Janus Aspen Series
Money Market Portfolio
Prospectus
[Logo] Janus
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Contents
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THE PORTFOLIO AT A GLANCE
Brief description of the Portfolio .. 1
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EXPENSE INFORMATION
The Portfolio's annual
operating expenses ............... 1
Financial Highlights -
a summary of financial data ...... 2
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PERFORMANCE TERMS
An explanation of performance terms . 3
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THE PORTFOLIO IN DETAIL
Investment Objective and Policies ... 4
Investment Policies ................. 4
Types of Investments ................ 4
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MANAGEMENT OF THE PORTFOLIO
Investment Adviser and
Investment Personnel ............. 7
Management Expenses ................. 8
Portfolio Transactions .............. 8
Other Service Providers ............. 8
Other Information ................... 8
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DISTRIBUTIONS AND TAXES
Distributions ...................... 10
Taxes .............................. 10
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SHAREHOLDER'S GUIDE
Purchases .......................... 11
Redemptions ........................ 11
Shareholder Communications ......... 11
Janus Aspen Series
Money Market Portfolio
Prospectus
May 1, 1997
Money Market Portfolio (the "Portfolio") is a money market mutual fund that
seeks maximum current income to the extent consistent with the stability of
capital. The Portfolio pursues its objective by investing primarily in high
quality debt obligations and obligations of financial institutions.
The Portfolio is a series of Janus Aspen Series (the "Trust") and currently
offers two classes of shares. The Trust is registered with the Securities and
Exchange Commission ("SEC") as an open-end management investment company. The
Institutional Shares of the Portfolio (the "Shares") are offered by this
prospectus in connection with investment in and payments under variable annuity
contracts and variable life insurance contracts (collectively "variable
insurance contracts"), as well as certain qualified retirement plans. The
Institutional Shares are sold under the name "Janus Aspen Series." The Trust
sells and redeems its Shares at net asset value without any sales charges,
commissions or redemption fees. Each variable insurance contract involves fees
and expenses not described in this Prospectus. See the accompanying contract
prospectus for information regarding contract fees and expenses and any
restrictions on purchases or allocations.
This Prospectus contains information about the Shares that a prospective
purchaser of a variable insurance contract or plan participant should consider
before allocating purchase payments or premiums to the Portfolio. It should be
read carefully in conjunction with the separate account prospectus of the
specific insurance product that accompanies this Prospectus and retained for
future reference. Additional information about the Shares is contained in a
Statement of Additional Information ("SAI") filed with the SEC. The SAI dated
May 1, 1997 is incorporated by reference into this Prospectus. Copies of the SAI
are available upon request and without charge by writing or calling your
insurance company or plan sponsor.
AN INVESTMENT IN THE MONEY MARKET PORTFOLIO IS NEITHER INSURED NOR GUARANTEED BY
THE U.S. GOVERNMENT. THERE IS NO ASSURANCE THAT THE MONEY MARKET PORTFOLIO WILL
BE ABLE TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
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.
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Portfolio At A Glance
This section is designed to provide you with a brief overview of the Portfolio
and its investment emphasis. A more detailed discussion of the Portfolio's
investment objective and policies begins on page 4.
INVESTMENT OBJECTIVE:
The investment objective of the Portfolio is to seek maximum current income to
the extent consistent with the stability of capital.
PRIMARY HOLDINGS:
The Portfolio seeks to achieve this investment objective by investing primarily
in high quality debt obligations and obligations of financial institutions.
SHAREHOLDER'S INVESTMENT HORIZON:
The Portfolio is designed for investors who seek maximum current income to the
extent consistent with the stability of capital.
FUND ADVISER:
Janus Capital Corporation ("Janus Capital") serves as the Portfolio's investment
adviser. Janus Capital has been in the investment advisory business for over 26
years and currently manages approximately $50 billion in assets.
PORTFOLIO MANAGER:
Sharon S. Pichler
PORTFOLIO INCEPTION:
May 1995
Expense Information
The tables and example below are designed to assist participants in qualified
plans that invest in the Shares of the Portfolio in understanding the various
costs and expenses that you will bear directly or indirectly as an investor in
the Shares. Owners of variable insurance contracts that invest in the Shares
should refer to the variable insurance contract prospectus for a description of
costs and expenses, as the tables and example do not reflect deductions at the
separate account level or contract level for any charges that may be incurred
under a contract.
