shares | $ | N/A | $ | 68,831 | $ | 319,953 | $ | N/A | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | N/A | 3,028 | 13,146 | N/A | ||||||||||||
Net Asset Value Per Share | $ | N/A | $ | 22.73 | $ | 24.34 | $ | N/A | ||||||||
Net Assets - Class R Shares | $ | N/A | $ | 150,684 | $ | 28,659 | $ | N/A | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | N/A | 6,691 | 1,203 | N/A | ||||||||||||
Net Asset Value Per Share | $ | N/A | $ | 22.52 | $ | 23.82 | $ | N/A | ||||||||
Net Assets - Class S Shares | $ | 695 | $ | 771,350 | $ | 87,409 | $ | 3,639 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 52 | 34,213 | 3,654 | 338 | ||||||||||||
Net Asset Value Per Share | $ | 13.47 | $ | 22.55 | $ | 23.92 | $ | 10.78 | ||||||||
Net Assets - Class T Shares | $ | 1,362 | $ | 7,712,033 | $ | 1,290,698 | $ | 3,897 | ||||||||
Shares Outstanding, $0.01 Par Value (unlimited shares authorized) | 101 | 341,692 | 53,833 | 362 | ||||||||||||
Net Asset Value Per Share | $ | 13.43 | $ | 22.57 | $ | 23.98 | $ | 10.78 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from July 30, 2010 (inception date) through December 31, 2010. | |
(2) | Includes premiums of $18,263,693 and $314 on written options for Perkins Mid Cap Value Fund and Perkins Value Plus Income Fund, respectively. | |
(3) | Redemption price per share may be reduced for any applicable contingent deferred sales charge. | |
(4) | Maximum offering price is computed at 100/94.25 of net asset value. | |
See Notes to Financial Statements.
56 | DECEMBER 31, 2010
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Statements of Operations
For the six-month period ended December 31, 2010 (unaudited) | ||||||||||||||||
(all numbers in thousands) | Perkins Large Cap Value Fund | Perkins Mid Cap Value Fund | Perkins Small Cap Value Fund | Perkins Value Plus Income Fund(1) | ||||||||||||
Investment Income: | ||||||||||||||||
Interest | $ | 7 | $ | 1,136 | $ | 450 | $ | 187 | ||||||||
Dividends | 1,105 | 150,798 | 23,522 | 161 | ||||||||||||
Dividends from affiliates | – | 4,698 | 1,740 | 1 | ||||||||||||
Fee income | – | – | – | 1 | ||||||||||||
Foreign tax withheld | (1) | (68) | – | – | ||||||||||||
Total Investment Income | 1,111 | 156,564 | 25,712 | 350 | ||||||||||||
Expenses: | ||||||||||||||||
Advisory fees | 293 | 47,637 | 11,599 | 58 | ||||||||||||
Shareholder reports expense | 14 | 1,554 | 272 | – | ||||||||||||
Transfer agent fees and expenses | 8 | 189 | 44 | 13 | ||||||||||||
Registration fees | 52 | 268 | 158 | 63 | ||||||||||||
Custodian fees | 4 | 73 | 13 | 3 | ||||||||||||
Professional fees | 30 | 103 | 42 | 21 | ||||||||||||
Non-interested Trustees’ fees and expenses | 2 | 263 | 58 | – | ||||||||||||
Administrative services fees - Class D Shares | 2 | 513 | 49 | 2 | ||||||||||||
Administrative services fees - Class L Shares | N/A | 82 | 601 | N/A | ||||||||||||
Administrative services fees - Class R Shares | N/A | 161 | 36 | N/A | ||||||||||||
Administrative services fees - Class S Shares | 1 | 843 | 83 | 4 | ||||||||||||
Administrative services fees - Class T Shares | 1 | 9,129 | 1,415 | 4 | ||||||||||||
Distribution fees and shareholder servicing fees - Class A Shares | 1 | 1,409 | 174 | 4 | ||||||||||||
Distribution fees and shareholder servicing fees - Class C Shares | 8 | 949 | 142 | 14 | ||||||||||||
Distribution fees and shareholder servicing fees - Class R Shares | N/A | 321 | 71 | N/A | ||||||||||||
Distribution fees and shareholder servicing fees - Class S Shares | 1 | 843 | 84 | 4 | ||||||||||||
Administrative, networking and omnibus fees - Class A Shares | 1 | 801 | 73 | – | ||||||||||||
Administrative, networking and omnibus fees - Class C Shares | 1 | 113 | 22 | – | ||||||||||||
Administrative, networking and omnibus fees - Class I Shares | 5 | 1,108 | 186 | – | ||||||||||||
Other expenses | 4 | 310 | 66 | 12 | ||||||||||||
Non-recurring costs (Note 4) | N/A | 1 | 1 | N/A | ||||||||||||
Costs assumed by Janus Capital Management LLC (Note 4) | N/A | (1) | (1) | N/A | ||||||||||||
Total Expenses | 428 | 66,669 | 15,188 | 202 | ||||||||||||
Expense and Fee Offset | – | (5) | (1) | – | ||||||||||||
Net Expenses | 428 | 66,664 | 15,187 | 202 | ||||||||||||
Less: Excess Expense Reimbursement | (1) | (82) | (607) | (87) | ||||||||||||
Net Expenses after Expense Reimbursement | 427 | 66,582 | 14,580 | 115 | ||||||||||||
Net Investment Income | 684 | 89,982 | 11,132 | 235 | ||||||||||||
Net Realized and Unrealized Gain/(Loss) on Investments: | ||||||||||||||||
Net realized gain from investment and foreign currency transactions(2) | 1,918 | 619,895 | 113,987 | 328 | ||||||||||||
Net realized gain/(loss) from futures contracts | (70) | – | – | – | ||||||||||||
Net realized gain/(loss) from options contracts | – | (114,687) | – | – | ||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 13,077 | 1,676,465 | 359,224 | 1,517 | ||||||||||||
Net Gain on Investments | 14,925 | 2,181,673 | 473,211 | 1,845 | ||||||||||||
Net Increase in Net Assets Resulting from Operations | $ | 15,609 | $ | 2,271,655 | $ | 484,343 | $ | 2,080 |
(1) | Period from July 30, 2010 (inception date) through December 31, 2010. | |
(2) | Includes realized gain/(loss) from affiliated investment companies. See affiliates table in Notes to Schedules of Investments. | |
See Notes to Financial Statements.
58 | DECEMBER 31, 2010
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Statements of Changes in Net Assets
For the six-month period ended December 31, 2010 (unaudited), the eight- or eleven- | ||||||||||||||||||||||||||||||||||||||||
month fiscal period ended June 30, 2010 and the fiscal year ended October 31, 2009 | Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | ||||||||||||||||||||||||||||||||||||
or July 31, 2009 | Value Fund | Value Fund | Value Fund | Income Fund | ||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009 | 2010 | 2010(3) | 2009 | 2010(4) | ||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||||||||||
Net investment income | $ | 684 | $ | 382 | $ | 145 | $ | 89,982 | $ | 37,542 | $ | 56,738 | $ | 11,132 | $ | 6,850 | $ | 12,682 | $ | 235 | ||||||||||||||||||||
Net realized gain/(loss) from investment and foreign currency transactions(5) | 1,918 | 1,597 | 11 | 619,895 | 496,209 | (824,044) | 113,987 | 176,729 | (152,057) | 328 | ||||||||||||||||||||||||||||||
Net realized gain/(loss) from futures contracts | (70) | 65 | (388) | – | – | – | – | – | – | – | ||||||||||||||||||||||||||||||
Net realized gain/(loss) from options contracts | – | – | – | (114,687) | (126,447) | 41,325 | – | – | – | – | ||||||||||||||||||||||||||||||
Change in unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation | 13,077 | (3,766) | 2,825 | 1,676,465 | (250,397) | 2,224,553 | 359,224 | (89,174) | 367,791 | 1,517 | ||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Net Assets Resulting from Operations | 15,609 | (1,722) | 2,593 | 2,271,655 | 156,907 | 1,498,572 | 484,343 | 94,405 | 228,416 | 2,080 | ||||||||||||||||||||||||||||||
Dividends and Distributions to Shareholders: | ||||||||||||||||||||||||||||||||||||||||
Net Investment Income* | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (2) | (4) | (2) | (7,649) | (1,093) | – | (825) | – | – | (35) | ||||||||||||||||||||||||||||||
Class C Shares | (4) | – | – | (42) | – | – | (20) | – | – | (23) | ||||||||||||||||||||||||||||||
Class D Shares | (42) | – | N/A | (7,218) | – | N/A | (324) | – | N/A | (51) | ||||||||||||||||||||||||||||||
Class I Shares | (822) | (156) | (91) | (25,831) | (4,581) | – | (5,252) | – | – | (49) | ||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | (566) | (1,021) | (5,821) | (2,079) | – | (11,913) | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | (569) | (2) | – | (95) | – | – | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (4) | – | – | (4,198) | (491) | – | (266) | – | – | (30) | ||||||||||||||||||||||||||||||
Class T Shares | (9) | – | – | (54,317) | (13,927) | (84,359) | (4,598) | – | (8,212) | (34) | ||||||||||||||||||||||||||||||
Net Realized Gain/(Loss) from Investment Transactions* | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (20) | (3) | – | – | – | – | (4,904) | – | – | (15) | ||||||||||||||||||||||||||||||
Class C Shares | (47) | (1) | – | – | – | – | (742) | – | – | (15) | ||||||||||||||||||||||||||||||
Class D Shares | (100) | – | N/A | – | – | N/A | (2,118) | – | N/A | (27) | ||||||||||||||||||||||||||||||
Class I Shares | (2,000) | (100) | – | – | – | – | (27,280) | – | – | (22) | ||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | – | – | (13,958) | (11,495) | – | (47,807) | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | – | – | – | (698) | – | – | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (16) | (1) | – | – | – | – | (2,120) | – | – | (14) | ||||||||||||||||||||||||||||||
Class T Shares | (24) | – | – | – | – | (246,288) | (31,971) | – | (44,332) | (15) | ||||||||||||||||||||||||||||||
Return of Capital | ||||||||||||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | (2,063) | N/A | ||||||||||||||||||||||||||||||
Class T Shares | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | (1,484) | N/A | ||||||||||||||||||||||||||||||
Net Decrease from Dividends and Distributions | (3,090) | (265) | (93) | (100,390) | (21,115) | (350,426) | (94,787) | – | (115,811) | (330) | ||||||||||||||||||||||||||||||
Capital Share Transactions: | ||||||||||||||||||||||||||||||||||||||||
Shares Sold | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | 207 | 1,737 | 674 | 216,053 | 377,846 | 158,332 | 127,572 | 75,696 | 11,204 | 3,723 | ||||||||||||||||||||||||||||||
Class C Shares | 565 | 1,010 | 500 | 32,847 | 65,569 | 29,160 | 3,723 | 22,303 | 4,122 | 3,379 | ||||||||||||||||||||||||||||||
Class D Shares | 2,284 | 3,044 | N/A | 36,939 | 35,545 | N/A | 3,978 | 27,133 | N/A | 6,800 | ||||||||||||||||||||||||||||||
Class I Shares | 12,156 | 45,326 | 29,470 | 577,021 | 1,251,652 | 352,580 | 685,098 | 409,944 | 233,119 | 5,102 | ||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | 5,671 | 51,104 | 112,534 | 29,110 | 65,179 | 246,475 | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | 42,233 | 51,643 | 21,222 | 17,631 | 20,371 | 760 | N/A | ||||||||||||||||||||||||||||||
Class S Shares | 5 | – | �� | 500 | 181,014 | 277,192 | 111,281 | 34,458 | 38,815 | 6,215 | 3,333 | |||||||||||||||||||||||||||||
Class T Shares | 786 | 653 | 1 | 848,291 | 1,605,612 | 2,899,132 | 263,508 | 661,799 | 327,680 | 3,622 | ||||||||||||||||||||||||||||||
Shares Issued in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||
Class D Shares | N/A | N/A | N/A | N/A | 829,021 | N/A | N/A | 58,840 | N/A | N/A | ||||||||||||||||||||||||||||||
Shares Issued in Connection with Acquisition (Note 10) | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | N/A | N/A | N/A | N/A | N/A | 663,866 | N/A | N/A | 10,144 | N/A | ||||||||||||||||||||||||||||||
Class C Shares | N/A | N/A | N/A | N/A | N/A | 89,080 | N/A | N/A | 2,010 | N/A | ||||||||||||||||||||||||||||||
Class I Shares | N/A | N/A | N/A | N/A | N/A | 853,788 | N/A | N/A | 5,513 | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | N/A | N/A | 47,867 | N/A | N/A | 2,921 | N/A | ||||||||||||||||||||||||||||||
Class S Shares | N/A | N/A | N/A | N/A | N/A | 313,849 | N/A | N/A | 15,455 | N/A | ||||||||||||||||||||||||||||||
Class T Shares | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 1,832 | N/A |
See footnotes at the end of the Statements.
See Notes to Financial Statements.
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Statements of Changes in Net Assets (continued)
For the six-month period ended December 31, 2010 (unaudited), the eight- or | ||||||||||||||||||||||||||||||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal year ended | Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | ||||||||||||||||||||||||||||||||||||
October 31, 2009 or July 31, 2009 | Value Fund | Value Fund | Value Fund | Income Fund | ||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009 | 2010 | 2010(3) | 2009 | 2010(4) | ||||||||||||||||||||||||||||||
Reinvested Dividends and Distributions | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | 21 | 4 | 2 | 6,592 | 922 | – | 4,373 | – | – | 50 | ||||||||||||||||||||||||||||||
Class C Shares | 40 | 1 | – | 29 | – | – | 577 | – | – | 38 | ||||||||||||||||||||||||||||||
Class D Shares | 141 | – | N/A | 7,020 | – | N/A | 2,393 | – | N/A | 71 | ||||||||||||||||||||||||||||||
Class I Shares | 2,704 | 255 | 91 | 20,679 | 3,307 | – | 22,564 | – | – | 70 | ||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | 515 | 1,000 | 18,926 | 13,145 | – | 60,646 | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | 496 | 2 | – | 609 | – | – | N/A | ||||||||||||||||||||||||||||||
Class S Shares | 20 | 1 | – | 4,187 | 482 | – | 2,386 | – | – | 44 | ||||||||||||||||||||||||||||||
Class T Shares | 33 | – | – | 52,353 | 13,396 | 319,498 | 35,829 | – | 52,497 | 49 | ||||||||||||||||||||||||||||||
Shares Repurchased | ||||||||||||||||||||||||||||||||||||||||
Class A Shares | (1,191) | (818) | (27) | (179,223) | (152,773) | (84,083) | (32,029) | (7,918) | (1,662) | – | ||||||||||||||||||||||||||||||
Class C Shares | (152) | (168) | – | (18,803) | (17,723) | (7,048) | (4,973) | (1,150) | (120) | N/A | ||||||||||||||||||||||||||||||
Class D Shares | (506) | (322) | N/A | (65,062) | (49,520) | N/A | (9,588) | (6,354) | N/A | (90) | ||||||||||||||||||||||||||||||
Class I Shares | (3,626) | (3,596) | (3,016) | (346,542) | (263,968) | (74,692) | (103,402) | (121,195) | (2,098) | (2) | ||||||||||||||||||||||||||||||
Class L Shares | N/A | N/A | N/A | (10,267) | (365,859) | (175,832) | (450,090) | (166,233) | (248,613) | N/A | ||||||||||||||||||||||||||||||
Class R Shares | N/A | N/A | N/A | (17,894) | (18,567) | (6,362) | (14,935) | (1,983) | (354) | N/A | ||||||||||||||||||||||||||||||
Class S Shares | (5) | – | – | (97,772) | (142,151) | (45,609) | (9,810) | (15,269) | (2,931) | N/A | ||||||||||||||||||||||||||||||
Class T Shares | (167) | (9) | – | (1,243,528) | (1,434,412) | (1,942,713) | (171,563) | (289,837) | (245,452) | (38) | ||||||||||||||||||||||||||||||
Shares Reorganized in Connection with Restructuring (Note 9) | ||||||||||||||||||||||||||||||||||||||||
Class T Shares | N/A | N/A | N/A | N/A | (829,021) | N/A | N/A | (58,840) | N/A | N/A | ||||||||||||||||||||||||||||||
Net Increase from Capital Share Transactions | 13,315 | 47,118 | 28,195 | 52,849 | 1,290,299 | 3,654,776 | 450,564 | 711,301 | 479,363 | 26,151 | ||||||||||||||||||||||||||||||
Net Increase in Net Assets | 25,834 | 45,131 | 30,695 | 2,224,114 | 1,426,091 | 4,802,922 | 840,120 | 805,706 | 591,968 | 27,901 | ||||||||||||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||||||||||
Beginning of period | 75,826 | 30,695 | – | 11,764,746 | 10,338,655 | 5,535,733 | 2,464,473 | 1,658,767 | 1,066,799 | – | ||||||||||||||||||||||||||||||
End of period | $ | 101,660 | $ | 75,826 | $ | 30,695 | $ | 13,988,860 | $ | 11,764,746 | $ | 10,338,655 | $ | 3,304,593 | $ | 2,464,473 | $ | 1,658,767 | $ | 27,901 | ||||||||||||||||||||
Undistributed Net Investment Income/(Loss)* | $ | 33 | $ | 232 | $ | 31 | $ | 7,709 | $ | 18,117 | $ | 2,773 | $ | 11,066 | $ | 13,393 | $ | (40) | $ | 13 |
* | See Note 5 in Notes to Financial Statements. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(3) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(4) | Period from July 30, 2010 (inception date) through December 31, 2010. | |
(5) | Includes realized gain/(loss) from affiliated investment companies. See affiliates table in Notes to Schedules of Investments. | |
See Notes to Financial Statements.
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Financial Highlights
Class A Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Large Cap Value Fund | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $11.56 | $11.14 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .19 | .03 | .05 | |||||||||||
Net gain on investments (both realized and unrealized) | 2.12 | .44 | 1.11 | |||||||||||
Total from Investment Operations | 2.31 | .47 | 1.16 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.03) | (.03) | (.02) | |||||||||||
Distributions (from capital gains)* | (.32) | (.02) | – | |||||||||||
Total Distributions and Other | (.35) | (.05) | (.02) | |||||||||||
Net Asset Value, End of Period | $13.52 | $11.56 | $11.14 | |||||||||||
Total Return** | 20.08% | 4.20% | 11.64% | |||||||||||
Net Assets, End of Period (in thousands) | $836 | $1,654 | $718 | |||||||||||
Average Net Assets for the Period (in thousands) | $974 | $1,514 | $530 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.31% | 1.29% | 1.23% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.31% | 1.29% | 1.23% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.98% | 0.48% | 1.19% | |||||||||||
Portfolio Turnover Rate*** | 44% | 35% | 57% |
Class A Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), | Perkins Mid Cap Value Fund | |||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | |||||||||||
Net Asset Value, Beginning of Period | $19.04 | $18.66 | $16.07 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .13 | .04 | (.01) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.53 | .36 | 2.60 | |||||||||||
Total from Investment Operations | 3.66 | .40 | 2.59 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.14) | (.02) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.14) | (.02) | – | |||||||||||
Net Asset Value, End of Period | $22.56 | $19.04 | $18.66 | |||||||||||
Total Return** | 19.23% | 2.17% | 16.12% | |||||||||||
Net Assets, End of Period (in thousands) | $1,244,666 | $1,011,334 | $781,960 | |||||||||||
Average Net Assets for the Period (in thousands) | $1,118,081 | $966,540 | $736,402 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.17% | 1.17% | 1.22% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.17% | 1.17% | 1.22% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.25% | 0.33% | 0.35% | |||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. |
See Notes to Financial Statements.
64 | DECEMBER 31, 2010
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Class A Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Small Cap Value Fund | |||||||||||||
eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $20.92 | $19.48 | $16.47 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .04 | .09 | (.07) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.70 | 1.35 | 3.08 | |||||||||||
Total from Investment Operations | 3.74 | 1.44 | 3.01 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.10) | – | – | |||||||||||
Distributions (from capital gains)* | (.61) | – | – | |||||||||||
Total Distributions and Other | (.71) | – | – | |||||||||||
Net Asset Value, End of Period | $23.95 | $20.92 | $19.48 | |||||||||||
Total Return** | 17.91% | 7.39% | 18.28% | |||||||||||
Net Assets, End of Period (in thousands) | $204,916 | $86,403 | $20,039 | |||||||||||
Average Net Assets for the Period (in thousands) | $137,897 | $52,788 | $13,537 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.21% | 1.21% | 0.97% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.21% | 1.21% | 0.96% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.56% | 0.06% | 0.62% | |||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% |
Class A Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income/(loss) | .11 | |||||
Net gain on investments (both realized and unrealized) | .81 | |||||
Total from Investment Operations | .92 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.10) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.14) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 9.28% | |||||
Net Assets, End of Period (in thousands) | $4,040 | |||||
Average Net Assets for the Period (in thousands) | $3,551 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.08% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.08% | |||||
Ratio of Net Investment Income to Average Net Assets*** | 2.45% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 65
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Financial Highlights (continued)
Class C Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Large Cap Value Fund | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $11.48 | $11.11 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .03 | (.03) | .02 | |||||||||||
Net gain on investments (both realized and unrealized) | 2.21 | .42 | 1.09 | |||||||||||
Total from Investment Operations | 2.24 | .39 | 1.11 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.03) | – | – | |||||||||||
Distributions (from capital gains)* | (.32) | (.02) | – | |||||||||||
Total Distributions and Other | (.35) | (.02) | – | |||||||||||
Net Asset Value, End of Period | $13.37 | $11.48 | $11.11 | |||||||||||
Total Return** | 19.58% | 3.54% | 11.10% | |||||||||||
Net Assets, End of Period (in thousands) | $2,031 | $1,336 | $556 | |||||||||||
Average Net Assets for the Period (in thousands) | $1,635 | $929 | $484 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 2.06% | 2.04% | 1.98% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 2.06% | 2.04% | 1.97% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.49% | (0.23)% | 0.48% | |||||||||||
Portfolio Turnover Rate*** | 44% | 35% | 57% |
Class C Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), | Perkins Mid Cap Value Fund | |||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | |||||||||||
Net Asset Value, Beginning of Period | $18.93 | $18.62 | $16.07 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .06 | (.04) | (.05) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.48 | .35 | 2.60 | |||||||||||
Total from Investment Operations | 3.54 | .31 | 2.55 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | – | – | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | – | – | – | |||||||||||
Net Asset Value, End of Period | $22.47 | $18.93 | $18.62 | |||||||||||
Total Return** | 18.72% | 1.66% | 15.87% | |||||||||||
Net Assets, End of Period (in thousands) | $214,632 | $168,093 | $121,166 | |||||||||||
Average Net Assets for the Period (in thousands) | $188,173 | $155,180 | $107,362 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.90% | 1.91% | 1.97% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.90% | 1.91% | 1.97% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.51% | (0.41)% | (0.41)% | |||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. |
See Notes to Financial Statements.
