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Clients Looking for an Early Exit? Consider CGCIX for Extra Long Retirements

If recent data is to be believed, you can expect more of your baby boomer clients to be approaching you about accelerating their retirement date.

Consider these two reports recently cited by a Bloomberg blog post:

  • The number of people expecting to work beyond age 67 fell to a record low of 32.9% last month, according to a New York Federal Reserve survey.
  • About 2.7 million workers age 55 and older plan to apply early for Social Security benefits—almost twice as many as the 1.4 million people in the same age group who anticipate working longer, according to a recent U.S. Census Bureau survey.

“After a year of early-morning Zoom calls, the specter of a deadly virus and soaring stock and real estate values, working American baby boomers who can afford it plan to get out while the getting’s good,” according to Bloomberg.

Here’s a fresh idea for these clients whose relative young age at retirement will mean they’ll need a considerable cushion: Calamos Global Opportunities Fund (CGCIX) has historically provided the capital appreciation required—and with considerably less risk.

CGCIX Has Outperformed in the Short and Long Term with Less Risk

Let’s look at a hypothetical example of how the fund would have provided consistent growth and income if your client had invested $500,000 at the fund’s I Shares inception in September 1997, and held that investment through March 31, 2021, making an annual withdrawal of $20,000 in December of each year starting in 1997.

The investment made in 1997 was more than capable of funding the retirement income needs for almost 24 years, and there would have been $1.82 million left in the fund by March 31 of this year. An MSCI ACWI index-based fund also would have completed the period with money remaining, although $700,000 less.

But look at the client’s experience during the period. CGCIX dropped below the invested balance just once, after the first withdrawal in year 2 and never looked back.

However, early on in the period, the balance of the index-based investment dropped deeper and needed three years to climb back to $500,000. It makes a return trip below $500,000 again in 2008, and again needed more time to recover. Clients who retired early to avoid more work drama are likely not signing up for investment drama, and your selection of CGCIX has the potential to help with that.

CGIX's Fewer Setbacks and Shallower Drawdowns Lead to a More Comfortable Retirement

Withdrawal Example: Calamos Global Opportunities Fund vs. MSCI ACWI Index

$500,000 INITIAL INVESTMENT, $20,000 END-OF-YEAR WITHDRAWALS
TOTAL INVESTMENT: $500,000
TOTAL WITHDRAWALS: $480,000
CALAMOS GLOBAL OPPORTUNITIES FUND ENDING VALUE: $1,815,838
MSCI ACWI INDEX ENDING VALUE: $1,177,099
Date Initial Investment at Inception 9-18-97 End-of-year Withdrawals Calamos Global Opportunities Fund (CGCIX) Year-end Value MCMSCI ACWI Year-end Value
December-1997 $0 $20,000 $470,898 $489,485
December-1998 $470,898 $20,000 $519,317 $577,005
December-1999 $519,317 $20,000 $745,231 $711,736
December-2000 $745,231 $20,000 $683,493 $592,547
December-2001 $683,493 $20,000 $617,085 $478,259
December-2002 $617,085 $20,000 $564,805 $367,494
December-2003 $564,805 $20,000 $675,689 $474,774
December-2004 $675,689 $20,000 $715,191 $529,571
December-2005 $715,191 $20,000 $834,688 $569,802
December-2006 $834,688 $20,000 $949,915 $672,473
December-2007 $949,915 $20,000 $1,065,503 $734,413
December-2008 $1,065,503 $20,000 $679,033 $407,094
December-2009 $679,033 $20,000 $876,767 $531,236
December-2010 $876,767 $20,000 $986,521 $581,427
December-2011 $986,521 $20,000 $944,204 $521,523
December-2012 $944,204 $20,000 $993,423 $589,147
December-2013 $993,423 $20,000 $1,104,471 $707,242
December-2014 $1,104,471 $20,000 $1,107,319 $720,522
December-2015 $1,107,319 $20,000 $1,098,584 $687,263
December-2016 $1,098,584 $20,000 $1,088,134 $725,577
December-2017 $1,088,134 $20,000 $1,289,420 $884,245
December-2018 $1,289,420 $20,000 $1,146,996 $785,289
December-2019 $1,146,996 $20,000 $1,337,975 $979,645
December-2020 $1,337,975 $20,000 $1,748,881 $1,124,460
March-2021 $1,748,881 $0 $1,815,838 $1,177,099

Source: Morningstar Past performance does not guarantee future results. Growth of hypothetical $500,000 assumes reinvestment of dividends and annual $20,000 withdrawals, as stated in each table’s title, at the end of December each year. These illustrations should be read along with the average annual total returns for the 1-, 5- and 10-year periods below. MSCI ACWI Index: Unmanaged index returns assume reinvestment of any and all distributions and, unlike fund returns, do not reflect fees, expenses or sales charges. Investors cannot invest directly in an index.

