JANUS INVESTMENT FUND, 497, 1996-02-20

JANUS INVESTMENT FUND
497, 1996-02-20

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CONTENTS

FUNDS AT A GLANCE
Brief description of each Fund ............................................ 1
EXPENSE INFORMATION
Each Fund's annual operating expenses ..................................... 3
Financial Highlights-a summary of financial data .......................... 4
THE FUNDS IN DETAIL
The Funds' Investment Objectives and Policies ............................. 8
General Portfolio Policies ................................................ 13
Additional Risk Factors ................................................... 14
SHAREHOLDER'S MANUAL
Types of Account Ownership ................................................ 16

How to Open Your Janus Account ............................................ 17

Minimum Investment Policies ............................................... 17
How to Purchase Shares .................................................... 17
How to Exchange Shares .................................................... 18
How to Redeem Shares ...................................................... 18
SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JETS(R) ................................................................... 20
Transactions Through Processing Organizations ............................. 20
Taxpayer Identification Number ............................................ 20
Share Certificates ........................................................ 20
Involuntary Redemptions ................................................... 20
Telephone Transactions .................................................... 20
Making Changes to Your Account ............................................ 20
Statements and Reports .................................................... 20
MANAGEMENT OF THE FUNDS
Investment Adviser and Investment Personnel ............................... 21
Management Expenses ....................................................... 22
Portfolio Transactions .................................................... 22
Other Service Providers ................................................... 22
Other Information ......................................................... 23
DISTRIBUTIONS AND TAXES
Distributions ............................................................. 24
Taxes ..................................................................... 25
PERFORMANCE TERMS
An Explanation of Performance Terms ....................................... 25
APPENDIX A
Glossary of Investment Terms .............................................. 26
APPENDIX B
Explanation of Rating Categories .......................................... 29

[LOGO]
JANUS INVESTMENT FUND

100 Fillmore Street
Denver, CO 80206-4923
(800) 525-3713

February 18, 1996

A FAMILY OF NO-LOAD MUTUAL FUNDS

All Janus Funds are no-load investments. This means you may purchase and sell
shares in any of our mutual funds without incurring any sales charges. If you
enroll in our low minimum initial investment program, you can open your account
for as little as $500 and a $100 subsequent purchase per month. Otherwise, the
minimum initial investment is $2,500. For complete information on how to
purchase, exchange and sell shares, please see the Shareholder's Manual
beginning on page 16.

This Prospectus describes 12 mutual funds with a variety of investment
objectives, including growth of capital, current income and a combination of
growth and income (the "Funds"). Janus Capital Corporation ("Janus Capital")
serves as investment adviser to each Fund. Janus Capital has been in the
investment advisory business for over 25 years and currently manages more than
$30 billion in assets.

Each Fund is a series of Janus Investment Fund (the "Trust"). The Trust is
registered with the Securities and Exchange Commission ("SEC") as an open-end
management investment company. This Prospectus contains information about the
Funds that you should consider before investing. Please read it carefully and
keep it for future reference.

Additional information about the Funds is contained in a Statement of Additional
Information ("SAI") filed with the SEC. The SAI dated February 18, 1996, is
incorporated by reference into this Prospectus. For a copy of the SAI, write or
call the Funds at the address or phone number listed above.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SEC OR ANY STATE SECURITIES COMMISSION PASSED ON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY STATE OR
OTHER JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN
SUCH STATE OR OTHER JURISDICTION.

JANUS FUNDS COMBINED PROSPECTUS
<PAGE>

FUNDS AT A GLANCE

This section is designed to provide you with a brief overview of the Funds and
their investment emphasis. A more detailed discussion of the Funds' investment
objectives and policies begins on page 8 and complete information on how to
purchase, redeem and exchange shares begins on pages 17-18.

GROWTH FUNDS

JANUS FUND

Fund Focus: A diversified fund that seeks long-term growth of capital by
investing primarily in common stocks, with an emphasis on companies with larger
market capitalizations.

Fund Inception: February 1970

Fund Manager: James P. Craig, III

JANUS TWENTY FUND

Fund Focus: A nondiversified fund that seeks long-term growth of capital by
normally concentrating its investments in a core position of 20-30 common
stocks.

Fund Inception: April 1985

Fund Manager: Thomas F. Marsico

JANUS ENTERPRISE FUND

Fund Focus: A nondiversified fund that seeks long-term growth of capital by
investing primarily in common stocks, with an emphasis on securities issued by
medium-sized companies.

Fund Inception: September 1992

Fund Manager: James P. Goff

JANUS MERCURY FUND

Fund Focus: A nondiversified fund that seeks long-term growth of capital by
investing primarily in common stocks of companies of any size.

Fund Inception: May 1993

Fund Manager: Warren B. Lammert

JANUS WORLDWIDE FUND

Fund Focus: A diversified fund that seeks long-term growth of capital by
investing primarily in common stocks of foreign and domestic companies.

Fund Inception: May 1991

Fund Manager: Helen Young Hayes

JANUS OVERSEAS FUND

Fund Focus: A diversified fund that seeks long-term growth of capital by
investing primarily in common stocks of foreign companies.

Fund Inception: May 1994

Fund Manager: Helen Young Hayes

COMBINATION FUNDS

JANUS GROWTH AND INCOME FUND

Fund Focus: A diversified fund that seeks long-term growth of capital with a
limited emphasis on income. Although the Fund invests at least 25% of its assets
in securities selected primarily for their income potential, it emphasizes
equity securities selected for their growth potential.

Fund Inception: May 1991

Fund Manager: Thomas F. Marsico

JANUS BALANCED FUND

Fund Focus: A diversified fund that seeks long-term growth of capital, balanced
by current income. The Fund normally invests 40-60% of its assets in securities
selected primarily for their growth potential and 40-60% of its assets in
securities selected primarily for their income potential.

Fund Inception: September 1992

Fund Manager: Blaine P. Rollins

FIXED-INCOME FUNDS

JANUS FLEXIBLE INCOME FUND

Fund Focus: A diversified fund that seeks to maximize total return from a
combination of income and capital appreciation by investing in income-producing
securities. This Fund may have substantial holdings of lower rated debt
securities or "junk" bonds.

Fund Inception: July 1987

Fund Manager: Ronald V. Speaker

JANUS INTERMEDIATE GOVERNMENT SECURITIES FUND

Fund Focus: A diversified fund that seeks a high level of income while
minimizing credit risk by investing primarily in obligations of the U.S.
government and its agencies. Its average-weighted maturity is normally greater
than three years and less than ten years.

Fund Inception: July 1991

Fund Manager: Sandy R. Rufenacht

JANUS SHORT-TERM BOND FUND

Fund Focus: A diversified fund that seeks a high level of current income while
minimizing interest rate risk by investing in shorter term fixed-income
securities. Its average-weighted maturity is normally less than three years.

Fund Inception: September 1992

Fund Manager: Sandy R. Rufenacht

JANUS FEDERAL TAX-EXEMPT FUND

Fund Focus: A diversified fund that seeks a high level of current income exempt
from federal income tax by normally investing at least 80% of its assets in
municipal obligations.

Fund Inception: May 1993

Fund Manager: Darrell W. Watters

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
1
<PAGE>

JANUS SPECTRUM

The spectrum below shows Janus Capital's assessment of the potential overall
risk of the Janus Funds relative to one another and should not be used to
compare the Funds to other mutual funds or other types of investments. The
spectrum was determined based on a number of factors such as selected historic
volatility measurements, the types of securities in which the Funds intend to
invest, the degree of diversification intended and/or permitted, and the sizes
of the Funds and, in addition, was significantly affected by the portfolio
managers' investment styles. These factors were considered as of the date of
this prospectus and will be reassessed with each new prospectus. Specific risks
of certain types of instruments in which some of the Funds may invest, including
foreign securities, junk bonds and derivative instruments such as futures
contracts and options, are described under "Additional Risk Factors" on pages
14-15. THE SPECTRUM IS NOT INDICATIVE OF THE FUTURE VOLATILITY OR PERFORMANCE OF
A FUND AND RELATIVE POSITIONS OF FUNDS WITHIN THE SPECTRUM MAY CHANGE IN THE
FUTURE.

[SPECTRUM CHART]

The spectrum illustrates the potential overall risk of the Janus funds relative
to one another. The funds' risk ranges from conservative to aggressive. The
Growth Funds are illustrated as follows: Janus Fund is shown as moderate; Janus
Twenty Fund is shown as aggressive; Janus Enterprise Fund is shown as
aggressive; Janus Mercury Fund is shown as moderate-aggressive; Janus Worldwide
Fund is shown as moderate-aggressive (but less aggressive than Janus Mercury
Fund); Janus Venture Fund, which is closed to new investors and offered by a
separate prospectus and Janus Overseas Fund are shown as moderate-aggressive
(but more aggressive than Janus Worldwide Fund); and Janus Olympus Fund, which
commenced operations December 29, 1995 and is offered by a separate prospectus,
is shown as aggressive. The Combination Funds are illustrated as follows: Janus
Growth and Income Fund is shown as moderate-aggressive and Janus Balanced Fund
is shown as mostly moderate. The Fixed-Income Funds are illustrated as follows:
Janus High-Yield Fund, which commenced operations December 29, 1995 and is
offered by a separate prospectus, is shown as mostly moderate (but more
aggressive than Janus Balanced Fund); Janus Flexible-Income Fund is shown as
conservative-moderate; Janus Federal Tax-Exempt Fund is shown as
conservative-moderate (but more conservative than Janus Flexible Income Fund);
Janus Intermediate Government Securities Fund is shown as conservative-moderate
(but more conservative than Janus Federal Tax-Exempt Fund); and Janus
Intermediate Government Securities Fund is shown as conservative-moderate (but
more conservative than Janus Federal Tax-Exempt Fund); and Janus Short-Term Bond
Fund is shown as conservative.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
2
<PAGE>

EXPENSE INFORMATION

The tables and example below are designed to assist you in understanding the
various costs and expenses that you will bear directly or indirectly as an
investor in the Funds. Shareholder Transaction Expenses are fees charged
directly to your individual account when you buy, sell or exchange shares. The
table below shows that you pay no such fees. Annual Fund Operating Expenses are
paid out of each Fund's assets and include fees for portfolio management,
maintenance of shareholder accounts, shareholder servicing, accounting and other
services.

- --------------------------------------------------------------------------------
SHAREHOLDER TRANSACTION EXPENSES (applicable to each Fund)

Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales charges on redemptions None
Redemption fee* None
Exchange fee** None

* There is an $8 service fee for redemptions by wire.
** You may be charged a $5 transaction fee for excessive exchanges. See "How to
Exchange Shares" on page 18.
- --------------------------------------------------------------------------------

WHY DO EXPENSES VARY ACROSS THE FUNDS? EXPENSES VARY FOR A NUMBER OF REASONS
INCLUDING DIFFERENCES IN MANAGEMENT FEES, AVERAGE SHAREHOLDER ACCOUNT SIZE, THE
FREQUENCY OF DIVIDEND PAYMENTS, AND THE EXTENT OF FOREIGN INVESTMENTS WHICH
ENTAIL GREATER TRANSACTION COSTS.

ANNUAL FUND OPERATING EXPENSES(1)
(expressed as a percentage of average net assets)

<TABLE>
<CAPTION>
Management Fee Other Expenses Total Fund Operating Expenses
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Janus Fund 0.65% 0.22% 0.87%
Janus Twenty Fund 0.67% 0.33% 1.00%
Janus Enterprise Fund 0.75% 0.51% 1.26%
Janus Mercury Fund 0.69% 0.45% 1.14%
Janus Worldwide Fund 0.68% 0.56% 1.24%
Janus Overseas Fund 0.85% 0.91% 1.76%
Janus Growth and Income Fund 0.74% 0.45% 1.19%
Janus Balanced Fund 0.82% 0.53% 1.35%
Janus Flexible Income Fund 0.62% 0.34% 0.96%
Janus Intermediate Government Securities Fund(2) -- 0.65% 0.65%
Janus Short-Term Bond Fund(2) 0.08% 0.58% 0.66%
Janus Federal Tax-Exempt Fund(2) -- 0.70% 0.70%
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The information in the table above is based on expenses before expense
offset arrangements for the fiscal period ended October 31, 1995. When
applicable, all expenses are stated net of waivers by Janus Capital.
Waivers are first applied against the management fee and then against other
expenses.
(2) Net of waivers. Without such waivers, the Management Fee, Other Expenses
and Total Fund Operating Expenses would have been 0.50%, 0.72% and 1.22%,
respectively, for Janus Intermediate Government Securities Fund; 0.65%,
0.58% and 1.23%, respectively, for Janus Short-Term Bond Fund; and 0.60%,
0.71% and 1.31%, respectively, for Janus Federal Tax-Exempt Fund. Janus
Capital may modify or terminate the waivers at any time upon 90 days'
notice to the Trustees.

EXAMPLE

Assume you invest $1,000, the Funds return 5% annually and each Fund's expense
ratios remain as listed above. The example below shows the operating expenses
that you would indirectly bear as an investor in the Funds.

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Fund $ 9 $ 28 $ 48 $107
Janus Twenty Fund $ 10 $ 32 $ 55 $122
Janus Enterprise Fund $ 13 $ 40 $ 69 $152
Janus Mercury Fund $ 11 $ 36 $ 62 $136
Janus Worldwide Fund $ 13 $ 39 $ 68 $150
Janus Overseas Fund $ 18 $ 55 $ 95 $207
Janus Growth and Income Fund $ 12 $ 38 $ 65 $144
Janus Balanced Fund $ 14 $ 43 $ 74 $162
Janus Flexible Income Fund $ 10 $ 31 $ 53 $118
Janus Intermediate Government Securities Fund(2) $ 7 $ 21 $ 36 $ 81
Janus Short-Term Bond Fund(2) $ 7 $ 21 $ 37 $ 82
Janus Federal Tax-Exempt Fund(2) $ 7 $ 22 $ 39 $ 87
- ------------------------------------------------------------------------------------------
</TABLE>

THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE RETURNS
OR EXPENSES WHICH MAY BE MORE OR LESS THAN THOSE SHOWN.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
3
<PAGE>

FINANCIAL HIGHLIGHTS

Unless otherwise noted, the information below is for fiscal periods ending on
October 31 of each year. The accounting firm of Price Waterhouse LLP has audited
the Funds' financial statements since October 1, 1990. Their report is included
in the Funds' Annual Reports, which are incorporated by reference into the SAI.
The Funds' financial statements for fiscal periods prior to October 1, 1990 were
audited by other independent accountants whose reports are not included in the
Annual Report. Expense and income ratios and portfolio turnover rates have been
annualized for periods of less than one year. Total returns for periods of less
than one year are not annualized. A DETAILED EXPLANATION OF THE FINANCIAL
HIGHLIGHTS CAN BE FOUND ON PAGE 7.

<TABLE>
<CAPTION>
Janus Fund
1995 1994 1993 1992 1991
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $ 19.62 $ 20.81 $18.86 $18.27 $13.25
Income from investment operations:
2. Net investment income 0.16 0.17 0.26 0.23 0.25
3. Net gains or (losses) on securities (both realized and unrealized) 3.99 (0.03) 2.88 1.46 5.09
4. Total from investment operations 4.15 0.14 3.14 1.69 5.34
Less distributions:
5. Dividends (from net investment income) (.01) (0.39)(1) (0.29) (0.19) (0.31)
6. Distributions (from capital gains) (.39) (0.94) (0.90) (0.91) (0.01)
7. Total distributions (.40) (1.33) (1.19) (1.10) (0.32)
8. Net asset value, end of period $ 23.37 $ 19.62 $20.81 $18.86 $18.27
9. Total return 21.62% 0.75% 17.41% 9.35% 40.95%
10. Net assets, end of period (in millions) $11,963 $9,647 $9,098 $4,989 $2,598
11. Ratio of expenses to average net assets 0.87%(2) 0.91% 0.92% 0.97% 0.98%
12. Ratio of net investment income to average net assets 1.25% 1.12% 1.55% 1.54% 1.77%
13. Portfolio turnover rate 118% 139% 127% 153% 132%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
Janus Fund
1990 1989 1988 1987 1986
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $16.36 $12.11 $12.39 $14.77 $13.42
Income from investment operations:
2. Net investment income 0.25 0.22 0.60 0.19 0.42
3. Net gains or (losses) on securities (both realized and unrealized) (0.67) 4.59 1.05 0.30 2.20
4. Total from investment operations (0.42) 4.81 1.65 0.49 2.62
Less distributions:
5. Dividends (from net investment income) (0.19) (0.56) (0.32) (0.38) (0.47)
6. Distributions (from capital gains) (2.50) -- (1.61) (2.49) (0.80)
7. Total distributions (2.69) (0.56) (1.93) (2.87) (1.27)
8. Net asset value, end of period $13.25 $16.36 $12.11 $12.39 $14.77
9. Total return (3.68%) 41.67% 15.83% 4.14% 20.66%
10. Net assets, end of period (in millions) $1,049 $ 673 $ 391 $ 387 $ 474
11. Ratio of expenses to average net assets 1.02% 0.92% 0.98% 1.01% 1.00%
12. Ratio of net investment income to average net assets 2.11% 1.68% 4.99% 1.55% 2.82%
13. Portfolio turnover rate 307% 205% 175% 214% 254%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Distribution in excess of financial statement income of $0.02.

(2) The Fund's expenses may be reduced through the use of brokerage commissions
and uninvested cash balances earning interest with the Fund's custodian.
The expense ratio for the fiscal period ended October 31, 1995, does not
reflect expense reductions, which reduced the expense ratio to 0.86%.

<TABLE>
<CAPTION>
JANUS TWENTY FUND
1995 1994 1993 1992(1) 1992(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $24.24 $25.85 $22.75 $22.17 $18.88
Income from investment operations:
2. Net investment income .01 0.16 0.17 0.09 0.11
3. Net gains or (losses) on securities (both realized and unrealized) 5.94 (1.07) 3.31 0.49 3.62
4. Total from investment operations 5.95 (0.91) 3.48 0.58 3.73
Less distributions:
5. Dividends (from net investment income) (.07) (0.25) (0.18) -- (0.02)
6. Distributions (from capital gains) -- (0.45) (0.20) -- (0.42)
7. Total distributions (.07) (0.70) (0.38) -- (0.44)
8. Net asset value, end of period $30.12 $24.24 $25.85 $22.75 $22.17
9. Total return 24.67% (3.52%) 15.39% 2.62% 19.60%
10. Net assets, end of period (in millions) $2,996 $2,743 $3,749 $2,434 $2,081
11. Ratio of expenses to average net assets 1.00%(3) 1.02% 1.05% 1.12% 1.01%
12. Ratio of net investment income to average net assets 0.62% 0.57% 0.87% 1.27% 1.08%
13. Portfolio turnover rate 147% 102% 99% 79% 83%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
JANUS TWENTY FUND
1991(2) 1990(2) 1989(2) 1988(2) 1987(2) 1986(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $16.01 $13.05 $ 9.66 $13.69 $14.27 $11.57
Income from investment operations:
2. Net investment income 0.16 0.05 0.46 0.42 0.30 0.19
3. Net gains or (losses) on securities (both realized and unrealized) 2.90 3.35 3.73 (2.86) 0.74 3.05
4. Total from investment operations 3.06 3.40 4.19 (2.44) 1.04 3.24
Less distributions:
5. Dividends (from net investment income) (0.19) (0.02) (0.80) (0.41) (0.25) (0.23)
6. Distributions (from capital gains) -- (0.42) -- (1.18) (1.37) (0.31)
7. Total distributions (0.19) (0.44) (0.80) (1.59) (1.62) (0.54)
8. Net asset value, end of period $18.88 $16.01 $13.05 $ 9.66 $13.69 $14.27
9. Total return 19.43% 26.36% 45.89% (17.13%) 8.66% 29.06%
10. Net assets, end of period (in millions) $ 556 $ 175 $ 20 $ 13 $ 19 $ 10
11. Ratio of expenses to average net assets 1.07% 1.32% 1.88% 1.70% 1.79% 2.00%
12. Ratio of net investment income to average net assets 1.30% 1.28% 0.68% 3.35% 2.98% 3.55%
13. Portfolio turnover rate 163% 228% 220% 317% 202% 152%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from June 1, 1992 to October 31, 1992.
(2) Fiscal year ended on May 31st of each year.

(3) The Fund's expenses may be reduced through the use of brokerage commissions
and uninvested cash balances earning interest with the Fund's custodian.
The expense ratio for the fiscal period ended October 31, 1995, does not
reflect expense reductions, which reduced the expense ratio to 0.99%.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
4
<PAGE>

<TABLE>
<CAPTION>
Janus Janus
Enterprise Mercury
Fund Fund
1995 1994 1993 1992(1) 1995 1994 1993(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $24.43 $21.87 $17.09 $15.00 $ 14.12 $11.70 $10.00
Income from investment operations:
2. Net investment income (loss) 0.52 (0.06) 0.04 -- 0.16 0.02 (0.01)
3. Net gains or (losses) on securities
(both realized and unrealized) 3.09 3.18 4.76 2.09 3.37 2.40 1.71
4. Total from investment operations 3.61 3.12 4.80 2.09 3.53 2.42 1.70
Less distributions:
5. Dividends (from net investment income) (0.52) (0.02) (0.02) -- (0.16) -- --
6. Distributions (from capital gains) (0.38) (0.54) -- -- (0.11) -- --
7. Total distributions (0.90) (0.56) (0.02) -- (0.27) -- --
8. Net asset value, end of period $27.14 $24.43 $21.87 $17.09 $ 17.38 $14.12 $11.70
9. Total return 15.46% 14.56% 28.09% 13.93% 25.53% 20.68% 17.00%
10. Net assets, end of period (in millions) $ 459 $ 370 $ 239 $ 8 $ 1,521 $ 596 $ 113
11. Ratio of expenses to average net assets 1.26%(3) 1.25% 1.36% 2.50% 1.14%(3) 1.33% 1.75%
12. Ratio of net investment income
to average net assets 0.02% (0.32%) 0.14% (0.81%) 0.50% 0.25% (0.40%)
13. Portfolio turnover rate 194% 193% 201% 53% 201% 283% 151%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from September 1, 1992 (inception) to October 31, 1992.
(2) Fiscal period from May 3, 1993 (inception) to October 31, 1993.

<TABLE>
<CAPTION>
Janus Janus
Worldwide Overseas
Fund Fund
1995 1994 1993 1992 1991(1) 1995 1994(2)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $27.00 $24.16 $18.95 $17.45 $15.00 $10.36 $10.00
Income from investment operations:
2. Net investment income (loss) 0.81 0.15 0.14 0.16 -- 0.12 (0.02)
3. Net gains or (losses) on securities
(both realized and unrealized) 1.39 3.34 5.29 1.39 2.45 1.10 0.38
4. Total from investment operations 2.20 3.49 5.43 1.55 2.45 1.22 0.36
Less distributions:
5. Dividends (from net investment income) (0.54) (0.27) (0.22) -- -- -- --
6. Distributions (from capital gains) (1.01) (0.38) -- (0.05) -- -- --
7. Total distributions (1.55) (0.65) (0.22) (0.05) -- -- --
8. Net asset value, end of period $27.65 $27.00 $24.16 $18.95 $17.45 $11.58 $10.36
9. Total return 8.89% 14.76% 28.79% 9.20% 16.00% 11.78% 3.60%
10. Net assets, end of period (in millions) $1,804 $1,587 $ 755 $ 161 $ 18 $ 111 $ 64
11. Ratio of expenses to average net assets 1.24%(3) 1.12% 1.32% 1.73% 2.50% 1.76%(3) 2.16%
12. Ratio of net investment income
to average net assets 0.99% 0.42% 0.92% 1.74% 0.02% 0.36% (0.64%)
13. Portfolio turnover rate 142% 158% 124% 147% 40% 188% 181%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from May 15, 1991 (inception) to October 31, 1991.
(2) Fiscal period from May 2, 1994 (inception) to October 31, 1994.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
5
<PAGE>

<TABLE>
<CAPTION>
Janus Growth and Income Fund
1995 1994 1993 1992 1991(1)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $14.69 $15.24 $12.95 $12.13 $10.00
Income from investment operations:
2. Net investment income 0.11 0.19 0.14 0.17 0.02
3. Net gains or (losses) on securities
(both realized and unrealized) 3.43 (0.31) 2.29 0.80 2.13
4. Total from investment operations 3.54 (0.12) 2.43 0.97 2.15
Less distributions:
5. Dividends (from net investment income) (0.10) (0.10) (0.14) (0.15) (0.02)
6. Distributions (from capital gains) -- (0.33) -- -- --
7. Total distributions (0.10) (0.43) (0.14) (0.15) (0.02)
8. Net asset value, end of period $18.13 $14.69 $15.24 $12.95 $12.13
9. Total return 24.20% (0.76%) 18.81% 7.98% 21.50%
10. Net assets, end of period (in millions) $ 583 $ 490 $ 519 $ 244 $ 56
11. Ratio of expenses to average net assets 1.19%(3) 1.22% 1.28% 1.52% 2.33%
12. Ratio of net investment income
to average net assets 1.11% 1.26% 1.13% 1.61% 0.76%
13. Portfolio turnover rate 195% 123% 138% 120% 14%
- --------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>

<CAPTION>
Janus Balanced Fund
1995 1994 1993 1992(2)
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Net asset value, beginning of period $12.17 $12.23 $10.64 $10.00
Income from investment operations:
2. Net investment income 0.61 0.27 0.19 --
3. Net gains or (losses) on securities
(both realized and unrealized) 1.52 (0.09) 1.56 0.64
4. Total from investment operations 2.13 0.18 1.75 0.64
Less distributions:
5. Dividends (from net investment income) (0.58) (0.24) (0.16) --
6. Distributions (from capital gains) -- -- -- --
7. Total distributions (0.58) (0.24) (0.16) --
8. Net asset value, end of period $13.72 $12.17 $12.23 $10.64
9. Total return 18.26% 1.51% 16.54% 6.40%
10. Net assets, end of period (in millions) $ 125 $ 94 $ 73 $ 2
11. Ratio of expenses to average net assets 1.35%(3) 1.42% 1.70% 2.50%
12. Ratio of net investment income
to average net assets 2.52% 2.28% 2.15% (0.12%)
13. Portfolio turnover rate 185% 167% 131% 130%
- -----------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from May 15, 1991 (inception) to October 31, 1991.
(2) Fiscal period from September 1, 1992 (inception) to October 31, 1992.

(3) The Fund's expenses may be reduced through use of brokerage commissions and
uninvested cash balances earning interest with the Fund's custodian. The
expense ratio for the fiscal period ended October 31, 1995, does not
reflect expense reductions, which reduced the expense ratio to 1.17% for
Janus Growth and Income Fund and 1.32% for Janus Balanced Fund.

<TABLE>
<CAPTION>
Janus Flexible Income Fund
1995 1994 1993 1992(1) 1991(2) 1990(2)
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $ 8.96 $10.03 $ 9.26 $ 9.09 $ 8.01 $ 9.35
Income from investment operations:
2. Net investment income 0.72 0.74 0.77 0.68 0.68 0.95
3. Net gains or (losses) on securities
(both realized and unrealized) 0.59 (0.86) 0.79 0.15 1.29 (1.38)
4. Total from investment operations 1.31 (0.12) 1.56 0.83 1.97 (0.43)
Less distributions:
5. Dividends (from net investment income) (0.72) (0.72) (0.77) (0.66) (0.72) (0.91)
6. Distributions (from capital gains) -- (0.23) (0.02) -- (0.17) --
7. Total distributions (0.72) (0.95) (0.79) (0.66) (0.89) (0.91)
8. Net asset value, end of period $ 9.55 $ 8.96 $10.03 $ 9.26 $ 9.09 $ 8.01
9. Total return 15.35% (1.26%) 17.48% 9.43% 25.98% (4.62%)
10. Net assets, end of period (in millions) $ 580 $ 377 $ 473 $ 205 $ 72 $ 14
11. Ratio of expenses to average net assets 0.96%(5) 0.93% 1.00%(4) 1.00%(4) 1.00%(4) 1.00%(4)
12. Ratio of net investment income
to average net assets 7.91% 7.75% 7.96% 8.98% 9.38% 11.24%
13. Portfolio turnover rate 250% 137% 201% 210% 88% 96%
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
Janus Flexible Income Fund
1989(2) 1988(2) 1987(3)
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Net asset value, beginning of period $ 9.99 $ 9.92 $10.00
Income from investment operations:
2. Net investment income 0.97 0.92 0.40
3. Net gains or (losses) on securities
(both realized and unrealized) (0.56) 0.09 (0.07)
4. Total from investment operations 0.41 1.01 0.33
Less distributions:
5. Dividends (from net investment income) (0.97) (0.92) (.40)
6. Distributions (from capital gains) (0.08) (0.02) (.01)
7. Total distributions (1.05) (0.94) (0.41)
8. Net asset value, end of period $ 9.35 $ 9.99 $ 9.92
9. Total return 4.12% 10.70% 3.40%
10. Net assets, end of period (in millions) $ 18 $ 10 $ 4
11. Ratio of expenses to average net assets 1.00%(4) 1.00%(4) 1.00%(4)
12. Ratio of net investment income
to average net assets 10.00% 9.32% 8.52%
13. Portfolio turnover rate 75% 76% 130%
- ---------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from January 1, 1992 to October 31, 1992.
(2) Fiscal year ended on December 31st of each year.
(3) Fiscal period from July 2, 1987 (inception) to December 31, 1987.

(4) The ratio of expenses to average net assets was 1.01% in 1993, 1.21% in
1992 and 1.74% in 1991 before waiver of certain Fund expenses. The ratio
was 2% in prior years.
(5) The Fund's expenses may be reduced through the use of brokerage commissions
and uninvested cash balances earning interest with the Fund's custodian.
The expense ratio for the fiscal period ended October 31, 1995, does not
reflect expense reductions, which had a de minimis effect on the expense
ratio (less than 0.01%).

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
6
<PAGE>

<TABLE>
<CAPTION>
Janus
Intermediate Government
Securities Fund
1995 1994 1993 1992(1) 1991(2)
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $ 4.81 $ 5.16 $ 5.36 $ 5.35 $ 5.00
Income from investment operations:
2. Net investment income 0.30 0.25 0.22 0.22 0.13
3. Net gains or (losses) on securities
(both realized and unrealized) 0.17 (0.35) (0.09) 0.01 0.35
4. Total from investment operations 0.47 (0.10) 0.13 0.23 0.48
Less distributions:
5. Dividends (from net investment income) (0.30) (0.25) (0.22) (0.22) (0.13)
6. Distributions (from capital gains) -- -- (0.11) -- --
7. Total distributions (0.30) (0.25) (0.33) (0.22) (0.13)
8. Net asset value, end of period $ 4.98 $ 4.81 $ 5.16 $ 5.36 $ 5.35
9. Total return 10.19% (1.89%) 2.68% 4.48% 9.74%
10. Net assets, end of period (in millions) $ 38 $ 37 $ 65 $ 70 $ 15
11. Ratio of expenses to average net assets 0.65%(5,9) 0.65%(5) 0.91%(5,8) 1.00%(5) 1.00%(5)
12. Ratio of net investment income
to average net assets 6.24% 4.97% 4.27% 4.95% 5.93%
13. Portfolio turnover rate 252% 304% 371% 270% 0%
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
Janus
Short-Term
Bond Fund
1995 1994 1993 1992(3)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Net asset value, beginning of period $ 2.87 $ 3.02 $ 2.98 $3.00
Income from investment operations:
2. Net investment income 0.18 0.18 0.14 0.01
3. Net gains or (losses) on securities
(both realized and unrealized) (0.03) (0.15) 0.04 (0.02)
4. Total from investment operations 0.15 0.03 0.18 (0.01)
Less distributions:
5. Dividends (from net investment income) (0.18) (0.17) (0.14) (0.01)
6. Distributions (from capital gains) -- (0.01) -- --
7. Total distributions (0.18) (0.18) (0.14) (0.01)
8. Net asset value, end of period $ 2.84 $ 2.87 $ 3.02 $2.98
9. Total return 5.55% 1.26% 6.17% (0.19%)
10. Net assets, end of period (in millions) $ 46 $ 54 $ 76 $ 3
11. Ratio of expenses to average net assets 0.66%(6,9) 0.65%(6) 0.83%(6,8) 1.00%(6)
12. Ratio of net investment income
to average net assets 6.67% 6.08% 4.86% 3.22%
13. Portfolio turnover rate 337% 346% 372% 7%
- ----------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
Janus
Federal Tax-
Exempt Fund
1995 1994 1993(4)
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Net asset value, beginning of period $ 6.45 $ 7.30 $ 7.00
Income from investment operations:
2. Net investment income 0.36 0.36 0.14
3. Net gains or (losses) on securities
(both realized and unrealized) 0.43 (0.83) 0.30
4. Total from investment operations 0.79 (0.47) 0.44
Less distributions:
5. Dividends (from net investment income) (0.36) (0.36) (0.14)
6. Distributions (from capital gains) -- (0.02) --
7. Total distributions (0.36) (0.38) (0.14)
8. Net asset value, end of period $ 6.88 $ 6.45 $ 7.30
9. Total return 12.60% (6.62%) 6.33%
10. Net assets, end of period (in millions) $ 33 $ 26 $ 27
11. Ratio of expenses to average net assets 0.70%(7,9) 0.65%(7) 0.75%(7,8)
12. Ratio of net investment income
to average net assets 5.43% 5.20% 4.58%
13. Portfolio turnover rate 164% 160% 124%
- --------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from January 1, 1992 to October 31, 1992.
(2) Fiscal period from July 26, 1991 (inception) to December 31, 1991.
(3) Fiscal period from September 1, 1992 (inception) to October 31, 1992.
(4) Fiscal period from May 3, 1993 (inception) to October 31, 1993.