66 | DECEMBER 31, 2010
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Class C Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Small Cap Value Fund | |||||||||||||
eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $20.75 | $19.43 | $16.47 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | (.02) | .05 | (.10) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.65 | 1.27 | 3.06 | |||||||||||
Total from Investment Operations | 3.63 | 1.32 | 2.96 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.02) | – | – | |||||||||||
Distributions (from capital gains)* | (.61) | – | – | |||||||||||
Total Distributions and Other | (.63) | – | – | |||||||||||
Net Asset Value, End of Period | $23.75 | $20.75 | $19.43 | |||||||||||
Total Return** | 17.49% | 6.79% | 17.97% | |||||||||||
Net Assets, End of Period (in thousands) | $29,872 | $26,768 | $6,196 | |||||||||||
Average Net Assets for the Period (in thousands) | $28,207 | $16,540 | $3,739 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 2.00% | 1.96% | 1.95% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 2.00% | 1.96% | 1.95% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | (0.21)% | (0.69)% | (0.39)% | |||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% |
Class C Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income/(loss) | .08 | |||||
Net gain on investments (both realized and unrealized) | .81 | |||||
Total from Investment Operations | .89 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.07) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.11) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 8.96% | |||||
Net Assets, End of Period (in thousands) | $3,678 | |||||
Average Net Assets for the Period (in thousands) | $3,475 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.81% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.81% | |||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 1.72% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 67
Table of Contents
Financial Highlights (continued)
Class D Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited) and the fiscal | Perkins Large Cap Value Fund | |||||||||
period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $11.58 | $12.15 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .07 | .02 | ||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.26 | (.59) | ||||||||
Total from Investment Operations | 2.33 | (.57) | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.14) | – | ||||||||
Distributions (from capital gains)* | (.32) | – | ||||||||
Total Distributions and Other | (.46) | – | ||||||||
Net Asset Value, End of Period | $13.45 | $11.58 | ||||||||
Total Return** | 20.16% | (4.69)% | ||||||||
Net Assets, End of Period (in thousands) | $4,804 | $2,437 | ||||||||
Average Net Assets for the Period (in thousands) | $3,180 | $1,548 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 1.09% | 1.16% | ||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 1.09% | 1.16% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.41% | 0.70% | ||||||||
Portfolio Turnover Rate*** | 44% | 35% |
Class D Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited) and the fiscal | Perkins Mid Cap Value Fund | |||||||||
period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $19.06 | $19.52 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .16 | .04 | ||||||||
Net gain/(loss) on investments (both realized and unrealized) | 3.53 | (.50) | ||||||||
Total from Investment Operations | 3.69 | (.46) | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.18) | – | ||||||||
Distributions (from capital gains)* | – | – | ||||||||
Total Distributions and Other | (.18) | – | ||||||||
Net Asset Value, End of Period | $22.57 | $19.06 | ||||||||
Total Return** | 19.37% | (2.36)% | ||||||||
Net Assets, End of Period (in thousands) | $918,579 | $796,330 | ||||||||
Average Net Assets for the Period (in thousands) | $848,202 | $868,198 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.93% | 0.93% | ||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.93% | 0.93% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.49% | 0.49% | ||||||||
Portfolio Turnover Rate*** | 72% | 66% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
68 | DECEMBER 31, 2010
Table of Contents
Class D Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited) and the fiscal | Perkins Small Cap Value Fund | |||||||||
period ended June 30, 2010 | 2010 | 2010(1) | ||||||||
Net Asset Value, Beginning of Period | $20.92 | $20.79 | ||||||||
Income from Investment Operations: | ||||||||||
Net investment income | .09 | .07 | ||||||||
Net gain on investments (both realized and unrealized) | 3.68 | .06 | ||||||||
Total from Investment Operations | 3.77 | .13 | ||||||||
Less Distributions and Other: | ||||||||||
Dividends (from net investment income)* | (.09) | – | ||||||||
Distributions (from capital gains)* | (.61) | – | ||||||||
Total Distributions and Other | (.70) | – | ||||||||
Net Asset Value, End of Period | $23.99 | $20.92 | ||||||||
Total Return** | 18.05% | 0.63% | ||||||||
Net Assets, End of Period (in thousands) | $85,953 | $78,237 | ||||||||
Average Net Assets for the Period (in thousands) | $80,572 | $74,758 | ||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 1.01% | 0.98% | ||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 1.01% | 0.98% | ||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.78% | 0.12% | ||||||||
Portfolio Turnover Rate*** | 59% | 59% |
Class D Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(3) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | .11 | |||||
Net gain on investments (both realized and unrealized) | .82 | |||||
Total from Investment Operations | .93 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.11) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.15) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 9.34% | |||||
Net Assets, End of Period (in thousands) | $7,126 | |||||
Average Net Assets for the Period (in thousands) | $4,661 | |||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.99% | |||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.99% | |||||
Ratio of Net Investment Income to Average Net Assets*** | 2.56% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from February 16, 2010 (inception date) through June 30, 2010. Please see Note 9 regarding the Restructuring of former Class J Shares. | |
(2) | See Note 6 in Notes to Financial Statements. | |
(3) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 69
Table of Contents
Financial Highlights (continued)
Class I Shares
For a share outstanding during the six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eleven-month fiscal period ended June 30, 2010 and the fiscal period | Perkins Large Cap Value Fund | |||||||||||||
ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $11.58 | $11.14 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .10 | .07 | .04 | |||||||||||
Net gain on investments (both realized and unrealized) | 2.23 | .43 | 1.13 | |||||||||||
Total from Investment Operations | 2.33 | .50 | 1.17 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.13) | (.04) | (.03) | |||||||||||
Distributions (from capital gains)* | (.32) | (.02) | – | |||||||||||
Total Distributions and Other | (.45) | (.06) | (.03) | |||||||||||
Net Asset Value, End of Period | $13.46 | $11.58 | $11.14 | |||||||||||
Total Return** | 20.23% | 4.49% | 11.76% | |||||||||||
Net Assets, End of Period (in thousands) | $91,932 | $69,225 | $28,863 | |||||||||||
Average Net Assets for the Period (in thousands) | $77,520 | $53,625 | $17,284 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.96% | 1.04% | 1.00% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.96% | 1.03% | 1.00% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.63% | 0.76% | 1.36% | |||||||||||
Portfolio Turnover Rate*** | 44% | 35% | 57% |
Class I Shares
For a share outstanding during the six-month period ended December 31, 2010 | ||||||||||||||
(unaudited), the eight-month fiscal period ended June 30, 2010 and the fiscal period | Perkins Mid Cap Value Fund | |||||||||||||
ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | |||||||||||
Net Asset Value, Beginning of Period | $19.07 | $18.68 | $16.07 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .15 | .08 | .01 | |||||||||||
Net gain on investments (both realized and unrealized) | 3.55 | .37 | 2.60 | |||||||||||
Total from Investment Operations | 3.70 | .45 | 2.61 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.20) | (.06) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.20) | (.06) | – | |||||||||||
Net Asset Value, End of Period | $22.57 | $19.07 | $18.68 | |||||||||||
Total Return** | 19.42% | 2.40% | 16.24% | |||||||||||
Net Assets, End of Period (in thousands) | $2,908,085 | $2,223,203 | $1,258,548 | |||||||||||
Average Net Assets for the Period (in thousands) | $2,573,523 | $1,712,121 | $1,058,484 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.86% | 0.83% | 0.81% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.86% | 0.83% | 0.81% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.53% | 0.63% | 0.75% | |||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. |
See Notes to Financial Statements.
70 | DECEMBER 31, 2010
Table of Contents
Class I Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), | Perkins Small Cap Value Fund | |||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $20.97 | $19.49 | $16.47 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .04 | .11 | (.02) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.76 | 1.37 | 3.04 | |||||||||||
Total from Investment Operations | 3.80 | 1.48 | 3.02 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.12) | – | – | |||||||||||
Distributions (from capital gains)* | (.61) | – | – | |||||||||||
Total Distributions and Other | (.73) | – | – | |||||||||||
Net Asset Value, End of Period | $24.04 | $20.97 | $19.49 | |||||||||||
Total Return** | 18.13% | 7.59% | 18.34% | |||||||||||
Net Assets, End of Period (in thousands) | $1,257,133 | $532,188 | $236,437 | |||||||||||
Average Net Assets for the Period (in thousands) | $889,510 | $408,417 | $42,710 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.90% | 0.85% | 0.77% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.90% | 0.85% | 0.75% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.87% | 0.52% | 0.80% | |||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% |
Class I Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income/(loss) | .11 | |||||
Net gain on investments (both realized and unrealized) | .82 | |||||
Total from Investment Operations | .93 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.11) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.15) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 9.36% | |||||
Net Assets, End of Period (in thousands) | $5,521 | |||||
Average Net Assets for the Period (in thousands) | $4,643 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 0.89% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 0.89% | |||||
Ratio of Net Investment Income to Average Net Assets*** | 2.66% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 71
Table of Contents
Financial Highlights (continued)
Class L Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the eight- | ||||||||||||||||||||||||||||||
month fiscal period ended June 30, 2010 and each | Perkins Mid Cap Value Fund | |||||||||||||||||||||||||||||
fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.18 | $18.79 | $16.75 | $26.69 | $24.99 | $23.34 | $22.31 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .32 | 1.72 | .23 | .49 | .39 | .39 | .15 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 3.42 | (1.28) | 2.93 | (7.31) | 3.28 | 3.37 | 2.92 | |||||||||||||||||||||||
Total from Investment Operations | 3.74 | .44 | 3.16 | (6.82) | 3.67 | 3.76 | 3.07 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.19) | (.05) | (.33) | (.39) | (.35) | (.28) | (.11) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | (.79) | (2.73) | (1.62) | (1.83) | (1.93) | |||||||||||||||||||||||
Total Distributions and Other | (.19) | (.05) | (1.12) | (3.12) | (1.97) | (2.11) | (2.04) | |||||||||||||||||||||||
Net Asset Value, End of Period | $22.73 | $19.18 | $18.79 | $16.75 | $26.69 | $24.99 | $23.34 | |||||||||||||||||||||||
Total Return** | 19.50% | 2.36% | 20.67% | (28.49)% | 15.49% | 17.08% | 14.40% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $68,831 | $61,880 | $350,003 | $365,505 | $885,293 | $1,068,045 | $734,926 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $64,840 | $347,623 | $298,741 | $759,342 | $1,043,566 | $921,447 | $597,747 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.77% | 0.76% | 0.87% | 0.84% | 0.77% | 0.78% | 0.77% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.77% | 0.76% | 0.87% | 0.84% | 0.77% | 0.77% | 0.77% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.73% | 0.85% | 1.11% | 1.76% | 1.60% | 1.79% | 0.82% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% | 103% | 95% | 95% | 86% |
Class L Shares
For a share outstanding during the six-month period | ||||||||||||||||||||||||||||||
ended December 31, 2010 (unaudited), the eight- | ||||||||||||||||||||||||||||||
month fiscal period ended June 30, 2010 and each | Perkins Small Cap Value Fund | |||||||||||||||||||||||||||||
fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $21.21 | $19.72 | $18.24 | $28.20 | $30.54 | $31.38 | $33.19 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .50 | .18 | .09 | .33 | .38 | .54 | .37 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 3.35 | 1.31 | 3.45 | (5.86) | 2.61 | 3.43 | 3.17 | |||||||||||||||||||||||
Total from Investment Operations | 3.85 | 1.49 | 3.54 | (5.53) | 2.99 | 3.97 | 3.54 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.11) | – | (.38) | (.35) | (.50) | (.36) | (.39) | |||||||||||||||||||||||
Distributions (from capital gains)* | (.61) | – | (1.62) | (4.08) | (4.83) | (4.45) | (4.96) | |||||||||||||||||||||||
Return of capital | N/A | N/A | (.06) | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Total Distributions and Other | (.72) | – | (2.06) | (4.43) | (5.33) | (4.81) | (5.35) | |||||||||||||||||||||||
Net Asset Value, End of Period | $24.34 | $21.21 | $19.72 | $18.24 | $28.20 | $30.54 | $31.38 | |||||||||||||||||||||||
Total Return** | 18.17% | 7.56% | 23.12% | (22.39)% | 11.06% | 13.93% | 11.57% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $319,953 | $657,562 | $706,873 | $563,464 | $771,789 | $923,755 | $1,185,733 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $503,256 | $706,615 | $613,826 | $664,935 | $831,092 | $1,092,751 | $1,323,226 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 0.84% | 0.83% | 0.85% | 0.82% | 0.80% | 0.80% | 0.79% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 0.84% | 0.83% | 0.85% | 0.81% | 0.79% | 0.79% | 0.79% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.98% | 0.70% | 1.28% | 1.65% | 1.34% | 1.51% | 1.05% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% | 112% | 59% | 62% | 44% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
72 | DECEMBER 31, 2010
Table of Contents
Class R Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Mid Cap Value Fund | |||||||||||||
eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $19.00 | $18.64 | $16.07 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .09 | – | (.03) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.52 | .36 | 2.60 | |||||||||||
Total from Investment Operations | 3.61 | .36 | 2.57 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.09) | – | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.09) | – | – | |||||||||||
Net Asset Value, End of Period | $22.52 | $19.00 | $18.64 | |||||||||||
Total Return** | 18.99% | 1.93% | 15.99% | |||||||||||
Net Assets, End of Period (in thousands) | $150,684 | $103,961 | $71,203 | |||||||||||
Average Net Assets for the Period (in thousands) | $127,560 | $94,163 | $64,070 | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.53% | 1.52% | 1.53% | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.53% | 1.52% | 1.53% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.85% | (0.04)% | 0.03% | |||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% |
Class R Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Small Cap Value Fund | |||||||||||||
eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $20.83 | $19.46 | $16.47 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .03 | .11 | (.12) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.65 | 1.26 | 3.11 | |||||||||||
Total from Investment Operations | 3.68 | 1.37 | 2.99 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.08) | – | – | |||||||||||
Distributions (from capital gains)* | (.61) | – | – | |||||||||||
Total Distributions and Other | (.69) | – | – | |||||||||||
Net Asset Value, End of Period | $23.82 | $20.83 | $19.46 | |||||||||||
Total Return** | 17.70% | 7.04% | 18.15% | |||||||||||
Net Assets, End of Period (in thousands) | $28,659 | $21,450 | $3,734 | |||||||||||
Average Net Assets for the Period (in thousands) | $28,345 | $8,368 | $3,362 | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.60% | 1.57% | 1.54% | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.60% | 1.57% | 1.54% | |||||||||||
Ratio of Net Investment Income/(Loss) to Average Net Assets*** | 0.17% | (0.28)% | 0.10% | |||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. |
See Notes to Financial Statements.
Janus Value Funds | 73
Table of Contents
Financial Highlights (continued)
Class S Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), | Perkins Large Cap Value Fund | |||||||||||||
the eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $11.56 | $11.13 | $10.00 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .07 | .03 | .04 | |||||||||||
Net gain on investments (both realized and unrealized) | 2.23 | .42 | 1.10 | |||||||||||
Total from Investment Operations | 2.30 | .45 | 1.14 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.07) | – | (.01) | |||||||||||
Distributions (from capital gains)* | (.32) | (.02) | – | |||||||||||
Total Distributions and Other | (.39) | (.02) | (.01) | |||||||||||
Net Asset Value, End of Period | $13.47 | $11.56 | $11.13 | |||||||||||
Total Return** | 19.96% | 4.07% | 11.40% | |||||||||||
Net Assets, End of Period (in thousands) | $695 | $580 | $557 | |||||||||||
Average Net Assets for the Period (in thousands) | $636 | $616 | $484 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.45% | 1.53% | 1.48% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.45% | 1.53% | 1.47% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.17% | 0.28% | 0.98% | |||||||||||
Portfolio Turnover Rate*** | 44% | 35% | 57% |
Class S Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), | Perkins Mid Cap Value Fund | |||||||||||||
the eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(4) | 2009(5) | |||||||||||
Net Asset Value, Beginning of Period | $19.03 | $18.66 | $16.07 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .11 | .03 | (.02) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.53 | .36 | 2.61 | |||||||||||
Total from Investment Operations | 3.64 | .39 | 2.59 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.12) | (.02) | – | |||||||||||
Distributions (from capital gains)* | – | – | – | |||||||||||
Total Distributions and Other | (.12) | (.02) | – | |||||||||||
Net Asset Value, End of Period | $22.55 | $19.03 | $18.66 | |||||||||||
Total Return** | 19.15% | 2.09% | 16.12% | |||||||||||
Net Assets, End of Period (in thousands) | $771,350 | $569,777 | $434,615 | |||||||||||
Average Net Assets for the Period (in thousands) | $668,676 | $559,518 | $397,613 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.28% | 1.27% | 1.28% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.28% | 1.27% | 1.28% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.11% | 0.22% | 0.28% | |||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. |
See Notes to Financial Statements.
74 | DECEMBER 31, 2010
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Class S Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Small Cap Value Fund | |||||||||||||
eight-month fiscal period ended June 30, 2010 and the fiscal period ended October 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $20.88 | $19.47 | $16.47 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income/(loss) | .04 | .11 | (.10) | |||||||||||
Net gain on investments (both realized and unrealized) | 3.69 | 1.30 | 3.10 | |||||||||||
Total from Investment Operations | 3.73 | 1.41 | 3.00 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.08) | – | – | |||||||||||
Distributions (from capital gains)* | (.61) | – | – | |||||||||||
Total Distributions and Other | (.69) | – | – | |||||||||||
Net Asset Value, End of Period | $23.92 | $20.88 | $19.47 | |||||||||||
Total Return** | 17.86% | 7.24% | 18.21% | |||||||||||
Net Assets, End of Period (in thousands) | $87,409 | $51,460 | $26,401 | |||||||||||
Average Net Assets for the Period (in thousands) | $66,369 | $44,047 | $24,792 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.35% | 1.32% | 1.21% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.35% | 1.32% | 1.20% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.44% | 0.07% | 0.46% | |||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% |
Class S Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(4) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income/(loss) | .10 | |||||
Net gain on investments (both realized and unrealized) | .81 | |||||
Total from Investment Operations | .91 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.09) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.13) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 9.17% | |||||
Net Assets, End of Period (in thousands) | $3,639 | |||||
Average Net Assets for the Period (in thousands) | $3,467 | |||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.32% | |||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.32% | |||||
Ratio of Net Investment Income to Average Net Assets*** | 2.21% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 75
Table of Contents
Financial Highlights (continued)
Class T Shares
For a share outstanding during the six-month period ended December 31, 2010 (unaudited), the | Perkins Large Cap Value Fund | |||||||||||||
eleven-month fiscal period ended June 30, 2010 and the fiscal period ended July 31, 2009 | 2010 | 2010(1) | 2009(2) | |||||||||||
Net Asset Value, Beginning of Period | $11.56 | $11.13 | $10.22 | |||||||||||
Income from Investment Operations: | ||||||||||||||
Net investment income | .08 | .04 | – | |||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 2.24 | .44 | .91 | |||||||||||
Total from Investment Operations | 2.32 | .48 | .91 | |||||||||||
Less Distributions and Other: | ||||||||||||||
Dividends (from net investment income)* | (.13) | (.03) | – | |||||||||||
Distributions (from capital gains)* | (.32) | (.02) | – | |||||||||||
Total Distributions and Other | (.45) | (.05) | – | |||||||||||
Net Asset Value, End of Period | $13.43 | $11.56 | $11.13 | |||||||||||
Total Return** | 20.11% | 4.32% | 8.90% | |||||||||||
Net Assets, End of Period (in thousands) | $1,362 | $594 | $1 | |||||||||||
Average Net Assets for the Period (in thousands) | $845 | $142 | $1 | |||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.19% | 1.29% | 1.26% | |||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.19% | 1.29% | 1.25% | |||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.30% | 0.53% | 1.39% | |||||||||||
Portfolio Turnover Rate*** | 44% | 35% | 57% |
Class T Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), | ||||||||||||||||||||||||||||||
the eight-month fiscal period ended June 30, | Perkins Mid Cap Value Fund | |||||||||||||||||||||||||||||
2010 and each fiscal year ended October 31 | 2010 | 2010(4) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $19.06 | $18.67 | $16.63 | $26.56 | $24.87 | $23.24 | $22.22 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .15 | .06 | .11 | .29 | .32 | .37 | .14 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 3.52 | .37 | 2.97 | (7.09) | 3.30 | 3.33 | 2.89 | |||||||||||||||||||||||
Total from Investment Operations | 3.67 | .43 | 3.08 | (6.80) | 3.62 | 3.70 | 3.03 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.16) | (.04) | (.25) | (.40) | (.31) | (.24) | (.08) | |||||||||||||||||||||||
Distributions (from capital gains)* | – | – | (.79) | (2.73) | (1.62) | (1.83) | (1.93) | |||||||||||||||||||||||
Total Distributions and Other | (.16) | (.04) | (1.04) | (3.13) | (1.93) | (2.07) | (2.01) | |||||||||||||||||||||||
Net Asset Value, End of Period | $22.57 | $19.06 | $18.67 | $16.63 | $26.56 | $24.87 | $23.24 | |||||||||||||||||||||||
Total Return** | 19.27% | 2.27% | 20.27% | (28.59)% | 15.38% | 16.88% | 14.26% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $7,712,033 | $6,830,168 | $7,321,160 | $5,170,228 | $5,892,209 | $5,181,449 | $4,188,183 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $7,243,303 | $7,518,444 | $5,907,999 | $6,009,064 | $5,710,028 | $4,806,698 | $3,797,215 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(3) | 1.03% | 1.03% | 1.11% | 1.07% | 0.86% | 0.93% | 0.93% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(3) | 1.03% | 1.03% | 1.11% | 1.06% | 0.85% | 0.93% | 0.92% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 1.40% | 0.49% | 0.84% | 1.47% | 1.49% | 1.69% | 0.67% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 72% | 66% | 88% | 103% | 95% | 95% | 86% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from July 6, 2009 (inception date) through July 31, 2009. | |
(3) | See Note 6 in Notes to Financial Statements. | |
(4) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. |
See Notes to Financial Statements.
