JANUS INVESTMENT FUND, 497, 1998-02-19

JANUS INVESTMENT FUND
497, 1998-02-19

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JANUS FUND
PROSPECTUS

[JANUS LOGO]

<PAGE>

JANUS FUND

100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com

FEBRUARY 17, 1998

Janus Fund (the "Fund") is a no-load, diversified mutual fund that seeks
long-term growth of capital by investing primarily in common stocks of issuers
of any size. Generally, the Fund emphasizes issuers with larger market
capitalizations.

For complete information on how to purchase, exchange and sell shares, please
see the Shareholder's Manual beginning on page 14.

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 17, 1998, 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. The SEC maintains a
Web site located at http://www.sec.gov that contains the SAI, material
incorporated by reference, and other information regarding the Fund.

THE FUND'S SHARES ARE NOT BANK DEPOSITS OR OBLIGATIONS OF ANY BANK, ARE NOT
ENDORSED OR GUARANTEED BY ANY BANK, AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENT
AGENCY.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC NOR HAS THE SEC 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 FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

CONTENTS

<TABLE>
<S> <C>
THE FUND AT A GLANCE
Brief description of the Fund................ 2
EXPENSE INFORMATION
The Fund's annual operating expenses......... 3
Financial Highlights - a summary of financial
data....................................... 4
THE FUND IN DETAIL
Investment Objective and Policies............ 7
General Portfolio Policies................... 9
Additional Risk Factors...................... 10
PERFORMANCE TERMS
An Explanation of Performance Terms.......... 13
SHAREHOLDER'S MANUAL
Minimum Investments.......................... 14
Types of Account Ownership................... 14
How to Open Your Janus Account............... 16
How to Purchase Shares....................... 16
How to Exchange Shares....................... 18
How to Redeem Shares......................... 19
Shareholder Services and Account Policies.... 21
MANAGEMENT OF THE FUND
Investment Adviser and Investment
Personnel................................. 24
Personal Investing........................... 25
Management Expenses.......................... 25
Portfolio Transactions....................... 25
Other Service Providers...................... 26
Other Information............................ 26
DISTRIBUTIONS AND TAXES
Distributions................................ 28
Taxes........................................ 29
APPENDIX A
Glossary of Investment Terms................. 30
</TABLE>

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 1
<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:
The investment objective of the Fund is long-term growth of capital in a manner
consistent with the preservation of capital.

PRIMARY HOLDINGS:
A diversified fund that pursues its objective by investing primarily in common
stocks of issuers of any size. The Fund generally invests in larger, more
established issuers.

SHAREHOLDER'S INVESTMENT HORIZON:
The Fund is designed for long-term investors who seek growth of capital and who
can tolerate the greater risks associated with investments in 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 27
years and currently manages approximately $70 billion in assets.

FUND MANAGER:
James P. Craig, III

ASSISTANT FUND MANAGERS:
David Decker
Blaine Rollins

FUND INCEPTION:
February 1970

2 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

EXPENSE INFORMATION

The following tables and example 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 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

<TABLE>
<S> <C>
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
</TABLE>

* There is an $8 service fee for redemptions by wire.

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

<TABLE>
<S> <C>
- ------------------------------------------------------------
Management Fee 0.65%
Other Expenses 0.22%
- ------------------------------------------------------------
Total Operating Expenses 0.87%
- ------------------------------------------------------------
</TABLE>

(1)The Management Fee reflects a reduced fee schedule effective July 1, 1997,
applied to net assets as of October 31, 1997. Other Expenses are based on
expenses before expense offset arrangements for the fiscal year ended October
31, 1997.

EXAMPLE

<TABLE>
<CAPTION>
- --------------------------------------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- --------------------------------------------------------------------
<S> <C> <C> <C> <C>
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 $28 $48 $107
</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 FUND PROSPECTUS FEBRUARY 17, 1998 3
<PAGE>

FINANCIAL HIGHLIGHTS

The information below is for fiscal periods ending on October 31st of each year.
The accounting firm of Price Waterhouse LLP has audited the Fund's financial
statements beginning with the year ended October 31, 1990. Their report is
included in the Fund's Annual Report, which is incorporated by reference into
the SAI.
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
- -----------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $26.65 $23.37 $19.62 $20.81 $18.86
- -----------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.15 0.31 0.16 0.17 0.26
3. Net gains or (losses) on securities
(both realized and unrealized) 5.69 4.23 3.99 (0.03) 2.88
- -----------------------------------------------------------------------------------------------
4. Total from investment operations 5.84 4.54 4.15 0.14 3.14
- -----------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.21) (0.13) (0.01) (0.39) (0.29)
6. Distributions (from capital gains) (2.92) (1.13) (0.39) (0.94) (0.90)
- -----------------------------------------------------------------------------------------------
7. Total distributions (3.13) (1.26) (0.40) (1.33) (1.19)
- -----------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $29.36 $26.65 $23.37 $19.62 $20.81
- -----------------------------------------------------------------------------------------------
9. Total return 24.18% 20.31% 21.62% 0.75% 17.41%
- -----------------------------------------------------------------------------------------------
10. Net assets, end of period (in
millions) $19,029 $15,313 $11,963 $9,647 $9,098
11. Average net assets for the period (in
millions) $17,515 $13,753 $10,560 $9,339 $7,336
12. Ratio of gross expenses to average net
assets 0.87% 0.86% 0.87% N/A N/A
13. Ratio of net expenses to average net
assets 0.86% 0.85% 0.86% 0.91% 0.92%
14. Ratio of net investment income to
average net assets 0.85% 0.91% 1.25% 1.12% 1.55%
15. Portfolio turnover rate 132% 104% 118% 139% 127%
16. Average commission rate $.0500 $.0558 N/A N/A N/A
- -----------------------------------------------------------------------------------------------

<CAPTION>
1992
<S> <C>
- ---------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $18.27
- ---------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.23
3. Net gains or (losses) on securities
(both realized and unrealized) 1.46
- ---------------------------------------------------
4. Total from investment operations 1.69
- ---------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.19)
6. Distributions (from capital gains) (0.91)
- ---------------------------------------------------
7. Total distributions (1.10)
- ---------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $18.86
- ---------------------------------------------------
9. Total return 9.35%
- ---------------------------------------------------
10. Net assets, end of period (in
millions) $4,989
11. Average net assets for the period (in
millions) $3,871
12. Ratio of gross expenses to average net
assets N/A
13. Ratio of net expenses to average net
assets 0.97%
14. Ratio of net investment income to
average net assets 1.54%
15. Portfolio turnover rate 153%
16. Average commission rate N/A
- ---------------------------------------------------
</TABLE>

4 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>
<TABLE>
<CAPTION>
(CONTINUED) 1991 1990 1989 1988
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $13.25 $16.36 $12.11 $12.39
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.25 0.25 0.22 0.60
3. Net gains or (losses) on securities (both realized
and unrealized) 5.09 (0.67) 4.59 1.05
- ---------------------------------------------------------------------------------------------------
4. Total from investment operations 5.34 (0.42) 4.81 1.65
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.31) (0.19) (0.56) (0.32)
6. Distributions (from capital gains) (0.01) (2.50) -- (1.61)
- ---------------------------------------------------------------------------------------------------
7. Total distributions (0.32) (2.69) (0.56) (1.93)
- ---------------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $18.27 $13.25 $16.36 $12.11
- ---------------------------------------------------------------------------------------------------
9. Total return 40.95% (3.68%) 41.67% 15.83%
- ---------------------------------------------------------------------------------------------------
10. Net assets, end of period (in millions) $2,598 $1,049 $673 $391
11. Average net assets for the period (in millions) $1,785 $930 $487 $382
12. Ratio of gross expenses to average net assets N/A N/A N/A N/A
13. Ratio of net expenses to average net assets 0.98% 1.02% 0.92% 0.98%
14. Ratio of net investment income to average net assets 1.77% 2.11% 1.68% 4.99%
15. Portfolio turnover rate 132% 307% 205% 175%
16. Average commission rate N/A N/A N/A N/A
- ---------------------------------------------------------------------------------------------------
</TABLE>

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 5
<PAGE>

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 a Fund share 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) are the per share amount that the Fund paid from net
investment income.

NET GAINS (OR LOSSES) 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) are 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. Total return 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.

RATIO OF GROSS EXPENSES TO AVERAGE NET ASSETS is the total of the Fund's
operating expenses before expense offset arrangements divided by its average net
assets for the stated period. The Fund was not required to disclose the ratio of
gross expenses to average net assets prior to 1995. RATIO OF NET EXPENSES TO
AVERAGE NET ASSETS reflects reductions in the Fund's expenses through the use of
brokerage commissions and uninvested cash balances earning interest or balance
credits.

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS is the Fund's total 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.

AVERAGE COMMISSION RATE is the total of the Fund's agency commissions paid on
equity securities trades divided by the number of shares purchased and sold.

6 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

THE FUND IN DETAIL

This section takes a closer look at the Fund's investment objective, policies
and the securities in which it invests. 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 material
changes.

You should carefully consider your own investment goals, time horizon (the
amount of time you plan to hold your shares of the Fund) and risk tolerance
before investing in the Fund. 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. There is no guarantee that the Fund will meet
its investment objective.

You should also 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.

INVESTMENT OBJECTIVE
The investment objective of the 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 primarily in common stocks of issuers of any
size. The Fund generally invests in larger, more established issuers.

TYPES OF INVESTMENTS
The Fund invests primarily in common stocks selected for their growth potential.
The 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 opportunity for capital growth from such
securities or to receive a return on idle cash. The Fund may invest up to 25% of
its assets in mortgage- and asset-backed securities, up to 10% of its assets in
zero coupon, pay-in-kind and step coupon securities, and without limit in
indexed/structured securities. The Fund will invest less than 35% of its assets
in high-yield/high-risk securities. The Fund may also purchase 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 manager believes that market conditions are not
favorable for profitable investing or when the portfolio manager is 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 manager has committed available assets to
desirable investment opportunities. When the Fund is hedged or its investments
in cash or similar investments increase, it may not participate

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 7
<PAGE>

in market advances or declines to the extent that it would if the Fund was not
hedged or remained more fully invested in common stocks.

The Fund may invest without limit in foreign equity and debt securities. The
Fund 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. The Fund may use options, futures and other types of derivatives for
hedging purposes or for non-hedging purposes such as seeking to enhance return.
See "Additional Risk Factors" on page 10. The Fund may purchase securities on a
when-issued, delayed delivery or forward commitment basis.

The Fund may invest in "special situations" from time to time. A special
situation arises when, in the opinion of the 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. See "Additional Risk
Factors" on page 10.

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

Q: HOW ARE COMMON STOCKS SELECTED?

A: The Fund 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. The portfolio manager
generally takes a "bottom up" approach to building the portfolio. In other
words, the manager seeks 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.

Q: ARE THE SAME CRITERIA USED
TO SELECT FOREIGN SECURITIES?

A: Generally, yes. The portfolio manager seeks companies that meet his
selection criteria, 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 10.

Q: WHAT IS THE MAIN RISK OF INVESTING
IN A GROWTH FUND?

A: Since the Fund usually invests heavily in common stocks, the fundamental
risk is that the value of the stocks the Fund holds might decrease. Stock
values may fluctuate in response to the activities of an individual company
or in response to general

8 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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.

Q: HOW DOES THE FUND
TRY TO REDUCE RISK?

A: Diversification of the Fund's assets reduces the effect of any single
holding on its overall portfolio value. The Fund may use futures, options
and other derivative instruments to protect the portfolio from movements in
securities prices and interest rates. The Fund may also use a variety of
currency hedging techniques, including forward currency contracts, to manage
exchange rate risk. See "Additional Risk Factors" on page 10.

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 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:

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

- - 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.

- - The Fund will invest no more than 25% of its total assets in a single issuer
(other than U.S. government securities).

INDUSTRY CONCENTRATION
As a fundamental policy, the Fund will not invest 25% or more of its total
assets in any particular industry (excluding 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

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 9
<PAGE>

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, 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.