(5) The ratio of expenses to average net assets was 1.22% in 1995, 1.15% in
1994, 1.09% in 1993, 1.32% in 1992 and 1.39% in 1991 before waiver of
certain Fund expenses.
(6) The ratio of expenses to average net assets was 1.23% in 1995, 1.15% in
1994, 1.40% in 1993 and 2.50% in 1992 before waiver of certain Fund
expenses.
(7) The ratio of expenses to average net assets was 1.31% in 1995, 1.41% in
1994 and 1.60% in 1993 before waiver of certain Fund expenses.

(8) The ratio of expenses to average net assets reflects the Fund's previous
expense limit of 1.00%. This limit was reduced to .65% as of August 1,
1993.
(9) Expense ratios for the fiscal year ended October 31, 1995, do not reflect
expense reductions from interest earned on invested cash balances held with
the Funds' custodian, which reduced the expense ratio of each Fund to
0.65%.

UNDERSTANDING THE FINANCIAL HIGHLIGHTS

This section is designed to help you better understand the information
summarized in the Financial Highlights tables. The tables contain important
historical operating information that may be useful in making your investment
decision or understanding how your investment has performed. The Funds' Annual
Reports contain additional information about each Fund's performance, including
a comparison to an appropriate securities index. For a copy of your Fund's
Annual Report, call 1-800-525-8983.

Net asset value ("NAV") is the value of a single share of a Fund. It is computed
by adding the value of all of a Fund's investments and other assets, subtracting
any liabilities and dividing the result by the number of shares outstanding. The
difference between line 1 and line 8 in the Financial Highlights tables
represents the change in value of a Fund's shares over the fiscal period, but
not its total return.

Net investment income is the per share amount of dividends and interest income
earned on securities held by a Fund, less Fund expenses. Dividends (from net
investment income) is the per share amount that a Fund paid from net investment
income.

Net gains or (losses) on securities is the per share increase or decrease in
value of the securities a Fund holds. A gain (or loss) is realized when
securities are sold. A gain (or loss) is unrealized when securities increase or
decrease in value but are not sold. Distributions (from capital gains) is the
per share amount that a Fund paid from net realized gains.

Total return is the percentage increase or decrease in the value of an
investment over a stated period of time. A total return percentage includes both
changes in NAV and income. For the purposes of calculating total return, it is
assumed that dividends and distributions are reinvested at the NAV on the day of
the distribution. A FUND'S TOTAL RETURN CANNOT BE COMPUTED DIRECTLY FROM THE
FINANCIAL HIGHLIGHTS TABLES.

Ratio of expenses to average net assets is the total of a Fund's operating
expenses divided by its average net assets for the stated period.

Ratio of net investment income to average net assets is a Fund's net investment
income divided by its average net assets for the stated period.

Portfolio turnover rate is a measure of the amount of a Fund's buying and
selling activity. It is computed by dividing total purchases or sales, whichever
is less, by the average monthly market value of a Fund's portfolio securities.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
7
<PAGE>

THE FUNDS IN DETAIL

To help you decide which Fund is appropriate for you, this section takes a
closer look at the Funds' investment objectives, policies and the securities in
which they invest. Please carefully review the "Additional Risk Factors" section
of this Prospectus for a more detailed discussion of the risks associated with
certain investment techniques, as well as the risk spectrum on page 2. Appendix
A contains a more detailed description of investment terms used throughout this
Prospectus. You should carefully consider your own investment goals, time
horizon and risk tolerance before investing in a Fund.

Policies that are noted as "fundamental" cannot be changed without a shareholder
vote. All other policies, including each Fund's investment objective, are not
fundamental and may be changed by the Funds' Trustees without a shareholder
vote. You will be notified of any such changes that are material. If there is a
material change in a Fund's objective or policies, you should consider whether
that Fund remains an appropriate investment for you.

THE JANUS GROWTH FUNDS ARE DESIGNED FOR LONG-TERM INVESTORS WHO SEEK GROWTH OF
CAPITAL ONLY AND WHO CAN TOLERATE THE GREATER RISKS ASSOCIATED WITH COMMON STOCK
INVESTMENTS.

GROWTH FUNDS

Investment Objective: ........................................ Growth of Capital
Primary Holdings: ................................................ Common Stocks
Shareholder's Investment Horizon: .................................... Long-Term

- --------------------------------------------------------------------------------
A SHAREHOLDER'S INVESTMENT HORIZON IS THE AMOUNT OF TIME YOU SHOULD PLAN TO HOLD
YOUR INVESTMENT IN A FUND TO MAXIMIZE THE POTENTIAL FOR REALIZING THE FUND'S
OBJECTIVE.
- --------------------------------------------------------------------------------

JANUS FUND

The investment objective of this Fund is long-term growth of capital in a manner
consistent with the preservation of capital. It is a diversified fund that
pursues its objective by investing in common stocks of companies of any size.
Janus Fund was first offered to the public in 1970 and has the largest asset
base of the Funds. This Fund generally invests in larger, more established
issuers.

JANUS TWENTY FUND

The investment objective of this Fund is long-term growth of capital. It is a
non-diversified fund that pursues its objective by normally concentrating its
investments in a core position of 20-30 common stocks.

JANUS ENTERPRISE FUND

The investment objective of this Fund is long-term growth of capital. It is a
nondiversified fund that pursues its investment objective by normally investing
at least 50% of its equity assets in securities issued by medium-sized
companies. Medium-sized companies are those whose market capitalizations fall
within the range of companies in the S&P MidCap 400 Index (the "MidCap Index").
Companies whose capitalization falls outside this range after the Fund's initial
purchase continue to be considered medium-sized companies for the purpose of
this policy. As of December 29, 1995, the MidCap Index included companies with
capitalizations between approximately 118 million to 7.5 billion. The range of
the MidCap Index is expected to change on a regular basis. Subject to the above
policy, the Fund may also invest in smaller or larger issuers.

JANUS MERCURY FUND

The investment objective of this Fund is long-term growth of capital. It is a
nondiversified fund that pursues its objective by investing in common stocks of
issuers of any size, which may include larger well-established issuers and/or
smaller emerging growth companies.

JANUS WORLDWIDE FUND

The investment objective of this Fund is long-term growth of capital in a manner
consistent with the preservation of capital. It is a diversified fund that
pursues its objective primarily through investments in common stocks of foreign
and domestic issuers. The Fund has the flexibility to invest on a worldwide
basis in companies and organizations of any size, regardless of country of
organization or place of principal business activity. Janus Worldwide Fund
normally invests in issuers from at least five different countries, including
the United States. The Fund may at times invest in fewer than five countries or
even a single country.

JANUS OVERSEAS FUND

The investment objective of this Fund is long-term growth of capital. It is a
diversified fund that pursues its objective primarily through investments in
common stocks of issuers located outside the United States. The Fund has the
flexibility to invest on a worldwide basis in companies and other organizations
of any size, regardless of country of organization or place of principal
business activity. The Fund normally invests at least 65% of its total assets in
securities of issuers from at least five different countries, excluding the
United States. Although the Fund intends to invest substantially all of its
assets in issuers located outside the United States, it may at times invest in
U.S. issuers and it may at times invest all of its assets in fewer than five
countries or even a single country.

TYPES OF INVESTMENTS

Each of the Growth Funds invests primarily in common stocks of foreign and
domestic companies. However, the percentage of each Fund's assets invested in
common stocks will vary and each Fund may at times hold substantial positions in
cash equivalents or interest bearing securities. See "General Portfolio
Policies" on page 13. Each Fund may invest to a lesser degree in other types of
securities including preferred stock, warrants, convertible securities and debt
securities when its portfolio manager perceives an

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
8
<PAGE>

opportunity for capital growth from such securities or to receive a return on
idle cash. Debt and other income-producing securities that the Funds may
purchase include those described with respect to Janus Flexible Income Fund on
pages 11-12, except that the Growth Funds' investments in high-yield/high-risk
securities will be less than 35% of net assets and investments in mortgage- and
asset-backed securities will not exceed 25% of assets.

Although Janus Worldwide Fund and Janus Overseas Fund are committed to foreign
investing, all of the Growth Funds may invest without limit in foreign equity
and debt securities. The Funds may invest directly in foreign securities
denominated in a foreign currency and not publicly traded in the United States.
Other ways of investing in foreign securities include depositary receipts or
shares, and passive foreign investment companies. Each of the Growth Funds may
use futures, options and other derivatives for hedging purposes or as a means of
enhancing return. See "Additional Risk Factors" on pages 14-15 for a discussion
of the risks associated with foreign investing and derivatives. Some securities
that the Funds purchase may be issued on a when-issued, delayed delivery or
forward commitment basis.

THE FOLLOWING QUESTIONS ARE DESIGNED TO HELP YOU BETTER UNDERSTAND AN INVESTMENT
IN THE JANUS GROWTH FUNDS.

HOW ARE COMMON STOCKS SELECTED?

Each of the Growth Funds invests substantially all of its assets in common
stocks to the extent its portfolio manager believes that the relevant market
environment favors profitable investing in those securities. Portfolio managers
generally take a "bottom up" approach to building their portfolios. In other
words, they seek to identify individual companies with earnings growth potential
that may not be recognized by the market at large. Although themes may emerge in
any Fund, securities are generally selected without regard to any defined
industry sector or other similarly defined selection procedure. Realization of
income is not a significant investment consideration. Any income realized on a
Growth Fund's investments will be incidental to its objective.

- --------------------------------------------------------------------------------

ARE THE SAME CRITERIA USED TO SELECT FOREIGN SECURITIES?

Generally, yes. Portfolio managers seek companies with earnings growth
potential, regardless of country of organization or place of principal business
activity. Foreign securities are generally selected on a stock-by-stock basis
without regard to any defined allocation among countries or geographic regions.
However, certain factors such as expected levels of inflation, government
policies influencing business conditions, the outlook for currency
relationships, and prospects for economic growth among countries, regions or
geographic areas may warrant greater consideration in selecting foreign
securities. See "Additional Risk Factors" on pages 14-15.

- --------------------------------------------------------------------------------

WHAT IS THE MAIN RISK OF INVESTING IN A COMMON STOCK FUND?

The fundamental risk associated with any common stock fund is the risk that the
value of the stocks it holds might decrease. Stock values may fluctuate in
response to the activities of an individual company or in response to general
market and/or economic conditions. Historically, common stocks have provided
greater long-term returns and have entailed greater short-term risks than other
investment choices. Smaller or newer issuers are more likely to realize more
substantial growth as well as suffer more significant losses than larger or more
established issuers. Investments in such companies can be both more volatile and
more speculative. See "Additional Risk Factors" on pages 14-15.

- --------------------------------------------------------------------------------

WHAT IS MEANT BY "MARKET CAPITALIZATION"?

Market capitalization is the most commonly used measure of the size and value of
a company. It is computed by multiplying the current market price of a share of
the company's stock by the total number of its shares outstanding. As noted
previously, market capitalization is an important investment criteria for Janus
Enterprise Fund. Although the other Growth Funds offered by this Prospectus do
not emphasize companies of any particular size, Funds with a larger asset base
(e.g., Janus Fund) are more likely to invest in larger, more established
issuers. Janus Venture Fund, which is closed to new investors and is not offered
by this Prospectus, emphasizes small-sized companies (companies with market
capitalizations of less than $1 billion or annual gross revenues of less than
$500 million).

- --------------------------------------------------------------------------------

HOW DOES A DIVERSIFIED FUND DIFFER FROM A NONDIVERSIFIED FUND?

Diversification is a means of reducing risk by investing a Fund's assets in a
broad range of stocks or other securities. A "nondiversified" fund has the
ability to take larger positions in a smaller number of issuers. Because the
appreciation or depreciation of a single stock may have a greater impact on the
NAV of a nondiversified fund, its share price can be expected to fluctuate more
than a comparable diversified fund. Janus Twenty Fund, Janus Enterprise Fund and
Janus Mercury Fund are nondiversified funds. See the risk spectrum on page 2 and
"General Portfolio Policies" on page 13.

- --------------------------------------------------------------------------------

HOW DO THE GROWTH FUNDS TRY TO REDUCE RISK?

Diversification of a Fund's assets reduces the effect of any single holding on
its overall portfolio value. A Fund may also use futures, options and other
derivative instruments to protect its portfolio from movements in securities
prices and interest rates. The Funds may use a variety of currency hedging
techniques, including forward currency contracts, to manage exchange rate risk
when investing directly in foreign markets. See "Additional Risk Factors" on
pages 14-15. In addition, to the extent that a Fund holds a larger cash
position, it may not participate in market declines to the same extent as if the
Fund remained more fully invested in common stocks.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
9
<PAGE>

THE JANUS COMBINATION FUNDS ARE DESIGNED FOR INVESTORS WHO PRIMARILY SEEK GROWTH
OF CAPITAL WITH A DEGREE OF EMPHASIS ON INCOME. THESE FUNDS ARE NOT DESIGNED FOR
INVESTORS WHO DESIRE A CONSISTENT LEVEL OF INCOME.

COMBINATION FUNDS

Investment Objective: ............... Growth of Capital; Some Emphasis on Income
Primary Holdings: ................ Common Stocks and Income-Producing Securities
Shareholder's Investment Horizon: .................................... Long-Term

JANUS GROWTH AND INCOME FUND

The investment objective of this Fund is long-term capital growth and current
income. It is a diversified fund that, under normal circumstances, pursues its
objective by investing up to 75% of its assets in equity securities selected
primarily for their growth potential and at least 25% of its assets in
securities selected primarily for their income potential. The Fund normally
emphasizes the growth component. However, in unusual circumstances, this Fund
may reduce the growth component of its portfolio to 25% of its assets.

JANUS BALANCED FUND

The investment objective of this Fund is long-term capital growth, consistent
with preservation of capital and balanced by current income. It is a diversified
fund that, under normal circumstances, pursues its objective by investing 40-60%
of its assets in securities selected primarily for their growth potential and
40-60% of its assets in securities selected primarily for their income
potential. This Fund normally invests at least 25% of its assets in fixed-income
senior securities, which include debt securities and preferred stocks.

TYPES OF INVESTMENTS

The Combination Funds may invest in the types of investments previously
described under "Growth Funds" on pages 8-9. The Funds may also invest in the
types of income-producing securities described on pages 11-12 for Janus Flexible
Income Fund except that their investments in junk bonds will be less than 35% of
net assets and investments in mortgage- and asset-backed securities will not
exceed 25% of assets.

THE FOLLOWING QUESTIONS ARE DESIGNED TO HELP YOU BETTER UNDERSTAND AN INVESTMENT
IN THE JANUS COMBINATION FUNDS.

HOW ARE ASSETS ALLOCATED BETWEEN THE GROWTH AND INCOME COMPONENT OF A
COMBINATION FUND'S PORTFOLIO?

The Combination Funds may invest in a combination of common stocks, preferred
stocks, convertible securities, debt securities and other fixed-income
securities. A Combination Fund may shift assets between the growth and income
components of its portfolio based on its portfolio manager's analysis of
relevant market, financial and economic conditions. If a portfolio manager
believes that growth securities will provide better returns than the yields then
available or expected on income-producing securities, then that Fund will place
a greater emphasis on the growth component.

WHAT TYPES OF SECURITIES MAKE UP THE GROWTH COMPONENT OF THE COMBINATION FUNDS?

The growth component of the Combination Funds is expected to consist primarily
of common stocks. The selection criteria for common stocks are described on page
9. Because income is a part of the investment objective of the Combination
Funds, a portfolio manager may consider dividend-paying characteristics to a
greater degree in selecting equity securities for these Funds. The Combination
Funds may also find opportunities for capital growth from debt securities
because of anticipated changes in interest rates, credit standing, currency
relationships or other factors.

- --------------------------------------------------------------------------------

WHAT TYPES OF SECURITIES MAKE UP THE INCOME COMPONENT OF THE COMBINATION FUNDS?

The income component of each Combination Fund may consist of all types of
income-producing securities, including common stocks selected primarily for
their dividend payments, preferred stocks, convertible securities and all types
of debt securities. Income-producing securities are used to produce a more
consistent total return than a portfolio manager may attain through investing
solely in growth stocks. However, the Combination Funds are not designed to
produce a consistent level of income.

- --------------------------------------------------------------------------------

HOW DO THE COMBINATION FUNDS DIFFER FROM EACH OTHER?

Janus Growth and Income Fund places a greater emphasis on the growth objective.
Because it generally invests more heavily in growth stocks than Janus Balanced
Fund, its share price can be expected to fluctuate more. Janus Growth and Income
Fund has historically derived a greater portion of its income from
dividend-paying common stocks, while Janus Balanced Fund invests to a greater
degree in debt securities and preferred stock.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
10
<PAGE>

THE JANUS FIXED-INCOME FUNDS ARE DESIGNED FOR THOSE INVESTORS WHO PRIMARILY SEEK
CURRENT INCOME.

FIXED-INCOME FUNDS

Investment Objective:
Janus Flexible Income Fund ...................................... Total Return
Others ................................................................ Income
Primary Holdings: .................................. Income-Producing Securities
Shareholder's Investment Horizon:
Janus Short-Term Bond Fund ....................... Short- to Intermediate-Term
Others ............................................ Intermediate- to Long-Term

JANUS FLEXIBLE INCOME FUND

The investment objective of this Fund is to obtain maximum total return,
consistent with preservation of capital. This Fund pursues its objective
primarily through investments in income-producing securities. Total return is
expected to result from a combination of current income and capital
appreciation, although income will normally be the dominant component of total
return. As a fundamental policy, this Fund will invest at least 80% of its
assets in income-producing securities.

Janus Flexible Income Fund may invest in a wide variety of income-producing
securities including corporate bonds and notes, government securities, preferred
stock, income-producing common stocks, debt securities that are convertible or
exchangeable into equity securities, and debt securities that carry with them
the right to acquire equity securities as evidenced by warrants attached to or
acquired with the securities. The Fund may invest to a lesser degree in common
stocks, other equity securities or debt securities that are not currently paying
dividends or interest. The Fund may purchase securities of any maturity and
quality and the average maturity and quality of its portfolio may vary
substantially.

Janus Flexible Income Fund may invest without limit in foreign securities,
including those of corporate and government issuers. The Fund may invest without
limit in high-yield/high-risk securities and may have substantial holdings of
such securities. The risks of foreign securities and high-yield securities are
described under "Additional Risk Factors" on pages 14-15.

JANUS INTERMEDIATE GOVERNMENT SECURITIES FUND

The investment objective of this Fund is to seek as high a level of current
income as is consistent with preservation of capital. This Fund pursues its
objective by investing primarily in obligations of the U.S. government and its
agencies and instrumentalities. Because of this emphasis, capital appreciation
is not a significant investment consideration. This Fund may invest up to 20% of
its net assets in commercial paper of U.S. issuers rated in the highest category
by a nationally recognized statistical rating agency. Under normal
circumstances, it is expected that this Fund's dollar-weighted average portfolio
maturity will be greater than three years and less than ten years.

JANUS SHORT-TERM BOND FUND

The investment objective of this Fund is to seek as high a level of current
income as is consistent with preservation of capital. This Fund pursues its
objective by investing primarily in short- and intermediate-term fixed-income
securities. Under normal circumstances, it is expected that this Fund's
dollar-weighted average portfolio maturity will not exceed three years .

Janus Short-Term Bond Fund will normally invest at least 65% of its assets in
debt securities. Subject to this policy and subject to its maturity limits, the
Fund may invest in the types of securities previously described under Janus
Flexible Income Fund except that its investments in high-yield/high-risk
securities will not exceed 35% of net assets.

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JANUS FEDERAL TAX-EXEMPT FUND IS DESIGNED FOR INVESTORS WHO SEEK A HIGHER
AFTER-TAX YIELD THAN COMPARABLE INVESTING IN TAXABLE SECURITIES.

JANUS FEDERAL TAX-EXEMPT FUND

The investment objective of this Fund is to seek as high a level of current
income exempt from federal income tax as is consistent with preservation of
capital. This Fund pursues its objective by investing primarily in municipal
obligations of any maturity whose interest is exempt from federal income tax.
Because of this emphasis, capital appreciation is not a significant investment
consideration. However, to the extent that capital gains are realized, they are
subject to federal income tax. As a fundamental policy, this Fund will normally
invest at least 80% of its net assets in securities whose interest is exempt
from federal income tax, including the federal alternative minimum tax.

Municipal securities in which the Fund may invest include general obligation
bonds, revenue bonds, industrial development bonds, municipal lease obligations,
certificates of participation (not to exceed 10% of assets), inverse floaters
(not to exceed 5% of assets), instruments with demand features, tender option
bonds and standby commitments.

At times, this Fund may invest more than 25% of its assets in tax-exempt
securities that are related in such a way that an economic, business, or
political development or change affecting one security could similarly affect
the other securities; for example, securities whose issuers are located in the
same state, or securities whose interest is derived from revenues of similar
type projects. The Fund may invest more than 25% of its assets in industrial
development bonds.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
11
<PAGE>

TYPES OF INVESTMENTS

Subject to the specific investment policies of each Fund discussed above, the
Fixed-Income Funds may also invest in mortgage- and asset-backed securities
(unlimited for Janus Flexible Income Fund and up to 25% of assets for the others
Funds); zero coupon bonds (up to 10% of assets for each Fund);
high-yield/high-risk securities (less than 35% of net assets for Janus
Short-Term Bond Fund and Janus Federal Tax-Exempt Fund; unlimited for Janus
Flexible Income Fund); securities purchased on a when-issued, delayed delivery
or forward commitment basis; and indexed/structured securities. In addition,
each Fund may use futures, options and other derivatives for hedging purposes or
for other purposes, such as enhancing return. See "Additional Risk Factors" on
pages 14-15. When its portfolio manager is unable to locate investment
opportunities with favorable risk/reward characteristics, the cash position of
any Fund may increase and the Fund may have substantial holdings of cash or cash
equivalent short-term obligations. See "General Portfolio Policies" on page 13.

THE FOLLOWING QUESTIONS ARE DESIGNED TO HELP YOU BETTER UNDERSTAND AN INVESTMENT
IN THE JANUS FIXED-INCOME FUNDS.

HOW DO INTEREST RATES AFFECT THE VALUE OF MY INVESTMENT?

A fundamental risk associated with any fund that invests in fixed-income
securities (e.g, a bond fund) is the risk that the value of the securities it
holds will rise or fall as interest rates change. Generally, a fixed-income
security will increase in value when interest rates fall and decrease in value
when interest rates rise. Longer-term securities are generally more sensitive to
interest rate changes than shorter-term securities, but they generally offer
higher yields to compensate investors for the associated risks. A bond fund's
average-weighted maturity and its duration are measures of how the fund may
react to interest rate changes.

WHAT IS MEANT BY A FUND'S "AVERAGE-WEIGHTED MATURITY"?

The stated maturity of a bond is the date when the issuer must repay the bond's
entire principal value to an investor, such as a Fund. A bond's term to maturity
is the number of years remaining to maturity. A bond fund does not have a stated
maturity, but it does have an average-weighted maturity. This number is
calculated by averaging the terms to maturity of bonds held by a Fund with each
maturity "weighted" according to the percentage of net assets that it
represents.

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WHAT IS MEANT BY A FUND'S "DURATION"?

A bond's duration indicates the time it will take an investor to recoup his or
her investment. Unlike average maturity, duration reflects both principal and
interest payments. Generally, the higher the coupon rate on a bond, the lower
its duration will be. The duration of a bond fund is calculated by averaging the
duration of bonds held by a fund with each duration "weighted" according to the
percentage of net assets that it represents. Because duration accounts for
interest payments, a Fund's duration is usually shorter than its average
maturity.

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HOW DO THE FIXED-INCOME FUNDS MANAGE INTEREST RATE RISK?

Each Fixed-Income Fund may vary the average-weighted maturity of its portfolio
to reflect its portfolio manager's analysis of interest rate trends and other
factors. A Fund's average-weighted maturity will tend to be shorter when its
portfolio manager expects interest rates to rise and longer when its portfolio
manager expects interest rates to fall. The Funds may also use futures, options
and other derivatives to manage interest rate risk. See "Additional Risk
Factors" on pages 14-15.

WHAT IS MEANT BY "CREDIT QUALITY"?

Credit quality measures the likelihood that the issuer will meet its obligations
on a bond. One of the fundamental risks associated with all fixed-income funds
is credit risk, which is the risk that an issuer will be unable to make
principal and interest payments when due. U.S. government securities are
generally considered to be the safest type of investment in terms of credit
risk. Municipal obligations generally rank between U.S. government securities
and corporate debt securities in terms of credit safety. Corporate debt
securities, particularly those rated below investment grade, present the highest
credit risk.

- --------------------------------------------------------------------------------

HOW IS CREDIT QUALITY MEASURED?

Ratings published by nationally recognized statistical rating agencies such as
Standard & Poor's Ratings Services ("Standard & Poor's") and Moody's Investors
Service, Inc. ("Moody's") are widely accepted measures of credit risk. The lower
a bond issue is rated by an agency, the more credit risk it is considered to
represent. Lower rated bonds generally pay higher yields to compensate investors
for the associated risk. Please refer to Appendix B for a description of rating
categories.

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WHAT ARE THE TAX ADVANTAGES OF INVESTING IN JANUS FEDERAL TAX-EXEMPT FUND?

Most regular income dividends you receive from Janus Federal Tax-Exempt Fund
generally will not be subject to federal income tax. Additionally, your state
may not tax the portion of this Fund's income derived from obligations issued by
your state (if any). Capital gains distributed by this Fund are taxable to you.
See "Distributions" and "Taxes" on pages 24-25. The higher your income tax level
is, the more you will benefit from tax exempt investing.

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HOW DO THE FIXED-INCOME FUNDS DIFFER FROM EACH OTHER?

The chart on page 13 shows that the Fixed-Income Funds differ substantially in
terms of the type, credit quality and average maturity of the securities in
which they invest.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
12
<PAGE>

GENERAL PORTFOLIO POLICIES

Unless otherwise stated, each of the following policies applies to all of the
Funds. The percentage limitations included in these policies and elsewhere in
this Prospectus apply at the time of purchase of the security. For example, if a
Fund exceeds a limit as a result of market fluctuations or the sale of other
securities, it will not be required to dispose of any securities.

CASH POSITION

When a Fund's portfolio manager believes that market conditions are not
favorable for profitable investing or when the portfolio manager is otherwise
unable to locate favorable investment opportunities, a Fund's investments may be
hedged to a greater degree and/or its cash or similar investments may increase.
In other words, the Funds do not always stay fully invested in stocks and bonds.
Cash or similar investments are a residual - they represent the assets that
remain after a portfolio manager has committed available assets to desirable
investment opportunities. Partly because the portfolio managers act
independently of each other, the cash positions of the Funds may vary
significantly. Larger hedged positions and/or larger cash positions may serve as
a means of preserving capital in unfavorable market conditions.

Securities that the Funds may invest in as means of receiving a return on idle
cash include high-grade commercial paper, certificates of deposit, repurchase
agreements or other short-term debt obligations. The Funds may also invest in
money market funds (including funds managed by Janus Capital). Janus Federal
Tax-Exempt Fund may invest in such securities even though they may be federally
taxable. When a Fund's investments in cash or similar investments increase, a
Fund may not participate in stock or bond market advances or declines to the
same extent that it would if the Fund remained more fully invested in stocks or
bonds.

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Primary Interest Rate
Investment Type Credit Risk Risk
- --------------------------------------------------------------------------------
Janus Flexible Income Fund Corporate Bonds High High

Janus Intermediate U.S. Government
Gov't Securities Fund Securities Low Moderate

Janus Short-Term
Bond Fund Corporate Bonds Moderate Low

Janus Federal Municipal
Tax-Exempt Fund Securities Moderate High
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DIVERSIFICATION

The Investment Company Act of 1940 (the "1940 Act") classifies investment
companies as either diversified or nondiversified. All of the Funds (except
Janus Twenty Fund, Janus Enterprise Fund and Janus Mercury Fund) qualify as
diversified funds under the 1940 Act. The Funds are subject to the following
diversification requirements:

o As a fundamental policy, no Fund may own more than 10% of the outstanding
voting shares of any issuer.

o As a fundamental policy, with respect to 50% of the total assets of Janus
Twenty Fund, Janus Enterprise Fund and Janus Mercury Fund and 75% of the
total assets of the other Funds, no Fund will purchase a security of any
issuer (other than cash items and U.S. government securities, as defined in
the 1940 Act) if such purchase would cause a Fund's holdings of that issuer
to amount to more than 5% of that Fund's total assets.

o No Fund will invest more than 25% of its assets in a single issuer.

INDUSTRY CONCENTRATION

As a fundamental policy, no Fund will invest more than 25% of its total assets
in any particular industry. This policy does not apply to U.S. government
securities and municipal obligations issued by governments or their subdivisions
because the issuers of those securities are not considered a part of any
industry.

PORTFOLIO TURNOVER

Each Fund generally intends to purchase securities for long-term investment
rather than short-term gains. However, short-term transactions may result from
liquidity needs, securities having reached a price or yield objective, changes
in interest rates or the credit standing of an issuer, or by reason of economic
or other developments not foreseen at the time of the initial investment
decision. Changes are made in a Fund's portfolio whenever its portfolio manager
believes such changes are desirable. Portfolio turnover rates are generally not
a factor in making buy and sell decisions.

To a limited extent, a Fund may purchase securities in anticipation of
relatively short-term price gains. A Fund may also sell one security and
simultaneously purchase the same or comparable security to take advantage of
short-term differentials in bond yields or securities prices. Increased
portfolio turnover may result in higher costs for brokerage commissions, dealer
mark-ups and other transaction costs and may also result in taxable capital
gains. Certain tax rules may restrict the Funds' ability to engage in short-term
trading if a security has been held for less than three months.

ILLIQUID INVESTMENTS

Each Fund may invest up to 15% of its net assets in illiquid investments,
including restricted securities or private placements that are not deemed to be
liquid by Janus

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
13
<PAGE>

Capital. An illiquid investment is a security or other position that cannot be
disposed of quickly in the normal course of business. Some securities cannot be
sold to the U.S. public because of their terms or because of SEC regulations.
Janus Capital may determine that securities that cannot be sold to the U.S.
public but that can be sold to institutional investors (for example, Rule 144A
securities) are liquid. Janus Capital will follow guidelines established by the
Trustees of the Trust ("Trustees") in making liquidity determinations for Rule
144A securities and certain other securities, including privately placed
commercial paper and municipal lease obligations.

BORROWING AND LENDING

Each Fund may borrow money and lend securities or other assets, as follows:

o Each Fund may borrow money for temporary or emergency purposes in amounts
up to 25% of its total assets.

o Each Fund may mortgage or pledge securities as security for borrowings in
amounts up to 15% of its net assets.

o As a fundamental policy, each Fund may lend securities or other assets if,
as a result, no more than 25% of its total assets would be lent to other
parties.

