Janus Forty Fund Potential


For a large growth fund with net assets as big as $5.5 billion (as on July 31, 2009), the Janus Forty A Fund (Symbol-JDCAX) is remarkably steady, the jolts of the last two quarters in 2008 notwithstanding. It has done well to bounce back into positive territory from April this year to be in the top five funds in the large growth category. It is a five-star large growth fund with high returns potential.

Ron Sachs, fund manager at Janus since 1996 and has been overseeing the Janus Forty Fund since 2008, says: “My biggest positions tend to be those that I have the most confidence in over the long term and I want to own them for years.” Most investors would find this statement very reassuring.

Launched in May 1997 as the Janus Advisor Forty Fund, it was the top performing fund in 2007 with an annual return of 35.9%. This fund has posted positive double-digit returns in the last five years, barring a bad fall it had last year as a result of the global recession. In 2008, it returns fell steeply to -43.9%. It was merged into the Janus Forty Fund, effective from July 6, 2009.

It is an open-ended mutual fund incorporated in the USA. Objective is long term growth of capital. It invests in companies of all sizes and which have growth potential. The minimum investment required is $2500 with an entry load of 5.75%.

The fund’s low portfolio turnover of 42% and its concentrated holdings (Its top five holdings account for [email protected] of net assets) reveal Ron Sach’s conviction that his bets will generate high value in the longer term. His top holdings include Apple Inc, Research in Motion Ltd, Gilead Sciences Inc, Celgene Corporation and CVS Caremark Corporation.

The fund’s NAV (net asset value) stood at $28.31 as on August 17, 2009. It NAV moved in the range of $18.74-$39.19 in the last 52 weeks. Morningstar continues to recommend the fund despite its poor performance in the latter half of 2008

For the last three years, the fund has retained more than 50% exposure in the healthcare, telecommunications and computer hardware sectors. It asset allocation mix includes 91.5% in stocks and the balance in cash. Foreign stocks account for 24.3% of its assets.

The Janus Forty Fund carries high risks not only for its leveraged investments but also because its cash holdings can be high at times as part of a deliberate strategy. It also employs short sales as a speculative tool whenever required.