Investors Scramble Onto Janus Value Wagon
Contrary to popular belief, value investing is alive and well.
At least, Denver-based Janus Funds’ version of value.
The nation’s fastest-growing fund manager, famous for its go-go growth stock portfolios, recently opened its first value-oriented offering, Janus Strategic Value--and promptly raised more than $1.5 billion during its 30-day subscription period.
That’s seven times more money than it raised during the subscription periods for Janus Global Life Sciences and Janus Global Technology funds--two of the complex’s hottest portfolios--combined.
Meanwhile, the vast majority of value funds, which search for overlooked or beaten-down stocks, are out of favor and bleeding assets through redemptions as a result.
According to the mutual fund tracker Lipper Inc., value-oriented funds suffered net outflows of about $12 billion in January. At the same time, growth funds, which have whipped value in recent years based on average performance, enjoyed net inflows of about $27 billion.
But the mad rush into Janus Strategic Value, which began trading Wednesday, “is not a victory for value investing or asset allocation,” said John Rekenthaler, director of research for fund tracker Morningstar Inc. “This is a defeat for asset allocation. This is a victory for performance-chasing.”
“It’s the name ‘Janus,’ ” Rekenthaler said. “Nobody wants a Vanguard value fund or a Fidelity value fund. But Janus has had not just a golden touch, but really a platinum touch. There’s a reasonable willingness to give any new Janus fund a whirl.”
Janus’ value fund may not even be a true “value” fund--at least as investors have come to know the term.
“This is Janus’ approach to value,” notes company spokeswoman Jane Ingalls. “I don’t think it will necessarily resemble the typical value fund in the sense that with a broad charter it can invest in things that some other funds might not.”
For instance, it will be allowed to invest in small, medium and large stocks. And it can invest globally too.
Most of all, don’t be surprised to see some tech stocks and other names that some would label “growth” in the portfolio--so long as manager David Decker believes they are undervalued relative to his assessment of their true worth. That could be a big reason why so many fund investors are willing to embrace this value fund.