Each Fund intends to seek permission from the SEC to borrow money from or lend
money to each other and other funds that permit such transactions and for which
Janus Capital serves as investment adviser. All such borrowing and lending will
be subject to the above percentage limits. There is no assurance that such
permission will be granted.

ADDITIONAL RISK FACTORS

FOREIGN SECURITIES

INVESTMENTS IN FOREIGN SECURITIES, INCLUDING THOSE OF FOREIGN GOVERNMENTS,
INVOLVE GREATER RISKS THAN INVESTING IN COMPARABLE DOMESTIC SECURITIES.

Securities of some foreign companies and governments may be traded in the United
States, but many foreign securities are traded primarily in foreign markets. The
risks of foreign investing include:

o Currency Risk. A Fund may buy the local currency when it buys a foreign
currency denominated security and sell the local currency when it sells the
security. As long as a Fund holds a foreign security, its value will be
affected by the value of the local currency relative to the U.S. dollar.
When a Fund sells a foreign security, its value may be worth less in U.S.
dollars even though the security increases in value in its home country.
U.S. dollar denominated securities of foreign issuers may also be affected
by currency risk.

o Political and Economic Risk. Foreign investments may be subject to
heightened political and economic risks, particularly in underdeveloped or
developing countries which may have relatively unstable governments and
economies based on only a few industries. In some countries, there is the
risk that the government may take over the assets or operations of a
company or that the government may impose taxes or limits on the removal of
a Fund's assets from that country.

o Regulatory Risk. There may be less government supervision of foreign
markets. Foreign issuers may not be subject to the uniform accounting,
auditing and financial reporting standards and practices applicable to
domestic issuers. There may be less publicly available information about
foreign issuers than domestic issuers.

o Market Risk. Foreign securities markets, particularly those of
underdeveloped or developing countries, may be less liquid and more
volatile than domestic markets. Certain markets may require payment for
securities before delivery and delays may be encountered in settling
securities transactions. In some foreign markets, there may not be
protection against failure by other parties to complete transactions. There
may be limited legal recourse against an issuer in the event of a default
on a debt instrument.

o Transaction Costs. Transaction costs of buying and selling foreign
securities, including brokerage, tax and custody costs, are generally
higher than those involved in domestic transactions.

INVESTMENTS IN SMALLER COMPANIES

SMALLER OR NEWER COMPANIES MAY SUFFER MORE SIGNIFICANT LOSSES AS WELL AS REALIZE
MORE SUBSTANTIAL GROWTH THAN LARGER OR MORE ESTABLISHED ISSUERS.

Smaller or newer companies may lack depth of management, they may be unable to
generate funds necessary for growth or potential development, or they may be
developing or marketing new products or services for which markets are not yet
established and may never become established. In addition, such companies may be
insignificant factors in their industries and may become subject to intense
competition from larger or more established companies. Securities of smaller or
newer companies may have more limited trading markets than the markets for
securities of larger or more established issuers, and may be subject to wider
price fluctuations. Investments in such companies tend to be more volatile and
somewhat more speculative.

FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS

Each Fund may enter into futures contracts on securities, financial indices and
foreign currencies and options on such contracts ("futures contracts") and may
invest in options on securities, financial indices and foreign currencies
("options"), forward contracts and interest rate swaps and swap-related products
(collectively "derivative instruments"). The Funds intend to use most derivative
instruments primarily to hedge the value of their portfolios against potential
adverse movements in securities prices, foreign

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
14
<PAGE>

currency markets or interest rates. To a limited extent, the Funds may also use
derivative instruments for non-hedging purposes such as seeking to increase a
Fund's income or otherwise seeking to enhance return. Please refer to Appendix A
to this Prospectus and the SAI for a more detailed discussion of these
instruments.

The use of derivative instruments exposes the Funds to additional investment
risks and transaction costs. Risks inherent in the use of derivative instruments
include:

o the risk that interest rates, securities prices and currency markets will
not move in the direction that a portfolio manager anticipates;

o imperfect correlation between the price of derivative instruments and
movements in the prices of the securities, interest rates or currencies
being hedged;

o the fact that skills needed to use these strategies are different from
those needed to select portfolio securities;

o inability to close out certain hedged positions to avoid adverse tax
consequences;

o the possible absence of a liquid secondary market for any particular
instrument and possible exchange-imposed price fluctuation limits, either
of which may make it difficult or impossible to close out a position when
desired;

o leverage risk, that is, the risk that adverse price movements in an
instrument can result in a loss substantially greater than a Fund's initial
investment in that instrument (in some cases, the potential loss is
unlimited); and

o particularly in the case of privately-negotiated instruments, the risk that
the counterparty will fail to perform its obligations, which could leave a
Fund worse off than if it had not entered into the position.

Although the Funds believe the use of derivative instruments will benefit the
Funds, a Fund's performance could be worse than if the Fund had not used such
instruments if a portfolio manager's judgement proves incorrect.

When a Fund invests in a derivative instrument, it may be required to segregate
cash and other high-grade liquid assets or certain portfolio securities with its
custodian to "cover" the Fund's position. Assets segregated or set aside
generally may not be disposed of so long as the Fund maintains the positions
requiring segregation or cover. Segregating assets could diminish the Fund's
return due to the opportunity losses of foregoing other potential investments
with the segregated assets.

HIGH-YIELD/HIGH-RISK SECURITIES

High-yield/high-risk securities (or "junk" bonds) are debt securities rated
below investment grade by the primary rating agencies (Standard & Poor's and
Moody's). Please refer to Appendix B for a description of bond rating
categories. The Funds expect that holdings of lower quality securities, if any,
will consist primarily of bonds rated in the highest two tiers of non-investment
grade securities.

The value of lower quality securities generally is more dependent on the ability
of the issuer to meet interest and principal payments (i.e., credit risk) than
is the case for higher quality securities. Conversely, the value of higher
quality securities may be more sensitive to interest rate movements than lower
quality securities. Issuers of high-yield securities may not be as strong
financially as those issuing bonds with higher credit ratings. Investments in
such companies are considered to be more speculative than higher quality
investments.

Issuers of high-yield securities are more vulnerable to real or perceived
economic changes (for instance, an economic downturn or prolonged period of
rising interest rates), political changes or adverse developments specific to
the issuer. Adverse economic, political or other developments may impair the
issuer's ability to service principal and interest obligations, to meet
projected business goals and to obtain additional financing, particularly if the
issuer is highly leveraged. In the event of a default, a Fund would experience a
reduction of its income and could expect a decline in the market value of the
defaulted securities.

The market for lower quality securities is generally less liquid than the market
for higher quality bonds. Adverse publicity and investor perceptions as well as
new or proposed laws may also have a greater negative impact on the market for
lower quality securities. Unrated debt, while not necessarily of lower quality
than rated securities, may not have as broad a market as rated securities.

The market prices of high-yield securities structured as zero coupon or
pay-in-kind securities are generally affected to a greater extent by interest
rate changes and tend to be more volatile than securities which pay interest
periodically. In addition, zero coupon, pay-in-kind and delayed interest bonds
often do not pay interest until maturity. However, the Funds must recognize a
computed amount of interest income and pay dividends to shareholders even though
it has received no cash. In some instances, the Funds may have to sell
securities to have sufficient cash to pay the dividends.

SPECIAL SITUATIONS

Each Fund (except Janus Intermediate Government Securities Fund) may invest in
"special situations" from time to time. A special situation arises when, in the
opinion of a Fund's portfolio manager, the securities of a particular issuer
will be recognized and appreciate in value due to a specific development with
respect to that issuer. Developments creating a special situation might include,
among others, a new product or process, a technological breakthrough, a
management change or other extraordinary corporate event, or differences in
market supply of and demand for the security. Investment in special situations
may carry an additional risk of loss in the event that the anticipated
development does not occur or does not attract the expected attention.

See Appendix A for risks associated with certain other investments.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
15
<PAGE>

SHAREHOLDER'S MANUAL

This section will help you become familiar with the different types of accounts
you can establish with Janus. This section also explains in detail the wide
array of services and features you can establish on your account. These services
may be modified or discontinued without shareholder approval.

HOW TO GET IN TOUCH WITH JANUS

If you have any questions while reading our Prospectus, please call one of our
Investor Service Representatives at 1-800-525-3713 Monday-Friday: 8:00
a.m.-10:00 p.m., and Saturday: 10:00 a.m.-7:00 p.m., New York time.

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MINIMUM INVESTMENTS*
To open a new account .............................................. $2,500
To open a new retirement or UGMA/UTMA account ...................... $ 500
To open a new account with an Automatic Investment Program.......... $ 500**
To add to any type of an account ................................... $ 100

*The Fund reserves the right to change the amount of these minimums from time to
time or to waive them in whole or in part for certain types of accounts.
**There is a $100 minimum subsequent investment.
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TYPES OF ACCOUNT OWNERSHIP

If you are investing in the Funds for the first time, you will need to establish
an account. You can establish the following types of accounts by completing the
New Account Application included with this Prospectus:

o Individual or Joint Ownership. Individual accounts are owned by one person.
Joint accounts have two or more owners.

o A Gift or Transfer to Minor (UGMA or UTMA). An UGMA/UTMA account is a
custodial account managed for the benefit of a minor. To open an UGMA or
UTMA account, you must include the minor's Social Security number on the
application.

o Trust. An established trust can open an account. The names of each trustee,
the name of the trust and the date of the trust agreement must be included
on the application.

o Business Accounts. Corporations and partnerships may also open an account.
The application must be signed by an authorized officer of the corporation
or a general partner of the partnership.

RETIREMENT ACCOUNTS

If you are eligible, you may set up your account under a tax-sheltered
retirement plan. A retirement plan allows you to shelter your investment income
and capital gains from current income taxes. A contribution to these plans may
also be tax deductible. Distributions from a retirement plan are generally
subject to income tax and may be subject to an additional tax if withdrawn prior
to age 591/2.

Investors Fiduciary Trust Company serves as custodian for the retirement plans
offered by the Funds. There is an annual $12 fee per account to maintain your
retirement account. The maximum annual fee is $24 per taxpayer identification
number. You may pay the fee by check or have it automatically deducted from your
account (usually in December).

The following plans require a special application. For an application and more
details about our Retirement Plans, call 1-800-525-3713.

o Individual Retirement Account: An IRA allows individuals under age 701/2
with earned income to contribute up to the lesser of $2,000 or 100% of
compensation annually. Please refer to the Janus Funds IRA booklet for
complete information regarding IRAs.

o Simplified Employee Pension Plan ("SEP"): This plan allows small business
owners (including sole proprietors) to make tax-deductible contributions
for themselves and any eligible employee(s). A SEP requires an IRA (a
SEP-IRA) to be set up for each SEP participant.

o Profit Sharing or Money Purchase Pension Plan: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees
and themselves.

o Section 403(b)(7) Plan: Employees of educational organizations or other
qualifying, tax-exempt organizations may be eligible to participate in a
Section 403(b)(7) Plan.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
16
<PAGE>

HOW TO OPEN YOUR JANUS ACCOUNT

Complete and sign the appropriate application. Please be sure to provide your
Social Security or taxpayer identification number on the application. Make your
check payable to Janus Funds. Send all items to one of the following addresses:

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

INVESTOR SERVICE CENTERS

Janus Funds offers two Investor Service Centers for those individuals who would
like to conduct their investing in person. Our representatives will be happy to
assist you at either of the following locations:

100 Fillmore Street, Suite 100
Denver, CO 80206

3773 Cherry Creek North Drive, Suite 101
Denver, CO 80209

MINIMUM INVESTMENT POLICIES

ACCOUNTS ESTABLISHED AFTER FEBRUARY 18, 1996

Any account opened after February 18, 1996, must meet minimum investment
requirements described at page 16.

ACCOUNTS ESTABLISHED ON OR BEFORE FEBRUARY 18, 1996

o The minimum investment requirement remains at $1,000 ($250 for retirement
accounts and UGMA/UTMA accounts) for these accounts only.

o There is no minimum initial investment requirement for Automatic Monthly
Investment Program participants that continue to make subsequent automatic
investments of at least $50.

o Subsequent investments (other than automatic monthly investments) must meet
the $100 minimum.

ALL ACCOUNTS

Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 annual maintenance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
above or to close such accounts. This policy will apply to accounts
participating in the Automatic Monthly Investment Program only if your account
balance does not reach the required minimum initial investment or falls below
such minimum and you have discontinued monthly investments. This policy does not
apply to accounts that fall below the minimums solely as a result of market
value fluctuations. It is expected that accounts will be valued and the $10 fee
assessed on the second Friday of September of each year. You will receive notice
before we charge the $10 fee or close your account so that you may increase your
account balance to the required minimum.

HOW TO PURCHASE SHARES

PAYING FOR SHARES

When you purchase shares, your request will be processed at the next NAV
calculated after your order is received and accepted. Please note the following:

o Cash, credit cards, third party checks and credit card checks will not be
accepted.

o All purchases must be made in U.S. dollars.

o Checks must be drawn on U.S. banks and made payable to Janus Funds.

o If a check does not clear your bank, the Funds reserve the right to cancel
the purchase.

o If the Funds are unable to debit your predesignated bank account on the day
of purchase, they may make additional attempts or cancel the purchase.

o The Funds reserve the right to reject any specific purchase request.

If your purchase is cancelled, you will be responsible for any losses or fees
imposed by your bank and losses that may be incurred as a result of any decline
in the value of the cancelled purchase. The Funds (or their agents) have the
authority to redeem shares in your account(s) to cover any losses due to
fluctuations in share price. Any profit on such cancellation will accrue to the
Fund.

ONCE YOU HAVE OPENED YOUR JANUS ACCOUNT, THE MINIMUM AMOUNT FOR AN ADDITIONAL
INVESTMENT IS $100. You may add to your account at any time through any of the
following options:

BY MAIL

Complete the remittance slip attached at the bottom of your confirmation
statement. If you are making a purchase into a retirement account, please
indicate whether the purchase is a rollover or a current or prior year
contribution. Send your check and remittance slip or written instructions to one
of the addresses listed previously. You may also request a booklet of remittance
slips for non-retirement accounts.

BY TELEPHONE

This service allows you to purchase additional shares quickly and conveniently
through an electronic transfer of money. When you make an additional purchase by
telephone, Janus will automatically debit your predesignated bank account for
the desired amount. To establish the telephone purchase option on your new
account, complete the "Telephone Purchase of Shares Option" section on the
application and attach a "voided" check or deposit slip from your bank account.
If your account is already established, call 1-800-525-3713 to request the
appropriate form. This option will become effective ten business days after the
form is received.

BY WIRE

Purchases may also be made by wiring money from your bank account to your Janus
account. Call 1-800-525-3713 to receive wiring instructions.

AUTOMATIC INVESTMENT PROGRAMS

Janus offers several automatic investment plans to help you achieve your
financial goals as simply and conveniently as possible. You may open a new
account with a $500 initial purchase and $100 automatic subsequent investments.

o AUTOMATIC MONTHLY INVESTMENT PROGRAM
You select the day each month that your money ($100 minimum) will be
electronically transferred from your bank account

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
17
<PAGE>

to your Fund account. To establish this option, complete the "Automatic
Monthly Investment Program" section on the application and attach a
"voided" check or deposit slip from your bank account. If your Fund account
is already established, call 1-800-525-3713 to request the appropriate
form.

o PAYROLL DEDUCTION
If your employer can initiate an automatic payroll deduction, you may have
all or a portion of your paycheck invested directly into your Fund account.
To obtain information on establishing this option, call 1-800-525-3713.

o BY SYSTEMATIC EXCHANGE
With a Systematic Exchange you determine the amount of money ($100 minimum)
you would like automatically exchanged from one Janus account to another on
any day of the month. For more information on how to establish this option,
call 1-800-525-3713.

HOW TO EXCHANGE SHARES

On any business day, you may exchange all or a portion of your shares into any
other available Janus fund.

IN WRITING

To request an exchange in writing, please follow the instructions for written
requests on page 19.

BY TELEPHONE

All accounts are automatically eligible for the telephone exchange option. To
exchange shares by telephone, call an Investor Service Representative at
1-800-525-3713 during normal business hours or call the Janus Electronic
Telephone Service (JETS(R)) line at 1-800-525-6125.

BY SYSTEMATIC EXCHANGE

As noted above, you may establish a Systematic Exchange for as little as a $100
subsequent purchase per month on established accounts. You may establish a new
account with a $500 initial purchase and subsequent $100 systematic exchanges.

If the balance in the account you are exchanging from falls below the systematic
exchange amount, all remaining shares will be exchanged and the program will be
discontinued.

EXCHANGE POLICIES

o Except for Systematic Exchanges, new accounts established by exchange must
meet the $2,500 minimum, or be for the total account value if less than
$2,500.

o Exchanges between existing accounts must meet the $100 subsequent
investment requirement.

o You may make four exchanges out of each Fund during a calendar year
(exclusive of Systematic Exchanges) free of charge. The Funds reserve the
right to have a $5 transaction fee automatically deducted from your account
for each additional exchange.

o Exchanges between accounts will be accepted only if the registrations are
identical.

o If the shares you are exchanging are held in certificate form, you must
return the certificate to your Fund prior to making any exchanges.

o Be sure that you read the prospectus for the Fund into which you are
exchanging.

o The Funds reserve the right to reject any exchange request and to modify or
terminate the exchange privilege at any time. For example, the Funds may
reject exchanges from accounts engaged in excessive trading (including
market timing transactions) that are detrimental to the Funds.

o An exchange represents the sale of shares from one Fund and the purchase of
shares of another Fund, which may produce a taxable gain or loss in a
non-tax deferred account.

QUICK ADDRESS AND TELEPHONE REFERENCE

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

Janus Investor Services 1-800-525-3713
To speak to a service representative

JETS(R) 1-800-525-6125
For 24-hour access to account and Fund information.

TDD 1-800-525-0056
A telecommunications device for our hearing- and speech-impaired shareholders.

Janus QuotelineSM 1-800-525-0024
For automated daily quotes on Fund share prices, yields and total returns.

Janus Literature Line 1-800-525-8983
To request a prospectus, shareholder reports or marketing materials.

HOW TO REDEEM SHARES

On any business day, you may redeem all or a portion of your shares. If the
shares are held in certificate form, the certificate must be returned with or
before your redemption request. Your transaction will be processed at the next
NAV calculated after your order is received and accepted.

IN WRITING

To request a redemption in writing, please follow the instructions for written
requests on page 19.

BY TELEPHONE

Most accounts have the telephone redemption option, unless this option was
specifically declined on the application or in writing. This option enables you
to redeem up to $100,000 daily from your account by simply calling
1-800-525-3713 by 4:00 p.m. New York time.

SYSTEMATIC WITHDRAWAL PLAN ("SWP")

SWPs allow you to redeem a specific dollar amount from your account on a regular
basis. For more information on SWPs or to request the appropriate form, please
call 1-800-525-3713.

PAYMENT OF REDEMPTION PROCEEDS

o BY CHECK
Redemption proceeds will be sent to the shareholder(s) of record at the
address of record within seven days after receipt of a valid redemption
request.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
18
<PAGE>

o ELECTRONIC TRANSFER
If you have established this option, your redemption proceeds will be
electronically transferred to your predesignated bank account on the second
business day after receipt of your redemption request. To establish this
option, call 1-800-525-3713. There is no fee for this option.

o BY WIRE
If you are authorized for the wire redemption service, your redemption
proceeds will be wired directly into your designated bank account on the
next business day after receipt of your redemption request. There is no
limitation on redemptions by wire; however, there is an $8 fee for each
wire and your bank may charge an additional fee to receive the wire. If you
would like to establish this option on an existing account, please call
1-800-525-3713 to request the appropriate form. Wire redemptions are not
available for retirement accounts.

IF THE SHARES BEING REDEEMED WERE PURCHASED BY CHECK, TELEPHONE OR THROUGH THE
AUTOMATIC MONTHLY INVESTMENT PROGRAM, THE FUNDS MAY DELAY THE PAYMENT OF YOUR
REDEMPTION PROCEEDS FOR UP TO 15 DAYS FROM THE DAY OF PURCHASE TO ALLOW THE
PURCHASE TO CLEAR. Unless you provide alternate instructions, your proceeds will
be invested in Janus Money Market Fund - Investor Shares during the 15 day hold
period.

WRITTEN INSTRUCTIONS

To redeem or exchange all or part of your shares in writing, your request should
be sent to one of the addresses listed on page 17 and must include the following
information:

o the name of the Fund(s)
o the account number(s)
o the amount of money or number of shares being redeemed
o the name(s) on the account
o the signature(s) of all registered account owners
o your daytime telephone number

SIGNATURE REQUIREMENTS BASED ON ACCOUNT TYPE

o Individual, Joint Tenants, Tenants in Common: Written instructions must be
signed by each shareholder, exactly as the names appear in the account
registration.

o UGMA or UTMA: Written instructions must be signed by the custodian in
his/her capacity as it appears in the account registration.

o Sole Proprietor, General Partner: Written instructions must be signed by an
authorized individual in his/her capacity as it appears in the account
registration.

o Corporation, Association: Written instructions must be signed by the
person(s) authorized to act on the account. In addition, a certified copy
of the corporate resolution authorizing the signer to act must accompany
the request.

o Trust: Written instructions must be signed by the trustee(s). If the name
of the current trustee(s) does not appear in the account registration, a
certificate of incumbency dated within 60 days must also be submitted.

o IRA: Written instructions must be signed by the account owner. If you do
not want federal income tax withheld from your redemption, you must state
that you elect not to have such withholding apply. In addition, your
instructions must state whether the distribution is normal (after age
591/2) or premature (before age 591/2) and, if premature, whether any
exceptions such as death or disability apply with regard to the 10%
additional tax on early distributions.

PRICING OF FUND SHARES

SIGNATURE GUARANTEE

In addition to the signature requirements, A SIGNATURE GUARANTEE IS ALSO
REQUIRED if any of the following is applicable:

o The redemption exceeds $100,000.

o You would like the check made payable to anyone other than the
shareholder(s) of record.

o You would like the check mailed to an address which has been changed within
10 days of the redemption request.

o You would like the check mailed to an address other than the address of
record.

THE FUNDS RESERVE THE RIGHT TO REQUIRE A SIGNATURE GUARANTEE UNDER OTHER
CIRCUMSTANCES OR TO REJECT OR DELAY A REDEMPTION ON CERTAIN LEGAL GROUNDS. FOR
MORE INFORMATION PERTAINING TO SIGNATURE GUARANTEES, PLEASE CALL 1-800-525-3713.

HOW TO OBTAIN A SIGNATURE GUARANTEE

A signature guarantee assures that a signature is genuine. The signature
guarantee protects shareholders from unauthorized account transfers. The
following financial institutions may guarantee signatures: banks, savings and
loan associations, trust companies, credit unions, broker-dealers, and member
firms of a national securities exchange. Call your financial institution to see
if they have the ability to guarantee a signature. A SIGNATURE GUARANTEE MAY NOT
BE PROVIDED BY A NOTARY PUBLIC.

If you live outside the United States, a foreign bank properly authorized to do
business in your country of residence or a U.S. consulate may be able to
authenticate your signature.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
19
<PAGE>

SHAREHOLDER SERVICES AND ACCOUNT POLICIES

JANUS ELECTRONIC TELEPHONE SERVICE (JETS(R))

JETS, our electronic telephone service line, offers you 24-hour access by
TouchTone(TM) telephone to obtain your account balance, to confirm your last
transaction or dividend posted to your account, to order duplicate account or
tax statements, to reorder money market fund checks or to exchange your shares.
JETS can be accessed by calling 1-800-525-6125. Calls on JETS are limited to
seven minutes.

TRANSACTIONS THROUGH PROCESSING ORGANIZATIONS

You may purchase or sell Fund shares through a broker-dealer, bank or other
financial institution, or an organization that provides recordkeeping and
consulting services to 401(k) plans or other qualified plans (a "Processing
Organization"). Processing Organizations may charge you a fee for this service
and may require different minimum initial and subsequent investments than the
Funds. The Processing Organization may also impose other charges or restrictions
different from those applicable to shareholders who invest in the Funds
directly. The Processing Organization, rather than its customers, may be the
shareholder of record of your shares. The Funds are not responsible for the
failure of any Processing Organization to carry out its obligations to its
customers. Certain Processing Organizations may receive compensation from Janus
Capital or its affiliates and certain Processing Organizations may receive
compensation from the Funds for shareholder recordkeeping and similar services.

TAXPAYER IDENTIFICATION NUMBER

On the application or other appropriate form, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that you
are not subject to backup withholding for failing to report income to the IRS.
If you are subject to the 31% backup withholding or you did not certify your
taxpayer identification, the IRS requires the Funds to withhold 31% of any
dividends paid and redemption or exchange proceeds. In addition to the 31%
backup withholding, you may be subject to a $50 fee to reimburse the Funds for
any penalty that the IRS may impose.

SHARE CERTIFICATES

Most shareholders choose not to hold their shares in certificate form because
account transactions such as exchanges and redemptions cannot be completed until
the certificate has been returned to the Funds. The Funds will issue share
certificates upon written request only. Share certificates will not be issued
until the shares have been held for at least 15 days and will not be issued for
accounts that do not meet the minimum investment requirements. Share
certificates cannot be issued for retirement accounts. In addition, if the
certificate is lost, there may be a replacement charge.

INVOLUNTARY REDEMPTIONS

The Funds reserve the right to close an account if the shareholder is deemed to
engage in activities which are illegal or otherwise detrimental to the Funds.

TELEPHONE TRANSACTIONS

You may initiate many transactions by telephone. The Funds and their agents will
not be responsible for any losses resulting from unauthorized transactions when
procedures designed to verify the identity of the caller are followed.

It may be difficult to reach the Funds by telephone during periods of unusual
market activity. If you are unable to reach a representative by telephone,
please consider sending written instructions, stopping by a Service Center or,
in the case of exchanges, calling the JETS line.

TEMPORARY SUSPENSION OF SERVICES

The Funds or their agents may, in case of emergency, temporarily suspend
telephone transactions and other shareholder services.

ADDRESS CHANGES

To change the address on your account, call 1-800-525-3713 or send a written
request signed by all account owners. Include the name of your Fund(s), the
account number(s), the name(s) on the account and both the old and new
addresses. Certain options may be suspended for 10 days following an address
change unless a signature guarantee is provided.

REGISTRATION CHANGES

To change the name on an account, the shares are generally transferred to a new
account. In some cases, legal documentation may be required. For more
information, call 1-800-525-3713.

STATEMENTS AND REPORTS

The Funds will send you a confirmation statement after every transaction that
affects your account balance or your account registration. If you are enrolled
in our Automatic Monthly Investment Program and invest on a monthly basis, you
will receive quarterly confirmation statements unless monthly statements are
requested. Fixed-Income Fund Investors will receive quarterly confirmations of
dividends. Information regarding the tax status of income dividends and capital
gains distributions will be mailed to shareholders on or before January 31st of
each year. Account tax information will also be sent to the IRS.

Financial reports for the Funds, which include a list of the Funds' portfolio
holdings, will be mailed semiannually to all shareholders. To reduce expenses,
only one copy of most financial reports will be mailed to accounts with the same
record address. Upon request, such reports will be mailed to all accounts in the
same household. Please call 1-800-525-3713 if you would like to receive
additional reports.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
20
<PAGE>

MANAGEMENT OF THE FUNDS

TRUSTEES

The Trustees oversee the business affairs of the Trust and are responsible for
major decisions relating to each Fund's investment objective and policies. The
Trustees delegate the day-to-day management of the Funds to the officers of the
Trust and meet at least quarterly to review the Funds' investment policies,
performance, expenses and other business affairs.

INVESTMENT ADVISER

Janus Capital, 100 Fillmore Street, Denver, Colorado 80206-4923, is the
investment adviser to each of the Funds and is responsible for the day-to-day
management of the investment portfolios and other business affairs of the Funds.

Janus Capital began serving as investment adviser to Janus Fund at its inception
in 1970 and currently serves as investment adviser to all of the Janus funds, as
well as adviser or subadviser to other mutual funds and individual, corporate,
charitable and retirement accounts.

Kansas City Southern Industries, Inc. ("KCSI") owns approximately 83% of the
outstanding voting stock of Janus Capital, most of which it acquired in 1984.
KCSI is a publicly traded holding company whose primary subsidiaries are engaged
in transportation, information processing and financial services. Thomas H.
Bailey, President and Chairman of the Board of Janus Capital, owns approximately
12% of its voting stock and, by agreement with KCSI, selects a majority of Janus
Capital's Board.

Janus Capital furnishes continuous advice and recommendations concerning each
Fund's investments. Janus Capital also furnishes certain administrative,
compliance and accounting services for the Funds, and may be reimbursed by the
Funds for its costs in providing those services. In addition, Janus Capital
employees serve as officers of the Trust and Janus Capital provides office space
for the Funds and pays the salaries, fees and expenses of all Fund officers and
those Trustees who are affiliated with Janus Capital.

INVESTMENT PERSONNEL

James P. Craig, III is Chief Investment Officer of Janus Capital. He is also
Executive Vice President and portfolio manager of Janus Fund, which he has
managed since 1986. Mr. Craig previously managed Janus Venture Fund from its
inception to December 1993 and Janus Balanced Fund from December 1993 through
December 1995. He holds a Bachelor of Arts in Business from the University of
Alabama and a Master of Arts in Finance from the Wharton School of the
University of Pennsylvania.

- --------------------------------------------------------------------------------

James P. Goff is Executive Vice President and portfolio manager of Janus
Enterprise Fund. Mr. Goff joined Janus Capital in 1988 and has managed this Fund
since its inception and has co-managed Janus Venture Fund since December 1993.
He holds a Bachelor of Arts in Economics from Yale University and is a Chartered
Financial Analyst.

- --------------------------------------------------------------------------------

Helen Young Hayes is Executive Vice President and portfolio manager of Janus
Worldwide Fund and Janus Overseas Fund. Ms. Hayes joined Janus Capital in 1987
and has managed or co-managed Janus Worldwide Fund and Janus Overseas Fund since
their inceptions. She holds a Bachelor of Arts in Economics from Yale University
and is a Chartered Financial Analyst.

- --------------------------------------------------------------------------------

Warren B. Lammert is Executive Vice President and portfolio manager of Janus
Mercury Fund. Mr. Lammert joined Janus Capital in 1987 and has managed Janus
Mercury Fund since its inception and Janus Balanced Fund from its inception to
December 1993. He has also co-managed Janus Venture Fund since December 1993. He
holds a Bachelor of Arts in Economics from Yale University and a Master of
Science in Economic History from the London School of Economics and is a
Chartered Financial Analyst.

- --------------------------------------------------------------------------------

Thomas F. Marsico is Executive Vice President and portfolio manager of Janus
Growth and Income Fund and Janus Twenty Fund. Mr. Marsico has managed Janus
Growth and Income Fund since its inception and Janus Twenty Fund since March
1988. He holds a Bachelor of Arts in Biology from the University of Colorado and
Master of Business Administration in Finance from the University of Denver.

- --------------------------------------------------------------------------------

Blaine P. Rollins is Executive Vice President and portfolio manager of Janus
Balanced Fund, which he has managed since January 1996. Mr. Rollins joined Janus
Capital in 1990 and has gained experience as a fixed income trader and equity
research analyst prior to assuming management responsibility for Janus Balanced
Fund. He holds a Bachelor of Science in Finance from the University of Colorado
and is a Chartered Financial Analyst.

- --------------------------------------------------------------------------------

Sandy R. Rufenacht is Executive Vice President and portfolio manager of Janus
Intermediate Government Securities Fund and Janus Short-Term Bond Fund. Mr.
Rufenacht joined Janus Capital in 1990 and gained experience as a trader and
research analyst before assuming management of these funds in January 1996. He
holds a Bachelor of Arts in Business from the University of Northern Colorado.

- --------------------------------------------------------------------------------

Scott W. Schoelzel is Executive Vice President and portfolio manager of Janus
Olympus Fund.+ Mr. Schoelzel joined Janus Capital in January 1994. From 1991 to
1993, Mr. Schoelzel was a portfolio manager with Founders Asset Management,
Denver, Colorado. Prior to 1991, he was a general partner of Ivy Lane
Investments, Denver, Colorado (a real estate investment partnership). He holds a
Bachelor of Arts in Business from Colorado College.