Calamos Global Growth and Income Fund (CGCIX)

Morningstar Overall RatingTM Among 399 World Allocation funds. The Fund's risk-adjusted returns based on load-waived Class I Shares had 5 stars for 3 years, 5 stars for 5 years and 5 stars for 10 years out of 399, 350 and 223 World Allocation Funds, respectively, for the period ended 5/31/2021.

Shareholders in CGCIX potentially benefit from the fund’s flexibility to invest in a variety of securities to capture opportunity and manage risk. Since its inception and through 3/31/21, the fund has captured 130% of the upside with just 80% of the risk (based on standard deviation). It’s a portfolio designed to achieve optimal risk-return asymmetry.

CGCIX Prioritizes Protecting the Downside and Participating on the Upside

Investment professionals, for more information on CGCIX, contact your Calamos Investment Consultant at 888-571-2567 or caminfo@calamos.com.

Before investing carefully consider the fund’s investment objectives, risks, charges and expenses. Please see the prospectus and summary prospectus containing this and other information which can be obtained by calling 1-800-582-6959. Read it carefully before investing.

Calamos Global Opportunities Fund average annual returns table and expense ratio

The principal risks of investing in the Calamos Global Opportunities Fund include: convertible securities risk consisting of the potential for a decline in value during periods of rising interest rates and the risk of the borrower to miss payments, synthetic convertible instruments risk consisting of fluctuations inconsistent with a convertible security and the risk of components expiring worthless, foreign securities risk, emerging markets risk, equity securities risk, growth stock risk, interest rate risk, credit risk, high yield risk, forward foreign currency contract risk, portfolio selection risk, and liquidity risk. As a result of political or economic instability in foreign countries, there can be special risks associated with investing in foreign securities, including fluctuations in currency exchange rates, increased price volatility and difficulty obtaining information. In addition, emerging markets may present additional risk due to potential for greater economic and political instability in less developed countries.

The MSCI ACWI Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed markets and emerging markets.

MSCI Emerging Markets Index is a free float adjusted market capitalization index. It includes market indexes of Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Israel, Korea, Malaysia, Mexico, Morocco, Peru, Philippines, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey. 

The MSCI World ex USA Index captures large and mid cap representation across 22 of 23 Developed Markets (DM) countries*-- excluding the United States. With 985 constituents, the index covers approximately 85% of the free float-adjusted market capitalization in each country.

The Bloomberg Barclays Capital U.S. Government/Credit Bond Index is composed of long-term government and investment-grade corporate debt securities and is generally considered representative of the performance of the broad U.S. bond market.

FTSE World Government Bond Index (WGBI) is a broad index providing exposure to the global sovereign fixed income market, the index measures the performance of fixed-rate, local currency, investment-grade sovereign bonds. It comprises sovereign debt from over 20 countries, denominated in a variety of currencies.

The Bloomberg Barclays 1-3 Month U.S. Treasury Bill Index is designed to measure the performance of public obligations of the U.S. Treasury that have a remaining maturity of greater than or equal to 1 month and less than 3 months.

Morningstar World Allocation Category funds seek to provide both capital appreciation and income by investing in three major areas: stocks, bonds, and cash. While these portfolios do explore the whole world, most of them focus on the U.S., Canada, Japan, and the larger markets in Europe. It is rare for such portfolios to invest more than 10% of their assets in emerging markets.

Morningstar RatingsTM are based on risk-adjusted returns and are through 3/31/21 for Class I shares and will differ for other share classes. Morningstar ratings are based on a risk-adjusted return measure that accounts for variation in a fund's monthly historical performance (reflecting sales charges), placing more emphasis on downward variations and rewarding consistent performance. Within each asset class, the top 10%, the next 22.5%, 35%, 22.5%, and the bottom 10% receive 5, 4, 3, 2 or 1 star, respectively. Each fund is rated exclusively against U.S. domiciled funds. The information contained herein is proprietary to Morningstar and/or its content providers; may not be copied or distributed; and is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Source: ©2021 Morningstar, Inc.

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