Smart Beta. Smart Alpha


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Smart Beta. Smart Alpha.

Consider INTECH Funds for your Client’s Core

The need for “smart” alternatives to cap-weighted indices is not new. That’s why more than 25 years ago INTECH, a subsidiary of Janus, first introduced the idea that it’s possible to outperform a cap-weighted index by using the power of natural stock price movements and dynamic rebalancing to generate alpha for our clients. Some people call it smart beta. We call it smart alpha.

Designed to help investors improve the CORE of their portfolio: Consistency

Outperformance

REpeatability

Style consistent portfolios seeking to provide dependable asset class exposure

Seeks long-term total returns over respective benchmarks, without concentration or high beta risk

25+ years of applying a disciplined mathematical investment process, providing potential complementary strengths in an investor’s portfolio

INTECH’s Investment Process What most investors do in building a diversified portfolio – allocating across various asset classes based on a risk/reward target and rebalancing periodically – INTECH does at the stock level. INTECH’s process overweights stocks with low correlations and high stock price movements relative to one another in an attempt to maximise the gains captured through dynamic portfolio rebalancing.

STEP 1

Estimation

STEP 2

Portfolio Construction

Step 1: Estimation INTECH’s proprietary process estimates stock price movements and correlations for each stock found in their respective benchmark (e.g. S&P 500® Index for INTECH U.S. Core Fund).

Step 2: Portfolio Construction Based upon the output of Step 1, stocks with high relative price movements and low correlations are selected and weighted to achieve the most optimal risk-reward portfolio.

Step 3: Dynamic Rebalancing STEP 3

Dynamic Rebalancing

By dynamically rebalancing at the stock level via a proprietary trading system, INTECH seeks to efficiently capture a rebalancing premium – buy low / sell high.

Investing involves risk, including the possible loss of principal and fluctuation of value. The proprietary mathematical process used by INTECH may not achieve the desired results. The weighting of securities within the Fund’s portfolio may differ significantly from the weightings within the index. The index is unmanaged and not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.

Introduced by Janus Capital International Limited FOR PROFESSIONAL USE ONLY / NOT FOR PUBLIC VIEWING OR DISTRIBUTION

Continued on back page.

INTECH FUNDS

INTECH’s Philosophy and Unique Alpha Source Conventional Active Fund Managers Approach Alpha-Source Dependent Upon Volatility and Correlations

Stock-centric

Portfolio-centric

Fundamental or Quantitative

Price movement and rebalancing

Forecasting returns or factor models

A natural, ever-present source of alpha borne out of mathematics

Use at end of the investment process to reduce risk

Use throughout the process in an attempt to produce excess return and manage risk

Mixed

High

Sometimes

Yes

Alpha-Source Reliability Uncorrelated Source of Alpha

Performance (%) as of 31/12/16 INTECH U.S. Core Fund I$acc: 25/4/03 U.S. Large-Cap Blend Equity

Fund Size (as of 31/12/16)

Share Class

4Q16

1 Year

3 Year

5 Year

10 Year

Since Inception

$123.2 M

I$acc

2.23

7.67

7.27

13.25

6.03

8.90

3.82

11.96

8.87

14.66

6.95

9.12

I$acc

-3.52

1.91

-1.45





1.79

I$inc

-3.59

1.82

-1.47





1.78

-0.32

9.29

2.73





5.38

S&P 500® Index INTECH Global Income Managed Volatility Fund I$acc: 28/3/13 I$inc: 28/3/13

Global Equity Income MSCI World High Dividend Yield Index

$1.9 M

Source: Morningstar. Returns quoted are past performance and do not guarantee future results; current performance may be lower or higher. Investment returns and principal value will vary; there may be a gain or loss when shares are sold. Returns greater than one year are annualised.

For more information, please contact your Janus representative or visit janusinternational.com. Issued in: (a) Europe by Janus Capital International Limited (“JCIL”), authorised and regulated in the U.K by the Financial Conduct Authority; (b) Dubai by JCIL authorised and regulated by the Dubai Financial Services Authority as a Representative Office and; (c) Switzerland by Janus Capital (Switzerland) LLC, authorised and regulated by FINMA. Janus Capital Funds Plc is a UCITS established under Irish law, with segregated liability between funds. Shares of the JCF Funds (the “Funds”) may not be directly or indirectly offered or sold to U.S. Persons and may not be offered or sold in any jurisdiction where such offering or sale is prohibited. For the definition of U.S. Person, see the current Fund prospectus, a copy of which, along with the relevant Key Investor Information Document (KIID), can be found www.janusinternational.com/nra/intermediary/en-gb . The Funds have been authorized for public sale in certain jurisdictions and private placement exemptions may be available in others. A list of those countries in which JCF shares are registered for public distribution is available www.janusinternational.com/nra/intermediary/en-gb. Please contact your Janus representative if you are unsure of the availability of the Funds in your client’s jurisdiction. It is the responsibility of any persons wishing to distribute and/or purchase shares of the Funds to comply with all applicable laws and regulations of any jurisdiction in which Fund shares or any related literature, will be distributed or purchased. This document is intended to be of general interest only and does not constitute legal, tax or investment advice nor is it an offer or solicitation to purchase shares of the Funds, and may not comply with all local laws applicable to marketing materials. An investment in a Fund entails risks, which are described in a Fund’s prospectus and KIID. Financial advisers are responsible for determining whether an investment in the Funds, and which share class, is suitable for their clients. The value of shares of a Fund and income received from it can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance. An investment in the Funds is not FDIC insured, may lose value, and is not bank-guaranteed. The index returns are provided to represent the investment environment existing during the time periods shown. For comparison purposes, the index is fully invested, which includes the reinvestment of dividends and capital gains. The returns for the index do not include any transaction costs, management fees or other costs, and are gross of dividend tax withholdings unless otherwise noted. Composition of each individual portfolio may differ from securities in the corresponding benchmark index. The index is used as a performance benchmark only, as Janus does not attempt to replicate an index. Because sector weightings are a residual of portfolio construction, significant differences between sector weightings in client portfolios and the index are common. Copyright © 2016 Morningstar UK Limited. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Ratings shown may differ between Asia, the Americas and Europe, as well as between the US$ and Euro/Pound Sterling share classes of the Janus Capital Funds Plc.The Euro/Pound Sterling share class is a fully hedged share class, however, due to Morningstar’s calculation methodology, the Morningstar ratings for the Euro/Pound Sterling share classes will fluctuate in line with the US$ and Euro/Pound Sterling exchange rate. Therefore Morningstar’s rating for the Euro/Pound 2 Sterling share classes may not be an accurate reflection of underlying fund performance. All funds with the required track record are rated but only ratings of three stars and above are being displayed. Past performance is not a guarantee of future results. There is no assurance that the investment process will consistently lead to successful investing. The opinions are those of the authors and are subject to change at any time due to changes in market or economic conditions. The comments should not be construed as investment advice or a recommendation of individual holdings or market sectors, but as an illustration of broader themes. Any portfolio risk management process discussed includes an effort to monitor and manage risk which should not be confused with and does not imply low risk or the ability to control risk. Janus Capital Management LLC, Janus Capital Singapore Limited, INTECH Investment Management LLC and Perkins Investment Management LLC will act as sub-adviser to Janus Capital International Limited. Janus and INTECH are registered trademarks of Janus International Holding LLC. © Janus International Holding LLC. FOR PROFESSIONAL USE ONLY. LQ-1116(4-T)1117 NRA Inst

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