- --------------------------------------------------------------------------------

Ronald V. Speaker is Executive Vice President and portfolio manager of Janus
Flexible Income Fund, which he has managed since December 1991. Mr. Speaker
joined Janus Capital in 1986 and also manages Janus High-Yield Fund.+ He
previously managed Janus Intermediate Government Securities Fund, Janus
Short-Term Bond Fund and Janus Federal Tax-Exempt Fund from their inceptions
through December 1995. He holds a Bachelor of Arts in Finance from the
University of Colorado and is a Chartered Financial Analyst.

- --------------------------------------------------------------------------------

Darrell W. Watters is Executive Vice President and portfolio manager of Janus
Federal Tax-Exempt Fund, which he has managed since January 1996. Mr. Watters
joined Janus Capital in 1993 as a municipal bond trader. He holds a Bachelor of
Arts in Economics from Colorado State University.

- --------------------------------------------------------------------------------
+Janus Olympus Fund and Janus High-Yield Fund commenced operations on December
29, 1995, and are offered by separate prospectuses.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
21
<PAGE>

BREAKDOWN OF MANAGEMENT EXPENSES AND EXPENSE LIMITS

Each Fund pays Janus Capital a management fee which is accrued daily and paid
monthly. The advisory agreement with each Fund spells out the management fee and
other expenses that the Funds must pay. Each of the Funds is subject to the
following management fee schedule (expressed as an annual rate):

<TABLE>
<CAPTION>
Average Daily Net Annual Rate Expense Limit
Fee Schedule Assets of Fund Percentage (%) Percentage (%)
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Growth Funds and Combination Funds First $ 30 Million 1.00 None+
Next $270 Million .75
Next $200 Million .70
Over $500 Million .65

Janus Flexible Income Fund First $300 Million .65 1.00*
Over $300 Million .55

Janus Short-Term Bond Fund First $300 Million .65 .65*
Over $300 Million .55

Janus Intermediate Government Securities Fund First $300 Million .50 .65*
Over $300 Million .40

Janus Federal Tax-Exempt Fund First $300 Million .60 .65*
Over $300 Million .55
- ------------------------------------------------------------------------------------------------------------------
</TABLE>

*Janus Capital will waive certain fees and expenses to the extent that total
expenses exceed the stated limits. Janus Capital may modify or terminate the
waiver at any time upon 90 days' notice to the Trustees. You will be notified of
any changes in these limits.

+Janus Capital will waive certain fees and expenses to the extent that total
expenses exceed regulatory limits imposed by state securities regulators.

Differences in the actual management fees incurred by the Funds are due
primarily to variances in the asset size of the Funds. As asset size increases,
the annual rate of the management fee rate declines in accordance with the above
schedules. In addition, each Fund incurs expenses not assumed by Janus Capital,
including transfer agent and custodian fees and expenses, legal and auditing
fees, printing and mailing costs of sending reports and other information to
existing shareholders, and independent Trustees' fees and expenses. The Annual
Fund Operating Expenses table on page 3 lists the management fees and total
operating expenses of each Fund for the most recent fiscal year.

PERSONAL INVESTING

Janus Capital permits investment and other personnel to purchase and sell
securities for their own accounts, subject to Janus Capital's policy governing
personal investing. Janus Capital's policy requires investment and other
personnel to conduct their personal investment activities in a manner that Janus
Capital believes is not detrimental to the Funds or Janus Capital's other
advisory clients. See the SAI for more detailed information.

PORTFOLIO TRANSACTIONS

Purchases and sales of securities on behalf of each Fund are executed by
broker-dealers selected by Janus Capital. Broker-dealers are selected on the
basis of their ability to obtain best price and execution for a Fund's
transactions and recognizing brokerage, research and other services provided to
the Fund and to Janus Capital. Janus Capital may also consider payments made by
brokers effecting transactions for a Fund i) to the Fund or ii) to other persons
on behalf of the Fund for services provided to the Fund for which it would be
obligated to pay. Janus Capital may also consider sales of shares of a Fund as a
factor in the selection of broker-dealers. The Funds' Trustees have authorized
Janus Capital to place portfolio transactions on an agency basis with a
broker-dealer affiliated with Janus Capital. When transactions for a Fund are
effected with that broker-dealer, the commissions payable by the Fund are
credited against certain Fund operating expenses. The SAI further explains the
selection of broker-dealers.

OTHER SERVICE PROVIDERS

The following parties provide the Funds with administrative and other services.

Domestic Custodian
Investors Fiduciary Trust Company
127 W. 10th Street
Kansas City, Missouri 64105

Foreign Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, Massachusetts 02101

Transfer Agent
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217

Distributor
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital. Investors Fiduciary Trust Company is a
wholly-owned subsidiary of State Street Bank and Trust Company.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
22
<PAGE>

OTHER INFORMATION

ORGANIZATION

The Trust is a "mutual fund" that was organized as a Massachusetts business
trust on February 11, 1986. A mutual fund is an investment vehicle that pools
money from numerous investors and invests the money to achieve a specified
objective.

As of the date of this Prospectus, the Trust offers 18 separate series, three of
which currently offer two classes of shares. Janus Fund became a series of the
Trust on June 16, 1986. Janus Twenty Fund, Janus Flexible Income Fund and Janus
Intermediate Government Securities Fund became series of the Trust on August 7,
1992. All other Funds have been series of the Trust since their inceptions. This
Prospectus describes twelve series of the Trust; the other series are offered by
separate prospectuses.

SHAREHOLDER MEETINGS

The Trust does not intend to hold annual shareholder meetings. However, special
meetings may be called for a specific Fund or for the Trust as a whole for
purposes such as electing or removing Trustees, terminating or reorganizing the
Trust, changing fundamental policies, or for any other purpose requiring a
shareholder vote under the 1940 Act. Separate votes are taken by each Fund only
if a matter affects or requires the vote of only that Fund or that Fund's
interest in the matter differs from the interest of other portfolios of the
Trust. As a shareholder, you are entitled to one vote for each share that you
own.

SIZE OF FUNDS

The Funds have no present plans to limit their size. However, any Fund may
discontinue sales of its shares if management believes that continued sales may
adversely affect the Fund's ability to achieve its investment objective. If
sales of a Fund are discontinued, it is expected that existing shareholders of
that Fund would be permitted to continue to purchase shares and to reinvest any
dividends or capital gains distributions, absent highly unusual circumstances.

MASTER/FEEDER OPTION

The Trust may in the future seek to achieve any Fund's investment objective by
investing all of that Fund's assets in another investment company having the
same investment objective and substantially the same investment policies and
restrictions as those applicable to that Fund. It is expected that any such
investment company would be managed by Janus Capital in substantially the same
manner as the existing Fund. The Trust's shareholders of record on April 30,
1992, and the initial shareholder(s) of all Funds created after April 30, 1992,
have voted to vest authority to use this investment structure in the sole
discretion of the Trustees. No further approval of the shareholders of the Funds
is required. You will receive at least 30 days' prior notice of any such
investment. Such investment would be made only if the Trustees determine it to
be in the best interests of a Fund and its shareholders. In making that
determination, the Trustees will consider, among other things, the benefits to
shareholders and/or the opportunity to reduce costs and achieve operational
efficiencies. Although management of the Funds believe the Trustees will not
approve an arrangement that is likely to result in higher costs, no assurance is
given that costs will be materially reduced if this option is implemented.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
23
<PAGE>

DISTRIBUTIONS AND TAXES

- --------------------------------------------------------------------------------
DISTRIBUTIONS

THE INTERNAL REVENUE CODE REQUIRES EACH FUND TO DISTRIBUTE NET INCOME AND ANY
NET GAINS REALIZED BY ITS INVESTMENTS ANNUALLY. A FUND'S INCOME FROM DIVIDENDS
AND INTEREST AND ANY NET REALIZED SHORT-TERM CAPITAL GAINS ARE PAID TO
SHAREHOLDERS AS DIVIDENDS. NET REALIZED LONG-TERM GAINS ARE PAID TO SHAREHOLDERS
AS CAPITAL GAINS DISTRIBUTIONS.
- --------------------------------------------------------------------------------

DISTRIBUTION SCHEDULE

<TABLE>
<CAPTION>
Dividends Capital Gains
- ---------------------------------------------------------------------------------------------------
<S> <C> <C>
Growth Funds Declared and paid in December Declared and paid in December

Combination Funds Declared and paid in March, June, Declared and paid in December
September and December

Fixed-Income Funds* Declared daily and paid as of the last Declared and paid in December
business day of each month
- ---------------------------------------------------------------------------------------------------
</TABLE>

*While distributions for these Funds are paid monthly, the income dividends for
these Funds are declared daily, Saturdays, Sundays and holidays included, and
are generally paid as of the last business day of each month. If a month begins
on a Saturday, Sunday or holiday, dividends for those days are paid at the end
of the preceding month. An investor will begin accruing income dividends the day
after the purchase is effective. If shares are redeemed, the investor will
receive all dividends accrued through the day of the redemption.

HOW DISTRIBUTIONS AFFECT A FUND'S NAV

Distributions are paid to shareholders as of the record date of a distribution
of a Fund, regardless of how long the shares have been held. Dividends and
capital gains awaiting distribution are included in each Fund's daily NAV. The
share price of a Fund drops by the amount of the distribution, net of any
subsequent market fluctuations. As an example, assume that on December 31, Janus
Fund declared a dividend in the amount of $0.25 per share. If Janus Fund's share
price was $10.00 on December 30, the Fund's share price on December 31 would be
$9.75, barring market fluctuations.

"BUYING A DIVIDEND"

If you purchase shares of a Fund just before the distribution, you will pay the
full price for the shares and receive a portion of the purchase price back as a
taxable distribution. This is referred to as "buying a dividend." In the above
example, if you bought shares on December 30, you would have paid $10.00 per
share. On December 31, the Fund would pay you $0.25 per share as a dividend and
your shares would now be worth $9.75 per share. Unless your account is set up as
a tax-deferred account, dividends paid to you would be included in your gross
income for tax purposes even though you may not have participated in the
increase in NAV of the Fund, whether or not you reinvested the dividends.

DISTRIBUTION OPTIONS

When you open an account, you must specify on your application how you want to
receive your distributions. You may change your distribution option at any time
by writing or calling 1-800-525-3713. The Funds offer the following options:

1. Reinvestment Option. You may reinvest your income dividends and capital
gains distributions in additional shares. This option is assigned
automatically if no other choice is made.

2. Cash Option. You may receive your income dividends and capital gains
distributions in cash.

3. Reinvest And Cash Option. You may receive either your income dividends or
capital gains distributions in cash and reinvest the other in additional
shares.

4. Redirect Option. You may direct your dividends or capital gains to purchase
shares of another Janus fund.

The Funds reserve the right to reinvest undeliverable and uncashed dividend and
distribution checks that remain outstanding for six months in shares of the
applicable Fund at the NAV next computed after the check is cancelled.
Subsequent distributions may also be reinvested.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
24
<PAGE>

TAXES

As with any investment, you should consider the tax consequences of investing in
the Funds. The following discussion does not apply to tax-deferred retirement
accounts, nor is it a complete analysis of the federal tax implications of
investing in the Funds. You may wish to consult your own tax adviser.
Additionally, state or local taxes may apply to your investment, depending upon
the laws of your state of residence.

TAXES ON DISTRIBUTIONS

Janus Federal Tax-Exempt Fund anticipates that substantially all of its income
dividends will be exempt from federal income tax, although it may occasionally
earn income on taxable investments and dividends attributable to that income
would be taxable. In addition, interest from certain private activity bonds is a
preference item for purposes of the alternative minimum tax, and to the extent
the Fund earns such income shareholders subject to the alternative minimum tax
must include that income as a preference item. Distributions from capital gains,
if any, are subject to federal tax. The Fund will advise shareholders of the
percentage of dividends, if any, subject to any federal tax.

Dividends and distributions for all of the other Funds are subject to federal
income tax, regardless of whether the distribution is made in cash or reinvested
in additional shares of a Fund. In certain states, a portion of the dividends
and distributions (depending on the sources of a Fund's income) may be exempt
from state and local taxes. Information regarding the tax status of income
dividends and capital gains distributions will be mailed to shareholders on or
before January 31st of each year.

TAXATION OF THE FUNDS

Dividends, interest and some capital gains received by a Fund on foreign
securities may be subject to tax withholding or other foreign taxes. Any foreign
taxes paid by a Fund will be treated as an expense to the particular Fund or
passed through to shareholders as a foreign tax credit, depending on particular
facts and circumstances. Tax conventions between certain countries and the
United States may reduce or eliminate such taxes.

The Funds do not expect to pay any federal income or excise taxes because they
intend to meet certain requirements of the Internal Revenue Code. It is
important that the Funds meet these requirements so that any earnings on your
investment will not be taxed twice.

- --------------------------------------------------------------------------------

PERFORMANCE TERMS

This section will help you understand various terms that are commonly used to
describe a Fund's performance. You may see references to these terms in our
newsletters, advertisements and in media articles. Our newsletters and
advertisements may include comparisons of the Fund's performance to the
performance of other mutual funds, mutual fund averages or recognized stock
market indices. The Growth and Combination Funds generally measure performance
in terms of total return, while the Fixed-Income Funds generally use yield.

Cumulative total return represents the actual rate of return on an investment
for a specified period. The Financial Highlights tables beginning on page 4 show
total return for a single fiscal period. Cumulative total return is generally
quoted for more than one year (e.g., the life of the Fund). A cumulative total
return does not show interim fluctuations in the value of an investment.

Average annual total return represents the average annual percentage change of
an investment over a specified period. It is calculated by taking the cumulative
total return for the stated period and determining what constant annual return
would have produced the same cumulative return. Average annual returns for more
than one year tend to smooth out variations in a Fund's return and are not the
same as actual annual results.

Yield shows the rate of income a Fund earns on its investments as a percentage
of the Fund's share price. It is calculated by dividing a Fund's net investment
income for a 30-day period by the average number of shares entitled to receive
dividends and dividing the result by the Fund's NAV per share at the end of the
30-day period. Yield does not include changes in NAV.

Yields are calculated according to standardized SEC formulas and may not equal
the income on an investor's account. Yield is usually quoted on an annualized
basis. An annualized yield represents the amount you would earn if you remained
in a Fund for a year and that Fund continued to have the same yield for the
entire year.

Tax-equivalent yield or total return (for Janus Federal Tax-Exempt Fund) shows
the before-tax yield or total return that an investor would have to earn to
equal the Fund's tax-free yield or total return. It is calculated by dividing a
Fund's tax-free yield by the result of one minus a stated federal tax rate.

THE FUNDS IMPOSE NO SALES OR OTHER CHARGES THAT WOULD AFFECT TOTAL RETURN OR
YIELD COMPUTATIONS. FUND PERFORMANCE FIGURES ARE BASED UPON HISTORICAL RESULTS
AND ARE NOT INTENDED TO INDICATE FUTURE PERFORMANCE. INVESTMENT RETURNS AND NET
ASSET VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THEIR ORIGINAL COST.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
25
<PAGE>

APPENDIX A

GLOSSARY OF INVESTMENT TERMS

This glossary provides a more detailed description of some of the types of
securities and other instruments in which the Funds may invest. The Funds may
invest in these instruments to the extent permitted by their investment
objectives and policies. The Funds are not limited by this discussion and may
invest in any other types of instruments not precluded by the policies discussed
elsewhere in this Prospectus. Please refer to the SAI for a more detailed
discussion of certain instruments.

I. EQUITY AND DEBT SECURITIES

Bonds are debt securities issued by a company, municipality, government or
government agency. The issuer of a bond is required to pay the holder the amount
of the loan (or par value) at a specified maturity and to make scheduled
interest payments.

Certificates of Participation ("COPs") are certificates representing an interest
in a pool of securities. Holders are entitled to a proportionate interest in the
underlying securities. Municipal lease obligations are often sold in the form of
COPs. See "Municipal lease obligations" below.

Commercial paper is a short-term debt obligation with a maturity ranging from 1
to 270 days issued by banks, corporations and other borrowers to investors
seeking to invest idle cash. The Funds may purchase commercial paper issued
under Section 4(2) of the Securities Act of 1933.

Common stock represents a share of ownership in a company and usually carries
voting rights and earns dividends. Unlike preferred stock, dividends on common
stock are not fixed but are declared at the discretion of the issuer's board of
directors.

Convertible securities are preferred stocks or bonds that pay a fixed dividend
or interest payment and are convertible into common stock at a specified price
or conversion ratio.

Depositary receipts are receipts for shares of a foreign-based corporation that
entitle the holder to dividends and capital gains on the underlying security.
Receipts include those issued by domestic banks (American Depositary Receipts),
foreign banks (Global or European Depositary Receipts) and broker-dealers
(depositary shares).

Fixed-income securities are securities that pay a specified rate of return. The
term generally includes short- and long-term government, corporate and municipal
obligations that pay a specified rate of interest or coupons for a specified
period of time and preferred stock, which pays fixed dividends. Coupon and
dividend rates may be fixed for the life of the issue or, in the case of
adjustable and floating rate securities, for a shorter period.

High-yield/High-risk securities are securities that are rated below investment
grade by the primary rating agencies (BB or lower by Standard &Poor's and Ba or
lower by Moody's). Other terms commonly used to describe such securities include
"lower rated bonds," "noninvestment grade bonds" and "junk bonds."

Industrial development bonds are revenue bonds that are issued by a public
authority but which may be backed only by the credit and security of a private
issuer and may involve greater credit risk. See "Municipal securities" below.

Mortgage- and asset-backed securities are shares in a pool of mortgages or other
debt. These securities are generally pass-through securities, which means that
principal and interest payments on the underlying securities (less servicing
fees) are passed through to shareholders on a pro rata basis. These securities
involve prepayment risk, which is the risk that the underlying mortgages or
other debt may be refinanced or paid off prior to their maturities during
periods of declining interest rates. In that case, a portfolio manager may have
to reinvest the proceeds from the securities at a lower rate. Potential market
gains on a security subject to prepayment risk may be more limited than
potential market gains on a comparable security that is not subject to
prepayment risk.

Municipal lease obligations are revenue bonds backed by leases or installment
purchase contracts for property or equipment. Lease obligations may not be
backed by the issuing municipality's credit and may involve risks not normally
associated with general obligation bonds and other revenue bonds. For example,
their interest may become taxable if the lease is assigned and the holders may
incur losses if the issuer does not appropriate funds for the lease payments on
an annual basis, which may result in termination of the lease and possible
default.

Municipal securities are bonds or notes issued by a U.S. state or political
subdivision. A municipal security may be a general obligation backed by the full
faith and credit (i.e., the borrowing and taxing power) of a municipality or a
revenue obligation paid out of the revenues of a designated project, facility or
revenue source.

Passive foreign investment companies (PFICs) are any foreign corporations which
generate certain amounts of passive income or hold certain amounts of assets for
the production of passive income. Passive income includes dividends, interest,
royalties, rents and annuities. Income tax regulations may require the Funds to
recognize income associated with a PFIC prior to the actual receipt of any such
income.

Preferred stock is a class of stock that generally pays dividends at a specified
rate and has preference over common stock in the payment of dividends and
liquidation. Preferred stock generally does not carry voting rights.

Repurchase agreements involve the purchase of a security by a Fund and a
simultaneous agreement by the seller (generally a bank or dealer) to repurchase
the security from the Fund at a specified date or upon demand. This technique
offers a method of earning income on idle cash. These securities involve the
risk that the seller will fail to repurchase the security, as agreed. In that
case, a Fund will bear the risk of market value fluctuations until the

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
26
<PAGE>

security can be sold and may encounter delays and incur costs in liquidating the
security.

Reverse repurchase agreements involve the sale of a security by a Fund to
another party (generally a bank or dealer) in return for cash and an agreement
by the Fund to buy the security back at a specified price and time. This
technique may be used to provide cash to satisfy unusually high redemption
requests or for other temporary or emergency purposes.

Rule 144A securities are securities that are not registered for sale to the
general public under the Securities Act of 1933, but that may be resold to
certain institutional investors.

Standby commitments are obligations purchased by a Fund from a dealer that give
the Fund the option to sell a security to the dealer at a specified price.

Tender option bonds are generally long-term securities that are coupled with an
option to tender the securities to a bank, broker-dealer or other financial
institution at periodic intervals and receive the face value of the bond. This
type of security is commonly used as a means of enhancing the security's
liquidity.

U.S. government securities include direct obligations of the U.S. government
that are supported by its full faith and credit. Treasury bills have initial
maturities of less than one year, Treasury notes have initial maturities of one
to ten years and Treasury bonds may be issued with any maturity but generally
have maturities of at least ten years. U.S. government securities also include
indirect obligations of the U.S. government that are issued by federal agencies
and government sponsored entities. Unlike Treasury securities, agency securities
generally are not backed by the full faith and credit of the U.S. government.
Some agency securities are supported by the right of the issuer to borrow from
the Treasury, others are supported by the discretionary authority of the U.S.
government to purchase the agency's obligations and others are supported only by
the credit of the sponsoring agency.

Variable and floating rate securities have variable or floating rates of
interest and, under certain limited circumstances, may have varying principal
amounts. These securities pay interest at rates that are adjusted periodically
according to a specified formula, usually with reference to some interest rate
index or market interest rate. The floating rate tends to decrease the
security's price sensitivity to changes in interest rates.

Warrants are securities, typically issued with preferred stock or bonds, that
give the holder the right to buy a proportionate amount of common stock at a
specified price, usually at a price that is higher than the market price at the
time of issuance of the warrant. The right may last for a period of years or
indefinitely.

When-issued, delayed delivery and forward transactions generally involve the
purchase of a security with payment and delivery at some time in the future -
i.e., beyond normal settlement. The Funds do not earn interest on such
securities until settlement and bear the risk of market value fluctuations in
between the purchase and settlement dates. New issues of stocks and bonds,
private placements and U.S. government securities may be sold in this manner.

Zero coupon bonds are debt securities that do not pay regular interest at
regular intervals, but are issued at a discount from face value. The discount
approximates the total amount of interest the security will accrue from the date
of issuance to maturity. Strips are debt securities that are stripped of their
interest (usually by a financial intermediary) after the securities are issued.
The market value of these securities generally fluctuates more in response to
changes in interest rates than interest-paying securities of comparable
maturity.

II. FUTURES, OPTIONS AND OTHER DERIVATIVES

Forward contracts are contracts to purchase or sell a specified amount of
property for an agreed upon price at a specified time. Forward contracts are not
currently exchange traded and are typically negotiated on an individual basis.
The Funds may enter into forward currency contracts to hedge against declines in
the value of non-dollar denominated securities or to reduce the impact of
currency appreciation on purchases of non-dollar denominated securities. They
may also enter into forward contracts to purchase or sell securities or other
financial indices.

Futures contracts are contracts that obligate the buyer to receive and the
seller to deliver an instrument or money at a specified price on a specified
date. The Funds may buy and sell futures contracts on foreign currencies,
securities and financial indices including interest rates or an index of U.S.
government, foreign government, equity or fixed-income securities. The Funds may
also buy options on futures contracts. An option on a futures contract gives the
buyer the right, but not the obligation, to buy or sell a futures contract at a
specified price on or before a specified date. Futures contracts and options on
futures are standardized and traded on designated exchanges.

Indexed/structured securities are typically short- to intermediate-term debt
securities whose value at maturity or interest rate is linked to currencies,
interest rates, equity securities, indices, commodity prices or other financial
indicators. Such securities may be positively or negatively indexed (i.e. their
value may increase or decrease if the reference index or instrument
appreciates). Indexed/structured securities may have return characteristics
similar to direct investments in the underlying instruments and may be more
volatile than the underlying

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
27
<PAGE>

instruments. A Fund bears the market risk of an investment in the underlying
instruments, as well as the credit risk of the issuer.

Interest rate swaps involve the exchange by two parties of their respective
commitments to pay or receive interest (e.g., an exchange of floating rate
payments for fixed rate payments).

Inverse floaters are debt instruments whose interest rate bears an inverse
relationship to the interest rate on another instrument or index. For example,
upon reset the interest rate payable on a security may go down when the
underlying index has risen. Certain inverse floaters may have an interest rate
reset mechanism that multiplies the effects of change in the underlying index.
Such mechanism may increase the volatility of the security's market value.

Options are the right, but not the obligation, to buy or sell a specified amount
of securities or other assets on or before a fixed date at a predetermined
price. The Funds may purchase and write put and call options on securities,
securities indices and foreign currencies.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
28
<PAGE>

APPENDIX B

EXPLANATION OF RATING CATEGORIES

The following is a description of credit ratings issued by two of the major
credit ratings agencies. Credit ratings evaluate only the safety of principal
and interest payments, not the market value risk of lower quality securities.
Credit rating agencies may fail to change credit ratings to reflect subsequent
events on a timely basis. Although the adviser considers security ratings when
making investment decisions, it also performs its own investment analysis and
does not rely solely on the ratings assigned by credit agencies.

STANDARD &POOR'S RATINGS SERVICES

BOND RATING EXPLANATION
- --------------------------------------------------------------------------------
Investment Grade
AAA Highest rating; extremely strong capacity to pay principal and
interest.
AA High quality; very strong capacity to pay principal and interest.
A Strong capacity to pay principal and interest; somewhat more
susceptible to the adverse effects of changing circumstances and
economic conditions.
BBB Adequate capacity to pay principal and interest; normally exhibit
adequate protection parameters, but adverse economic conditions
or changing circumstances more likely to lead to a weakened
capacity to pay principal and interest than for higher rated
bonds.
Non-Investment Grade
BB,B, Predominantly speculative with respect to the issuer's capacity
CCC,CC,C to meet required interest and principal payments. BB - lowest
degree of speculation; C - the highest degree of speculation.
Quality and protective characteristics outweighed by large
uncertainties or major risk exposure to adverse conditions.
D In default.
- --------------------------------------------------------------------------------
MOODY'S INVESTORS SERVICE, INC.

Investment Grade
Aaa Highest quality, smallest degree of investment risk.
Aa High quality; together with Aaa bonds, they compose the
high-grade bond group.
A Upper-medium grade obligations; many favorable investment
attributes.
Baa Medium-grade obligations; neither highly protected nor poorly
secured. Interest and principal appear adequate for the present
but certain protective elements may be lacking or may be
unreliable over any great length of time.
Non-Investment Grade
Ba More uncertain, with speculative elements. Protection of interest
and principal payments not well safeguarded during good and bad
times.
B Lack characteristics of desirable investment; potentially low
assurance of timely interest and principal payments or
maintenance of other contract terms over time.
Caa Poor standing, may be in default; elements of danger with respect
to principal or interest payments.
Ca Speculative in a high degree; could be in default or have other
marked shortcomings.
C Lowest-rated; extremely poor prospects of ever attaining
investment standing.
- --------------------------------------------------------------------------------

Unrated securities will be treated as noninvestment grade securities unless the
portfolio manager determines that such securities are the equivalent of
investment grade securities. Securities that have received different ratings
from more than one agency are considered investment grade if at least one agency
has rated the security investment grade.

SECURITIES HOLDINGS BY RATING CATEGORY

During the fiscal period ended October 31, 1995, the percentage of securities
holdings for Janus Flexible Income Fund by rating category based upon a weighted
monthly average was:

Bonds - S&P Rating Janus Flexible Income Fund

AAA 17%
AA 0%
A 15%
BBB 27%
BB 13%
B 23%
CCC 1%
CC 0%
C 0%
Preferred Stock 1%
Cash and Options 3%
-------------------------------------------------------
TOTAL 100%
-------------------------------------------------------

No other Fund held 5% or more of its assets in bonds rated below investment
grade for the fiscal period ended October 31, 1995.

JANUS FUNDS COMBINED PROSPECTUS FEBRUARY 18, 1996
29
<PAGE>

CONTENTS

THE FUND AT A GLANCE
Brief description of the Fund ............................................. 1
EXPENSE INFORMATION
The Fund's annual operating expenses ...................................... 1
Financial Highlights - a summary of financial data ........................ 2
THE FUND IN DETAIL
The Fund's Investment Objective ........................................... 3
Types of Investments ...................................................... 3
General Portfolio Policies ................................................ 4
Additional Risk Factors ................................................... 5
PERFORMANCE TERMS
An Explanation of Performance Terms ....................................... 6
SHAREHOLDER'S MANUAL
Types of Account Ownership ................................................ 7

How to Open Your Janus Account ............................................ 8

Minimum Investment Policies ............................................... 8
How to Purchase Shares .................................................... 8
How to Exchange Shares .................................................... 9
How to Redeem Shares ...................................................... 9
SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JETS(R) ................................................................... 11
Transactions Through Processing Organizations ............................. 11
Taxpayer Identification Number ............................................ 11
Share Certificates ........................................................ 11
Involuntary Redemption .................................................... 11
Telephone Transactions .................................................... 11
Making Changes to Your Account ............................................ 11
Statements and Reports .................................................... 11
MANAGEMENT OF THE FUND
Investment Adviser and Portfolio Managers ................................. 12
Management Expenses ....................................................... 12
Portfolio Transactions .................................................... 13
Other Service Providers ................................................... 13
Other Information ......................................................... 13
DISTRIBUTIONS AND TAXES
Distributions ............................................................. 14
Taxes ..................................................................... 14
APPENDIX A
Glossary of Investment Terms .............................................. 15

[LOGO]
JANUS VENTURE FUND

100 Fillmore Street
Denver, CO 80206-4923
1-800-525-3713

February 18, 1996

Janus Venture Fund (the "Fund") is a no-load, diversified mutual fund that seeks
capital appreciation. The Fund normally invests at least 50% of its equity
assets in securities of small-sized companies.

THE FUND HAS DISCONTINUED PUBLIC SALES OF ITS SHARES TO NEW INVESTORS, BUT
SHAREHOLDERS WHO MAINTAIN OPEN FUND ACCOUNTS ARE STILL ABLE TO MAKE INVESTMENTS
IN THE FUND AND REINVEST ANY DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS. CURRENT
SHAREHOLDERS MAY ALSO OPEN ADDITIONAL FUND ACCOUNTS UNDER CERTAIN CONDITIONS. IF
A FUND ACCOUNT IS CLOSED, HOWEVER, ADDITIONAL INVESTMENTS IN THE FUND MAY NOT BE
POSSIBLE. For complete information on how to purchase, exchange and sell shares,
please see the Shareholder's Manual beginning on page 7. The Fund may resume
sale of its shares to new investors in the future, although it has no current
intention to do so.

The Fund is a portfolio of Janus Investment Fund (the "Trust"), which is
registered with the Securities and Exchange Commission ("SEC") as an open-end
management investment company. This Prospectus contains information about the
Fund that you should consider before investing. Please read it carefully and
keep it for future reference.

Additional information about the Fund is contained in a Statement of Additional
Information ("SAI") filed with the SEC. The SAI dated February 18, 1996, is
incorporated by reference into this Prospectus. For a copy of the SAI, write or
call the Fund at the address or phone number listed above.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY STATE OR
OTHER JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN
SUCH STATE OR OTHER JURISDICTION.

<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:

The Fund seeks capital appreciation.

PRIMARY HOLDINGS:

A diversified fund that invests primarily in common stocks with an emphasis on
securities of small-sized companies.

SHAREHOLDER'S INVESTMENT HORIZON:

The Fund is designed for long-term investors who seek capital appreciation and
who can tolerate the greater risks associated with investments in foreign and
domestic common stocks. The Fund is not designed as a short-term trading vehicle
and should not be relied upon for short-term financial needs.

FUND ADVISER:

Janus Capital Corporation ("Janus Capital") serves as the Fund's investment
adviser. Janus Capital has been in the investment advisory business for over 25
years and currently manages more than $30 billion in assets.

FUND MANAGERS:

James P. Goff
Warren B. Lammert

FUND INCEPTION:

April 30, 1985

EXPENSE INFORMATION

The tables and example below are designed to assist you in understanding the
various costs and expenses that you will bear directly or indirectly as an
investor in the Fund. Shareholder Transaction Expenses are fees charged directly
to your individual account when you buy, sell or exchange shares. The table
below shows that you pay no such fees. Annual Fund Operating Expenses are paid
out of the Fund's assets and include fees for portfolio management, maintenance
of shareholder accounts, shareholder servicing, accounting and other services.

- --------------------------------------------------------------------------------

SHAREHOLDER TRANSACTION EXPENSES

Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales charges on redemptions None
Redemption fees* None
Exchange fee** None

* There is an $8 service fee for redemptions by wire.
**You may be charged a $5 transaction fee for excessive exchanges. See "How to
Exchange Shares" on page 9.