76 | DECEMBER 31, 2010
Table of Contents
Class T Shares
For a share outstanding during the six-month | ||||||||||||||||||||||||||||||
period ended December 31, 2010 (unaudited), the | ||||||||||||||||||||||||||||||
eight-month fiscal period ended June 30, 2010 | Perkins Small Cap Value Fund | |||||||||||||||||||||||||||||
and each fiscal year ended October 31 | 2010 | 2010(1) | 2009 | 2008 | 2007 | 2006 | 2005 | |||||||||||||||||||||||
Net Asset Value, Beginning of Period | $20.92 | $19.47 | $17.98 | $27.90 | $30.29 | $31.16 | $32.98 | |||||||||||||||||||||||
Income from Investment Operations: | ||||||||||||||||||||||||||||||
Net investment income | .07 | .12 | .08 | .32 | .32 | .39 | .29 | |||||||||||||||||||||||
Net gain/(loss) on investments (both realized and unrealized) | 3.69 | 1.33 | 3.39 | (5.83) | 2.57 | 3.49 | 3.16 | |||||||||||||||||||||||
Total from Investment Operations | 3.76 | 1.45 | 3.47 | (5.51) | 2.89 | 3.88 | 3.45 | |||||||||||||||||||||||
Less Distributions and Other: | ||||||||||||||||||||||||||||||
Dividends (from net investment income)* | (.09) | – | (.31) | (.33) | (.45) | (.30) | (.31) | |||||||||||||||||||||||
Distributions (from capital gains)* | (.61) | – | (1.62) | (4.08) | (4.83) | (4.45) | (4.96) | |||||||||||||||||||||||
Return of capital | N/A | N/A | (.05) | N/A | N/A | N/A | N/A | |||||||||||||||||||||||
Total Distributions and Other | (.70) | – | (1.98) | (4.41) | (5.28) | (4.75) | (5.27) | |||||||||||||||||||||||
Net Asset Value, End of Period | $23.98 | $20.92 | $19.47 | $17.98 | $27.90 | $30.29 | $31.16 | |||||||||||||||||||||||
Total Return** | 17.98% | 7.45% | 22.87% | (22.57)% | 10.77% | 13.71% | 11.34% | |||||||||||||||||||||||
Net Assets, End of Period (in thousands) | $1,290,698 | $1,010,405 | $659,087 | $503,335 | $813,857 | $1,153,144 | $1,338,093 | |||||||||||||||||||||||
Average Net Assets for the Period (in thousands) | $1,122,652 | $936,037 | $441,820 | $662,033 | $974,404 | $1,259,565 | $1,440,206 | |||||||||||||||||||||||
Ratio of Gross Expenses to Average Net Assets***(2) | 1.10% | 1.08% | 1.11% | 1.03% | 1.01% | 1.01% | 1.00% | |||||||||||||||||||||||
Ratio of Net Expenses to Average Net Assets***(2) | 1.10% | 1.08% | 1.11% | 1.03% | 1.00% | 1.00% | 0.99% | |||||||||||||||||||||||
Ratio of Net Investment Income to Average Net Assets*** | 0.69% | 0.35% | 1.06% | 1.44% | 1.13% | 1.26% | 0.84% | |||||||||||||||||||||||
Portfolio Turnover Rate*** | 59% | 59% | 85% | 112% | 59% | 62% | 44% |
Class T Shares
Perkins Value Plus | ||||||
Income Fund | ||||||
For a share outstanding during the period ended December 31, 2010 (unaudited) | 2010(3) | |||||
Net Asset Value, Beginning of Period | $10.00 | |||||
Income from Investment Operations: | ||||||
Net investment income | .11 | |||||
Net gain/(loss) on investments (both realized and unrealized) | .81 | |||||
Total from Investment Operations | .92 | |||||
Less Distributions and Other: | ||||||
Dividends (from net investment income)* | (.10) | |||||
Distributions (from capital gains)* | (.04) | |||||
Total Distributions and Other | (.14) | |||||
Net Asset Value, End of Period | $10.78 | |||||
Total Return** | 9.28% | |||||
Net Assets, End of Period (in thousands) | $3,897 | |||||
Average Net Assets for the Period (in thousands) | $3,514 | |||||
Ratio of Gross Expenses to Average Net Assets***(2) | 1.07% | |||||
Ratio of Net Expenses to Average Net Assets***(2) | 1.07% | |||||
Ratio of Net Investment Income to Average Net Assets*** | 2.45% | |||||
Portfolio Turnover Rate*** | 91% |
* | See Note 5 in Notes to Financial Statements. | |
** | Total return not annualized for periods of less than one full year. | |
*** | Annualized for periods of less than one full year. | |
(1) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(2) | See Note 6 in Notes to Financial Statements. | |
(3) | Period from July 30, 2010 (inception date) through December 31, 2010. |
See Notes to Financial Statements.
Janus Value Funds | 77
Table of Contents
Notes to Schedules of Investments (unaudited)
Barclays Capital U.S. Aggregate Bond Index | An unmanaged market value weighted index for U.S. dollar-denominated investment-grade debt issues, including government, corporate, mortgage-backed, and asset-backed securities with maturities of at least one year. | |
Lipper Large-Cap Value Funds | Funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) above Lipper’s USDE large-cap floor. Large-cap value funds typically have a below average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P 500® Index. | |
Lipper Mid-Cap Value Funds | Funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) less than 300% of the dollar-weighted median market capitalization of the middle 1,000 securities of the S&P SuperComposite 1500 Index. Mid-cap value funds typically have a below-average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P MidCap 400 Index. | |
Lipper Mixed-Asset Target Allocation Moderate Funds | Funds that, by portfolio practice, maintain a mix of between 40%-60% equity securities, with the remainder invested in bonds, cash, and cash equivalents. | |
Lipper Small-Cap Core Funds | Funds that, by portfolio practice, invest at least 75% of their equity assets in companies with market capitalizations (on a three-year weighted basis) less than 250% of the dollar-weighted median of the smallest 500 of the middle 1,000 securities of the S&P SuperComposite 1500 Index. Small-cap core funds have more latitude in the companies in which they invest. These funds typically have an average price-to-earnings ratio, price-to-book ratio, and three-year sales-per-share growth value, compared to the S&P SmallCap 600 Index. | |
Russell 1000® Value Index | Measures the performance of those Russell 1000® Index companies with lower price-to-book ratios and lower forecasted growth values. | |
Russell 2000® Index | Measures the performance of the 2,000 smallest companies in the Russell 3000® Index. | |
Russell 2000® Value Index | Measures the performance of those Russell 2000® Index companies with lower price-to-book ratios and lower forecasted growth values. | |
Russell Midcap® Value Index | Measures the performance of those Russell Midcap® Index companies with lower price-to-book ratios and lower forecasted growth values. | |
S&P 500® Index | The Standard & Poor’s (“S&P”) 500® Index is a commonly recognized, market-capitalization weighted index of 500 widely held equity securities, designed to measure broad U.S. Equity performance. | |
Value Income Index | Value Income Index is a hypothetical internally-calculated index which combines the total returns from the Russell 1000® Value Index (50%) and the Barclays Capital U.S. Aggregate Bond Index (50%). | |
ADR | American Depositary Receipt | |
PLC | Public Limited Company | |
REIT | Real Estate Investment Trust | |
ULC | Unlimited Liability Company | |
U.S. Shares | Securities of foreign companies trading on an American Stock Exchange. |
(a) | All or a portion of this position has not settled, or is not funded. Upon settlement or funding date, interest rates for unsettled or unfunded amounts will be determined. Interest and dividends will not be accrued until time of settlement or funding. | |
* | Non-income producing security. | |
** | A portion of this security has been segregated by the custodian to cover margin or segregation requirements on open futures contracts, forward currency contracts, options contracts, short sales, swap agreements, and/or securities with extended settlement dates. | |
‡ | Rate is subject to change. Rate shown reflects current rate. | |
ÇÇ | Security is a U.S. Treasury Inflation-Protected Security (TIPS). |
78 | DECEMBER 31, 2010
Table of Contents
144A | Securities sold under Rule 144A of the Securities Act of 1933, as amended, are subject to legal and/or contractual restrictions on resale and may not be publicly sold without registration under the 1933 Act. These securities have been determined to be liquid under guidelines established by the Board of Trustees. The total value of 144A securities as of the period ended December 31, 2010 is indicated in the table below: |
Value as a % | ||||||||||
Fund | Value | of Net Assets | ||||||||
Perkins Value Plus Income Fund | $ | 1,272,276 | 4.6 | % | ||||||
£ | The Investment Company Act of 1940, as amended, defines affiliates as those companies in which a fund holds 5% or more of the outstanding voting securities at any time during the period ended December 31, 2010. |
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Perkins Mid Cap Value Fund | |||||||||||||||||||||
Aaron Rents, Inc. | 600,000 | $ | 10,757,692 | 700,000 | $ | 13,150,184 | $ | 634,157 | $ | 85,297 | $ | 61,170,000 | |||||||||
Charles River Laboratories International, Inc.* | 900,000 | 28,251,081 | 100,000 | 2,844,712 | 661,181 | – | 103,066,000 | ||||||||||||||
Comstock Resources, Inc.* | 700,000 | 17,606,896 | 500,000 | 17,100,166 | (5,185,047) | – | 61,400,000 | ||||||||||||||
Intersil Corp. – Class A | 400,000 | 4,482,914 | 2,700,000 | 39,047,963 | (2,565,787) | 1,644,000 | 73,296,000 | ||||||||||||||
Potlatch Corp. | 150,000 | 5,034,082 | 416,800 | 15,723,509 | (1,207,846) | 2,040,306 | 65,109,765 | ||||||||||||||
Semtech Corp.* | 400,000 | 6,926,524 | 1,500,000 | 25,620,118 | 9,253,880 | – | 49,808,000 | ||||||||||||||
Skechers U.S.A., Inc. – Class A* | 1,900,795 | 38,752,701 | – | – | – | – | 38,015,900 | ||||||||||||||
SRA International, Inc.* | – | – | – | – | – | – | 53,170,000 | ||||||||||||||
Tech Data Corp.* | 250,000 | 9,714,325 | – | – | – | – | 112,251,000 | ||||||||||||||
URS Corp.* | 850,000 | 32,197,818 | – | – | – | – | 176,842,500 | ||||||||||||||
Washington Federal, Inc. | – | – | – | – | – | 928,000 | 98,136,000 | ||||||||||||||
$ | 153,724,033 | $ | 113,486,652 | $ | 1,590,538 | $ | 4,697,603 | $ | 892,265,165 | ||||||||||||
Purchases | Sales | Realized | Dividend | Value | |||||||||||||||||
Shares | Cost | Shares | Cost | Gain/(Loss) | Income | at 12/31/10 | |||||||||||||||
Perkins Small Cap Value Fund | |||||||||||||||||||||
Angiodynamics, Inc.* | 450,000 | $ | 6,429,535 | 100,000 | $ | 1,616,729 | $ | (29,630) | $ | – | $ | 19,981,000 | |||||||||
CRA International, Inc.* | – | – | 150,000 | 3,576,041 | (501,731) | – | 11,755,000 | ||||||||||||||
Dycom Industries, Inc.* | 300,000 | 2,792,862 | 400,000 | 4,109,151 | 859,375 | – | 26,550,000 | ||||||||||||||
Genoptix, Inc.* | – | – | 950,000 | 29,184,520 | (11,607,476) | – | 4,755,000 | ||||||||||||||
Glatfelter | 651,538 | 7,709,209 | – | – | – | 352,800 | 30,816,571 | ||||||||||||||
Government Properties Income Trust | 416,358 | 10,703,905 | – | – | – | 1,387,293 | 53,580,000 | ||||||||||||||
Movado Group, Inc.* | – | – | 350,000 | 4,116,867 | 1,476,098 | – | 12,105,000 | ||||||||||||||
Navigators Group (The), Inc.* | – | – | 275,000 | 13,069,163 | 490,897 | – | 45,315,000 | ||||||||||||||
Omnicell, Inc.* | 250,000 | 3,248,706 | 150,000 | 1,967,188 | 29,953 | – | 26,010,000 | ||||||||||||||
Sterling Construction Co., Inc.* | 200,000 | 2,406,007 | – | – | – | – | 14,344,000 | ||||||||||||||
Titan Machinery, Inc. | – | – | 900,000 | 12,077,979 | 5,456,131 | – | – | ||||||||||||||
Vital Images, Inc.* | 72,197 | 926,323 | – | – | – | – | 12,193,314 | ||||||||||||||
$ | 34,216,547 | $ | 69,717,638 | $ | (3,826,383) | $ | 1,740,093 | $ | 257,404,885 | ||||||||||||
The following is a summary of the inputs that were used to value the Funds’ investments in securities and other financial instruments as of December 31, 2010. See Notes to Financial Statements for more information.
Valuation Inputs Summary (as of December 31, 2010)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Perkins Large Cap Value Fund | |||||||||||
Common Stock | |||||||||||
Cellular Telecommunications | $ | – | $ | 1,704,735 | $ | – | |||||
Food – Miscellaneous/Diversified | 1,860,630 | 1,065,360 | – | ||||||||
Medical – Drugs | 3,205,439 | 972,675 | – | ||||||||
All Other | 85,204,432 | – | – | ||||||||
Repurchase Agreement | – | 9,944,000 | – | ||||||||
Total Investments in Securities | $ | 90,270,501 | $ | 13,686,770 | $ | – | |||||
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Notes to Schedules of Investments (unaudited) (continued)
Level 2 – Other Significant | Level 3 – Significant | ||||||||||
Level 1 – Quoted Prices | Observable Inputs | Unobservable Inputs | |||||||||
Investments in Securities: | |||||||||||
Perkins Mid Cap Value Fund | |||||||||||
Common Stock | |||||||||||
Cellular Telecommunications | $ | – | $ | 116,304,819 | $ | – | |||||
Food – Miscellaneous/Diversified | 221,481,448 | 111,168,000 | – | ||||||||
Medical – Drugs | 86,346,000 | 94,320,000 | – | ||||||||
All Other | 12,140,268,374 | – | – | ||||||||
Repurchase Agreements | – | 1,214,591,000 | – | ||||||||
Total Investments in Securities | $ | 12,448,095,822 | $ | 1,536,383,819 | $ | – | |||||
Investments in Securities: | |||||||||||
Perkins Small Cap Value Fund | |||||||||||
Common Stock | $ | 2,725,074,014 | $ | – | $ | – | |||||
Repurchase Agreements | – | 581,803,000 | – | ||||||||
Total Investments in Securities | $ | 2,725,074,014 | $ | 581,803,000 | $ | – | |||||
Investments in Securities: | |||||||||||
Perkins Value Plus Income Fund | |||||||||||
Bank Loans | $ | – | $ | 309,097 | $ | – | |||||
Common Stock | |||||||||||
Cellular Telecommunications | – | 358,965 | – | ||||||||
Food – Miscellaneous/Diversified | 495,044 | 154,400 | – | ||||||||
Medical – Drugs | 577,483 | 319,300 | – | ||||||||
All Other | 13,200,367 | – | – | ||||||||
Corporate Bonds | – | 8,175,254 | – | ||||||||
Preferred Stock | – | 14,128 | – | ||||||||
U.S. Treasury Notes/Bonds | – | 2,025,326 | – | ||||||||
Short-Term Taxable Variable Rate Demand Note | – | 25,928 | – | ||||||||
Money Market | – | 2,145,837 | – | ||||||||
Total Investments in Securities | $ | 14,272,894 | $ | 13,528,235 | $ | – | |||||
Investments in Purchased Options: | |||||||||||
Perkins Mid Cap Value Fund | $ | – | $ | 27,756,508 | $ | – | |||||
Other Financial Instruments(a): | |||||||||||
Perkins Mid Cap Value Fund | $ | – | $ | (5,819,585) | $ | – | |||||
Perkins Value Plus Income Fund | – | (388) | – | ||||||||
(a) | Other financial instruments include futures, forward currency, written option, and swap contracts. Forward currency contracts and swap contracts are reported at their unrealized appreciation/(depreciation) at measurement date, which represents the change in the contract’s value from trade date. Futures are reported at their variation margin at measurement date, which represents the amount due to/from the Fund at that date. Options are reported at their market value at measurement date. |
Aggregate collateral segregated to cover margin or segregation requirements on open futures contracts, forward currency contracts, options contracts, short sales, swap agreements, and/or securities with extended settlement dates as of December 31, 2010 is noted below.
Fund | Aggregate Value | ||||
Perkins Mid Cap Value Fund | $ | 13,878,598 | |||
Perkins Value Plus Income Fund | 276,119 | ||||
Repurchase agreements held by a Fund are fully collateralized, and such collateral is in the possession of the Fund’s custodian or, for tri-party agreements, the custodian designated by the agreement. The collateral is evaluated daily to ensure its market value exceeds the current market value of the repurchase agreements, including accrued interest. In the event of default on the obligation to repurchase, the Fund has the right to liquidate the collateral and apply the proceeds in satisfaction of the obligation. In the event of default or bankruptcy by the other party to the agreement, realization and/or retention of the collateral or proceeds may be subject to legal proceedings.
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Notes to Financial Statements (unaudited)
The following section describes the organization and significant accounting policies and provides more detailed information about the schedules and tables that appear throughout this report. In addition, the Notes to Financial Statements explain the methods used in preparing and presenting this report.
1. | Organization and Significant Accounting Policies |
Perkins Large Cap Value Fund, Perkins Mid Cap Value Fund, Perkins Small Cap Value Fund and Perkins Value Plus Income Fund (individually, a “Fund” and collectively, the “Funds”) are series funds. The Funds are part of Janus Investment Fund (the “Trust”), which is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company. The financial statements include information for the period from July 30, 2010 (inception date) through December 31, 2010 for Perkins Value Plus Income Fund and for the six-month period ended December 31, 2010 for Perkins Large Cap Value Fund, Perkins Mid Cap Value Fund, and Perkins Small Cap Value Fund. The Trust offers forty funds which include multiple series of shares, with differing investment objectives and policies. The Funds invest primarily in equity securities. Each Fund in this report is classified as diversified, as defined in the 1940 Act.
Each Fund in this report offers multiple classes of shares in order to meet the needs of various types of investors. Each class represents an interest in the same portfolio of investments. Certain financial intermediaries may not offer all classes of shares.
Class A Shares and Class C Shares are generally offered through financial intermediary platforms including, but not limited to, traditional brokerage platforms, mutual fund wrap fee programs, bank trust platforms, and retirement platforms. The maximum purchase in Class C Shares is $500,000 for any single purchase.
Class D Shares are generally no longer being made available to new investors who do not already have a direct account with the Janus funds. The Shares are available only to investors who held accounts directly with the Janus funds as of July 6, 2009 and to immediate family members or members of the same household of an eligible individual investor. The Shares are not offered through financial intermediaries.
Class I Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, and bank trust platforms, as well as certain retirement platforms. Class I Shares are also available to certain institutional investors including, but not limited to, corporations, certain retirement plans, public plans, and foundations/endowments.
Class L Shares are designed for pension and profit-sharing plans, employee benefit trusts, endowments, foundations and corporations, as well as high net worth individuals and financial intermediaries who are willing to maintain a minimum account balance of $250,000.
Class R Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms.
Class S Shares are offered through financial intermediary platforms including, but not limited to, retirement platforms and asset allocation, mutual fund wrap, or other discretionary or nondiscretionary fee-based investment advisory programs. In addition, Class S Shares may be available through certain financial intermediaries who have an agreement with Janus Capital Management LLC (“Janus Capital”) or its affiliates to offer Class S Shares on their supermarket platforms.
Class T Shares are available through certain financial intermediary platforms including, but not limited to, mutual fund wrap fee programs, managed account programs, asset allocation programs, bank trust platforms, and certain retirement platforms. In addition, Class T Shares may be available through certain financial intermediaries who have an agreement with Janus Capital or its affiliates to offer Class T Shares on their supermarket platforms.
The following accounting policies have been followed by the Funds and are in conformity with accounting principles generally accepted in the United States of America within the investment management industry.