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. If illiquid securities exceed 15% of a Fund's net
assets after the time of purchase, the Fund will take steps to reduce in an
orderly fashion its holdings of illiquid securities. 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 will follow guidelines
established by the Trustees of the Trust ("Trustees") in making liquidity
determinations for Rule 144A securities and other securities, including
privately placed commercial paper.

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

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

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

- - 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.

Under the terms of an exemptive order received from the SEC, the Fund may 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 percentage limits.

ADDITIONAL RISK FACTORS
SPECIAL SITUATIONS
Special situations may include, among others, significant changes in a company's
allocation of its existing capital, a restructuring of assets, 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, may
involve greater risks than investing in comparable domestic securities.
Securities of some foreign

10 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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:

- - 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 denominated 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.

- - 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 the Fund's assets from
that country. The Fund may invest in emerging market countries. Emerging
market countries involve greater risks such as immature economic structures,
national policies restricting investments by foreigners, and different legal
systems.

- - 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.

- - 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.

- - 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.

Foreign securities purchased indirectly (e.g., depositary receipts) are subject
to many of the above risks, including currency risk, because their values depend
on the performance of a foreign security denominated in its home currency.

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

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 11
<PAGE>

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

- - the risk that interest rates, securities prices and currency markets will not
move in the directions that the portfolio manager anticipates;

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

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

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

- - 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;

- - 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

- - 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 such as Standard & Poor's
Ratings Services ("Standard & Poor's") and Moody's Investors Service, Inc.
("Moody's").

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.

12 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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. The market for lower quality securities is generally less liquid
than the market for higher quality securities. 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.

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

SHORT SALES
The Fund may engage in "short sales against the box." This technique involves
selling either a security that the Fund owns, or a security equivalent in kind
and amount to the security sold short that the Fund has the right to obtain, for
delivery at a specified date in the future. The Fund may enter into a short sale
against the box to hedge against anticipated declines in the market price of
portfolio securities. If the value of the securities sold short increases prior
to the scheduled delivery date, the Fund loses the opportunity to participate in
the gain.

See Appendix A for risks associated with certain other investments.

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 YOUR SHARES, WHEN REDEEMED, MAY BE WORTH MORE OR
LESS THAN THEIR ORIGINAL COST.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 13
<PAGE>

SHAREHOLDER'S MANUAL

This section will help you become familiar with the different types of accounts
you can establish with Janus. It also explains in detail the wide array of
services and features you can establish on your account, as well as account
policies and fees that may apply to your account. Account policies (including
fees), services and features may be modified or discontinued without shareholder
approval or prior notice.

MINIMUM INVESTMENTS*

<TABLE>
<S> <C>
To open a new account.............................. $2,500
To open a new retirement, education 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+
</TABLE>

* 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.
** An Automatic Investment Program requires a $100 minimum automatic
investment per month until the account balance reaches $2,500.
+ The minimum subsequent investment for IRA or UGMA/UTMA accounts is
$50.

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.-8:00
p.m., and Saturday: 10:00 a.m.-4:00 p.m., New York time. The Quick Address and
Telephone Reference below includes other ways to get in touch with Janus.

QUICK ADDRESS AND TELEPHONE REFERENCE

<TABLE>
<S> <C>
MAILING ADDRESS JANUS XPRESS LINE 1-888-979-7737
Janus For 24-hour access to account and
P.O. Box 173375 fund information, exchanges and
Denver, CO 80217-3375 purchases, automated daily quotes on
fund share prices, yields and total
FOR OVERNIGHT CARRIER returns.
Janus TDD 1-800-525-0056
Suite 101 A telecommunications device for our
3773 Cherry Creek North Drive hearing- and speech-impaired
Denver, CO 80209-3811 shareholders.
JANUS INTERNET ADDRESS JANUS LITERATURE LINE 1-800-525-8983
http://www.Janus.com To request a prospectus, shareholder
reports or marketing materials.
</TABLE>

TYPES OF ACCOUNT OWNERSHIP
If you are investing for the first time, you will need to establish an account.
You can establish the following types of accounts by completing a New Account
Application. To request an application, call 1-800-525-3713.

14 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one person.
Joint accounts have two or more owners.

- - 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.

- - 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.

- - 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.

TAX-DEFERRED ACCOUNTS
If you are eligible, you may set up one or more tax-deferred accounts. A
tax-deferred account allows you to shelter your investment income and capital
gains from current income taxes. A contribution to certain of these plans may
also be tax deductible. Tax deferred accounts include retirement plans and the
Education IRA. Distributions from these plans are generally subject to income
tax and may be subject to an additional tax if withdrawn prior to age 59 1/2 or
used for a nonqualifying purpose. Investors should consult their tax advisor or
legal counsel before selecting a tax-deferred account.

Investors Fiduciary Trust Company serves as custodian for the tax-deferred
accounts offered by the Fund. You will be charged an annual account maintenance
fee of $12 for each Fund account, up to a maximum of $24 for two or more Fund
accounts registered under the same taxpayer identification number. Each Janus
fund you own under your IRA account number is considered a separate "Fund
account." You may pay the fee by check or have it automatically deducted from
your account (usually in December). The Fund reserves the right to change the
amount of this fee or to waive it in whole or in part for certain types of
accounts.

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

- - REGULAR AND ROTH INDIVIDUAL RETIREMENT ACCOUNTS ("IRAS"): Both types of IRAs
allow most individuals with earned income to contribute up to the lesser of
$2,000 ($4,000 for most married couples) or 100% of compensation annually.
Please refer to the Janus IRA booklet for more complete information regarding
the different types of IRAs.

- - EDUCATION IRA: This plan allows individuals, subject to certain income
limitations, to contribute up to $500 annually on behalf of any child under
the age of 18. Please refer to the Janus IRA booklet for more complete
information regarding the Education IRA.

- - 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.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 15
<PAGE>

- - PROFIT SHARING OR MONEY PURCHASE PENSION PLAN: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees and
themselves.

- - 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.

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 and make
your check payable to Janus. The Fund is only available to U.S. citizens or
residents, and your application will be returned if you do not meet these
criteria. Send all items to one of the following addresses:

For Overnight Carrier
- --------------------

Janus
Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811

For All Other Inquiries:
- ----------------------

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

INVESTOR SERVICE CENTERS
Janus 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 Monday-Friday 7:00 a.m. to 6:00
p.m. Mountain time and Saturday 9:00 a.m. to 1:00 p.m. Mountain time:

100 Fillmore Street, Suite 100
Denver, CO 80206

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

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:

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

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

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

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

16 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - 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.

- - 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 ($50 FOR IRAS OR UGMA/UTMA ACCOUNTS). 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. To purchase shares by telephone, call
an Investor Service Representative at 1-800-525-3713 during normal business
hours or call the Janus Xpress Line, 1-888-979-7737, for access to this option
24 hours a day. 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 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 programs to help investors achieve
their financial goals as simply and conveniently as possible. You may open a new
account with a $500 initial purchase and $100 automatic subsequent investments.

- - 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 FUND PROSPECTUS FEBRUARY 17, 1998 17
<PAGE>

- - PAYROLL DEDUCTION
If your employer can initiate an automatic payroll deduction, you may have all
or a portion of your paycheck ($100 minimum) invested directly into your Fund
account. To obtain information on establishing this option, call
1-800-525-3713.

- - 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 20.

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 Xpress Line,
1-888-979-7737, for access to this option 24 hours a day.

BY SYSTEMATIC EXCHANGE
As noted above, you may establish a Systematic Exchange for as little as $100
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
- - Except for Systematic Exchanges, new accounts established by exchange must be
opened with $2,500 or the total account value if the value of the account you
are exchanging from is less than $2,500.

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

- - You may make four exchanges out of the Fund during a calendar year (exclusive
of Systematic Exchanges). Exchanges in excess of this limit may be subject to
an exchange fee or may result in termination of the exchange privilege.

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

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

18 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

- - Be sure that you read the prospectus for the fund into which you are
exchanging.

- - 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.

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 noted on page 20.

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 request redemptions daily from your account by calling 1-800-525-3713 by the
close of the regular trading session of the New York Stock Exchange ("NYSE"),
normally 4:00 p.m. New York time. You may also use Janus Xpress Line,
1-888-979-7737, for access to this option 24 hours a day. Redemption requests
received through Janus Xpress Line will be processed at the NAV next calculated
after receipt and acceptance of the request. (There is a daily limit of $100,000
per account for redemptions payable by check.)

SYSTEMATIC REDEMPTION OPTION
The Systematic Redemption Option allows you to redeem a specific dollar amount
from your account on a regular basis. For more information or to request the
appropriate form, please call 1-800-525-3713.

PAYMENT OF REDEMPTION PROCEEDS
- - 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.

- - BY ELECTRONIC TRANSFER
If you have established the electronic redemption option, your redemption
proceeds can be electronically transferred to your predesignated bank account
on the next bank business day after receipt of your redemption request (wire
transfer) or the second bank business day after receipt of your redemption
request (ACH transfer). Wire transfers will be charged an $8 fee per wire and
your bank may charge an additional fee to receive the wire. ACH transfers are
made free of charge. Wire redemptions are not available for retirement
accounts.

If you would like to establish the electronic redemption option on an existing
account, please call 1-800-525-3713 to request the appropriate form.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 19
<PAGE>

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 or exchange all or part of your shares in writing, your request should
be sent to one of the addresses listed on page 16 and must include the following
information:

- - the name of the Fund,

- - the account number,

- - the amount of money or number of shares being redeemed,

- - the name(s) on the account,

- - the signature(s) of all registered account owners, and

- - your daytime telephone number.

SIGNATURE REQUIREMENTS BASED ON ACCOUNT TYPE
- - INDIVIDUAL, JOINT TENANTS, TENANTS IN COMMON: Written instructions must be
signed by each shareholder, exactly as the names appear in the account
registration.

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

- - SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

- - 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.

- - 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.

- - 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 59 1/2) or premature
(before age 59 1/2) and, if premature, whether any exceptions such as death or
disability apply with regard to the 10% additional tax on early distributions.

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

20 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - You request a redemption that exceeds $100,000.

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

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

- - 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.

PRICING OF FUND SHARES
All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved by the Fund (or its
designated agent). The Fund's NAV is calculated at the close of the regular
trading session of 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 of the NYSE. The Fund's portfolio
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.

SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JANUS XPRESS LINE(TM)
Janus Xpress Line, our electronic telephone service, offers you 24-hour access
by TouchTone(TM) telephone to obtain information on your account balances, Fund
performance or dividends. You can also make exchanges, purchases, redemptions
and electronic transfers in existing accounts, request literature about any
Janus fund, or to order duplicate statements. Janus Xpress Line is accessed by
calling 1-888-979-7737. Calls are limited to five minutes.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 21
<PAGE>

JANUS WEB SITE
Janus maintains a Web site located at http://www.Janus.com. You can access
information such as your account balance and the Fund's NAV through the Web
site. In addition, you may request and/or download a prospectus for any Janus
fund.

ACCOUNT MINIMUMS
Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 minimum balance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
on page 14 or 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, for purposes of this policy, accounts
will be valued in September, and the $10 fee will be 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.

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 employee benefit 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. Processing Organizations may also impose other
charges or restrictions different from those applicable to shareholders who
invest in the Fund directly. A 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 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 number, 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

22 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 believed to be 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 an Investor Service Representative 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 purchases, exchanges,
redemptions and electronic transfers, calling the Janus Xpress Line.

TEMPORARY SUSPENSION OF SERVICES
The Fund or its 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 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
Investors participating in an automatic investment program will receive
quarterly confirmations of all transactions. In addition, the Fund will send you
an immediate transaction confirmation statement after every non-systematic
transaction. The Fund distributes dividend information annually.

