[Janus letterhead]
February 17, 2010
VIA EDGAR
Mr. Larry Greene
Division of Investment Management
U.S. Securities and Exchange Commission
100 F Street, N.E.
Washington, DC 20549-0505
Re: JANUS INVESTMENT FUND (the "Registrant")
1933 Act File No. 002-34393
1940 Act File No. 811-01879
Post-Effective Amendment No. 127
Dear Mr. Greene:
On behalf of the Registrant and its funds or portfolios (each, a "Fund" and
collectively, the "Funds"), this letter is to respond to your comments made by
telephone on January 21, 2010 with respect to the Registrant's Post-Effective
Amendment No. 127 filed pursuant to Rule 485(a) under the Securities Act of
1933, as amended, on November 24, 2009. The Staff of the Securities and Exchange
Commission's (the "Staff") comments and the Registrant's responses to Staff
comments are as follows:
1. COMMENT: The Staff requested that the Registrant reflect in writing
all comments and responses and carry over comments, as applicable, to
the Registrant's other Prospectuses and Statements of Additional
Information ("SAIs").
RESPONSE: The Registrant acknowledges the comment and confirms that it
has complied.
Prospectus Comments
2. COMMENT: With respect to the Funds, the Staff noted that for Funds
with global, international or worldwide in their names, such Funds
should each invest in securities of at least ten countries and invest
at least 40% of their respective assets in securities of foreign
countries, excluding the U.S.
RESPONSE: Consistent with investment policies and restrictions of
these Funds, the Registrant has previously added or revised disclosure
as appropriate to reflect that such Funds invest in several countries.
The Registrant believes these investment policies are consistent with
formal SEC guidance.
3. COMMENT: Where a Fund has an expense reimbursement or fee waiver
arrangement that reduces Fund Operating Expenses, the Staff requested
that Registrant amend its Fees and Expenses tables to include the
caption "Net Total Operating Expenses" below the "Fee Waiver" caption
showing the Fund's operating expenses waived. The Staff indicated that
a Fund should not use the caption "Total Operating Expenses" twice in
the Fees and Expenses table.
RESPONSE: The Registrant acknowledges the comment and has updated the
disclosure as requested. However, the Registrant notes that
Instruction 3(e) to Item 3 of Form N-1A states that a Fund should use
appropriate descriptive captions, such as "Fee Waiver [and/or Expense
Reimbursement]" and "Total Annual Fund Operating Expenses After Fee
Waiver [and/or Expense Reimbursement]" when it has expense
reimbursement or fee waiver arrangements that will reduce any Fund
operating expenses. The Registrant believes that its use of "Total
Operating Expenses After Fee Waiver" complied with Form N-1A
instructions.
4. COMMENT: With regards to the Fees and Expenses table in the Summary
Section of the Prospectus, the Staff indicated that a footnote to the
table pertaining to a Fund's performance adjusted management fee is
not permitted under Form N-1A. The Staff suggested that the Registrant
note in parentheses next to "Management Fee" in the table that the
management fee is subject to a performance fee.
RESPONSE: The Registrant has updated its Fees and Expenses table to
include the phrase "may adjust up or down" in parentheses next to
"Management Fee" in the table. The footnote explaining the Fund's
performance fee has been deleted. While the Registrant has amended its
Fees and Expenses table per the Staff's request, the Registrant
strongly believes that a footnote explaining the Fund's use of
performance-based management fees is appropriate and should be
permitted given the unique nature of these types of fees.
5. COMMENT: The Staff indicated that the narrative before the Fees and
Expenses Example should be amended to delete the sentence "It also
shows costs if you sold your Shares at the end of the period or
continued to hold them." The Staff noted that Item 3 of Form N-1A does
not allow this disclosure.
RESPONSE: The Registrant acknowledges the comment and has updated the
disclosure as appropriate.
6. COMMENT: The Staff indicated that the table in the Fees and Expenses
Example should contain two separate tables that provide expense
examples if shares were held and sold. The Staff requested that the
Registrant follow the example provided in Item 3 of Form N-1A.
RESPONSE: The Registrant acknowledges the comment and has updated the
disclosure as appropriate.
7. COMMENT: With regards to the Annual Total Return table in the Summary
Section of the Prospectus, the Staff requested that the Registrant
confirm that footnotes regarding a contingent deferred sales charge,
"Return After Taxes on Distributions and Sale of Fund Shares," and
"Before Tax Returns" are permitted as disclosed under Form N-1A. In
addition, the Staff noted that a description of a broad-based index
used in the table is not permitted under Form N-1A and further
requested that Registrant confirm such description is permissible
under Form N-1A.
RESPONSE: The Registrant believes that the disclosures relating to a
contingent deferred sales charge, "Return After Taxes on Distributions
and Sale of Fund Shares," and "Before Tax Returns" are permitted under
Item 4(b)(2)(iv) of Form N-1A. The Registrant acknowledges the Staff's
comment regarding index descriptions and has updated the disclosure as
appropriate.
8. COMMENT: With regards to "Purchase and Sale of Fund Shares" in the
Summary Section of the Prospectus, the Staff indicated that references
to financial intermediary transaction processing fees and requests
received in "good order" are not permitted by Item 6 of Form N-1A. The
Staff stated that only disclosure about a Fund's minimum initial or
subsequent investment requirements and procedures for redeeming shares
is permitted under Form N-1A.
RESPONSE: The Registrant acknowledges the Staff's comments and has
deleted references to financial intermediary transaction processing
fees. However, the Registrant strongly believes that the Fund's
description of the receipt of purchase, exchange and redemption
request in "good order" from financial intermediaries is allowed under
Item 6 of Form N-1A. Item 6 states that the Fund should describe
investment requirements and redemption procedures. A purchase,
exchange or redemption request cannot be processed by the Fund unless
a financial intermediary delivers a request in "good order" and
complies with this procedure. The Registrant believes that this
disclosure complies with the instructions in Form N-1A and has
retained its disclosure.
