For promotional purposes This document is solely for

For promotional purposes. This document is solely for the use of professionals and is not for general public distribution. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested. Alternative credit: bringing your bonds up to speed Thursday 15 th March 2018 IAPF Trustee Network Event Dónal Kinsella FIA Client Portfolio Manager Charley Smith Associate Director of Institutional Business Mark Fulwood Head of Institutional Business Development – UK & Ireland

Bringing your bonds up to speed What you used to get What you can get now Liability hedging Diversification Exposure to new areas of bond market Interest rate protection Floating rate assets Short duration assets Complexity premium Increased yields Returns and income Total returns Income generation Income Source: Janus Henderson Investors 1

A broad opportunity set in alternative credit Finding the balance between risk, return and liquidity Liquidity profile Risk/return 7 SME Loans 6 ABS High Yield 5 Emerging Market Credit 4 Emerging Market Credit 3 Real Estate Debt 2 Infrastructure Debt 1 0 1 2 Expected risk 3 4 Source: Janus Henderson Investors, as at December 2017 For illustrative purposes only SME – Small and medium enterprise High Yield Secured Loans Real Estate Debt Infrastructure Debt Asset Backed Securities 0 Increasing liquidity Expected return Secured Loans 5 6 7 SME Loans 2

What determines the interest rate? Credit ratings – moving into higher yielding parts of the market 9% AAA rated A AA BBB BB B Yield CCC 7. 4% Increasing credit risk 6% 3. 4% 3% 2. 5% 0. 7% 0. 8% Germany 10 y Apple 1. 1% 1. 4% 0% Ireland 10 y Vodafone Ardagh Packaging Netflix Valeant Source: Janus Henderson Investors, as at 28 February 2018 3

Secured loans and high yield bonds Illustrative capital structures Seniority Senior secured high yield bond or secured loan 60% (could be mixture of the two) Secured loan 50% OR Equity 40% Senior unsecured high yield bond 10% Equity 40% Source: Janus Henderson Investors, as at December 2017 Illustrative capital structures - the percentages shown are purely used for illustration purposes 4

How do I make money in loans? Don’t lose it 19. 73% 20% Loan Default Loss Rate (8 months Later) 15% 10% 4. 59% 5% 3. 77%* 5% 3 -year discount margin Default loss rate Western European Loan Discount Margin (3 years) 0. 03%** 0% 0% Ma Se Ma Se Ma Se Ma Se r- p- r- p- r- p- r- p- r- p 04 04 05 05 06 06 07 07 08 08 09 09 10 10 11 11 12 12 13 13 14 14 15 15 16 16 17 17 Source: Credit Suisse, as at 28 February 2018 Note * As at 28 February 2018 ** As at 30 June 2017 5

Will companies keep paying their debt? Default environment expected to remain benign 18% Europe actual Europe baseline forecast US actual US baseline forecast 16% 14% 12% 10% 8% 6% 4% Apr-18 Jul-17 Oct-16 Jan-16 Apr-15 Jul-14 Oct-13 Jan-13 Apr-12 Jul-11 Oct-10 Jan-10 Apr-09 Jul-08 Oct-07 Jan-07 Apr-06 Jul-05 Oct-04 0% Jan-04 2% Source: Moody's, as at 31 December 2017 Note: Issuer weighted annual default rates 6

Flexibility in asset-backed securities markets ABS offers access to new sources of returns for investors ABS investors: • Flexibility Po o as l of se ts • • Super senior Fixed or floating coupons Choice on credit rating / risk tolerance Secured against underlying cashflows Yield enhancement versus investment -grade corporate bonds AAA ABS issuers: • Free up capital on balance sheet … • eg banks / mortgage providers B Equity 7

Bowie Bonds - Let’s Dance! Asset-backed securities Source: https: //www. flickr. com/photos/tomronworldwide/23953051439 8

What is available in ABS? Relative value versus investment grade corporate bonds 400 CLO AAA 2. 0 CLO A 2. 0 BAML Single-A Euro Corporate BAML BBB Euro Corporate 350 300 250 200 150 100 Source: Nov-17 Sep-17 Jul-17 May-17 Mar-17 Jan-17 Nov-16 Sep-16 Jul-16 May-16 Mar-16 Jan-16 Nov-15 Sep-15 Jul-15 May-15 Mar-15 Jan-15 Nov-14 Sep-14 Jul-14 May-14 Mar-14 0 Jan-14 50 Citi, JP Morgan, BAML, as at 31 December 2017 9