Financial reports for the Fund, which include a list of the Fund's portfolio
holdings, will be mailed semiannually to all shareholders. You will receive an
updated prospectus annually. To reduce expenses, only one copy of most financial
reports and prospectuses will be mailed to your household, even if more than one
person in the household has a Fund account. Please call 1-800-525-3713 if you
would like to receive additional reports or prospectuses.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 23
<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 80206-4928, 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 began serving as investment adviser to the Fund 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 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

PORTFOLIO MANAGER
JAMES P. CRAIG, III is Chief Investment Officer of Janus Capital. He is
Executive Vice President and portfolio manager of the Fund, which he has managed
since 1986 and Executive Vice President and a co-manager of Janus Venture Fund,
which he has managed since February 1997. Mr. Craig previously managed Janus
Venture Fund from its inception to December 1993 and Janus Balanced Fund from
December 1993 to 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.

ASSISTANT PORTFOLIO MANAGERS
DAVID DECKER is an assistant portfolio manager of the Fund. He is Executive Vice
President and portfolio manager of Janus Special Situations Fund, which he has
managed

24 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

since inception. He joined Janus in 1992 as a research analyst and focused on
companies in the automotive and defense industries prior to managing Janus
Special Situations Fund. He obtained his Master of Business Administration in
Finance from the Fuqua School of Business at Duke University and a Bachelor of
Arts in Economics and Political Science from Tufts University. He is a Chartered
Financial Analyst.

BLAINE ROLLINS is an assistant portfolio manager of the Fund. He is Executive
Vice President and portfolio manager of Janus Balanced Fund, which he has
managed since January 1996 and Janus Equity Income Fund which he has managed
since inception. Mr. Rollins joined Janus Capital in 1990 and gained experience
as a fixed-income trader and equity research analyst prior to managing Balanced
Fund. He holds a Bachelor of Science in Finance from the University of Colorado
and is a Chartered Financial Analyst.

PERSONAL INVESTING
Janus Capital does not permit portfolio managers to purchase and sell securities
for their own accounts, except under the limited exceptions contained in 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.

MANAGEMENT EXPENSES
The Fund pays Janus Capital a management fee which is calculated 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.

<TABLE>
<CAPTION>
AVERAGE DAILY NET ASSETS OF FUND ANNUAL RATE PERCENTAGE (%)
<S> <C>
----------------------------------------------------------------------
First $300 Million 0.75
Next $200 Million 0.70
Over $500 Million 0.65
----------------------------------------------------------------------
</TABLE>

The management fee schedule above was effective July 1, 1997. The actual
management fee paid by the Fund for the fiscal year ended October 31, 1997, was
0.65% of the value of the Fund's average daily net assets. As asset size
increases, the annual rate of the management fee declines in accordance with the
above schedule. In addition, 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 FUND PROSPECTUS FEBRUARY 17, 1998 25
<PAGE>

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 to
execute transactions. 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 serving to reduce those expenses. The SAI further
explains the selection of broker-dealers.

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

CUSTODIAN
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351

TRANSFER AGENT
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375

DISTRIBUTOR
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206-4928

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital.

As of the date of this Prospectus, the Trust offers 19 separate series, three of
which currently offer three classes of shares. The Trust currently offers the
other 18 series by separate 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 the 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.

26 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

SIZE OF THE FUND
The Fund has no present plans to limit its size. However, the 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 the Fund are discontinued, it is expected that existing shareholders of
the 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 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. Unless otherwise required by law,
this policy may be implemented by the Trustees without shareholder approval.

YEAR 2000
Preparing for Year 2000 is a high priority for Janus Capital, which has
established a dedicated group to address this issue. Janus Capital has entered
into a consulting arrangement with one of the foremost experts in Year 2000
compliance to help Janus Capital successfully achieve Year 2000 compliance.
Janus Capital does not anticipate that the move to Year 2000 will have a
material impact on its ability to continue to provide the Fund with service at
current levels.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 27
<PAGE>

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS

TO AVOID TAXATION, THE INTERNAL REVENUE CODE REQUIRES THE FUND TO DISTRIBUTE NET
INCOME AND ANY NET CAPITAL GAINS REALIZED BY ON ITS INVESTMENTS ANNUALLY. THE
FUND'S INCOME FROM DIVIDENDS AND INTEREST AND ANY NET REALIZED SHORT-TERM
CAPITAL GAINS ARE PAID TO SHAREHOLDERS AS ORDINARY INCOME 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 A 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. Shareholders should be aware that
distributions from a taxable mutual fund are not value-enhancing and may create
income tax obligations.

"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
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 the Fund at one of the addresses on page 16 or calling
1-800-525-3713. The Fund offers 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.

28 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 into your account 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 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. Account tax information will also be sent to the IRS.

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. The Fund
may from year to year make the election permitted under Section 853 of the
Internal Revenue Code to pass through such taxes to shareholders as a foreign
tax credit. If such an election is not made, any foreign taxes paid or accrued
will represent an expense to the Fund which will reduce its investment income.

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 FUND PROSPECTUS FEBRUARY 17, 1998 29
<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
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 of the bond) at a specified maturity and to make
scheduled interest payments.

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
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 (e.g., 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

30 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 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.

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. To avoid taxes and interest that the Fund must
pay if these investments are profitable, the Fund may make various elections
permitted by the tax laws. These elections could require that the Fund recognize
taxable income, which in turn must be distributed, before the securities are
sold and before cash is received to pay the distributions.

PAY-IN-KIND BONDS are debt securities that normally give the issuer an option to
pay cash at a coupon payment date or give the holder of the security a similar
bond with the same coupon rate and a face value equal to the amount of the
coupon payment that would have been made.

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 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 primarily 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.

STEP COUPON BONDS are debt securities that trade at a discount from their face
value and pay coupon interest. The discount from the face value depends on the
time remaining until cash payments begin, prevailing interest rates, liquidity
of the security and the perceived credit quality of the issuer.

JANUS FUND PROSPECTUS FEBRUARY 17, 1998 31
<PAGE>

STRIP BONDS 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.

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 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 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. 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 a
financial instrument 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 securities denominated in, or whose value is
tied to, a currency other than the U.S. dollar or to reduce the impact of
currency appreciation on purchases of such securities. It may also enter into
forward contracts to purchase or sell securities or other financial indices.

32 JANUS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 instruments and may be more
volatile than the underlying instruments. The 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).

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 FUND PROSPECTUS FEBRUARY 17, 1998 33

<PAGE>
[JANUS LOGO]

P.O. Box 173375 o Denver, CO 80217-3375 o 1-800-525-3713
Janus Distributors, Inc. Member NASD. (2/98)

<PAGE>
JANUS MERCURY FUND
PROSPECTUS

[JANUS LOGO]

<PAGE>

JANUS MERCURY FUND

100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com

FEBRUARY 17, 1998

Janus Mercury Fund (the "Fund") is a no-load, diversified mutual fund that seeks
long-term growth of capital. The Fund 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.

For complete information on how to purchase, exchange and sell shares, please
see the Shareholder's Manual beginning on page 14.

THE FUND'S SHARES ARE NOT BANK DEPOSITS, ARE NOT ENDORSED OR GUARANTEED BY ANY
BANK, AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE
FEDERAL RESERVE BOARD, OR ANY OTHER GOVERNMENT AGENCY.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC NOR HAS THE SEC 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 MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

CONTENTS

<TABLE>
<S> <C>
THE FUND AT A GLANCE
Brief description of the Fund................ 2
EXPENSE INFORMATION
The Fund's annual operating expenses......... 3
Financial Highlights -- a summary of
financial data............................. 4
THE FUND IN DETAIL
Investment Objective and Policies............ 6
General Portfolio Policies................... 8
Additional Risk Factors...................... 9
PERFORMANCE TERMS
An Explanation of Performance Terms.......... 13
SHAREHOLDER'S MANUAL
Minimum Investments.......................... 14
Types of Account Ownership................... 14
How to Open Your Janus Account............... 16
How to Purchase Shares....................... 16
How to Exchange Shares....................... 18
How to Redeem Shares......................... 19
Shareholder Services and Account Policies.... 21
MANAGEMENT OF THE FUND
Investment Adviser and Portfolio Manager..... 24
Personal Investing........................... 24
Management Expenses.......................... 25
Portfolio Transactions....................... 25
Other Service Providers...................... 25
Other Information............................ 26
DISTRIBUTIONS AND TAXES
Distributions................................ 28
Taxes........................................ 29
APPENDIX A
Glossary of Investment Terms................. 30
</TABLE>

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 1
<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:
The investment objective of the Fund is long-term growth of capital.

PRIMARY HOLDINGS:
A diversified fund that pursues its investment objective by investing primarily
in common stocks of companies of any size.

FUND MANAGER:
Warren B. Lammert

FUND INCEPTION:
May 1993

2 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

EXPENSE INFORMATION

SHAREHOLDER TRANSACTION EXPENSES

* There is an $8 service fee for redemptions by wire.

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

<TABLE>
<S> <C>
- ------------------------------------------------------------
Management Fee 0.67%
Other Expenses 0.31%
- ------------------------------------------------------------
Total Operating Expenses 0.98%
- ------------------------------------------------------------
</TABLE>

EXAMPLE

<TABLE>
<CAPTION>
- -------------------------------------------------------------------------
1 YEAR 3 YEARS 5 YEARS 10 YEARS
- -------------------------------------------------------------------------
<S> <C> <C> <C> <C>
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. $10 $31 $54 $120
</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 MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 3
<PAGE>

FINANCIAL HIGHLIGHTS

The information below is for fiscal periods ending on October 31st of each year
and has been audited by the accounting firm of Price Waterhouse LLP. Their
report is included in the Fund's Annual Report, which is incorporated by
reference into the SAI.
<TABLE>
<CAPTION>
1997 1996 1995
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $18.20 $17.38 $14.12
- --------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income (loss) (0.01) 0.14 0.16
3. Net gains or (losses) on securities (both
realized and unrealized) 2.82 2.74 3.37
- --------------------------------------------------------------------------------
4. Total from investment operations 2.81 2.88 3.53
- --------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.08) -- (0.16)
6. Distributions (from capital gains) (2.28) (2.06) (0.11)
- --------------------------------------------------------------------------------
7. Total distributions (2.36) (2.06) (0.27)
- --------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $18.65 $18.20 $17.38
- --------------------------------------------------------------------------------
9. Total return* 17.07% 18.18% 25.53%
- --------------------------------------------------------------------------------
10. Net assets, end of period (in millions) $1,971 $2,002 $1,521
11. Average net assets for the period (in
millions) $2,046 $1,839 $1,116
12. Ratio of gross expenses to average net
assets** 0.98% 1.02% 1.14%
13. Ratio of net expenses to average net
assets** 0.96% 1.00% 1.12%
14. Ratio of net investment income/(loss) to
average net assets** 0.21% 0.45% 0.50%
15. Portfolio turnover rate** 157% 1.77% 201%
16. Average commission rate $.0441 $.0383 N/A
- --------------------------------------------------------------------------------

<CAPTION>
1994 1993(1)
<S> <C> <C>
- -------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $11.70 $10.00
- -------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income (loss) 0.02 (0.01)
3. Net gains or (losses) on securities (both
realized and unrealized) 2.40 1.71
- -------------------------------------------------------------------
4. Total from investment operations 2.42 1.70
- -------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) -- --
6. Distributions (from capital gains) -- --
- -------------------------------------------------------------------
7. Total distributions -- --
- -------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $14.12 $11.70
- -------------------------------------------------------------------
9. Total return* 20.68% 17.00%
- -------------------------------------------------------------------
10. Net assets, end of period (in millions) $596 $113
11. Average net assets for the period (in
millions) $258 $67
12. Ratio of gross expenses to average net
assets** N/A N/A
13. Ratio of net expenses to average net
assets** 1.33% 1.75%
14. Ratio of net investment income/(loss) to
average net assets** 0.25% (0.40%)
15. Portfolio turnover rate** 283% 151%
16. Average commission rate N/A N/A
- -------------------------------------------------------------------
</TABLE>

(1) Fiscal period from May 3, 1993 (inception) to October 31, 1993.
* Total return is not annualized for periods of less than one full year.
** Annualized for periods of less than one full year.