ANNUAL FUND OPERATING EXPENSES(1)
(expressed as a percentage of average net assets)

Management Fee 0.68%
Other Expenses 0.24%
Total Fund Operating Expenses 0.92%

(1) The information in the table above is based on expenses before expense
offset arrangements for the fiscal period ended October 31, 1995.

EXAMPLE

1 Year 3 Years 5 Years 10 Years
- --------------------------------------------------------------------------------
Assume you invest $1,000, the Fund
returns 5% annually and its expense
ratio remains as listed above. This example
shows the operating expenses that
you would indirectly bear as an
investor in the Fund. $9 $29 $51 $113
- --------------------------------------------------------------------------------

THE EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE RETURNS
OR EXPENSES WHICH MAY BE MORE OR LESS THAN THOSE SHOWN.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
1
<PAGE>

FINANCIAL HIGHLIGHTS

Unless otherwise noted, the information below is for fiscal periods ending on
October 31 of each year. The accounting firm of Price Waterhouse LLP has audited
the Fund's financial statements since October 1, 1990. Their report is included
in the Fund's Annual Report, which is incorporated by reference into the SAI.
The Fund's financial statements for fiscal periods prior to October 1, 1990 were
audited by other independent accountants whose reports are not included in the
Annual Report. Expense and income ratios and portfolio turnover rates have been
annualized for periods of less than one year. Total returns for periods of less
than one year are not annualized.

<TABLE>
<CAPTION>
1995 1994 1993 1992(1) 1992(2) 1991(2)
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $52.86 $53.25 $47.74 $45.96 $45.05 $37.90
Income from investment operations:
2. Net investment income 0.05 0.11 0.66 0.17 0.36 0.44
3. Net gains or (losses) on securities
(both realized and unrealized) 9.49 4.40 6.72 1.61 4.23 7.71
4. Total from investment operations 9.54 4.51 7.38 1.78 4.59 8.15
Less distributions:
5. Dividends (from net investment income) (0.03) (0.53) (1.16) -- (0.25) (0.11)
6. Distributions (from capital gains) (2.84) (4.37) (0.71) -- (3.43) (0.89)
7. Total distributions (2.87) (4.90) (1.87) -- (3.68) (1.00)
8. Net asset value, end of period $59.53 $52.86 $53.25 $47.74 $45.96 $45.05
9. Total return 19.24% 9.23% 15.76% 3.87% 9.90% 22.28%
10. Net assets, end of period (in millions) $1,753 $1,550 $1,837 $1,545 $1,510 $ 893
11. Ratio of expenses to average net assets 0.92%(3) 0.96% 0.97% 1.07% 1.00% 1.04%
12. Ratio of net investment income
to average net assets 0.29% 0.27% 1.29% 1.32% 1.20% 2.10%
13. Portfolio turnover rate 113% 114% 139% 124% 166% 167%
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
1990(2) 1989(2) 1988(2) 1987(2) 1986(2)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Net asset value, beginning of period $36.97 $28.11 $34.63 $30.78 $24.17
Income from investment operations:
2. Net investment income 0.28 0.33 1.50 0.12 0.11
3. Net gains or (losses) on securities
(both realized and unrealized) 3.44 10.05 (3.70) 6.25 7.88
4. Total from investment operations 3.72 10.38 (2.20) 6.37 7.99
Less distributions:
5. Dividends (from net investment income) (0.44) (1.52) (0.15) (0.19) (0.18)
6. Distributions (from capital gains) (2.35) -- (4.17) (2.33) (1.20)
7. Total distributions (2.79) (1.52) (4.32) (2.52) (1.38)
8. Net asset value, end of period $37.90 $36.97 $28.11 $34.63 $30.78
9. Total return 10.46% 38.73% (4.56%) 22.76% 35.26%
10. Net assets, end of period (in millions) $ 256 $ 58 $ 34 $ 46 $ 31
11. Ratio of expenses to average net assets 1.16% 1.28% 1.41% 1.44% 1.90%
12. Ratio of net investment income
to average net assets 1.24% 1.10% 5.11% 0.40% 1.47%
13. Portfolio turnover rate 184% 219% 299% 250% 248%
- ----------------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from August 1, 1992 to October 31, 1992.
(2) The Fund's prior fiscal year ended on July 31st of each year.

UNDERSTANDING THE FINANCIAL HIGHLIGHTS

This section is designed to help you better understand the information
summarized in the Financial Highlights table. The table contains important
historical operating information that may be useful in making your investment
decision or understanding how your investment has performed. The Fund's Annual
Report contains additional information about the Fund's performance, including a
comparison to an appropriate securities index. For a copy of the Annual Report,
call 1-800-525-8983.

Net asset value ("NAV") is the value of a single share of the Fund. It is
computed by adding the value of all of the Fund's investments and other assets,
subtracting any liabilities and dividing the result by the number of shares
outstanding. The difference between line 1 and line 8 in the Financial
Highlights table represents the change in value of the Fund's shares over the
fiscal period, but not its total return.

Net investment income is the per share amount of dividends and interest income
earned on securities held by the Fund, less Fund expenses. Dividends (from net
investment income) is the per share amount that the Fund paid from net
investment income.

Net gain or (loss) on securities is the per share increase or decrease in value
of the securities the Fund holds. A gain (or loss) is realized when securities
are sold. A gain (or loss) is unrealized when securities increase or decrease in
value but are not sold. Distributions (from capital gains) is the per share
amount that the Fund paid from net realized gains.

Total return is the percentage increase or decrease in the value of an
investment over a stated period of time. A total return percentage includes both
changes in NAV and income. For the purpose of calculating total return, it is
assumed that dividends and distributions are reinvested at the NAV on the day of
the distribution. THE FUND'S TOTAL RETURN CANNOT BE COMPUTED DIRECTLY FROM THE
FINANCIAL HIGHLIGHTS TABLE.

Ratio of expenses to average net assets is the total of the Fund's operating
expenses divided by its average net assets for the stated period.

Ratio of net investment income to average net assets is the Fund's net
investment income divided by its average net assets for the stated period.

Portfolio turnover rate is a measure of the amount of the Fund's buying and
selling activity. It is computed by dividing total purchases or sales, whichever
is less, by the average monthly market value of the Fund's portfolio securities.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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THE FUND IN DETAIL

This section takes a closer look at the Fund's investment objective, policies
and the securities in which it invests. Please carefully review the "Additional
Risk Factors" section of this Prospectus for a more detailed discussion of the
risks associated with certain investment techniques and refer to Appendix A for
a more detailed description of investment terms used throughout this Prospectus.
You should carefully consider your own investment goals, time horizon and risk
tolerance before investing in the Fund.

Policies that are noted as "fundamental" cannot be changed without a shareholder
vote. All other policies, including the Fund's investment objective, are not
fundamental and may be changed by the Fund's Trustees without a shareholder
vote. You will be notified of any such changes that are material. If there is a
material change in the Fund's objective or policies, you should consider whether
the Fund remains an appropriate investment for you.

INVESTMENT OBJECTIVE

The investment objective of the Fund is capital appreciation. The Fund pursues
its objective by normally investing at least 50% of its equity assets in
securities issued by small-sized companies. Small-sized companies are those who
have market capitalizations of less than $1 billion or annual gross revenues of
less than $500 million. Companies whose capitalization or revenues fall outside
these ranges after the Fund's initial purchase continue to be considered
small-sized for the purposes of this policy. Subject to the above policy, the
Fund may also invest in larger companies.

TYPES OF INVESTMENTS

The Fund invests primarily in common stocks with an emphasis on securities of
small-sized companies. The Fund may also invest in larger companies with strong
growth potential or relatively well-known and large companies with potential for
capital appreciation. The Fund may invest to a lesser degree in other types of
securities including preferred stocks, warrants, convertible securities and debt
securities. Debt securities that the Fund may purchase include corporate bonds
and debentures (less than 35% of net assets in high-yield/high-risk securities);
mortgage- and asset-backed securities (not to exceed 25% of assets); zero-coupon
bonds (not to exceed 10% of assets); indexed/structured notes; high-grade
commercial paper; certificates of deposit; and repurchase agreements. Such
securities may offer growth potential because of anticipated changes in interest
rates, credit standing, currency relationships or other factors. The Fund may
also invest in short-term debt securities, including money market funds managed
by Janus Capital, as a means of receiving a return on idle cash.

When the Fund's portfolio managers believe that market conditions are not
favorable for profitable investing or when the portfolio managers are otherwise
unable to locate favorable investment opportunities, the Fund's investments may
be hedged to a greater degree and/or its cash or similar investments may
increase. In other words, the Fund does not always stay fully invested in stocks
and bonds. Cash or similar investments are a residual - they represent the
assets that remain after the portfolio managers have committed available assets
to desirable investment opportunities. When the Fund's cash position increases,
it might not participate in stock market advances or declines to the extent that
it would if it remained more fully invested in common stocks.

The Fund may invest without limit in foreign equity and debt securities. The
Fund may use options, futures and other types of derivatives for hedging
purposes or as a means of enhancing returns. See "Additional Risk Factors" on
page 5. The Fund may purchase securities on a when-issued, delayed delivery or
forward commitment basis.

THE FOLLOWING QUESTIONS ARE DESIGNED TO HELP YOU BETTER UNDERSTAND AN INVESTMENT
IN THE FUND.

HOW ARE COMMON STOCKS SELECTED?

The Fund may invest substantially all of its assets in common stocks to the
extent its portfolio managers believe that the relevant market environment
favors profitable investing in those securities. The portfolio managers
generally take a "bottom up" approach to building the portfolio. In other words,
they seek to identify individual companies with earnings growth potential that
may not be recognized by the market at large. Although themes may emerge in the
Fund, securities are generally selected without regard to any defined industry
sector or other similarly defined selection procedure. Realization of income is
not a significant investment consideration. Any income realized on the Fund's
investments will be incidental to its objective.

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ARE THE SAME CRITERIA USED TO SELECT FOREIGN SECURITIES?

Generally, yes. The portfolio managers seek companies with earnings growth
potential, regardless of country of organization or place of principal business
activity. Foreign securities are generally selected on a stock-by-stock basis
without regard to any defined allocation among countries or geographic regions.
However, certain factors such as expected levels of inflation, government
policies influencing business conditions, the outlook for currency
relationships, and prospects for economic growth among countries, regions or
geographic areas may warrant greater consideration in selecting foreign
securities. See "Additional Risk Factors" on page 5.

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WHAT IS THE MAIN RISK OF INVESTING IN A COMMON STOCK FUND?

The fundamental risk associated with any common stock fund is the risk that the
value of the stocks it holds might decrease. Stock values may fluctuate in
response to the activities of an individual company or in response to general
market and/or economic conditions. Historically, common stocks have provided
greater long-term returns and have entailed greater short-term risks than other
investment choices. Smaller or newer issuers, such as those in which the Fund
invests, are more likely to realize more substantial growth as well as suffer
more significant losses than larger or more established issuers.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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Investments in such companies can be both more volatile and more speculative.
See "Additional Risk Factors"on page 5.

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WHAT IS MEANT BY "MARKET CAPITALIZATION"?

HOW DOES THE FUND TRY TO REDUCE RISK?

Diversification of the Fund's assets reduces the effect of any single holding on
its overall portfolio value. The Fund may also use futures, options and other
derivative instruments to protect its portfolio from movements in securities
prices and interest rates. The Fund may use a variety of currency hedging
techniques, including forward currency contracts, to manage exchange rate risk
when investing directly in foreign markets. See "Additional Risk Factors" on
page 5. To the extent that the Fund holds a larger cash position, it may not
participate in market declines to the same extent as if it had remained more
fully invested in common stocks.

GENERAL PORTFOLIO POLICIES

In investing its portfolio assets, the Fund will follow the general policies
listed below. The percentage limitations included in these policies and
elsewhere in this Prospectus apply only at the time of purchase of the security.
For example, if the Fund exceeds a limit as a result of market fluctuations or
the sale of other securities, it will not be required to dispose of any
securities.

DIVERSIFICATION

The Investment Company Act of 1940 (the "1940 Act") classifies investment
companies as either diversified or nondiversified. The Fund qualifies as a
diversified fund under the 1940 Act and is subject to the following
requirements:

o As a fundamental policy, the Fund may not own more than 10% of the
outstanding voting shares of any issuer.

o As a fundamental policy, with respect to 75% of its total assets, the Fund
will not purchase a security of any issuer (other than cash items and U.S.
government securities, as defined in the 1940 Act) if such purchase would
cause the Fund's holdings of that issuer to amount to more than 5% of the
Fund's total assets.

o The Fund will invest no more than 25% of its assets in a single issuer.

INDUSTRY CONCENTRATION

As a fundamental policy, the Fund will not invest more than 25% of its total
assets in any particular industry. This policy does not apply to U.S. government
securities.

PORTFOLIO TURNOVER

The Fund generally intends to purchase securities for long-term investment
rather than short-term gains. However, short-term transactions may result from
liquidity needs, securities having reached a price or yield objective, changes
in interest rates or the credit standing of an issuer, or by reason of economic
or other developments not foreseen at the time of the investment decision.
Changes are made in the Fund's portfolio whenever its portfolio managers believe
such changes are desirable. Portfolio turnover rates are generally not a factor
in making buy and sell decisions.

To a limited extent, the Fund may purchase securities in anticipation of
relatively short-term price gains. The Fund may also sell one security and
simultaneously purchase the same or a comparable security to take advantage of
short-term differentials in bond yields or securities prices. Increased
portfolio turnover may result in higher costs for brokerage commissions, dealer
mark-ups and other transaction costs and may also result in taxable capital
gains. Certain tax rules may restrict the Fund's ability to engage in short-term
trading if the security has been held for less than three months.

ILLIQUID INVESTMENTS

The Fund may invest up to 15% of its net assets in illiquid investments,
including restricted securities or private placements that are not deemed to be
liquid by Janus Capital. An illiquid investment is a security or other position
that cannot be disposed of quickly in the normal course of business. Some
securities cannot be sold to the U.S. public because of their terms or because
of SEC regulations. Janus Capital may determine that securities that cannot be
sold to the U.S. public but that can be sold to institutional investors (for
example, Rule 144A securities) are liquid. Janus Capital will follow guidelines
established by the Trustees of the Trust ("Trustees") in making liquidity
determinations for Rule 144A securities and certain other securities, including
privately placed commercial paper.

BORROWING AND LENDING

The Fund may borrow money and lend securities or other assets, as follows:

o The Fund may borrow money for temporary or emergency purposes in amounts up
to 25% of its total assets.

o The Fund may mortgage or pledge securities as security for borrowings in
amounts up to 15% of its net assets.

o As a fundamental policy, the Fund may lend securities or other assets if,
as a result, no more than 25% of its total assets would be lent to other
parties.

The Fund intends to seek permission from the SEC to borrow money from or lend
money to other funds that permit such transactions and for which Janus Capital
serves as investment adviser. All such borrowing and lending will be subject to
the above limits. There is no assurance that such permission will be granted.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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ADDITIONAL RISK FACTORS

INVESTMENTS IN SMALLER COMPANIES

SMALLER OR NEWER COMPANIES MAY SUFFER MORE SIGNIFICANT LOSSES AS WELL AS REALIZE
MORE SUBSTANTIAL GROWTH THAN LARGER OR MORE ESTABLISHED ISSUERS.

The Fund may invest in companies that have relatively small revenues, have a
small share of the market for their products or services, or have limited
geographic or product markets. Small companies may lack depth of management,
they may be unable to generate internally funds necessary for growth or
potential development or to generate such funds through external financing on
favorable terms, or they may be developing or marketing new products or services
for which markets are not yet established and may never become established. In
addition, such companies may be insignificant factors in their industries and
may become subject to intense competition from larger companies. Securities of
small companies held by the Fund may have limited trading markets that may be
subject to wide price fluctuations. Investments in such companies tend to be
more volatile and somewhat more speculative.

SPECIAL SITUATIONS

The Fund may invest in "special situations" from time to time. A special
situation arises when, in the opinion of the Fund's portfolio managers, the
securities of a particular issuer will be recognized and appreciate in value due
to a specific development with respect to that issuer. Developments creating a
special situation might include, among others, a new product or process, a
technological breakthrough, a management change or other extraordinary corporate
event, or differences in market supply of and demand for the security.
Investment in special situations may carry an additional risk of loss in the
event that the anticipated development does not occur or does not attract the
expected attention.

FOREIGN SECURITIES

INVESTMENTS IN FOREIGN SECURITIES, INCLUDING THOSE OF FOREIGN GOVERNMENTS,
INVOLVE GREATER RISKS THAN INVESTING IN COMPARABLE DOMESTIC SECURITIES.

Securities of some foreign companies and governments may be traded in the United
States, but most foreign securities are traded primarily in foreign markets. The
risks of foreign investing include:

o Currency Risk. The Fund may buy the local currency when it buys a foreign
currency denominated security and sell the local currency when it sells the
security. As long as the Fund holds a foreign security, its value will be
affected by the value of the local currency relative to the U.S. dollar.
When the Fund sells a foreign security, its value may be worth less in U.S.
dollars even though the security increases in value in its home country.
U.S. dollar denominated securities of foreign issuers may also be affected
by currency risk.

o Transaction Costs. Transaction costs of buying and selling foreign
securities, including brokerage, tax and custody costs, are generally
higher than those involved in domestic transactions.

FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS

The Fund may enter into futures contracts on securities, financial indices and
foreign currencies and options on such contracts ("futures contracts") and may
invest in options on securities, financial indices and foreign currencies
("options"), forward contracts and interest rate swaps and swap-related products
(collectively "derivative instruments"). The Fund intends to use most derivative
instruments primarily to hedge the value of its portfolio against potential
adverse movements in securities prices, foreign currency markets or interest
rates. To a limited extent, the Fund may also use derivative instruments for
non-hedging purposes such as seeking to increase the Fund's income or otherwise
seeking to enhance return. Please refer to Appendix A to this Prospectus and the
SAI for a more detailed discussion of these instruments.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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The use of derivative instruments exposes the Fund to additional investment
risks and transaction costs. Risks inherent in the use of derivative instruments
include:

o the risk that interest rates, securities prices and currency markets will
not move in the direction that the portfolio managers anticipate;

o imperfect correlation between the price of derivative instruments and
movements in the prices of the securities, interest rates or currencies
being hedged;

o the fact that skills needed to use these strategies are different from
those needed to select portfolio securities;

o inability to close out certain hedged positions to avoid adverse tax
consequences;

o leverage risk, that is, the risk that adverse price movements in an
instrument can result in a loss substantially greater than the Fund's
initial investment in that instrument (in some cases, the potential loss is
unlimited); and

o particularly in the case of privately negotiated instruments, the risk that
the counterparty will fail to perform its obligations, which could leave
the Fund worse off than if it had not entered into the position.

Although the Fund believes the use of derivative instruments will benefit the
Fund, the Fund's performance could be worse than if the Fund had not used such
instruments if the portfolio manager's judgement proves incorrect.

When the Fund invests in a derivative instrument, it may be required to
segregate cash and other high-grade liquid assets or certain portfolio
securities with its custodian to "cover" the Fund's position. Assets segregated
or set aside generally may not be disposed of so long as the Fund maintains the
positions requiring segregation or cover. Segregating assets could diminish the
Fund's return due to the opportunity losses of foregoing other potential
investments with the segregated assets.

HIGH-YIELD/HIGH-RISK SECURITIES

High-yield/high-risk securities (or "junk" bonds) are debt securities rated
below investment grade by the primary rating agencies Standard & Poor's Ratings
Services ("Standard & Poor's") and Moody's Investors Service, Inc. ("Moody's").
The Fund expects that its holdings of lower quality securities, if any, will
consist primarily of bonds rated in the highest two tiers of non-investment
grade securities.

The value of lower quality securities generally is more dependent on the ability
of the company to meet interest and principal payments (i.e., credit risk) than
is the case for higher quality securities. Conversely, the value of higher
quality securities may be more sensitive to interest rate movements than lower
quality securities. In addition, companies issuing high-yield securities may be
more vulnerable to real or perceived economic changes, political changes or
other developments adverse to the company and lower quality securities may have
less liquid markets than higher quality securities. Investments in companies
issuing high-yield securities are considered to be more speculative than higher
quality investments.

Please refer to the SAI for a description of bond rating categories.

See Appendix A for risks associated with certain other investments.

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PERFORMANCE TERMS

This section will help you understand various terms that are commonly used to
describe the Fund's performance. You may see references to these terms in our
newsletters, advertisements and in media articles. Our newsletters and
advertisements may include comparisons of the Fund's performance to the
performance of other mutual funds, mutual fund averages or recognized stock
market indices. The Fund generally measures performance in terms of total
return.

Cumulative total return represents the actual rate of return on an investment
for a specified period. The Financial Highlights table shows total return for a
single fiscal period. Cumulative total return is generally quoted for more than
one year (e.g., the life of the Fund). A cumulative total return does not show
interim fluctuations in the value of an investment.

Average annual total return represents the average annual percentage change of
an investment over a specified period. It is calculated by taking the cumulative
total return for the stated period and determining what constant annual return
would have produced the same cumulative return. Average annual returns for more
than one year tend to smooth out variations in the Fund's return and are not the
same as actual annual results.

THE FUND IMPOSES NO SALES OR OTHER CHARGES THAT WOULD AFFECT TOTAL RETURN
COMPUTATIONS. FUND PERFORMANCE FIGURES ARE BASED UPON HISTORICAL RESULTS AND ARE
NOT INTENDED TO INDICATE FUTURE PERFORMANCE. INVESTMENT RETURNS AND NET ASSET
VALUE WILL FLUCTUATE SO THAT AN INVESTOR'S SHARES, WHEN REDEEMED, MAY BE WORTH
MORE OR LESS THAN THEIR ORIGINAL COST.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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SHAREHOLDER'S MANUAL

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Although the Fund has discontinued public sales of its shares to new investors,
shareholders who maintain open accounts will be able to continue to purchase
shares and reinvest any dividends and capital gains distributions in additional
shares. In addition, the Fund will continue to accept new accounts which are
opened under taxpayer identification numbers that are identical to those for
existing Fund accounts.

Once a Fund account is closed, it may not be reopened. An account may be
considered closed and subject to redemption by the Fund in the circumstances
discussed under "Minimum Investment Policies" on page 8.

HOW TO GET IN TOUCH WITH JANUS

If you have any questions while reading this Prospectus, please call one of our
Investor Service Representatives at 1-800-525-3713 Monday-Friday: 8:00
a.m.-10:00 p.m., and Saturday: 10:00 a.m.-7:00 p.m., New York time.

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MINIMUM INVESTMENTS*

To open a new account $2,500
To open a new retirement or UGMA/UTMA account $ 500
To open a new account with an Automatic Investment Program $ 500**
To add to any type of an account $ 100

TYPES OF ACCOUNT OWNERSHIP

As discussed above, the Fund will accept new accounts opened under taxpayer
identification numbers identical to those on current Fund accounts. You can
establish the following types of accounts by completing the New Account
Application included with this Prospectus:

o Individual or Joint Ownership. Individual accounts are owned by one person.
Joint accounts have two or more owners.

o Trust. An established trust can open an account. The names of each trustee,
the name of the trust and the date of the trust agreement must be included
on the application.

o Business Accounts. Corporations and partnerships may also open an account.
The application must be signed by an authorized officer of the corporation
or a general partner of the partnership.

RETIREMENT ACCOUNTS

If you are eligible, you may set up your account under a tax-sheltered
retirement plan. A retirement plan allows you to shelter your investment income
and capital gains from current income taxes. A contribution to these plans may
also be tax deductible. Distributions from retirement plans are generally
subject to income tax and may be subject to an additional tax if withdrawn prior
to age 591/2.

Investors Fiduciary Trust Company serves as custodian for the retirement plans
offered by the Fund. There is an annual $12 fee per account to maintain your
retirement account. The maximum annual fee is $24 per taxpayer identification
number. You may pay the fee by check or have it automatically deducted from your
account (usually in December).

The following plans require a special application. For an application and more
details about our Retirement Plans, call 1-800-525-3713.

o Individual Retirement Account: An IRA allows individuals under the age of
70 1/2 with earned income to contribute up to the lesser of $2,000 or 100%
of compensation annually. Please refer to the Janus Funds IRA booklet for
complete information regarding IRAs.

o Profit Sharing or Money Purchase Pension Plan: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees
and themselves.

o Section 403(b)(7) Plan: Employees of educational organizations or other
qualifying, tax-exempt organizations may be eligible to participate in a
Section 403(b)(7) Plan.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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HOW TO OPEN YOUR JANUS ACCOUNT

If you are a current Fund shareholder and want to open another Fund account,
complete and sign the appropriate application. Please be sure to provide your
Social Security or taxpayer identification number on the application. Make your
check payable to Janus Funds. Send all items to one of following addresses:

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

INVESTOR SERVICE CENTERS

100 Fillmore Street, Suite 100
Denver, CO 80206

3773 Cherry Creek North Drive, Suite 101
Denver, CO 80209

MINIMUM INVESTMENT POLICIES

ACCOUNTS ESTABLISHED AFTER FEBRUARY 18, 1996

Any account opened after February 18, 1996, must meet the minimum
investment requirements described at page 7.

ACCOUNTS ESTABLISHED ON OR BEFORE FEBRUARY 18, 1996

o The minimum investment requirement remains at $1,000 ($250 for retirement
accounts and UGMA/UTMA accounts) for these accounts only.

o There is no minimum initial investment requirement for Automatic Monthly
Investment Program participants that continue to make subsequent automatic
investments of at least $50.

o Subsequent investments (other than automatic monthly investments) must meet
the $100 minimum.

ALL ACCOUNTS

Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 annual maintenance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
above or to close such accounts. This policy will apply to accounts
participating in the Automatic Monthly Investment Program only if your account
balance does not reach the required minimum initial investment or falls below
such minimum and you have discontinued monthly investments. This policy does not
apply to accounts that fall below the minimums solely as a result of market
fluctuations. It is expected that accounts will be valued and the $10 fee
assessed on the second Friday of September of each year. You will receive notice
before we charge the $10 fee or close your account so that you may increase your
account balance to the required minimum.

HOW TO PURCHASE SHARES

PAYING FOR SHARES

When you purchase shares, your request will be processed at the next NAV
calculated after your order is received and accepted. Please note the following:

o Cash, credit cards, third party checks and credit card checks will not be
accepted.

o All purchases must be made in U.S. dollars.

o Checks must be drawn on a U.S. bank and made payable to Janus Funds.

o If a check does not clear your bank, the Fund reserves the right to cancel
the purchase.

o If the Fund is unable to debit your predesignated bank account on the day
of purchase, it may make additional attempts or cancel the purchase.

o The Fund reserves the right to reject any specific purchase request.

If your purchase is cancelled you will be responsible for any losses or fees
imposed by your bank and losses that may be incurred as a result of any decline
in the value of the cancelled purchase. The Fund (or its agents) has the
authority to redeem shares in your account(s) to cover any such losses due to
fluctuations in share price. Any profit on such cancellation will accrue to the
Fund.

ONCE YOU HAVE OPENED YOUR JANUS ACCOUNT, THE MINIMUM AMOUNT FOR AN ADDITIONAL
INVESTMENT IS $100. You may add to your account at any time through any of the
following options:

BY MAIL

BY TELEPHONE

BY WIRE

Purchases may also be made by wiring money from your bank account to your Janus
account. Call 1-800-525-3713 to receive wiring instructions.

AUTOMATIC INVESTMENT PROGRAMS

o AUTOMATIC MONTHLY INVESTMENT PROGRAM
You select the day each month that your money ($100 minimum) will be
electronically transferred from your bank account to your Fund account. To
establish this option, complete the "Automatic Monthly Investment Program"
section on the application and attach a "voided" check or deposit slip from
your bank account. If your Fund account is already established, call
1-800-525-3713 to request the appropriate form.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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HOW TO EXCHANGE SHARES

On any business day, you may exchange all or a portion of your shares into any
other available Janus fund.

IN WRITING

To request an exchange in writing, please follow the instructions for written
requests on page 10.

BY TELEPHONE

BY SYSTEMATIC EXCHANGE

If the balance in the account you are exchanging from falls below the systematic
exchange amount, all remaining shares will be exchanged and the program will be
discontinued.

EXCHANGE POLICIES

o Except for Systematic Exchanges, new accounts established by exchange must
meet the $2,500 minimum, or be for the total account value if less than
$2,500.

o Exchanges between existing accounts must meet the $100 subsequent
investment requirement.

o You may make four exchanges out of the Fund during a calendar year
(exclusive of Systematic Exchanges) free of charge. The Fund reserves the
right to have a $5 transaction fee automatically deducted from your account
for each additional exchange.

o Exchanges between accounts will be accepted only if the registrations are
identical.

o If the shares you are exchanging are held in certificate form, you must
return the certificate to the Fund prior to making any exchanges.

o Be sure to read the prospectus for the fund into which you are exchanging.

o The Fund reserves the right to reject any exchange request and to modify or
terminate the exchange privilege at any time. For example, the Fund may
reject exchanges from accounts engaged in excessive trading (including
market timing transactions) that are detrimental to the Fund.

o An exchange represents the sale of shares from one fund and the purchase of
shares of another fund, which may produce a taxable gain or loss in a
non-tax deferred account.

QUICK ADDRESS AND TELEPHONE REFERENCE

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

Janus Investor Services 1-800-525-3713
To speak to a service representative

JETS(R) 1-800-525-6125
For 24-hour access to account and fund information.

TDD 1-800-525-0056
A telecommunications device for our hearing- and speech-impaired shareholders.

Janus QuotelineSM 1-800-525-0024
For automated daily quotes on fund share prices, yields and total returns.

Janus Literature Line 1-800-525-8983
To request a prospectus, shareholder reports or marketing materials.

HOW TO REDEEM SHARES

On any business day, you may redeem all or a portion of your shares. REMEMBER
THAT THE FUND IS CLOSED TO NEW INVESTORS AND IF A TOTAL REDEMPTION IS MADE
ADDITIONAL INVESTMENTS IN YOUR FUND ACCOUNT MIGHT NOT BE POSSIBLE.

If the shares are held in certificate form, the certificate must be returned
with or before your redemption request. Your transaction will be processed at
the next NAV calculated after your order is received and accepted.

IN WRITING

To request a redemption in writing, please follow the instructions for written
requests noted on page 10.

BY TELEPHONE

SYSTEMATIC WITHDRAWAL PLAN ("SWP")

SWPs allow you to redeem a specific dollar amount from your Fund account on a
regular basis. For more information on SWPs or to request the appropriate form,
please call 1-800-525-3713.

PAYMENT OF REDEMPTION PROCEEDS

o BY CHECK
Redemption proceeds will be sent to the shareholder(s) of record at the
address of record within seven days after receipt of a valid redemption
request.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
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IF THE SHARES BEING REDEEMED WERE PURCHASED BY CHECK, TELEPHONE OR THROUGH THE
AUTOMATIC MONTHLY INVESTMENT PROGRAM, THE FUND MAY DELAY THE PAYMENT OF YOUR
REDEMPTION PROCEEDS FOR UP TO 15 DAYS FROM THE DAY OF PURCHASE TO ALLOW THE
PURCHASE TO CLEAR. Unless you provide alternate instructions, your proceeds will
be invested in Janus Money Market Fund - Investor Shares during the 15 day hold
period.

WRITTEN INSTRUCTIONS

To redeem all or part of your shares in writing, your request should be sent to
one of the addresses listed on page 8 and must include the following
information:

o the name of the Fund
o the account number
o the amount of money or number of shares being redeemed
o the name(s) on the account registration
o the signature(s) of all registered account owners
o your daytime telephone number

o SIGNATURE REQUIREMENTS BASED ON ACCOUNT TYPE

o Individual, Joint Tenants, Tenants in Common: Written instructions must be
signed by each shareholder, exactly as the names appear in the account
registration.

o UGMA or UTMA: Written instructions must be signed by the custodian in
his/her capacity as it appears in the account registration.

o Sole Proprietor, General Partner: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

o Trust: Written instructions must be signed by the trustee(s). If the
name(s) of the current trustee(s) does not appear in the account
registration, a certificate of incumbency dated within 60 days must also be
submitted.

