Plus, news on Masters' replacement of Ariel, a new Calvert fund, and more.
When Janus Capital Group
Ultimately, the consultant found that total losses (combining dilution, incremental portfolio trading and administrative costs, and total foregone appreciation) amounted to roughly $21 million. That is less than the $100 million Janus has set aside, but the full $100 million will be paid out. Even so, the payouts per shareholder will generally be very small, and any payout amounting to less than $10 will be put back in the fund affected rather than going to the shareholder remuneration. That seems like a reasonable cutoff to us, but it's worth noting that roughly two thirds of individual accountholders are entitled to a payout of $10 or less, and thus will not be getting a check. Those who believe they are entitled to direct restoration should contact Janus and file a claim for the amount lost.
Nine months after all the payments are sent, those payouts of less than $10 along with all remaining money (such as uncashed checks) will be allocated to the seven funds affected in proportion to the losses suffered at each fund. Affected funds include: Janus Mercury (now named Janus Research
Ariel Replaced at Masters' Fund
Masters' Select Funds' advisor, Litman/Gregory Fund Advisors, shuffled subadvisors at Masters' Select Smaller Companies
While we're disappointed to see an esteemed investor like Rogers replaced, Litman/Gregory has replaced strong managers in the past. For example, in late October 2003, Sig Segalas of Jennison Associates was replaced at Masters' Select Equity
Calvert Launches International Smaller Cap Offering
Calvert Asset Management recently launched Calvert International Opportunities, a socially responsible fund that invests primarily in small- and mid-cap companies. The fund will be subadvised by F&C Management Limited of London, with Sophie Horsfall, the firm's director of global equities, leading the group, and comanagers Jeremy Tigue and Terry Coles backing her. The team will look to the Citigroup/S&P World ex-U.S. EMI Index as a benchmark, and for capitalization range constraints, but it will have a lot of flexibility. For instance, the team can invest up to 20% of its assets in emerging-markets-based firms, and it can search out opportunities in any geographic region of the world. (The portfolio will be unhedged.) After a fee waiver, the expense ratio will be 1.66%, about on par with similar front-load offerings.
PIMCO Moves to Using Duration-Band Approach
In a recent regulatory filing, bond giant PIMCO indicated it was altering the interest-rate approach of several fixed-income funds, moving from a range-bound approach to typical duration (a measure of interest-rate risk) management, to one that emphasizes bands around respective fund benchmarks. For example, the flagship PIMCO Total Return Bond