SHAREHOLDER TRANSACTION EXPENSES
Maximum sales load imposed on purchases None
Maximum sales load imposed on reinvested dividends None
Deferred sales charges on redemptions None
Redemption fee None
Exchange fee None
ANNUAL OPERATING EXPENSES (after fee waivers)(1)
(expressed as a percentage of average net assets)
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Management Fee 0.00%
Other Expenses 0.50%
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Total Operating Expenses 0.50%
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(1) The fees and expenses in the table above are based on expenses of the
Shares for the fiscal year ended December 31, 1996. The information is net
of fee waivers from Janus Capital. Fee waivers are applied first against
the management fee and then against other expenses. Without such waivers,
the Management Fee, Other Expenses and Total Operating Expenses for the
Shares would have been 0.25%, 0.53% and 0.78%, respectively. Janus Capital
may modify or terminate the waivers at any time upon at least 90 days'
notice to the Trustees.
EXAMPLE
1 Year 3 Years 5 Years 10 Years
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You would indirectly pay the following
expenses on a $1,000 investment,
assuming an expense ratio as listed
above and assuming a 5% annual return
with or without redemption at the end
of each period. $5 $16 $28 $63
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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 ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 1
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Financial Highlights
Unless otherwise noted, the information below is for fiscal periods ending on
December 31 of each year. The accounting firm of Price Waterhouse LLP has
audited the Portfolio's financial statements since its inception. Their report
is included in the Portfolio's Annual Report, which is incorporated by reference
into the SAI. A detailed explanation of the Financial Highlights can be found
on page 3.
<TABLE>
<CAPTION>
1996 1995(1)
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<S> <C> <C>
1. Net asset value, beginning of period $1.00 $1.00
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Income from investment operations:
2. Net investment income .05 .04
3. Net gains or (losses) on securities (both realized and unrealized) -- --
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4. Total from investment operations .05 .04
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Less distributions:
5. Dividends (from net investment income) (.05) (.04)
6. Tax return of capital distributions -- --
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7. Total distributions (.05) (.04)
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8. Net asset value, end of period $1.00 $1.00
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9. Total return* 5.05% 3.63%
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10. Net assets, end of period (in thousands) $6,016 $1,735
11. Ratio of expenses to average net assets 0.50%(3) 0.50%(2)
12. Ratio of net investment income to average net assets** 4.93% 5.30%
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</TABLE>
* Total return not annualized for periods of less than one year.
** Annualized for periods of less than one full year.
(1) May 1, 1995 (inception) to December 31, 1995.
(2) The ratio was 1.07% before waiver of certain fees incurred by the Portfolio.
(3) The ratio was 0.78% before waiver of certain fees incurred by the Portfolio.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 2
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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 Portfolio's
Annual Report contains additional information about the Portfolio's performance,
including a comparison to an appropriate securities index. To request a copy of
the Annual Report, please call or write your insurance company.
Net asset value ("NAV") is the value of a single Share of the Portfolio. It is
computed by adding the value of all of the Portfolio's investments and other
assets, subtracting any liabilities and dividing the result by the number of
shares outstanding. The NAV of the Portfolio's Shares is expected to be $1.00.
Net investment income is the per share amount of dividends and interest income
earned on securities held by the Portfolio, less Portfolio expenses. Dividends
(from net investment income) are the per share amount that the Portfolio paid
from net investment income.
Net gains or (losses) on securities is the per share increase or decrease in
value of the securities the Portfolio 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 Portfolio 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. 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. THE PORTFOLIO'S TOTAL RETURN CANNOT BE COMPUTED
DIRECTLY FROM THE FINANCIAL HIGHLIGHTS TABLE.
Ratio of expenses to average net assets is the total of the Portfolio's
operating expenses divided by its average net assets for the stated period.
Ratio of net investment income to average net assets is the Portfolio's net
investment income divided by its average net assets for the stated period.
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Performance Terms
This section will help you understand various terms that are commonly used to
describe the Portfolio's performance. You may see references to these terms in
our newsletters or advertisements (or those published by participating insurance
companies) and in media articles. Newsletters and advertisements may include
comparisons of the Portfolio's performance to the performance of other mutual
funds, mutual fund averages or recognized stock market indices. The Portfolio
generally measures performance in terms of yield.
Yield shows the rate of income the Shares earn on investments as a percentage of
the Share price. It is calculated by dividing net investment income for a 30-day
period (7-day period for the Portfolio) by the average number of Shares entitled
to receive dividends and dividing the result by the Share's NAV per share at the
end of the 30-day period. Yield does not include changes in NAV.
Yields are calculated according to standardized SEC formulas and may not equal
the income on an investor's account. Yield is usually quoted on an annualized
basis. An annualized yield represents the amount you would earn if you remained
in a Portfolio for a year and the Shares of that Portfolio continued to have the
same yield for the entire year.
Effective yield is similar to yield in that it is calculated over the same time
frame, but instead the net investment income is compounded and then annualized.