Investment Valuation
Securities are valued at the last sales price or the official closing price for securities traded on a principal securities exchange (U.S. or foreign) and on the NASDAQ National Market. Securities traded on over-the-counter (“OTC”) markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees. Short-term securities with maturities of 60 days or less may be valued at amortized cost, which approximates market value. Debt securities with a remaining maturity of greater than 60 days are valued in accordance with the evaluated bid price supplied by the pricing service. The evaluated bid price supplied by the pricing service is an evaluation that reflects such factors as security prices, yields, maturities and ratings. Short positions shall be valued in accordance with the same methodologies, except that in the event that a last sale price is not available, the latest ask price shall be used instead of a bid price. Foreign securities and
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Notes to Financial Statements (unaudited) (continued)
currencies are converted to U.S. dollars using the applicable exchange rate in effect as of the daily close of the New York Stock Exchange (“NYSE”). When market quotations are not readily available or deemed unreliable, or events or circumstances that may affect the value of portfolio securities held by the Funds are identified between the closing of their principal markets and the time the net asset value (“NAV”) is determined, securities may be valued at fair value as determined in good faith under procedures established by and under the supervision of the Funds’ Trustees. Circumstances in which fair value pricing may be utilized include, but are not limited to: (i) a significant event that may affect the securities of a single issuer, such as a merger, bankruptcy, or significant issuer specific development; (ii) an event that may affect an entire market, such as a natural disaster or significant governmental action; (iii) a nonsignificant event such as a market closing early or not opening, or a security trading halt; and (iv) pricing of a non-valued security and a restricted or non-public security. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. Restricted and illiquid securities are valued in accordance with procedures established by the Funds’ Trustees.
Investment Transactions and Investment Income
Investment transactions are accounted for as of the date purchased or sold (trade date). Dividend income is recorded on the ex-dividend date. Certain dividends from foreign securities will be recorded as soon as the Trust is informed of the dividend, if such information is obtained subsequent to the ex-dividend date. Dividends from foreign securities may be subject to withholding taxes in foreign jurisdictions. Interest income is recorded on the accrual basis and includes amortization of premiums and accretion of discounts. Gains and losses are determined on the identified cost basis, which is the same basis used for federal income tax purposes. Income, as well as gains and losses, both realized and unrealized, are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets.
Expenses
Each Fund bears expenses incurred specifically on its behalf, as well as a portion of general expenses, which may be allocated pro rata to each Fund. Each class of shares bears expenses incurred specifically on its behalf and, in addition, each class bears a portion of general expenses, which are allocated daily to each class of shares based upon the ratio of net assets represented by each class as a percentage of total net assets. Expenses directly attributable to a specific class of shares are charged against the operations of such class.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates.
Foreign Currency Translations
The Funds do not isolate that portion of the results of operations resulting from the effect of changes in foreign exchange rates on investments from the fluctuations arising from changes in market prices of securities held at the date of the financial statements. Net unrealized appreciation or depreciation of investments and foreign currency translations arise from changes in the value of assets and liabilities, including investments in securities held at the date of the financial statements, resulting from changes in the exchange rates and changes in market prices of securities held.
Currency gains and losses are also calculated on payables and receivables that are denominated in foreign currencies. The payables and receivables are generally related to foreign security transactions and income.
Foreign currency-denominated assets and forward currency contracts may involve more risks than domestic transactions, including currency risk, political and economic risk, regulatory risk and equity risk. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of foreign currencies relative to the U.S. dollar.
Dividend Distributions
The Funds generally declare and distribute dividends of net investment income and realized capital gains (if any) annually. The majority of dividends and capital gains distributions from the Funds may be automatically reinvested into additional shares of that Fund, based on the discretion of the shareholder.
The Funds may make certain investments in real estate investment trusts (“REITs”) which pay dividends to their shareholders based upon funds available from operations. It is quite common for these dividends to exceed the REITs’ taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of
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capital. If the Funds distribute such amounts, such distributions could constitute a return of capital to shareholders for federal income tax purposes.
Federal Income Taxes
No provision for income taxes is included in the accompanying financial statements, as the Funds intend to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code applicable to regulated investment companies.
In accordance with the Financial Accounting Standards Board (“FASB”) guidance, the Funds adopted the provisions of “Income Taxes.” These provisions require an evaluation of tax positions taken (or expected to be taken) in the course of preparing a Fund’s tax returns to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements. The Funds recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense on the Statements of Operations.
These provisions require management of the Funds to analyze all open tax years, as defined by the Statute of Limitations, for all major jurisdictions, including federal tax authorities and certain state tax authorities. As of and during the period ended December 31, 2010, the Funds did not have a liability for any unrecognized tax benefits. The Funds have no examinations in progress and are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Valuation Inputs Summary
In accordance with FASB guidance, the Funds utilize the “Fair Value Measurements” to define fair value, establish a framework for measuring fair value, and expand disclosure requirements regarding fair value measurements. The Fair Value Measurement Standard does not require new fair value measurements, but is applied to the extent that other accounting pronouncements require or permit fair value measurements. This standard emphasizes that fair value is a market-based measurement that should be determined based on the assumptions that market participants would use in pricing an asset or liability. Various inputs are used in determining the value of the Funds’ investments defined pursuant to this standard. These inputs are summarized into three broad levels:
Level 1 – Quoted prices in active markets for identical securities.
Level 2 – Prices determined using other significant observable inputs. Observable inputs are inputs that reflect the assumptions market participants would use in pricing a security and are developed based on market data obtained from sources independent of the reporting entity. These may include quoted prices for similar securities, interest rates, prepayment speeds, credit risk, and others.
Debt securities are valued in accordance with the evaluated bid price supplied by the pricing service and generally categorized as Level 2 in the hierarchy. Securities traded on OTC markets and listed securities for which no sales are reported are valued at the latest bid price (or yield equivalent thereof) obtained from one or more dealers transacting in a market for such securities or by a pricing service approved by the Funds’ Trustees and are categorized as Level 2 in the hierarchy. Short-term securities with maturities of 60 days or less are valued at amortized cost, which approximates market value and are categorized as Level 2 in the hierarchy. Other securities that are categorized as Level 2 in the hierarchy include, but are not limited to, preferred stocks, bank loans, American Depositary Receipts (ADRs), Global Depositary Receipts (GDRs), warrants, swaps, investments in mutual funds, OTC options, and forward contracts. The Funds may use a systematic fair valuation model provided by an independent pricing service to value foreign equity securities in order to adjust for stale pricing, which may occur between the close of certain foreign exchanges and the NYSE. These are generally categorized as Level 2 in the hierarchy.
Level 3 – Prices determined using significant unobservable inputs. In situations where quoted prices or observable inputs are unavailable or deemed less relevant (for example, when there is little or no market activity for an investment at the end of the period), unobservable inputs may be used. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the factors market participants would use in pricing the security and would be based on the best information available under the circumstances.
For restricted equity securities and private placements where observable inputs are limited, assumptions about market activity and risk are used in employing valuation techniques such as the market
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Notes to Financial Statements (unaudited) (continued)
approach, the income approach, or the cost approach, as defined under the FASB Guidance. These are categorized as Level 3 in the hierarchy.
There have been no significant changes in valuation techniques used in valuing any such positions held by the Funds since the beginning of the fiscal year.
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The summary of inputs used as of December 31, 2010 to value the Funds’ investments in securities and other financial instruments is included in the “Valuation Inputs Summary” and “Level 3 Valuation Reconciliation of Assets” (if applicable) in the Notes to Schedules of Investments.
In April 2009, FASB issued “Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly,” which provides additional guidance for estimating fair value in accordance with Fair Value Measurements when the volume and level of activity for the asset or liability have significantly decreased as well as guidance on identifying circumstances that indicate a transaction is not orderly. Additionally, it amends the Fair Value Measurement Standard by expanding disclosure requirements for reporting entities surrounding the major categories of assets and liabilities carried at fair value. The required disclosures have been incorporated into the “Valuation Inputs Summary” in the Notes to Schedules of Investments. Management believes applying this guidance does not have a material impact on the financial statements.
The Funds adopted FASB Accounting Standards Update “Fair Value Measurements and Disclosures” (the “Update”). This Update applies to a Fund’s disclosures about transfers in and out of Level 1 and Level 2 of the fair value hierarchy and the reasons for the transfers. Disclosures about the valuation techniques and inputs used to measure fair value for investments that fall in either Level 2 or Level 3 fair value hierarchy are summarized under the Level 2 and Level 3 categories listed above. There were no transfers between Level 1 and Level 2 of the fair value hierarchy during the period.
The Funds recognize transfers between the levels as of the beginning of the fiscal year.
2. | Derivative Instruments |
The Funds may invest in various types of derivatives which may at times result in significant derivative exposure. A derivative is a financial instrument whose performance is derived from the performance of another asset. The Funds may invest in derivative instruments including, but not limited to: futures contracts, put options, call options, options on future contracts, options on foreign currencies, swaps, forward contracts, structured investments, and other equity-linked derivatives. A summary of derivative activity is reflected in the tables at the end of this section.
The Funds may use derivative instruments for hedging (to offset risks associated with an investment, currency exposure, or market conditions) or for speculative (to seek to enhance returns) purposes. When the Funds invest in a derivative for speculative purposes, the Funds will be fully exposed to the risks of loss of that derivative, which may sometimes be greater than the cost of the derivative. The Funds may not use any derivative to gain exposure to an asset or class of assets prohibited by their investment restrictions from purchasing directly. The Funds’ ability to use derivative instruments may also be limited by tax considerations.
Investments in derivatives are generally subject to equity risks that may cause their prices to fluctuate over time. Investments in derivatives may not directly correlate with the price movements of the underlying instrument. As a result, the use of derivatives may expose the Funds to additional risks that they would not be subject to if they invested directly in the securities underlying those derivatives. The use of derivatives may result in larger losses or smaller gains than otherwise would be the case. Derivatives can be volatile and may involve significant risks, including, but not limited to, counterparty risk, credit risk, currency risk, equity risk, index risk, interest rate risk, leverage risk, and liquidity risk.
Derivatives may generally be traded OTC or on an exchange. Derivatives traded OTC, such as structured notes, are agreements that are individually negotiated between parties and can be tailored to meet a purchaser’s needs. OTC derivatives are not guaranteed by a clearing agency and may be subject to increased credit risk.
In an effort to mitigate credit risk associated with derivatives traded OTC, the Funds may enter into collateral agreements with certain counterparties whereby, subject to certain minimum exposure requirements, a Fund may require the counterparty to post collateral if the Fund has a net aggregate unrealized gain on all OTC derivative contracts with a particular counterparty. There is no guarantee that counterparty exposure is reduced and these arrangements are dependent on Janus Capital’s ability to establish and maintain appropriate systems and trading.
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In pursuit of their investment objectives, each Fund may seek to use derivatives to increase or decrease exposure to the following market risk factors:
• | Counterparty Risk – Counterparty risk is the risk that the counterparty or a third party will not fulfill its obligation to a Fund. | |
• | Credit Risk – Credit risk is the risk an issuer will be unable to make principal and interest payments when due, or will default on its obligations. | |
• | Currency Risk – Currency risk is the risk that changes in the exchange rate between currencies will adversely affect the value (in U.S. dollar terms) of an investment. | |
• | Equity Risk – Equity risk relates to the change in value of equity securities as they relate to increases or decreases in the general market. | |
• | Index Risk – If the derivative is linked to the performance of an index, it will be subject to the risks associated with changes in that index. If the index changes, a Fund could receive lower interest payments or experience a reduction in the value of the derivative to below what the Fund paid. Certain indexed securities, including inverse securities (which move in an opposite direction to the index), may create leverage, to the extent that they increase or decrease in value at a rate that is a multiple of the changes in the applicable index. | |
• | Interest Rate Risk – Interest rate risk is the risk that the value of fixed-income securities will generally decline as prevailing interest rates rise, which may cause a Fund’s NAV to likewise decrease, and vice versa. | |
• | Leverage Risk – Leverage risk is the risk associated with certain types of leveraged investments or trading strategies pursuant to which relatively small market movements may result in large changes in the value of an investment. A Fund creates leverage by using borrowed capital to increase the amount invested, or investing in instruments, including derivatives, where the investment loss can exceed the original amount invested. Certain investments or trading strategies that involve leverage can result in losses that greatly exceed the amount originally invested. | |
• | Liquidity Risk – Liquidity risk is the risk that certain securities may be difficult or impossible to sell at the time that the seller would like or at the price that the seller believes the security is currently worth. |
Equity-Linked Structured Notes
The Funds may invest in equity-linked structured notes. Equity-linked structured notes are derivative securities which are specially designed to combine the characteristics of one or more underlying securities and their equity derivatives in a single note form. The return and/or yield or income component may be based on the performance of the underlying equity securities, an equity index, and/or option positions. Equity-linked structured notes are typically offered in limited transactions by financial institutions in either registered or non-registered form. An investment in equity-linked structured notes creates exposure to the credit risk of the issuing financial institution, as well as to the equity risk of the underlying securities. There is no guaranteed return of principal with these securities and the appreciation potential of these securities may be limited by a maximum payment or call right. In certain cases, equity-linked structured notes may be more volatile and less liquid than less complex securities or other types of fixed-income securities. Such securities may exhibit price behavior that does not correlate with other fixed-income securities.
Forward Foreign Currency Exchange Contracts
A forward foreign currency exchange contract (“forward currency contract”) is a commitment to purchase or sell a foreign currency at a future date at a negotiated rate. The Funds may enter into forward currency contracts for hedging purposes, including, but not limited to, reducing exposure to changes in foreign currency exchange rates on foreign portfolio holdings and locking in the U.S. dollar cost of firm purchase and sale commitments for securities denominated in or exposed to foreign currencies. The Funds may also invest in forward currency contracts for nonhedging purposes such as seeking to enhance returns. The Funds are subject to currency risk in the normal course of pursuing their investment objectives through their investments in forward currency contracts.
The gain or loss arising from the difference between the U.S. dollar cost of the original contract and the value of the foreign currency in U.S. dollars upon closing a contract is included in “Net realized gain/(loss) from investment and foreign currency transactions” on the Statements of Operations (if applicable).
Forward currency contracts held by the Funds are fully collateralized by other securities, which are denoted on the accompanying Schedules of Investments (if applicable). The collateral is evaluated daily to ensure its market value equals or exceeds the current market value of the
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Notes to Financial Statements (unaudited) (continued)
corresponding forward currency contracts. Such collateral is in the possession of the Funds’ custodian.
Futures Contracts
A futures contract is an exchange-traded agreement to take or make delivery of an underlying asset at a specific time in the future for a specific predetermined negotiated price. The Funds may enter into futures contracts to gain exposure to the stock market pending investment of cash balances or to meet liquidity needs. The Funds are subject to interest rate risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in futures contracts. The Funds may also use such derivative instruments to hedge or protect from adverse movements in securities prices, currency rates or interest rates. The use of futures contracts may involve risks such as the possibility of illiquid markets or imperfect correlation between the values of the contracts and the underlying securities, or that the counterparty will fail to perform its obligations.
Futures contracts are marked-to-market daily, and the daily variation margin is recorded as a receivable or payable on the Statements of Assets and Liabilities (if applicable). When a contract is closed, a realized gain or loss is recorded as “Net realized gain/(loss) from futures contracts” on the Statements of Operations (if applicable), equal to the difference between the opening and closing value of the contract. Generally, futures contracts are marked-to-market (i.e., treated as realized and subject to distribution) for federal income tax purposes at fiscal year-end. Securities held by the Funds that are designated as collateral for market value on futures contracts are noted on the Schedules of Investments (if applicable). Such collateral is in the possession of the Funds’ custodian or with the counterparty broker.
With futures, there is minimal counterparty credit risk to the Funds since futures are exchange-traded and the exchange’s clearinghouse, as counterparty to all exchange-traded futures, guarantees the futures against default.
Options Contracts
An options contract provides the purchaser with the right, but not the obligation, to buy (call option) or sell (put option) a financial instrument at an agreed upon price. The Funds may purchase or write covered and uncovered put and call options on futures contracts and on portfolio securities for hedging purposes or as a substitute for an investment. The Funds are subject to interest rate risk, liquidity risk, equity risk, and currency risk in the normal course of pursuing their investment objectives through their investments in options contracts. The Funds may use options contracts to hedge against changes in interest rates, the values of equities, or foreign currencies. The Funds may utilize American-style and European-style options. An American-style option is an option contract that can be exercised at any time between the time of purchase and the option’s expiration date. A European-style option is an option contract that can only be exercised on the option’s expiration date. The Funds may also purchase or write put and call options on foreign currencies in a manner similar to that in which futures or forward contracts on foreign currencies will be utilized. The Funds may also invest in long-term equity anticipation securities, which are long-term option contracts that can be maintained for a period of up to three years. The Funds generally invest in options to hedge against adverse movements in the value of portfolio holdings.
When an option is written, the Funds receive a premium and become obligated to sell or purchase the underlying security at a fixed price, upon exercise of the option. In writing an option, the Funds bear the risk of an unfavorable change in the price of the security underlying the written option. Exercise of an option written by the Funds could result in the Funds buying or selling a security at a price different from the current market value.
When an option is exercised, the proceeds on sales for a written call option, the purchase cost for a written put option, or the cost of the security for a purchased put or call option are adjusted by the amount of premium received or paid.
The Funds may also purchase and write exchange-listed and OTC put and call options on domestic securities indices, and on foreign securities indices listed on domestic and foreign securities exchanges. Options on securities indices are similar to options on securities except that (1) the expiration cycles of securities index options are monthly, while those of securities options are currently quarterly, and (2) the delivery requirements are different. Instead of giving the right to take or make delivery of securities at a specified price, an option on a securities index gives the holder the right to receive a cash “exercise settlement amount” equal to (a) the amount, if any, by which the fixed exercise price of the option exceeds (in the case of a put) or is less than (in the case of a call) the closing value of the underlying index on the date of exercise, multiplied by (b) a fixed “index multiplier.” Receipt of this cash amount will depend upon the closing level of the securities index upon which the option is based being greater than, in the case of a call, or less than, in the case of a put, the exercise price of the index and the exercise price of the option times a specified multiple. The writer of the option is obligated, in return for the premium received, to make delivery of this amount.
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Options traded on an exchange are regulated and the terms of the options are standardized. Options traded OTC expose the Funds to counterparty risk in the event that the counterparty does not perform. This risk is mitigated by having a netting arrangement between the Funds and the counterparty and by having the counterparty post collateral to cover the Funds’ exposure to the counterparty.
Holdings of the Funds designated to cover outstanding written options are noted on the Schedules of Investments (if applicable). Options written are reported as a liability on the Statements of Assets and Liabilities as “Options written at value” (if applicable).
Realized gains and losses are reported as “Net realized gain/(loss) from options contracts” on the Statements of Operations (if applicable).
The following Fund recognized realized gains/(losses) from written options contracts during the period ended December 31, 2010 as indicated in the table below:
Fund | Gains/(Losses) | ||||
Perkins Mid Cap Value Fund | $ | 42,820,472 | |||
The risk in writing call options is that the Funds give up the opportunity for profit if the market price of the security increases and the options are exercised. The risk in writing put options is that the Funds may incur a loss if the market price of the security decreases and the options are exercised. The risk in buying options is that the Funds pay a premium whether or not the options are exercised. The use of such instruments may involve certain additional risks as a result of unanticipated movements in the market. A lack of correlation between the value of an instrument underlying an option and the asset being hedged, or unexpected adverse price movements, could render the Funds’ hedging strategy unsuccessful. In addition, there can be no assurance that a liquid secondary market will exist for any option purchased or sold. There is no limit to the loss the Funds may recognize due to written call options.
Written option activity for the period ended December 31, 2010 is indicated in the tables below:
Number of | Premiums | |||||||
Put Options | Contracts | Received | ||||||
Perkins Mid Cap Value Fund | ||||||||
Options outstanding at June 30, 2010 | 116,956 | $ | 33,659,301 | |||||
Options written | 149,183 | 27,424,864 | ||||||
Options closed | – | – | ||||||
Options expired | (159,163) | (42,820,472) | ||||||
Options exercised | – | – | ||||||
Options outstanding at December 31, 2010 | 106,976 | $ | 18,263,693 | |||||
Number of | Premiums | |||||||
Call Options | Contracts | Received | ||||||
Perkins Value Plus Income Fund | ||||||||
Options outstanding at July 30, 2010 | – | $ | – | |||||
Options written | 7 | 314 | ||||||
Options closed | – | – | ||||||
Options expired | – | – | ||||||
Options exercised | – | – | ||||||
Options outstanding at December 31, 2010 | 7 | $ | 314 | |||||
Other Options
In addition to the option strategies described above, the Funds may purchase and sell a variety of options with non-standard payout structures or other features (“exotic options”). Exotic options are traded OTC and typically have price movements that can vary markedly from simple put or call options. The risks associated with exotic options are that they cannot be as easily priced and may be subject to liquidity risk. While some exotic options have fairly active markets, others are mostly thinly traded instruments. Some options are pure two-party transactions and may have no liquidity. The Funds may treat such instruments as illiquid and will limit their investments in such instruments to no more than 15% of a Fund’s net assets, when combined with all other illiquid investments of a Fund. The Funds may use exotic options to the extent that they are consistent with the Funds’ investment objectives and investment policies, and applicable regulations.
The Funds may purchase and sell exotic options that have values which are determined by the correlation of two or more underlying assets. These types of options include, but are not limited to, outperformance options, yield curve options or other spread options.
