Janus Capital Group Inc.JNS

Fund performance continues to improve at Janus Capital Management. As of the end of the third quarter, 83%, 94%, and 88% of Janus equity mutual funds (and 100% of fixed-income mutual funds) are in the top two Lipper quartiles on a 1-, 3-, and 5-year total return basis. In addition, more than 60% of these funds had 4- or 5-star ratings from Morningstar at the end of the period.

Janus' long-term fund flows turned positive in the second quarter of 2009, after posting three quarters of outflows that (on average) exceeded $1 billion in each period.

The acquisition of INTECH in 2002 tapped into the growing demand for quantitative-based investing, allowing Janus to not only build AUM in a nongrowth category but increase the level of assets the firm managed for institutional investors.

Janus completed the acquisition of an additional 50% of Perkins Investment Management at the end of 2008, bringing its ownership stake in this successful value-driven asset manager to 80%. Read more 

Despite seeing performance and fund flows improve during the last two quarters at Perkins and Janus Capital Management, weak short- and intermediate-term performance at INTECH led to $2.5 billion in outflows from the quantitative manager during the third quarter.

There are growing concerns that the rise of high frequency trading has affected INTECH's ability to generate outsized returns with the quantitative methods it uses to capitalize on the random nature of stock price movements.

With the disruption in the financial markets sparking consolidation among many of the brokers, advisers, and bankers that sell mutual funds to retail investors, the asset managers have lost some of the leverage they traditionally had when it came to negotiating payments for shelf space. Read more