Q. I'd like to know more about Janus Growth & Income Fund, which was recommended to me.
A. Minyoung Sohn, the fund's portfolio manager since early 2004, seeks both capital appreciation and income.
The $6.8 billion Janus Growth & Income Fund (JAGIX), which has had 21 percent growth in total return over the past 12 months, ranks in the top half of large-cap growth funds. Its three-year annualized return of 14 percent puts it in the top 12 percent of that category.
Industrial materials, energy, financial services and health care are its largest sector weightings. Top holdings are General Electric Co., CVS Caremark Corp., Valero Energy Corp., EMC Corp., Procter & Gamble Co., Hess Corp., EnCana Corp., Roche Holding Ltd., Citigroup Inc. and Exxon Mobil Corp.
Sohn is attempting to increase the fund's income by putting up to 15 percent of its assets into structured notes, which are lending agreements with large investment banks and other parties that generate current income by selling off part of a stock's upside potential.
"We recommend this fund for investors looking for a core growth holding," said Andrew Gogerty, analyst with Morningstar Inc. "There is a learning curve to getting efficient in using structured notes and Sohn is one of the newer Janus managers, but so far his picks tend to be well thought out and researched to a high degree."
Sohn, an analyst at Janus since 1998, also runs Janus Fundamental Equity Fund. He prefers companies with strong balance sheets that can produce higher-than-expected earnings or cash-flow growth. Turnover is about half that of most large-cap growth funds and the fund is more diverse than some other Janus growth funds.
"Making the transition from analyst to manager requires a similar but different set of skills, so the risk is that there are going to be some bumps along the way," said Gogerty, acknowledging that Sohn made some past mistakes in positioning the portfolio in some technology and health-care stocks.
This "no-load" (no sales charge) fund requires a $2,500 minimum initial investment and has an annual expense ratio of 0.88 percent.
Q. What is the best way to buy a foreign stock? Does it matter if it trades on a foreign exchange rather than a U.S. exchange?
R.C., via the Internet
A. The easiest way is through an American depositary receipt, or ADR, for foreign companies that offer them. This is a stock that trades on a U.S. stock exchange but represents a specified number of shares in a foreign company that is seeking to attract U.S. investors.
For companies not available as ADRs, the investor must buy the actual stock on a foreign exchange, in which case a U.S. brokerage firm handling the transaction is likely to charge more because it is somewhat more complicated than buying here.
"ADRs are filed with the Securities and Exchange Commission, they trade and settle under its rules, and they settle in U.S. dollars," said Julio Lugo, vice president of global capital markets for the Bank of New York. "Those that trade on the NYSE, Amex and Nasdaq must file a 20-F, an equivalent to the 10-K filed by U.S. firms that follows generally accepted accounting principles."
Of about 2,000 available ADRs around 450 trade on the New York Stock Exchange, American Stock Exchange and Nasdaq stock market, about 1,100 trade over the counter and the rest trade in the private market for qualified institutional buyers.
Andrew Leckey is a Tribune Media Services columnist. E-mail him at email@example.com.Copyright © 2015, Los Angeles Times