Janus Is Growing a Second Face -- and So Should You

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Like Nascar drivers tired of blowing out their engines, some Janus fund managers might be tinkering a bit under the hood.

Following a second tough year for the Denver firm's tech- and telecom-heavy growth funds, last week a quartet of Janus managers told reporters they're not changing the grass-roots research process they made popular in ads and Wall Street lore. But the funds' recent moves indicate that some managers are charting a less risky course as they put their portfolios together. The upshot for Janus shareholders: After the past three years' high highs and low lows, you might see a bit less of each going forward.

"In general the portfolios are a lot better diversified than they were in the past," says Christine Benz, the analyst who covers the Janus growth funds for Chicago research house Morningstar. "But investors should keep in mind that in their current positioning they won't be able to deliver the upside some investors are expecting. For the last 90 days tech has been hot, and these funds have been so-so."

She's right. Janus offers seven direct-sold, big-cap growth funds, the style it's best known for. Only one, (JAOLX Quote)Olympus, is beating its average peer over the past 90 days, according to Morningstar. On average, the category is up 9% over that stretch, beating traditional tech fans like Janus (up 6.3%) and Mercury (up 6.7%). And the typically high-octane Enterprise fund is up just 2.5%, compared with a 7.7% gain for its average peer. ...