4 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

UNDERSTANDING THE
FINANCIAL HIGHLIGHTS

TOTAL RETURN is the percentage increase or decrease in the value of an
investment over a stated period of time. Total return 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.

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.

AVERAGE COMMISSION RATE is the total of the Fund's agency commissions paid on
equity securities trades divided by the number of shares purchased and sold.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 5
<PAGE>

THE FUND IN DETAIL

This section takes a closer look at the Fund's investment objective, policies
and the securities in which the Fund invests. 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 material changes.

You should also carefully review the "Additional Risk Factors" section of this
Prospectus for a more detailed discussion of the risks associated with certain
investment techniques. Appendix A includes more detailed descriptions of
investment terms used throughout this Prospectus.

INVESTMENT OBJECTIVE
The investment objective of the Fund is long-term growth of capital. It is a
diversified 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.

TYPES OF INVESTMENTS
The Fund invests primarily in common stocks selected for their growth potential.
The 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 opportunity for capital growth from such
securities or to receive a return on idle cash. The Fund may invest up to 25% of
its assets in mortgage- and asset-backed securities, up to 10% of its assets in
zero coupon, pay-in-kind and step-coupon securities, and without limit in
indexed/structured securities. The Fund will invest less than 35% of its assets
in high-yield/high-risk securities. The Fund may also purchase 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 manager believes that market conditions are not
favorable for profitable investing or when the portfolio manager is otherwise
unable to locate investment opportunities with favorable risk/reward
characteristics, 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 manager
has committed available assets to desirable investment opportunities. When the
Fund is hedged or its investments in cash or similar

6 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

investments increase, it may not participate in 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 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. The Fund may use options, futures and other types of derivatives for
hedging purposes or for non-hedging purposes such as seeking to enhance return.
See "Additional Risk Factors" on page 9. 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.

Q: HOW ARE COMMON STOCKS SELECTED?

A: The Fund 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. The portfolio manager
generally takes a "bottom up" approach to building the portfolio. In other
words, the manager generally seeks 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.

Q: ARE THE SAME CRITERIA USED
TO SELECT FOREIGN SECURITIES?

Q: WHAT IS THE MAIN RISK OF INVESTING
IN A GROWTH FUND?

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 7
<PAGE>

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 page 9.

Q: HOW DOES THE FUND
TRY TO REDUCE RISK?

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

- - The Fund will invest no more than 25% of its total assets in a single issuer
(other than U.S. government securities).

INDUSTRY CONCENTRATION
As a fundamental policy, the Fund will not invest 25% or more of its total
assets in any particular industry (excluding U.S. government securities.)

8 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

portfolio whenever its portfolio manager believes such changes are desirable.
Portfolio turnover rates are generally not a factor in making buy and sell
decisions.

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. If illiquid securities exceed 15% of the Fund's net
assets after the time of purchase the Fund will take steps to reduce in an
orderly fashion its holdings of illiquid securities. 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 will follow guidelines
established by the Trustees of the Trust ("Trustees") in making liquidity
determinations for Rule 144A securities and other securities, including
privately placed commercial paper.

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

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

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

- - 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.

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. Smaller or newer 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

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 9
<PAGE>

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 larger and more established issuers, and
may be subject to wider price fluctuations. Investments in such companies tend
to be more volatile and somewhat more speculative.

SPECIAL SITUATIONS
Special situations may include, among others, significant changes in a company's
allocation of its existing capital, a restructuring of assets, 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, may
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:

10 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - 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 most 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.

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

- - the risk that interest rates, securities prices and currency markets will not
move in the directions that the portfolio manager anticipates;

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

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

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

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 11
<PAGE>

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.

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

See Appendix A for risks associated with certain other investments.

12 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

PERFORMANCE TERMS

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 13
<PAGE>

SHAREHOLDER'S MANUAL

MINIMUM INVESTMENTS*

QUICK ADDRESS AND TELEPHONE REFERENCE

14 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one person.
Joint accounts have two or more owners.

- - 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.

- - 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.

Investors Fiduciary Trust Company serves as custodian for the tax-deferred
accounts offered by the Fund. You will be charged an account maintenance fee of
$12 for each Fund account, up to a maximum of $24 for two or more Fund accounts
registered under the same taxpayer identification number. Each Janus fund you
own under your IRA account number is considered a "Fund account." You may pay
the fee by check or have it automatically deducted from your account (usually in
December). The Fund reserves the right to change the amount of this fee or to
waive it in whole or in part for certain types of accounts.

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

- - REGULAR AND ROTH INDIVIDUAL RETIREMENT ACCOUNTS ("IRAS"): Both types of IRAs
allow most individuals under the age of 70 1/2 with earned income to
contribute up to the lesser of $2,000 ($4,000 for most married couples) or
100% of compensation annually. Please refer to the Janus IRA booklet for more
complete information regarding IRAs.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 15
<PAGE>

- - PROFIT SHARING OR MONEY PURCHASE PENSION PLAN: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees and
themselves.

- - 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.

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 and make
your check payable to Janus. The Fund is available only to U.S. citizens or
residents, and your application will be returned if you do not meet these
criteria. Send all items to one of the following addresses:

For Overnight Carrier
- --------------------
Janus
Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811

For All Other Inquiries
- ---------------------
Janus
P.O. Box 173375
Denver, CO 80217-3375

100 Fillmore Street, Suite 100
Denver, CO 80206

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

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:

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

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

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

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

- - 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.

16 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 17
<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 20.

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.

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

- - 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 or known to engage in excessive trading
(including market timing transactions).

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

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

- - Be sure that you read the prospectus for the fund into which you are
exchanging.

18 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - 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.

IN WRITING
To request a redemption in writing, please follow the instructions for written
requests noted on page 20.

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 request redemptions daily from your account by calling 1-800-525-3713 by the
close of the regular trading session of the New York Stock Exchange ("NYSE"),
normally 4:00 p.m., New York time. You may also use Janus Xpress Line
1-888-979-7737, for access to this option 24 hours a day. Redemption requests
received through Janus Xpress Line will be processed at the NAV next calculated
after receipt and acceptance of the request. (There is a daily limit of $100,000
per account for redemptions payable by check).

PAYMENT OF REDEMPTION PROCEEDS
- - 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.

If you would like to establish the electronic redemption option on an existing
account, please call 1-800-525-3713 to request the appropriate form.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 19
<PAGE>

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 16 and must include the following
information:

- - the name of the Fund,

- - the account number,

- - the amount of money or number of shares being redeemed,

- - the name(s) on the account,

- - the signature(s) of all registered account owners, and

- - your daytime telephone number.

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

- - SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

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

- - You request a redemption that exceeds $100,000.

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

20 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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

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.

PRICING OF FUND SHARES
All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved by the Fund (or its
designated agent). The Fund's NAV is calculated at the close of the regular
trading session of 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 of the NYSE. The Fund's portfolio
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.

SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JANUS XPRESS LINE(TM)
Janus Xpress Line, our electronic telephone service, offers you 24-hour access
by TouchTone(TM) telephone to obtain information on account balances, Fund
performance or dividends. You can also make exchanges, purchases, redemptions
and electronic transfers in existing accounts, request literature about any
Janus fund, or order duplicate statements. Janus Xpress Line is accessed by
calling 1-888-979-7737. Calls are limited to five minutes.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 21
<PAGE>

ACCOUNT MINIMUMS
Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 minimum balance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
on page 14 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 in September and
the $10 fee will be 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.

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 believed to be detrimental
to the Fund.

22 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

TEMPORARY SUSPENSION OF SERVICES
The Fund or its agents may, in case of emergency, temporarily suspend telephone
transactions and other shareholder services.

STATEMENTS AND REPORTS
Investors participating in an automatic investment program will receive
quarterly confirmations of all transactions. The Fund will send you a
transaction confirmation statement after every non-systematic transaction. The
Fund distributes dividend information annually.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 23
<PAGE>

MANAGEMENT OF THE FUND

Janus Capital began serving as investment adviser to certain series of the Trust
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.

PORTFOLIO MANAGER
WARREN B. LAMMERT is Executive Vice President and portfolio manager of the Fund.
Mr. Lammert joined Janus Capital in 1987 and has managed the Fund since its
inception. He previously managed Janus Balanced Fund from its inception to
December 1993, and co-managed Janus Venture Fund from December 1993 to February
1997. 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. He is a
Chartered Financial Analyst.

24 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

believes is not detrimental to the Fund or Janus Capital's other advisory
clients. See the SAI for more detailed information.

The management fee schedule above was effective July 1, 1997. The actual
management fee paid by the Fund for the fiscal year ended October 31, 1997, was
0.67% of the value of the Fund's average daily net assets. As asset size
increases, the annual rate of the management fee declines in accordance with the
above schedule. 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.

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 to execute transactions.
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 serving to reduce those expenses. The SAI further explains the
selection of broker-dealers.

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

CUSTODIAN
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 25
<PAGE>

TRANSFER AGENT
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375

DISTRIBUTOR
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206-4928

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital.

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 19 separate
series, three of which currently offer three classes of shares. The Trust
currently offers the other 18 series by separate 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 the Fund's interest
in the matter differs from the interest of the other portfolios of the Trust. As
a shareholder, you are entitled to one vote for each share that you own.

26 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 27
<PAGE>

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS

TO AVOID TAXATION, THE INTERNAL REVENUE CODE REQUIRES THE FUND TO DISTRIBUTE NET
INCOME AND ANY NET CAPITAL GAINS REALIZED ON ITS INVESTMENTS ANNUALLY. THE
FUND'S INCOME FROM DIVIDENDS AND INTEREST AND ANY NET REALIZED SHORT-TERM
CAPITAL GAINS ARE PAID TO SHAREHOLDERS AS ORDINARY INCOME 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.

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.

28 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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.

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. The Fund
may from year to year make the election permitted under Section 853 of the
Internal Revenue Code to pass through such taxes to shareholders as a foreign
tax credit. If such an election is not made, any foreign taxes paid or accrued
will represent an expense to the Fund which will reduce its investment income.

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 29
<PAGE>

APPENDIX A

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.

30 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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. To avoid taxes and interest that the
Fund must pay if these investments are profitable, the Fund may make various
elections permitted by the tax laws. These elections could require that the Fund
recognize taxable income, which in turn must be distributed, before the
securities are sold and before cash is received to pay the distributions.

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 MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 31
<PAGE>

32 JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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).

JANUS MERCURY FUND PROSPECTUS FEBRUARY 17, 1998 33

<PAGE>
[JANUS LOGO]

P.O. Box 173375 o Denver, CO 80217-3375 o 1-800-525-3713
Janus Distributors, Inc. Member NASD. (2/98)

<PAGE>
JANUS OVERSEAS FUND
PROSPECTUS

[JANUS LOGO]

<PAGE>

JANUS OVERSEAS FUND

100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com

FEBRUARY 17, 1998

Janus Overseas Fund (the "Fund") is a no-load, diversified mutual fund that
seeks long-term growth of capital by investing primarily in common stocks of
foreign issuers.

For complete information on how to purchase, exchange and sell shares, please
see the Shareholder's Manual beginning on page 14.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC NOR HAS THE SEC 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 OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

CONTENTS

<TABLE>
<S> <C>
THE FUND AT A GLANCE
Brief description of the Fund................ 2
EXPENSE INFORMATION
The Fund's annual operating expenses......... 3
Financial Highlights - a summary of financial
data....................................... 4
THE FUND IN DETAIL
Investment Objective and Policies............ 6
General Portfolio Policies................... 8
Additional Risk Factors...................... 10
PERFORMANCE TERMS
An Explanation of Performance Terms.......... 13
SHAREHOLDER'S MANUAL
Minimum Investments.......................... 14
Types of Account Ownership................... 14
How to Open Your Janus Account............... 16
How to Purchase Shares....................... 16
How to Exchange Shares....................... 18
How to Redeem Shares......................... 19
Shareholder Services and Account Policies.... 21
MANAGEMENT OF THE FUND
Investment Adviser and Investment
Personnel................................. 24
Personal Investing........................... 25
Management Expenses.......................... 25
Portfolio Transactions....................... 25
Other Service Providers...................... 26
Other Information............................ 26
DISTRIBUTIONS AND TAXES
Distributions................................ 28
Taxes........................................ 29
APPENDIX A
Glossary of Investment Terms................. 30
</TABLE>

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 1
<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:
The investment objective of the Fund is long-term growth of capital.