PRICING OF FUND SHARES

All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved. The Fund's NAV is
calculated at the close of the regular trading session of the New York Stock
Exchange (the "NYSE") (normally 4:00 p.m. New York time) each day that the NYSE
is open. In order to receive a day's price, your order must be received by the
close of the regular trading session. NAV per share is calculated by dividing
the total value of the Fund's securities and other assets, less liabilities, by
the total number of shares outstanding. Securities are valued at market value
or, if a market quotation is not readily available, at their fair value
determined in good faith under procedures established by and under the
supervision of the Trustees. Short-term instruments maturing within 60 days are
valued at amortized cost, which approximates market value. See the SAI for more
detailed information.

SIGNATURE GUARANTEE

In addition to the signature requirements, a signature guarantee is also
required if any of the following is applicable:

o The redemption exceeds $100,000.

o You would like the check made payable to anyone other than the
shareholder(s) of record.

o You would like the check mailed to an address which has been changed within
10 days of the redemption request.

o You would like the check mailed to an address other than the address of
record.

THE FUND RESERVES THE RIGHT TO REQUIRE A SIGNATURE GUARANTEE UNDER OTHER
CIRCUMSTANCES OR TO REJECT OR DELAY A REDEMPTION ON CERTAIN LEGAL GROUNDS. FOR
MORE INFORMATION PERTAINING TO SIGNATURE GUARANTEES, PLEASE CALL 1-800-525-3713.

HOW TO OBTAIN A SIGNATURE GUARANTEE

A signature guarantee assures that a signature is genuine. The signature
guarantee protects shareholders from unauthorized account transfers. The
following financial institutions may guarantee signatures: banks, savings and
loan associations, trust companies, credit unions, broker-dealers and member
firms of a national securities exchange. Call your financial institution to see
if they have the ability to guarantee a signature. A SIGNATURE GUARANTEE MAY NOT
BE PROVIDED BY A NOTARY PUBLIC.

If you live outside the United States, a foreign bank properly authorized to do
business in your country of residence or a U.S. consulate may be able to
authenticate your signature.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
10
<PAGE>

SHAREHOLDER SERVICES AND ACCOUNT POLICIES

JANUS ELECTRONIC TELEPHONE SERVICE (JETS(R))

TRANSACTIONS THROUGH PROCESSING ORGANIZATIONS

You may purchase or sell Fund shares through a broker-dealer, bank or other
financial institution, or an organization that provides recordkeeping and
consulting services to 401(k) plans or other qualified plans (a "Processing
Organization"). Processing Organizations may charge you a fee for this service
and may require different minimum initial and subsequent investments than the
Fund. A Processing Organization may also impose other charges or restrictions
different from those applicable to shareholders who invest in the Fund directly.
The Processing Organization, rather than its customer, may be the shareholder of
record of your shares. The Fund is not responsible for the failure of any
Processing Organization to carry out its obligations to its customers. Certain
Processing Organizations may receive compensation from Janus Capital or its
affiliates and certain Processing Organizations may receive compensation from
the Fund for shareholder recordkeeping and similar services.

TAXPAYER IDENTIFICATION NUMBER

On your application or other appropriate form, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that you
are not subject to backup withholding for failing to report income to the IRS.
If you are subject to the 31% backup withholding or you did not certify your
taxpayer identification, the IRS requires the Fund to withhold 31% of any
dividends paid and redemption or exchange proceeds. In addition to the 31%
backup withholding, you may be subject to a $50 fee to reimburse the Fund for
any penalty that the IRS may impose.

SHARE CERTIFICATES

Most shareholders choose not to hold their shares in certificate form because
account transactions such as exchanges and redemptions cannot be completed until
the certificate has been returned to the Fund. The Fund will issue share
certificates upon written request only. Share certificates will not be issued
until the shares have been held for at least 15 days and will not be issued for
accounts that do not meet the minimum investment requirements. Share
certificates cannot be issued for retirement accounts. In addition, if the
certificate is lost, there may be a replacement charge.

INVOLUNTARY REDEMPTION

The Fund reserves the right to close an account if the shareholder is deemed to
engage in activities which are illegal or otherwise detrimental to the Fund.

TELEPHONE TRANSACTIONS

You may initiate many transactions by telephone. The Fund and its agents will
not be responsible for any losses resulting from unauthorized transactions when
procedures designed to verify the identity of the caller are followed.

It may be difficult to reach the Fund by telephone during periods of unusual
market activity. If you are unable to reach a representative by telephone,
please consider sending written instructions, stopping by a Service Center, or
in the case of exchanges, calling the JETS line.

TEMPORARY SUSPENSION OF SERVICES

The Fund or its agents may, in case of emergency, temporarily suspend telephone
transactions or other shareholder services.

ADDRESS CHANGES

To change the address on your account, call 1-800-525-3713 or send a written
request signed by all account owners. Include the name of the Fund, the account
number(s), the name(s) on the account and both the old and new addresses.
Certain options may be suspended for 10 days following an address change unless
a signature guarantee is provided.

REGISTRATION CHANGES

To change the name on an account, the shares are generally transferred to a new
account. In some cases, legal documentation may be required. For more
information call 1-800-525-3713.

STATEMENTS AND REPORTS

The Fund will send you a confirmation statement after every transaction that
affects your account balance or your account registration. If you are enrolled
in our Automatic Monthly Investment Program and invest on a monthly basis, you
will receive quarterly confirmation statements unless monthly statements are
requested. Statements will be mailed quarterly unless you instruct the Fund
otherwise. Information regarding the tax status of income dividends and capital
gains distributions will be mailed to shareholders on or before January 31st of
each year. Account tax information will also be sent to the IRS.

Financial reports for the Fund, which include a list of the Fund's portfolio
holdings, will be mailed semiannually to all shareholders. To reduce expenses,
only one copy of most financial reports will be mailed to accounts with the same
record address. Upon request, such reports will be mailed to all accounts in the
same household. Please call 1-800-525-3713 if you would like to receive
additional reports.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
11
<PAGE>

MANAGEMENT OF THE FUND

TRUSTEES

The Trustees oversee the business affairs of the Trust and are responsible for
major decisions relating to the Fund's investment objective and policies. The
Trustees delegate the day-to-day management of the Fund to the officers of the
Trust and meet at least quarterly to review the Fund's investment policies,
performance, expenses and other business affairs.

INVESTMENT ADVISER

Janus Capital, 100 Fillmore Street, Denver, Colorado 80206-4923, is the
investment adviser to the Fund and is responsible for the day-to-day management
of its investment portfolio and other business affairs.

Janus Capital has served as investment adviser to certain series of the Trust
since 1970 and currently serves as investment adviser to all of the Janus funds,
as well as adviser or subadviser to other mutual funds and individual,
corporate, charitable and retirement accounts.

Janus Capital furnishes continuous advice and recommendations concerning the
Fund's investments. Janus Capital also furnishes certain administrative,
compliance and accounting services for the Fund, and may be reimbursed by the
Fund for its costs in providing those services. In addition, Janus Capital
employees serve as officers of the Trust and Janus Capital provides office space
for the Fund and pays the salaries, fees and expenses of all Fund officers and
those Trustees who are affiliated with Janus Capital.

INVESTMENT PERSONNEL

James P. Goff is Executive Vice President and a co-manager of the Fund. Mr. Goff
joined Janus Capital in 1988. He has managed Janus Enterprise Fund since its
inception in September 1992 and has co-managed Janus Venture Fund since December
1993. He holds a Bachelor of Arts in Economics from Yale University and is a
Chartered Financial Analyst.

- --------------------------------------------------------------------------------

Warren B. Lammert is Executive Vice President and a co-manager of the Fund. Mr.
Lammert joined Janus Capital in 1987. He has managed Janus Mercury Fund since
its inception in May 1993 and Janus Balanced Fund from its inception in
September 1992 to December 1993, and has co-managed Janus Venture Fund since
December 1993. He holds a Bachelor of Arts in Economics from Yale University and
a Master of Science in Economic History from the London School of Economics and
is a Chartered Financial Analyst.

- --------------------------------------------------------------------------------

PERSONAL INVESTING

Janus Capital permits investment and other personnel to purchase and sell
securities for their own accounts, subject to Janus Capital's policy governing
personal investing. Janus Capital's policy requires investment and other
personnel to conduct their personal investment activities in a manner that Janus
Capital believes is not detrimental to the Fund or Janus Capital's other
advisory clients. See the SAI for more detailed information.

BREAKDOWN OF MANAGEMENT EXPENSES AND EXPENSE LIMITS

The Fund pays Janus Capital a management fee which is accrued daily and paid
monthly. The advisory agreement with the Fund spells out the management fee and
other expenses that the Fund must pay. The Fund's management fee schedule
(expressed as an annual rate) is set out in the chart below.

Average Daily Net Annual Rate
Assets of Fund Percentage (%)
- -------------------------------------------
First $ 30 Million 1.00%
Next $270 Million .75%
Next $200 Million .70%
Over $500 Million .65%
- -------------------------------------------

The actual management fee paid by the Fund for the fiscal year ended October 31,
1995 was 0.68% of the value of the Fund's average daily net assets. The Fund
incurs expenses not assumed by Janus Capital, including transfer agent and
custodian fees and expenses, legal and auditing fees, printing and mailing costs
of sending reports and other information to existing shareholders, and
independent Trustees' fees and expenses. Janus Capital will reduce its advisory
fee to the extent that Fund expenses exceed regulatory limits imposed by state
securities regulators.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
12
<PAGE>

PORTFOLIO TRANSACTIONS

Purchases and sales of securities on behalf of the Fund are executed by
broker-dealers selected by Janus Capital. Broker-dealers are selected on the
basis of their ability to obtain best price and execution for the Fund's
transactions and recognizing brokerage, research and other services provided to
the Fund and to Janus Capital. Janus Capital may also consider payments made by
brokers effecting transactions for the Fund i) to the Fund or ii) to other
persons on behalf of the Fund for services provided to the Fund for which it
would be obligated to pay. Janus Capital may also consider sales of shares of
the Fund as a factor in the selection of broker-dealers. The Fund's Trustees
have authorized Janus Capital to place portfolio transactions on an agency basis
with a broker-dealer affiliated with Janus Capital. When transactions for the
Fund are effected with that broker-dealer, the commissions payable by the Fund
are credited against certain Fund operating expenses. The SAI further explains
the selection of broker-dealers.

OTHER SERVICE PROVIDERS

The following parties provide the Fund with administrative and other services.

Domestic Custodian
Investors Fiduciary Trust Company
127 W. 10th Street
Kansas City, Missouri 64105

Foreign Custodian
State Street Bank and Trust Company
P.O. Box 351
Boston, Massachusetts 02101

Transfer Agent
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217

Distributor
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206

OTHER INFORMATION

ORGANIZATION

As of the date of this Prospectus, the Trust offers 18 separate series three of
which currently offer two classes of shares. The Fund became a series of the
Trust on August 7, 1992. It was previously known as Janus Venture Fund, Inc., a
Maryland corporation. All references in this Prospectus to the Fund prior to the
above date are to its predecessor entities and all references after such date
are to the series of the Trust.

The Trust currently offers the other 17 series by other prospectuses.

SHAREHOLDER MEETINGS

The Trust does not intend to hold annual shareholder meetings. However, special
meetings may be called specifically for the Fund or for the Trust as a whole for
purposes such as electing or removing Trustees, terminating or reorganizing the
Trust, changing fundamental policies, or for any other purpose requiring a
shareholder vote under the 1940 Act. Separate votes are taken by the Fund only
if a matter affects or requires the vote of just the Fund or that Fund's
interest in the matter differs from the interest of other portfolios of the
Trust. As a shareholder, you are entitled to one vote for each share that you
own.

SIZE OF THE FUND

The Fund has discontinued sales of its shares because its management believes
that a substantial increase in size may adversely affect the Fund's ability to
achieve its investment objective by reducing its flexibility in making
investments and in effecting portfolio changes. Although sales to new investors
have been discontinued, existing shareholders are permitted to continue to
purchase shares and to reinvest any dividends or capital gains distributions.
See the Shareholder's Manual beginning on page 7.

MASTER/FEEDER OPTION

The Trust may in the future seek to achieve the Fund's investment objective by
investing all of the Fund's assets in another investment company having the same
investment objective and substantially the same investment policies and
restrictions as those applicable to the Fund. It is expected that any such
investment company would be managed by Janus Capital in substantially the same
manner as the Fund. The Fund's shareholders of record on April 30, 1992, and the
initial shareholder(s) of all series of the Trust created after April 30, 1992,
voted to vest authority to use this investment structure in the sole discretion
of the Trustees. No further approval of the shareholders of the Fund is
required. You will receive at least 30 days' prior notice of any such
investment. Such investment would be made only if the Trustees determine it to
be in the best interests of the Fund and its shareholders. In making that
determination the Trustees will consider, among other things, the benefits to
shareholders and/or the opportunity to reduce costs and achieve operational
efficiencies. Although management of the Fund believes that the Trustees will
not approve an arrangement that is likely to result in higher costs, no
assurance is given that costs will be materially reduced if this option is
implemented.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
13
<PAGE>

DISTRIBUTIONS AND TAXES

- --------------------------------------------------------------------------------
DISTRIBUTIONS

THE INTERNAL REVENUE CODE REQUIRES THE FUND TO DISTRIBUTE NET INCOME AND ANY NET
GAINS REALIZED BY ITS INVESTMENTS ANNUALLY. THE FUND'S INCOME FROM DIVIDENDS AND
INTEREST AND ANY NET REALIZED SHORT-TERM CAPITAL GAINS ARE PAID TO SHAREHOLDERS
AS DIVIDENDS. NET REALIZED LONG-TERM GAINS ARE PAID TO SHAREHOLDERS AS CAPITAL
GAINS DISTRIBUTIONS. DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS ARE DECLARED AND
PAID IN DECEMBER.

HOW DISTRIBUTIONS AFFECT THE FUND'S NAV

Distributions are paid to shareholders as of the record date of the distribution
of the Fund, regardless of how long the shares have been held. Dividends and
capital gains awaiting distribution are included in the Fund's daily NAV. The
share price of the Fund drops by the amount of the distribution, net of any
subsequent market fluctuations. As an example, assume that on December 31, the
Fund declared a dividend in the amount of $0.25 per share. If the Fund's share
price was $10.00 on December 30, the Fund's share price on December 31 would be
$9.75, barring market fluctuations.

"BUYING A DIVIDEND"

If you purchase shares of the Fund just before the distribution, you will pay
the full price for the shares and receive a portion of the purchase price back
as a taxable distribution. This is referred to as "buying a dividend." In the
above example, if you bought shares on December 30, you would have paid $10.00
per share. On December 31, the Fund would pay you $0.25 per share as a dividend
and your shares would now be worth $9.75 per share. Unless your account is set
up as a tax-deferred account, dividends paid to you would be included in your
gross income for tax purposes, even though you may not have participated in the
increase in NAV of the Fund, whether or not you reinvested the dividends.

DISTRIBUTION OPTIONS

1. Reinvestment Option. You may reinvest your income dividends and capital
gains distributions in additional shares. This option is assigned
automatically if no other choice is made.

2. Cash Option. You may receive your income dividends and capital gains
distributions in cash.

3. Reinvest And Cash Option. You may receive either your income dividends or
capital gains distributions in cash and reinvest the other in additional
shares.

4. Redirect Option. You may direct your dividends or capital gains to purchase
shares of another Janus fund.

The Fund reserves the right to reinvest undeliverable and uncashed dividend and
distribution checks that remain outstanding for six months in shares of the Fund
at the NAV next computed after the check is cancelled. Subsequent distributions
may also be reinvested.

TAXES

As with any investment, you should consider the tax consequences of investing in
the Fund. The following discussion does not apply to tax-deferred retirement
accounts, nor is it a complete analysis of the federal tax implications of
investing in the Fund. You may wish to consult your own tax adviser.
Additionally, state or local taxes may apply to your investment, depending upon
the laws of your state of residence.

TAXES ON DISTRIBUTIONS

Dividends and distributions by the Fund are subject to federal income tax,
regardless of whether the distribution is made in cash or reinvested in
additional shares of the Fund. In certain states, a portion of the dividends and
distributions (depending on the source of the Fund's income) may be exempt from
state and local taxes. Information regarding the tax status of income dividends
and capital gains distributions will be mailed to shareholders on or before
January 31st of each year.

TAXATION OF THE FUND

Dividends, interest and some capital gains, received by the Fund on foreign
securities may be subject to tax withholding or other foreign taxes. Any foreign
taxes paid by the Fund will be treated as an expense to the Fund or passed
through to shareholders as a foreign tax credit, depending on particular facts
and circumstances. Tax conventions between certain countries and the United
States may reduce or eliminate such taxes.

The Fund does not expect to pay any federal income or excise taxes because it
intends to meet certain requirements of the Internal Revenue Code. It is
important that the Fund meet these requirements so that any earnings on your
investment will not be taxed twice.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
14
<PAGE>

APPENDIX A

GLOSSARY OF INVESTMENT TERMS

This glossary provides a more detailed description of some of the types of
securities and other instruments in which the Fund may invest. The Fund may
invest in these instruments to the extent permitted by its investment objective
and policies. The Fund is not limited by this discussion and may invest in any
other types of instruments not precluded by the policies discussed elsewhere in
this Prospectus. Please refer to the SAI for a more detailed discussion of
certain instruments.

I. EQUITY AND DEBT SECURITIES

Commercial paper is a short-term debt obligation with a maturity ranging from 1
to 270 days issued by banks, corporations and other borrowers to investors
seeking to invest idle cash. The Fund may purchase commercial paper issued under
Section 4(2) of the Securities Act of 1933.

Common stock represents a share of ownership in a company, and usually carries
voting rights and earns dividends. Unlike preferred stock, dividends on common
stocks are not fixed but are declared at the discretion of the issuer's board of
directors.

Convertible securities are preferred stocks or bonds that pay a fixed dividend
or interest payment and are convertible into common stock at a specified price
or conversion ratio.

High-yield/High-risk securities are securities that are rated below investment
grade by the primary rating agencies (BB or lower by Standard & Poor's and Ba or
lower by Moody's). Other terms commonly used to describe such securities include
"lower rated bonds," "noninvestment grade bonds" and "junk bonds."

Mortgage- and asset-backed securities are shares in a pool of mortgages or other
debt. These securities are generally pass-through securities, which means that
principal and interest payments on the underlying securities (less servicing
fees) are passed through to shareholders on a pro rata basis. These securities
involve prepayment risk, which is the risk that the underlying mortgages or
other debt may be refinanced or paid off prior to their maturities during
periods of declining interest rates. In that case, the portfolio managers may
have to reinvest the proceeds from the securities at a lower rate. Potential
market gains on a security subject to prepayment risk may be more limited than
potential market gains on a comparable security that is not subject to
prepayment risk.

Passive foreign investment companies (PFICs) are any foreign corporations which
generate certain amounts of passive income or hold certain amounts of assets for
the production of passive income. Passive income includes dividends, interest,
royalties, rents and annuities. Income tax regulations may require the Fund to
recognize income associated with a PFIC prior to the actual receipt of any such
income.

Repurchase agreements involve the purchase of a security by the Fund and a
simultaneous agreement by the seller (generally a bank or dealer) to repurchase
the security from the Fund at a specified date or upon demand. This technique
offers a method of earning income on idle cash. These securities involve the
risk that the seller will fail to repurchase the security, as agreed. In that
case, the Fund will bear the risk of market value fluctuations until the
security can be sold and may encounter delays and incur costs in liquidating the
security.

Reverse repurchase agreements involve the sale of a security by the Fund to
another party (generally a bank or dealer) in return for cash and an agreement
by the Fund to buy the security back at a specified price and time. This
technique will be used to provide cash to satisfy unusually heavy redemption
requests or for other temporary or emergency purposes.

Rule 144A securities are securities that are not registered for sale to the
general public under the Securities Act of 1933, but that may be resold to
certain institutional investors.

Standby commitments are obligations purchased by the Fund from a dealer that
give the Fund the option to sell a security to the dealer at a specified price.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
15
<PAGE>

government to purchase the agency's obligations and others are supported only by
the credit of the sponsoring agency.

Warrants are securities, typically issued with preferred stocks or bonds, that
give the holder the right to buy a proportionate amount of common stock at a
specified price, usually at a price that is higher than the market price at the
time of issuance of the warrant. The right may last for a period of years or
indefinitely.

When-issued, delayed delivery and forward transactions generally involve the
purchase of a security with payment and delivery at some time in the future -
i.e., beyond normal settlement. The Fund does not earn interest on such
securities until settlement and bears the risk of market value fluctuations in
between the purchase and settlement dates. New issues of stocks and bonds,
private placements and U.S. government securities may be sold in this manner.

Zero coupon bonds are debt securities that do not pay interest at regular
intervals, but are issued at a discount from face value. The discount
approximates the total amount of interest the security will accrue from the date
of issuance to maturity. Strips are debt securities that are stripped of their
interest (usually by a financial intermediary) after the securities are issued.
The market value of these securities generally fluctuates more in response to
changes in interest rates than interest-paying securities of comparable
maturity.

II. FUTURES, OPTIONS AND OTHER DERIVATIVES

Forward contracts are contracts to purchase or sell a specified amount of
property for an agreed upon price at a specified time. Forward contracts are not
currently exchange traded and are typically negotiated on an individual basis.
The Fund may enter into forward currency contracts to hedge against declines in
the value of non-dollar denominated securities or to reduce the impact of
currency appreciation on purchases of non-dollar denominated securities. It may
also enter into forward contracts to purchase or sell securities or other
financial indices.

Futures contracts are contracts that obligate the buyer to receive and the
seller to deliver an instrument or money at a specified price on a specified
date. The Fund may buy and sell futures contracts on foreign currencies,
securities and financial indices including interest rates or an index of U.S.
government, foreign government, equity or fixed-income securities. The Fund may
also buy options on futures contracts. An option on a futures contract gives the
buyer the right, but not the obligation, to buy or sell a futures contract at a
specified price on or before a specified date. Futures contracts and options on
futures are standardized and traded on designated exchanges.

Indexed/structured securities are typically short- to intermediate-term debt
securities whose value at maturity or interest rate is linked to currencies,
interest rates, equity securities, indices, commodity prices or other financial
indicators. Such securities may be positively or negatively indexed (i.e., their
value may increase or decrease if the reference index or instrument
appreciates). Indexed/structured securities may have return characteristics
similar to direct investments in the underlying instrument and may be more
volatile than the underlying instrument. The Fund bears the market risk of an
investment in the underlying instrument, as well as the credit risk of the
issuer.

Interest rate swaps involve the exchange by two parties of their respective
commitments to pay or receive interest (e.g., an exchange of floating rate
payments for fixed rate payments).

Options are the right, but not the obligation, to buy or sell a specified amount
of securities or other assets on or before a fixed date at a predetermined
price. The Fund may purchase and write put and call options on securities,
securities indices and foreign currencies.

JANUS VENTURE FUND PROSPECTUS FEBRUARY 18, 1996
16
<PAGE>

CONTENTS

FEE TABLE ................................................................. 1
FINANCIAL HIGHLIGHTS ...................................................... 2
INVESTMENT OBJECTIVES, POLICIES AND TECHNIQUES ............................ 3
INVESTMENT ADVISER AND ADMINISTRATOR ...................................... 6
DISTRIBUTIONS AND TAXES ................................................... 7
PERFORMANCE ............................................................... 8
MISCELLANEOUS INFORMATION ................................................. 8
SHAREHOLDER'S MANUAL
Types of Account Ownership ................................................ 9
How to Open an Account .................................................... 10
Minimum Investment Policies ............................................... 10
How to Purchase Shares .................................................... 10
How to Exchange Shares .................................................... 11
How to Redeem Shares ...................................................... 11
SHAREHOLDER SERVICES AND ACCOUNT POLICIES
Check Writing Privilege ................................................... 13
JETS(R) ................................................................... 13
Transactions Through Processing Organizations ............................. 13
Taxpayer Identification Number ............................................ 13
Share Certificates ........................................................ 13
Involuntary Redemptions ................................................... 13
Telephone Transactions .................................................... 13
Making Changes to Your Account ............................................ 13
Statements and Reports .................................................... 13

[LOGO]

JANUS MONEY MARKET FUND
JANUS GOVERNMENT MONEY MARKET FUND
JANUS TAX-EXEMPT MONEY MARKET FUND
INVESTOR SHARES

100 Fillmore Street
Denver, CO 80206-4923
1-800-525-3713

February 18, 1996

Janus Money Market Fund, Janus Government Money Market Fund and Janus Tax-Exempt
Money Market Fund (individually a "Fund" and collectively the "Funds") are
designed for investors who seek maximum current income consistent with stability
of capital. This prospectus offers a separate class of shares of each Fund
(collectively, the "Shares") to the general public. Each Fund is a separate
series of Janus Investment Fund (the "Trust"), an open-end management investment
company. Each Fund invests exclusively in high quality money market instruments.
AN INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S.
GOVERNMENT. THERE IS NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLE
NET ASSET VALUE OF $1.00 PER SHARE.

The Funds are no-load funds. They sell and redeem the Shares at net asset value
without any sales charges, commissions or redemption fees. There are no Rule
12b-1 plans or deferred sales charges. There is a low minimum initial investment
if shareholders choose the automatic monthly investing option described at page
10. The minimum initial investment is $2,500 ($500 for IRAs, most other
retirement plans and Uniform Gifts/Transfers to Minors accounts) and the minimum
subsequent investment is $100. An exchange program among other Janus funds is
also available. For complete details on how to purchase, redeem and exchange
Shares, please see the Shareholder's Manual beginning at page 9.

This prospectus contains information about the Shares that prospective investors
should consider before investing and should be read carefully and retained for
future reference. Additional information about the Shares is contained in the
Statement of Additional Information ("SAI") dated February 18, 1996, which is
filed with the Securities and Exchange Commission ("SEC") and is incorporated by
reference into this Prospectus. The SAI is available upon request and without
charge by writing or calling the Funds at the address or telephone number shown
above.

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SEC OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SEC OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY STATE OR
OTHER JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN
SUCH STATE OR OTHER JURISDICTION.

<PAGE>

FEE TABLE

SHAREHOLDER TRANSACTION EXPENSES (Applicable to each Fund)

Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees* None
Exchange Fee None

* An $8 service fee may be charged for redemptions by wire.

ANNUAL OPERATING EXPENSES*
(Expressed as a percentage of average net assets)

<TABLE>
<CAPTION>
Management Fee Other Expenses Total Operating Expenses
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Janus Money Market Fund-Investor Shares 0.10% 0.50% 0.60%
Janus Government Money Market Fund-Investor Shares 0.10% 0.50% 0.60%
Janus Tax-Exempt Money Market Fund-Investor Shares 0.10% 0.50% 0.60%
- ------------------------------------------------------------------------------------------------------------------
</TABLE>

*The information in the table above is based on expenses for the fiscal period
ended October 31, 1995, net of fee waivers from the investment adviser. Without
such waivers, the Management Fee, Other Expenses and Total Operating Expenses
would have been 0.20%, 0.50% and 0.70%, respectively. See "Investment Adviser
and Administrator" for a more detailed discussion of the fees. Janus Capital may
modify or terminate the waivers at any time upon 90 days' notice to the
Trustees.

EXAMPLE

You would indirectly pay the following expenses on a $1,000 investment, assuming
expense ratios remain as listed above and assuming a 5% annual return, with or
without redemption at the end of each period:

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Money Market Fund-Investor Shares $6 $19 $33 $75
Janus Government Money Market Fund-Investor Shares $6 $19 $33 $75
Janus Tax-Exempt Money Market Fund-Investor Shares $6 $19 $33 $75
- ------------------------------------------------------------------------------------------
</TABLE>

THE EXPENSES IN THE EXAMPLE ABOVE SHOULD NOT BE CONSIDERED A REPRESENTATION OF
PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN. THE ASSUMED 5% ANNUAL RETURN IS HYPOTHETICAL AND SHOULD NOT BE CONSIDERED
A REPRESENTATION OF PAST OR FUTURE ANNUAL RETURNS, WHICH MAY BE GREATER OR LESS
THAN THE ASSUMED AMOUNT.

The purpose of the preceding table and example is to assist the investor in
understanding the various costs and expenses that an investor in each Fund will
bear directly or indirectly. These expenses are described in greater detail
under "Investment Adviser and Administrator."

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
1
<PAGE>

FINANCIAL HIGHLIGHTS

The information below is for the period from February 15, 1995 (inception) to
October 31, 1995. The accounting firm of Price Waterhouse LLP has audited the
Funds' financial statements and their report is included in the Funds' Annual
Report, which is incorporated by reference into the SAI. Expense and income
ratios have been annualized while total returns have not been annualized.

<TABLE>
<CAPTION>
Janus Janus Janus
Money Market Government Money Market Tax-Exempt Money Market
Investor Shares Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
2. Net investment income .04 .04 .02
3. Net gains or (losses) on securities
(both realized and unrealized) -- -- --
4. Total from investment operations .04 .04 .02
Less distributions:
5. Dividends (from net investment income) (.04) (.04) (.02)
6. Distributions (from capital gains) -- -- --
7. Total distributions (.04) (.04) (.02)
8. Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
9. Total return 3.95% 3.90% 2.40%
10. Net assets, end of period (in thousands) $643,219 $119,307 $ 67,479
11. Ratio of expenses to average net assets 0.60%(1) 0.60%(1) 0.60%(1)
12. Ratio of net investment income
to average net assets 5.56% 5.40% 3.38%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)The ratio of expenses to average net assets was 0.70% before voluntary
reduction of fees.

UNDERSTANDING THE FINANCIAL HIGHLIGHTS

This section is designed to help you better understand the information
summarized in the Financial Highlights table. The table contains important
historical operating information that may be useful in making your investment
decision or understanding how your investment has performed. The Funds' Annual
Report contains additional information about each Fund's performance. For a copy
of the Annual Report, call 1-800-525-8983.

Total return is the percentage increase or decrease in the value of an
investment over a stated period of time. For the purposes of calculating total
return, it is assumed that dividends and distributions are reinvested at the NAV
on the day of the distribution. A FUND'S TOTAL RETURN CANNOT BE COMPUTED
DIRECTLY FROM THE FINANCIAL HIGHLIGHTS TABLES.

Ratio of expenses to average net assets is the total of a Fund's operating
expenses divided by its average net assets for the stated period.

Ratio of net investment income to average net assets is a Fund's net investment
income divided by its average net assets for the stated period.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
2
<PAGE>

INVESTMENT OBJECTIVES, POLICIES AND TECHNIQUES

Unless otherwise stated, the investment objectives and policies set forth in
this Prospectus are not fundamental and may be changed by the Trustees of the
Trust (the "Trustees") without shareholder approval. Shareholders will be
notified of material changes in investment objectives or policies. If there is a
change in the investment objective or policies of any Fund, shareholders should
consider whether that Fund remains an appropriate investment in light of their
then current financial position and needs. The Funds are subject to additional
investment policies and restrictions described in the SAI, some of which are
fundamental and may not be changed without shareholder approval.

INVESTMENT OBJECTIVES

The investment objective of each of Janus Money Market Fund and Janus Government
Money Market Fund is to seek maximum current income to the extent consistent
with stability of capital. The investment objective of Janus Tax-Exempt Money
Market Fund is to seek maximum current income that is exempt from federal income
taxes to the extent consistent with stability of capital. There can be no
assurance that a Fund will achieve its investment objective or that the Shares
will be able to maintain a stable net asset value of $1.00 per share.

COMMON INVESTMENT POLICIES

The Funds will invest only in eligible high quality, short-term money market
instruments that present minimal credit risks, as determined by Janus Capital
Corporation, the Funds' investment adviser ("Janus Capital"), pursuant to
procedures adopted by the Trustees. Each Fund may invest only in U.S.
dollar-denominated instruments that have a remaining maturity of 397 days or
less (as calculated pursuant to Rule 2a-7 under the Investment Company Act of
1940 ("1940 Act") and will maintain a dollar-weighted average portfolio maturity
of 90 days or less.

Except to the limited extent permitted by Rule 2a-7 and except for U.S.
Government Securities (as defined below), each Fund will not invest more than 5%
of its total assets in the securities of any one issuer. A guarantor is not
considered an issuer for the purpose of this limit provided that the value of
all securities held by a Fund that are issued or guaranteed by that institution
does not exceed 10% of the Fund's total assets. In the case of Janus Tax-Exempt
Money Market Fund, up to 25% of its assets may be invested without regard to the
foregoing limitations. To ensure adequate liquidity, no Fund may invest more
than 10% of its net assets in illiquid investments, including repurchase
agreements maturing in more than seven days and certain time deposits that are
subject to early withdrawal penalties and mature in more than seven days.
Because the Funds are typically used as a cash management vehicle, they intend
to maintain a high degree of liquidity. Janus Capital determines and monitors
the liquidity of portfolio securities under the supervision of the Trustees.