Due to the compounding effect, the effective yield will normally be higher than
the yield.
The Portfolio imposes no sales or other charges that would affect yield
computations. The Portfolio's yield figures include the effect of deducting the
Portfolio's expenses, but may not include charges and expenses attributable to
any particular insurance product. Portfolio 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 shares, when
redeemed, may be worth more or less than their original cost.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 3
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The Portfolio in Detail
This section takes a closer look at the Portfolio's investment objective,
policies and the securities in which it invests. Please carefully review the
"Additional Risk Factors" section of this Prospectus for a more detailed
discussion of the risks associated with certain investment techniques. You
should carefully consider your investment goals, time horizon and risk tolerance
before investing in the Portfolio.
The Portfolio's investment objective and policies are similar to those of Janus
Money Market Fund, a retail fund managed by Janus Capital. Although it is
anticipated that the Portfolio and Janus Money Market Fund will hold similar
securities, differences in asset size and cash flow needs as well as the
relative weightings of securities selections may result in differences in
investment performance. Expenses of the Portfolio and Janus Money Market Fund
are expected to differ. The variable contract owner will also bear various
insurance-related costs at the insurance company level. You should review the
accompanying separate account prospectus for a summary of contract fees and
expenses.
Policies that are noted as "fundamental" cannot be changed without a shareholder
vote. All other policies, including the Portfolio's investment objective, are
not fundamental and may be changed by the Portfolio's Trustees without a
shareholder vote. You will be notified of any such changes that are material. If
there is a material change in the Portfolio's objective or policies, you should
consider whether the Portfolio remains an appropriate investment for your
variable insurance contract or qualified retirement plan.
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The Portfolio is designed for investors who primarily seek maximum current
income to the extent consistent with stability of capital.
MONEY MARKET PORTFOLIO
INVESTMENT OBJECTIVE
The Portfolio's investment objective is to seek maximum current income to the
extent consistent with stability of capital. There can be no assurance that the
Portfolio will achieve its investment objective or be able to maintain a stable
net asset value of $1.00 per share.
INVESTMENT POLICIES
The Portfolio will invest only in eligible high quality, short-term money market
instruments that present minimal credit risks, as determined by Janus Capital,
the Portfolio's investment adviser, pursuant to procedures adopted by the
Trustees. The Portfolio may invest only in U.S. dollar-denominated instruments
that have a remaining maturity of 397 days or less (as calculated pursuant to
Rule 2a-7 under the Investment Company Act of 1940 ("1940 Act")) and will
maintain a dollar-weighted average portfolio maturity of 90 days or less.
Except to the limited extent permitted by Rule 2a-7 and except for U.S.
Government Securities (as defined below), the Portfolio will not invest more
than 5% of its total assets in the securities of any one issuer. A guarantor is
not considered an issuer for the purpose of this limit, provided that the value
of all securities held by the Portfolio that are issued or guaranteed by that
institution shall not exceed 10% of the Portfolio's total assets. The Portfolio
may not invest more than 25% of its total assets in any one industry, except
that this limit does not apply to U.S. Government Securities, bank obligations
or municipal securities. To ensure adequate liquidity, the Portfolio may not
invest more than 10% of its net assets in illiquid securities, including
repurchase agreements maturing in more than seven days (unless subject to a
demand feature) and certain time deposits that are subject to early withdrawal
penalties and mature in more than seven days. Janus Capital determines and
monitors the liquidity of portfolio securities under the supervision of the
Trustees.
Ratings
High quality money market instruments include those that (i) are rated (or, if
unrated, are issued by an issuer with comparable outstanding short-term debt
that is rated) in one of the two highest rating categories for short-term debt
by any two nationally recognized statistical rating organizations ("NRSROs") or,
if only one NRSRO has issued a rating, by that NRSRO or (ii) are otherwise
unrated and determined by Janus Capital to be of comparable quality. The
Portfolio will invest at least 95% of its total assets in securities in the
highest rating category (as determined pursuant to Rule 2a-7). Descriptions of
the rating categories of Standard & Poor's, Moody's, and certain other NRSROs
are contained in the SAI, as is a further description of the Portfolio's
investment policies.
Although the Portfolio only invests in high quality money market instruments, an
investment in the Portfolio is subject to risk even if all securities in its
portfolio are paid in full at maturity. All money market instruments, including
U.S. Government Securities, can change in value as a result of changes in
interest rates, the issuer's actual or perceived creditworthiness or the
issuer's ability to meet its obligations.
TYPES OF INVESTMENTS
The Portfolio pursues its objective by investing primarily in high quality debt
obligations and obligations of financial institutions. It may invest in U.S.