PRIMARY HOLDINGS:
A diversified fund that pursues its investment objective primarily through
investments in common stocks of foreign companies.

SHAREHOLDER'S INVESTMENT HORIZON:
The Fund is designed for investors who seek growth of capital and who can
tolerate the greater risks associated with investments in common stocks of
foreign issuers. The Fund is not designed as a short-term trading vehicle and
should not be relied upon for short-term financial needs.

FUND MANAGER:
Helen Young Hayes

ASSISTANT FUND MANAGER:
Laurence J. Chang

FUND INCEPTION:
May 1994

2 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

EXPENSE INFORMATION

SHAREHOLDER TRANSACTION EXPENSES

* There is an $8 service fee for redemptions by wire.

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

<TABLE>
<S> <C>
- ------------------------------------------------------------
Management Fee 0.66%
Other Expenses 0.36%
- ------------------------------------------------------------
Total Operating Expenses 1.02%
- ------------------------------------------------------------
</TABLE>

(1)The Management Fee reflects a reduced fee schedule effective July 1, 1997,
applied to net assets as of October 31, 1997. Other Expenses are based on
expenses before offset arrangements for the fiscal year ended October 31,
1997.

EXAMPLE

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

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 OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 3
<PAGE>

FINANCIAL HIGHLIGHTS

The information below is for the fiscal period ending on October 31st of each
year and has been audited by the accounting firm of Price Waterhouse LLP. Their
report is included in the Fund's Annual Report, which is incorporated by
reference into the SAI.

<TABLE>
<CAPTION>
1997 1996 1995 1994(1)
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $14.81 $11.58 $10.36 $10.00
- ---------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income (loss) 0.04 0.10 0.12 (0.02)
3. Net gains or (losses) on securities (both realized
and unrealized) 3.39 3.34 1.10 0.38
- ---------------------------------------------------------------------------------------------------
4. Total from investment operations 3.43 3.44 1.22 0.36
- ---------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.04) (0.11) -- --
6. Distributions (from capital gains) (0.26) (0.10) -- --
- ---------------------------------------------------------------------------------------------------
7. Total distributions (0.30) (0.21) -- --
- ---------------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $17.94 $14.81 $11.58 $10.36
- ---------------------------------------------------------------------------------------------------
9. Total return* 23.56% 30.19% 11.78% 3.60%
- ---------------------------------------------------------------------------------------------------
10. Net assets, end of period (in millions) $3,205 $773 $111 $64
11. Average net assets for the period (in millions) $2,093 $335 $78 $37
12. Ratio of gross expenses to average net assets** 1.03% 1.26% N/A N/A
13. Ratio of net expenses to average net assets** 1.01% 1.23% 1.73% 2.16%
14. Ratio of net investment income/(loss) to average net
assets** 0.81% 0.73% 0.36% (0.64%)
15. Portfolio turnover rate** 72% 71% 188% 181%
16. Average commission rate $.0329 $.0234 N/A N/A
- ---------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal period from May 2, 1994 (inception) to October 31, 1994.
* Total return is not annualized for periods of less than one full year.
** Annualized for periods of less than one full year.

4 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

UNDERSTANDING THE
FINANCIAL HIGHLIGHTS

NET GAINS OR (LOSSES) 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) are 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. Total return 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.

RATIO OF GROSS EXPENSES TO AVERAGE NET ASSETS is the total of the Fund's
operating expenses before expense offset arrangements divided by its average net
assets for the stated period. The Fund was not required to disclose the ratio of
gross expenses to average net assets prior to 1995. RATIO OF GROSS EXPENSES TO
AVERAGE NET ASSETS does not reflect reductions in expenses through the use of
brokerage commissions and uninvested cash balances earning interest or balance
credits.

RATIO OF NET INVESTMENT INCOME TO AVERAGE NET ASSETS is the Fund's total net
investment income divided by its average net assets for the stated period.

AVERAGE COMMISSION RATE is the total of the Fund's agency commissions paid on
equity securities trades divided by the number of shares purchased and sold.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 5
<PAGE>

THE FUND IN DETAIL

You should carefully consider your own investment goals, time horizon (the
amount of time you plan to hold your shares of a Fund) and risk tolerance before
investing in the Fund. 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. There is no guarantee that the Fund will meet its investment objective.

You should also carefully review the "Additional Risk Factors" section of this
Prospectus for a more detailed discussion of the risks associated with certain
investment techniques. Appendix A includes more detailed descriptions of
investment terms used throughout this Prospectus.

INVESTMENT OBJECTIVE
The investment objective of the 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
The Fund invests primarily in common stocks of foreign issuers selected for
their growth potential. The Fund may invest to a lesser degree in other types of
securities, including preferred stocks, warrants, convertible securities and
debt securities when its portfolio manager perceives an opportunity for capital
growth from such securities or to receive a return on idle cash. The Fund may
invest up to 25% of its assets in mortgage- and asset-backed securities, up to
10% of its assets in zero coupon, pay-in-kind and step coupon securities, and
without limit in indexed/structured securities. The Fund will invest less than
35% of its assets in high-yield/high-risk securities. The Fund may also purchase
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 manager believes that market conditions are not
favorable for profitable investing or when the portfolio manager is otherwise
unable to locate

6 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

investment opportunities with favorable risk/reward characteristics, 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 manager has committed
available assets to desirable investment opportunities. When the Fund is hedged
or its investments in cash position increase, it may not participate in market
advances or declines to the extent that it would if the Fund was not hedged or
remained more fully invested in common stocks.

The 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. See "Additional Risk
Factors" on page 10.

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

Q: HOW ARE COMMON STOCKS SELECTED?

A: The Fund may invest substantially all of its assets in common stocks of
foreign issuers to the extent its portfolio manager believes that the relevant
market environment favors profitable investing in those securities. The
portfolio manager generally takes a "bottom up" approach to building the
portfolio. In other words, the manager seeks to identify individual companies
with earnings growth potential that may not be recognized by the market at large
regardless of country of organization or place of principal business activity.
Although themes may emerge in the Fund, securities are generally selected
without regard to any defined allocation among countries, geographic regions or
industry sectors, 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.

Q: ARE THE SAME CRITERIA USED TO SELECT FOREIGN SECURITIES?

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 7
<PAGE>

economic growth among countries, regions or geographic areas may warrant greater
consideration in selecting foreign stocks. The Fund may invest without limit in
foreign securities. See "Additional Risk Factors" on page 10.

Q: WHAT IS THE MAIN RISK OF INVESTING
IN A GROWTH FUND?

A: Since the Fund usually invests heavily in common stocks, the fundamental
risk is the risk that the value of the stocks the Fund 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 page 10.

Q: HOW DOES THE FUND TRY TO REDUCE RISK?

A: 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 the portfolio from movements in
securities prices and interest rates. The Fund may also use a variety of
currency hedging techniques, including forward currency contracts, to manage
exchange rate risk. See "Additional Risk Factors" on page 10.

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

- - The Fund will invest no more than 25% of its total assets in a single issuer
(other than U.S. government securities).

8 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

INDUSTRY CONCENTRATION
As a fundamental policy, the Fund will not invest 25% or more of its total
assets in any particular industry (excluding 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,
anticipated 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 manager believes such changes are desirable. Portfolio turnover rates
are generally not a factor in making buy and sell decisions.

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

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

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

- - 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.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 9
<PAGE>

ADDITIONAL RISK FACTORS
FOREIGN SECURITIES
Investments in foreign securities, including those of foreign governments, may
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:

- - 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.

10 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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.

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

- - the risk that interest rates, securities prices and currency markets will not
move in the directions that the portfolio manager anticipates;

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

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

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

When the Fund invests in a derivative instrument, it may be required to
segregate cash and other 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.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 11
<PAGE>

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.

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

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.

SHORT SALES
The Fund may engage in "short sales against the box." This technique involves
selling either a security that the Fund owns, or a security equivalent in kind
and amount to the security sold short that the Fund has the right to obtain, for
delivery at a specified date in the future. The Fund will enter into a short
sale against the box to hedge against anticipated declines in the market price
of portfolio securities. If the value of the securities sold short increases
prior to the scheduled delivery date, the Fund loses the opportunity to
participate in the gain.

See Appendix A for risk associated with certain other investments.

12 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

PERFORMANCE TERMS

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 13
<PAGE>

SHAREHOLDER'S MANUAL

MINIMUM INVESTMENTS*

QUICK ADDRESS AND TELEPHONE REFERENCE

14 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one person.
Joint accounts have two or more owners.

- - 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.

- - 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.

Investors Fiduciary Trust Company serves as custodian for the tax-deferred
accounts offered by the Fund. You will be charged an account maintenance fee of
$12 for each Fund account, up to a maximum of $24 for two or more Fund accounts
registered under the same taxpayer identification number. Each Janus fund you
own under your IRA account number is considered a separate "Fund account." You
may pay the fee by check or have it automatically deducted from your account
(usually in December). The Funds reserve the right to change the amount of this
fee or to waive it in whole or in part for certain types of accounts.

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

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 15
<PAGE>

- - PROFIT SHARING OR MONEY PURCHASE PENSION PLAN: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees and
themselves.

- - 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.

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 and make
your check payable to Janus. The Funds are available only to U.S. citizens or
residents, and your application will be returned if you do not meet these
criteria. Send all items to one of the following addresses:

For Overnight Carrier
- --------------------
Janus
Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811

For All Other Inquiries
- ---------------------
Janus
P.O. Box 173375
Denver, CO 80217-3375

INVESTOR SERVICE CENTERS
Janus 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: Monday-Friday 7:00 a.m. to 6:00
p.m. Mountain time and Saturday 9:00 a.m. to 1:00 p.m. Mountain time.

100 Fillmore Street, Suite 100
Denver, CO 80206

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

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:

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

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

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

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

- - 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.

16 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 17
<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 20.

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

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

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

- - Be sure that you read the prospectus for the fund into which you are
exchanging.

18 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - 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.

IN WRITING
To request a redemption in writing, please follow the instructions for written
requests noted on page 20.

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 request redemptions daily from your account by calling 1-800-525-3713 by the
close of the regular trading session of the New York Stock Exchange ("NYSE"),
normally 4:00 p.m., New York time. You may also use Janus Xpress Line
1-888-979-7737, for access to this option 24 hours a day. Redemption requests
received through Janus Xpress Line will be processed at the NAV next calculated
after receipt and acceptance of the request. (There is a daily limit of $100,000
per account for redemptions payable by check).

PAYMENT OF REDEMPTION PROCEEDS
- - 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.

If you would like to establish the electronic redemption option on an existing
account, please call 1-800-525-3713 to request the appropriate form.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 19
<PAGE>

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 16 and must include the following
information:

- - the name of the Fund,

- - the account number,

- - the amount of money or number of shares being redeemed,

- - the name(s) on the account,

- - the signature(s) of all registered account owners, and

- - your daytime telephone number.

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

- - SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

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

- - You request a redemption that exceeds $100,000.

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

20 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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

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.

PRICING OF FUND SHARES
All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved by the Fund (or its
designated agent). The Fund's NAV is calculated at the close of the regular
trading session of 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 of the NYSE. The Fund's portfolio
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.

SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JANUS XPRESS LINE(TM)
Janus Xpress Line, our electronic telephone service, offers you 24-hour access
by TouchTone(TM) telephone to obtain information on account balances, Fund
performance or dividends. You can also make exchanges, purchases, redemptions
and electronic transfers in existing accounts, request literature about any
Janus fund, or order duplicate statements. Janus Xpress Line is accessed by
calling 1-888-979-7737. Calls are limited to five minutes.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 21
<PAGE>

ACCOUNT MINIMUMS
Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 minimum balance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
on page 14 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 in September and
the $10 fee will be 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.