RATINGS.

High quality money market instruments include those that (i) are rated (or, if
unrated, are issued by an issuer with comparable outstanding short-term debt
that is rated) in one of the two highest rating categories for short-term debt
by any two nationally recognized statistical rating organizations ("NRSROs") or,
if only one NRSRO has issued a rating, by that NRSRO or (ii) are otherwise
unrated and determined by Janus Capital to be of comparable quality. Each Fund,
except Janus Tax-Exempt Money Market Fund, will invest at least 95% of its total
assets in securities in the highest rating category (as determined pursuant to
Rule 2a-7). Descriptions of the rating categories of Standard & Poor's Ratings
Services, Moody's Investors Service, Inc., and certain other NRSROs are
contained in the SAI as is a further description of the Funds' investment
policies.

Although each Fund only invests in high quality money market instruments, an
investment in a Fund is subject to risk even if all securities in a Fund's
portfolio are paid in full at maturity. All money market instruments, including
U.S. Government Securities, can change in value as a result of changes in
interest rates, the issuer's actual or perceived creditworthiness or the
issuer's ability to meet its obligations.

TYPES OF INVESTMENTS

JANUS MONEY MARKET FUND

Janus Money Market Fund pursues its objective by investing primarily in high
quality commercial paper and obligations of financial institutions. The Fund may
also invest in U.S. Government Securities (as defined below) and municipal
securities, although the Fund expects to invest in such securities to a lesser
degree.

DEBT OBLIGATIONS.

The Fund may invest in debt obligations of domestic issuers, including
commercial paper (short-term promissory notes issued by companies to finance
their, or their affiliates', current obligations), notes and bonds, and variable
amount master demand notes. The payment obligations on these instruments may be
backed by securities, swap agreements or other assets, by the guarantee of a
third party or solely by the unsecured promise of the issuer to make payments
when due. The Fund may invest in privately issued commercial paper or other
securities that are restricted as to disposition under the federal securities
laws. In general, sales of these securities may not be made absent registration
under the Securities Act of 1933 (the "1933 Act") or the availability of an
appropriate exemption therefrom. Pursuant to Section 4(2) of the 1933 Act or
Rule 144A adopted under the 1933 Act, however, some of these securities are
eligible for resale to institutional investors, and accordingly, Janus Capital
may determine that a liquid market exists for such a security pursuant to
guidelines adopted by the Trustees.

OBLIGATIONS OF FINANCIAL INSTITUTIONS.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
3
<PAGE>

assets in excess of one billion dollars and U.S. branches of foreign banks
having total assets in excess of ten billion dollars. The Fund may also invest
in Eurodollar and Yankee bank obligations as discussed below.

Certificates of deposit represent an institution's obligation to repay funds
deposited with it that earn a specified interest rate over a given period.
Bankers' acceptances are negotiable obligations of a bank to pay a draft which
has been drawn by a customer and are usually backed by goods in international
trade. Time deposits are non-negotiable deposits with a banking institution that
earn a specified interest rate over a given period. Fixed time deposits, which
are payable at a stated maturity date and bear a fixed rate of interest,
generally may be withdrawn on demand by the Fund but may be subject to early
withdrawal penalties that could reduce the Fund's yield. Unless there is a
readily available market for them, time deposits that are subject to early
withdrawal penalties and that mature in more than seven days will be treated as
illiquid securities.

EURODOLLAR OR YANKEE OBLIGATIONS.

The Fund may invest in Eurodollar and Yankee bank obligations. Eurodollar bank
obligations are dollar-denominated certificates of deposit or time deposits
issued outside the U.S. capital markets by foreign branches of U.S. banks and by
foreign banks. Yankee bank obligations are dollar-denominated obligations issued
in the U.S. capital markets by foreign banks.

Eurodollar (and to a limited extent, Yankee) bank obligations are subject to
certain sovereign risks. One such risk is the possibility that a foreign
government might prevent dollar-denominated funds from flowing across its
borders. Other risks include: adverse political and economic developments in a
foreign country; the extent and quality of government regulation of financial
markets and institutions; the imposition of foreign withholding taxes; and
expropriation or nationalization of foreign issuers.

U.S. GOVERNMENT SECURITIES.

The Fund may invest without limit in U.S. Government Securities as described
below under "Janus Government Money Market Fund."

MUNICIPAL SECURITIES.

The Fund may invest in obligations of states, territories or possessions of the
United States and their subdivisions, authorities and corporations as described
below under "Janus Tax-Exempt Money Market Fund." These obligations may pay
interest that is exempt from federal income taxation.

JANUS GOVERNMENT MONEY MARKET FUND

Janus Government Money Market Fund pursues its objective by investing
exclusively in obligations issued and/or guaranteed as to principal and interest
by the United States government or by its agencies and instrumentalities and
repurchase agreements secured by such obligations.

U.S. GOVERNMENT SECURITIES.

U.S. Government Securities shall have the meaning set forth in the 1940 Act. The
1940 Act defines U.S. Government Securities to include securities issued or
guaranteed by the U.S. government, its agencies and instrumentalities. U.S.
Government Securities may also include repurchase agreements collateralized by
and municipal securities escrowed with or refunded with U.S. government
securities. U.S. Government Securities in which the Fund may invest include U.S.
Treasury securities and obligations issued or guaranteed by U.S. government
agencies and instrumentalities that are backed by the full faith and credit of
the U.S. government, such as those guaranteed by the Small Business
Administration or issued by the Government National Mortgage Association. In
addition, U.S. Government Securities in which the Fund may invest include
securities supported primarily or solely by the creditworthiness of the issuer,
such as securities of the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation and the Tennessee Valley Authority. There is no
guarantee that the U.S. government will support securities not backed by its
full faith and credit. Accordingly, although these securities have historically
involved little risk of loss of principal if held to maturity, they may involve
more risk than securities backed by the full faith and credit of the U.S.
government.

JANUS TAX-EXEMPT MONEY MARKET FUND

Janus Tax-Exempt Money Market Fund pursues its objective by investing primarily
in municipal securities whose interest is exempt from federal income taxes,
including the federal alternative minimum tax. Although the Fund will attempt to
invest substantially all of its assets in municipal securities whose interest is
exempt from federal income taxes, the Fund reserves the right to invest up to
20% of the value of its net assets in securities whose interest is federally
taxable. Additionally, when its portfolio manager is unable to locate investment
opportunities with desirable risk/reward characteristics, the Fund may invest
without limit in cash and cash equivalents, including obligations that may be
federally taxable (See "Taxable Investments").

MUNICIPAL SECURITIES.

The municipal securities in which the Fund may invest include municipal notes
and short-term municipal bonds. Municipal notes are generally used to provide
for the issuer's short-term capital needs and generally have maturities of 397
days or less. Examples include tax anticipation and revenue anticipation notes,
which generally are issued in anticipation of various seasonal revenues, bond
anticipation notes, construction loan notes and tax-exempt commercial paper.
Short-term municipal bonds may include "general obligation bonds," which are
secured by the issuer's pledge of its faith, credit and taxing power for payment
of principal and interest; "revenue bonds," which are generally paid from the
revenues of a particular facility or a specific excise tax or other source; and
"industrial development bonds," which are issued by or on behalf of public
authorities to provide funding for various privately operated industrial and
commercial facilities. The Fund may also invest in high quality participation
interests in municipal securities. A more detailed description of various types
of municipal securities is contained in Appendix B in the SAI.

When the assets and revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government creating the
issuing entity and

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
4
<PAGE>

a security is backed only by the assets and revenues of the issuing entity, that
entity will be deemed to be the sole issuer of the security. Similarly, in the
case of an industrial development bond backed only by the assets and revenues of
the non-governmental issuer, the non-governmental issuer will be deemed to be
the sole issuer of the bond.

At times, the Fund may invest more than 25% of the value of its total assets in
tax-exempt securities that are related in such a way that an economic, business,
or political development or change affecting one such security could similarly
affect the other securities; for example, securities whose issuers are located
in the same state, or securities whose interest is derived from revenues of
similar type projects. The Fund may also invest more than 25% of its assets in
industrial development bonds or participation interests therein.

Yields on municipal securities are dependent on a variety of factors, including
the general conditions of the money market and of the municipal bond and
municipal note markets, the size of a particular offering, the maturity of the
obligation and the rating of the issue. The achievement of the Fund's investment
objective is dependent in part on the continuing ability of the issuers of
municipal securities in which the Fund invests to meet their obligations for the
payment of principal and interest when due. Obligations of issuers of municipal
securities are subject to the provisions of bankruptcy, insolvency and other
laws affecting the rights and remedies of creditors, such as the Bankruptcy
Reform Act of 1978, as amended. Therefore, the possibility exists, that as a
result of litigation or other conditions, the ability of any issuer to pay, when
due, the principal of and interest on its municipal securities may be materially
affected.

MUNICIPAL LEASES.

The Fund may invest in municipal leases or participation interests therein.
Municipal leases are municipal securities which may take the form of a lease or
an installment purchase or conditional sales contract. Municipal leases are
issued by state and local governments and authorities to acquire a wide variety
of equipment and facilities. Lease obligations may not be backed by the issuing
municipality's credit and may involve risks not normally associated with general
obligation bonds and other revenue bonds. For example, their interest may become
taxable if the lease is assigned and the holders may incur losses if the issuer
does not appropriate funds for the lease payment on an annual basis, which may
result in termination of the lease and possible default. Janus Capital may
determine that a liquid market exists for municipal lease obligations pursuant
to guidelines established by the Trustees.

TAXABLE INVESTMENTS.

As discussed above, although the Fund will attempt to invest substantially all
of its assets in municipal securities whose interest is exempt from federal
income tax, the Fund may under certain circumstances invest in certain
securities whose interest is subject to such taxation. These securities include:
(i) short-term obligations of the U.S. government, its agencies or
instrumentalities, (ii) certificates of deposit, bankers' acceptances and
interest-bearing savings deposits of banks having total assets of more than one
billion dollars and whose deposits are insured by the Federal Deposit Insurance
Corporation, (iii) commercial paper and (iv) repurchase agreements as described
below covering any of the securities described in items (i)-(iii) above or any
other obligations of the U.S. government, its agencies or instrumentalities.

COMMON INVESTMENT TECHNIQUES

PARTICIPATION INTERESTS.

The Funds may invest in participation interests in any type of security in which
the Funds may invest. A participation interest gives a Fund an undivided
interest in the underlying securities in the proportion that the Fund's
participation interest bears to the total principal amount of the underlying
securities. Participation interests usually carry a demand feature, as described
below, backed by a letter of credit or guarantee of the institution that issued
the interests permitting the holder to tender them back to the institution.

DEMAND FEATURES.

The Funds may invest in securities that are subject to puts and stand-by
commitments ("demand features"). Demand features give the Fund the right to
resell securities at specified periods prior to their maturity dates to the
seller or to some third party at an agreed-upon price or yield. Securities with
demand features may involve certain expenses and risks, including the inability
of the issuer of the instrument to pay for the securities at the time the
instrument is exercised, non-marketability of the instrument and differences
between the maturity of the underlying security and the maturity of the
instrument. Securities may cost more with demand features than without them.
Demand features can serve three purposes: to shorten the maturity of a variable
or floating rate security, to enhance the instrument's credit quality and to
provide a source of liquidity. Demand features are often issued by third party
financial institutions, generally domestic and foreign banks. Accordingly, the
credit quality and liquidity of the Funds' investments may be dependent in part
on the credit quality of the banks supporting the Funds' investments. This will
result in exposure to risks pertaining to the banking industry, including the
foreign banking industry. Brokerage firms and insurance companies also provide
certain liquidity and credit support.

VARIABLE AND FLOATING RATE SECURITIES.

The securities in which the Funds invest may have variable or floating rates of
interest. These securities pay interest at rates that are adjusted periodically
according to a specified formula, usually with reference to some interest rate
index or market interest rate. Securities with ultimate maturities of greater
than 397 days may be purchased only pursuant to Rule 2a-7. Under that Rule, only
those long-term instruments that have demand features which comply with certain
requirements and certain variable rate U.S. Government Securities may be
purchased. Similar to fixed rate debt instruments, variable and floating rate
instruments are subject to changes in value based on changes in market interest
rates or changes in the issuer's or guarantor's creditworthiness. The rate of
interest on securities purchased

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
5
<PAGE>

by a Fund may be tied to short-term Treasury or other government securities or
indices on securities that are permissible investments of the Funds, as well as
other money market rates of interest. The Funds will not purchase securities
whose values are tied to interest rates or indexes that are not appropriate for
the duration and volatility standards of a money market fund.

MORTGAGE- AND ASSET-BACKED SECURITIES.

Janus Money Market Fund and Janus Government Money Market Fund may purchase
fixed or adjustable rate mortgage-backed securities issued by the Government
National Mortgage Association, Federal National Mortgage Association, the
Federal Home Loan Mortgage Corporation, or other governmental or
government-related entities. In addition, Janus Money Market Fund may purchase
other asset-backed securities, including securities backed by automobile loans,
equipment leases or credit card receivables. These securities directly or
indirectly represent a participation in, or are secured by and payable from,
fixed or adjustable rate mortgage or other loans which may be secured by real
estate or other assets. Unlike traditional debt instruments, payments on these
securities include both interest and a partial payment of principal. Prepayments
of the principal of underlying loans may shorten the effective maturities of
these securities and may result in a Fund having to reinvest proceeds at a lower
interest rate.

REPURCHASE AGREEMENTS.

Each Fund may seek additional income by entering into collateralized repurchase
agreements. Repurchase agreements are transactions in which a Fund purchases
securities and simultaneously commits to resell those securities to the seller
at an agreed-upon price on an agreed-upon future date. The resale price reflects
a market rate of interest that is not related to the coupon rate or maturity of
the purchased securities. If the seller of the securities underlying a
repurchase agreement fails to pay the agreed resale price on the agreed delivery
date, a Fund may incur costs in disposing of the collateral and may experience
losses if there is any delay in its ability to do so.

REVERSE REPURCHASE AGREEMENTS.

Each Fund may enter into reverse repurchase agreements. Reverse repurchase
agreements are transactions in which a Fund sells a security and simultaneously
commits to repurchase that security from the buyer at an agreed upon price on an
agreed upon future date. This technique will be used only for temporary or
emergency purposes, such as meeting redemption requests or to earn additional
income on portfolio securities.

DELAYED DELIVERY SECURITIES.

Each Fund may purchase securities on a when-issued or delayed delivery basis.
Securities so purchased are subject to market price fluctuation from the time of
purchase but no interest on the securities accrues to a Fund until delivery and
payment for the securities take place. Accordingly, the value of the securities
on the delivery date may be more or less than the purchase price. Forward
commitments will be entered into only when a Fund has the intention of taking
possession of the securities, but a Fund may sell the securities before the
settlement date if deemed advisable.

BORROWING AND LENDING.

Each Fund may borrow money for temporary or emergency purposes in amounts up to
25% of its total assets. A Fund may not mortgage or pledge securities except to
secure permitted borrowings. As a fundamental policy, a Fund will not lend
securities or other assets if, as a result, more than 25% of its total assets
would be lent to other parties; however, the Funds do not currently intend to
engage in securities lending. Each Fund intends to seek permission from the SEC
to borrow money from or lend money to other funds that permit such transactions
and are advised by Janus Capital. There is no assurance that such permission
will be granted.

INVESTMENT ADVISER AND ADMINISTRATOR

INVESTMENT ADVISER

Each Fund has a separate Investment Advisory Agreement with Janus Capital
Corporation, 100 Fillmore Street, Denver, Colorado 80206-4923. Janus Capital has
served as investment adviser to Janus Fund since 1970 and currently serves as
investment adviser to all of the Janus funds, as well as adviser or subadviser
to other mutual funds and individual, corporate, charitable and retirement
accounts. Kansas City Southern Industries, Inc., a publicly traded holding
company whose primary subsidiaries are engaged in transportation, information
processing and financial services ("KCSI"), owns approximately 83% of the
outstanding voting stock of Janus Capital. Thomas H. Bailey, the President and
Chairman of the Board of Janus Capital, owns approximately 12% of its voting
stock and by agreement with KCSI selects a majority of Janus Capital's Board.

Pursuant to the Investment Advisory Agreements, Janus Capital furnishes
continuous advice and recommendations concerning each Fund's investments. Each
of the Funds has agreed to compensate Janus Capital for its advisory services by
the monthly payment of a fee at the annual rate of 0.20% of the value of the
average daily net assets of each Fund. Until at least the period ending June 16,
1996, however, Janus Capital has agreed to waive a portion of its fee and
accordingly, the advisory fee of each Fund will be calculated at the annual rate
of 0.10% of the value of each Fund's average daily net assets.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
6
<PAGE>

ADMINISTRATOR

Each of the Funds has also entered into an Administration Agreement with Janus
Capital, pursuant to which Janus Capital furnishes certain administrative,
compliance and accounting services for the Funds, pays the costs of printing
reports and prospectuses for existing shareholders, provides office space for
the Funds and pays the salaries, fees and expenses of all Fund officers and of
those Trustees who are affiliated with Janus Capital. Administrative services
provided by Janus Capital under the Agreements include custody and transfer
agency services. Janus Capital is paid a fee, calculated daily and paid monthly,
at the annual rate of 0.50% of the value of the average daily net assets of each
Fund attributable to Shares for services rendered pursuant to the Administration
Agreements.

Each Fund pays all of its expenses not assumed by Janus Capital, including
auditing fees and independent Trustees' fees and expenses.

PORTFOLIO TRANSACTIONS

Purchase and sales of securities on behalf of each Fund are executed by brokers
and dealers selected by Janus Capital. Broker-dealers are selected on the basis
of their ability to obtain best price and execution for the Funds' transactions
and recognizing brokerage, research and other services provided to the Fund and
to Janus Capital. Janus Capital may also consider payments made by brokers
effecting transactions for a Fund i) to the Fund or ii) to other persons on
behalf of the Fund for services provided to the Fund for which it would be
obligated to pay. The Funds' Trustees have also authorized the Funds to place
portfolio transactions on an agency basis with a broker-dealer that is
affiliated with Janus Capital. Agency trades, if any, that are placed with such
affiliated party serve to reduce certain expenses of the Funds. The SAI further
explains the selection of broker-dealers.

PERSONAL INVESTING

Janus Capital permits investment personnel to purchase and sell securities for
their own accounts subject to Janus Capital's policy governing personal
investing. Janus Capital's policy requires investment and other personnel to
conduct their personal investment activities in a manner that Janus Capital
believes is not detrimental to the Funds and Janus Capital's other advisory
clients. See the SAI for more detailed information.

DISTRIBUTIONS AND TAXES

Dividends representing substantially all of the net investment income and any
net realized gains on sales of securities are declared daily, Saturdays, Sundays
and holidays included, and distributed on the last business day of each month.
If a month begins on a Saturday, Sunday or holiday, dividends for those days are
declared at the end of the preceding month and distributed on the first business
day of the month. Distributions will be reinvested in Shares of a Fund or paid
in cash at the election of the shareholder. If no election is made, all
distributions will be reinvested in additional Shares of a Fund.

Shares purchased by wire on a day on which the Funds calculate their net asset
value and the Federal Reserve Banks are open ("bank business day") will receive
that day's dividend if the purchase is effected prior to 3:00 p.m. (New York
time) for the Janus Money Market and Janus Government Money Market Funds and
12:00 p.m. (New York time) for Janus Tax-Exempt Money Market Fund. Otherwise,
such Shares begin to accrue dividends on the following bank business day. Orders
for purchase accompanied by a check or other negotiable bank draft will be
accepted and effected as of 4:00 p.m. (New York time) on the business day of
receipt and such Shares will begin to accrue dividends on the first bank
business day following receipt of the order.

Redemption orders effected on any particular day will generally receive
dividends declared through the day of redemption. However, redemptions made by
wire which are received prior to 3:00 p.m. (New York time) for the Janus Money
Market and Janus Government Money Market Funds and 12:00 p.m. (New York time)
for Janus Tax-Exempt Money Market Fund will result in Shares being redeemed that
day. Proceeds of such a redemption will normally be sent to the predesignated
account on that day, and that day's dividend will not be received. Requests for
redemptions made by wire which are received after 3:00 p.m. (12:00 p.m. for
Janus Tax-Exempt Money Market Fund) will be processed on that day and receive
that day's dividend, but will not be wired until the following bank business
day.

The Funds reserve the right to require purchase and redemption requests and
payments prior to these times on days when the bond market closes before 4:00
p.m.

Distributions for all of the Funds (except Janus Tax-Exempt Money Market Fund)
are taxable income and are subject to federal income tax (except for
shareholders exempt from income tax), whether such distributions are received in
cash or are reinvested in additional Shares. Full information regarding the tax
status of income dividends and any capital gains distributions will be mailed to
shareholders for tax purposes on or before January 31st of each year. Because
the Funds are money market funds, they do not anticipate making any capital
gains distributions.

Janus Tax-Exempt Money Market Fund anticipates that substantially all income
dividends it pays will be exempt from federal income tax. However, dividends
attributable to interest on taxable investments, together with distributions
from any net realized capital gains, are taxable. In addition, interest on
certain private activity bonds is a preference item for purposes of the
individual and corporate alternative minimum taxes. To the extent that the Fund
earns such income, shareholders who are subject to the alternative minimum tax
must include

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
7
<PAGE>

such income as a preference item. The Fund will advise shareholders of the
percentage of dividends, if any, subject to the alternative minimum tax.

Dividends and capital gains distributions may also be subject to state and local
taxes. In certain states some portion of dividends and distributions (depending
on the sources of the Fund's net income) of Janus Tax-Exempt Money Market Fund
may be exempt from state and local taxes. Shareholders should consult their own
tax advisor regarding exemption from any applicable state and local tax, as well
as the tax treatment of any dividends or distributions from the Shares.

The Funds intend to comply with provisions of the Internal Revenue Code
applicable to investment companies, and thus it is not expected that any of the
Funds will be required to pay any federal income or excise taxes. The SAI
further explains the Funds' tax status.

PERFORMANCE

The Shares may measure performance in several ways, including "yield,"
"effective yield," and "tax equivalent yield" (for Janus Tax-Exempt Money Market
Fund only). Yield is a way of showing the rate of income the Shares earn on
investments as a percentage of the Share price. Yield represents the income,
less expenses generated by an investment, in the Shares over a seven-day period
expressed as an annual percentage rate. Effective yield is similar in that it is
calculated over the same time frame, but instead the net investment income is
compounded and then annualized. Due to the compounding effect, the effective
yield will normally be higher than the yield.

Shares of Janus Tax-Exempt Money Market Fund may also quote tax-equivalent
yield, which shows the taxable yield an investor would have to earn before taxes
to equal such Shares' tax-free yield. A tax-equivalent yield is calculated by
dividing such Shares' tax-exempt yield by the result of one minus a stated
federal tax rate. Only that portion of the Fund's income that is tax-exempt is
adjusted in this calculation.

Performance figures are based upon historical results and are not intended to
indicate future performance.

From time to time in advertisements or sales material, the Funds may discuss the
Shares' performance ratings or other information as published by recognized
statistical or rating services, such as Lipper Analytical Services, Inc.,
IBC/Donoghue's Money Fund Report, Morningstar or by publications of general
interest, such as Forbes or Money. In addition, the Funds may compare the
Shares' yield to those of certain U.S. Treasury obligations or other money
market instruments.

MISCELLANEOUS INFORMATION

ORGANIZATION

Each Fund is an open-end management investment company registered under the 1940
Act as a series of the Trust, which was created on February 11, 1986. Each Fund
currently offers two classes of shares by separate prospectuses. The Shares
offered by this Prospectus are available to the general public, while
Institutional Shares of each Fund are available only to investors meeting the
minimum investment requirement of $250,000. Because the expenses of each class
may differ, the performance of each class is expected to differ. If you would
like additional information, please call 1-800-525-3713.

TRUSTEES

VOTING RIGHTS

The Trust is not required to hold annual shareholder meetings. However, special
meetings may be called for a specific class of shares, a specific Fund, or for
the Trust as a whole, for purposes such as electing or removing Trustees,
terminating or reorganizing the Trust, changing fundamental policies or voting
on matters when required by the 1940 Act. Separate votes are taken by a separate
Fund (or a separate class of shares) only if a matter affects or requires the
vote of just that Fund (or those shares). Shareholders are entitled to cast one
vote for each Share they own.

CUSTODIAN, TRANSFER AGENT AND DISTRIBUTOR

United Missouri Bank, N.A., P.O. Box 419226, Kansas City, Missouri 64141-6226,
is the custodian of the Funds' assets. The custodian holds each Fund's assets in
safekeeping and collects and remits the income thereon subject to the
instructions of each Fund.

Janus Service Corporation ("Janus Service"), P.O. Box 173375, Denver, Colorado
80217-3375, a wholly-owned subsidiary of Janus Capital, provides transfer agency
and shareholder services for the Funds.

Janus Distributors, Inc. ("Janus Distributors"), 100 Fillmore Street, Denver,
Colorado 80206-4923, a wholly-owned subsidiary of Janus Capital, is a
distributor of the Shares.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
8
<PAGE>

SHAREHOLDER'S MANUAL

HOW TO GET IN TOUCH WITH JANUS

If you have any questions while reading our prospectus, please call one of our
Investor Service Representatives at 1-800-525-3713 Monday-Friday: 8:00
a.m.-10:00 p.m., and Saturday: 10:00 a.m.-7:00 p.m., New York time.

- --------------------------------------------------------------------------------
MINIMUM INVESTMENTS*
To open a new account $2,500
To open a new retirement or UGMA/UTMA account $500
To open a new account with an Automatic Investment Program $500**
To add to any type of an account $100

*The Funds reserve the right to change the amount of these minimums from time to
time or to waive them in whole or in part for certain types of accounts.

**There is a $100 minimum subsequent investment.
- --------------------------------------------------------------------------------

TYPES OF ACCOUNT OWNERSHIP

o Individual or Joint Ownership. Individual accounts are owned by one person.
Joint accounts have two or more owners.

o Trust. An established trust can open an account. The names of each trustee,
the name of the trust and the date of the trust agreement must be included
on the application.

o Business Accounts. Corporations and partnerships may also open an account.
The application must be signed by an authorized officer of the corporation
or a general partner of the partnership.

RETIREMENT ACCOUNTS

If you are eligible, you may set up your account under a tax-sheltered
retirement plan. A retirement plan allows you to shelter your investment income
from current income taxes. A contribution to these plans may also be tax
deductible. Distributions from a retirement plan are generally subject to income
tax and may be subject to an additional tax if withdrawn prior to age 591/2.

The following plans require a special application. For an application and more
details about our Retirement Plans, call 1-800-525-3713.

o Profit Sharing or Money Purchase Pension Plan: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees
and themselves.

o Section 403(b)(7) Plan: Employees of educational organizations or other
qualifying, tax-exempt organizations may be eligible to participate in a
Section 403(b)(7) Plan.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
9
<PAGE>

HOW TO OPEN YOUR JANUS ACCOUNT

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

Investor Service Centers
Janus Funds offers two Investor Service Centers for those individuals who would
like to conduct their investing in person. Our representatives will be happy to
assist you at either of the following locations:

100 Fillmore Street, Suite 100
Denver, CO 80206

3773 Cherry Creek North Drive, Suite 101
Denver, CO 80209

MINIMUM INVESTMENT POLICIES

ACCOUNTS ESTABLISHED AFTER FEBRUARY 18, 1996

Any account opened after February 18, 1996, must meet minimum investment
requirements described at page 9.

ACCOUNTS ESTABLISHED ON OR BEFORE FEBRUARY 18, 1996

o The minimum initial investment requirement remains at $1,000 ($250 for
retirement accounts and UGMA/UTMA accounts) for these accounts only.

o There is no minimum investment requirement for Automatic Monthly Investment
Program participants that continue to make subsequent automatic investments
of at least $50.

o Subsequent investments (other than automatic monthly investments) must meet
the $100 minimum.

ALL ACCOUNTS

HOW TO PURCHASE SHARES

PAYING FOR SHARES

When you purchase shares, your request will be processed at the next NAV
calculated after your order is received and accepted. Please note the following:

o Cash, credit cards, third party checks and credit card checks will not be
accepted.

o All purchases must be made in U.S. dollars.

o Checks must be drawn on U.S. banks and made payable to Janus Funds.

o If a check does not clear your bank, the Funds reserve the right to cancel
the purchase.

o If the Funds are unable to debit your predesignated bank account on the day
of purchase, they may make additional attempts or cancel the purchase.

o The Funds reserve the right to reject any specific purchase request.

ONCE YOU HAVE OPENED YOUR JANUS ACCOUNT, THE MINIMUM AMOUNT FOR AN ADDITIONAL
INVESTMENT IS $100. You may add to your account at any time through any of the
following options:

BY MAIL

BY WIRE

Purchases may also be made by wiring money from your bank account to your Janus
account. Call 1-800-525-3713 to receive wiring instructions.

AUTOMATIC INVESTMENT PROGRAMS

o AUTOMATIC MONTHLY INVESTMENT PROGRAM
You select the day each month that your money ($100 minimum) will be
electronically transferred from your bank account to your Fund account. To
establish this option, complete the "Automatic Investing" section on the
application and attach a "voided" check or deposit slip from your bank
account. If your Fund account is already established, call 1-800-525-3713
to request the appropriate form.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
10
<PAGE>

HOW TO EXCHANGE SHARES

On any business day, you may exchange all or a portion of your shares into any
other available Janus fund.

IN WRITING

To request an exchange in writing, please follow the instructions for written
requests on page 12.

BY TELEPHONE

BY SYSTEMATIC EXCHANGE

EXCHANGE POLICIES

o Except for Systematic Exchanges, new accounts established by exchange must
meet the $2,500 minimum, or be for the total account value if less than
$2,500.

o Exchanges between existing accounts must meet the $100 subsequent
investment requirement.

o You may make four exchanges out of each non-money market fund during a
calendar year (exclusive of Systematic Exchanges) free of charge. You may
be charged a transaction fee for exchanges in excess of this limit. There
is currently no limit on exchanges out of the Shares described in this
prospectus.

o Exchanges between accounts will be accepted only if the registrations are
identical.

o If the shares in non-money market funds you are exchanging are held in
certificate form, you must return the certificate to your fund prior to
making any exchanges.

o Be sure that you read the prospectus for the Fund into which you are
exchanging.

o An exchange represents the sale of shares from one Fund and the purchase of
shares of another Fund, which may produce a taxable gain or loss in a
non-tax deferred account. Because the Funds seek to maintain a stable net
asset value per Share, it is not anticipated that a sale of Shares will
produce a taxable gain or loss.

QUICK ADDRESS AND TELEPHONE REFERENCE

Regular Mail
Janus Funds
P.O. Box 173375
Denver, CO 80217-3375

Express or Certified Mail
Janus Funds
100 Fillmore Street
Denver, CO 80206-4923

Janus Investor Services 1-800-525-3713
To speak to a service representative

JETS(R) 1-800-525-6125
For 24-hour access to account and fund information.

TDD 1-800-525-0056
A telecommunications device for our hearing- and speech-impaired shareholders.

Janus QuotelineSM 1-800-525-0024
For automated daily quotes on Fund share prices, yields and total returns.

Janus Literature Line 1-800-525-8983
To request a prospectus, shareholder reports or marketing materials.

HOW TO REDEEM SHARES

On any business day, you may redeem all or a portion of your shares. Your
transaction will be processed at the next NAV calculated after your order is
received and accepted.

IN WRITING

To request a redemption in writing, please follow the instructions for written
requests on page 12.

BY TELEPHONE

Most accounts have the telephone redemption option, unless this option was
specifically declined on the application or in writing. This option enables you
to redeem up to $100,000 on any business day from your account by simply calling
1-800-525-3713.

SYSTEMATIC WITHDRAWAL PLAN ("SWP")

SWPs allow you to redeem a specific dollar amount from your account on a regular
basis. For more information on SWPs or to request the appropriate form, please
call 1-800-525-3713.