Government Securities (as defined below) and municipal securities, although the
Portfolio expects to invest in such securities to a lesser degree.
Debt Obligations
The Portfolio may invest in debt obligations of domestic issuers, including
commercial paper (short-term promissory notes issued by companies to finance
their, or their affiliates', current obligations), notes and bonds, and variable
amount master demand notes. The payment obligations on these instruments may be
backed by securities, swap agreements or other assets, by a guarantee of a third
party or solely by the unsecured promise of the issuer to make payments when
due. The Portfolio may invest in privately issued commercial paper or other
securities that are restricted as to disposition under the federal securities
laws. In general, sales of these securities may not be made absent registration
under the Securities Act of 1933 (the "1933 Act") or the availability of an
appropriate exemption
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 4
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therefrom. Pursuant to Section 4(2) of the 1933 Act or Rule 144A adopted under
the 1933 Act, however, some of these securities are eligible for resale to
institutional investors, and accordingly, Janus Capital may determine that a
liquid market exists for such a security pursuant to guidelines adopted by the
Trustees.
Obligations of Financial Institutions
The Portfolio may invest in obligations of financial institutions. Examples of
obligations in which it may invest include negotiable certificates of deposit,
bankers' acceptances and time deposits of U.S. banks (including savings and loan
associations) having total assets in excess of one billion dollars and U.S.
branches of foreign banks having total assets in excess of ten billion dollars.
The Portfolio may also invest in Eurodollar and Yankee bank obligations as
discussed below.
Certificates of deposit represent an institution's obligation to repay funds
deposited with it that earn a specified interest rate over a given period.
Bankers' acceptances are negotiable obligations of a bank to pay a draft which
has been drawn by a customer and are usually backed by goods in international
trade. Time deposits are non-negotiable deposits with a banking institution that
earn a specified interest rate over a given period. Fixed time deposits, which
are payable at the stated maturity date and bear a fixed rate of interest,
generally may be withdrawn on demand by the Portfolio but may be subject to
early withdrawal penalties that could reduce the Portfolio's yield. Unless there
is a readily available market for them, time deposits that are subject to early
withdrawal penalties and that mature in more than seven days will be treated as
illiquid securities.
Eurodollar or Yankee Obligations
The Portfolio may invest in Eurodollar and Yankee bank obligations. Eurodollar
bank obligations are dollar-denominated certificates of deposit or time deposits
issued outside the U.S. capital markets by foreign branches of U.S. banks and by
foreign banks. Yankee bank obligations are dollar-denominated obligations issued
in the U.S. capital markets by foreign banks.
Eurodollar (and to a limited extent, Yankee) bank obligations are subject to
certain sovereign risks. One such risk is the possibility that a foreign
government might prevent dollar-denominated funds from flowing across its
borders. Other risks include: adverse political and economic developments in a
foreign country; the extent and quality of government regulation of financial
markets and institutions; the imposition of foreign withholding taxes; and
expropriation or nationalization of foreign issuers.
U.S. Government Securities
The Portfolio may invest without limit in U.S. Government Securities. U.S.
Government Securities shall have the meaning set forth in the 1940 Act. The 1940
Act defines U.S. Government Securities to include securities issued or
guaranteed by the U.S. government, its agencies and instrumentalities. U.S.
Government Securities may also include repurchase agreements collateralized by
and municipal securities escrowed with or refunded with U.S. Government
Securities. U.S. Government Securities in which the Portfolio may invest include
U.S. Treasury securities and obligations issued or guaranteed by U.S. government
agencies and instrumentalities that are backed by the full faith and credit of
the U.S. government, such as those guaranteed by the Small Business
Administration or issued by the Government National Mortgage Association. In
addition, U.S. Government Securities in which the Portfolio may invest include
securities supported primarily or solely by the creditworthiness of the issuer,
such as securities of the Federal National Mortgage Association, the Federal
Home Loan Mortgage Corporation and the Tennessee Valley Authority. There is no
guarantee that the U.S. government will support securities not backed by its
full faith and credit. Accordingly, although these securities have historically
involved little risk of loss of principal if held to maturity, they may involve
more risk than securities backed by the full faith and credit of the U.S.
government.
Municipal Securities
The municipal securities in which the Portfolio may invest include municipal
notes and short-term municipal bonds. Municipal notes are generally used to
provide for the issuer's short-term capital needs and generally have maturities
of 397 days or less. The Portfolio may also invest in high quality participation
interests in municipal securities. A more detailed description of various types
of municipal securities is contained in Appendix B in the SAI.