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 believed to be detrimental
to the Fund.

22 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

TEMPORARY SUSPENSION OF SERVICES
The Fund or its agents may, in case of emergency, temporarily suspend telephone
transactions and other shareholder services.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 23
<PAGE>

MANAGEMENT OF THE FUND

INVESTMENT PERSONNEL
PORTFOLIO MANAGER
HELEN YOUNG HAYES is Executive Vice President and portfolio manager of the Fund,
which she has managed since its inception. Ms. Hayes joined Janus Capital in
1987 and has also managed or co-managed Janus Worldwide Fund since its
inception. She holds a Bachelor of Arts in Economics from Yale University and is
a Chartered Financial Analyst.

ASSISTANT PORTFOLIO MANAGER
LAURENCE J. CHANG is assistant portfolio manager of the Fund and Janus Worldwide
Fund. He received an undergraduate degree with honors in religion and philosophy
from Dartmouth College and a Master's Degree in Political Science from Stanford
University. He is a Chartered Financial Analyst.

24 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

<TABLE>
<CAPTION>
AVERAGE DAILY NET ASSETS OF FUND ANNUAL RATE PERCENTAGE (%)
<S> <C>
----------------------------------------------------------------------
First $300 Million 0.75
Next $200 Million 0.70
Next $500 Million 0.65
----------------------------------------------------------------------
</TABLE>

The management fee schedule above was effective July 1, 1997. The actual
management fee paid by the Fund for the fiscal year ended October 31, 1997, was
0.67% 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.

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 to execute transactions.
The 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 serving
to reduce those expenses. The SAI further explains the selection of
broker-dealers.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 25
<PAGE>

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

CUSTODIAN
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351

TRANSFER AGENT
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375

DISTRIBUTOR
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206-4928

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital.

26 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 27
<PAGE>

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS

TO AVOID TAXATION, THE INTERNAL REVENUE CODE REQUIRES THE FUND TO DISTRIBUTE NET
INCOME AND ANY NET GAINS REALIZED ON ITS INVESTMENTS ANNUALLY. THE FUND'S INCOME
FROM DIVIDENDS AND INTEREST AND ANY NET REALIZED SHORT-TERM CAPITAL GAINS ARE
PAID TO SHAREHOLDERS AS ORDINARY INCOME 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.

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 the Fund at one of the addresses listed on page 16 or calling
1-800-525-3713. The Fund offers 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.

28 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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 meets these requirements so that any earnings on your
investment will not be taxed twice.

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 29
<PAGE>

APPENDIX A

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.

30 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

PASSIVE FOREIGN INVESTMENT COMPANIES ("PFICS") are any foreign corporations
which generate 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. To avoid taxes and interest that the Fund must
pay if these investments are profitable, the Fund may make various elections
permitted by the tax laws. These elections could require that the Fund recognize
taxable income, which in turn must be distributed, before the securities are
sold and before cash is received to pay the distributions.

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 OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 31
<PAGE>

II. FUTURES, OPTIONS AND OTHER DERIVATIVES
FORWARD CONTRACTS are contracts to purchase or sell a specified amount of a
financial instrument 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 on the value of securities denominated in, or whose value is
tied to, a currency other than the U.S. dollar or to reduce the impact of
currency appreciation on purchases of such securities. It may also enter into
forward contracts to purchase or sell securities or other financial indices.

32 JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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).

JANUS OVERSEAS FUND PROSPECTUS FEBRUARY 17, 1998 33

<PAGE>
[JANUS LOGO]

P.O. Box 173375 o Denver, CO 80217-3375 o 1-800-525-3713
Janus Distributors, Inc. Member NASD. (2/98)

<PAGE>
JANUS TWENTY FUND
PROSPECTUS

[JANUS LOGO]
<PAGE>

JANUS TWENTY FUND

100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com

FEBRUARY 17, 1998

Janus Twenty Fund (the "Fund") is a no-load, nondiversified mutual fund that
seeks long-term growth of capital by normally concentrating its investments in a
core position of 20-30 common stocks.

For complete information on how to purchase, exchange and sell shares, please
see the Shareholder's Manual beginning on page 15.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC NOR HAS THE SEC 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 TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

CONTENTS

<TABLE>
<S> <C>
THE FUND AT A GLANCE
Brief description of the Fund................ 2
EXPENSE INFORMATION
The Fund's annual operating expenses......... 3
Financial Highlights - a summary of financial
data....................................... 4
THE FUND IN DETAIL
Investment Objective and Policies............ 7
General Portfolio Policies................... 9
Additional Risk Factors...................... 11
PERFORMANCE TERMS
An Explanation of Performance Terms.......... 14
SHAREHOLDER'S MANUAL
Minimum Investments.......................... 15
Types of Account Ownership................... 15
How to Open Your Janus Account............... 17
How to Purchase Shares....................... 17
How to Exchange Shares....................... 19
How to Redeem Shares......................... 20
Shareholder Services and Account Policies.... 22
MANAGEMENT OF THE FUND
Investment Adviser and Portfolio Manager..... 25
Personal Investing........................... 25
Management Expenses.......................... 26
Portfolio Transactions....................... 26
Other Service Providers...................... 26
Other Information............................ 27
DISTRIBUTIONS AND TAXES
Distributions................................ 29
Taxes........................................ 30
APPENDIX A
Glossary of Investment Terms................. 31
</TABLE>

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 1
<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:
The Fund seeks long-term growth of capital.

PRIMARY HOLDINGS:
A nondiversified fund that pursues its objective by normally concentrating its
investments in a core position of 20-30 common stocks.

FUND MANAGER:
Scott W. Schoelzel

FUND INCEPTION:
April 30, 1985

2 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

EXPENSE INFORMATION

SHAREHOLDER TRANSACTION EXPENSES

* There is an $8 service fee for redemptions by wire.

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

<TABLE>
<S> <C>
- ------------------------------------------------------------
Management Fee 0.66%
Other Expenses 0.27%
- ------------------------------------------------------------
Total Operating Expenses 0.93%
- ------------------------------------------------------------
</TABLE>

EXAMPLE

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

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 TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 3
<PAGE>

FINANCIAL HIGHLIGHTS

Unless otherwise noted, the information below is for fiscal periods ending on
October 31st of each year. The accounting firm of Price Waterhouse LLP has
audited the Fund's financial statements beginning with the year ended October
31, 1990. Their report is included in the Fund's Annual Report, which is
incorporated by reference into the SAI.
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $31.90 $30.12 $24.24 $25.85 $22.75
- ------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income (0.09) 0.37 0.01 0.16 0.17
3. Net gains or (losses) on securities
(both realized and unrealized) 8.85 6.68 5.94 (1.07) 3.31
- ------------------------------------------------------------------------------------------------
4. Total from investment operations 8.76 7.05 5.95 (0.91) 3.48
- ------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.18) -- (0.07) (0.25) (0.18)
6. Distributions (from capital gains) (5.32) (5.27) -- (0.45) (0.20)
- ------------------------------------------------------------------------------------------------
7. Total distributions (5.50) (5.27) (0.07) (0.70) (0.38)
- ------------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $35.16 $31.90 $30.12 $24.24 $25.85
- ------------------------------------------------------------------------------------------------
9. Total return* 31.65% 27.59% 24.67% (3.52%) 15.39%
- ------------------------------------------------------------------------------------------------
10. Net assets, end of period (in millions) $5,871 $3,937 $2,996 $2,743 $3,749
11. Average net assets for the period (in
millions) $4,990 $3,386 $2,716 $3,051 $3,546
12. Ratio of gross expenses to average net
assets** 0.93% 0.93% 1.00% N/A N/A
13. Ratio of net expenses to average net
assets** 0.91% 0.92% 0.99% 1.02% 1.05%
14. Ratio of net investment income to
average net assets** 0.33% 0.67% 0.62% 0.57% 0.87%
15. Portfolio turnover rate** 123% 137% 147% 102% 99%
16. Average commission rate $.0567 $.0571 N/A N/A N/A
- ------------------------------------------------------------------------------------------------

<CAPTION>
1992(1)
<S> <C>
- ----------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $22.17
- ----------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.09
3. Net gains or (losses) on securities
(both realized and unrealized) 0.49
- ----------------------------------------------------
4. Total from investment operations 0.58
- ----------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) --
6. Distributions (from capital gains) --
- ----------------------------------------------------
7. Total distributions --
- ----------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $22.75
- ----------------------------------------------------
9. Total return* 2.62%
- ----------------------------------------------------
10. Net assets, end of period (in millions) $2,434
11. Average net assets for the period (in
millions) $2,221
12. Ratio of gross expenses to average net
assets** N/A
13. Ratio of net expenses to average net
assets** 1.12%
14. Ratio of net investment income to
average net assets** 1.27%
15. Portfolio turnover rate** 79%
16. Average commission rate N/A
- ----------------------------------------------------
</TABLE>

(1) Fiscal period from June 1, 1992 to October 31, 1992.
* Total return is not annualized for periods of less than one full year.
** Annualized for periods of less than one full year.

4 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

<TABLE>
<CAPTION>
(CONTINUED) 1992(1) 1991(1) 1990(1) 1989(1) 1988(1)
<S> <C> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF PERIOD $18.88 $16.01 $13.05 $9.66 $13.69
- ---------------------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.11 0.16 0.05 0.46 0.42
3. Net gains or (losses) on securities (both
realized and unrealized) 3.62 2.90 3.35 3.73 (2.86)
- ---------------------------------------------------------------------------------------------------------
4. Total from investment operations 3.73 3.06 3.40 4.19 (2.44)
- ---------------------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment income) (0.02) (0.19) (0.02) (0.80) (0.41)
6. Distributions (from capital gains) (0.42) -- (0.42) -- (1.18)
- ---------------------------------------------------------------------------------------------------------
7. Total distributions (0.44) (0.19) (0.44) (0.80) (1.59)
- ---------------------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $22.17 $18.88 $16.01 $13.05 $9.66
- ---------------------------------------------------------------------------------------------------------
9. Total return* 19.60% 19.43% 26.36% 45.89% (17.13%)
- ---------------------------------------------------------------------------------------------------------
10. Net assets, end of period (in millions) $2,081 $556 $175 $20 $13
11. Average net assets for the period (in millions) $1,188 $294 $64 $10 $16
12. Ratio of gross expenses to average net assets** N/A N/A N/A N/A N/A
13. Ratio of net expenses to average net assets** 1.01% 1.07% 1.32% 1.88% 1.70%
14. Ratio of net investment income to average net
assets** 1.08% 1.30% 1.28% 0.68% 3.35%
15. Portfolio turnover rate** 83% 163% 228% 220% 317%
16. Average commission rate N/A N/A N/A N/A N/A
- ---------------------------------------------------------------------------------------------------------
</TABLE>

(1) Fiscal year ended on May 31st of each year.
* Total return is not annualized for periods of less than one full year.
** Annualized for periods of less than one full year.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 5
<PAGE>

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 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.

TOTAL RETURN is the percentage increase or decrease in the value of an
investment over a stated period of time. Total return 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.

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.

AVERAGE COMMISSION RATE is the total of the Fund's agency commissions paid on
equity securities trades divided by the number of shares purchased and sold.

6 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

THE FUND IN DETAIL

You should also carefully review the "Additional Risk Factors" section of this
Prospectus for a more detailed discussion of the risks associated with certain
investment techniques. Appendix A includes more detailed descriptions of
investment terms used throughout this Prospectus.

INVESTMENT OBJECTIVE
The investment objective of the 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.

TYPES OF INVESTMENTS
The Fund invests primarily in common stocks selected for their growth potential.
The 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 opportunity for capital growth from such
securities or to receive a return on idle cash. The Fund may invest up to 25% of
its assets in mortgage- and asset-backed securities, up to 10% of its assets in
zero coupon, pay-in-kind and step coupon securities, and without limit in
indexed/structured securities. The Fund will invest less than 35% of its assets
in high-yield/ high-risk securities. The Fund may also purchase 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.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 7
<PAGE>

that it would if the Fund was not hedged or it remained more fully invested in
common stocks.

