JPMorgan is tugging at the mutual fund industry from different directions. Analysts at the firm downgraded shares of Janus (NYSE: JNS) from neutral to underweight, while upgrading rival T. Rowe Price (Nasdaq: TROW) from neutral to overweight.

In response, T. Rowe's stock inched slightly higher yesterday, while Janus closed out the trading day in the red.

Janus had a mixed showing last year. It began 2009 with $123.5 billion in assets under management, and closed out the year with $159.7 billion. That's a healthy uptick, but $41.5 billion -- or more than the difference -- is the result of net market appreciation.

In other words, Janus rocked, but accountholders walked. That's a shame.

Janus managers have historically been shrewd stock-pickers. According to fund tracker Lipper, 89% of Janus's namesake equity funds closed in the top half of their categories. The performance grows even more impressive when we stretch the timeline to three years; in that period, 94% of Janus' stock funds rank in the upper half of their peers.

Apparently, that's not enough. Janus has never really been the same since the 2003 industry scandal that busted the company and a few of its peers for trading improprieties. There has also been way too much turnover at its funds. Its CEO stepped down last year, amid rumors that MassMutual or Franklin Resources (NYSE: BEN) were interested in acquiring Janus.

A buyout may actually help here. Janus would be able to keep its hefty assets and its skilled managers, but whitewash its past under the moniker of new ownership.

Industry trends also suggest that this might be a good time to cash out. Charles Schwab (Nasdaq: SCHW) recently introduced several commission-free exchange-traded funds with dirt cheap expense ratios. After just five months on the market, they're already commanding more than $1 billion in assets.

We'll know more later this week, since JPMorgan has made this gutsy call just days before the two fund companies report their quarterly results. Janus steps up on Thursday. T. Rowe Price follows on Friday.

I would love to see JPMorgan proved wrong on its Janus downgrade. The funds are doing well, and net outflows improved during its previous quarter. However, whether Janus is a winner or a loser later this week, it may as well heed the inevitable buyout rumors.

The competitive landscape isn't getting any less rocky.

Would you rather own Janus or T. Rowe Price at this point? Share your thoughts in the comment box below.