Janus to Hold Back Cash Flow Specifics

The Securities and Exchange Commission wants companies to be more forthcoming with information to all of their investors, but Janus Capital Corp. appears to be going the other way.

Janus, which earlier this year had the hottest-selling funds in the industry, said this week that it will provide only broad guidance on monthly cash flows to its funds, after September data caused confusion that the company fears may have worried investors unduly.

Janus said it expects October cash flows to be flat, with “modest” outflows from its retail funds and net inflows to institutional funds.

Janus spokeswoman Jane Ingalls said the policy will remain in effect no matter what cash flows show. Ingalls admitted the timing of Janus’ decision looks suspicious given that the growth stocks that helped its retail funds attract a record $11.4 billion in February have faltered since spring.

Many of Janus’ stock funds are showing negative returns year to date after soaring in 1998 and 1999.

Burton Greenwald, a Philadelphia-based mutual-fund consultant, said Janus’ decision to withhold specific number estimates suggests it’s concerned about perceptions now that cash flows are “dramatically different” from what they were earlier this year.

“The industry has been too forthcoming when it served their purpose to stick out their chests and make brags,” Greenwald said. “And then when the wind changes direction, they are very reluctant, and that unfortunately creates credibility questions.”