The Fund may invest without limit in foreign equity and debt securities. The
Fund 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. The Fund may use options, futures and other types of derivatives for
hedging purposes or for non-hedging purposes such as seeking to enhance return.
See "Additional Risk Factors" on page 11. The Fund may purchase securities on a
when-issued, delayed delivery or forward commitment basis.

The Fund may invest in "Special Situations" from time to time. A special
situation arises when, in the opinion of the 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. See "Additional Risk
Factors" on page 11.

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

Q: HOW ARE COMMON STOCKS SELECTED?

A: The Fund may invest 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. The portfolio manager
generally takes a "bottom up" approach to building the portfolio. In other
words, the portfolio manager seeks 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.

Q: ARE THE SAME CRITERIA TO SELECT FOREIGN SECURITIES?

A: Generally, yes. The portfolio manager seeks companies that meet his
selection criteria, 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 11.

Q: WHAT IS THE MAIN RISK OF INVESTING IN A GROWTH FUND?

A: Since the Fund usually invests heavily in common stocks, the fundamental
risk is that the value of the stocks it holds might decrease. Stock values
may fluctuate in

8 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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.

Q: HOW DOES A DIVERSIFIED FUND DIFFER FROM A NONDIVERSIFIED FUND?

A: A "nondiversified" fund has the ability to take larger positions in a
smaller number of issuers than a diversified fund. Because the appreciation
or depreciation of a single stock may have a greater impact on the share
price of a nondiversified fund, it can be expected to fluctuate more than a
comparable diversified fund.

Q: HOW DOES THE FUND TRY TO REDUCE RISK?

A: The Fund may use futures, options and other derivative instruments to
protect its portfolio from movements in securities prices and interest
rates. The Fund may also use a variety of currency hedging techniques,
including forward currency contracts, to manage exchange rate risk. See
"Additional Risk Factors" on page 11.

GENERAL PORTFOLIO POLICIES
In investing its 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
nondiversified fund under the 1940 Act and is subject to the following
diversification requirements:

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

- - As a fundamental policy, with respect to 50% 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.

- - The Fund will invest no more than 25% of its total assets in a single issuer
(other than U.S. government securities).

- - The Fund reserves the right to become a diversified company by limiting the
investments in which more than 5% of its total assets are invested.

INDUSTRY CONCENTRATION
As a fundamental policy, the Fund will not invest 25% or more of its total
assets in any particular industry (excluding U.S. government securities).

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 9
<PAGE>

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

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

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

- - 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.

10 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - 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.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 11
<PAGE>

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 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.

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

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

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

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

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

12 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

See Appendix A for risks associated with certain other investments.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 13
<PAGE>

PERFORMANCE TERMS

14 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

SHAREHOLDER'S MANUAL

MINIMUM INVESTMENTS*

QUICK ADDRESS AND TELEPHONE REFERENCE

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 15
<PAGE>

- - INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one person.
Joint accounts have two or more owners.

- - 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.

- - 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.

TAX-DEFERRED ACCOUNTS
If you are eligible, you may set up one or more tax-deferred accounts. A
tax-deferred account allows you to shelter your investment income and capital
gains from current income taxes. A contribution to certain of these plans may
also be tax deductible. Tax-deferred accounts include retirement plans and the
Education IRA. Distributions from these plans are generally subject to income
tax and may be subject to an additional tax if withdrawn prior to age 59 1/2 or
used for a nonqualifying purpose. Investors should consult their tax advisor or
legal counsel before selecting a tax-deferred account.

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

16 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - PROFIT SHARING OR MONEY PURCHASE PENSION PLAN: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees and
themselves.

- - 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.

For Overnight Carrier
- --------------------
Janus

Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811

For All Other Inquiries
- ---------------------
Janus

P.O. Box 173375
Denver, CO 80217-3375

100 Fillmore Street, Suite 100
Denver, CO 80206

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

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:

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

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

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

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

- - 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.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 17
<PAGE>

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

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.

18 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<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 21.

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

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

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

- - Be sure that you read the prospectus for the fund into which you are
exchanging.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 19
<PAGE>

- - 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.

IN WRITING
To request a redemption in writing, please follow the instructions for written
requests noted on page 21.

PAYMENT OF REDEMPTION PROCEEDS
- - 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.

If you would like to establish the electronic redemption option on an existing
account, please call 1-800-525-3713 to request the appropriate form.

20 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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:

- - the name of the Fund,

- - the account number,

- - the amount of money or number of shares being redeemed,

- - the name(s) on the account,

- - the signature(s) of all registered account owners, and

- - your daytime telephone number.

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

- - SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

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

- - You request a redemption that exceeds $100,000.

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

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 21
<PAGE>

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

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

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.

SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JANUS XPRESS LINE
Janus Xpress Line, our electronic telephone service, offers you 24-hour access
by TouchTone(TM) telephone to obtain information on account balances, Fund
performance or dividends. You can also make exchanges, purchases, redemptions
and electronic transfers in existing accounts, request literature about any
Janus fund, or order duplicate statements. Janus Xpress Line is accessed by
calling 1-888-979-7737. Calls are limited to five minutes.

22 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

ACCOUNT MINIMUMS
Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 minimum balance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
on page 15 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, for purposes of this policy, accounts
will be valued in September, and the $10 fee will be 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.

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 believed to be detrimental
to the Fund.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 23
<PAGE>

TEMPORARY SUSPENSION OF SERVICES
The Fund or its agents may, in case of emergency, temporarily suspend telephone
transactions and other shareholder services.

24 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

MANAGEMENT OF THE FUND

INVESTMENT PERSONNEL
PORTFOLIO MANAGER
SCOTT W. SCHOELZEL is Executive Vice President and portfolio manager of the
Fund, which he has managed since August 1997. He previously managed Janus
Olympus Fund from its inception to August 1997. Mr. Schoelzel joined Janus
Capital in January 1994 as Vice President of Investments. From 1991-1993, Mr.
Schoelzel was a portfolio manager at Founders Asset Management, Denver,
Colorado. He holds a Bachelor of Arts in Business from Colorado College.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 25
<PAGE>

believes is not detrimental to the Fund or Janus Capital's other advisory
clients. See the SAI for more detailed information.

The management fee schedule above was effective July 1, 1997. The actual
management fee paid by the Fund for the fiscal year ended October 31, 1997, was
0.66% of the value of the Fund's average daily net assets. As asset size
increases, the annual rate of the management fee declines in accordance with the
above schedule. In addition, 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.

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

CUSTODIAN
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351

26 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

TRANSFER AGENT
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375

DISTRIBUTOR
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206-4928

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital.

SIZE OF THE FUND
The 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 the Fund are discontinued, it is expected that
existing shareholders of the Fund would be permitted to continue to purchase
shares and to reinvest any dividends or capital gains distributions, absent
highly unusual circumstances.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 27
<PAGE>

28 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS

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 the Fund at one of the addresses on page 17 or calling
1-800-525-3713. The Fund offers 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.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 29
<PAGE>

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.

30 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

APPENDIX A

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.

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 31
<PAGE>

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.

32 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998 33
<PAGE>

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).

34 JANUS TWENTY FUND PROSPECTUS FEBRUARY 17, 1998

<PAGE>
[JANUS LOGO]

P.O. Box 173375 o Denver, CO 80217-3375 o 1-800-525-3713
Janus Distributors, Inc. Member NASD. (2/98)

<PAGE>
JANUS WORLDWIDE FUND
PROSPECTUS

[JANUS LOGO]

<PAGE>

JANUS WORLDWIDE FUND

100 Fillmore Street
Denver, CO 80206-4928
1-800-525-3713
http://www.Janus.com

FEBRUARY 17, 1998

Janus Worldwide Fund (the "Fund") is a no-load, diversified mutual fund that
seeks long-term growth of capital by investing primarily in common stocks of
foreign and domestic issuers.

For complete information on how to purchase, exchange and sell shares, please
see the Shareholder's Manual beginning on page 13.

THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC NOR HAS THE SEC 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 WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

CONTENTS

<TABLE>
<S> <C>
THE FUND AT A GLANCE
Brief description of the Fund................ 2
EXPENSE INFORMATION
The Fund's annual operating expenses......... 3
Financial Highlights - a summary of financial
data....................................... 4
THE FUND IN DETAIL
Investment Objective and Policies............ 6
General Portfolio Policies................... 8
Additional Risk Factors...................... 9
PERFORMANCE TERMS
An Explanation of Performance Terms.......... 12
SHAREHOLDER'S MANUAL
Minimum Investments.......................... 13
Types of Account Ownership................... 13
How to Open Your Janus Account............... 15
How to Purchase Shares....................... 15
How to Exchange Shares....................... 17
How to Redeem Shares......................... 18
Shareholder Services and Account Policies.... 20
MANAGEMENT OF THE FUND
Investment Adviser and Investment
Personnel................................. 23
Personal Investing........................... 24
Management Expenses.......................... 24
Portfolio Transactions....................... 24
Other Service Providers...................... 25
Other Information............................ 25
DISTRIBUTIONS AND TAXES
Distributions................................ 27
Taxes........................................ 28
APPENDIX A
Glossary of Investment Terms................. 29
</TABLE>

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 1
<PAGE>

THE FUND AT A GLANCE

INVESTMENT OBJECTIVE:
The investment objective of the Fund is long-term growth of capital in a manner
consistent with the preservation of capital.

PRIMARY HOLDINGS:
A diversified fund that pursues its objective primarily through investments in
common stocks of foreign and domestic issuers.

SHAREHOLDER'S INVESTMENT HORIZON:
The Fund is designed for long-term investors who seek growth of capital 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 MANAGER:
Helen Young Hayes

ASSISTANT FUND MANAGER:
Laurence J. Chang

FUND INCEPTION:
May 1991

2 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

EXPENSE INFORMATION

SHAREHOLDER TRANSACTION EXPENSES

* There is an $8 service fee for redemptions by wire.

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

<TABLE>
<S> <C>
- ------------------------------------------------------------
Management Fee 0.65%
Other Expenses 0.31%
- ------------------------------------------------------------
Total Operating Expenses 0.96%
- ------------------------------------------------------------
</TABLE>

EXAMPLE

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

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 WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 3
<PAGE>

FINANCIAL HIGHLIGHTS

Unless otherwise noted, the information below is for fiscal periods ending on
October 31st of each year and has been audited by the accounting firm of Price
Waterhouse LLP. Their report is included in the Fund's Annual Report, which is
incorporated by reference into the SAI.
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C>
- -------------------------------------------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF
PERIOD $34.60 $27.65 $27.00 $24.16 $18.95
- -------------------------------------------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income (0.08) 0.49 0.81 0.15 0.14
3. Net gains or (losses) on
securities (both realized and
unrealized) 7.73 7.79 1.39 3.34 5.29
- -------------------------------------------------------------------------------------------
4. Total from investment operations 7.65 8.28 2.20 3.49 5.43
- -------------------------------------------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment
income) (0.15) (0.26) (0.54) (0.27) (0.22)
6. Distributions (from capital gains) (2.05) (1.07) (1.01) (0.38) --
- -------------------------------------------------------------------------------------------
7. Total distributions (2.20) (1.33) (1.55) (0.65) (0.22)
- -------------------------------------------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $40.05 $34.60 $27.65 $27.00 $24.16
- -------------------------------------------------------------------------------------------
9. Total return* 23.34% 31.00% 8.89% 14.76% 28.79%
- -------------------------------------------------------------------------------------------
10. Net assets, end of period (in
millions) $10,358 $4,467 $1,804 $1,587 $755
11. Average net assets for the period
(in millions) $7,784 $2,953 $1,622 $1,244 $379
12. Ratio of gross expenses to average
net assets** 0.97% 1.02% 1.24% N/A N/A
13. Ratio of net expenses to average
net assets** 0.95% 1.01% 1.23% 1.12% 1.32%
14. Ratio of net investment income to
average net assets** 0.65% 0.73% 0.99% 0.42% 0.92%
15. Portfolio turnover rate** 79% 80% 142% 158% 124%
16. Average commission rate $.0561 $.0311 N/A N/A N/A
- -------------------------------------------------------------------------------------------