Swaps
A swap is an agreement that obligates two parties to exchange a series of cash flows at specified intervals based upon or calculated by reference to changes in specified prices or rates for a specified amount of an underlying asset. The Funds may utilize swap agreements as a means to gain exposure to certain common stocks and/or to “hedge” or protect their portfolios from adverse movements in securities prices or interest rates. The Funds are subject to equity risk and interest rate risk in the normal course of pursuing their investment objectives through investments in swap contracts. Swap agreements entail the risk that a party will default on its payment obligation to a Fund. If the other party to a swap defaults, a Fund would risk the loss of the net amount of the payments that it contractually is entitled to receive. If a Fund utilizes a swap at the wrong time or judges market conditions incorrectly, the swap may result in a loss to the Fund and reduce the Fund’s total return. Swap contracts
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Notes to Financial Statements (unaudited) (continued)
of the Funds are reported as an asset or liability on the Statements of Assets and Liabilities (if applicable). Realized gains and losses of the Funds are reported in “Net realized gain/(loss) from swap contracts” on the Statements of Operations (if applicable).
Various types of swaps such as credit default (funded and unfunded), dividend, equity, interest rate, and total return swaps are described below.
Credit default swaps are a specific kind of counterparty agreement that allows the transfer of third-party credit risk from one party to the other. The Funds are subject to credit risk in the normal course of pursuing their investment objectives through their investments in credit default swap contracts. The Funds may enter into credit default swaps to manage their exposure to the market or certain sectors of the market, to reduce their risk exposure to defaults of corporate and sovereign issuers, or to create exposure to corporate or sovereign issuers to which they are not otherwise exposed. With a credit default swap, one party in the swap is a lender and faces credit risk from a third party, and the counterparty in the credit default swap agrees to insure this risk in exchange for regular periodic payments. The Funds’ maximum risk of loss from counterparty risk, either as protection sellers or as protection buyers (undiscounted), is the notional value of the agreement. The risk is mitigated by having a netting arrangement between the Funds and the counterparty and by posting of collateral by the counterparty to the Funds to cover the Funds’ exposure to the counterparty.
Funded (notional value of contract paid up front) or unfunded (notional value only paid in case of default) credit default swaps are based on an index of credit default swaps (“CDXs”) or other similarly structured products. CDXs are designed to track segments of the credit default swap market and provide investors with exposure to specific reference baskets of issuers of bonds or loans. These instruments have the potential to allow an investor to obtain the same investment exposure as an investor who invests in an individual credit default swap, but with the potential added benefit of diversification. The CDX reference baskets are normally priced daily and rebalanced every six months in conjunction with leading market makers in the credit industry. The liquidity of the market for CDXs is normally subject to liquidity in the secured loan and credit derivatives markets. A Fund is normally only permitted to take long positions in CDXs.
Dividend swap agreements involve an exchange by the parties of their respective commitments to pay or right to receive the changes in a dividend index point. The Funds gain exposure by either paying or receiving an amount in respect of an increase or decrease in the change of the relevant dividend index point based on a notional amount. For example, if a Fund took a long position on a dividend index swap, the Fund would receive payments if the relevant index point increased in value and would be obligated to pay if that index point decreased in value.
Equity swaps involve the exchange by two parties of future cash flow (e.g., one cash flow based on a referenced interest rate and the other based on the performance of stock or a stock index).
Interest rate swaps involve the exchange by two parties of their respective commitments to pay or receive interest (e.g., an exchange of floating rate payments for fixed rate payments).
Total return swaps involve an exchange by two parties in which one party makes payments based on a set rate, either fixed or variable, while the other party makes payments based on the return of an underlying asset, which includes both the income it generates and any capital gains over the payment period.
The Funds’ maximum risk of loss for equity swaps, interest rate swaps and total return swaps from counterparty risk or credit risk is the discounted value of the payments to be received from/paid to the counterparty over the contract’s remaining life, to the extent that the amount is positive. The risk is mitigated by having a netting arrangement between the Funds and the counterparty and by the posting of collateral to the Funds to cover the Funds’ exposure to the counterparty.
In accordance with FASB guidance, the Funds adopted the provisions for “Derivatives and Hedging,” which require qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of and gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements.
The following tables, grouped by derivative type, provide information about the fair value and location of derivatives within the Statement of Assets and Liabilities as of December 31, 2010.
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Fair Value of Derivative Instruments as of December 31, 2010
Derivatives not accounted for | Asset Derivatives | Liability Derivatives | ||||||||||
as hedging instruments | Statement of Assets and Liabilities Location | Fair Value | Statement of Assets and Liabilities Location | Fair Value | ||||||||
Perkins Mid Cap Value Fund | ||||||||||||
Equity Contracts | Unaffiliated investments at value | $ | 27,756,508 | Options written, at value | $ | 5,819,585 | ||||||
Total | $ | 27,756,508 | $ | 5,819,585 | ||||||||
Derivatives not accounted for | Asset Derivatives | Liability Derivatives | ||||||||||
as hedging instruments | Statement of Assets and Liabilities Location | Fair Value | Statement of Assets and Liabilities Location | Fair Value | ||||||||
Perkins Value Plus Income Fund | ||||||||||||
Equity Contracts | Options written, at value | $ | 388 | |||||||||
Total | $ | 388 | ||||||||||
The following tables provide information about the effect of derivatives and hedging activities on the Funds’ Statement of Operations for the period ended December 31, 2010.
The effect of Derivative Instruments on the Statements of Operations for the six-month period ended December 31, 2010
Amount of Realized Gain/(Loss) on Derivatives Recognized in Income | ||||||||||||||||||||
Forward Currency | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Contracts | Total | |||||||||||||||
Perkins Large Cap Value Fund | ||||||||||||||||||||
Equity Contracts | $ | (70,421 | ) | $ | – | $ | – | $ | – | $ | (70,421 | ) | ||||||||
Total | $ | (70,421 | ) | $ | – | $ | – | $ | – | $ | (70,421 | ) | ||||||||
Change in Unrealized Appreciation/(Depreciation) on Derivatives Recognized in Income | ||||||||||||||||||||
Forward Currency | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Contracts | Total | |||||||||||||||
Perkins Large Cap Value Fund | ||||||||||||||||||||
Equity Contracts | $ | 172,437 | $ | – | $ | – | $ | – | $ | 172,437 | ||||||||||
Total | $ | 172,437 | $ | – | $ | – | $ | – | $ | 172,437 | ||||||||||
Amount of Realized Gain/(Loss) on Derivatives Recognized in Income | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Forward Currency Contracts | Total | |||||||||||||||
Perkins Mid Cap Value Fund | ||||||||||||||||||||
Equity Contracts | $ | – | $ | – | $ | (114,687,451 | ) | $ | – | $ | (114,687,451 | ) | ||||||||
Total | $ | – | $ | – | $ | (114,687,451 | ) | $ | – | $ | (114,687,451 | ) | ||||||||
Change in Unrealized Appreciation/(Depreciation) on Derivatives Recognized in Income | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Forward Currency Contracts | Total | |||||||||||||||
Perkins Mid Cap Value Fund | ||||||||||||||||||||
Equity Contracts | $ | – | $ | – | $ | (59,125,818 | ) | $ | – | $ | (59,125,818 | ) | ||||||||
Total | $ | – | $ | – | $ | (59,125,818 | ) | $ | – | $ | (59,125,818 | ) | ||||||||
Amount of Realized Gain/(Loss) on Derivatives Recognized in Income | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Forward Currency Contracts | Total | |||||||||||||||
Perkins Value Plus Income Fund | ||||||||||||||||||||
Equity Contracts | $ | (275 | ) | $ | – | $ | – | $ | – | $ | (275 | ) | ||||||||
Total | $ | (275 | ) | $ | – | $ | – | $ | – | $ | (275 | ) | ||||||||
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Notes to Financial Statements (unaudited) (continued)
Change in Unrealized Appreciation/(Depreciation) on Derivatives Recognized in Income | ||||||||||||||||||||
Derivatives not accounted for as hedging instruments | Futures | Swaps | Options | Forward Currency Contracts | Total | |||||||||||||||
Perkins Value Plus Income Fund | ||||||||||||||||||||
Equity Contracts | $ | – | $ | – | $ | (74 | ) | $ | – | $ | (74 | ) | ||||||||
Total | $ | – | $ | – | $ | (74 | ) | $ | – | $ | (74 | ) | ||||||||
Please see the Funds’ Statements of Operations for the Funds’ “Net Realized and Unrealized Gain/(Loss) on Investments.”
The value of derivative instruments at period end and the effect of derivatives on the Statements of Operations are indicative of the Funds’ volumes throughout the period.
3. | Other investments and strategies |
Additional Investment Risk
Unforeseen events in both domestic and international equity and fixed-income markets have resulted, and may continue to result, in an unusually high degree of volatility in the markets, with issuers that have exposure to the real estate, mortgage, and credit markets particularly affected. These events and the resulting market upheavals may have an adverse effect on the Funds, such as a decline in the value and liquidity of many securities held by the Funds, unusually high and unanticipated levels of redemptions, an increase in portfolio turnover, a decrease in NAV, and an increase in Fund expenses. Such unforeseen events may make it unusually difficult to identify both investment risks and opportunities and could limit or preclude each Fund’s ability to achieve its investment objective. The market’s behavior may at times be unpredictable. Therefore, it is important to understand that the value of your investment may fall, sometimes sharply, and you could lose money.
Further, the recent instability experienced in the financial markets has resulted in the U.S. Government and various other governmental and regulatory entities taking actions to address the financial crisis. These actions include, but are not limited to, the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) in July 2010 which is expected to dramatically change the way in which the U.S. financial system is supervised and regulated. More specifically, the Dodd-Frank Act provides for widespread regulation of financial institutions, consumer financial products and services, broker-dealers, over-the-counter derivatives, investment advisers, credit rating agencies, and mortgage lending, which expands federal oversight in the financial sector and may affect the investment management industry as a whole. Given the broad scope, sweeping nature, and the fact that many provisions of the Dodd-Frank Act must be implemented through future rulemaking, the ultimate impact of the Dodd-Frank Act, and any resulting regulation, is not yet certain. As a result, there can be no assurance that these measures will not have an adverse effect on the value or marketability of securities held by a Fund, including potentially limiting or completely restricting the ability of the Fund to use a particular investment instrument as part of its investment strategy, increasing the costs of using these instruments, or possibly making them less effective in general. Furthermore, no assurance can be made that the U.S. Government or any U.S. regulatory entity (or other authority or regulatory entity) will not continue to take further legislative or regulatory action in response to the economic crisis or otherwise, and the effect of such actions, if taken, cannot be known.
The average monthly value of borrowings outstanding under bank loan arrangements and the related rate range during the period ended December 31, 2010 is indicated in the table below:
Average Monthly | ||||||||
Fund | Value | Rates | ||||||
Perkins Value Plus Income Fund | $ | 147,341 | 0.0000% - 6.7500% | |||||
Counterparties
Fund transactions involving a counterparty are subject to the risk that the counterparty or a third party will not fulfill its obligation to a Fund (“counterparty risk”). Counterparty risk may arise because of the counterparty’s financial condition (i.e., financial difficulties, bankruptcy, or insolvency), market activities and developments, or other reasons, whether foreseen or not. A counterparty’s inability to fulfill its obligation may result in significant financial loss to a Fund. A Fund may be unable to recover its investment from the counterparty or may obtain a limited recovery, and/or recovery may be delayed. The extent of a Fund’s exposure to counterparty risk in respect to financial assets approximates their carrying value as recorded on the Fund’s Statement of Assets and Liabilities.
A Fund may be exposed to counterparty risk through participation in various programs including, but not limited to, lending its securities to third parties, cash sweep arrangements whereby a Fund’s cash balance is invested in one or more types of cash management vehicles, as
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well as investments in, but not limited to, repurchase agreements, debt securities, and derivatives, including various types of swaps, futures and options. A Fund intends to enter into financial transactions with counterparties that Janus Capital believes to be creditworthy at the time of the transaction. There is always the risk that Janus Capital’s analysis of a counterparty’s creditworthiness is incorrect or may change due to market conditions. To the extent that a Fund focuses its transactions with a limited number of counterparties, it will have greater exposure to the risks associated with one or more counterparties.
Exchange-Traded Funds
The Funds may invest in exchange-traded funds, which generally are index-based investment companies that hold substantially all of their assets in securities representing their specific index. As a shareholder of another investment company, a Fund would bear its pro rata portion of the other investment company’s expenses, including advisory fees, in addition to the expenses the Fund bears directly in connection with its own operations.
Exchange-Traded Notes
The Funds may invest directly in exchange-traded notes (“ETNs”), which are senior, unsecured, unsubordinated debt securities whose returns are linked to a particular index and provide exposure to the total returns of various market indices, including indices linked to stocks, bonds, commodities and currencies. This type of debt security differs from other types of bonds and notes. ETN returns are based upon the performance of a market index minus applicable fees; no periodic coupon payments are distributed and no principal protections exist. ETNs do not pay cash distributions. Instead, the value of dividends, interest, and investment gains are captured in a Fund’s total return. The Funds will invest in these securities when desiring exposure to debt securities or commodities. When evaluating ETNs for investment, Janus Capital will consider the potential risks involved, expected tax efficiency, rate of return, and credit risk. When the Funds invest in ETNs, they will bear their proportionate share of any fees and expenses borne by the ETN. There may be restrictions on the Funds’ right to redeem their investment in an ETN, which is meant to be held until maturity. The Funds’ decision to sell their ETN holdings may be limited by the availability of a secondary market.
Initial Public Offerings
The Funds may invest in initial public offerings (“IPOs”). IPOs and other investment techniques may have a magnified performance impact on a Fund with a small asset base. The Funds may not experience similar performance as their assets grow.
Interfund Lending
As permitted by the Securities and Exchange Commission (“SEC”), or the 1940 Act and rules promulgated thereunder, the Funds may be party to interfund lending agreements between the Funds and other Janus Capital sponsored mutual funds and certain pooled investment vehicles, which permit them to borrow or lend cash at a rate beneficial to both the borrowing and lending funds. Outstanding borrowings from all sources totaling 10% or more of the borrowing Fund’s total assets must be collateralized at 102% of the outstanding principal value of the loan; loans of less than 10% may be unsecured.
Restricted Security Transactions
Restricted securities held by the Funds may not be sold except in exempt transactions or in a public offering registered under the Securities Act of 1933, as amended. The risk of investing in such securities is generally greater than the risk of investing in the securities of widely held, publicly traded companies. Lack of a secondary market and resale restrictions may result in the inability of the Funds to sell a security at a fair price and may substantially delay the sale of the security. In addition, these securities may exhibit greater price volatility than securities for which secondary markets exist.
Securities Lending
Under procedures adopted by the Trustees, the Funds may seek to earn additional income through lending their securities to certain qualified broker-dealers and institutions on a short-term or long-term basis. The Funds may lend portfolio securities on a short-term or long-term basis, in an amount equal to up to 1/3 of their total assets as determined at the time of the loan origination. When the Funds lend their securities, they receive collateral (including cash collateral), at least equal to the value of securities loaned. The Funds may earn income by investing this collateral in one or more affiliated or non-affiliated cash management vehicles. It is also possible that, due to a decline in the value of a cash management vehicle, the Funds may lose money. There is also the risk that when portfolio securities are lent, the securities may not be returned on a timely basis, and the Funds may experience delays and costs in recovering the security or gaining access to the collateral provided to the Funds to collateralize the loan. If the Funds are unable to recover a security on loan, the Funds may use the collateral to purchase replacement securities in the market. There is a risk that the value of the collateral could decrease below the cost of the replacement security by the time the replacement investment is made, resulting in a loss to the Funds. Janus Capital intends to manage the cash collateral in an affiliated cash management vehicle and
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Notes to Financial Statements (unaudited) (continued)
will receive an investment advisory fee for managing such assets.
The borrower pays fees at the Funds’ direction to Deutsche Bank AG (the “Lending Agent”). The Lending Agent may retain a portion of the interest earned on the cash collateral invested. The cash collateral invested by the Lending Agent is disclosed on the Schedules of Investments (if applicable). The lending fees and the Funds’ portion of the interest income earned on cash collateral are included on the Statements of Operations (if applicable).
The Funds did not have any securities on loan during the period.
Short Sales
The Funds may engage in “short sales against the box.” Short sales against the box involve either selling short a security that the Funds own or selling short a security that the Funds have the right to obtain, for delivery at a specified date in the future. The Funds may enter into short sales against the box to hedge against anticipated declines in the market price of portfolio securities. The Funds do not deliver from their portfolios the securities sold short and do not immediately receive the proceeds of the short sale. The Funds borrow the securities sold short and receive proceeds from the short sale only when they deliver the securities to the lender. If the value of the securities sold short increases prior to the scheduled delivery date, the Funds lose the opportunity to participate in the gain.
The Funds may also engage in other short sales. The Funds may engage in short sales when the portfolio managers anticipate that a security’s market purchase price will be less than its borrowing price. To complete the transaction, the Funds must borrow the security to deliver it to the purchaser and buy that same security in the market to return it to the lender. No more than 10% of a Fund’s net assets may be invested in short positions (through short sales of stocks, structured products, futures, swaps, and uncovered written calls). The Funds may engage in short sales “against the box” and options for hedging purposes that are not subject to this 10% limit. Although the potential for gain as a result of a short sale is limited to the price at which the Fund sold the security short less the cost of borrowing the security, the potential for loss is theoretically unlimited because there is no limit to the cost of replacing the borrowed security. There is no assurance the Funds will be able to close out a short position at a particular time or at an acceptable price. A gain or a loss will be recognized upon termination of a short sale. Short sales held by the Funds are fully collateralized by restricted cash or other securities, which are denoted on the accompanying Schedules of Investments (if applicable). The Funds are also required to pay the lender of the security any dividends or interest that accrues on a borrowed security during the period of the loan. Depending on the arrangements made with the broker or custodian, a Fund may or may not receive any payments (including interest) on collateral it has deposited with the broker. The Funds pay stock loan fees on assets borrowed from the security broker.
The Funds may also enter into short positions through derivative instruments, such as options contracts, futures contracts, and swap agreements, which may expose the Funds to similar risks. To the extent that the Funds enter into short derivative positions, the Funds may be exposed to risks similar to those associated with short sales, including the risk that the Funds’ losses are theoretically unlimited.
4. | Investment Advisory Agreements and Other Transactions with Affiliates |
Each Fund pays Janus Capital an investment advisory fee which is calculated daily and paid monthly. The following table reflects certain Funds’ “base” fee rates prior to any performance adjustment and Perkins Value Plus Income Fund’s contractual investment advisory fee rate (expressed as an annual rate).
Contractual | ||||||||
Investment | ||||||||
Advisory Fee/ | ||||||||
Average Daily Net | Base Fee (%) | |||||||
Fund | Assets of the Fund | (annual rate) | ||||||
Perkins Large Cap Value Fund | N/A | 0.64 | ||||||
Perkins Mid Cap Value Fund | N/A | 0.64 | ||||||
Perkins Small Cap Value Fund | N/A | 0.72 | ||||||
Perkins Value Plus Income Fund | All Asset Levels | 0.60 | ||||||
For each Fund, except Perkins Value Plus Income Fund, the investment advisory fee rate is determined by calculating a base fee and applying a performance adjustment. The base fee rate is the same as the contractual investment advisory fee rate shown in the table above. The performance adjustment either increases or decreases the base fee depending on how well each Fund has performed relative to its benchmark index, as shown below:
Fund | Benchmark Index | ||||
Perkins Large Cap Value Fund | Russell 1000® Value Index | ||||
Perkins Mid Cap Value Fund | Russell Midcap® Value Index | ||||
Perkins Small Cap Value Fund | Russell 2000® Value Index | ||||
Only the base fee rate applied until February 2007 for Perkins Mid Cap Value Fund and January 2010 for each of Perkins Large Cap Value Fund and Perkins Small Cap
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Value Fund, at which time the calculation of the performance adjustment applies as follows:
Investment Advisory Fee = Base Fee Rate +/- Performance Adjustment
The investment advisory fee rate paid to Janus Capital by each of the Funds listed above consists of two components: (1) a base fee calculated by applying the contractual fixed rate of the advisory fee to the Fund’s average daily net assets during the previous month (“Base Fee Rate”), plus or minus (2) a performance-fee adjustment (“Performance Adjustment”) calculated by applying a variable rate of up to 0.15% (positive or negative) to the Fund’s average daily net assets during the applicable performance measurement period. The performance measurement period generally is the previous 36 months, although no Performance Adjustment is made until the performance-based fee structure has been in effect for at least 12 months and, accordingly, only the Fund’s Base Fee Rate applies for the initial 12 months. When the performance-based fee structure has been in effect for at least 12 months, but less than 36 months, the performance measurement period will be equal to the time that has elapsed since the performance-based fee structure took effect. As noted above, any applicable Performance Adjustments began February 2007 for Perkins Mid Cap Value Fund and January 2010 for each of Perkins Large Cap Value Fund and Perkins Small Cap Value Fund.
No Performance Adjustment is applied unless the difference between a Fund’s investment performance and the cumulative investment record of the Fund’s benchmark index is 0.50% or greater (positive or negative) during the applicable performance measurement period. The Base Fee Rate is subject to an upward or downward performance adjustment for every full 0.50% increment by which a Fund outperforms or underperforms its benchmark index. Because the Performance Adjustment is tied to a Fund’s performance relative to its benchmark index (and not its absolute performance), the Performance Adjustment could increase Janus Capital’s fee even if the Fund’s Shares lose value during the performance measurement period and could decrease Janus Capital’s fee even if the Fund’s Shares increase in value during the performance measurement period. For purposes of computing the Base Fee Rate and the Performance Adjustment, net assets are averaged over different periods (average daily net assets during the previous month for the Base Fee Rate, versus average daily net assets during the performance measurement period for the Performance Adjustment). Performance of a Fund is calculated net of expenses, whereas a Fund’s benchmark index does not have any fees or expenses. Reinvestment of dividends and distributions is included in calculating both the performance of a Fund and the Fund’s benchmark index. The Base Fee Rate is calculated and accrued daily. The Performance Adjustment is calculated monthly in arrears and is accrued throughout the month. The investment fee is paid monthly in arrears. Under extreme circumstances involving underperformance by a rapidly shrinking Fund, the dollar amount of the Performance Adjustment could be more than the dollar amount of the Base Fee Rate. In such circumstances, Janus Capital would reimburse the applicable Fund.