Think about “floating rate” assets Fixed rate coupons versus floating rate coupons Floating rate – cash + 5% coupon / income Fixed rate – 5. 5% coupon / income 9% Fixed coupon 8% 7% 9% 7% Coupon doesn’t vary 6% 6% 5% 5% 4% 4% 3% 3% 2% 2% 1% 1% 0% 0% Year 1 Year 2 Year 3 Year 4 Coupon increases in line with interest rates 8% Year 5 Year 6 • Rising yields / rates • Coupon fixed • Price generally falls Year 1 Year 2 Credit spread Year 3 Year 4 Year 5 Year 6 Interest rate component • Rising yields / rates • Coupon rises • Price generally stable Source: Janus Henderson Investors, as at February 2018 Note: For illustrative purposes only – based on an increase of 0. 5% in interest rates each year 10

Conclusion

What alternative credit aims to do Why should you be interested? • Focus on interest rate protection • Can invest in bonds with floating rate coupons Credit risk Interest rate risk Traditional corporate bond portfolio Alternative credit portfolio • Flexible investment approach • Using a number of different areas of global credit markets - Investment grade High yield Secured loans Asset-backed securities Alternative credit assets • Aims to generate returns through careful credit selection Note: For illustrative purposes only 12

Appendix

Janus Henderson Multi Asset Credit Fund Overview • • • Brings together long established areas of expertise in one pooled fund Performance target: 3 month £ Libor + 5%* • Cash and other** 7% Asset Backed Securities (ABS) 21% Secured Loans 52% What are we aiming to deliver? • • Current portfolio weights Interest rate protection Diversification Defensive senior and secured bias Currency risk hedged, no leverage Launched July 2012; £ 1, 240 m AUM High Yield 20% Source: Janus Henderson Investors, as at 31 December 2017 * For the sterling share class. Target returns are not guaranteed. Indicative level based upon current market environment and is gross over a 3 to 5 year investment horizon. ** Includes MTM of forward FX contracts and IR swap positions Figures may not add to 100 due to rounding 14

Janus Henderson Investors 201 Bishopsgate, London EC 2 M 3 AE Tel: 020 7818 1818 Fax: 020 7818 1819 This document is intended solely for the use of professionals, defined as Eligible Counterparties or Professional Clients, and is not for general public distribution. Past performance is not a guide to future performance. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested. Tax assumptions and reliefs depend upon an investor’s particular circumstances and may change if those circumstances or the law change. If you invest through a third party provider you are advised to consult them directly as charges, performance and terms and conditions may differ materially. Nothing in this document is intended to or should be construed as advice. This document is not a recommendation to sell or purchase any investment. It does not form part of any contract for the sale or purchase of any investment. Any investment application will be made solely on the basis of the information contained in the Prospectus (including all relevant covering documents), which will contain investment restrictions. This document is intended as a summary only and potential investors must read the prospectus, and where relevant, the key investor information document before investing. We may record telephone calls for our mutual protection, to improve customer service and for regulatory record keeping purposes. Important information Issued in the UK by Janus Henderson Investors is the name under which Janus Capital International Limited (reg. no. 3594615), Henderson Global Investors Limited (reg. no. 906355), Henderson Investment Funds Limited (reg. no. 2678531), Alpha. Gen Capital Limited (reg. no. 962757), Henderson Equity Partners Limited (reg. no. 2606646), (each incorporated and registered in England Wales with registered office at 201 Bishopsgate, London EC 2 M 3 AE) are authorised and regulated by the Financial Conduct Authority to provide investment products and services. © 2018, Janus Henderson Investors. The name Janus Henderson Investors includes HGI Group Limited, Henderson Global Investors (Brand Management) Sarl and Janus International Holding LLC. 15 \hds. intdataDistGlobBSPresFI3. ABS RET3. SEC CREDAd hocCharleyIAPF breakfast _ Alternative Credit. pptx