Yields on municipal securities are dependent on a variety of factors, including
the general conditions of the money market and of the municipal bond and
municipal note markets, the size of a particular offering, the maturity of the
obligation and the rating of the issue. Obligations of issuers of municipal
securities are subject to the provisions of bankruptcy, insolvency and other
laws affecting the rights and remedies of creditors, such as the Bankruptcy
Reform Act of 1978, as amended. Therefore, the possibility exists that, as a
result of litigation or other conditions, the ability of any issuer to pay, when
due, the principal of and interest on its municipal securities may be materially
affected.
Participation Interests
The Portfolio may invest in participation interests in any type of security in
which the Portfolio may invest. A participation interest gives a Portfolio an
undivided interest in the underlying securities in the proportion that the
Portfolio's participation interest bears to the total principal amount of the
underlying securities. Participation interests usually carry a demand feature,
as described below, backed by a letter of credit or guarantee of the institution
that issued the interests permitting the holder to tender them back to the
institution.
Demand Features
The Portfolio may invest in securities that are subject to puts and stand-by
commitments
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 5
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("demand features"). Demand features give the Portfolio the right to resell
securities at specified periods prior to their maturity dates to the seller or
to some third party at an agreed-upon price or yield. Securities with demand
features may involve certain expenses and risks, including the inability of the
issuer of the instrument to pay for the securities at the time the instrument is
exercised, non-marketability of the instrument and differences between the
maturity of the underlying security and the maturity of the instrument.
Securities may cost more with demand features than without them. Demand features
can serve three purposes: to shorten the maturity of a variable or floating rate
security, to enhance the instrument's credit quality and to provide a source of
liquidity. Demand features are often issued by third party financial
institutions, generally domestic and foreign banks. Accordingly, the credit
quality and liquidity of the Portfolio's investments may be dependent in part on
the credit quality of the banks supporting its investments. This will result in
exposure to risks pertaining to the banking industry, including the foreign
banking industry. Brokerage firms and insurance companies also provide certain
liquidity and credit support.
Variable and Floating Rate Securities
The securities in which the Portfolio invests may have variable or floating
rates of interest. These securities pay interest at rates that are adjusted
periodically according to a specified formula, usually with reference to some
interest rate index or market interest rate. Securities with ultimate maturities
of greater than 397 days may be purchased only pursuant to Rule 2a-7. Under that
Rule, only those long-term instruments that have demand features which comply
with certain requirements and certain variable rate U.S. Government Securities
may be purchased. Similar to fixed rate debt instruments, variable and floating
rate instruments are subject to changes in value based on changes in market
interest rates or changes in the issuer's or guarantor's creditworthiness. The
rate of interest on securities purchased by the Portfolio may be tied to
short-term Treasury or other government securities or indices on securities that
are permissible investments of the Portfolio, as well as other money market
rates of interest. The Portfolio will not purchase securities whose values are
tied to interest rates or indicies that are not appropriate for the duration and
volatility standards of a money market fund.
Mortgage- and Asset-Backed Securities
The Portfolio may purchase fixed or adjustable rate mortgage-backed securities
issued by the Government National Mortgage Association, Federal National
Mortgage Association or the Federal Home Loan Mortgage Corporation, or other
governmental or government-related entities. In addition, the Portfolio may
purchase other asset-backed securities, including securities backed by
automobile loans, equipment leases or credit card receivables. These securities
directly or indirectly represent a participation in, or are secured by and
payable from, fixed or adjustable rate mortgage or other loans which may be
secured by real estate or other assets. Unlike traditional debt instruments,
payments on these securities include both interest and a partial payment of
principal. Prepayments of the principal of underlying loans may shorten the
effective maturities of these securities and may result in the Portfolio having
to reinvest proceeds at a lower interest rate.
Repurchase Agreements
The Portfolio may seek additional income by entering into collateralized
repurchase agreements with respect to obligations that it could otherwise
purchase. Repurchase agreements are transactions in which the Portfolio
purchases securities and simultaneously commits to resell those securities to
the seller at an agreed-upon price on an agreed-upon future date. The resale
price reflects a market rate of interest that is not related to the coupon rate
or maturity of the purchased securities.
Reverse Repurchase Agreements
The Portfolio may enter into reverse repurchase agreements. Reverse repurchase
agreements are transactions in which the Portfolio sells a security and
simultaneously commits to repurchase that security from the buyer at an agreed
upon price on an agreed upon future date. This technique will be used primarily
for temporary or emergency purposes, such as meeting redemption requests.
