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January 22, 2015 at 07:20 AM
Bill Gross invested more than $700 million of his own money in his unconstrained bond fund, Janus Capital Group Inc.’s (JNS) Chief Executive Officer Dick Weil said Thursday during a conference call with investors and analysts.
Gross is “proud to eat his own cooking,” Weil said on a call discussing fourth-quarter earnings. Gross will also manage a new exchange-traded product for the firm, which the firm is planning in coming months, Weil said.
Janus rose as much as 9.9 percent, the most since the firm announced Gross’s decision to join, as it attracted the first net subscriptions in more than five years. Janus drew money across fixed-income funds and there were more of its products on brokerage platforms run by Fidelity Investments and Charles Schwab Corp., Weil said.
“2014 was a major step forward for Janus,” Weil said. [Gross' investment was reported earlier in January, but not confirmed by Janus until Thursday.]
Gross, a bond legend who surprised the financial world by joining Denver-based Janus, has a history of putting his own money into the funds he manages, a move that can be seen as a vote of confidence in his strategy and can help attract bigger investors. His contribution accounts for a quarter of the $2.8 billion that Janus attracted into its fixed-income funds in the fourth quarter, helping to break a streak of 21 straight quarters of investor withdrawals.
Janus shares rose 9.4 percent to $17.81 at 10:51 a.m. in New York, the most since Sept. 26. Janus shares, which surged a record 43 percent that day, climbed 30 percent last year, compared with 7.6 percent for the 18-company Standard & Poor’s Index of asset managers and custody banks.
Beating Estimates
Janus today reported fourth-quarter earnings that rose 18 percent as it broke a 21-quarter streak of net investor withdrawals. Net income increased to $45.2 million, or 24 cents a share, from $38.3 million, or 21 cents, a year earlier, the firm said today in a statement. Earnings beat the 21-cent average per-share estimate of 12 analysts surveyed by Bloomberg.
Weil, 51, has raised Janus’s profile in the past year, hiring Gross and buying an exchange-traded product provider. Since taking over in 2010, Weil had struggled to stem client defections as he expanded the fixed-income team and created a multi-asset investing group.