The application of an expense limit, if any, will have a positive effect upon a Fund’s performance and may result in an increase in the Performance Adjustment. It is possible that the cumulative dollar amount of additional compensation ultimately payable to Janus Capital may, under some circumstances, exceed the cumulative dollar amount of management fees waived by Janus Capital.
The investment performance of a Fund’s Class A Shares (waiving the upfront sales load) for the performance measurement period is used to calculate the Performance Adjustment. For performance measurement periods prior to July 6, 2009, certain Funds calculated their Performance Adjustment by comparing the performance of Class T Shares (formerly named Class J Shares) against the investment record of each Fund’s respective benchmark index. For periods beginning July 6, 2009, the investment performance of each Fund’s load-waived Class A Shares for the performance measurement period is used to calculate the Performance Adjustment. Because the Performance Adjustment is based on a rolling 36-month performance measurement period, calculations based solely on the performance of a Fund’s load-waived Class A Shares will not be fully implemented for 36 months after July 6, 2009. During this transition period, the Fund’s performance will be compared to a blended investment performance record that includes the Fund’s Class T Shares (formerly named Class J Shares) performance (the prior share class used for performance calculations) for the portion of the performance measurement period prior to July 6, 2009, and the Fund’s load-waived Class A Shares for the remainder of the period. At the conclusion of the transition period, the Fund’s Class T Shares will be eliminated from the Performance Adjustment calculation, and the calculation will be based solely upon the Fund’s load-waived Class A Shares. After Janus Capital determines whether a particular Fund’s performance was above or below its benchmark index by comparing the investment performance of the Fund’s load-waived Class A Shares, or Class T Shares (formerly named Class J Shares) as the case may be, against the cumulative investment record of the Fund’s benchmark index, Janus Capital applies the same Performance Adjustment (positive or negative)
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Notes to Financial Statements (unaudited) (continued)
across each other class of shares of the Fund, as applicable.
It is not possible to predict the effect of the Performance Adjustment on future overall compensation to Janus Capital since it depends on the performance of each Fund relative to the record of the Fund’s benchmark index and future changes to the size of each Fund.
The Funds’ prospectuses and statements of additional information contain additional information about performance-based fees. The amount shown as advisory fees on the Statements of Operations reflects the Base Fee Rate plus/minus any Performance Adjustment.
During the period ended December 31, 2010, the following Funds recorded a Performance Adjustment as indicated in the table below:
Performance | |||||
Fund | Fee | ||||
Perkins Large Cap Value Fund | $ | 19,252 | |||
Perkins Mid Cap Value Fund | 6,235,837 | ||||
Perkins Small Cap Value Fund | 1,229,709 | ||||
Perkins Investment Management LLC (“Perkins”) serves as subadviser to the Funds. Janus Capital pays Perkins a subadvisory fee rate equal to 50% of the investment advisory fee paid by the Funds to Janus Capital (calculated after any applicable performance fee adjustment, fee waivers, and expense reimbursements). The subadvisory fee paid by Janus Capital to Perkins adjusts up or down based on the Funds’ performance relative to their benchmark indices over the performance measurement period.
Perkins or its predecessors have been in the investment management business since 1984 and serves as investment adviser or subadviser to other Janus registered investment companies and other accounts. The same level of services is expected to be provided under the subadvisory arrangement as is currently provided. Janus Capital owns approximately 78% of Perkins.
Janus Services LLC (“Janus Services”), a wholly-owned subsidiary of Janus Capital, is the Funds’ transfer agent. In addition, Janus Services provides or arranges for the provision of certain other administrative services including, but not limited to, recordkeeping, accounting, order processing, and other shareholder services for the Funds.
Class D Shares of the Funds pay an annual administrative services fee of 0.12% of net assets. These administrative services fees are paid by the Shares of each Fund for shareholder services provided by Janus Services.
Janus Services receives an administrative services fee at an annual rate of 0.25% of the average daily net assets of Class R Shares, Class S Shares and Class T Shares of the Funds for providing or procuring administrative services to investors in Class R Shares, Class S Shares and Class T Shares of the Funds. Janus Services expects to use all or a significant portion of this fee to compensate retirement plan service providers, broker-dealers, bank trust departments, financial advisors, and other financial intermediaries for providing these services. Services provided by these financial intermediaries may include, but are not limited to, recordkeeping, subaccounting, order processing, providing periodic statements, forwarding prospectuses, shareholder reports, and other materials to existing customers and other administrative services. Order processing includes the submission of transactions through the National Securities Clearing Corporation (“NSCC”) or similar systems, or those processed on a manual basis with Janus. Janus Services or its affiliates may also pay fees for services provided by intermediaries to the extent the fees charged by intermediaries exceed the 0.25% of net assets charged to Class R Shares, Class S Shares, and Class T Shares of each Fund.
For transfer agency and other services, Janus Services receives an asset-weighted fee from the Class L Shares of Perkins Mid Cap Value Fund and Perkins Small Cap Value Fund based on the average proportion of each Fund’s total net assets sold directly and the average proportion of each Fund’s net assets sold through financial intermediaries on a monthly basis. The asset-weighted fee is calculated by applying a blended annual fee rate of 0.12% on average net assets for the proportion of assets sold directly and 0.25% on average net assets for the proportion of assets sold through financial intermediaries. Depending on the shareholder composition of a Fund each month, the asset-weighted fee could increase or decrease from the amount that otherwise would have been paid under the prior transfer agency fee structure.
Janus Services has agreed to waive all or a portion of the administrative fees payable by the Class L Shares of Perkins Mid Cap Value Fund and Perkins Small Cap Value Fund. Such waiver is voluntary and could change or be terminated at any time at the discretion of Janus Services or Janus Capital without prior notification to shareholders. Removal of this fee waiver may have a significant impact on Class L Shares’ total expense ratio. If applicable, amounts waived to the Funds by Janus Capital are disclosed as “Excess Expense Reimbursement��� on the Statements of Operations.
Certain, but not all, intermediaries may charge administrative fees to investors in Class A, Class C, and Class I Shares for administrative services provided on behalf of such investors. These administrative fees are paid by the Class A Shares, Class C Shares, and Class I Shares of the Funds to Janus Services, which uses such
94 | DECEMBER 31, 2010
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fees to reimburse intermediaries. Janus Services may negotiate the level, structure, and/or terms of the administrative fees with intermediaries requiring such fees on behalf of the Funds. Janus Capital and its affiliates benefit from an increase in assets that may result from such relationships.
Janus Distributors LLC (“Janus Distributors”), a wholly-owned subsidiary of Janus Capital, is the distributor of the Funds. The Funds have adopted a Distribution and Shareholder Servicing Plan (the “Plan”) pursuant to Rule 12b-1 under the 1940 Act. The Plan authorizes payments by the Funds at an annual rate, as determined from time to time by the Board of Trustees, of up to 0.25% of the Class A Shares average daily net assets, of up to 1.00% of the Class C Shares average daily net assets, of up to 0.50% of the Class R Shares average daily net assets, and of up to 0.25% of the Class S Shares average daily net assets. Payments under the Plan are not tied exclusively to actual distribution and shareholder service expenses, and the payments may exceed distribution and shareholder service expenses actually incurred by the Funds. If any of a Fund’s actual distribution and shareholder service expenses incurred during a calendar year are less than the payments made during a calendar year, the Fund will be refunded for the difference. Refunds, if any, are included in the “Distribution fees and shareholder servicing fees” in the Statements of Operations.
Janus Capital has agreed to reimburse the Funds until at least November 1, 2011 by the amount, if any, that such Fund’s normal operating expenses in any fiscal year, including the investment advisory fee, but excluding any performance adjustments to management fees, if applicable, class-specific distribution and shareholder servicing fees applicable to Class A Shares, Class C Shares, Class R Shares, and Class S Shares, the administrative services fees payable pursuant to the Transfer Agency Agreement applicable to Class D Shares, Class L Shares, Class R Shares, Class S Shares, and Class T Shares, brokerage commissions, interest, dividends, taxes and extraordinary expenses (including, but not limited to, acquired fund fees and expenses), exceed the annual rates noted below. If applicable, amounts reimbursed to the Funds by Janus Capital are disclosed as “Excess Expense Reimbursement” on the Statements of Operations.
Expense | |||||
Fund | Limit (%) | ||||
Perkins Large Cap Value Fund | 1.00 | ||||
Perkins Mid Cap Value Fund | 0.86 | ||||
Perkins Small Cap Value Fund | 0.96 | ||||
Perkins Value Plus Income Fund | 0.76 | ||||
The Board of Trustees has adopted a deferred compensation plan (the “Deferred Plan”) for independent Trustees to elect to defer receipt of all or a portion of the annual compensation they are entitled to receive from the Funds. All deferred fees are credited to an account established in the name of the Trustees. The amounts credited to the account then increase or decrease, as the case may be, in accordance with the performance of one or more of the Janus funds that are selected by the Trustees. The account balance continues to fluctuate in accordance with the performance of the selected fund or funds until final payment of all amounts are credited to the account. The fluctuation of the account balance is recorded by the Funds as unrealized appreciation/(depreciation) and is shown as of December 31, 2010 on the Statements of Assets and Liabilities as an asset, “Non-interested Trustees’ deferred compensation,” and a liability, “Non-interested Trustees’ deferred compensation fees.” Additionally, the recorded unrealized appreciation/(depreciation) is included in “Unrealized net appreciation/(depreciation) of investments, foreign currency translations and non-interested Trustees’ deferred compensation” on the Statements of Assets and Liabilities. Deferred compensation expenses for the period ended December 31, 2010 are included in “Non-interested Trustees’ fees and expenses” on the Statements of Operations. Trustees are allowed to change their designation of mutual funds from time to time. Amounts will be deferred until distributed in accordance with the Deferred Plan. No deferred fees were distributed to any Trustee under the Deferred Plan during the period ended December 31, 2010.
For the period ended December 31, 2010, Janus Capital assumed $28,267 of legal, consulting and Trustee costs and fees incurred by the funds in the Trust and Janus Aspen Series together with the Trust (the “Portfolios”), in connection with the regulatory and civil litigation matters discussed in Note 11. These non-recurring costs were allocated to all Portfolios based on the Portfolios’ respective net assets as of July 31, 2004. Unless noted otherwise in the financial highlights, the effect of these non-recurring costs assumed by Janus Capital are included in the ratio of gross expenses to average net assets and were less than 0.01%. No fees were allocated to the Portfolios that commenced operations after July 31, 2004. Additionally, all future non-recurring costs will be allocated to the Portfolios based on the Portfolios’ respective net assets on July 31, 2004. These “Non-recurring costs” and “Costs assumed by Janus Capital” are shown on the Statements of Operations.
Certain officers of the Funds may also be officers and/or directors of Janus Capital. Such officers receive no compensation from the Funds, except for the Funds’ Chief
Janus Value Funds | 95
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Notes to Financial Statements (unaudited) (continued)
Compliance Officer. The Funds reimburse Janus Capital for a portion of the compensation paid to the Chief Compliance Officer and certain compliance staff of the Trust. Total compensation of $266,383 was paid by the Trust during the period ended December 31, 2010. Each Fund’s portion is reported as part of “Other Expenses” on the Statements of Operations.
Class A Shares include a 5.75% upfront sales charge of the offering price of the Funds. The sales charge is allocated between Janus Distributors and financial intermediaries. During the period ended December 31, 2010, Janus Distributors retained the following upfront sales charges:
Upfront | |||||
Fund (Class A Shares) | Sales Charge | ||||
Perkins Large Cap Value Fund | $ | 1,194 | |||
Perkins Mid Cap Value Fund | 47,292 | ||||
Perkins Small Cap Value Fund | 4,109 | ||||
Perkins Value Plus Income Fund | 99 | ||||
A contingent deferred sales charge of 1.00% will be deducted with respect to Class A Shares purchased without a sales load and redeemed within 12 months of purchase, unless waived, as discussed in the Prospectus. Any applicable CDSC will be 1.00% of the lesser of the original purchase price or the value of the redemption of the Class A Shares redeemed. There were no contingent deferred sales charges paid by redeeming shareholders of Class A Shares during the period ended December 31, 2010.
Class C Shares include a 1.00% contingent deferred sales charge paid by redeeming shareholders to Janus Distributors. The contingent deferred sales charge applies to shares redeemed within 12 months of purchase. The redemption price may differ from the net asset value per share. During the period ended December 31, 2010, redeeming shareholders of Class C Shares paid the following contingent deferred sales charges:
Contingent Deferred | |||||
Fund (Class C Shares) | Sales Charge | ||||
Perkins Mid Cap Value Fund | $ | 5,554 | |||
Perkins Small Cap Value Fund | 1,820 | ||||
The Funds’ expenses may be reduced by expense offsets from an unaffiliated custodian and/or transfer agent. Such credits or offsets are included in “Expense and Fee Offset” on the Statements of Operations (if applicable). The transfer agent fee offsets received during the period reduce “Transfer agent fees and expenses” on the Statements of Operations (if applicable). Custodian offsets received reduce “Custodian fees” on the Statements of Operations (if applicable). The Funds could have employed the assets used by the custodian and/or transfer agent to produce income if they had not entered into an expense offset arrangement.
Pursuant to the terms and conditions of an SEC exemptive order and the provisions of the 1940 Act, the Funds may participate in an affiliated or non-affiliated cash sweep program. In the cash sweep program, uninvested cash balances of the Funds may be used to purchase shares of affiliated or non-affiliated money market funds or cash management pooled investment vehicles. The Funds are eligible to participate in the cash sweep program (the “Investing Funds”). Janus Cash Liquidity Fund LLC is an affiliated unregistered cash management pooled investment vehicle that invests primarily in highly-rated short-term fixed-income securities. Janus Cash Liquidity Fund LLC currently maintains a NAV of $1.00 per share and distributes income daily in a manner consistent with a registered 2a-7 product. There are no restrictions on the Funds’ ability to withdraw investments from Janus Cash Liquidity Fund LLC at will, and there are no unfunded capital commitments due from the Funds to Janus Cash Liquidity Fund LLC. As adviser, Janus Capital has an inherent conflict of interest because of its fiduciary duties to the affiliated cash management pooled investment vehicles and the Investing Funds.
During the period ended December 31, 2010, the following Fund recorded distributions from affiliated investment companies as affiliated dividend income, and had the following affiliated purchases and sales:
Purchases | Sales | Dividend | Value | |||||||||||
Shares/Cost | Shares/Cost | Income | at 12/31/10 | |||||||||||
Janus Cash Liquidity Fund LLC | ||||||||||||||
Perkins Value Plus Income Fund | $ | 12,710,838 | $ | (10,565,000) | $ | 1,274 | $ | 2,145,838 | ||||||
96 | DECEMBER 31, 2010
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Janus Capital or an affiliate invested and/or redeemed initial seed capital during the period ended December 31, 2010, as indicated in the following table.
Seed Capital | Date of | Date of | Seed Capital | |||||||||||||||||
Fund | at 6/30/10 | Purchases | Purchases | Redemptions | Redemption | at 12/31/10 | ||||||||||||||
Perkins Large Cap Value Fund - Class C Shares | $ | 500,000 | $ | – | – | $ | – | – | $ | 500,000 | ||||||||||
Perkins Large Cap Value Fund - Class D Shares | 10,000 | – | – | – | – | 10,000 | ||||||||||||||
Perkins Large Cap Value Fund - Class S Shares | 500,000 | – | – | – | – | 500,000 | ||||||||||||||
Perkins Large Cap Value Fund - Class T Shares | 11,000 | – | – | – | – | 11,000 | ||||||||||||||
Perkins Value Plus Income Fund - Class A Shares | – | 3,333,333 | 7/29/10 | – | – | 3,333,333 | ||||||||||||||
Perkins Value Plus Income Fund - Class C Shares | – | 3,333,333 | 7/29/10 | – | – | 3,333,333 | ||||||||||||||
Perkins Value Plus Income Fund - Class D Shares | – | 3,333,333 | 7/29/10 | – | – | 3,333,333 | ||||||||||||||
Perkins Value Plus Income Fund - Class I Shares | – | 3,333,334 | 7/29/10 | – | – | 3,333,334 | ||||||||||||||
Perkins Value Plus Income Fund - Class S Shares | – | 3,333,333 | 7/29/10 | – | – | 3,333,333 | ||||||||||||||
Perkins Value Plus Income Fund - Class T Shares | – | 3,333,334 | 7/29/10 | – | – | 3,333,334 | ||||||||||||||
5. | Federal Income Tax |
Income and capital gains distributions are determined in accordance with income tax regulations that may differ from accounting principles generally accepted in the United States of America. These differences are due to differing treatments for items such as net short-term gains, deferral of wash sale losses, foreign currency transactions, net investment losses and capital loss carryovers.
The Funds have elected to treat gains and losses on forward foreign currency contracts as capital gains and losses, if applicable. Other foreign currency gains and losses on debt instruments are treated as ordinary income for federal income tax purposes pursuant to Section 988 of the Internal Revenue Code.
The aggregate cost of investments and the composition of unrealized appreciation and depreciation of investment securities for federal income tax purposes as of December 31, 2010 are noted below.
Unrealized appreciation and unrealized depreciation in the table below exclude appreciation/(depreciation) on foreign currency translations. The primary difference between book and tax appreciation or depreciation of investments is wash sale loss deferrals.
Federal Tax | Unrealized | Unrealized | ||||||||||||
Fund | Cost | Appreciation | (Depreciation) | Net Tax Appreciation | ||||||||||
Perkins Large Cap Value Fund | $ | 92,039,723 | $ | 12,495,327 | $ | (577,779) | $ | 11,917,548 | ||||||
Perkins Mid Cap Value Fund | 11,841,780,371 | 2,330,866,831 | (160,411,053) | 2,170,455,778 | ||||||||||
Perkins Small Cap Value Fund | 2,865,650,031 | 470,397,652 | (29,170,669) | 441,226,983 | ||||||||||
Perkins Value Plus Income Fund | 26,293,904 | 1,642,103 | (134,878) | 1,507,225 | ||||||||||
Net capital loss carryovers as of June 30, 2010 are indicated in the table below. These losses may be available to offset future realized capital gains and thereby reduce future taxable gains distributions. The following table shows the expiration dates of the carryovers.
Capital Loss Carryover Expiration Schedule
For the eight-month fiscal period ended June 30, 2010
Accumulated | |||||||||||
Fund | June 30, 2016 | June 30, 2017 | Capital Losses | ||||||||
Perkins Mid Cap Value Fund(1) | (104,418,676) | (478,062,505) | (582,481,181) | ||||||||
Perkins Small Cap Value Fund(1) | (11,925,972) | – | (11,925,972) | ||||||||
(1) | Capital loss carryovers subject to annual limitations. |
Janus Value Funds | 97
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Notes to Financial Statements (unaudited) (continued)
6. | Expense Ratios |
The expense ratios listed in the Financial Highlights reflect expenses prior to any expense offsets (gross expense ratio) and after expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursement). Listed below are the gross expense ratios for the Funds that would have been in effect, absent the waiver of certain fees and offsets.