Delayed Delivery Securities
The Portfolio may purchase securities on a when-issued or delayed delivery
basis. Securities so purchased are subject to market price fluctuation from the
time of purchase but no interest on the securities accrues to the Portfolio
until delivery and payment for the securities take place. Accordingly, the value
of the securities on the delivery date may be more or less than the purchase
price. Forward commitments will be entered into only when the Portfolio has the
intention of taking possession of the securities, but it may sell the securities
before the settlement date if deemed advisable.
Borrowing and Lending
The Portfolio may borrow money for temporary or emergency purposes in amounts up
to 25% of its total assets. It may not mortgage or pledge securities except to
secure permitted borrowings. As a fundamental policy, the Portfolio will not
lend securities or other assets if, as a result, more than 25% of its total
assets would be lent to other parties; however, it does not currently intend to
engage in securities lending. The Portfolio intends to seek permission from the
SEC to borrow money from or lend money to other funds that permit such
transactions and are advised by Janus Capital. There is no assurance that such
permission will be granted.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 6
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Management of the Portfolio
TRUSTEES
The Trustees oversee the business affairs of the Trust and are responsible for
major decisions relating to the Portfolio's investment objective and policies.
The Trustees delegate the day-to-day management of the Portfolio to the officers
of the Trust and meet at least quarterly to review the Portfolio'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 Portfolio and is responsible for the day-to-day
management of the investment portfolio and other business affairs of the
Portfolio.
Janus Capital has served as investment adviser to Janus Fund since its inception
in 1970 and currently serves as investment adviser to all of the Janus retail
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
Portfolio's investments. Janus Capital also furnishes certain administrative,
compliance and accounting services for the Portfolio, and may be reimbursed by
the Portfolio 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 Portfolio and pays the salaries, fees and expenses of all
Portfolio officers and those Trustees who are affiliated with Janus Capital.
Participating insurance companies that purchase the Portfolio's Shares may
perform certain administrative services relating to the Portfolio and Janus
Capital or the Portfolio may pay those companies for such services.
INVESTMENT PERSONNEL
PORTFOLIO MANAGER
Sharon S. Pichler is Executive Vice President and portfolio manager of the
Portfolio, which she has managed since inception. She also has managed Janus
Money Market Fund, Janus Government Money Market Fund and Janus Tax-Exempt Money
Market Fund since their inception. She holds a Bachelor of Arts in Economics
from Michigan State University and a Master of Business Administration from the
University of Texas at San Antonio. Ms. Pichler 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 Portfolio or
Janus Capital's other advisory clients. See the SAI for more detailed
information.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 7
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BREAKDOWN OF MANAGEMENT EXPENSES AND EXPENSE LIMITS
The Portfolio pays Janus Capital a management fee which is calculated daily. The
advisory agreement with the Portfolio spells out the management fee and other
expenses that the Portfolio must pay. The Portfolio is subject to the following
management fee schedule (expressed as an annual rate):
Average Daily Net Annual Rate Expense Limit
Assets of Portfolio Percentage (%) Percentage (%)
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All Asset Levels .25 .50
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* Janus Capital will voluntarily waive its advisory fee to the extent the
advisory fees and other expenses exceed 0.50% of the average daily closing
net asset value of the Portfolio. Janus Capital may modify or terminate
this fee waiver at any time upon at least 90 days' notice to the Trustees.
The Shares of the Portfolio incur 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 Portfolio 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 Portfolio's
transactions and recognizing brokerage, research and other services provided to
the Portfolio and to Janus Capital. Janus Capital may consider sales of shares
of the Portfolios or other Janus funds by a broker-dealer or the recommendation
of a broker-dealer to its customers that they purchase a Portfolio's shares as a
factor in the selection of broker-dealers to execute Portfolio transactions.
Janus Capital may also consider payments made by brokers effecting transactions
for the Portfolio i) to the Portfolio or ii) to other persons on behalf of the
Portfolio for services provided to the Portfolio for which it would be obligated
to pay. 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 Portfolio are effected with that
broker-dealer, the commissions payable by the Portfolio are credited against
certain Portfolio operating expenses serving to reduce those expenses. The SAI
further explains the selection of broker-dealers.
OTHER SERVICE PROVIDERS
The following parties provide the Portfolio with administrative and other
services.
Custodian
United Missouri Bank, N.A.
P.O. Box 419226
Kansas City, Missouri 64141-6226
Transfer Agent
Janus Service Corporation
P.O. Box 173375
Denver, Colorado 80217-3375
Janus Service Corporation is a wholly-owned subsidiary of Janus Capital.
OTHER INFORMATION
Organization
The Trust is a "mutual fund" that was organized as a Delaware business trust on
May 20, 1993. A mutual fund is an investment vehicle that pools money from
numerous investors and invests the money to achieve a specified objective. The
Trust offers Shares in eleven separate series, one of which is offered by this
Prospectus.