9. COMMENT: With respect to Janus Global Life Sciences Fund's strategy to
normally invest up to 80% of its assets in securities of companies
that have life sciences orientation, the Staff asked whether or not
80% could be invested in derivatives, and if so, requested that the
Registrant make that point clear to investors.
RESPONSE: The Fund has the ability, but not the intention, to normally
invest up to 80% of its assets in derivatives. The Fund does not
generally invest in derivatives, although they are not precluded from
doing so. If this changes, the Fund's Risk/Return Summary disclosure
would be updated to include additional disclosure regarding investment
in derivatives.
10. COMMENT: In regards to Janus Global Life Sciences Fund, the Staff
asked whether the Fund has a concentration policy.
RESPONSE: The Fund does not have a concentration policy. The Fund may
focus its investment in "life sciences" related industry groups, but
does not concentrate in one particular industry or industry group.
11. COMMENT: In each Prospectus under the section titled "Short Sales,"
the Registrant indicates that short positions through derivative
instruments such as options are exposed to the same risks as short
sales. The Staff requested that the Registrant confirm that the
derivative instruments referenced in the prospectus complies with the
asset segregation or "cover" rules described in Investment Company Act
Release No. 10666 (April 18, 1979).
RESPONSE: The Registrant confirms that, to the best of its knowledge,
the Fund has complied with asset segregation or "cover" rules with
regards to its derivative instruments.
12. COMMENT: The Staff asked for clarification regarding the management of
Janus Global Research Fund and whether disclosure as it relates to
Item 5 of Form N-1A is appropriate.
RESPONSE: Director of Research, James Goff oversees the team of equity
research analysts that select investments for consideration by Mr.
Goff and the Fund. Mr. Goff is responsible for the
day-to-day operations of the Fund. The Registrant believes that the
disclosure in the Management section of the Fund's Prospectus is
consistent with Item 5 of Form N-1A.
13. COMMENT: With regards to the Janus Smart Portfolios, the Staff
requested that each Fund indicate in its respective Summary Section of
the Prospectus that it operates as a "fund of funds."
RESPONSE: The Registrant acknowledges the comment and has updated the
disclosure as appropriate.
14. COMMENT: With regards to the Janus High Yield Fund, the Staff asked
for clarification regarding the reference to "other high yielding
securities" in the Fund's Principal Investment Strategies section of
the Prospectus.
RESPONSE: The Registrant responds by noting that the Fund has included
the phrase "other high-yielding securities" to include the variety of
instruments that may have high yield exposure such as derivative
contracts, which may not be rated by a National Recognized Statistical
Rating Organization.
15. COMMENT: With respect to Janus Short-Term Bond Fund, the Staff asked
how the policy of investing in intermediate-term fixed-income
securities is consistent with the Fund's name.
RESPONSE: The adopting release for Rule 35d-1 (the Fund Names Rule)
notes that the Division of Investment Management has required funds
with "short-term" in their names to maintain a dollar-weighted average
maturity of no more than three years. Although this Fund may invest to
some extent in intermediate-term fixed income securities, consistent
with the Division's policy, the Fund's policy disclosed in the
Prospectus is to maintain an average-weighted effective maturity of
three years or less under normal circumstances.
SAI Comments
16. COMMENT: In the section titled "Investment Policies and Restrictions
Applicable to All Funds," with respect to Janus Global Life Sciences
Fund, the policies state that Janus Global Life Sciences Fund "may
invest 25% or more of its total assets, in aggregate, in the following
industry groups: health care, pharmaceuticals, agriculture,
cosmetics/personal care, and biotechnology." The Staff indicated that
the word "may" ought to be replaced with "will."
RESPONSE: The Registrant acknowledges the comment and has updated the
disclosure to include the phrase "will normally." The Fund does not
have a 1940 Act concentration policy but has a fundamental policy that
it "will normally" invest in the industry groups referenced above.
17. COMMENT: With respect to the "Investment Company Securities" section
of the SAI, the Staff asked if the Registrant's reference to "other
index-based investments" could include hedge funds.
RESPONSE: The Registrant does not currently contemplate investing in
hedge funds.
18. COMMENT: With respect to the "Net Asset Value Determination" section
of the SAI, the Staff requested that the Registrant explain how far
back in time it would go when reprocessing shareholder transactions in
situations where an error has occurred in a Fund's NAV calculation.
RESPONSE: The Fund will reprocess shareholder transactions only if
they meet a certain threshold. If the error is greater than 1/2 of 1%
of the Fund's net asset value per share, transactions will be
reprocessed for any shareholder account with respect to which the
total impact of the error was $10.00 or more. Qualifying transactions
will be reprocessed back to the date of the error. Multiple-day errors
are viewed as one error (not multiple errors).
19. COMMENT: The Staff requested that the Registrant provide a Tandy
representation in a response letter to be filed as correspondence
separate from the filing.
RESPONSE: The Registrant provides its response below.
The Registrant acknowledges responsibility for the adequacy and accuracy of the
disclosure in the filings. In addition, the Registrant acknowledges that Staff
comments, or changes to disclosure in response to Staff comments in the filings
reviewed by the Staff, do not foreclose the Commission from taking any action
with respect to the filing.
If you have any concerns regarding the above responses, please call me at (303)
336-4562. Thank you for your assistance in this matter.
Regards,
/s/ Rodney DeWalt
Rodney DeWalt
Legal Counsel
cc: Stephanie Grauerholz-Lofton, Esq.
Robin Nesbitt, Esq.
Donna Brungardt