<CAPTION>
1992 1991(1)
<S> <C> <C>
- ----------------------------------------------------------
1. NET ASSET VALUE, BEGINNING OF
PERIOD $17.45 $15.00
- ----------------------------------------------------------
INCOME FROM INVESTMENT OPERATIONS:
2. Net investment income 0.16 --
3. Net gains or (losses) on
securities (both realized and
unrealized) 1.39 2.45
- ----------------------------------------------------------
4. Total from investment operations 1.55 2.45
- ----------------------------------------------------------
LESS DISTRIBUTIONS:
5. Dividends (from net investment
income) -- --
6. Distributions (from capital gains) (0.05) --
- ----------------------------------------------------------
7. Total distributions (0.05) --
- ----------------------------------------------------------
8. NET ASSET VALUE, END OF PERIOD $18.95 $17.45
- ----------------------------------------------------------
9. Total return* 9.20% 16.00%
- ----------------------------------------------------------
10. Net assets, end of period (in
millions) $161 $18
11. Average net assets for the period
(in millions) $80 $7
12. Ratio of gross expenses to average
net assets** N/A N/A
13. Ratio of net expenses to average
net assets** 1.73% 2.50%
14. Ratio of net investment income to
average net assets** 1.74% 0.02%
15. Portfolio turnover rate** 147% 40%
16. Average commission rate N/A N/A
- ----------------------------------------------------------
</TABLE>

(1) Fiscal period from May 1, 1991 to October 31, 1991.
* Total return is not annualized for periods of less than one full year.
** Annualized for periods of less than one full year.

4 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

UNDERSTANDING THE
FINANCIAL HIGHLIGHTS

TOTAL RETURN is the percentage increase or decrease in the value of an
investment over a stated period of time. Total return 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.

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.

AVERAGE COMMISSION RATE is the total of the Fund's agency commissions paid on
equity securities trades divided by the number of shares purchased and sold.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 5
<PAGE>

THE FUND IN DETAIL

You should carefully consider your own investment goals, time horizon (the
amount of time you plan to hold your shares of the Fund) and risk tolerance
before investing in a Fund. 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. There is no guarantee that the Fund will meet
its investment objective.

You should also carefully review the "Additional Risk Factors" section of this
Prospectus for a more detailed discussion of the risks associated with certain
investment techniques. Appendix A includes a more detailed description of
investment terms used throughout this Prospectus.

INVESTMENT OBJECTIVE
The investment objective of the 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 other organizations of any size, regardless of country of
organization or place of principal business activity. The 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.

TYPES OF INVESTMENTS
The Fund invests primarily in common stocks selected for their growth potential.
The 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 opportunity for capital growth from such
securities or to receive a return on idle cash. The Fund may invest up to 25% of
its assets in mortgage- and asset-backed securities, up to 10% of its assets in
zero coupon, pay-in-kind and step-coupon securities, and without limit in
indexed/structured securities. The Fund will invest less than 35% of its assets
in high-yield/high-risk securities. The Fund may also purchase 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.

6 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 manager has committed available assets to
desirable investment opportunities. When the Fund is hedged or its investments
in cash or similar investments increase, it may not participate in market
advances or declines to the extent that it would if the Fund was not hedged or
it remained more fully invested in common stocks.

The Fund may invest without limit in foreign equity and debt securities. The
Fund 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. The Fund may use options, futures and other types of derivatives for
hedging purposes or for non-hedging purposes such as seeking to enhance return.
See "Additional Risk Factors" on page 9. The Fund may purchase securities on a
when-issued, delayed delivery or forward commitment basis.

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. See "Additional Risk
Factors" on page 9.

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

Q: HOW ARE COMMON STOCKS SELECTED?

A: The Fund may invest 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. The portfolio manager
generally takes a "bottom up" approach to building the portfolio. In other
words, the manager seeks 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.

Q: ARE THE SAME CRITERIA USED
TO SELECT FOREIGN SECURITIES?

A: Generally, yes. The portfolio manager seeks companies that meet her
selection criteria on a worldwide basis, 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 stocks. The Fund may invest without limit in
foreign securities. See "Additional Risk Factors" on page 9.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 7
<PAGE>

Q: WHAT IS THE MAIN RISK OF INVESTING
IN A GROWTH FUND?

A: Since the Fund usually invests heavily in common stocks, the fundamental
risk is 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.

Q: HOW DOES THE FUND
TRY TO REDUCE RISK?

A: 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 the portfolio from
movements in securities prices and interest rates. The Fund may also use a
variety of currency hedging techniques, including forward currency contracts, to
manage exchange rate risk. See "Additional Risk Factors" on page 9.

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

- - The Fund will invest no more than 25% of its total assets in a single issuer
(other than U.S. government securities).

INDUSTRY CONCENTRATION
As a fundamental policy, the Fund will not invest 25% or more of its total
assets in any particular industry (excluding 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,

8 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 manager believes such
changes are desirable. Portfolio turnover rates are generally not a factor in
making buy and sell decisions.

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. If illiquid securities exceed 15% of the Fund's net
assets after the time of purchase, the Fund will take steps to reduce in an
orderly fashion its holdings of illiquid securities. 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 will follow guidelines
established by the Trustees of the Trust ("Trustees") in making liquidity
determinations for Rule 144A securities and other securities, including
privately placed commercial paper.

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

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

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

- - 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.

- - 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

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 9
<PAGE>

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
denominated 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.

- - 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 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.

10 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

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

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

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

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

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 11
<PAGE>

securities. 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.

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

See Appendix A for risks associated with certain other investments.

PERFORMANCE TERMS

12 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

SHAREHOLDER'S MANUAL

MINIMUM INVESTMENTS*

QUICK ADDRESS AND TELEPHONE REFERENCE

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 13
<PAGE>

- - INDIVIDUAL OR JOINT OWNERSHIP. Individual accounts are owned by one person.
Joint accounts have two or more owners.

- - 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.

- - 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.

Investors Fiduciary Trust Company serves as custodian for the tax-deferred
accounts offered by the Fund. You will be charged an account maintenance fee of
$12 for each Fund account, up to a maximum of $24 for two or more Fund accounts
registered under the same taxpayer identification number. Each Janus fund you
own under your IRA account number is considered a separate "Fund account." You
may pay the fee by check or have it automatically deducted from your account
(usually in December). The Fund reserves the right to change the amount of this
fee or to waive it in whole or in part for certain types of accounts.

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

14 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

- - PROFIT SHARING OR MONEY PURCHASE PENSION PLAN: These plans are open to
corporations, partnerships and sole proprietors to benefit their employees and
themselves.

- - 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.

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 and make
your check payable to Janus. The Fund is available only to U.S. citizens or
residents, and your application will be returned if you do not meet these
criteria. Send all items to one of the following addresses:

For Overnight Carrier
- --------------------

Janus
Suite 101
3773 Cherry Creek North Drive
Denver, CO 80209-3811

For All Other Inquiries
- ---------------------

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

100 Fillmore Street, Suite 100
Denver, CO 80206

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

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:

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

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

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

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

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 15
<PAGE>

- - 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.

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

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.

16 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<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 19.

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

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

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 17
<PAGE>

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

- - Be sure that you read the prospectus for the fund into which you are
exchanging.

- - 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.

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

PAYMENT OF REDEMPTION PROCEEDS
- - 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.

If you would like to establish the electronic redemption option on an existing
account, please call 1-800-525-3713 to request the appropriate form.

18 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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 15 and must include the following
information:

- - the name of the Fund,

- - the account number,

- - the amount of money or number of shares being redeemed,

- - the name(s) on the account,

- - the signature(s) of all registered account owners, and

- - your daytime telephone number.

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

- - SOLE PROPRIETOR, GENERAL PARTNER: Written instructions must be signed by an
authorized individual in his/her capacity as it appears on the account
registration.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 19
<PAGE>

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

- - You request a redemption that exceeds $100,000.

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

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

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

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.

PRICING OF FUND SHARES
All purchases, redemptions and exchanges will be processed at the NAV next
calculated after your request is received and approved by the Fund (or its
designated agent). The Fund's NAV is calculated at the close of the regular
trading session of 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 of the NYSE. The Fund's portfolio
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.

SHAREHOLDER SERVICES AND ACCOUNT POLICIES
JANUS XPRESS LINE(TM)
Janus Xpress Line, our electronic telephone service, offers you 24-hour access
by TouchTone(TM) telephone to obtain information on account balances, Fund
performance or dividends. You can also make exchanges, purchases, redemptions
and electronic transfers in existing accounts, request literature about any
Janus fund, or order duplicate

20 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

statements. Janus Xpress Line is accessed by calling 1-888-979-7737. Calls are
limited to five minutes.

ACCOUNT MINIMUMS
Due to the proportionately higher costs of maintaining small accounts, Janus
reserves the right to deduct a $10 minimum balance fee (or the value of the
account if less than $10) from accounts with values below the minimums described
on page 13 or 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 in September and
the $10 fee will be 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.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 21
<PAGE>

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 believed to be detrimental
to the Fund.

TEMPORARY SUSPENSION OF SERVICES
The Fund or its agents may, in case of emergency, temporarily suspend telephone
transactions and other shareholder services.

STATEMENTS AND REPORTS
Investors participating in an automatic investment program will receive
quarterly confirmations of all transactions. In addition, the Fund will send you
a transaction confirmation statement after every non-systematic transaction. The
Fund distributes dividend information annually.

22 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

MANAGEMENT OF THE FUND

INVESTMENT PERSONNEL

PORTFOLIO MANAGER
HELEN YOUNG HAYES is Executive Vice President and portfolio manager of the Fund,
which she has managed or co-managed since its inception. Ms. Hayes joined Janus
Capital in 1987 and has also managed Janus Overseas Fund since its inception.
She holds a Bachelor of Arts in Economics from Yale University and is a
Chartered Financial Analyst.

ASSISTANT PORTFOLIO MANAGER
LAURENCE J. CHANG is assistant portfolio manager of the Fund and Janus Overseas
Fund. He received an undergraduate degree with honors in religion and philosophy
from Dartmouth College and a Master's Degree in Political Science from Stanford
University. He is a Chartered Financial Analyst.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 23
<PAGE>

The management fee schedule above was effective July 1, 1997. The actual
management fee paid by the Fund for the fiscal year ended October 31, 1997, was
0.66% of the value of the Fund's average daily net assets. As asset size
increases, the annual rate of the management fee declines in accordance with the
above schedule. 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.

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 to execute transactions.
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 serving to reduce those expenses. The SAI further explains the
selection of broker-dealers.

24 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

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

CUSTODIAN
State Street Bank and Trust Company
P.O. Box 0351
Boston, Massachusetts 02117-0351

TRANSFER AGENT
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375

DISTRIBUTOR
Janus Distributors, Inc.
100 Fillmore Street
Denver, Colorado 80206-4928

Janus Service Corporation and Janus Distributors, Inc. are wholly-owned
subsidiaries of Janus Capital.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 25
<PAGE>

26 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

DISTRIBUTIONS AND TAXES

DISTRIBUTIONS

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 the Fund at one of the addresses listed on page 15 or calling
1-800-525-3713. The Fund offers 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.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 27
<PAGE>

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.

28 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

APPENDIX A

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.

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 29
<PAGE>

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.

30 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998
<PAGE>

JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998 31
<PAGE>

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).

32 JANUS WORLDWIDE FUND PROSPECTUS FEBRUARY 17, 1998

<PAGE>
[JANUS LOGO]

P.O. Box 173375 o Denver, CO 80217-3375 o 1-800-525-3713
Janus Distributors, Inc. Member NASD. (2/98)