The Portfolio currently offers two classes of Shares, one of which, the
Institutional Shares, are offered pursuant to this prospectus and are sold under
the name Janus Aspen Series. The Shares offered by this Prospectus are available
only in connection with investment in and payments under variable contracts and
life insurance contracts as well as certain qualified retirement plans.
Retirement Shares of the Portfolio are offered by separate prospectus and are
available only to participant directed qualified plans using plan service
providers that are compensated for providing distribution and/or recordkeeping
and other administrative services provided to plan participants. Because the
expenses of each class may differ, the performance of each class is expected to
differ. If you would like additional information about the Retirement Shares,
please call 1-800-525-0020.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 8
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Shareholder Meetings and Voting Rights
The Trust does not intend to hold annual shareholder meetings. However, special
meetings may be called for the class or Portfolio 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 class or
Portfolio only if a matter affects or requires the vote of only the class or
Portfolio or the interest of a class or Portfolio in the matter differs from the
interest of the other class or Portfolios of the Trust. As a shareholder, you
are entitled to one vote for each share that you own.
An insurance company issuing a variable contract invested in Shares of the
Portfolio will request voting instructions from variable contract holders. Under
current law, the insurance company must vote all Shares held by the separate
account in proportion to the voting instructions received.
Conflicts of Interest
The Portfolio's Shares are available only to variable annuity and variable life
separate accounts of insurance companies that are unaffiliated with Janus
Capital and to certain qualified retirement plans. Retirement Shares of the
Portfolio (offered through a separate prospectus) are available to certain
participant directed qualified plans. Although the Portfolio currently does not
anticipate any disadvantages to policy owners arising out of the fact that it
offers its shares to such entities, there is a possibility that a material
conflict may arise. The Trustees monitor events in order to identify any
anticipated disadvantages or material irreconcilable conflicts that may arise
and to determine what action, if any, should be taken in response. If a material
disadvantage or conflict occurs, the Trustees may require one or more insurance
company separate accounts or plans to withdraw its investment in the Portfolio
or substitute shares of another portfolio of the Trust. If this occurs, the
Portfolio may be forced to sell securities at disadvantageous prices. In
addition, the Trustees may refuse to sell shares of the Portfolio to any
separate account or may suspend or terminate the offering of the Portfolio's
shares if such action is required by law or regulatory authority or is in the
best interests of the Portfolio's shareholders. It is possible that a qualified
plan investing in the Retirement Shares of the Portfolio could lose its
qualified plan status under the Internal Revenue Code, which could have adverse
tax consequences on insurance company separate accounts investing in the Shares.
Janus Capital intends to monitor such qualified plans and the Portfolio may
discontinue sales to a qualified plan and require plan participants with
existing investments in the Retirement Shares to redeem those investments if a
plan loses (or in the opinion of Janus Capital is at risk of losing) its
qualified plan status.
Master/Feeder Option
The Trust may in the future seek to achieve the Portfolio's investment objective
by investing all of the Portfolio's assets in another investment company having
the same investment objective and substantially the same investment policies and
restrictions as those applicable to the Portfolio. It is expected that any such
investment company would be managed by Janus Capital in substantially the same
manner as the existing Portfolio. The initial shareholder(s) of the Portfolio
voted to vest the authority to convert to a master/feeder structure in the sole
discretion of the Trustees. No further approval of the shareholders of the
Portfolio is required. You will receive at least 30 days' prior notice of any
such investment. Such investment would be made only if the Trustees determine it
to be in the best interests of the Portfolio and its shareholders. In making
that determination, the Trustees will consider, among other things, the benefits
to shareholders and/or the opportunity to reduce costs and achieve operational
efficiencies. Although management of the Portfolio believes the Trustees will
not approve an arrangement that is likely to result in higher costs, no
assurance is given that costs will be materially reduced if this option is
implemented.
The Valuation of Shares
The NAV of the Shares of the Portfolio is determined at the close of the regular
trading session of the New York Stock Exchange (the "NYSE") (normally 4:00 p.m.,
New York time) each day that the NYSE is open. NAV per Share is determined by
dividing the total value of the securities and other assets, less liabilities,
by the total number of Shares outstanding.
Portfolio securities are valued at their amortized cost. Amortized cost
valuation involves valuing an instrument at its cost and thereafter assuming a
constant amortization to maturity (or such other date as permitted by Rule 2a-7)
of any discount or premium. If fluctuating interest rates cause the market value
of the portfolio to deviate more than 1/2 of 1% from the value determined on the
basis of amortized cost, the Trustees will consider whether any action, such as
adjusting the Share's NAV to reflect current market conditions, should be
initiated to prevent any material dilutive effect on shareholders.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 9
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Distributions and Taxes
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DISTRIBUTIONS
To avoid taxation of the Portfolio, the Internal Revenue Code requires the
Portfolio to distribute net income and any net gains realized by its investments
annually. 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, if any, are paid to shareholders as capital gains
distributions.
