Janus Capital is a name investors might associate more with the US market than the UK retail space, but that is gradually changing. A number of high-profile appointments, including the hiring of Myron Scholes, co-creator of the Black-Scholes options pricing model, and the poaching of Bill Gross from Pimco in September 2014, have shone a spotlight on the company in the UK.
Chris Justice, chief operating officer and head of Europe at Janus Capital International, makes no bones about the way Mr Gross’s arrival helped to build Janus’s profile. “He’s one of the greatest fixed income investors of all time, so having him on board of course is tremendous. [Then] mid-year last year we acquired a team to be around him, a company called Kapstream [Capital] out of Sydney.
“We have a team of global macro fixed income capabilities that provides a great absolute return track record for clients. We just need to continue to make the market aware of that broad range of solutions that we have to offer.”
But there is more to the firm than just star managers, says Sylvain Agar, head of financial institutions for the UK and Europe.
He explains: “We’re delighted to have Bill join Janus, not only for the fixed income franchise – we’ve obviously been managing fixed income for decades – but also for our brand and awareness.
“We’ve had the opportunity with Myron and Bill to really raise our profile to the UK audience, but also the European retail audience. That’s definitely a plus, but it’s not all about these world-renowned experts, [it’s] very much about our research and our product range available to our UK clients. We’ve been in the UK for about 15 years, but I would say that we’ve had some key distribution partnerships in the past few years that have really helped us to be more visible on UK platforms.”
In particular, he highlights thematic funds such as the Janus Global Life Sciences and Global Real Estate funds, available through the Janus Capital Fund (JCF) Irish platform.
The traditional fixed income range is also attracting interest from the UK, including its Global High Yield and Global Investment Grade offerings. Mr Agar also points to a partnership with Asian fund firm Diam that has strengthened its position in Japanese and Asian equities. It means Janus is “not just a niche boutique entity, but a full provider. And we continue to develop [in] multi-asset, absolute return and fixed income as well.”
Mr Justice took on the role of chief operating officer of Europe, Middle East and Africa (Emea) last September, having spent time in Hong Kong working with Augie Cheh, chief executive of the international business, on the overall international strategy for the company. In recent years Dick Weil, the chief executive of Janus, has focused on diversifying the business.
“Janus was always known for being a very fundamental, credit-driven, research-driven investment house, and historically a bit US-focused,” says Mr Justice. “One of [Mr Weil’s] key initiatives was to continue to diversify the product range internationally with global strategies.
“Since [Mr Weil] joined, he brought on Myron Scholes to develop adaptive multi-asset allocation strategies, which were rolled out last year in the US and which we’ve been introducing to the international markets.”
A second objective was to diversify the company internationally as well. So in his previous role as head of strategic initiatives at Janus, Mr Justice worked closely with the teams in Emea and Asia-Pacific, “looking at, were we in the right places for the business? Did we have the right people in the right places to grow the business and serve the clients? Where were the markets we should be focusing on growing our business? Were we in all the markets where we should be?”
He explains the move to London as COO, saying: “The opportunity for Janus in Europe is tremendous, we have a very balanced business between institutional and financial intermediary/retail across the continent and we have lots of opportunities to continue to grow.”
He says the firm is “very flexible in terms of how we work with clients”. For example, it is happy to white label products for distribution partners. “We look at sub-advised opportunities, and there are plenty of opportunities with some tremendous strategies. [Also] not all of our US funds are on our JCF platform, so there is plenty of opportunity to add additional funds, which we look at all the time. We continually introduce new funds on to the platform for European investors.”
Mr Agar says that in the UK, this sub-advisory, white label banking distribution or life insurance type of platform is widely used, “and that’s where we see our opportunities to find more collaboration in the UK”.
But he adds: “We have this expertise internally, these experts who are able to apply their research, skill set or tools to a specific product that will fit the needs of a UK-based investor. [So] we do look at opportunities where we could launch a product which is more inclined for a European audience than the US audience.”
While Mr Agar acknowledges the focus in the UK “might have been a bit more institutional, wealth manager sub-advisory business” in the past, Janus is now aiming more at the retail market with a larger London servicing team and “some success on the key platforms and some of the wealth manager groups”.
“We’re getting a bit deeper into the market, a bit closer to our clients. With the RDR share classes, we adapted to the local market requirement,” he adds. “As of today, we do not offer an Oeic, we know for the UK market it’s important. But we always want to answer the local needs and capture opportunities. The UK would be one of the retail markets in Europe where we still have room for growth and opportunities.”
Product development, therefore, continues to be a big part of the push in the UK and Europe, with fixed income one of the areas of interest.
“The other area we really see clients looking at and asking about is less benchmark-constrained ways of looking at their portfolios,” says Mr Justice. “We’re very happy to be able to provide clients with absolute return type strategies, and in this market environment there’s a lot of interest in that and in the multi-asset area as well.
“People are really looking at, where should we be investing? For us it’s very important to have that broad product suite. The other area we see [opportunities] with the volatility in the markets is [with] Intech – the ‘mathematical’ manager within Janus. Their strategies are very appropriate and very appealing... because they look at volatility and they harvest the alpha from the volatility that is inherent in every market. Those are areas that we see a lot of client interest.”
Mr Justice’s priority in the next year or so is continuing the growth achieved in the past few years. “That will be driven by a continued presence in markets locally, be it the UK or continental Europe, having the right product set and solutions for clients, and being able to address client demands for solutions in some [other] areas. Whether it’s managed volatility, low volatility, absolute return, even ETFs – where last year we acquired a company in the US called VelocityShares – [we’re] looking at opportunities in Europe for bringing that expertise to bear.”
Mr Agar adds that in a challenging environment, clients are looking for more diverse investment. But he warns: “We don’t just parcel products. The DNA of Janus is research.”
Mr Justice agrees: “That fundamental focus on research and credit analysis is built into all of the investment processes across all of the equity and fixed income ranges. We have amazing [research expertise]. That brings a lot of breadth and depth to our thought leadership, what we are able to bring to our clients, what we are able to offer our clients in terms of investment solutions. They are experts, whether you’re looking at the macro or the micro.”
CV
Chris Justice
2015 – present
Chief operating officer, head of Europe, Janus Capital International
2013 – 2015
Vice-president, strategic initiatives, Janus Capital
2008 – 2013
Managing director, Quam
2004 – 2008
Director, Everlearn Group
1999 – 2004
Co-founder, chief executive, Asiacontent.com
1995 – 1999
Publisher SCMP.com, South China Morning Post Group
1989 – 1994
Associate, Morningside Group
1983 – 1989
Associate, Bankers Trust Company
CV
Sylvain Agar
2014 – Present
Head of financial institutions, UK and Europe, Janus Capital International
2011 – 2014
Head of French-speaking Europe sales, Janus Capital
2008 – 2011
Sales director, French-speaking Europe, Janus Capital
2006 – 2008
Business development associate, investment marketing manager, TriAlpha Investment Advisors
