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Fund Times: Big Management Changes at Janus

Plus, news on MFS, ING, Van Kampen, Third Avenue, Ariel, and more.

Morningstar Analysts, 06/26/2006

Janus Capital on Thursday announced the resignation of two long-tenured managers: Blaine Rollins and Claire Young, effective June 30. In February, David Corkins replaced Rollins as manager of the firm's flagship $11 billion Janus Fund JANSX, and Rollins was moved to the smaller ($147 million) Janus Triton JATTX. Research analysts Brian Schaub and Chad Meade will take over at Triton.

Young, manager of Janus Olympus  JAOLX since September 1997, had fared better in her charge, despite having wildly volatile returns during the tech boom and bust years. Ron Sachs, of Janus Orion JORNX, will replace her. He will continue to manage Orion, where he's delivered good returns in recent years following a rough start in the bear market.

MFS Introduces New Income-Oriented Fund
MFS Investment Management recently announced the upcoming launch of the MFS Diversified Income Fund, which is designed to both provide income to investors and combat inflation's erosion of invested capital.

Chief investment strategist James Swanson, who will be assisted by a quantitative asset-allocation group within the firm, will manage the fund. The fund will shift between five distinct asset segments: high yield, government, and emerging markets bonds; real estate investment trusts; and domestic value stocks. The firm's intention here is to provide income through asset class sectors that have low performance correlations with one another, and in this way provide both income and capital appreciation.

Keeley Small Cap Value Announces 2-for-1 Share Split
Keeley Small Cap Value KSCVX, managed by John Keeley Jr., will undergo a 2-for-1 share split, according to a statement released by Keeley Asset Management Corp., the fund's advisor. Fund share splits of this kind have no benefit to shareholders whatsoever, and typically the only reason to split a fund is for marketing purposes, because many novice investors tend to be attracted to funds with lower NAVs.

Keeley also announced it is launching Keeley All Cap Value. Like Keeley's other charge, the All Cap fund will focus on the stock of companies he believes are undervalued and are undergoing corporate restructurings of some kind. According to the press release, this situation will include corporate spin-offs, distressed companies, and others undergoing similar changes.

ING International Gets New Management
ING International's LEXIX longtime managers, Richard Saler and Philip Schwartz, have departed this mutual fund, and have been replaced by Uri Landesman, according to an ING regulatory filing. Saler and Schwartz had run the fund for over a decade, and while their long-term record was quite respectable, the fund's performance had fallen on hard times recently. Indeed, the fund suffered bottom-quartile performance in two of the past three calendar years. The fund's steep 1.65% expense ratio doesn't help matters here, of course.

Landesman, who joined ING from Federated Investors, where he served most recently as director of global equity research, has also previously worked at Arlington Capital Management and Sanford Bernstein and Co.

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