PAYMENT OF REDEMPTION PROCEEDS

o BY CHECK
Redemption proceeds will be sent to the shareholder(s) of record at the
address of record within seven days after receipt of a valid redemption
request.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
11
<PAGE>

o BY WIRE
If you are authorized for the wire redemption service, your redemption
proceeds will be wired directly into your designated bank account on the
next bank business day after receipt of your redemption request. There is
no limitation on redemptions by wire; however, there is an $8 fee for each
wire and your bank may charge an additional fee to receive the wire. If you
would like to establish this option on an existing account, please call
1-800-525-3713 to request the appropriate form. Wire redemptions are not
available for retirement accounts.

WRITTEN INSTRUCTIONS

To redeem or exchange all or part of your shares in writing, your request should
be sent to one of the addresses listed on page 10 and must include the following
information:

SIGNATURE REQUIREMENTS BASED ON ACCOUNT TYPE

o Individual, Joint Tenants, Tenants in Common: Written instructions must be
signed by each shareholder, exactly as the names appear in the account
registration.

o UGMA or UTMA: Written instructions must be signed by the custodian in
his/her capacity as it appears in the account registration.

o Sole Proprietor, General Partner: Written instructions must be signed by an
authorized individual in his/her capacity as it appears in the account
registration.

PRICING OF FUND SHARES

All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved. A Fund's NAV is
calculated at the close of the regular trading session of the New York Stock
Exchange (the "NYSE") (normally 4:00 p.m. New York time) each day that the NYSE
is open. In order to receive a day's price, your purchase, redemption or
exchange order must be received by the close of the regular trading session of
the NYSE. The Funds reserve the right to require purchase, redemption and
exchange requests and payments prior to this time on days when the bond market
closes before the NYSE. NAV per share is calculated by dividing the total value
of a Fund's securities and other assets, less liabilities, by the total number
of shares outstanding. Portfolio securities are valued at their amortized cost.
Amortized cost valuation involves valuing an instrument at its cost and
thereafter assuming a constant amortization to maturity (or such other date as
permitted by Rule 2a-7) of any discount or premium. If fluctuating interest
rates cause the market value of a Fund's portfolio to deviate more than 1/2 of
1% from the value determined on the basis of amortized cost, the Trustees will
consider whether any action, such as adjusting the Share's NAV to reflect
current market conditions, should be initiated to prevent any material dilutive
effect on shareholders.

SIGNATURE GUARANTEE

In addition to the signature requirements, A SIGNATURE GUARANTEE IS ALSO
REQUIRED if any of the following is applicable:

o The redemption exceeds $100,000.

o You would like the check made payable to anyone other than the
shareholder(s) of record.

o You would like the check mailed to an address which has been changed within
10 days of the redemption request.

o You would like the check mailed to an address other than the address of
record.

HOW TO OBTAIN A SIGNATURE GUARANTEE

If you live outside the United States, a foreign bank properly authorized to do
business in your country of residence or a U.S. consulate may be able to
authenticate your signature.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
12
<PAGE>

SHAREHOLDER SERVICES AND ACCOUNT POLICIES

CHECK WRITING PRIVILEGE

Check writing privileges are available for all three Funds. Checkbooks will be
issued to shareholders who have completed a Signature Draft Card, which is sent
in the new account welcome package or by calling 1-800-525-3713. (There is no
checkwriting privilege for retirement accounts.) Your checkbook will be mailed
approximately 10 days after the check writing privilege is requested. Checks may
be written for any amount over but not less than $250 per check. Purchases made
by check or the Automatic Monthly Investment program may not be redeemed by a
redemption check until the 15-day hold period has passed. All checks written on
the account must be signed by all account holders unless otherwise specified on
the original application or the subsequent Signature Draft Card. The Funds
reserve the right to terminate or modify the check writing privilege at any
time.

JANUS ELECTRONIC TELEPHONE SERVICE ("JETS")(R)

JETS,(R) our electronic telephone service line, offers you 24-hour access by
TouchTone(TM) telephone to obtain information on your account balance, to
confirm your last transaction or the last dividend posted to your account, to
order duplicate account or tax statements, to reorder checks or to exchange your
Shares. JETS(R) can be accessed by calling 1-800-525-6125.
Calls on JETS(R) are limited to seven minutes.

TRANSACTIONS THROUGH PROCESSING ORGANIZATIONS

TAXPAYER IDENTIFICATION NUMBER

SHARE CERTIFICATES

Share certificates are not available for the Shares in order to maintain the
general liquidity that is representative of a money market fund and to help
facilitate transactions in shareholder accounts.

INVOLUNTARY REDEMPTIONS

The Funds reserve the right to close an account if the shareholder is deemed to
engage in activities which are illegal or otherwise detrimental to the Funds.

TELEPHONE TRANSACTIONS

TEMPORARY SUSPENSION OF SERVICES

The Funds or their agents may, in case of emergency, temporarily suspend
telephone transactions and other shareholder services.

ADDRESS CHANGES

REGISTRATION CHANGES

To change the name on an account, the shares are generally transferred to a new
account. In some cases, legal documentation may be required. For more
information, call 1-800-525-3713.

STATEMENTS AND REPORTS

The Funds will send you a confirmation statement after every transaction that
affects your account balance or your account registration. If you are enrolled
in our Automatic Monthly Investment Program and invest on a monthly basis, you
will receive quarterly confirmations on dividends. Generally, a statement with
tax information will be mailed to shareholders on or before January 31st of each
year. Account tax information will also be sent to the IRS.

JANUS MONEY MARKET FUNDS-INVESTOR SHARES PROSPECTUS FEBRUARY 18, 1996
13
<PAGE>

[LOGO]

JANUS MONEY MARKET FUND
JANUS GOVERNMENT MONEY MARKET FUND
JANUS TAX-EXEMPT MONEY MARKET FUND

Institutional Shares

100 Fillmore Street
Denver, CO 80206-4923
(800) 29JANUS

February 18, 1996

Janus Money Market Fund, Janus Government Money Market Fund, and Janus
Tax-Exempt Money Market Fund (individually, a "Fund" and, collectively, the
"Funds") are designed for investors who seek maximum current income consistent
with stability of capital. This prospectus offers a separate class of shares of
each Fund (collectively, the "Shares") exclusively to institutional and
individual clients meeting minimum investment requirements. Each Fund is a
separate series of Janus Investment Fund (the "Trust"), an open-end management
investment company.

Each Fund invests exclusively in high quality money market instruments. AN
INVESTMENT IN A FUND IS NEITHER INSURED NOR GUARANTEED BY THE U.S. GOVERNMENT.
THERE IS NO ASSURANCE THAT A FUND WILL BE ABLE TO MAINTAIN A STABLE NET ASSET
VALUE OF $1.00 PER SHARE.

The Shares are offered with no sales charges, commissions, redemption fees, Rule
12b-1 fees or deferred sales charges. The minimum initial investment is
$250,000. There is no minimum amount required for subsequent investments. For
complete details on how to purchase, redeem and exchange Shares, please see the
Shareholder's Guide beginning at page 10.

THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL SECURITIES IN ANY STATE OR
OTHER JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER IN
SUCH STATE OR OTHER JURISDICTION.

CONTENTS

FEE TABLE ................................................................. 2
FINANCIAL HIGHLIGHTS ...................................................... 3
INVESTMENT OBJECTIVES, POLICIES AND TECHNIQUES ............................ 4
INVESTMENT ADVISER AND ADMINISTRATOR ...................................... 7
DISTRIBUTIONS AND TAXES ................................................... 8
PERFORMANCE ............................................................... 9
MISCELLANEOUS INFORMATION ................................................. 9
SHAREHOLDER'S GUIDE
How to Open an Account .................................................... 10
Purchasing Shares ......................................................... 10
How to Exchange Shares .................................................... 11
How to Redeem Shares ...................................................... 11
Special Shareholder Services and Other Information ........................ 12

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
1
<PAGE>

FEE TABLE

SHAREHOLDER TRANSACTION EXPENSES (Applicable to each Fund)

Sales Load Imposed on Purchases None
Sales Load Imposed on Reinvested Dividends None
Deferred Sales Load None
Redemption Fees None
Exchange Fee None

ANNUAL OPERATING EXPENSES*
(Expressed as a percentage of average net assets)

<TABLE>
<CAPTION>
Management Fee Other Expenses Total Operating Expenses
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Janus Money Market Fund - Institutional Shares 0.10% 0.05% 0.15%
Janus Government Money Market Fund - Institutional Shares 0.10% 0.05% 0.15%
Janus Tax-Exempt Money Market Fund - Institutional Shares 0.10% 0.05% 0.15%
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>

*The information in the table above is based on expenses for the fiscal period
ended October 31, 1995, net of fee waivers from the investment adviser. Without
such waivers, the Management Fee, Other Expenses and Total Operating Expenses
would have been 0.20%, 0.15% and 0.35%, respectively. Janus Capital may modify
or terminate the waivers at any time upon 90 days' notice to the Trustees. See
"Investment Adviser and Administrator" for a more detailed discussion of the
fees.

EXAMPLE

<TABLE>
<CAPTION>
1 Year 3 Years 5 Years 10 Years
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Janus Money Market Fund - Institutional Shares $2 $5 $8 $19
Janus Government Money Market Fund - Institutional Shares $2 $5 $8 $19
Janus Tax-Exempt Money Market Fund - Institutional Shares $2 $5 $8 $19
- -----------------------------------------------------------------------------------------------
</TABLE>

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
2
<PAGE>

FINANCIAL HIGHLIGHTS

The information below is for the period from April 14, 1995 (inception) to
October 31, 1995. The accounting firm of Price Waterhouse LLP has audited the
Funds' financial statements and their report is included in the Funds' Annual
Report, which is incorporated by reference into the SAI. Expense and income
ratios have been annualized while total returns have not been annualized.

<TABLE>
<CAPTION>
Janus Janus Janus
Money Market Government Money Market Tax-Exempt Money Market
Institutional Shares Fund Fund Fund
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Net asset value, beginning of period $ 1.00 $ 1.00 $ 1.00
Income from investment operations:
2. Net investment income .03 .03 .02
3. Net gains or (losses) on securities
(both realized and unrealized) -- -- --
4. Total from investment operations .03 .03 .02
Less distributions:
5. Dividends (from net investment income) (.03) (.03) (.02)
6. Distributions (from capital gains) -- -- --
7. Total distributions (.03) (.03) (.02)
8. Net asset value, end of period $ 1.00 $ 1.00 $ 1.00
9. Total return 3.25% 3.20% 2.09%
10. Net assets, end of period (in thousands) $304,952 $ 44,164 $ 11,192
11. Ratio of expenses to average net assets 0.15%(1) 0.15%(1) 0.15%(1)
12. Ratio of net investment income
to average net assets 5.86% 5.75% 3.82%
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The ratio was .35% before voluntary reduction of fees.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
3
<PAGE>

INVESTMENT OBJECTIVES, POLICIES AND TECHNIQUES

INVESTMENT OBJECTIVES

The investment objective of Janus Money Market Fund and Janus Government Money
Market Fund is to seek maximum current income to the extent consistent with
stability of capital. The investment objective of Janus Tax-Exempt Money Market
Fund is to seek maximum current income that is exempt from federal income taxes
to the extent consistent with stability of capital. There can be no assurance
that a Fund will achieve its investment objective or that the Shares will be
able to maintain a stable net asset value of $1.00 per share.

COMMON INVESTMENT POLICIES

The Funds will invest only in eligible high quality, short-term money market
instruments that present minimal credit risks, as determined by Janus Capital
Corporation, the Funds' investment adviser ("Janus Capital"), pursuant to
procedures adopted by the Trustees. Each Fund may invest only in U.S.
dollar-denominated instruments that have a remaining maturity of 397 days or
less (as calculated pursuant to Rule 2a-7 under the Investment Company Act of
1940 ("1940 Act")) and will maintain a dollar-weighted average portfolio
maturity of 90 days or less.

Except to the limited extent permitted by Rule 2a-7 and except for U.S.
Government Securities (as defined below), each Fund will not invest more than 5%
of its total assets in the securities of any one issuer. A guarantor is not
considered an issuer for the purpose of this limit, provided that the value of
all securities held by a Fund that are issued or guaranteed by that institution
does not exceed 10% of the Fund's total assets. In the case of Janus Tax-Exempt
Money Market Fund, up to 25% of its assets may be invested without regard to the
foregoing limitations. To ensure adequate liquidity, no Fund may invest more
than 10% of its net assets in illiquid investments, including repurchase
agreements maturing in more than seven days and certain time deposits that are
subject to early withdrawal penalties and mature in more than seven days.
Because the Funds are typically used as a cash management vehicle, they intend
to maintain a high degree of liquidity. Janus Capital determines and monitors
the liquidity of portfolio securities under the supervision of the Trustees.

RATINGS.

High quality money market instruments include those that (i) are rated (or, if
unrated, are issued by an issuer with comparable outstanding short-term debt
that is rated) in one of the two highest rating categories for short-term debt
by any two nationally recognized statistical rating organizations ("NRSROs") or,
if only one NRSRO has issued a rating, by that NRSRO or (ii) are otherwise
unrated and determined by Janus Capital to be of comparable quality. Each Fund,
except Janus Tax-Exempt Money Market Fund, will invest at least 95% of its total
assets in securities in the highest rating category (as determined pursuant to
Rule 2a-7). Descriptions of the rating categories of Standard & Poor's Ratings
Services, Moody's Investors Service, Inc., and certain other NRSROs are
contained in the SAI, as is a further description of the Funds' investment
policies.

Although each Fund only invests in high quality money market instruments, an
investment in a Fund is subject to risk even if all securities in its portfolio
are paid in full at maturity. All money market instruments, including U.S.
Government Securities, can change in value as a result of changes in interest
rates, the issuer's actual or perceived creditworthiness or the issuer's ability
to meet its obligations.

TYPES OF INVESTMENTS

JANUS MONEY MARKET FUND

DEBT OBLIGATIONS.

OBLIGATIONS OF FINANCIAL INSTITUTIONS.

The Fund may invest in obligations of financial institutions. Examples of
obligations in which the Fund may invest include negotiable certificates of
deposit, bankers' acceptances and time deposits of U.S. banks (including savings
and loan associations) having total assets in excess of one billion dollars and
U.S. branches of foreign banks having total assets in excess of ten billion
dollars. The Fund may also invest in Eurodollar and Yankee bank obligations as
discussed below.

Certificates of deposit represent an institution's obligation to repay funds
deposited with it that earn a specified interest rate over

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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a given period. Bankers' acceptances are negotiable obligations of a bank to pay
a draft which has been drawn by a customer and are usually backed by goods in
international trade. Time deposits are non-negotiable deposits with a banking
institution that earn a specified interest rate over a given period. Fixed time
deposits, which are payable at a stated maturity date and bear a fixed rate of
interest, generally may be withdrawn on demand by the Fund but may be subject to
early withdrawal penalties that could reduce the Fund's yield. Unless there is a
readily available market for them, time deposits that are subject to early
withdrawal penalties and that mature in more than seven days will be treated as
illiquid securities.

EURODOLLAR OR YANKEE OBLIGATIONS.

U.S. GOVERNMENT SECURITIES.

The Fund may invest without limit in U.S. Government Securities as described
below under "Janus Government Money Market Fund."

MUNICIPAL SECURITIES.

JANUS GOVERNMENT MONEY MARKET FUND

U.S. GOVERNMENT SECURITIES.

JANUS TAX-EXEMPT MONEY MARKET FUND

MUNICIPAL SECURITIES.

When the assets and revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government creating the
issuing entity and a security is backed only by the assets and revenues of the
issuing entity, that entity will be deemed to be the sole issuer of the
security. Similarly, in the case of an industrial development bond backed only
by the assets and revenues of the non-governmental

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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issuer, the non-governmental issuer will be deemed to be the sole issuer of the
bond.

Yields on municipal securities are dependent on a variety of factors, including
the general conditions of the money market and of the municipal bond and
municipal note markets, the size of a particular offering, the maturity of the
obligation and the rating of the issue. The achievement of the Fund's investment
objective is dependent in part on the continuing ability of the issuers of
municipal securities in which the Fund invests to meet their obligations for the
payment of principal and interest when due. Obligations of issuers of municipal
securities are subject to the provisions of bankruptcy, insolvency and other
laws affecting the rights and remedies of creditors, such as the Bankruptcy
Reform Act of 1978, as amended. Therefore, the possibility exists that, as a
result of litigation or other conditions, the ability of any issuer to pay, when
due, the principal of and interest on its municipal securities may be materially
affected.

MUNICIPAL LEASES.

TAXABLE INVESTMENTS.

COMMON INVESTMENT TECHNIQUES

PARTICIPATION INTERESTS.

DEMAND FEATURES.

VARIABLE AND FLOATING RATE SECURITIES.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
6
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the duration and volatility standards of a money market fund.

MORTGAGE- AND ASSET-BACKED SECURITIES.

REPURCHASE AGREEMENTS.

REVERSE REPURCHASE AGREEMENTS.

Each Fund may enter into reverse repurchase agreements. Reverse repurchase
agreements are transactions in which a Fund sells a security and simultaneously
commits to repurchase that security from the buyer at an agreed upon price on an
agreed upon future date. This technique will be used only for temporary or
emergency purposes, such as meeting redemption requests, or to earn additional
income on portfolio securities.

DELAYED DELIVERY SECURITIES.

BORROWING AND LENDING.

INVESTMENT ADVISER AND ADMINISTRATOR

INVESTMENT ADVISER

Each Fund has a separate Investment Advisory Agreement with Janus Capital, 100
Fillmore Street, Denver, Colorado 80206-4923. Janus Capital has served as
investment adviser to Janus Fund since 1970 and currently serves as investment
adviser to all of the Janus funds, as well as adviser or subadviser to other
mutual funds and individual, corporate, charitable and retirement accounts.
Kansas City Southern Industries, Inc., a publicly traded holding company whose
primary subsidiaries are engaged in transportation, information processing and
financial services ("KCSI"), owns approximately 83% of the outstanding voting
stock of Janus Capital. Thomas H. Bailey, the President and Chairman of the
Board of Janus Capital, owns approximately 12% of its voting stock and, by
agreement with KCSI, selects a majority of Janus Capital's Board.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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ADMINISTRATOR

Each of the Funds has also entered into an Administration Agreement with Janus
Capital, pursuant to which Janus Capital furnishes certain administrative,
compliance and accounting services for the Funds, pays the costs of printing
reports and prospectuses for existing shareholders, provides office space for
the Funds and pays the salaries, fees and expenses of all Fund officers and of
those Trustees who are affiliated with Janus Capital. Administrative services
provided by Janus Capital under the Administration Agreements include custody
and transfer agency services. Janus Capital is paid a fee, calculated daily and
paid monthly, at the annual rate of 0.15% of the value of the average daily net
assets of each Fund attributable to Shares for services rendered pursuant to the
Administration Agreements. At least for the period ending June 16, 1996,
however, Janus Capital has agreed to waive a portion of its fee and accordingly,
the administration fee paid by the Shares will be calculated at the annual rate
of 0.05% of the value of each Fund's average daily net assets attributable to
the Shares.

Each Fund pays all of its expenses not assumed by Janus Capital, including
auditing fees and independent Trustees' fees and expenses.

PORTFOLIO TRANSACTIONS

Purchases and sales of securities on behalf of each Fund are executed by brokers
and dealers selected by Janus Capital. Broker-dealers are selected on the basis
of their ability to obtain best price and execution for the Funds' transactions
and recognizing brokerage, research and other services provided to the Fund and
to Janus Capital. Janus Capital may also consider payments made by brokers
effecting transactions for a Fund i) to the Fund or ii) to other persons on
behalf of the Fund for services provided to the Fund for which it would be
obligated to pay. The Funds' Trustees have also authorized the Funds to place
portfolio transactions on an agency basis with a broker-dealer that is
affiliated with Janus Capital. Agency trades, if any, that are placed with such
affiliated party serve to reduce certain expenses of the Funds. The SAI further
explains the selection of broker-dealers.

PERSONAL INVESTING

DISTRIBUTIONS AND TAXES

Dividends representing substantially all of the net investment income and any
net realized gains on sales of securities are declared daily, Saturdays, Sundays
and holidays included, and distributed on the last business day of each month.
If a month begins on a Saturday, Sunday or holiday, dividends for those days are
declared at the end of the preceding month and distributed on the first business
day of the month. Distributions will be reinvested in Shares of a Fund or wired
to a predesignated bank account at the election of the shareholder. If no
election is made, all distributions will be reinvested in additional Shares of a
Fund.

Redemption orders effected on any particular day will generally receive
dividends declared through the day of redemption. However, redemptions made by
wire which are received prior to 3:00 p.m. (New York time) for the Janus Money
Market and Janus Government Money Market Funds and 12:00 p.m. (New York time)
for Janus Tax-Exempt Money Market Fund will result in Shares being redeemed that
day. Proceeds of such a redemption will normally be sent to the predesignated
account on that day and that day's dividend will not be received. Requests for
redemptions made by wire which are received after 3:00 p.m. (12:00 p.m. for
Janus Tax-Exempt Money Market Fund) will be processed on that day and receive
that day's dividend, but will not be wired until the following bank business
day.

The Funds reserve the right to require purchase and redemption requests prior to
these times on days when the bond market closes before 4:00 p.m. (New York
time).

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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PERFORMANCE

Performance figures are based upon historical results and are not intended to
indicate future performance.

MISCELLANEOUS INFORMATION

ORGANIZATION

Each Fund is an open-end management investment company registered under the 1940
Act as a series of the Trust, which was created on February 11, 1986. Each Fund
currently offers two classes of shares by separate prospectuses. The Shares
offered by this Prospectus are available only to institutional clients,
including corporations, foundations and trusts, and individuals meeting certain
initial investment requirements, while Investor Shares of each Fund are
available to the general public. Because the expenses of each class may differ,
the performance of each class is expected to differ. If you would like
additional information, please call Janus Extended Services at 1-800-29JANUS.

SIGNIFICANT SHAREHOLDERS

As of December 1, 1995, the following individuals and/or corporations owned more
than 25% of the Shares of the following Funds: Western Digital Corporation owned
35.23% of Janus Government Money Market Fund - Institutional Shares and Thomas
F. Marsico and The Gap, Inc. owned 41.66% and 58.34%, respectively, of Janus
Tax-Exempt Money Market Fund - Institutional Shares. Thus, these shareholders
may have power to control any vote of the Shares of the Fund.

TRUSTEES

VOTING RIGHTS

CUSTODIAN, TRANSFER AGENT AND DISTRIBUTOR

Janus Service Corporation, P.O. Box 173375, Denver, Colorado 80217-3375, a
wholly-owned subsidiary of Janus Capital, provides transfer agency and
shareholder services for the Funds.

Janus Distributors, Inc., 100 Fillmore Street, Denver, Colorado 80206-4923, a
wholly-owned subsidiary of Janus Capital, is a distributor of the Shares.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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SHAREHOLDER'S GUIDE

HOW TO OPEN AN ACCOUNT

ESTABLISHING YOUR ACCOUNT

The Application enclosed with this Prospectus describes the options available to
you as an institutional shareholder of the Funds. After reviewing the
Application carefully, complete, sign and forward it to:

Via Regular Mail Via Express Mail - Overnight Delivery
Janus Funds Janus Funds
P.O. Box 173375 100 Fillmore Street
Denver, CO 80217-3375 Denver, CO 80206-4923
Attn: Extended Services Attn: Extended Services

Do not include any purchase money with the Application. All purchases of Shares
should be effected by wire transfer. See "Purchasing Shares." The Funds reserve
the right to suspend the offering of the Shares for a period of time and to
reject any specific purchase request.

You may set up your account for Investment Retirement Plan rollovers (in excess
of $250,000) under a tax-sheltered retirement plan. A retirement plan allows you
to shelter your investment income from current income taxes. A contribution to
these plans may also be tax deductible. Distributions from a retirement plan are
generally subject to income tax and may be subject to an additional tax if
withdrawn prior to age 591/2.

Please refer to the Janus Funds IRA booklet for complete information regarding
IRAs. You will need a special application to be enrolled in the plan. For an
application and more details, call 1-800-525-3713.

TAXPAYER IDENTIFICATION NUMBERS

On the application or other appropriate form, you will be asked to certify that
your Social Security or taxpayer identification number is correct and that you
are not subject to backup withholding for failing to report income to the IRS.
If you are subject to the 31% backup withholding or you did not certify your
taxpayer identification, the IRS requires the Funds to withhold 31% of any
dividends paid and redemption or exchange proceeds. In addition, to the 31%
backup withholding, you may be subject to a $50 fee to reimburse the Funds for
any penalty that the IRS may impose.

DISTRIBUTION OPTIONS

Shareholders have the option of having their dividends and distributions
automatically reinvested in Shares of a Fund or wired to a predesignated bank
account. If no election is made, all dividends and distributions will be
reinvested in additional Shares.

PURCHASING SHARES

You must establish a Fund account and receive an account number before making
purchases by wire. Requests to purchase Janus Money Market Fund and Janus
Government Money Market Fund received before 3:00 p.m. (New York time) on a
business day will receive dividends declared on the purchase date. Requests to
purchase Janus Tax-Exempt Money Market Fund must be received before 12:00 p.m.
(New York time) on a business day in order to receive the dividend declared on
the day of purchase. In addition, the Funds' transfer agent must receive payment
in federal funds by 4:00 p.m. (New York time). The Funds reserve the right to
require purchase requests and payments prior to these times on days when the
bond market closes before 4:00 p.m. (New York time). Purchase orders received
after these times will receive the dividend declared the following day.

WIRE INSTRUCTIONS:

Request your bank to transmit immediately available funds by wire for purchase
of Shares to the Funds' custodian bank as follows:

United Missouri Bank, N.A., Kansas City, Missouri
ABA # 101000695
BNF = Janus Money Market Funds Account # 9870610000
For credit to: Name of Shareholder:
Shareholder Account No.:
Name of Fund(s):

Complete information regarding your account must be included in all wire
instructions in order to facilitate prompt and accurate handling of investments.
Please contact the Janus Extended Services Team at 1-800-29JANUS when you intend
to make a wire purchase.

The Funds do not charge any fees for transactions by wire in Shares of the
Funds.

Once you have established a Fund account, you may purchase Shares for such
account or open additional accounts with other Funds at any time. The Funds
reserve the right to suspend the offering of Shares for a period of time and to
reject any specific purchase request. If you have any questions, please call
1-800-29JANUS.

MINIMUM INVESTMENT

The minimum initial investment in the Shares is $250,000. The Funds may, in
their discretion, waive this minimum under certain circumstances but, in such
event, the minimum must be reached within 90 days of opening the account.
Shareholders who do not maintain the $250,000 minimum will be given the option
of exchanging into Investor Shares or having their Shares redeemed.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
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NET ASSET VALUE

The net asset value ("NAV") of the Shares is determined at the close of the
regular trading session of the New York Stock Exchange (normally 4:00 p.m., New
York time) each day that both the Exchange and the New York Federal Reserve Bank
are open. NAV per share is determined by dividing the total value of the
securities and other assets, less liabilities, by the total number of Shares
outstanding. Portfolio securities are valued at their amortized cost. Amortized
cost valuation involves valuing an instrument at its cost and thereafter
assuming a constant amortization to maturity (or such other date as permitted by
Rule 2a-7) of any discount or premium. If fluctuating interest rates cause the
market value of a portfolio to deviate more than 1/2 of 1% from the value
determined on the basis of amortized cost, the Trustees will consider whether
any action, such as adjusting the Share's NAV to reflect current market
conditions, should be initiated to prevent any material dilutive effect on
shareholders.

SHARE CERTIFICATES

HOW TO EXCHANGE SHARES

The Janus funds include several funds with a variety of investment objectives.
You may exchange your Shares for shares of any other Janus fund that is
available to the public and registered in your state of residence. There are
certain procedures which should be followed to effect the transfer of the entire
or partial balance in your Shares to one of the other Janus funds. The Funds
reserve the right to reject any exchange request and to modify or terminate the
exchange privilege at any time. For example, the Funds may reject exchanges from
accounts engaged in excessive trading (including market timing transactions)
that are detrimental to the Funds. If you would like more information regarding
this option, please call the Janus Extended Services Team at 1-800-29JANUS.

HOW TO REDEEM SHARES

PARTIAL OR COMPLETE REDEMPTIONS

You may redeem all or a portion of your Shares on any business day. Your Shares
will be redeemed at the NAV next calculated after your Fund has received your
redemption request in good order and meeting all the requirements of this
Prospectus. Proceeds of such redemption generally will be wired to your
predesignated bank account as of the day of redemption, or, if that day is a
bank holiday, on the next bank business day.

IN WRITING

To redeem all or part of your Shares in writing, send a letter of instruction to
the following address:

The letter should be on company letterhead (in the case of institutional
clients) and should specify the name of the Fund, the number of Shares or
dollars being redeemed, the account number, appropriate wiring instructions, the
name(s) on the account, your name and your daytime telephone number. The letter
must be signed by an authorized person whose signature is on file with the Fund.

For IRA shareholders, written instructions must be signed by the account owner.
If you do not want federal income tax withheld from your redemption, you must
state that you elect not to have such withholding apply. In addition, your
instructions must state whether the distribution is normal (after age 591/2) or
premature (before age 591/2) and, if premature, whether any exceptions such as
death or disability apply with regard to the 10% additional tax on early
distributions.

BY TELEPHONE

Shares may be redeemed by telephone. If a request for a redemption is received
by 3:00 p.m. (New York time) for Janus Money Market Fund and Janus Government
Money Market Fund and by 12:00 p.m. (New York time) for Janus Tax-Exempt Money
Market Fund, Shares will be redeemed and the redemption amount wired in federal
funds to the shareholder's predesignated bank account that day. After 3:00 p.m.
(12:00 p.m. for Janus Tax-Exempt Money Market Fund), a redemption request will
be processed at that day's NAV and will include that day's dividends, but
generally will not be wired until the next bank business day. The Funds reserve
the right to require redemption requests prior to these times on days when the
bond market closes before 4:00 p.m. (New York time). There is no fee for
redemptions by wire.

BY A FUND

Your account may be terminated by your Fund if, due to the transfer or
redemption of Shares, the value of the remaining Shares in your account falls
below the minimum investment required to open a new account, or if you engage in
illegal or other conduct detrimental to the Funds. In the case of insufficient
account size, your Fund will notify you that you have 60 days to increase your
account to the minimum required before redeeming your account.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
11
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SPECIAL SHAREHOLDER SERVICES AND OTHER INFORMATION

PORTFOLIO INFORMATION

You may call 1-800-29JANUS by TouchTone(TM) telephone for access to certain
information regarding your account, including current yield and dividend rate
information, Monday through Friday from 7:00 a.m. to 10:00 p.m. (New York time).

TELEPHONE INSTRUCTIONS

ACCOUNT ADDRESS AND NAME CHANGES

To change the address on your account, you may call 1-800-29JANUS or send a
written request signed by all registered owners of your account. Please include
the name of the Fund(s), the account number(s), the name(s) on the account and
both the old and new addresses. Within the first 10 days of an address change,
redemptions by institutional clients are permissible only if the redemption
proceeds are wired to a pre-designated bank account or you provide the Funds
with appropriate corporate resolutions changing wire instructions. Please call
1-800-29JANUS for additional information.

To change the name on an account, the Shares must be transferred to a new
account. Such a change generally requires written instructions with the
guaranteed signatures of all registered owners, as well as an Application and
supporting legal documentation, if applicable. Please call 1-800-29JANUS for
additional information.

STATEMENTS AND REPORTS

Each shareholder will receive daily confirmations of purchases and redemptions
made in the Funds. On the last day of each month, the shareholder will receive a
statement reporting all purchases and redemptions made during that month, and
dividends paid during the month.

Twice each year you will receive the financial statements of the Funds,
including a statement listing portfolio securities. To reduce expenses, only one
copy of most reports (such as the Funds' Annual Report) may be mailed to all
accounts with the same tax identification number. Please call 1-800-29JANUS if
you need additional reports sent each time.

TEMPORARY SUSPENSION OF SERVICES

The Funds or their agents may temporarily suspend telephone transactions and
other shareholder services described in this Prospectus upon reasonable notice
or to the extent that any circumstance reasonably beyond the control of the
Funds or their agents materially hampers the provision of such services.

JANUS INSTITUTIONAL MONEY MARKET FUNDS PROSPECTUS FEBRUARY 18, 1996
12