For the six-month period ended December 31, 2010 (unaudited),
the eight- or eleven-month fiscal period ended June 30, 2010
and each fiscal year or period ended October 31 or July 31
the eight- or eleven-month fiscal period ended June 30, 2010
and each fiscal year or period ended October 31 or July 31
Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | |||||||||||||
Value Fund | Value Fund | Value Fund | Income Fund(1) | |||||||||||||
Class A Shares | ||||||||||||||||
2010 | 1.44% | 1.17% | 1.21% | 1.96% | ||||||||||||
2010(2) | 1.32% | N/A | N/A | N/A | ||||||||||||
2010(3) | N/A | 1.17% | 1.21% | N/A | ||||||||||||
2009(4) | 2.19% | N/A | N/A | N/A | ||||||||||||
2009(5) | N/A | 1.27% | 1.02% | N/A | ||||||||||||
Class C Shares | ||||||||||||||||
2010 | 2.12% | 1.90% | 2.00% | 2.69% | ||||||||||||
2010(2) | 2.09% | N/A | N/A | N/A | ||||||||||||
2010(3) | N/A | 1.91% | 1.96% | N/A | ||||||||||||
2009(4) | 2.90% | N/A | N/A | N/A | ||||||||||||
2009(5) | N/A | 2.00% | 2.13% | N/A | ||||||||||||
Class D Shares | ||||||||||||||||
2010 | 1.09% | 0.93% | 1.01% | 1.87% | ||||||||||||
2010(6) | 1.16% | 0.93% | 0.98% | N/A | ||||||||||||
Class I Shares | ||||||||||||||||
2010 | 0.96% | 0.86% | 0.90% | 1.73% | ||||||||||||
2010(2) | 1.08% | N/A | N/A | N/A | ||||||||||||
2010(3) | N/A | 0.83% | 0.85% | N/A | ||||||||||||
2009(4) | 2.15% | N/A | N/A | N/A | ||||||||||||
2009(5) | N/A | 0.81% | 0.77% | N/A | ||||||||||||
Class L Shares | ||||||||||||||||
2010 | N/A | 1.03% | 1.08% | N/A | ||||||||||||
2010(3) | N/A | 1.02% | 1.08% | N/A | ||||||||||||
2009 | N/A | 1.13% | 1.10% | N/A | ||||||||||||
2008 | N/A | 1.04% | 1.02% | N/A | ||||||||||||
2007 | N/A | 0.81% | 0.97% | N/A | ||||||||||||
2006 | N/A | 0.89% | 1.00% | N/A | ||||||||||||
2005 | N/A | 0.88% | 0.96% | N/A | ||||||||||||
Class R Shares | ||||||||||||||||
2010 | N/A | 1.53% | 1.60% | N/A | ||||||||||||
2010(3) | N/A | 1.52% | 1.57% | N/A | ||||||||||||
2009(5) | N/A | 1.53% | 1.54% | N/A | ||||||||||||
Class S Shares | ||||||||||||||||
2010 | 1.45% | 1.28% | 1.35% | 2.20% | ||||||||||||
2010(2) | 1.65% | N/A | N/A | N/A | ||||||||||||
2010(3) | N/A | 1.27% | 1.32% | N/A | ||||||||||||
2009(4) | 2.32% | N/A | N/A | N/A | ||||||||||||
2009(5) | N/A | 1.28% | 1.29% | N/A | ||||||||||||
Class T Shares | ||||||||||||||||
2010 | 1.19% | 1.03% | 1.10% | 1.96% | ||||||||||||
2010(2) | 1.29% | N/A | N/A | N/A | ||||||||||||
2010(3) | N/A | 1.03% | 1.08% | N/A | ||||||||||||
2009(7) | 4.70% | N/A | N/A | N/A | ||||||||||||
2009(8) | N/A | 1.11% | 1.11% | N/A | ||||||||||||
2008 | N/A | 1.07% | 1.03% | N/A | ||||||||||||
2007 | N/A | 0.86% | 1.01% | N/A | ||||||||||||
2006 | N/A | 0.93% | 1.01% | N/A | ||||||||||||
2005 | N/A | 0.93% | 0.97% | N/A | ||||||||||||
(1) | Period from July 30, 2010 (inception date) through December 31, 2010. | |
(2) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(3) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(4) | Period from December 31, 2008 (inception date) through July 31, 2009. | |
(5) | Period from July 6, 2009 (inception date) through October 31, 2009. | |
(6) | Period from February 16, 2010 (inception date) through June 30, 2010. | |
(7) | Period from July 6, 2009 (inception date) through July 31, 2009. | |
(8) | Period from November 1, 2008 through October 31, 2009. |
98 | DECEMBER 31, 2010
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7. | Capital Share Transactions |
For the six-month period ended December | ||||||||||||||||||||||||||||||||||||||||||
31, 2010 (unaudited), the eight- or eleven-month | ||||||||||||||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and the fiscal year | Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | ||||||||||||||||||||||||||||||||||||||
or period ended October 31, 2009 or July 31, 2009 | Value Fund | Value Fund | Value Fund | Income Fund | ||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010(5) | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class A Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 16 | 140 | 67 | 10,429 | 18,745 | 8,635 | 5,653 | 3,466 | 575 | 370 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | N/A | N/A | N/A | 37,761 | N/A | N/A | 538 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 2 | 1 | – | 296 | 47 | – | 184 | – | – | 5 | ||||||||||||||||||||||||||||||||
Shares repurchased | (99) | (62) | (3) | (8,660) | (7,584) | (4,492) | (1,413) | (364) | (85) | – | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | (81) | 79 | 64 | 2,065 | 11,208 | 41,904 | 4,424 | 3,102 | 1,028 | 375 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 143 | 64 | – | 53,112 | 41,904 | – | 4,130 | 1,028 | – | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 62 | 143 | 64 | 55,177 | 53,112 | 41,904 | 8,554 | 4,130 | 1,028 | 375 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class C Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 45 | 80 | 50 | 1,589 | 3,257 | 1,597 | 165 | 1,024 | 214 | 338 | ||||||||||||||||||||||||||||||||
Shares issued in connection with acquisition (Note 10) | N/A | N/A | N/A | N/A | N/A | 5,297 | N/A | N/A | 111 | |||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 3 | – | – | 1 | – | – | 24 | – | – | 3 | ||||||||||||||||||||||||||||||||
Shares repurchased | (12) | (14) | – | (921) | (885) | (385) | (221) | (53) | (6) | – | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 36 | 66 | 50 | 669 | 2,372 | 6,509 | (32) | 971 | 319 | 341 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 116 | 50 | – | 8,881 | 6,509 | – | 1,290 | 319 | – | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 152 | 116 | 50 | 9,550 | 8,881 | 6,509 | 1,258 | 1,290 | 319 | 341 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class D Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 176 | 237(6) | N/A | 1,744 | 1,724(6) | N/A | 173 | 1,196(6) | N/A | 663 | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 9) | N/A | N/A | N/A | N/A | 42,480(6) | N/A | N/A | 2,830(6) | N/A | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 10 | –(6) | N/A | 316 | –(6) | N/A | 101 | –(6) | N/A | 7 | ||||||||||||||||||||||||||||||||
Shares repurchased | (40) | (26)(6) | N/A | (3,133) | (2,430)(6) | N/A | (430) | (287)(6) | N/A | (9) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 146 | 211(6) | N/A | (1,073) | 41,774(6) | N/A | (156) | 3,739(6) | N/A | 661 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 211 | – | N/A | 41,774 | – | N/A | 3,739 | – | N/A | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 357 | 211 | N/A | 40,701 | 41,774 | N/A | 3,583 | 3,739 | N/A | 661 |
Janus Value Funds | 99
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Notes to Financial Statements (unaudited) (continued)
For the six-month period ended December | ||||||||||||||||||||||||||||||||||||||||||
31, 2010 (unaudited), the eight- or eleven-month | ||||||||||||||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and the fiscal year | Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | ||||||||||||||||||||||||||||||||||||||
or period ended October 31, 2009 or July 31, 2009 | Value Fund | Value Fund | Value Fund | Income Fund | ||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010(5) | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class I Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 925 | 3,652 | 2,866 | 27,854 | 62,067 | 18,921 | 30,559 | 18,819 | 11,739 | 505 | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 10) | N/A | N/A | N/A | N/A | N/A | 52,515 | N/A | N/A | 497 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 204 | 21 | 9 | 928 | 169 | – | 945 | – | – | 7 | ||||||||||||||||||||||||||||||||
Shares repurchased | (278) | (286) | (284) | (16,483) | (13,034) | (4,080) | (4,580) | (5,570) | (105) | – | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 851 | 3,387 | 2,591 | 12,299 | 49,202 | 67,356 | 26,924 | 13,249 | 12,131 | 512 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 5,978 | 2,591 | – | 116,558 | 67,356 | – | 25,380 | 12,131 | – | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 6,829 | 5,978 | 2,591 | 128,857 | 116,558 | 67,356 | 52,304 | 25,380 | 12,131 | 512 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class L Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | N/A | N/A | N/A | 270 | 2,515 | 6,973 | 1,274 | 2,971 | 14,737 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | N/A | N/A | N/A | (491) | 51 | 1,280 | 544 | – | 4,056 | N/A | ||||||||||||||||||||||||||||||||
Shares repurchased | N/A | N/A | N/A | 23 | (17,967) | (11,441) | (19,670) | (7,823) | (13,839) | N/A | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | N/A | N/A | N/A | (198) | (15,401) | (3,188) | (17,852) | (4,852) | 4,954 | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | N/A | N/A | N/A | 3,226 | 18,627 | 21,815 | 30,998 | 35,850 | 30,896 | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | N/A | N/A | N/A | 3,028 | 3,226 | 18,627 | 13,146 | 30,998 | 35,850 | N/A | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class R Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | N/A | N/A | N/A | 2,059 | 2,573 | 1,181 | 793 | 931 | 39 | N/A | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 10) | N/A | N/A | N/A | N/A | N/A | 2,983 | N/A | N/A | 171 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | N/A | N/A | N/A | 22 | – | – | 26 | – | – | N/A | ||||||||||||||||||||||||||||||||
Shares repurchased | N/A | N/A | N/A | (862) | (921) | (344) | (646) | (93) | (18) | N/A | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | N/A | N/A | N/A | 1,219 | 1,652 | 3,820 | 173 | 838 | 192 | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | N/A | N/A | N/A | 5,472 | 3,820 | – | 1,030 | 192 | – | N/A | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | N/A | N/A | N/A | 6,691 | 5,472 | 3,820 | 1,203 | 1,030 | 192 | N/A |
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For the six-month period ended December | ||||||||||||||||||||||||||||||||||||||||||
31, 2010 (unaudited), the eight- or eleven-month | ||||||||||||||||||||||||||||||||||||||||||
fiscal period ended June 30, 2010 and the fiscal year | Perkins Large Cap | Perkins Mid Cap | Perkins Small Cap | Perkins Value Plus | ||||||||||||||||||||||||||||||||||||||
or period ended October 31, 2009 or July 31, 2009 | Value Fund | Value Fund | Value Fund | Income Fund | ||||||||||||||||||||||||||||||||||||||
(all numbers in thousands) | 2010 | 2010(1) | 2009(2) | 2010 | 2010(3) | 2009(4) | 2010 | 2010(3) | 2009(4) | 2010(5) | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class S Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | – | – | 50 | 8,764 | 13,718 | 6,098 | 1,529 | 1,812 | 332 | 334 | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 10) | N/A | N/A | N/A | N/A | N/A | 19,652 | N/A | – | 1,177 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 2 | – | – | 188 | 25 | – | 100 | – | – | 4 | ||||||||||||||||||||||||||||||||
Shares repurchased | – | – | – | (4,683) | (7,094) | (2,455) | (439) | (704) | (153) | – | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 2 | – | 50 | 4,269 | 6,649 | 23,295 | 1,190 | 1,108 | 1,356 | 338 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 50 | 50 | – | 29,944 | 23,295 | – | 2,464 | 1,356 | – | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 52 | 50 | 50 | 34,213 | 29,944 | 23,295 | 3,654 | 2,464 | 1,356 | 338 | ||||||||||||||||||||||||||||||||
Transactions in Fund Shares – Class T Shares: | ||||||||||||||||||||||||||||||||||||||||||
Shares sold | 61 | 52 | 98* | 40,928 | 79,480 | 182,232 | 11,712 | 30,496 | 18,146 | 361 | ||||||||||||||||||||||||||||||||
Shares reorganized in connection with restructuring (Note 9) | N/A | N/A | N/A | N/A | (42,480) | N/A | N/A | (2,830) | N/A | N/A | ||||||||||||||||||||||||||||||||
Shares issued in connection with restructuring (Note 10) | N/A | N/A | N/A | N/A | N/A | N/A | N/A | N/A | 139 | N/A | ||||||||||||||||||||||||||||||||
Reinvested dividends and distributions | 2 | – | – | 2,351 | 685 | 21,752 | 1,506 | – | 3,565 | 5 | ||||||||||||||||||||||||||||||||
Shares repurchased | (13) | (1) | – | (60,008) | (71,403) | (122,827) | (7,694) | (13,206) | (15,988) | (4) | ||||||||||||||||||||||||||||||||
Net Increase/(Decrease) in Fund Shares | 50 | 51 | 98* | (16,729) | (33,718) | 81,157 | 5,524 | 14,460 | 5,862 | 362 | ||||||||||||||||||||||||||||||||
Shares Outstanding, Beginning of Period | 51 | – | – | 358,421 | 392,139 | 310,982 | 48,309 | 33,849 | 27,987 | – | ||||||||||||||||||||||||||||||||
Shares Outstanding, End of Period | 101 | 51 | 98* | 341,692 | 358,421 | 392,139 | 53,833 | 48,309 | 33,849 | 362 |
* | Shares are not in thousands. | |
(1) | Period from August 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from July 31 to June 30. | |
(2) | Period from December 31, 2008 (inception date) through July 31, 2009 for Class A Shares, Class C Shares, Class I Shares and Class S Shares and July 6, 2009 (inception date) through July 31, 2009 for Class T Shares. | |
(3) | Period from November 1, 2009 through June 30, 2010. The Fund changed its fiscal year end from October 31 to June 30. | |
(4) | Period from July 6, 2009 (inception date) through October 31, 2009 for Class A Shares, Class C Shares, Class I Shares, Class R Shares and Class S Shares and November 1, 2008 through October 31, 2009 for Class L Shares and Class T Shares. | |
(5) | Period from July 30, 2010 (inception date) through December 31, 2010. | |
(6) | Transactions in Fund Shares for Class D Shares are for the period from February 16, 2010 (inception date) to June 30, 2010. |
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Notes to Financial Statements (unaudited) (continued)
8. | Purchases and Sales of Investment Securities |
For the period ended December 31, 2010, the aggregate cost of purchases and proceeds from sales of investment securities (excluding short-term securities and short-term options contracts) was as follows:
Purchases of Long- | Proceeds from Sales | |||||||||||||
Purchases of | Proceeds from Sales | Term U.S. Government | of Long-Term U.S. | |||||||||||
Fund | Securities | of Securities | Obligations | Government Obligations | ||||||||||
Perkins Large Cap Value Fund | $ | 29,868,636 | $ | 17,021,096 | $ | – | $ | – | ||||||
Perkins Mid Cap Value Fund | 4,182,111,121 | 4,297,955,505 | – | – | ||||||||||
Perkins Small Cap Value Fund | 854,352,516 | 703,996,092 | – | – | ||||||||||
Perkins Value Plus Income Fund | 29,661,620 | 6,198,702 | 2,713,859 | 2,336,832 | ||||||||||
9. | Shares Issued in Connection with Restructuring |
Effective February 16, 2010, Class J Shares were renamed Class T Shares and are available through certain financial intermediary platforms. In addition, Class J Shares held directly with Janus were moved to newly created Class D Shares, a share class dedicated to shareholders investing directly with Janus. Class D Shares commenced operations on February 16, 2010. The shares issued in connection with the restructuring from Class J Shares to Class D Shares are reflected on the Statements of Changes in Net Assets and in the Capital Share Transactions table in Note 7.
10. | Fund Acquisition |
On July 6, 2009, Perkins Mid Cap Value Fund and Perkins Small Cap Value Fund acquired all of the net assets of Janus Adviser Perkins Mid Cap Value Fund and Janus Adviser Perkins Small Company Value Fund, respectively, pursuant to separate plans of reorganization approved by the Trustees of the Trust. The reorganization involved certain funds that were a series of the Janus Adviser Series trust (“JAD Trust”) being merged into corresponding funds of the Trust. The reorganization was accomplished by a tax-free exchange of the series of the JAD Trust for the series of the Trust. The table below reflects the merger activity.
Target Fund’s | ||||||||||||||||||||||||
Target Fund’s | Acquiring | Acquiring | Unrealized | |||||||||||||||||||||
Shares | Target Fund’s | Fund’s Shares | Fund’s Net | Combined Net | Appreciation/ | |||||||||||||||||||
Outstanding | Net Assets Prior | Issued in | Assets Prior to | Assets after | (Depreciation) | |||||||||||||||||||
Fund | Prior to Merger | to Merger | Merger | Merger | Merger | Prior to Merger | ||||||||||||||||||
Perkins Mid Cap Value Fund | 138,163,103 | $ | 1,899,985,868 | 118,208,457 | $ | 6,489,618,981 | $ | 8,389,604,849 | $ | (68,465,211 | ) | |||||||||||||
Perkins Small Cap Value Fund | 4,271,025 | 43,398,734 | 2,495,253 | 1,097,606,566 | 1,141,005,300 | 5,523,182 | ||||||||||||||||||
11. | Pending Legal Matters |
In the fall of 2003, the Securities and Exchange Commission (“SEC”), the Office of the New York State Attorney General (“NYAG”), the Colorado Attorney General (“COAG”), and the Colorado Division of Securities (“CDS”) announced that they were investigating alleged frequent trading practices in the mutual fund industry. On August 18, 2004, Janus Capital announced that it had reached final settlements with the SEC, the NYAG, the COAG, and the CDS related to such regulators’ investigations into Janus Capital’s frequent trading arrangements.
A number of civil lawsuits were brought in several state and federal jurisdictions against Janus Capital and certain of its affiliates, the Janus funds, and related entities and individuals based on allegations similar to those announced by the above regulators. Such lawsuits alleged a variety of theories for recovery including, but not limited to, the federal securities laws, other federal statutes (including ERISA), and various common law doctrines. The Judicial Panel on Multidistrict Litigation transferred these actions to the U.S. District Court for the District of Maryland (the “Court”) for coordinated proceedings. On September 29, 2004, five consolidated amended complaints were filed with the Court, two of which still remain: (i) claims by a putative class of shareholders of Janus Capital Group Inc. (“JCGI”) asserting claims on behalf of the shareholders against JCGI and Janus Capital (First Derivative Traders et al. v. Janus Capital Group Inc. et al., U.S. District Court, District of Maryland, MDL 1586, formerly referred to as Wiggins, et al. v. Janus Capital Group, Inc., et al., U.S. District Court, District of Maryland, Case No. 04-CV-00818); and (ii) derivative claims by investors in certain Janus funds ostensibly on
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behalf of such funds (Steinberg et al. v. Janus Capital Management, LLC et al., U.S. District Court, District of Maryland, Case No. 04-CV-00518).
In the First Derivative Traders case (action (i) above), a Motion to Dismiss was previously granted and the matter was dismissed in May 2007. Plaintiffs appealed that dismissal to the United States Court of Appeals for the Fourth Circuit (“Fourth Circuit”). In May 2009, the Fourth Circuit reversed the order of dismissal and remanded the case back to the trial court for further proceedings. In June 2010, the United States Supreme Court agreed to review the Fourth Circuit’s decision. As a result of these developments at the Supreme Court, the trial court has stayed all further proceedings until the Supreme Court rules on the matter. In the Steinberg case (action (ii) above), the trial court entered an order on January 20, 2010, granting Janus Capital’s Motion for Summary Judgment and dismissing the remaining claims asserted against the company. However, in February 2010, Plaintiffs appealed the trial court’s decision with the Fourth Circuit.
Additional lawsuits may be filed against certain of the Janus funds, Janus Capital, and related parties in the future. Janus Capital does not currently believe that these pending actions will materially affect its ability to continue providing services it has agreed to provide to the Janus funds.
12. | New Accounting Pronouncements |
In January 2010, the FASB issued Accounting Standards Update, “Improving Disclosures About Fair Value Measurements.” The Accounting Standards Update requires disclosures about purchases, sales, issuances, and settlements on a gross basis relating to Level 3 measurements. This disclosure will become effective for fiscal years beginning after December 15, 2010, and for interim periods within those fiscal years. Management is currently evaluating the impact the adoption of this Accounting Standards Update will have on the Funds’ financial statement disclosures.
13. | Subsequent Event |
Management has evaluated whether any events or transactions occurred subsequent to December 31, 2010 and through the date of issuance of the Funds’ financial statements and determined that there were no material events or transactions that would require recognition or disclosure in the Funds’ financial statements.
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Additional Information (unaudited)
Proxy Voting Policies and Voting Record
A description of the policies and procedures that the Funds use to determine how to vote proxies relating to their portfolio securities is available without charge: (i) upon request, by calling 1-800-525-0020 (toll free); (ii) on the Funds’ website at janus.com/proxyvoting; and (iii) on the SEC’s website at http://www.sec.gov. Additionally, information regarding each Fund’s proxy voting record for the most recent twelve-month period ended June 30 is also available, free of charge, through janus.com/proxyvoting and from the SEC’s website at http://www.sec.gov.
Quarterly Portfolio Holdings
The Funds file their complete portfolio holdings (schedule of investments) with the SEC for the first and third quarters of each fiscal year on Form N-Q within 60 days of the end of such fiscal quarter. The Funds’ Form N-Q: (i) is available on the SEC’s website at http://www.sec.gov; (ii) may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. (information on the Public Reference Room may be obtained by calling 1-800-SEC-0330); and (iii) is available without charge, upon request, by calling Janus at 1-800-525-0020 (toll free).
Approval of Advisory Agreements During the Period
The Trustees of Janus Investment Fund, none of whom has ever been affiliated with Janus Capital (“Independent Trustees”), oversee the management of each Fund and, as required by law, determine annually whether to continue the investment advisory agreement for each Fund and the subadvisory agreements for the nine Funds that utilize subadvisers.
In connection with their most recent consideration of those agreements for each Fund, the Trustees received and reviewed a substantial amount of information provided by Janus Capital and the respective subadvisers in response to requests of the Independent Trustees and their independent legal counsel. They also received and reviewed a considerable amount of information and analysis provided by their independent fee consultant. Throughout their consideration of the agreements, the Independent Trustees were advised by their independent legal counsel. The Independent Trustees met with management to consider the agreements, and also met separately in executive session with their independent legal counsel and their independent fee consultant.
At a meeting held on December 3, 2010, based on the Trustees’ evaluation of the information provided by Janus Capital, the subadvisers and the independent fee consultant, as well as other information, the Trustees determined that the overall arrangements between each Fund and Janus Capital and each subadviser, as applicable, were fair and reasonable in light of the nature, extent and quality of the services provided by Janus Capital, its affiliates and the subadvisers, the fees charged for those services, and other matters that the Trustees considered relevant in the exercise of their business judgment. At that meeting, the Trustees unanimously approved the continuation of the investment advisory agreement for each Fund, and the subadvisory agreement for each subadvised Fund, for the period from February 1, 2011 through February 1, 2012, subject to earlier termination as provided for in each agreement.
In considering the continuation of those agreements, the Trustees reviewed and analyzed various factors that they determined were relevant, including the factors described below, none of which by itself was considered dispositive. However, the material factors and conclusions that formed the basis for the Trustees’ determination to approve the continuation of the agreements are discussed separately below.
