Janus fund assets rise 100-fold since Bill Gross took over

In the realm of fixed-income investments, dethroned Pimco bond king Bill Gross still commands a healthy measure of respect as he settles in at a freewheeling Janus Capital mutual fund.

The Janus Global Unconstrained Bond Fund had just $12 million in assets before Gross, after clashing with other executives at Pacific Investment Management Co., quit in late September to run the nontraditional fund.

In November, $770 million flowed into the Janus Unconstrained fund, Chicago investment tracker Morningstar Inc. said Monday. That meant total assets had swelled since Gross’ arrival by a hundredfold, to more than $1.2 billion.

That figure does not count the $500 million that a family fund controlled by hedge fund baron George Soros planned to invest in a separate Janus account managed by Gross.

For decades at Pimco, Gross earned returns far better than most of his money-management peers before several recent years of spotty performance.

At Janus, he operates without the resources available at Pimco, the world’s largest fixed-income manager with $1.7 trillion in bond investments. Indeed, he is starting with just a handful of associates supporting him.

But analysts said the Gross fund has a chance to accumulate a more diverse group of bonds, including smaller investments that could pay off big, than he could while managing Pimco’s benchmark Total Return Fund, which had $162.8 billion in assets Nov. 30.

So far, most of the money flowing into Gross’ new fund are probably coming from individual investors. Large pension funds, insurers and other institutions “appear to be waiting for a couple of months” until the operation is fully up and running and they can evaluate it more carefully, Morningstar analyst Sumit Desai said.

“The question is, what can you do without the fire hose of information he had available at Pimco?” Desai said. “But on the other hand, there’s a lot more flexibility at Janus.”

Unconstrained bond mutual funds as a group reported losses in October and November. The Janus Unconstrained fund, by contrast, recorded slight gains in both months.

But Gross is not yet into bragging rights territory -- Pimco’s main unconstrained fund had similar small gain over the two-month period, Morningstar data showed.

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