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| Janus Jug Five (3) (Photo credit: 1f2frfbf) |
So what took so long? Fund companies euthanize their weakest offspring all the time, but they work hard to keep their cash cows — recognized names that deliver large fees long after performance no longer deserves the big bucks.
Why do investors stick around to the bitter end?
Janus Worldwide (MFD:JAWWX) has seen its assets shrink to around $1.9 billion from about $45 billion before the Internet bubble burst in 2000. The fund’s performance has been so bad, you’d be hard-pressed to justify keeping your money riding with it.
Where Janus Worldwide once was a model of investing success, it’s now a cautionary tale of why you should never stick with a fund when its results turn abusive.
Let’s recap the Worldwide story. From its May 1991 inception until the tech bubble burst in March of 2000, Janus Worldwide returned almost three times the cumulative return of the typical world-stock fund, according to investment researcher Morningstar Inc. Janus(NYSE:JNS) was the hottest fund company in the business — Worldwide rivaled the flagship Janus fund (MFD:JANSX) in assets — with investors loading up on every growth-oriented flavor the firm offered.
But when the growth stopped, those funds went south together. But unlike other Janus funds, Worldwide never really recovered. A series of managers over the years couldn’t muster more than a 4.4% annualized gain over the last decade for the fund, about two full points below the category average and in the bottom 2% of Morningstar’s world-stock fund group. Even with its late 1990s salad days lumped into results, the fund’s 15-year record ranks in the bottom 5% of its peers. ... Continue to read.
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