Nature, Extent and Quality of Services
The Trustees reviewed the nature, extent and quality of the services provided by Janus Capital and the subadvisers to the Funds, taking into account the investment objective and strategy of each Fund and the knowledge the Trustees gained from their regular meetings with management on at least a quarterly basis and their ongoing review of information related to the Funds. In addition, the Trustees reviewed the resources and key personnel of Janus Capital and each subadviser, particularly noting those employees who provide investment management services to the Funds. The Trustees also considered other services provided to the Funds by Janus Capital or the subadvisers, such as managing the execution of portfolio transactions and the selection of broker-dealers for those transactions, serving as the Funds’ administrator, monitoring adherence to the Funds’ investment restrictions, producing shareholder reports, providing support services for the Trustees and Trustee committees, communicating with shareholders and overseeing the activities of other service providers, including monitoring compliance with various policies and procedures of the Funds and with applicable securities laws and regulations.
The Trustees concluded that the nature, extent and quality of the services provided by Janus Capital or the subadviser to each Fund were appropriate and consistent with the terms of the respective advisory and subadvisory agreements, and that, taking into account steps taken to address those Funds whose performance lagged that of
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their peers for certain periods, the quality of those services had been consistent with or superior to quality norms in the industry and the Funds were likely to benefit from the continued provision of those services. They also concluded that Janus Capital and each subadviser had sufficient personnel, with the appropriate education and experience, to serve the Funds effectively and had demonstrated its continuing ability to attract well-qualified personnel.
Performance of the Funds
The Trustees considered the performance results of each Fund over various time periods. They reviewed information comparing each Fund’s performance with the performance of comparable funds and peer groups identified by Lipper, and with the Fund’s benchmark index. They concluded that the performance of many Funds was good to very good under current market conditions. Although the performance of some Funds lagged that of their peers for certain periods, the Trustees also concluded that Janus Capital had taken or was taking appropriate steps to address those instances of under-performance.
Costs of Services Provided
The Trustees examined information regarding the fees and expenses of each Fund in comparison to similar information for other comparable funds as provided by Lipper. They also reviewed an analysis of that information provided by their independent fee consultant and noted that the rate of management (investment advisory and administrative) fees for most of the Funds, after applicable contractual expense limitations, was below the mean management fee rate of the respective peer group of funds selected by Lipper.
The Trustees considered the methodology used by Janus Capital and each subadviser in determining compensation payable to portfolio managers, the competitive environment for investment management talent and the competitive market for mutual funds in different distribution channels. They concluded that the compensation methodology provided a good alignment of the interests of the portfolio managers with the interests of Fund shareholders.
The Trustees also reviewed management fees charged by Janus Capital to its separate account clients and to non-affiliated funds subadvised by Janus Capital (for which Janus Capital provides only portfolio management services). Although in most instances subadvisory and separate account fee rates for various investment strategies were lower than management fee rates for Funds having a similar strategy, the Trustees noted that, under the terms of the management agreements with the Funds, Janus Capital performs significant additional services for the Funds that it does not provide to those other clients, including administrative services, oversight of the Funds’ other service providers, trustee support, regulatory compliance and numerous other services, and that, in serving the Funds, Janus Capital assumes many legal risks that it does not assume in servicing its other clients. Moreover, they noted that the spread between the average fee rates charged to the Funds and the fee rates that Janus Capital charged to its separate account clients was significantly smaller than the average spread for such fee rates of other advisers, based on publicly available data and research conducted by the Trustees’ independent fee consultant.
The Trustees reviewed information on the profitability to Janus Capital and its affiliates of their relationships with each Fund, as well as an explanation of the methodology utilized in allocating various expenses of Janus Capital and its affiliates among the Funds and other clients. The Trustees also reviewed the financial statements and corporate structure of Janus Capital’s parent company. In their review, the Trustees considered whether Janus Capital and each subadviser receive adequate incentives to manage the Funds effectively. The Trustees recognized that profitability comparisons among fund managers are difficult because very little comparative information is publicly available and the profitability of any fund manager is affected by numerous factors, including the organizational structure of the particular fund manager, the types of funds and other accounts it manages, possible other lines of business, the methodology for allocating expenses and the fund manager’s capital structure and cost of capital. However, taking into account those factors and the analysis provided by the Trustees’ independent fee consultant, and based on the information available, the Trustees concluded that Janus Capital’s profitability with respect to each Fund in relation to the services rendered was not unreasonable.
The Trustees concluded that the management fees and other compensation payable by each Fund to Janus Capital and its affiliates, as well as the fees paid by Janus Capital to the subadvisers of subadvised Funds, were reasonable in relation to the nature, extent and quality of the services provided, taking into account the fees charged by other advisers for managing comparable mutual funds with similar strategies and the fees Janus Capital and the subadvisers charge to other clients. The Trustees also concluded that the overall expense ratio of each Fund was reasonable, taking into account the size of the Fund, the quality of services provided by Janus Capital and any subadviser, the investment performance of the Fund and any expense limitations agreed to by Janus Capital.
Economies of Scale
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Additional Information (unaudited) (continued)
The Trustees considered information about the potential for Janus Capital to realize economies of scale as the assets of the Funds increase. They noted that, although many Funds pay advisory fees at a fixed rate as a percentage of net assets, without any breakpoints, the actual management fee rate paid by each Fund, after any contractual expense limitations, was below the mean management fee rate of the Fund’s peer group identified by Lipper; and, for those Funds whose expenses are being reduced by the contractual expense limitations of Janus Capital, Janus Capital is subsidizing the Funds because they have not reached adequate scale. Moreover, as the assets of many of the Funds have declined in the past few years, the Funds have benefited from having advisory fee rates that have remained constant rather than increasing as assets declined. In addition, performance fee structures have been implemented for several Funds that have caused or will cause the effective rate of advisory fees payable by such a Fund to vary depending on the investment performance of the Fund relative to its benchmark index over the measurement period; and a few Funds have fee schedules with breakpoints and reduced fee rates above certain asset levels. The Trustees also noted that the Funds share directly in economies of scale through the lower charges of third-party service providers that are based in part on the combined scale of all of the Funds. Based on all of the information they reviewed, including research and analysis conduct by the Trustees’ Independent Fee Consultant, the Trustees concluded that the current fee structure of each Fund was reasonable and that the current rates of fees do reflect a sharing between Janus Capital and the Fund of economies of scale at the current asset level of the Fund.
Other Benefits to Janus Capital
The Trustees also considered benefits that accrue to Janus Capital and its affiliates from their relationships with the Funds. They recognized that two affiliates of Janus Capital separately serve the Funds as transfer agent and distributor, respectively, and the transfer agent receives compensation directly from the non-money market funds for services provided. The Trustees also considered Janus Capital’s past and proposed use of commissions paid by the Funds on their portfolio brokerage transactions to obtain proprietary and third-party research products and services benefiting the Fund and/or other clients of Janus Capital. The Trustees concluded that Janus Capital’s use of these types of client commission arrangements to obtain proprietary and third-party research products and services was consistent with regulatory requirements and guidelines and was likely to benefit each Fund. The Trustees also concluded that, other than the services provided by Janus Capital and its affiliates pursuant to the agreements and the fees to be paid by each Fund therefor, the Funds and Janus Capital may potentially benefit from their relationship with each other in other ways. They concluded that Janus Capital benefits from the receipt of research products and services acquired through commissions paid on portfolio transactions of the Funds and that the Funds benefit from Janus Capital’s receipt of those products and services as well as research products and services acquired through commissions paid by other clients of Janus Capital. They further concluded that success of any Fund could attract other business to Janus Capital or other Janus funds, and that the success of Janus Capital could enhance Janus Capital’s ability to serve the Funds.
After full consideration of the above factors, as well as other factors, the Trustees, each of whom is an Independent Trustee, concluded at their December 3, 2010 meeting that the proposed continuation of the investment advisory agreement and, if applicable, the subadvisory agreement for each Fund for another year was in the best interest of the respective Funds and their shareholders.
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Explanations of Charts, Tables and
Financial Statements (unaudited)
Financial Statements (unaudited)
1. | Performance Overviews |
Performance overview graphs compare the performance of a hypothetical $10,000 investment in each Fund (from inception) with one or more widely used market indices. The hypothetical example does not represent the returns of any particular investment.
When comparing the performance of a Fund with an index, keep in mind that market indices do not include brokerage commissions that would be incurred if you purchased the individual securities in the index. They also do not include taxes payable on dividends and interest or operating expenses incurred if you maintained a Fund invested in the index.
Average annual total returns are also quoted for each Fund. Average annual total return is calculated by taking the growth or decline in value of an investment over a period of time, including reinvestment of dividends and distributions, then calculating the annual compounded percentage rate that would have produced the same result had the rate of growth been constant throughout the period. Average annual total return does not reflect the deduction of taxes that a shareholder would pay on Fund distributions or redemptions of Fund shares.
Pursuant to federal securities rules, expense ratios shown in the performance chart reflect subsidized and unsubsidized ratios for the prior fiscal year. The total annual fund operating expenses ratio is gross of any fee waivers, reflecting a Fund’s unsubsidized expense ratio. The net annual fund operating expenses ratio (if applicable) includes contractual waivers of Janus Capital and/or Janus Services and reflects a Fund’s subsidized expense ratio. Both the total annual fund operating expenses ratio and net annual fund operating expenses ratio are based on average net assets as of the fiscal period ended June 30, 2010 for all Funds except Perkins Value Plus Income Fund, which are estimated for the fiscal year. The ratios also include expenses indirectly incurred by a Fund as a result of investing in other investment companies or pooled investments, which are not reflected in the “Financial Highlights” of this report. As a result, these ratios may be higher or lower than those shown in the “Financial Highlights” in this report. All expenses are shown without the effect of expense offset arrangements. Pursuant to such arrangements, credits realized as a result of uninvested cash balances are used to reduce custodian and transfer agent expenses.
2. | Schedules of Investments |
Following the performance overview section is each Fund’s Schedule of Investments. This schedule reports the industry concentrations and types of securities held in each Fund on the last day of the reporting period. Securities are usually listed by type (common stock, corporate bonds, U.S. Government obligations, etc.) and by industry classification (banking, communications, insurance, etc.). Holdings are subject to change without notice.
The value of each security is quoted as of the last day of the reporting period. The value of securities denominated in foreign currencies is converted into U.S. dollars.
If a Fund invests in foreign securities, it will also provide a summary of investments by country. This summary reports each Fund’s exposure to different countries by providing the percentage of securities invested in each country. The country of each security represents the country in which the company is incorporated. Each Fund’s Schedule of Investments relies upon the industry group and country classifications published by Bloomberg L.P.
2a. Forward Currency Contracts
A table listing forward currency contracts follows each Fund’s Schedule of Investments (if applicable). Forward currency contracts are agreements to deliver or receive a preset amount of currency at a future date. Forward currency contracts are used to hedge against foreign currency risk in the Funds’ long-term holdings.
The table provides the name of the foreign currency, the settlement date of the contract, the amount of the contract, the value of the currency in U.S. dollars and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the change in currency exchange rates from the time the contract was opened to the last day of the reporting period.
2b. Futures
A table listing futures contracts follows each Fund’s Schedule of Investments (if applicable). Futures contracts are contracts that obligate the buyer to receive and the seller to deliver an instrument or money at a specified price on a specified date. Futures are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, the principal amount, value and the amount of unrealized gain or loss. The amount of unrealized gain or loss reflects the marked-to-market amount for the last day of the reporting period.
2c. Options
A table listing written options contracts follows each Fund’s Schedule of Investments (if applicable). Written options contracts are contracts that obligate a Fund to sell or purchase an underlying security at a fixed price, upon
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Explanations of Charts, Tables and
Financial Statements (unaudited) (continued)
Financial Statements (unaudited) (continued)
exercise of the option. Options are used to hedge against adverse movements in securities prices, currency risk or interest rates.
The table provides the name of the contract, number of contracts held, the expiration date, exercise price, value and premiums received.
3. | Statements of Assets and Liabilities |
These statements are often referred to as the “balance sheets.” It lists the assets and liabilities of the Funds on the last day of the reporting period.
The Funds’ assets are calculated by adding the value of the securities owned, the receivable for securities sold but not yet settled, the receivable for dividends declared but not yet received on stocks owned and the receivable for Fund shares sold to investors but not yet settled. The Funds’ liabilities include payables for securities purchased but not yet settled, Fund shares redeemed but not yet paid and expenses owed but not yet paid. Additionally, there may be other assets and liabilities such as unrealized gain or loss on forward currency contracts.
The section entitled “Net Assets Consist of” breaks down the components of the Funds’ net assets. Because the Funds must distribute substantially all earnings, you will notice that a significant portion of net assets is shareholder capital.
The last section of this statement reports the net asset value (“NAV”) per share on the last day of the reporting period. The NAV is calculated by dividing the Funds’ net assets (assets minus liabilities) by the number of shares outstanding.
4. | Statements of Operations |
These statements detail the Funds’ income, expenses, gains and losses on securities and currency transactions, and appreciation or depreciation of current Fund holdings.
The first section in this statement, entitled “Investment Income,” reports the dividends earned from stocks and interest earned from interest-bearing securities in the Funds.
The next section reports the expenses incurred by the Funds, including the advisory fee paid to the investment adviser, transfer agent fees and expenses, and printing and postage for mailing statements, financial reports and prospectuses. Expense offsets and expense reimbursements, if any, are also shown.
The last section lists the increase or decrease in the value of securities held in the Funds. The Funds will realize a gain (or loss) when they sell their position in a particular security. An unrealized gain (or loss) refers to the change in net appreciation or depreciation of the Funds during the reporting period. “Net Realized and Unrealized Gain/(Loss) on Investments” is affected both by changes in the market value of Fund holdings and by gains (or losses) realized during the reporting period.
5. | Statements of Changes in Net Assets |
These statements report the increase or decrease in the Funds’ net assets during the reporting period. Changes in the Funds’ net assets are attributable to investment operations, dividends, distributions and capital share transactions. This is important to investors because it shows exactly what caused the Funds’ net asset size to change during the period.
The first section summarizes the information from the Statements of Operations regarding changes in net assets due to the Funds’ investment performance. The Funds’ net assets may also change as a result of dividend and capital gains distributions to investors. If investors receive their dividends in cash, money is taken out of the Funds to pay the distribution. If investors reinvest their dividends, the Funds’ net assets will not be affected. If you compare each Fund’s “Net Decrease from Dividends and Distributions” to the “Reinvested dividends and distributions,” you will notice that dividend distributions had little effect on each Fund’s net assets. This is because the majority of Janus investors reinvest their distributions.
The reinvestment of dividends is included under “Capital Share Transactions.” “Capital Shares” refers to the money investors contribute to the Funds through purchases or withdrawals via redemptions. The Funds’ net assets will increase and decrease in value as investors purchase and redeem shares from the Funds.
6. | Financial Highlights |
This schedule provides a per-share breakdown of the components that affect each Fund’s NAV for current and past reporting periods. Not only does this table provide you with total return, it also reports total distributions, asset size, expense ratios and portfolio turnover rate.
The first line in the table reflects the NAV per share at the beginning of the reporting period. The next line reports the net investment income per share, which comprises dividends and interest income earned on securities held by the Funds. Following is the total of gains/(losses), realized and unrealized. Dividends and distributions are then subtracted to arrive at the NAV per share at the end of the period. The next line reflects the average annual total return reported the last day of the period. The total return may include adjustments in accordance with
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generally accepted accounting principles. As a result, the total return may differ from the total return reflected for shareholder transactions.
Also included are the expense ratios, or the percentage of average net assets that were used to cover operating expenses during the period. Expense ratios vary across the Funds within the Trust for a number of reasons, including the differences in management fees, the frequency of dividend payments and the extent of foreign investments, which entail greater transaction costs.
The Funds’ expenses may be reduced through expense-reduction arrangements. These arrangements may include the use of balance credits or transfer agent fee offsets. The Statements of Operations reflect total expenses before any such offset, the amount of the offset and the net expenses. The expense ratios listed in the Financial Highlights reflect total expenses prior to any expense offset (gross expense ratio) and after the expense offsets (net expense ratio). Both expense ratios reflect expenses after waivers (reimbursements), if applicable.
The ratio of net investment income/(loss) summarizes the income earned less expenses, divided by the average net assets of a Fund during the reporting period. Don’t confuse this ratio with a Fund’s yield. The net investment income ratio is not a true measure of a Fund’s yield because it doesn’t take into account the dividends distributed to the Fund’s investors.
The next figure is the portfolio turnover rate, which measures the buying and selling activity in a Fund. Portfolio turnover is affected by market conditions, changes in the asset size of a Fund, the nature of the Fund’s investments and the investment style of the portfolio manager. A 100% rate implies that an amount equal to the value of the entire portfolio is turned over in a year; a 50% rate means that an amount equal to the value of half the portfolio is traded in a year; and a 200% rate means that an amount equal to the value of the portfolio is traded every six months.
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Janus provides access to a wide range of investment disciplines.
Alternative
Janus alternative funds seek to deliver strong risk-adjusted returns over a full market cycle with lower correlation to equity markets than traditional investments.
Asset Allocation
Janus’ asset allocation funds utilize our fundamental, bottom-up research to balance risk over the long term. From fund options that meet investors’ risk tolerance and objectives to a method that incorporates non-traditional investment choices to seek non-correlated sources of risk and return, Janus’ asset allocation funds aim to allocate risk more effectively.
Core
Janus core funds seek investments in more stable and predictable companies. These funds look for a strategic combination of steady growth and for certain funds, some degree of income.
Fixed Income
Janus fixed income funds attempt to provide less risk relative to equities while seeking to deliver a competitive total return through high current income and appreciation. Janus money market funds seek capital preservation and liquidity with current income as a secondary objective.
Global & International
Janus global and international funds seek to leverage Janus’ research capabilities by taking advantage of inefficiencies in foreign markets, where accurate information and analytical insight are often at a premium.
Growth
Janus growth funds focus on companies believed to be the leaders in their respective industries, with solid management teams, expanding market share, margins and efficiencies.
Risk Managed
Our risk-managed funds seek to outperform their respective indices while maintaining a risk profile equal to or lower than the index itself. Managed by INTECH (a Janus subsidiary), these funds use a mathematical process in an attempt to build a more “efficient” portfolio than the index.
Value
Janus value funds invest in companies they believe are poised for a turnaround or are trading at a significant discount to fair value. The goal is to gain unique insight into a company’s true value and identify and evaluate potential catalysts that may unlock shareholder value.
For more information about our funds, contact your investment professional or go to janus.com/advisor/mutual-funds (or janus.com/allfunds if you hold Shares directly with Janus).
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Please consider the charges, risks, expenses and investment objectives carefully before investing or recommending to clients for investment. For a prospectus or, if available, a summary prospectus containing this and other information, please call Janus at 877.33JANUS (52687) (or 800.525.3713 if you hold Shares directly with Janus); or download the file from janus.com/info (or janus.com/reports if you hold Shares directly with Janus). Read it carefully before you invest or send money.
Janus Distributors LLC 151 Detroit Street, Denver, CO 80206 (02/11)
Investment products offered are: NOT FDIC-INSURED MAY LOSE VALUE NO BANK GUARANTEE
C-0111-226 | 125-24-93007 02-11 |
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Item 2 — Code of Ethics
Not applicable to semiannual reports.
Item 3 — Audit Committee Financial Expert
Not applicable to semiannual reports.
Item 4 — Principal Accountant Fees and Services
Not applicable to semiannual reports.
Item 5 — Audit Committee of Listed Registrants
Not applicable.
Item 6 — Investments
(a) | Please see Schedule of Investments contained in the Reports to Shareholders included under Item 1 of this Form N-CSR. |
(b) | Using credible information that is available to the public, the Funds have not divested from any securities of any issuers that conduct or have direct investments in certain business operations in Sudan or Iran in accordance with Section 13(c) of the Investment Company Act of 1940. |
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Item 7 — Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
Not applicable.
Item 8 — Portfolio Managers of Closed-End Management Investment Companies
Not applicable.
Item 9 — Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers
Not applicable.
Item 10 — Submission of Matters to a Vote of Security Holders
There have been no material changes to the procedures by which shareholders may recommend nominees to the Registrant’s Board of Trustees.
Item 11 — Controls and Procedures
(a) | The Registrant’s Principal Executive Officer and Principal Financial Officer have evaluated the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended) within 90 days of this filing and have concluded that the Registrant’s disclosure controls and procedures were effective, as of that date. | ||
(b) | There have been no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940, as amended) that occurred during the Registrant’s second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
Item 12 — Exhibits
(a)(1) | Not applicable because the Registrant has posted its Code of Ethics (as defined in Item 2(b) of Form N-CSR) on its website pursuant to paragraph (f)(2) of Item 2 of Form N-CSR. | ||
(a)(2) | Separate certifications for the Registrant’s Principal Executive Officer and Principal Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, as amended, are attached as Ex99.CERT. | ||
(a)(3) | Not applicable to open-end companies. |
(b) | A certification for the Registrant’s Principal Executive Officer and Principal Financial Officer, as required by Rule 30a-2(b) under the Investment Company Act of 1940, as amended, is attached as Ex99.906CERT. The certification furnished pursuant to this paragraph is not deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that section. Such certification is not deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the Registrant specifically incorporates it by reference. |
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Janus Investment Fund | ||||
By: | /s/ Robin C. Beery | |||
President and Chief Executive Officer of Janus Investment Fund | ||||
(Principal Executive Officer) | ||||
Date: | February 28, 2011 |
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940, as amended, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
By: | /s/ Robin C. Beery | |||
President and Chief Executive Officer of Janus Investment Fund | ||||
(Principal Executive Officer) | ||||
Date: | February 28, 2011 | |||
By: | /s/ Jesper Nergaard | |||
Vice President, Chief Financial Officer, Treasurer and Principal Accounting Officer of Janus Investment Fund (Principal Accounting Officer and Principal Financial Officer) | ||||
Date: | February 28, 2011 |