Dividends representing substantially all of the net investment income and any
net realized gains on sales of securities are declared daily, Saturdays, Sundays
and holidays included, and distributed on the last business day of each month.
If a month begins on a Saturday, Sunday or holiday, dividends for those days are
declared at the end of the preceding month and distributed on the first business
day of the month. All distributions will be automatically reinvested in Shares
of the Portfolio.
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TAXES
Because Shares of the Portfolio may be purchased only through variable insurance
contracts and qualified plans, it is anticipated that any income dividends or
capital gains distributions made by the Shares of the Portfolio will be exempt
from current taxation if left to accumulate within the variable insurance
contract or qualified plan. Generally, withdrawals from such contracts may be
subject to ordinary income tax and, if made before age 59 1/2, a 10% penalty
tax. The tax status of your investment in the Shares depends on the features of
the variable insurance contracts purchased from a participating insurance
company. Further information may be found in the prospectus of the separate
account offering such contract.
The Portfolio does not expect to pay any federal income or excise taxes because
it intends to meet certain requirements of the Internal Revenue Code. In
addition, the Portfolio intends to qualify under the Internal Revenue Code with
respect to the diversification requirements related to the tax-deferred status
of insurance company separate accounts.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 10
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Shareholder's Guide
INVESTORS MAY NOT PURCHASE OR REDEEM SHARES OF THE PORTFOLIO DIRECTLY. SHARES
MAY BE PURCHASED OR REDEEMED ONLY THROUGH VARIABLE INSURANCE CONTRACTS OFFERED
BY THE SEPARATE ACCOUNTS OF PARTICIPATING INSURANCE COMPANIES OR THROUGH
QUALIFIED RETIREMENT PLANS. REFER TO THE PROSPECTUS FOR THE PARTICIPATING
INSURANCE COMPANY'S SEPARATE ACCOUNT OR YOUR PLAN DOCUMENTS FOR INSTRUCTIONS ON
PURCHASING OR SELLING OF VARIABLE INSURANCE CONTRACTS AND ON HOW TO SELECT THE
PORTFOLIO AS AN INVESTMENT OPTION FOR A CONTRACT OR A QUALIFIED PLAN.
PURCHASES
Purchases of Shares may be made only by the separate accounts of insurance
companies for the purpose of funding variable insurance contracts or by
qualified plans. Refer to the prospectus of the appropriate insurance company's
separate account or your plan documents for information on how to invest in the
Shares of the Portfolio.
All investments in the Portfolio are credited to a participating insurance
company's separate account or a qualified plan immediately upon acceptance of
the investment by the Portfolio. Investments will be processed at the NAV next
determined after an order is received and accepted by the Portfolio.
The Portfolio reserves the right to reject any specific purchase order. Purchase
orders may be refused if, in Janus Capital's opinion, they are of a size that
would disrupt the management of the Portfolio. The Portfolio may discontinue
sales of its shares if management believes that a substantial further increase
may adversely affect the Portfolio's ability to achieve its investment
objective. In such event, however, it is anticipated that existing policy owners
and plan participants invested in the Portfolio would be permitted to continue
to authorize investment in the Portfolio and to reinvest any dividends or
capital gains distributions.
REDEMPTIONS
Redemptions, like purchases, may be effected only through the separate accounts
of participating insurance companies or through qualified plans. Please refer to
the appropriate separate account prospectus or plan documents for details.
Shares of the Portfolio may be redeemed on any business day. Redemptions are
processed at the NAV next calculated after receipt and acceptance of the
redemption order by the Portfolio. Redemption proceeds will normally be wired to
the participating insurance company the business day following receipt of the
redemption order, but in no event later than seven days after receipt of such
order.
SHAREHOLDER COMMUNICATIONS
Shareholders will receive annual and semiannual reports including the financial
statements of the Shares of the Portfolio. Each report will show the investments
owned by the Portfolio and the market values thereof, as well as other
information about the Portfolio and its operations. The Trust's fiscal year ends
December 31.
JANUS ASPEN SERIES MONEY MARKET PORTFOLIO PROSPECTUS MAY 1, 1997 11
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100 Fillmore Street
Denver, Colorado 80206-4928
(800) 525-0020
[LOGO] JANUS Funds distributed by Janus Distributors, Inc.
Member NASD. Recycled Paper
